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Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
It is a pleasure as ever to serve under your chairmanship, Mr Robertson. I am delighted to have secured this debate on an issue vital to the future of the British economy: skilling up our adult work force. I am particularly pleased to stand here and highlight to the Minister the excellent provision we have in Hackney. I am proud to represent Hackney community college, our local further education college, which really is what it says on the tin. It provides education and training to a community of people, many of whom did not have the chance the first time around. Indeed, some may have arrived in the country without the benefit of skills, education and training in the countries they came from. They are ambitious to achieve, ambitious to learn and ambitious to work, and the college provides great support to them.
I am aware that many other colleagues want to speak, so I will try to keep my opening remarks as brief as is reasonable. I want to talk about funding, in particular for FE, and about apprenticeships and skills. We all know that funding for over-18s has always been complex because the bureaucracy of Government means that, sadly, funding falls between at least two Departments and sometimes more. The Minister has a challenge in that he represents only one section of the funding for adult education. I appreciate that limitation, but I hope that, in his role, he has the clout to bang heads together for the joined-up government that every party strives for. That is particularly important in adult learning, because if the system does not work, learners fall through the gap as well as providers—I will touch on the challenges for providers as well.
Tracking funding and ensuring that the provider and the learner can deliver the contract between them is difficult, because Departments focus on their narrow financial interests rather than the whole experience of the learner or the needs of the employers, which are critical. That was stark in a previous Westminster Hall debate, when we discussed how the Department for Business, Innovation and Skills had cut funding for over 18s—we had a different Minister at that time. That debate aroused cross-party concern about both the impact on the viability of education providers and the disproportionate impact on many 18-year-olds. That debate can be seen as a proxy for some of the challenges faced by many other learners across the age ranges.
Funding has also been catastrophically reduced over the years. Between 2009 and 2015 alone, there is a 35% reduction in the adult skills budget—the core budget for FE—and during a similar period, the number of people aged 19 and over participating in Government-funded training, excluding higher education, has dropped from 3.7 million to 3.28 million, so nearly half a million fewer people are getting their learning and training provided.
Will the Minister tell us whether the Government have any plans to introduce more ring-fencing of budgets, or will they allow local colleges and providers to meet local needs? Hackney is an exemplar of the latter: the college embraced the needs of the Olympics, when it provided training for the catering—it has an excellent training section—and is embracing the needs of Tech City, where it is pioneering its apprenticeships, working with employers. That has served the needs of local businesses and therefore, crucially, enhanced the employment prospects of students in the local area. Many other colleges up and down the country can and do provide similarly, but flexibility is important.
The adult skills budget is the main source of funding for FE colleges, but it is not the only source for adult learning. I believe that a strong, effective FE sector is vital to Britain’s future, but those colleges face a slew of funding changes, and I make a plea to the Minister, who is new in his role, to look at that seriously. All Governments have done that, but often during a year or at very short notice funding is withdrawn or drastically changed, and short-term initiatives are given funding designed to bolster a political announcement, which makes it complicated for colleges and providers to deliver and is often detrimental to learners.
There could be many examples of how the system is broken, but I do not have time to go into them all. One example is this: the number of ESOL—English for speakers of other languages—students in Hackney would have reduced by 35% but for the £400,000 paid by the Department for Communities and Local Government. When one Department withdraws funds, another often puts the money in, but that adds to the disjointed picture I have painted and, in a constituency such as Hackney South and Shoreditch, and in a borough such as Hackney, what could be more important than skilling up Britain by ensuring that those basic language skills are in place?
What plans does the Minister’s Department have for the adult skills budget in future years? I highlight in particular the £340 million reallocated from the adult skills budget to the employer ownership skills pilots up to 2015-16. How much has been spent to date, how many individuals have started those training courses, how many have finished them and where can MPs get routine information about how that money is spent? Both the Library and I had great difficulty in finding that, so I hope that, in a spirit of openness and transparency, the Minister points us in the right direction.
