UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 401-ix

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

Welsh Affairs Committee

THE PROVISION OF CROSS-BORDER PUBLIC SERVICES FOR WALES

Tuesday 24 June 2008

PROFESSOR MERFYN JONES and MS AMANDA WILKINSON

PROFESSOR PHILIP GUMMET

Evidence heard in Public Questions 729 - 816

USE OF THE TRANSCRIPT

Oral Evidence

Taken before the Welsh Affairs Committee

on Tuesday 24 June 2008

Members present

Dr Hywel Francis, in the Chair

Mr David Jones

Mr Martyn Jones

Alun Michael

Mark Pritchard

________________

Memoranda submitted by Higher Education Wales (HEW)

Examination of Witnesses

Witnesses: Professor Merfyn Jones, Chair, Higher Education Wales (HEW) and Ms Amanda Wilkinson, Director, Higher Education Wales, gave evidence

Q729 Chairman: Welcome back to the Welsh Affairs Committee. We are delighted to see you both again. Professor Jones, could you introduce yourself and your colleague for the record?

Professor Jones: I am Merfyn Jones, Vice Chancellor of Bangor University and Chair of Higher Education Wales. Amanda Wilkinson is Director of Higher Education Wales.

Q730 Chairman: Could I begin by asking you the simple question: could you explain the role of Higher Education Wales and how it relates to the Higher Education Funding Council for Wales?

Professor Jones: Higher Education Wales is a National Council of Universities UK; that is, all the universities in the United Kingdom are represented in Universities UK. Higher Education Wales represents all the higher education institutions in Wales. The funding council of course is an Assembly-sponsored body that provides advice to Government and also through which a significant amount of funding flows. HEW and HEFCW work very closely together to promote the interests of higher education, but we have very different and clear roles.

Q731 Chairman: Given that higher education generally is becoming more global, has devolution been a good thing or a bad thing?

Professor Jones: I do not think it has necessarily been either good or bad. I think there are clear advantages in devolution and being able to operate globally with other agencies of the Welsh Assembly Government, but clearly we would wish to emphasise that higher education is a global business, that we are dependent on student flows across boundaries and that knowledge of course itself recognises no boundaries. There is also the fact that recent changes in the structure of government responsibilities at the UK level with the creation of DIAS (Department for Innovation, Universities and Skills) means that there are differing political structures on both sides of the border, and there has been some policy divergence as well. That does create some difficulties for higher education because we do operate as part of British higher education globally as well as well as in Welsh higher education. I think it does create some challenges for us, but it also creates very real opportunities as well. Only last week I had a meeting with officials from the Welsh Assembly Government to explore how higher education can make better use of the Welsh Assembly Government's global initiatives and international initiatives in terms of creating a Wales brand globally.

Q732 Mark Pritchard: There has been a lot of debate, as you know, in England about the equivalent qualifications and associated funding. What impact do you think that will have on Wales?

Ms Wilkinson: On the ELQ issues in particular, our understanding is that ELQ is supposed to be cost-neutral, so in terms of the consequences to Wales, there should not be an impact. Clearly, Wales has taken a different stance in terms of the ELQ issue. That has certainly been supported by the sector in Wales, given the need to focus on life-long learning and the fact of whether individuals should be deprived of a second bite 20 years hence when we are all very well aware of the structural changes that are likely to occur in the economy.

Q733 Mark Pritchard: For the record, can you briefly outline, as you see it, as professionals, what England is doing and what Wales is doing and the differences.

Ms Wilkinson: In terms of my understanding of ELQs in England, in broad terms, the proposal is to withdraw funding for second first degrees or second equivalent qualifications. If an individual has already completed one undergraduate degree, there would not be funding for a second undergraduate degree. That is not being proposed in Wales.

Q734 Mark Pritchard: If it was equivalent or less and if it was higher?

Ms Wilkinson: Yes, and in Wales there are no plans at present to follow such a policy.

Q735 Mark Pritchard: Do you think there might be some migration then of people who want to study certain subjects in England and because of these changes might come to Wales and knock on your universities' door?

Ms Wilkinson: That would require some quite detailed analysis, which we have not carried out. It depends on the nature of the individual and the type of study that they are wishing to undertake. Quite clearly, for those people who are working and who have families and who are rooted in England, there will clearly be some impediment to them coming to Wales.

Q736 Mark Pritchard: Obviously as a university but as a business, Professor Jones, do you see some opportunities that England's misery might bring Wales?

Professor Jones: I do not want to intrude on private grief! There might be some possibilities but we are talking about very specialist areas which affect in a significant way actually quite a small number of institutions in England that are very dependent, as it were, on this type of student. It does seem to me, if I am allowed to say this, that in the context of life-long learning it seems to be a somewhat self-defeating measure because clearly professionals are going to need to update and up-skill and so on. The whole emphasis of our higher education policy in the UK is very much on ensuring that people have the relevant qualifications for whatever new roles they adopt, new jobs they take. There may be opportunities for us in Wales but I would see them as being extremely limited realistically, partly because, as Amanda was saying, many of these people will be in employment of course and would not be the kind of people who would move.

Q737 Mark Pritchard: Will you be marketing into that niche?

Professor Jones: From my own university's point of view, we have not intended specifically to market for that at this stage.

Q738 Mark Pritchard: I have a further point on funding. Obviously when you compare the funding of higher education in Wales to that of England and even Scotland, there is a disparity. I just wonder whether you could outline the implications of that not only your university but for Wales as a whole.

Professor Jones: This is a major concern for higher education in Wales, as you can imagine. Perhaps I should say at the outset that the Minister for Children, Education, Lifelong Learning and Skills has asked me to chair a group to advise on how this might be addressed. Up to a point, I am constrained in how I can respond to that question but clearly it is on the record in the report published by HEFCW that there is a funding gap of some £60 million. I suppose the bottom line is that our cost base is, as it were, UK based. We pay the same salaries and sign up to the same national agreements as universities in England. All our funding does not come from the Welsh Assembly Government but a very significant part of it does, and if that part is significantly less than what the English equivalents would be receiving, in the end clearly that can create and will create an unsustainable situation. Indeed, I think in evidence to you recently the First Minister referred to that as a problem.

Q739 Mark Pritchard: Finally, on matched-funding donations, which has been announced in the framework, how do you think that will impact on higher education in Wales?

Professor Jones: This is one of those policy variations that I was referring to in response to the first question. This is a scheme that was introduced in England of £200 million to match‑fund fund-raising campaigns. It is designed of course to try to get universities in England successfully to create new funding streams; that is, from donations and so on. That money is not being made available in Wales and therefore we are not in a position not say to the potential donor, "If you give us £1, it will be match-funded and become £2".

Q740 Mark Pritchard: Do you think part of the £60 million deficit might be met by a similar scheme being introduced in Wales and, if so, where do you think those likely pools of donations and international companies are going to come from, given that by definition there are less international companies in the geographical area of Wales than there are in the geographical area of England?

Professor Jones: I do believe that the investment gap, the difference in funding between England and Wales, is a difference in the core funding and needs to be addressed as such. The matched funding scheme in England is in a sense additional and is a fairly small sum of money in global terms, in terms of the funding of higher education in the UK. There are two separate problems, it seems to me: one is the funding issue; and the second is that the policy variation and the matched-funding scheme is an example of different policies being pursued in England from in Wales. Its impact is serious but marginal compared to the fundamental issue of the core funding.

