Why do the Tories keep talking about Blair’s 50 per cent target?

Rishi Sunak’s recent attack on higher education expansion as ‘one of great mistakes of the last 30 years’ leaves questions on economics and politics

November 2, 2023
Montage showing Blair behind a university, Sunak in front of it
Source: Getty Images/Alamy/iStock montage

On 11 February 1999, a seminar led by the UK’s then Labour prime minister Tony Blair made what was recently described as “one of the great mistakes of the last 30 years”.

The meeting had nothing to do with war, or taxation, or the UK’s relationship with the European Union.

According to a memo from Mr Blair’s principal private secretary, the seminar – also attended by the chancellor, the education secretary, the trade and industry secretary and a clutch of advisers – endorsed a particular policy recommendation: “We should set a target of 50 per cent of 18 to 30-year-olds being able to enter higher education by the end of the next parliament (subject to a discussion on costs and priorities).”

That target for England ended up as a line in Mr Blair’s Labour conference speech in 1999. But the Blair target took up several more lines of prime minister Rishi Sunak’s Conservative conference speech in 2023.

Last month, Mr Sunak said the Labour government had “pursued the false dream of 50 per cent of children going to university and abandoned apprenticeships. This assumption that the only route to success was the university route was one of the great mistakes of the last 30 years.

“It led to thousands of young people being ripped off by degrees that did nothing to increase their employability or earnings potential.”

Universities in England have grown used to criticism from Conservative government ministers, amid the party’s shift towards non-graduate voters since the Brexit vote of 2016. But the prime minister’s attack on the Blair target took that to a new level, beyond his previously announced crackdown on “rip-off degrees” (plans for a limited system of student number controls).

Mr Sunak’s intervention leaves an economic question: what evidence is there about the impact of higher education expansion on the national economy since the Blair target?

And it leaves a political question: why is a Conservative prime minister so keen to talk now about a 24-year-old Labour announcement?

The original proposal for a 50 per cent target came in a Number 10 Policy Unit paper written by David Soskice, then on secondment in the policy unit, now emeritus professor in the department of government at the London School of Economics, and James Purnell, who went on to become a Labour Cabinet minister and is now vice-chancellor of University of the Arts London.

A briefing note by Mr Purnell suggesting answers Mr Blair might offer on questions about the target (among papers on the development of the target seen by Times Higher Education) summarised the policy’s intent: “Important to be ambitious – going to higher education key to productivity and to meeting aspirations. Is target of 50% enough?”

Conservative critics of expansion have also focused on the question of productivity. In July 2020, the Department for Education said a speech by then education secretary Gavin Williamson would “tear up the target to send 50 per cent of young people to university” (despite the target, actually for higher education rather than university participation, having already been met and not been cited as policy since Labour left office in 2010). The DfE press release also said that “productivity is just 4 per cent higher than it was in 2008” despite expansion.

Iain Mansfield, former adviser to Mr Williamson in the DfE, now director of research and head of education at the thinktank Policy Exchange, echoed this in his recent call for legislation to cap undergraduate numbers and “rebalance” funding to further education. “Over the last 25 years the number of students attending full-time higher education has risen dramatically,” yet “during this period, UK economic growth and productivity has stagnated”, he wrote.

However, the DfE’s very own analysis has recently shown a different picture.

In February 2023, the DfE published a paper by consultancy London Economics, on “estimating the contribution of educational attainment to productivity growth” (growth in output per hour worked) since 2000.

Relying on data sources such as the UK Labour Force Survey, it used two different approaches – growth accounting and econometric.

The growth accounting, which looks at the contribution of different factors to growth, suggested that the “contribution of changes in labour composition towards productivity growth is positive and generally stable across time”, and that those changes in labour composition were “predominantly driven by the increase in employment share accounted for by graduate and postgraduate qualifications” (the econometric analysis did not find such a link between education and productivity growth).

Gavan Conlon, co-head of the labour and markets practice at London Economics and a co-author of the analysis, said it “demonstrated that the ‘quality’ of the labour force contributed to economic growth, and the productivity gap is predominantly driven by other factors – such as the lack of capital per worker.

“Without the increase in the proportion of graduates in the labour market, the productivity deficit experienced by the UK would probably have been even worse."

The analysis for the DfE chimes with another growth accounting analysis, carried out in 2022 by the Tony Blair Institute for Global Change, which argued that, as other factors in growth such as investment in physical capital and take-up of new technology lagged, the “very modest economic growth that we’ve experienced in recent years has been propped up in large part by human capital and in particular expansion of education”.

David Goodhart, author of Head Hand Heart: The Struggle for Dignity and Status in the 21st Century, a prominent critic of expansion, has objected to “an extraordinary amount of magical thinking about the beneficial impact of higher education on productivity, economic growth and social mobility”.

Mr Goodhart, head of demography, immigration and integration at Policy Exchange, said of criticism of the Blair target: “It’s become part of the narrative quite broadly in the country, certainly on the political centre right.”

He argued the proof of “over-expansion” was shown by growth in graduate numbers far exceeding the growth in managerial and professional jobs over the past 20 years. “We’re not creating the demand [for graduates]…The number of these jobs is not increasing as fast as the supply of people who want them.”

Against that, Professor Soskice, originator of the target alongside Mr Purnell, maintained it was “one of the three best things the Blair government did”.

He said: “A target was needed because if you’ve got a target there the civil service seems to adjust to it as a goal it has to get to…The Treasury’s commitment – that’s a really important thing to have.”