We have a shared interest in ensuring that we have the best possible quality of education in FE. We also need to recognise the vital role FE has in working with many adults who have had bad learning experiences in the past, and for whom simply attending class regularly is the first big achievement.
I am a regular visitor to Hackney community college, but I remember not long ago meeting two interesting learners, one of whom was training to be a painter and decorator. He had not enjoyed school and had failed to achieve basic qualifications in English and maths—that happened not in Hackney, but in another borough. He was unable to read. To look like the other commuters, he pretended to read Metro on the tube every day, but he could not read even the headlines. With support from his excellent tutors at the college he learned to read, and in a few months he was reading Metro for real. Such achievements may not be a great leap forward in academic terms, but they were a big achievement for him and, critically, they enabled him to progress in his chosen career rather than be condemned to a limited choice of low wage, unskilled jobs. That is the nub of the issue.
I also met a young woman, who is a mother of a young child, who similarly had not enjoyed maths at school, but, as she was training to be a chef, she could see the point in it. Again, she had support from Hackney tutors to ensure that she could get those necessary basic maths skills. For many, FE is a second chance at education, but, whether a first or second chance, it plays a vital role. Too often, however, it is the Cinderella of education. It needs to be on a more stable footing. Although we all want more money invested in training and education, my bigger plea is for colleges to be given the freedom and stability to make their own sensible decisions.
The Government have made many claims about the increase in the number of apprenticeships created. I would never be critical of the creation of new opportunities for young people, but we need to look at those claims carefully—they should be heavily caveated. The number of apprenticeships for over-24s has increased, while for 16 to 18-year-olds it has decreased in most areas. An added problem is that, in many areas, 16-year-olds are competing with A-level students and A-level students are competing with graduates for those valuable opportunities, so we are seeing inflation of apprenticeship competition. Sought-after apprenticeships require more interviews than a university place: the Rolls-Royce apprenticeship interview process is longer than that for Oxbridge.
We need to get back to the heart of apprenticeships: training on the job, for a job. We also need to ensure progression and opportunity for apprentices. I know that there is genuine desire in the Government to ensure that apprenticeships are a real opportunity, but we all hear bad stories about them not truly delivering. In Hackney, for example, I am approached every few months by yet another provider keen to provide tech apprenticeships in Shoreditch. They always want a base in Shoreditch and most want to go it alone—they do not want to collaborate with existing providers. Employers tell me that they are getting confused and potential apprentices have to shop around. The quality of the education is often unclear and difficult to assess for both the potential apprentices and the employers. I am not saying that there should be one single provider, but we need much more clarity on quality.
Information about apprenticeships should be clearer and quality control needs to be rigorous. Employers such as Optimity in Shoreditch, which has been in the vanguard of the tech apprenticeship set-up, is embracing that initiative. Such employers have a vital role to play—clearly, without employers, the apprenticeships go nowhere —but they need a simple route to working with the right education partner and ensuring that that apprentice gets good quality in both their training and their education. That requires more accountability and monitoring, such as that required of FE colleges. We all want high-quality apprenticeships, so we must be wary of watered down offers.
On the skills deficit, as MP for Shoreditch, which includes the international tech hub that is often called Tech City, I frequently meet business innovators who know what skills they need but cannot recruit people with them locally. Admittedly, the sector is fast-moving, and it is difficult for schools and colleges to keep up with the fast pace of change. For Britain to be successful and competitive—an ambition shared by all parties—we must ensure we have a highly skilled population that can compete with the best from around the world. Tech City is an international hub, not only because it competes internationally, but because it attracts people from all around the world to invest and work. For young people in Hackney to have a chance, we must ensure they are trained, but we must also ensure that adults can train to fulfil employers’ needs now and in future. We must not only equip school leavers, which we are doing effectively in Hackney, but provide opportunities for adults to take high-level skills training.