Q741 Mark Pritchard: May I just say I was in Amman recently and I met somebody who works for the Amman Government. He had studied at university in Wales and he was praising the university sector.

Professor Jones: You must give me his name!

Q742 Mr David Jones: I would like to ask you about the DIUS review on higher education in England. Is HEW or are Welsh universities individually participating in that review?

Professor Jones: We certainly are through Universities UK, which is preparing a statement to present to the DIUS review. I do not think I am revealing any secrets: I have seen an early draft of that document. Right up front, I think it does emphasise that even though the DIUS review is a review of higher education in England, and a root and branch review by the way of higher education in England, the implications of any recommendations that arise from that review are going to be profound for the whole of the UK - for Wales, Scotland and Northern Ireland as well. We will certainly be inputting into the discussion directly through Universities UK, but there also of course needs to be an engagement between the Welsh Assembly Government and the Department for Innovation, Universities and Skills.

Q743 Mr David Jones: What do you see as the implications for Welsh higher education to be?

Professor Jones: Because we are part of a UK system of higher education, and that is the way in a sense we are perceived globally, if there are major changes - and I do not know what those changes might be and certainly when we also consider the issue of funding and the cap on student fees and so on that is also being reviewed across England - either in policy or in funding in England, then that will have a profound impact on our competitive position in Wales. If there is an increase of funding in England, then that will clearly affect our ability to compete. There may be policy divergences as well. We do not know what the recommendations are going to be. Anything that affects the English sector, which after all is the major part of the UK's university sector, and any policy that affects that affects us in Wales. If I may say so, that is why this committee and Members of Parliament have a very important role in ensuring that the process in England is aware of the situation in Wales and similarly that policy makers in Wales are aware of possible shifts in policy in the UK Government.

Q744 Mr David Jones: If the review were to result in an expansion of the number of higher education centres in England would there be any particular consequences for Welsh higher education centres? I am thinking particularly perhaps of those close to the border.

Professor Jones: There already are some plans of course in England to expand the number of outlets, as it were, for higher education. Yes, it certainly would have an impact. The truth of the matter is of course that perhaps not quite all but most institutions in Wales are not very far from the border and do already compete with institutions, On the other hand, they do not have to be just on the other side of the border; they can be some way away. The distribution of HE institutions in England could clearly affect our market because there is, as you know, a considerable flow of students across the border in both directions.

Ms Wilkinson: There is certainly an issue in terms of England looking at this review only within England's borders and not taking into account the institutions that are spread certainly along the Welsh border, which could give a very different complexion to what one might describe as a cold spot for higher education, given that provision is there just over the border.

Q745 Mr David Jones: To what extent do you understand that the Welsh Assembly Government is engaging with DIUS in this review?

Ms Wilkinson: I would say we are not clear about the level of engagement between the Welsh Assembly Government and DIUS in terms of this review.

Q746 Mr David Jones: Are you aware of any engagement at all?

Ms Wilkinson: We are not aware of any specific engagement in terms of the DIUS review between the Welsh Assembly Government and DIUS in terms of how that is going to inform the review of the Assembly's own policy in relation to higher education reaching higher, which is due to take place this autumn.

Q747 Mr David Jones: Do you think that is a shortcoming, given the clear importance of the DIUS review to Welsh higher education as much as to English higher education?

Ms Wilkinson: I think, as we have already articulated, it is very important that there is proper engagement between all players in terms of this DIUS review because there are bound to be impacts on Welsh higher education as a result of this review. One could argue that it is an England-only policy, but that may well necessitate changes in Welsh policy if we are going to stay competitive. We need to be well-cited on what comes through that review at all levels, particularly in relation to those UK issues around research in science, which are very important and where we have already had some issues.

Q748 Mr David Jones: It would be fair to say that you would be looking for more co‑ordination at government level in terms of higher education policy in England and Wales? Ms Wilkinson: Yes, I think that is right. I think we do have to look at the mechanisms for co‑ordinating higher education policy at a UK level, not to prejudice the role of the Welsh Assembly Government and the devolved powers that it has in relation to higher education, but there are clearly UK competencies and there needs to be co-ordination in order those are properly addressed and that the needs of Wales are properly reflected.

Q749 Chairman: When we had the Secretary of State for Wales before us discussing health matters on this inquiry, when we asked him about the nature of the bilateral ministerial meetings, he agreed with us that it would be healthy for democracy and for policy development that these meetings should be made clearer, announced, the nature of the meetings should be explained. Would you agree that that would be equally helpful in terms of when the education or higher education ministers met in this context?

Professor Jones: Yes, I am sure that it would. You will see in our written evidence that we do suggest some mechanisms, and indeed we discussed those with the Secretary of State - that would allow an all-UK view to be developed so that at least the various administrations understand what each other is doing because whatever happens will impact on other parts of the UK. We do need that kind of structure. Again, if I may repeat what I said earlier, it seems to me that that is where, if I may say so, there is a role for Members of Parliament and indeed for this committee to be aware of what is happening, both at a UK, England and Wales level.

Ms Wilkinson: There is also a need for proper co-ordination between civil servants, otherwise we miss out on what appear to be quite straightforward issues; for example, DIUS is co‑ordinating a meeting with Indian officials to look at the UK initiative for higher education. Again, we are not clear about the level of Welsh involvement in that meeting and it is as important a market for our institutions as it is for institutions in England. It is also in those smaller market-sensitive issues where co-ordination is going to be helpful to us.

Q750 Mr Martyn Jones: What are your views on the Welsh Assembly Government's science policy document "A Science Policy for Wales"?

Professor Jones: Science policy is an area where clearly there is some funding through HEFCW into scientific research but science as such is not a devolved area because much of the funding for science through the science research councils and so on is UK-based. We very much welcomed the development of "A Science Policy for Wales" and look forward to it being underpinned by funding that would allow the science base to be developed in Wales. Of course, when one is thinking about science in Wales, it is not entirely limited to universities but it is very dependent on universities in the sense that we do not have the other corporate capacity in science research that you find elsewhere. Science and the development of science - and I use the word 'science' broadly - it seems to me is absolutely fundamental to the future success of our economy. We do need a coherent plan for ensuring that we do have a strong, healthy science base in Wales. We do face particular challenges in that regard. Some of the statistics do demonstrate that we have a long way to go in order really to establish ourselves as a major force.

Q751 Mr Martyn Jones: Is it in the best interests of the Welsh people to have a separate Welsh policy on science when science is a UK responsibility, as you noted in your memorandum?

Professor Jones: I do believe there are certain emphases in Wales; there are strengths and weaknesses in Wales which are not reflected elsewhere. It does seem to me to be probably sensible to have a science policy which drives and which is, as it were, built on our strengths and addresses our weaknesses. To some extent, the science policy we have does exactly that.

Q752 Mr Martyn Jones: Does Welsh higher education get a fair hearing and allocation from the UK-wide elements of the Department for Innovation, Universities and Skills programmes?

Professor Jones: It is up to us really to respond to those initiatives but there are some initiatives which are England only. I am not referring to DIUS here but for example the merger of the Medical Research Council with the NHS research capacity in England as it were brought a UK-wide body and an England-only body together into one funding mechanism. It is early days to say if that is having any impact on funding. Clearly, if you look at the percentage of research council funding coming into Wales, we ought to be getting more of that but I would be the first to admit that that is as much to do with the strength in the sector as with research council policy.

