Shortly after Labour’s election victory in June a senior Oxbridge academic happily predicted a period of ‘benign neglect’ in our dealings with universities and our approach to higher education. In fact, there will be no neglect, benign or otherwise. We are dedicated to building a strategic plan that looks forwards a decade or more and underpins our vision of higher education. This rests on a commitment to further expansion without any compromising of standards.

We want more graduates. Over the next ten years, there will be a need for more than 1.73 million new jobs in those occupations that have typically recruited graduates. They are an economic necessity if we want to compete on the world stage as a high value, high skills economy. This is why we made a commitment shortly before the general election, repeated in the manifesto, that 50 percent of those under the age of 30 would enter higher education by 2010.

This will not be attained unless we address the link between social class and education attainment. The statistics in higher education are frightening. About 70 percent of children from middle-class backgrounds now go into higher education compared with fourteen to seventeen percent of children from less privileged socio-economic backgrounds. The expansion over the last decade made higher education a universal right for the middle classes, but it remains a privilege for working-class children.

No-one can possibly believe that richer children are brighter than poorer children or that children from the inner cities are fundamentally unable to achieve at the rate of those from the suburbs. So to fulfil our pledge we must raise the educational attainment of children from those communities that have traditionally under-achieved. That, in turn, means raising standards in schools. We have to tackle the haemorrhage of young people out of full-time education at sixteen. Only Greece, Turkey and Mexico have a worse record than ours in participation after sixteen.

However, even that challenging ambition is not going to be enough by itself. We have to raise aspirations and self-belief so we can counter the attitude of some young people, even the brightest, that higher education cannot be for them. At present, 44 percent of young people from lower socio-economic backgrounds never even hear about university as an opportunity for them during their school days. Universities must put down roots in our secondary schools so that the presence of somebody from higher education does not just happen once a year before A-levels but becomes the norm.

Finance comes to the fore whenever we talk about student access. We are thinking again about the obstacles that could discourage young people from low-income families from going into higher education. We have begun a review of the current system of student finance and we have clear aims.

The system ought to be simpler, especially in the areas of hardship support, and provide more upfront support for children from less well off backgrounds. We want to tackle the problems of debt and the perception of debt, especially if that is stopping children from lower income backgrounds trying. But we need to bear some facts in mind. Under the present scheme, 50 percent of students pay no contribution at all towards their fees and only one-third of students pay the full fee. And the full fee only covers a quarter of the actual cost of tuition; the rest is funded by government. Moreover, graduates still enjoy a premium on their earnings; lifetime earnings are 35 percent above average earnings. The principle that graduates, who personally benefit, should contribute towards the costs of their higher education remains right. What we need to examine is whether we have the balance right between the contribution from the graduate, their family and the state. And we need to look at whether the profile on the repayments is appropriate.

Our review of higher education will not focus solely on student funding – important though that is. We want to see how we can better support research excellence in our institutions. As we widen participation, we must focus more on teaching standards in higher education. We want to see whether we can provide a different set of incentives, which will encourage institutions to focus on what they do best, rather than assuming a ‘one size fits all’ for all universities.

We want to take further steps to strengthen the links between higher education, regional economies and local communities. We want to look at the system of accountabilities to ensure we provide appropriate information to students, their families, employers and the funders. Our review processes must be proportionate and encourage continuous improvement.

To fulfil our agenda, we need first class management and leadership. Too often there is no effective management at key levels. Moreover, no-one can defend the low number of women in the top echelon of higher education management.

Our current review provides an important opportunity to look forward and to establish clear principles for the role of higher education over the next decade.