On the political side, there has been a lot of discussion about the UK Independence party and the sort of people who support it. There is a danger because many people in my constituency have been left behind—particularly men in their 50s who have skills but no paper qualification to prove it, who have never had a driving licence or a passport, who still live at home with their parents, and who cannot provide the paperwork and skills qualifications needed to take on the jobs that they are skilled up to do. I met a 56-year-old who had none of those things. He got training through the Olympics as a security guard and had all the right bits of paper. Although he was unemployed when I met him, he felt confident that he was ahead of the pack. However, there are many people in his position who have been left behind and would benefit from proper skills training.
The Department for Business, Innovation and Skills equality analysis showed that women students, students from black and minority ethnic background, and those from inner city areas are dropping out disproportionately from higher-level qualifications since loans for higher-level courses were introduced—sadly, Hackney ticks all those boxes. People are increasingly doing shorter, lower-level qualifications. I hope the Minister shares my concerns about the long-term inequality that problem creates. What does the Department intend to do to tackle it and prevent inequality from becoming imbedded in the system?
The number of students on advanced courses dropped by 20% between 2012 and 2013-14—one in five students fewer in only one year—according to research by the Association of Colleges. Are the Government liaising with business sectors to ensure that the future work force is appropriately skilled, and are they assessing the impact of that dramatic drop in numbers on Britain’s competitiveness?
The CBI and many other key business groups have called for the skills deficit to be tackled. I believe passionately that helping workers to retrain is vital. I have given an example from my constituency, and I meet many men and women from up and down the country who have been out of the workplace for a while, perhaps because they had children or a health problem. It does not take long for skills to get out of date, and it would be more cost-effective for the Government to have a strategy for retraining for higher-level jobs, because when people get those jobs they pay more tax.
In Hackney, the cost of rent, child care and housing is so high that many working families are trapped in a cycle of working poverty. As I was preparing to speak today, I received a heartfelt tweet from Sarah, who said:
“I would do anything to go back to some kind of adult learning to better my work skills so I can get a better job and hopefully be able to provide for my family and not be reliant on tax credits.”
Sarah speaks for so many of the forgotten people who work hard but have no realistic chance of skill development because minimum-wage employers often provide little or low-level training and the loan makes it impossible for them to think about higher skills training. There is great poverty in my constituency, but no poverty of ambition. The Government must revisit the impact of loans and assess what can be done to iron out the inequalities in the system.
My final point is about a real concern that I have. For some time I have talked about this issue, but too many people are still being taken off courses by the jobcentre when they are close to completion, even if the course would lead to longer-term, sustainable and better-paid work. The issue particularly affects parents, and usually mothers, whose present on their child’s fifth birthday is to be told that they cannot complete the course they have been doing for a few years because they need to seek employment immediately.
Hackney community college has done great work in negotiating for students, some of whom require only a week or two to complete their course. The cost of an additional couple of months’ benefit is minimal compared with the higher wage those people will earn with a good qualification under their belt. The additional tax they will pay and the fact that they will be less reliant on tax credits and benefits, as Sarah highlighted, will more than pay for it. I know the Minister’s influence does not extend to every part of the Government, but I hope that he, as Minister with responsibility for skills, will take that up with the Department for Work and Pensions. It is not dole for learning, but a sensible approach to skills training. It would be awful to condemn the many single mothers in my constituency to low-level, minimum-wage, low-skill employment for the sake of a few weeks of unemployment benefit, which would be a much bigger investment in their future, the future of their children and the future of Britain.
John Robertson (in the Chair)
Order. A number of people wish to speak—I count eight all together. If hon. Members keep their speeches between roughly six or seven minutes, we should get everybody in within a decent amount of time.
Kate Green (Stretford and Urmston) (Lab)
I appreciate your calling me now, Mr Robertson. I have a constituent in the House whom I need to meet in the next few minutes, but I hope to return to the debate to hear as much of it as I can. I am grateful to Government Members for allowing me to follow my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier).