Ms Wilkinson: The real issue is how we develop our activity and how we can be supported to do that, given the supporting role that scientific development can play to the economy in Wales. That is fairly fundamental from our point of view in terms of the way we have approached science policy. One has seen interventions in funding at a UK level which necessarily have quite specific regional impacts. I think we would like to see Wales considered for that sort of funding.

Q753 Mr Martyn Jones: Can I move on to health policy? How effective is the UK-wide co‑ordination of workforce planning for health professionals?

Professor Jones: May I respond to that in a very narrow, edgy way rather than the big question involved here? This affects higher education and this is true across the United Kingdom, as much in England as in Wales. It can affect us very directly. The first point to note, I suppose, is that the market for health professionals is a UK market or indeed a global market. Work force planning within national boundaries can perhaps in itself be not very helpful. What happens in HE, to give you an example, is if one day we think we need thousands more nurses, we put on the courses; we hire the staff and create thousands more nurses. Then the workforce panel might say, "Actually, we do not need any more nurses", so we will turn off the tap and then you are left with very expensive staff and equipment and so on. That has been a big problem in England and it is something of a problem in Wales as well. The same goes in other areas. Once you do attempt to fund on the basis of workforce planning, it is very important that those who are doing the funding and planning recognise that when HE puts on these courses to train vocationally that infrastructure is still in place when the tap is turned off and that it is a real expenditure. Therefore, there is a real risk in being involved in that business because we cannot be guaranteed on the throughput of students.

Q754 Mr Martyn Jones: Is there anything that you can do to help the over- or under-supply of professionals in the HE sector? Can you liaise with DIUS to get them to try to get that balance, if you like?

Professor Jones: Yes, we do and there is engagement between the professional bodies and we train in these vocational areas. The same is true, by the way, of teacher training as well. There is a considerable interchange of views and planning, but it is not always clear that there are significant costs involved in reducing provision in these areas.

Q755 Mark Pritchard: I have two brief supplementaries on research funding. Do you think Wales get a fair slice of the cake from central government and do you think it is research funding is dominated by the Russell Group and the usual blue sky allocations?

Professor Jones: I think there are all sorts of issues there when you look at the distribution of research funding. Of course research funding does not just happen in universities. As I said earlier, because of the distribution of corporate R&D, relatively little of that happens in Wales. In Wales we are particularly peculiarly dependent on universities to sustain research. If you look at the figures, we should probably be getting a bit more of that research council money and money from other sources. That is in part because all of this money is not distributed by formula; it is distributed in competition. So it is all to do with the strength of the competition. Yes, there is a huge degree of concentration of research in a relatively small number of units. It is quite extraordinary the degree of concentration of research. It is not just institutions in Wales that have found it rather more difficult; many others do as well.

Q756 Mark Pritchard: To help the committee, Professor, is there a particular example of a university in Wales, not necessarily Bangor to help yourself, where if the increase in research funding was given, Wales's global competitiveness or industrial base would be enhanced?

Professor Jones: I think so very definitely. There is a number of universities in Wales where that would make a huge difference. I was quoting last week a figure - and this comes from MIT - that in order really to have a major impact on a regional economy you need a research income of about £40 million a year. Certainly the research universities, obviously Bangor and Swansea, are not yet in that category; we are more at about the £20-£25 million per year. Cardiff of course is over that point. If that step change were to happen, I think we would see a very major impact on the Welsh economy. I have no doubt about that.

Q757 Alun Michael: Before going on to the main question, can I stick with this question of research funding? What measures, if any, should be taken to try to increase research council funding? Martyn asked you about the relationship with the Department of Innovation, Universities and Skills but what about the specific role of the research council?

Professor Jones: All of that money is won competitively. In a sense, it is our responsibility; we should be putting in stronger bids and perhaps lobbying harder for the bids. I think we do very well but we need to do better. I honestly do not believe that it is driven by any kind of policies at the research council level. On the other hand, we do need to be aware that there are other substantial funds going into research in other parts of the United Kingdom, either directly from corporate investment or from regional development agencies, which have made a big impact of direct investment in research in other parts of England, particularly the north‑west of England for example.

Q758 Alun Michael: In that event, if it is really in the hands of the universities in Wales to do better competitively, is your organisation seeking to enhance their capacity to do that?

Professor Jones: We are but not so much through Higher Education Wales. We are certainly collaborating in order to try to do that. That is the key to it because many of our science departments are a bit on the small side, even within each institution, but if you put them together with other institutions they become very significant.

Q759 Alun Michael: I think some of us have welcomed the engagement of Higher Education Wales with Members of Parliament in the last year or so, and perhaps the upping of the game and that relationship might help.

Professor Jones: Absolutely.

Q760 Alun Michael: Can I go to the question of the attraction of students from the rest of the UK? I am sure you would want to say that Welsh universities are very successful at this. What are you seeing as the trends? What have been the recent trends and what are you predicting for the future in terms of the numbers applying from English to Welsh higher education institutions?

Professor Jones: The figures are difficult to interpret, partly because the rules have changed. What would concern us, and we really need to wait until the autumn when we see the acceptances to know quite what has happened, is if there were to be a reduction in the number of students from England, or indeed from the rest of the EU, coming to Wales. There are at least some signs - it is really too early to see it as a trend I think - that would allow us to worry. Certainly, something like 96 %, I think I am right in saying, of students in England go to English institutions. We are talking about a very small segment of the English market.

Q761 Alun Michael: Can I try to push you there? You say there are some signs that we need to worry about it. There is a good piece of advice that if there are things to worry about, worry early. Taking your point that we cannot be conclusive until we see the numbers actually coming and the figures in the autumn, what about the figures applying? Is that where there is a worrying trend?

Ms Wilkinson: There has been this year some reduction in the numbers of those applying, but we have to weigh that against the fact that the number of choices applicants can make has moved from six institutions to five institutions, which is what makes it particularly difficult this year to make a judgment.

Q762 Alun Michael: Given that we are talking about universities and the mathematical capacity within the universities to work out and predict what the impact of six to five would be, is the number of applications lower than you would have predicted?

Professor Jones: The truth of the matter is that going from six to five has not been equalised across all universities. There has not been an average drop. Everybody has gone to different points on it, but I think I would allow myself to say in this context that I am worried about any trends that would indicate that, and I think other evidence to this committee has also suggested this. Clearly as a sector we are very dependent on attracting students from other parts of the United Kingdom and from the rest of the world.

Q763 Alun Michael: Are there decisions that have been taken in respect of the higher education sector in Wales that might have helped to encourage that trend and are there steps that you consider should be taken to enhance the capacity of Welsh universities to attract students in the next and subsequent years?

Professor Jones: What research has been done in this area would suggest that there is not really a problem in the way in which Welsh universities are perceived by potential students from England. It is very difficult to get a handle on whether there is an issue or not. Certainly one of the things that would attract more students would be perhaps a higher level of capital expenditure so that when students do visit universities in Wales they do see the same level of accommodation and quality of buildings and so on that they would find on an English campus.

Q764 Alun Michael: And you are suggesting that they do not?

Professor Jones: I am suggesting that it is beginning to look like that.

