Peers have accused the Government of taking a ¡°shameful and retrograde¡± step in merging its universities department with the business department.

In a debate in the House of Lords, Lord Mandelson, Secretary of State for the new Department for Business, Innovation and Skills (BIS), heard concerns that further and higher education had been ¡°subsumed¡± into a ¡°mega-department¡± and were deemed ¡°not worthy¡± of even a single letter in the department¡¯s acronym.

Although there was a close relationship between industry and universities through research, universities were ¡°not basically about improving competitiveness or building industrial strategy¡±, Lord Baker of Dorking asserted.

They were ¡°essentially custodians of scholarship, intellectual rigour and world-class teaching¡±, he said.

³ÉÈËVRÊÓƵ

He asked what Lord Mandelson¡¯s priorities for the department would be, because ¡°the Prime Minister said that there are 13 priorities for his department. Universities are fifth, further education colleges seventh.¡±

He continued: ¡°Does he realise that this year we will see the largest number of applications by students to go to university in our history and that 50,000 will not go because of education cuts in his department?¡±

³ÉÈËVRÊÓƵ

Lord Hunt of Wirral congratulated Lord Mandelson ¡°on his remarkable accumulation of responsibilities, titles and junior ministers¡± and suggested that ten ministers in a department was ¡°surely a record¡±.

¡°I understand that he has also now added outer space to his portfolio. His ambition indeed knows no bounds.¡±

In the business world, he said, there was said to be no such thing as a merger; only takeovers.

¡°Does he agree that it is a shameful and retrograde development that further and higher education have been subsumed in this way, to be judged not worthy even of a single letter in the new departmental acronym?¡± he asked.

Lord Howarth of Newport asked Lord Mandelson whether he would affirm that the Government valued research, teaching, knowledge and ideas ¡°as goods in themselves, as aspects of civilisation, and not just as means to advance material prosperity¡±.

Meanwhile, Baroness Sharp of Guildford asked whether Lord Mandelson was aware of ¡°a famous book about mergers called Disappointing Marriage¡±, which pointed out that mergers could quickly create ¡°diseconomies of scale¡±.

Lord Bishop of Portsmouth ¨C who declared an interest, as a graduate, in ¡°dead languages and¡­ in what some people regard as dead ideas¡± ¨C said that while no one would question the managerial abilities of the secretary of state, he was not sure that Lord Mandelson had provided a philosophy for last week¡¯s merger of the Department for Innovation, Universities and Skills (DIUS) with the Department for Business, Enterprise and Regulatory Reform (BERR).

³ÉÈËVRÊÓƵ

¡°I go further and suggest, perhaps in the interests of creative facetiousness, that we might look forward to further mergers, such as a merger of the Exchequer with health,¡± he added.

³ÉÈËVRÊÓƵ

But Lord Mandelson insisted that the creation of the new department made sense.

¡°The two departments have completely complementary roles and even some duplication of expertise,¡± he said, adding that BIS would not be the first department to have more than one priority.

¡°As a liberal arts university graduate, of course I fully appreciate the role played by universities in building up not only our country¡¯s competitiveness but its character and its scholarship. I am committed to all of those things,¡± he told the House.

Lord Mandelson said BIS would ¡°help the economy come through the recession stronger, more competitive and able to grow in the future, fostering our world-class system of higher education to help this objective and enrich our society¡±.

It would provide help to businesses, universities and colleges, and to UK workers and students through training, skills, lifelong learning, first-class science and technology, further education and research policies.

Lord Mandelson said he was ¡°very proud¡± of the Government¡¯s record on higher education, and would ¡°certainly defend it¡±, as would his colleague, the MP Pat McFadden, Minister for Business, Innovation and Skills, in the House of Commons.

¡°The new department will combine BERR¡¯s strengths in shaping the enterprise environment and analysing the strengths and needs of various parts of British industry, with DIUS¡¯ expertise in maintaining world-class universities and expanding access to higher education, and its responsibilities and skills in developing our further education sector,¡± he said.

¡°We have a new phoenix in this department, which will take flight from the merger of two previously excellent departments and will be able, I hope, to extend its reach to outer space and beyond.¡±

³ÉÈËVRÊÓƵ

rebecca.attwood@tsleducation.com