I congratulate my hon. Friend on securing the debate. There are some issues I wish to raise with the Minister. I want to take the opportunity to acknowledge publicly the excellent Trafford college in my constituency, which I had the great pleasure of visiting during adult learners week earlier this summer. It was a joy to spend time with the adults who were returning to education after many years and to see the enthusiasm with which they were embracing their studies and the obvious reward they felt they were getting from participating in adult learning.
I echo my hon. Friend’s comments on student loans. I wish to ask the Minister what monitoring is being undertaken of the effect of further education loans on older students’ take-up of further education. We know from the trends in higher education that the impact of student loans on younger students has not been as significant as some of us feared, but mature students have significantly fallen away from higher education studies because they find it difficult to take on a debt obligation alongside other financial obligations that they have accrued. What trends has the Minister observed among those over 24 years old, and what further monitoring and adjusting action will the Government undertake if the loans significantly deter adults?
I wish to ask the Minister about funding for HND and HNC qualifications, which are offered in further education colleges such as Trafford. My understanding is that the qualifications are currently funded by the Student Loans Company, but that a Higher Education Funding Council for England weighting is added to fund courses that partly contribute to a degree-level qualification. I have been told that it has been proposed that the funding will switch, and that in future those qualifications will be funded by the FE loan company. Will the additional weighting—the funding supported by HEFCE—be transferred across so those courses continue to be fully funded?
I am sure the Minister will understand that those studies have particular economic importance, given what they encompass. People who take up technically complex subjects can make a significant contribution to our economic situation, and it would be a great shame if funding pressures began to discourage some students from participating.
I support what my hon. Friend said about apprenticeships, and I would be grateful to hear the Minister’s comments on the funding issues. As the Association of Colleges has observed, the current funding arrangements, in which the Skills Funding Agency funds the college and the employer pays an apprenticeship wage, amounts to a pretty significant subsidy for the employer because they get a fully-trained employee without having to contribute to their college training.
I understand that those arrangements are to be replaced by an employer contribution and a tax break for employers. Does that mean that employers will continue to receive a subsidy, and, if so, will it have the same overall effect? If there is to be a change in the funding structure for apprenticeships, what assessment have Ministers made of the likelihood that small and medium-sized enterprises will continue to offer or increasingly offer apprenticeships? SMEs are an important source of apprenticeships for the future, and it has been difficult to get them to engage with apprenticeship programmes. I would be interested to hear from the Minister what assessment has been made of the effect of the funding arrangements on SMEs’ participation.
Vulnerable adults in particular can find FE studies a flexible and environmentally suitable approach to continuing their learning. We have some good, supported training programmes at Trafford, and throughout the country, for younger students with learning disabilities. For example, some good supported internship programmes, organised between local employers and local colleges, run well. Those supported internships are not funded for over-25s, although we know that adults with learning difficulties, for example, will take longer to reach the point at which they are ready to participate fully in education and employment.
Is the Minister prepared to consider whether the effective and successful supported internship model, which works for younger adults, could be extended to older adults in those situations? It is not a quick fix—I am not asking the Minister for an instant answer—but I think that we would all appreciate hearing that he will take an interest in the subject. Those of us who have thoughts and ideas about the issue, including charities that I have worked with, might work with him to see what might be possible in this field.
Finally, let me say a little about the role of employers, particularly in relation to employer ownership of skills, which is a good idea in theory that is proving difficult to make effective in practice. I should be interested to hear how the Minister intends to improve its effectiveness. The uptake is quite low and what is lacking, if I may say so, is a strategic economic context to employer ownership of skills. I particularly commend to the Minister work done by the Greater Manchester chamber of commerce, which analysed all the many major construction projects that we expect in Greater Manchester over the next five to 10 years—High Speed 2, the Metrolink extension, an extension at the airport, new investment in Trafford Park in my constituency, the northern hub and so on—and mapped the job needs that will arise under those projects, right down to individual jobs. The work included identifying how many electricians, scaffolders, painters and decorators each project is likely to need, what level of skills will be associated with those jobs and when they are likely to come on stream.