Q765 Alun Michael: What about things like maintenance and finance available to students directly?

Professor Jones: That is the way of course that universities are coping with under-funding, by not investing as much because you cannot not invest in staff and salaries and pension costs and so on. What you can save on is investment on buildings.

Ms Wilkinson: Certainly if one looks at national early student survey data, Welsh institutions still score extremely highly in terms of student satisfaction, but if you look at some of the key indicators, then clearly views about the learning and teaching infrastructure in Wales are somewhat lower than they are elsewhere. I think that is a major concern for us, particularly if we are looking to the future; it is not just what happens now but it is the demographic predictions which are also key to us, which will make attracting students from England and elsewhere much more important to us over the next five years or so.

Q766 Alun Michael: It would probably be useful to have any supplementary detailed information that you can provide for us, both now and subsequently. I am sure we would be interested. My final question: obviously skills are enormously important to the Welsh economy and to the future of individual students. Should Wales be adopting the Leitch adult skills targets, bearing in mind the old device that "what don't get measured don't get done"?

Professor Jones: It is my belief very strongly that Wales needs to be ambitious in terms of the skills base that we have. It seems to me that the Leitch position is very clear - and it is a Leitch assessment for the United Kingdom but up to each administration how they respond to it - that the needs assessment of the United Kingdom is a very high percentage of people at level 4, which is graduate level, in the workforce by 2020. Certainly, as much as a citizen as somebody involved in higher education, I would be very disappointed if the percentage of graduates in Wales was significantly lower than in England. It is at present marginally lower and significantly lower than Scotland, but clearly, if we are to survive in the innovation and knowledge economy of the future, we must have people with higher level skills.

Q767 Alun Michael: So that is a 'yes' really?

Professor Jones: It is a 'yes'.

Ms Wilkinson: That would be a 'yes'. Our policy is that we should be pursuing the Leitch target of 40%. We cannot run an economic policy that is about creating a knowledge-driven economy in Wales and not look at how we are supplying that economy with graduates. If we are going to be competitive, because we will need to be competitive in attracting those businesses, then we need good availability of properly qualified individuals.

Chairman: I was very impressed with the evidence given by Corus to the Welsh Assembly Education Committee recently. I think they were exploring the relationships with major international companies like Corus.

Q768 Mr David Jones: Just reverting to the issue of attracting students from the rest of the UK, would you say that overall the Welsh Assembly Government's policy on tuition fees has proven beneficial or otherwise?

Ms Wilkinson: I think it hard to say. It is clearly going to be appropriate at some point that that policy is reviewed, particularly because obviously it is a universal policy and one would want to look at whether or not that has been worthwhile expenditure and whether one would want to look at more targeted expenditure, for example. One would also want to consider issues such as obviously the need to fund EU students coming to Wales from that particular fund. There has been some slight increase in the numbers of Welsh students choosing to study in Wales, but it is not a huge increase. I would not say there was a clear indication that Welsh institutions are more attractive to Welsh-domiciled students as a result of the arrangements that have been put in place.

Q769 Mr David Jones: What are your views as to what might happen if that policy continues? Do you think that there is a danger that it will result in an under-funding of universities and the things that you have been talking about - capital expenditure and so on?

Ms Wilkinson: We need to be clear. From our point of view, the Welsh Assembly Government can run a policy to support students, but what we need to ensure at the same time is that we are also providing the right and the same quality of higher education. Quite clearly, we have concerns that are our own funding needs need to be met, irrespective of whatever decision is made in respect of support to students.

Q770 Mr David Jones: Have you received any reassurance over that from the Welsh Assembly Government?

Ms Wilkinson: Any reassurance about our funding?

Q771 Mr David Jones: Yes, if the policy is maintained?

Ms Wilkinson: As Professor Jones mentioned at the beginning of our evidence, he is shortly to chair a review of higher education in Wales, which will, I hope, also look at our funding situation. I think we have to wait and see what the outcome of that particular review is to see whether or not our funding needs can and will be addressed.

Q772 Chairman: Could I thank you for the evidence you have given us today and also for the various memoranda you have provided earlier. It has all been extremely helpful to us in this inquiry. We look forward to receiving one memorandum to you. You offered to give us some information that Alun Michael requested.

Ms Wilkinson: That is in relation to student flows and future student trends.

Memorandum submitted by Higher Education Funding Council for Wales

Examination of Witness

Witness: Professor Philip Gummet, Chief Executive, Higher Education Funding Council for Wales, gave evidence.

Q773 Chairman: Good morning, Professor Gummet. Could you briefly explain the role of the Higher Education Funding Council for Wales and how it interacts with Higher Education Wales?

Professor Gummet: We are an Assembly Government sponsored body set up under the 1992 Further and Higher Education Act at the point when higher education responsibilities across the UK were separated between the different territories within the UK. So we sit alongside the English Funding Council, the Scottish Funding Council and a rather different arrangement in Northern Ireland. Our responsibility is to disburse funds made available by the Assembly Government for higher education purposes in Wales, and also to be a principal source of advice on higher education matters to the Assembly Government. In addition, we have a function in Wales different from that in England in that we are responsible for the provision in initial teacher training. There is not equivalent to the Training Development Agency, nor is there an equivalent in Wales to the Office of Fair Access in England. We do that also. We are a very cost-effective organisation.

Q774 Chairman: Given your much wide remit and given that you need to work with other funding councils and various other bodies and have various joint meetings, are you confident that you have, for a small organisation, sufficient capacity to deal with the increasing number of cross-border issues that appear now to be emerging?

Professor Gummet: I suppose it would be an unusual organisation that said it would not welcome more if it had it. I do not think we are unreasonably pressed. I think as long as we manage our staffing nimbly and carefully, we have sufficient to be able to maintain reasonable liaison across the UK with the parties with whom we interact particularly strongly.

Q775 Mr David Jones: Given. as we have heard from Professor Jones, that higher education transcends national borders and is truly international, would you say that devolution for Wales has been beneficial for higher education in Wales?

Professor Gummet: I am going to answer in similar terms, I fear. I have drawn up a little balance sheet. It is too long to present in oral evidence.

Q776 Mr David Jones: What are the bottom lines?

