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David Willetts is President of the Resolution Foundation. He was Minister for Universities and Science 2010-2014. His book A University Education is published by OUP.

The invasion of the Ukraine and its heroic resistance is of course dominating our thinking. As David Gauke pointed out yesterday on ConservativeHome, this has diverted attention from the Chancellor’s Mais Lecture, which set out his economic strategy more clearly than any Budget which inevitably has to focus on specific measures.

On the same day Nadhim Zahawi and Michelle Donelan set out a higher education and skills package which complemented the Chancellor’s approach. Together, they add up to a coherent strategy for the public finances and also boosting productivity.

The case for the education package is simply that graduates earn more than non-graduates and it makes sense for graduates to pay back for their higher education provided they can afford it. This is the moment to quote Karl Marx – as I used to do at meetings with the National Union of Students. He objected to a plan from the German Social Democrats for taxpayers to fund higher education because: “[if] higher education institutions are also ‘free’, that only means in fact defraying the cost of education of the bourgeoisie from the general tax receipts”.

Theresa May ignored his wise words, and increased the repayment threshold above which graduates start paying back, so that half of graduate debt was going to be written off by taxpayers. That is far too much.

Phil Augar was commissioned by May to look at reforms to the system. Ironically, his main proposed reform is to reverse her own increase in the threshold, and extend the repayment period so that now only about 20 per cent of graduate loans will be written off. I always envisaged that the typical graduate should expect to pay back in full and that taxpayers should only help those who for whatever reason had unusually low earnings. The package very persuasively explained by Michelle Donelan in her piece on this site last Thursday gets that balance right.

It will not just get the public finances back on track. I hope it also provides an opportunity to get the whole Tory approach to higher education back on track. Many young people and their parents aspire to go to university – all of us out canvassing have seen the photograph of the child or grandchild in graduation robes on the mantlepiece. But Conservatives seemed to be getting into a mind-set that universities are the enemy.

I suspect many readers of ConservativeHome believe that over 50 per cent of young people going is too large a proportion. Indeed, I am surprised how often I am told it must have happened because we in the Coalition slavishly followed Blair’s target.

But I never believed in any such target. It has happened because of millions of personal choices – and carried on increasing, despite our making it clear that, as graduates, they would usually have to pay back for the cost of their university education in full. Participation is also over 50 per cent in countries like USA and Australia with relatively flexible labour markets and fewer protections for big industrial employers. It is not some eccentric English experiment.

Opinion surveys show very few young people regret going to university, though more do come to regret their choice of subject – and there the problem is early specialisation.

If too many people are going to university then this social problem is most acute in prosperous Tory constituencies where participation is over 60 per cent – such places as Wimbledon, Hitchen and Harpenden, Rushcliffe and Tatton. By contrast, my former constituency of Havant had low rates of young people going to university. I could see that if the only way for more young people from the tough council estate in my constituency to get a place was for fewer to go from Chelsea or Beaconsfield, then they were in for a long wait.

That is why I am against number controls. The Government is now consulting on some specific ones, but I think it would be very hard to make them work effectively and fairly.

Do all these graduates then become Labour voters? Just occasionally Tories, get close to Trump’s notorious remark that ‘I love the poorly-educated’. Three years of higher education does change people. Graduates are more liberal and individualistic. The more education they receive, the more likely they are to create their own businesses – doctorates are increasingly a route to a tech start-up not to academia.

Graduates have better health and longer life expectancy – not because they are somehow better people, but because of the effects of access to higher education. They are more tolerant of alternative views and more likely to vote. They are more more sceptical of the state. Whenever I met students, they were not focused on destroying capitalism: instead, they were unhappy that it took so long to get their essays back and that wifi coverage on campus wasn’t very good. Even the Woke agenda did not preoccupy them – though it is a serious issue which I hope to turn to in a future column.

The real political problem for Conservatives is not graduates, but young people in general, whether they go to university or not. A graduate earning £28,000 shouldn’t be turned into a socialist because she has to pay back £17 a month. What does turn them away from us is the retreat from the property-owning democracy. It is the difficulty of getting started on the housing ladder and the lack of any kind of company pension matching the one their parents got for themselves.

Ministers rightly want more adult learning and more vocational education – it was a key theme of the Mais Lecture. That must be right. But universities as well as FE College are key agents for this. More than half of university courses are vocational. There is the exciting new initiative of higher apprenticeships, but there are many other ways in which university courses link with employers – from being accredited by employer groups through to including a sandwich year in industry. Many doctoral students are now co-funded by employers and tackle a research problem directly relevant to an innovative company.

The Chancellor identified skills, investment and R&D as his three main routes to boosting the real economy. Universities are key to all three. I include investment because a lot of overseas investment comes from companies attracted by the quality of our universities for their recruitment and business innovation.

There have been times over the past few years when our party was in danger of becoming hostile to universities and the young people and their families who aspired to go. But last week’s two important statements boost my hopes that we are getting out of that dead-end. The real battles as we can see this week are so very different.