Clearly, the next step is to start matching all those fantastic data to training and education plans in our FE colleges, schools and universities. However, there is a mechanism missing that might otherwise connect that economic analysis with the education providers, particularly FE colleges. Will the Minister comment on whether he would be interested in exploring that further, as I am sure Greater Manchester chamber of commerce would be keen to do?
Mr Marcus Jones (Nuneaton) (Con)
I congratulate the hon. Member for Hackney South and Shoreditch (Meg Hillier) on securing this important debate. We have some excellent FE provision in my area, but I want to make a few comments about two FE providers in particular and the challenges they face.
North Warwickshire and Hinckley college is the provider of most of the practical and vocational technical education to my constituents. Over the past five or six years—probably since 2009—its budget has, as the hon. Lady mentioned in relation to provision in her constituency, been reducing year on year. To be fair to the organisation, it has coped well and has been positive.
One of the most positive things that the college has done—obviously, it has had to reorganise—is to make a change towards supporting the local economy more, aligning its strategy with that of the local enterprise partnership. That is now paying dividends. It is also now far more engaged with local employers; it is in constant discussion with them, trying to see how the jobs market will be and how it will serve that market in providing skills. That approach has been particularly positive in relation to apprenticeships, which have increased by 78% in my constituency during the past four years, helping us to reduce youth unemployment in my constituency by 40% over the past 12 months.
We must not get away from the fact that, despite the good work done by North Warwickshire and Hinckley college in difficult circumstances, we need to ensure that we fill a growing skills gap, particularly in engineering and other types of manufacturing and the construction industry. If we do not think carefully about how we are going to deal with that, we could leave organisations such as North Warwickshire and Hinckley college unable fully to fulfil the potential of young talent and fill the skills shortage. We should deal with that, rather than go down the route favoured during the last economic upturn—of having many people from other parts of Europe, particularly, and other places abroad, come in and do jobs instead of ensuring that we gave the right training and skills to our people here. I hope that my hon. Friend the Minister is listening to what I am saying about the support needed by colleges such as North Warwickshire and Hinckley college.
King Edward VI college is a dedicated sixth form provider that has been through the same difficulties in relation to funding changes since 2009, and other circumstances have made things difficult. First, the presumption in favour of outstanding schools also being able to open sixth forms has challenged the offer that it has been able to provide; the previous Government started that and the present Government have, to an extent, carried on with it. That continues to be an issue for this college. There are also issues about inequity to do with VAT rules relating to dedicated sixth form providers, which my hon. Friend the Minister no doubt knows about. The college has also had an issue in relation to changes to funding for providing sixth form courses for 18 to 19-year-olds who perhaps have not had the best start, for whatever reason, or have not achieved as well as they expected.
King Edward VI college has also been badly let down by the Skills Funding Agency, which has not supported its providing part-time adult A-level courses, leaving a gap in my area with virtually no provision for people who want to do part-time A-level study after work.
Despite all the necessary, difficult decisions that have been made to start dealing with the budget deficit left behind by the previous Government, what has been achieved has been positive. However, my argument is based on a warning for the future. We need to be careful about how we approach funding for sixth form and FE colleges, to ensure that we have those skills to take our economy forward, beyond the positive start that this Government have made.
Pat Glass (North West Durham) (Lab)
It is a pleasure to serve under your chairmanship, Mr Robertson. I, too, congratulate my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier) on securing the debate, and I welcome the Minister to his post. We have entertained one another through two Education Bills, when he was a lowly Parliamentary Private Secretary, so it is good to see him in his elevated position.
Pat Glass
Indeed.
We have heard that FE is the Cinderella tier of the education service. Although successive Governments have attempted to put additional funding into the primary and secondary sectors and—perhaps to a lesser extent—into higher education, tertiary or further education has long been underfunded and undervalued. However, all previous neglect pales into insignificance when compared with what we have seen since 2010.