Professor Gummet: The bottom line is quite difficult to read - my writing is not very good! I would emphasise three areas where it is possible to see advantages, but there are disadvantages that correspond to this. One is in tailoring policy to more local needs. There are a number of things I could cite there. It is a growing list as policy diverges between the different parts of the UK, but it comes down to things like tailoring widening access policies in particular ways. It comes down to funding research differently; different levels of funding compared with England. It comes down to not pursuing the equivalent and lower qualification policy in England or to having what we regard as a world-leading programme for student placements in Wales, Graduate Opportunities Wales, which we do not think is replicated anywhere else in the UK and which is possible to do on our scale, and scale is quite important in all of this. It comes down to funding for admission activity by formula and therefore being quite interested to see the Sainsbury Report; we regard it as a great step forward to begin to do this in England. Apparently in Scotland and Wales this is familiar practice. We fund our education generally by credit, which is not the case in England but is the case in Scotland as well, and which we argue gives more flexibility about funding. It is possible to tailor, first of all; secondly, it is possible to join up, and one reason we can fund by credit is because we have a credit qualifications framework for Wales running at all levels. So we have that degree of continuity through all levels of the education system, as is the case in Scotland but not in England. All of our higher education institutors are all engaged with the sector skills councils, which is replicated, we understand, by only one RDA region in England. We have a number of things going on between departments in the Assembly Government, particularly in the third mission area where again we can operate in complementary ways. So tailoring is one thing; joining up is the second; and the third, and these are linked, is accessibility. It is possible with our small number of institutions to have all the vice chancellors and all the chairs of governing bodies and the members of the funding council round the same table, just about, and to have a dialogue at that level. It is very difficult to do once you move beyond our scale. It means that you can have quite personal, detailed knowledge of what is going on and that there is lots of access to ministers and Assembly members. If I were to run the negative side, I would start with those same things and say that those same three things about accessibility are also negatives. It can be very personal; it can be very accessible, so accessible that you know you are going to catch up with who said what to whom, and so there are difficulties there, too. In terms of tailoring, we had some discussions earlier about funding priorities; if different choices are made about funding levels, that can be positive or negative. At the moment, the evidence we have presented to the Assembly Government is that it is negative, that there is a gap in funding between Wales and the rest of the UK. There are complexities about student flows. Perhaps the last thing I might say is this. On joining up, just to resume a theme raised earlier, it is in the relations with Whitehall where devolution has led to issues about joining up. We have heard discussion about DIUS earlier. You will have seen in our submission to you a concern expressed about what seems an inevitable direction of travel, given the structure of that department. I will happily come back to that. We have had references to the Medical Research Council transition into the new OSCA arrangement, which I am very clear was begun without realisation in the Treasury that the MRC had a UK-wide remit. It was trying to take the Department of Health's research budget and seek to do something with it but to put it with MRC without appreciating initially that MRC had a UK-wide budget. I would say the same thing about the great debate about the future of the research assessment exercise in March/April 2006 where again it is very clear that in moving towards a radically different method of assessing research funding for England, the Treasury did not take account of the fact that the REE was a UK-wide process and was seen as an activity of great importance in other parts of the UK. The bottom line is moving, I guess I would say.

Q777 Mr David Jones: That was very helpful. You have just mentioned the funding gap, which is obviously a matter of considerable concern to you. What are the medium to long‑term implications if that gap is not addressed and how would you say it should be addressed?

Professor Gummet: I think the first thing is that the institutions in Wales have done a very good job, as has been indicated already, in managing within this particular financial environment. As has been said, the results of the national student survey, for example reflect very well on higher education in Wales, and there are other similar indicators. Where I think the problem falls is in terms of investment in capital, first of all, and we have very clear evidence that institutions in Wales are less able to invest in capital, and we have less capital funding available essentially to give to them than is so elsewhere in the UK. You have already heard evidence about what that means. It means that if you go round a campus in Wales, you are not going to see quite the same as you do if you go round some campuses in England now in terms of the quality of the relatively recently built buildings. The second thing is in terms of capacity to invest in teaching, which is not to say that existing staff are not working extremely hard and effectively, but in terms of modernising, there are issues there. The third is in terms of research. There was discussion earlier about the fact that Welsh higher education wins less than one might wish from the research councils. There are a number of reasons for that, and some of those were gone through earlier, and some of that is to do with scale and scope of departments. That is why we are driving so hard to try to get collaboration between departments and putting together Bangor University with Cardiff and Swansea, for example, in cognitive neuroscience, which is a world-leading research operation now, or an institute of mathematical and computational sciences with about 70 or 80 people. We realised that there are lots of mathematicians in Wales but they were hidden in civil engineering and other branches. Essentially we forced them to come out, bare themselves, and unite within an Institute of Mathematical and Computational Sciences, which is now a very considerable force. We have activity between Bangor and Aberystwyth across a number of research streams where they are integrating these research activities and essentially doubling the size of the department. What we hope is that that will enable more ambitious proposals to go into research councils, which would be more successful in winning larger prizes, but time will tell. The merger that we took through between Cardiff University and the College of Medicine has already demonstrated the value of that degree of scale in research co-cooperation because they have gone up in research funding tremendously since that merger. Some of the research issues, as Merfyn Jones was saying, are to a degree within the scope of the institutions themselves to address by putting in place the organisational arrangements that enable them to be more ambitious, but part of it also is about having enough bodies on the ground relative to competitors as well. One is trying to deal with that by bringing people together, but it would be better, given that we are running from behind and therefore as always when trying to catch up having to run faster, if we could inject a bit more pace into that process by investing in more staff in key research areas.

Q778 Mr David Jones: But that requires closing the funding gap?

Professor Gummet: That requires additional funding.

Q779 Mr David Jones: How should that be achieved?

Professor Gummet: I fear I am the wrong person to answer that. We work within the grant that we receive from the Assembly Government and we advise on the consequences of that grant as we do in papers such as our funding gap paper.

Q780 Mr David Jones: But the grant is insufficient at the moment?

Professor Gummet: The advice we have given is that over the last three years when we have been doing this analysis there has been a growing gap in funding between Wales and England, yes.

Q781 Mr David Jones: DIUS's review contemplates more higher education institutions in England and the Secretary of State has asked the Higher Education Funding Council for England to lead the debate on this. What are the implications for the higher education sector in Wales of new centres in England and is HEFCW engaging in the debate, too?

Professor Gummet: We are not engaging in the debate about the new university challenge, which I take it to be the reference here, because that is an England-only exercise. We would be concerned if there were significant investments in higher education on the English side of the border, for all the reasons that have been given earlier about the competitive pressures that they would generate, but I am not all that concerned in some ways about this exercise. The amounts of money involved do not seem to me to be huge. There is a little bit of growth in an English scale in student numbers coming through this. I think it is going to be a very interesting process to see how this moves forward. I was doing some sums last night looking at the figures in the English document, just scaling them for Wales and roughly dividing by 20 and seeing what that looked like. I would say, in relation to the early phases of this process in England, that we are already spending - and bear in mind that a lot of this discussion in England is about prospective funding, it is not actually happening yet - on developing a higher education presence in the heads of the valleys at least equivalent, and arguably slightly more, than the funding which is going in in England and across England to this whole range of activities. So I am not entirely sure that to make of this English initiative. It may be one of those to which one might eventually say there is less to it than meets the eye.

Q782 Mr David Jones: Are you not engaging in the debate because you are precluded from doing so or because you do not think it appropriate to do so?

Professor Gummet: We do not have any right of access to the debate. I think what is going on is the HEFCW - and you really need to ask them - are trying to work out now how to take this forward; they are looking at partnerships. I would be surprised if they were looking at very many brand new higher education institutions. They are much more likely, I would imagine, to be looking at possibilities for liaison between HE and FE institutions, for outreach centres of various kinds, things of that sort, rather than massive new investments. I anticipate too that they are going to find themselves swamped by massive demand from more or less every town in England saying can we have one of these, please, we would like a university too. It is going to be very interesting to see how this process is managed.

Q783 Chairman: Given the challenges that you have outlined very comprehensively, could you explain to us briefly how you interact with Higher Education Wales as a kind of, for want of a better word, advocacy role for higher education? What is the relationship and should you not be creating some kind of a united front to explain some of the problems that you have outlined to the public - not just to the Welsh Assembly Government - and then maybe with a higher awareness of the challenges that face you perhaps you would have a much better and stronger response from the Welsh Assembly Government.