In terms of the economic argument behind the target, “quite a lot of it was saying if you look at the countries we would like to be on a level with – the United States, South Korea, Japan – they all have high participation rates”, he added.

What about the politics of Mr Sunak’s comments?

Rob Ford, professor of political science at the University of Manchester, co-author of Brexitland: Identity, Diversity and the Reshaping of British Politics, said: “The underlying political motivation seems obvious: which is that university graduates have become steadily more anti-Conservative in recent years.”

But the shift in the balance of the electorate towards graduates has “an awful lot of momentum behind it” as older voters, a significant majority of whom are non-graduates, “gradually disappear from the electorate”, continued Professor Ford, author of a forthcoming report for the Social Market Foundation on education as political divide.

“It’s a bit like Canute trying to declare war on the sea, really,” he added.

In addition, he said: “Most voters, across the education divide and across the age divide, tend to think university is a good and valuable thing…If you say to them ‘do you want your kids or grandkids to go to university’, they will emphatically say yes to that.”

In any case, in practice rather than rhetoric, current Conservative government policies – to create the lifelong learning entitlement, to promote degree apprenticeships – would mean ever-increasing numbers entering higher education.

Still, Mr Goodhart said he saw an “extraordinary lack of emotional intelligence in the announcement that 50 per cent of school-leavers should go to university”, demonstrating that it had not occurred to Mr Blair “or anyone around him” to think about “the 50 per cent that weren’t going to go”, who were effectively told they were “second-class citizens”.

Professor Soskice stressed that the original target plan “envisaged a significant expansion of two-year degrees linked to local employment opportunities”. That never materialised – and perhaps might have given expansion even broader social reach.

Nevertheless, is the Blair target a key factor in what has happened to non-graduates – an issue of huge political and social significance – in recent decades?

Professor Soskice noted that, in the wake of the Blair expansion, graduates headed for the UK’s handful of “high-density clusters” such as London, Oxford, Cambridge or central Manchester. “There, productivity zoomed up,” he said. “We had really flat, if not declining, productivity in other places.”

Politicians invoking the Blair target as a spectre still haunting society might be ignoring far larger “great mistakes” made by governments since the Thatcher era: about Westminster centralisation driving regional inequality, about the underfunding of further education, about the absence of industrial strategy to shape the kinds of companies and jobs we have, about failures to manage a response to deindustrialisation that worked for the whole of society.

More than what Mr Blair said in a speech in 1999, perhaps those decisions by governments were bigger factors shaping the choices of a majority of young people now, who have looked at the kinds of jobs they might get without higher education and decided higher education is their best bet.


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Reader's comments (8)

Go into any grandparent's front room in the UK and there on the mantlepiece is a proudly displayed photograph of a grandchild or children in graduation robes. Not from an apprenticeship, but a university, and most often from the first generation of that family to attend. The Conservatives have got it wrong if they seek to denigrate this, it's a symbol of getting on for most, and it won't wear well in the heartlands. The shameful underfunding of FE is another matter, let them right this longstanding wrong.
Why does Sunak keep banging on about Blair's target? Two reasons: 1. It's about 'aspiration' and no matter what they might say, the Tories are not about assisting anyone to better themselves. 2. It's easy to blame someone else instead of looking at your own failures.
The problem with the larger number of graduates in the economy is that now jobs that previously required 5 O levels and could be started right from school demand a degree which has saddled the person applying with a huge debt for no reason. An arbitrary figure of 50% of the population going to University only makes sense if there is a matching number of jobs requiring that level of education, and paying salaries accordingly.
The argument that there "too many graduates" simply highlights the UK's post-WWII failure to develop a dynamic, advanced modern economy that could and should be absorbing those graduates to drive innovation and productivity. Instead, our economy has relied too much on low-productivity, low pay models. Topping up poverty wages with benefits is a massive taxpayer subsidy to companies, and disincentivises investment to improve productivity.
The excellent John Burn-Murdoch wrote an article for the FT a few days ago asking why graduates in the US earned far more on average than those in the UK. Was it an oversupply of graduates as the government argues? His data analysis showed that the two countries had broadly similar numbers of graduates in the population. The issue lay on the demand side. The US economy had invested and innovated and therefore needed far more graduates, and employers competed for them, driving up earnings. The UK on the other hand, with its poor record of investment and innovation over recent decades didn't have the same demand for graduates. The problem for Burn-Murdoch was not an oversupply of graduates but an undersupply of graduate jobs. And the long-term poor performance of the UK economy was the outcome.
In addressing the current narratives we should ask ourselves what is happening around the world in respect of higher level skills and knowledge. Most of the world are seeing higher proportions of the population accessing higher level skills through a variety of different pathways. Degrees, Apprenticeships, micro credentials all designed to equip current and future generations to meet the challenges and opportunities of a changing world. If the UK has an ambition to be a leading global knowledge economy we should recognise that we need to create more opportunity for generations who have the talent, aspiration and ability to access higher levels to do so through whichever pathway works for them. Government should not crush aspiration and access. They should be creating the opportunities and environments that can help deliver high quality, sustainable and relevant provision.
"Professor Soskice stressed that the original target plan “envisaged a significant expansion of two-year degrees linked to local employment opportunities”. That never materialised – and perhaps might have given expansion even broader social reach". Foundation degrees are precisely this vehicle, which are successfully being delivered in many FE colleges, enhancing the employment opportunities for many young, and not so young, people all over the country.
The real problem started with the Further and Higher Education act in 1992 - Major's Tory government. They did away with apprentice-type polytechnics etc. If we'd had say 25% at University and 25% at polys Sunak might be happy.