It is becoming clear that the pace and scale of the most recent FE cuts is having a devastating impact on adult learning and the long-term economic future of this country. The Department for Business, Innovation and Skills has cut spending on the adult skills budget by 35%, with total spending falling from £3 billion in 2009 to £2 billion now.
The Department has, I acknowledge, chosen to protect a number of areas financially, and I welcome that. Community learning, offender learning and financial support for individuals have all been protected, and those who receive benefits or take courses at the lowest qualification levels continue to receive free courses, but I think—perhaps cynically—that that is more about massaging the unemployment figures than it is about improving learning. Funding for apprenticeships has been protected, so that the number of apprenticeships for those aged 24 and above has increased, but arguably it has increased far too quickly and at the expense of good outcomes, quality and younger apprentices. All that is forcing FE colleges to subsidise free training for adult apprenticeships at the expense of younger students. Even with all that, employers are still not prepared to deliver on their responsibilities. The Government have transferred £340 million to the employer ownership of skills pilots up to 2015-16, but so far only 20,000 students have started a training course through those pilots.
We have already heard about FE loans, so I do not intend to say very much more about that, except to bring Members’ attention to the recent research commissioned by the Association of Colleges, which highlights that the number of students on advanced and high-level courses who now require a loan, but did not in the previous year, has declined by 20%. It has gone from 107,200 students in 2012-13 to 84,300 in 2013-14.
In addition to the cuts imposed directly on FE colleges budgets by BIS, the Department for Education has also cut funding for students aged 18 and above. Although that is operational across the educational sector—it affects schools, special schools, sixth forms and so on—the most vulnerable students will be hardest hit, and most of them will be in the FE sector. Students over 18 on courses funded by the Department for Education are most likely, as we heard, to have missed periods of education, or have special educational needs, or be those who just need an additional year; a little more time to get the GCSEs that their peers were able to achieve at school. They are the young people closest to being NEET, and the evidence shows that such students will primarily be in the FE and adult learning sectors. When I questioned the former Secretary of State for Education, the right hon. Member for Surrey Heath (Michael Gove), he said that he regretted the decision to cut 18-plus funding, but that it was the best worst option. The former Secretary of State left office with a £1 billion overspend on free schools and academies, but still saw the best worst option as being to cut funding to the most vulnerable students, the people closest to being NEET and the most likely to cost this country dearly over the next 45 to 50 years if we do not get it right for them now.
We have a strong higher education sector in this country, with a strong research base that is recognised internationally, but only 40% of our young people go to university. For the remaining 60%, good quality alternatives to full-time degree study are reducing. We need a rebalance towards technical and vocational education, and that is vital in ensuring the continued and sustainable growth of the economy. The last 50 years have seen a continuous gravitational pull towards academic education, which has accelerated since the conversion of polytechnics to universities. Academic is seen as good and vocational as bad, and anyone with any sense knows that we cannot build a sustainable economic future on that kind of foolishness. We have a skills shortage across the economy, and it is not going to be filled by a couple of city technology colleges and the odd engineering-based free school. We need a sustainable and high quality route to technical and vocational education, and that route is being systematically damaged through unsustainable FE cuts and the march towards the amalgamation of FE colleges.
Adult learning is at the heart of bridging the skills gap, and FE colleges are perfectly placed to deliver in a skills shortage. They are experts in the area. Following years of investment by the previous Government, many have state-of-the-art facilities, are widely respected by local employers and are at the centre of their communities. We need to maintain that, stop cutting the heart out of our adult learning and FE systems and recognise their role in our recovery.
Paul Blomfield (Sheffield Central) (Lab)
It is a delight to participate in this debate under your chairmanship, Mr Robertson. I join in the congratulations to my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier) on securing this debate. I thought she set the context extremely well. By focusing on one particular aspect of the funding problems faced by Sheffield college, I hope not to take up too much time. I will try to illustrate or further illuminate her narrative by outlining how some of the decisions are forcing counter-productive choices on the college. They are counter-productive for students, for the local economy and for the Government’s objectives in so many areas.