Professor Gummett: There are, I am sure, things that between us in HEFCW and our colleagues in Higher Education Wales we could and should be doing to explain rather better to the public at large, the Assembly and surrounding organisations as it were what the value of higher education is. I am quite sure we need to raise our game in that regard, but in terms of forging alliances and things of that sort there are very different roles here. We are an Assembly Government-sponsored body; our powers come through Acts, our funding comes through the Assembly Government, we work within our annual remit letter which gives guidance and comes from the minister, so we are in that sense the instrument of the Assembly but we are also the adviser to the Assembly Government and so we try to operate in a way, in our relationship with the Assembly Government where we can be seen as being fully responsive to guidance coming from the Assembly Government, but also quite robust in the advice that we give about that guidance and any issues over implementation of it that we think the minister or officials should hear, but ultimately they will decide the process and we cannot gainsay that. In our relationship with Higher Education Wales - and others would need to endorse or deny this - we try to operate on a basis of no surprises first of all, of trying to make sure that in so far as it is politically possible we keep each other alert to developments. There are times when it is not but in so far as it is my sense is that it is a mature relationship, it is the sort of relationship that one would want, where from the funding house point of view one can talk to the organisation which represents the institutions in a fairly frank, off the record way and think about things jointly. We may agree to act in the same way or we may agree that we are going to have to act in different ways, but we are not surprising each other particularly when we do that. We try above all to ensure that whatever the issue at stake is we agree about what the facts are, even if we place different interpretations on them.

Q784 Alun Michael: We heard earlier about the worry that has been expressed in a variety of quarters elsewhere about the decline in the number of applicants from England to Welsh higher education institutions. Taking for granted the business that we need to see the outcome in October and all the rest of it and cutting to the chase, is the decline in applications from England worrying, what do you think can be done to increase the number of applications and how important do you think it is?

Professor Gummett: In terms of your earlier reference to sage advice, we did start to worry and we, jointly with Higher Education Wales, have commissioned some market research into this. We have had initial phases of that work and we sent the researchers back to do a bit more. As our evidence to you indicated, we are seeing some changes in patterns of application. It is very difficult, for the reasons we have already given, to say with any firmness at the moment whether or not these are blips or whether they are trends. Since the introduction of variable top-up fees in England and then a year later in Wales there has been such turbulence in the system, with all sorts of strange things happening - students rushing to enter and not taking gap years in order to get under the wire before the new fee regime and that sort of thing, then the relaxation afterwards - actually interpreting what is going on is extremely difficult. As has also been said, the students who come from England into Wales, although very large relative to the Welsh/Irish education population, are very small relative to the English one, so only a very slight variation on the English side can have a big impact one way or the other; it is very, very turbulent and difficult to understand. Nevertheless, it has seemed to us that whereas in England with the introduction of variable fees there was a drop in applications, followed by a rise which has now restored the position above where it had been before, in terms of English applicants to Wales that has not happened. There was a rising curve, it dropped, it has not yet risen back to the point where it was before that.

Q785 Alun Michael: What can be done about it?

Professor Gummett: There is still a question about whether it will rise back or not, and the second thing is to understand what is going on. It is not economically rational for an English domiciled student to be deterred from coming to Wales because of the different fee support regimes because it costs them the same whichever side of the border they study, but it may be that some are susceptible to the syndrome on the plane or the train where you discover that the passenger in the next seat has paid a different price, and it may be that that is a factor. It may be that there are issues to do with staying at home. It is a UK-wide trend that students generally are staying nearer to home and again if one is looking at migration across borders that could be a significant factor.

Q786 Alun Michael: Is there an equivalent increase in Welsh students applying to Welsh universities?

Professor Gummett: There has been.

Q787 Alun Michael: And what about applications by students from one part of Wales to another, from South Wales to North Wales or vice versa?

Professor Gummett: I do not have detail on the latter to hand but I could get it. Certainly there has been an increase in students from Wales applying within Wales, yes. One of the things that has come out of the marketing work is that there are some students from England who are attracted to Wales because it is distinctive and different; there seem to be some who are being deterred because it is distinctive and different as well. That sort of tension is not unusual in any sort of marketing environment. There is also - and this was the interesting discovery - a really quite significant number who do not seem to have thought about Wales at all, so in terms of what can be done, that is something that we are wanting to probe a little bit more, to say is there in fact a potential market there that could be addressed. Then, though, we get into some quite difficult issues about branding, and again if you had Mervyn and Amanda here they might well wish to say to you something about the dilemmas over whether one brands Welsh higher education or whether one brands Wales as part of the UK higher education. It is quite a delicate issue.

Q788 Alun Michael: You referred to the market research and you said you sent them away to do some more; when is that research going to be available because, clearly, it would be of interest?

Professor Gummett: Quite soon; it is weeks rather than months away.

Q789 Alun Michael: We might be able to see that before the summer then.

Professor Gummett: Yes.

Q790 Alun Michael: That would be helpful. Powys, for example, has no university of its own, nor do the neighbouring English counties of Shropshire and Herefordshire as such. How do you make sure that there is adequate part-time provision in that part of Wales?

Professor Gummett: We did do a joint review with HEFCE three years ago when there was a lot of excitement being raised in Herefordshire and Shropshire about the need for new higher education provision, so our colleagues in HEFCE appreciated very quickly that anything they did would impact. We did a joint exercise on that and the long and the short of it was that the problem began to dissolve as the inquiry proceeded. The consultants we sent in to talk to the various people who had been saying there is a problem came back saying when you probe them on their reasons the arguments collapse. We also had the consultants go and do some survey work of young people in schools and people in FE colleges as well. The overall conclusion was that there is no sign of a clear problem in Powys, there is very high participation rate in Powys, but there may be latent demand for part-time or vocational courses, but the trouble with latent demand is that it is very hard to know how to bring it up to the kind of visibility. The issue further would be then about the fact that it would be such small numbers. What we found through this work was if you could go to an individual firm and they say, yes, I need two people trained and you think how do I deliver to two people? It is the economics of it. The answer, it seems to us, lies through work between HE/FE. You had the principal of Coleg Powys here last week, did you not, John Stevenson, and as I recall he said that Coleg Powys, which runs right through in four locations, works closely with four higher education providers from memory - I may not have caught that quite right - and it seems to us that that is the way in which one might be able to maintain local provision on some scale within an area where the population density is quite low and where there is no real evidence from the detailed work done that there is unsatisfied demand.

Q791 Alun Michael: Perhaps it would be interesting to see that work that you referred to. If I could just ask one other question, what has come out from a number of comments has been the importance of critical mass in terms of research, in terms of profile and so on. What approach are you taking to universities that do not have that critical mass? There has been talk for ages of a merger between the University of Glamorgan and UWIC and the University of Newport in order precisely to get that critical mass, yet everything seems stalled. Are you going to get that moving?

Professor Gummett: There are two parts to your question if I understand it correctly, one about critical mass in research and the other about critical mass in relation to teaching and so on.

Q792 Alun Michael: And profile.

Professor Gummett: If one were designing a higher education system for Wales from scratch---

Q793 Alun Michael: You would change the geography.

Professor Gummett: That would be quite helpful, but it would lose many of the distinctive features which make it attractive, so it would be double-edged, but it probably would not end up looking like it does. Part of what we are trying to do therefore - and this has been going on since 2002 - is to encourage our institutions to be more ambitious, not to say we are this size in this place and all we can manage therefore is to go for these kinds of prizes.

Q794 Alun Michael: Is this a yes then?

Professor Gummett: On south-east Wales do you mean or more broadly? We certainly think there are issues in south-east Wales. When the discussions took place several years ago, following the publication of the Assembly Government's Reaching Higher strategy, there was as you will be aware discussion about potential mergers. We saw a business case consultation document published which seemed to my council to make a compelling case - and we said so at the time - for that merger to go forward, and we were quite disappointed and made that very plain at the time when eventually it did not go forward. The logic of it did seem to us to be very well expressed in the document that was put out by the institutions themselves. Since then there have been various flurries of activity and you will no doubt be aware that the current minister and the First Minister have put in train further work on that, and we shall see what that comes to. On the more general picture the issue is about trying to recognise that we are where we are in terms of the distribution of institutions and their current size, but we can make a lot more of it by working together.

Q795 Alun Michael: With respect - and I do not want to take too much time - if the argument is that compelling, is it not something that your council ought to be more compelling about?

Professor Gummett: We operate within a legal framework which we have to respect, so that does provide us with a counter to this. In other areas we are seeing something very positive. For example, not much talked about is what is going on in south-west Wales where very quietly and very modestly, but really quite innovatively, between Swansea University, Swansea Metropolitan University and Trinity College, Carmarthen there is now a triangular relationship which is integrating a whole series of their administrative functions from student records and libraries, and it offers all sorts of possibilities for developing higher education in that region. I am not aware of anything quite like that in the rest of the UK in terms of the range of activities that they are seeking to bring together.

Alun Michael: It sounds a compelling message.

Q796 Mr Martyn Jones: Is there adequate UK-wide co-ordination of higher education policy at a government level?

Professor Gummett: Which House and which government?

Q797 Mr Martyn Jones: You take your pick.

Professor Gummett: There is an issue. You heard earlier about the issues in relation to DIUS and I made some comments fairly directly about the Treasury in relation to the RAE and the Medical Research Council earlier. We make the point in our submission to you that perfectly naturally and understandably it seems to us there is a concern from the devolved point of view about the way that DIUS will now work because it just seems absolutely natural if you have within one organisation the responsibility for research councils and the responsibility for English higher education to start to look for ways of building something greater out of those parts, but the problem is that the research councils are UK-wide and we might have the Medical Research Council story all over again. We are concerned about that and we are also concerned about the way that so many documents emerge from Whitehall that show, from our perspective, insufficient awareness of differences across the UK. I might cite the Sainsbury Report and I hope I am right in saying that there are only two reference to Wales in that document and both of them are incorrect; there is a reference to a no longer existing WDA and a reference to the fact that we apparently fund the further education sector which we do not. It is disturbing when one finds a report which is ostensibly about the UK science and innovation system and to then read it and either see things like that or to say to oneself is this about England only or is this about the whole of the UK; it is not an uncommon experience to find it quite difficult to be sure which is meant, and if there are funding consequences what they are. I do think therefore that there is an issue here about understanding in Whitehall about devolution. It takes two to tango though so I am not trying to place all the responsibility at one end of the relationship.

Q798 Mr Martyn Jones: How effective then is the UK-wide co-ordination of workforce planning - you probably heard the question before about healthcare professionals and teachers?

Professor Gummett: That is quite difficult for me to answer because we do not intercept with it in the way that the question implies. The discussions that go on between universities and the health services on either side of the border about nursing, paramedical and so on are ones which they conduct, we do not directly engage in those. The discussions that take place similarly on teacher training across the border - we are not involved in those discussions but we are involved in trying to administer changes within Wales on teacher training but we are not involved in any sort of forum.

Q799 Mr Martyn Jones: Should you be, given that you are supposed to be funding it?

Professor Gummett: The medical world is a very separate world from us lesser mortals I often find and there seem to be ways of taking things forward in that field which seem to us sometimes to seal themselves off as it were from the rest of the world, but it would not hurt to have some scope for wider discussions on this. In saying that I am honestly not sure what the right mechanisms would be and it has to be reflected too and understood too that in the area which I do know something about, which is teacher training, the modelling work which is done within the Welsh Assembly Government to determine how many teachers it believes should be trained in Wales, is done with very careful attention to what is happening in England, so the modelling for Wales takes account of what is happening in England, it is not as if it is just ignoring it or anything like that. Whether it is done right or wrong history will tell, but I know that there is if not join-up in the people talking to each other, then certainly in the modelling that goes on there is very careful analysis.

Q800 Mr Martyn Jones: Do you know if that modelling takes place in the healthcare area?

Professor Gummett: I do not know how it is done in the healthcare sector so it would be wrong for me to try and answer it.

Q801 Mr David Jones: I would like to ask you about funding for cross-border collaborative projects. We have had a submission from Cardiff University which says that "There is great potential for highly production collaborations between Cardiff and English HEIs but there are challenges in securing funding for such initiatives from the respective funding Councils. There are often common interests and objectives across the UK and, as such, it would be helpful if the various administrations could consult and consider a common way forward." Do you recognise these obstacles to collaborative projects?

Professor Gummett: No. I have been in discussions with Cardiff University - since you mention the particular case - for several years now about cross-border collaborative possibilities. We have had discussions with the English Higher Education Funding Council about this and we established with them a very clear understanding that if a proposal came from a university on the Welsh side or the English side of the border about doing something jointly, we would each look at it according to our normal criteria for making decisions. People come with ideas all the time and sometimes we would say yes and sometimes not, so we would each look at the proposal according to our normal criteria and if we both felt there was advantage in it, we would find a way to fund it. It is true to say that there are some legal constraints here and since we have not yet crossed that bridge there might be some stumbling blocks that we have not identified, but we do not think that should actually be very difficult at all. If one thinks of a jigsaw puzzle I do not see why we in Wales should not fund the Welsh piece and the English funding council fund the English piece, slot the two together and make something that is bigger than the sum of the parts. Basically, that is the advice that both funding councils have given the universities involved in that discussion and said to them, "Come back to us with a coherent proposal and we will look at it." That is where we start.

Q802 Mr David Jones: Cardiff is not very happy with that though, are they?

Professor Gummett: I would have to ask them.

Q803 Mr David Jones: This is what they tell us.

Professor Gummett: They have not come back to us with a proposal; I would like to see the proposal.

Q804 Mr David Jones: If it resolves itself to a question of policy and the policy varies on either side of the border then the project is less likely to succeed.

Professor Gummett: I am sorry, perhaps I have not expressed myself very well. We have not had a concrete proposal; we have had suggestions and ideas but I appear before audit committees and I am not going to advise my council to commit millions of pounds to something without proper due diligence and a proper proposal, and we have not had that. We have gone back to Cardiff and the other university with whom they are talking, or our English counterpart, and said bring us something we can get our teeth into and look at properly and we will see what we can do, but at the moment we have not had anything. I do not think it is the case that there are policy barriers and what we have both said, both the English funding council and ourselves, is that if there were then we would aim to break them down because we think if it makes sense to do something then we should find a way forward.

Q805 Mr David Jones: What are the legal constraints that you mention?