Sheffield college is a strong institution. It is well regarded and well rated by Ofsted. It has strong managerial leadership and a chair of governors who is the chief executive of the local chamber of commerce. The college is focused on the needs of students, the local economy and employers in the area. It addresses those needs through direct provision and by contracting the delivery of some courses out to businesses and, as I will highlight, social enterprises and third sector organisations, which are particularly adept at reaching some of the more vulnerable and harder-to-reach sections of the community.
The hon. Member for Nuneaton (Mr Jones) illustrated the challenges that many colleges face in addressing funding issues. Like the examples he gave, Sheffield college has been thoughtful, flexible and innovative in trying to address those challenges, but it has lost almost £1.6 million this year from its adult learner responsive funding. One way in which the college has been forced to respond to that substantial loss of funding is by retrenching and ending its contracts with providers that make an important contribution to adult learning.
One particular area that has felt the impact is the teaching of community-based English for speakers of other languages. Learn for Life Enterprise is a social enterprise and one of a number of providers to Sheffield college. I know it well. I have spent time with it and seen its excellent work within the community, giving adult learners the opportunity to gain confidence and English language skills, and through that to begin to engage effectively and productively in the local economy. Not only are the courses under threat, but these enterprises are being put at a tipping point where they might go under. The cuts have an extra leverage—a disproportionate impact—on the role that Learn for Life Enterprise plays. Similarly affected will be the work of the Yemeni Community Association in Sheffield, which engages with its community effectively in one of the most deprived areas of the city, developing those language skills and that confidence and engaging people in the economy.
All that negative impact is being forced on the college through the Skills Funding Agency by a Government who rightly stress the importance of learning and speaking English as an entry route into effective engagement with the economy, as well as its importance for community cohesion and wider integration. I have written to the Skills Funding Agency, asking for the allocation to Sheffield college to be reviewed, to give the college a little more space to continue its important provision or, as a fall-back, for Learn for Life Enterprise and the Yemeni Community Association to secure direct funding. The SFA has simply told me that its hands are tied, because the cuts, devastating as they are, simply reflect the overall 8.5% reduction in the adult skills budget. On direct provision, it said that because the providers are so small, they fall below the level at which they could effectively contract directly. That is a double whammy for this provision. Does the Minister think this is a wise saving? Does limiting opportunities for people to develop their language skills fit in with the Government’s stated intention to get more effective integration and to get more people into work, or does he agree with me that reducing opportunities for people to gain the communication skills and wider skills necessary to engage with the economy is a false economy? Not only is it affecting them as individuals and our local economy, but—for a Government that has cracked on quite a lot about the big society—it is fundamentally undermining third sector organisations, which make a big contribution. I look forward to his response.
Nic Dakin (Scunthorpe) (Lab)
As always, it is a pleasure to serve under your chairmanship, Mr Robertson. I congratulate my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier) on securing this important and timely debate, and the way she set out her case so clearly.
Adult learning has long been a passport to fulfilment. It helps raise aspirations and transforms lives. I recognise the magnificent work of all those engaged in adult learning and all the teachers, support staff and managers who help deliver it. They are wonderful people making a real difference to the lives of others, often working in partnership with employers. I have welcomed winners of the Keith Fletcher memorial access awards to Parliament every year since I was elected. It has been a real pleasure to recognise their achievement, and it has been wonderful to welcome access students from North Lindsey college to this place each year as part of their course.
By and large, this and the previous Government’s record on apprenticeships has been positive. There have been many examples of excellent practice in my constituency, including the outstanding Tata apprenticeships and the work that North Lindsey college has done with North Lincolnshire council. The spotlight on apprenticeships has improved the quality of the brand, and that is to be applauded. However, just as we had proper concerns about short Train to Gain courses being branded “apprenticeships”, the time is now right to ask hard questions about how to further improve apprenticeships’ quality, so that they best serve the interests of employers, learners and the state. The number of 24-plus apprenticeships has risen rapidly, largely through Government funding. It is important to be rigorous in asking whether employers are discharging their obligations to these learners simply by paying them the minimum wage. Should employers contribute more to ensure that certain apprenticeships do not end up as a significant Government subsidy for large, profitable companies?