Professor Gummett: Unless I discover anything else, at the moment our understanding is simply that we could only fund the Welsh end and the English funding council the English end of a joint activity, but we do not see any reason why, that said, we should not do that, so as long as the two pieces of the jigsaw fit together in some sensible fashion and we both think there is a benefit and advantage according to our normal criteria for investment, we do not see why we should not do it.

Q806 Mr David Jones: Can you give us some examples of successful cross-border collaboration?

Professor Gummett: Of that sort, university to university, of the kind that they are speaking of there, no, because we have not had any proposals come through to us, but in other contexts, yes. We work with the research councils on joint arrangements. For example, Bangor University has a centre for bilingualism research which is co-founded by the Economic and Social Research Council and ourselves; we have a Wales Educational Research Network, similarly co-funded by ESRC and ourselves; we have joined the Engineering and Physical Sciences Research Council in a number of ventures where they have been trying to build scientific research capacity across the UK and the other funding councils have gone in the same way, and we have all said that if the winner of one of these competitions falls in one of our territories we will come in with funding as well. There is actually a case which involves Cardiff where I guess we would have to say it is a very complex funding package, because Cardiff is part of a consortium led from Lancaster University in the field of operations research where the funding is now coming from EPSRC, the English funding council and the Welsh funding council, so we do those things and we find ways through any little difficulties that might crop up. We are quite open and I do hope I have not given the impression that I see any serious barriers in policy terms to the sorts of things we are speaking of, but what we do need is a serious worked-up proposal that we could analyse, do due diligence and take a proper view.

Q807 Mr David Jones: Would not such projects be easier if there was simply one funding council?

Professor Gummett: Possibly, but equally one might lose the advantages of being able to play both ends against the middle. The key thing in all of this - and it goes back to our earlier discussion about winning research grants - is actually getting ideas and proposals; are they there, are they good?

Q808 Chairman: If I could pursue this question of research funding, during the period of HEFCW's existence have you succeeded in improving the proportion of funding that came from the research councils? In your memorandum you note that it is lower than in England and you say it is about 3.5%. How has that varied?

Professor Gummett: It has not moved much over the five years now that we have been trying to work on this. It is a difficult problem, for the reasons I outlined earlier, and of course it is dynamic. It is dynamic because everyone is raising their game, so all the English, all the Scottish and all the Northern Irish competitors for research council funding are also raising their game and in that sense actually staying still is itself not an inconsiderable achievement. Our problem is that in order to get up to what we think would be a more appropriate figure like 4.5% - given that Wales is about 5% - as in the racing metaphor I used earlier, we are running from behind and we have therefore got to run faster. The issue then is about being able to invest in order to run faster. That said, we are doing - as we indicated in our evidence - a number of things, and the research councils have been very helpful in this regard, they have laid on various kinds of events in Wales to come and talk about what they do, tell people about their priorities, give help on how proposals get written and those kinds of things. A series of things is being done about this, therefore, but it is a tough one and we are simply holding the line.

Q809 Chairman: But a decade ago all this was happening, it was clearly identified a decade ago. You used the word earlier in your evidence of ambition and a lack of ambition, would it be the case that you are also part of the problem as well in HEFCW in that you also lack ambition?

Professor Gummett: I would accept the charge that we are part of the problem in so far as we are not able to invest more heavily in this area than we have done because we are stretching the funding in other dimensions as well and we have to have balance across the whole array. We have already pushed funding latterly in the direction of research, but there is a limit to how far it is essentially safe to do that without starting then to do damage to the teaching, which is of course the major part of the activity of the universities. We have made submissions on various occasions in the public spending rounds to say how we would use additional funds if they were to become available. Short essentially of robbing teaching to pay research there is a limit to what we can do in that direction, and that is why we are going down the line instead of trying to encourage more ambitious proposals and to encourage restructuring to underpin. The game in winning the really big research prizes is about having teams with scale and scope, that they would be large enough but also covering enough inter-related research areas to be credible competitors against similar teams elsewhere. Given, as was explained earlier, the scale of most of the departments in our universities, that is a tough one and the way we are trying to go forward is through collaboration. That we are seeking to do quite actively I submit.

Q810 Chairman: You have already touched earlier in your evidence upon the problem of making the Department of Innovation, Universities and Skills aware of the Welsh dimension; how can you tap into the UK-wide elements of that department more effectively? Do I get a sense that there is a dialogue that is only going on with the Welsh Assembly Government and you are not really reaching out to Whitehall and Westminster at all? Have you met the Secretary of State for Wales, for example?

Professor Gummett: Personally, no.

Q811 Chairman: Why is that?

Professor Gummett: Simply that there has not been an occasion where it has arisen; there has not been a natural occasion for doing so.

Q812 Chairman: Some of these problems are easily addressed - I am not saying solved - if you actually knock on his door because he is the voice of Wales in Whitehall and Westminster.

Professor Gummett: With respect what I would say is that we convey the message into these departments frequently enough, the problem is a problem of culture and personnel. It is one thing to put a message in at the top - and I accept that perhaps there is more that we should do there - but the problem then is that it is the instinct that arises out of working in an environment where the focus is predominantly English. Then when you combine that with the turnover of staff, what you find is that you have developed relationships with one set of officials and they have changed, there is another lot now, and so you have to start again. There is a tension, therefore, in the dual functions of DIUS and it was there to a degree in the DTI before as well. We have to be a bit realistic about it; we are a very small part of the UK, we are 5%, and although we will trumpet loudly and proudly about what we do, it is also easy to understand how, if you are dealing with the 80% odd that is England, it is quite easy simply to forget - not to be malicious in doing so but simply to forget. That is part of what I mean about the cultural dimension.

Q813 Alun Michael: Could I just come in on that because given that Wales is a small proportion of the whole of the UK does that not mean that we need to do more for people to understand the distinctions, understand the needs of the higher education sector in Wales, and that therefore the Welsh Assembly Government should be encouraging you to take on a sort of ambassadorial role for higher education in Wales. Is that encouraged or discouraged?

Professor Gummett: It is encouraged. I shall be going back to Cardiff this afternoon and back to tomorrow evening to go to Central Hall for the launch of the concordat on researchers, which I submit is part of this public relations role, being there simply to be seen to be there along with the other parties.

Q814 Alun Michael: My point is really that you said a few moments ago that the same problems existed when we had the Welsh Office and DTI, as indeed they did. There is always a changeover of staff within Westminster departments, it is the bane of everybody's lives, but it is also the way that people get experience and develop so it means that you have got to accept that as a fact of life. I am not clear in your response to the Chairman whether you are actually doing the foreign service part of HEFCW's job with the enthusiasm that perhaps is necessary.

Professor Gummett: Others would have to judge that, it would not be for me to do so.

Q815 Alun Michael: I was asking you to judge it.

Professor Gummett: I would say I spend a great deal of my time - for example, there is an organisation called Funders' Forum which brings together all the funding bodies and research bodies. That is a high priority activity for me. It is meeting in a couple of weeks time in London and I am cancelling other things to be at that. I come to things in London frequently in order to make sure that Welsh higher education ---

Q816 Alun Michael: Do people go away from those meetings saying "Gosh, the really impressive bit was that guy who came and represented those exciting universities in Wales"?

Professor Gummett: You would have to ask them that.

Chairman: Thank you very much for your evidence today.