Conversely, the change in funding when an apprentice turns 19 might act as an unhelpful disincentive for small employers to take them on. As a result of 45 local employers writing to me, I visited Side by Side in Hull to hear for myself the very real concerns employers have about the changes the Government are pursuing to route apprenticeship funding through employers. That is not what businesses want. We have an opportunity with a new Minister. I hope he will listen carefully to what employers are saying about putting wholesale funding for apprenticeships through pay-as-you-earn. As the shadow Minister, my right hon. Friend the Member for Birmingham, Hodge Hill (Mr Byrne), has said, this could turn out to be a disaster. Careful evaluation of how the package of support for learners and employers is performing would be highly valuable in informing how to improve further the quality of the apprenticeship product.
The debate is an opportunity to consider how to reshape post-18 learning for the future. We need to develop stronger alternatives to full-time degree study, with clear technical and vocational pathways through FE colleges. The Government could actively consider ideas from the Association of Colleges and National Institute of Adult Continuing Education to create secure adult learning accounts, into which the individual, the employer and the Government could contribute. Such accounts could be put in place for all adult learners, whatever pathway they choose to take, and thereby bring greater parity between academic and vocational routes. Another thing Government could do, which ought to be relatively easy, is to provide secure, three-year budgets for colleges to give greater planning certainty to institutions. That would help colleges to make decisions early and maximise not only the value for every pound they spend, but the interests of their adult learners.
The best FE colleges and training providers have the connections and expertise to bring the world of work and education together in a way that benefits all partners. One of the most challenging areas is in turning round the life chances of the long-term unemployed. I commend the work that North Lindsey college has done with Jobcentre Plus to give unemployed people the skills to succeed and get them into employment. I also echo my hon. Friend the Member for Hackney South and Shoreditch, who urged the Minister to look at the ways the Department for Work and Pensions can work more creatively, to the benefit of local communities, and not apply rules that anyone with any common sense can see act as a barrier to allowing people to develop.
Much has already been said about the immense impact of funding cuts on this sector. I will say a few things about the 17.5% cut in funding for 18-year-olds. I know from personal experience as a former college principal that these students have often struggled to reach the expected level by the age of 18. They can ultimately achieve success, but only with appropriate study support, personal mentoring and so on. These are the highest-risk students and we are now making them the highest-cost students as well. This could create perverse incentives and results.
Let me give a few North Lindsey college examples to illustrate these students’ success. Oliver joined a preparation for employment painting and decorating course last year. He started with no qualifications, a history of behavioural problems and poor school attendance. Ultimately, he achieved qualifications for the first time in his life. He has now opened and is running his own shop. He also wants to continue his education.
Kirsty started at a care home as a volunteer on work experience from Jobcentre Plus. She was initially very shy and negative about education. She suffered from dyslexia and had low self-esteem. She now has qualifications for the first time and is the face of her company, appearing on its website. She has made a promotional video to support future staff.
After little success at school, Lima enrolled on a level 1 caring for children course in 2009. She has since done level 2, level 3 and level 4 courses at the college and is training to be a teacher. Those are the sort of successes FE colleges can deliver.
Here is an opportunity, as the general election approaches, for all political parties to demonstrate that adult learning is at the heart of the opportunity to change our society for the better. Adult learning needs to be properly funded in a stable environment to allow colleges to deliver effectively for their communities, learners and business.
Mr Khalid Mahmood (Birmingham, Perry Barr) (Lab)
I thank my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier) for securing this important debate.
By and large, FE has always been seen as the poorer partner of other forms of education, predominantly because people like me managed to come through it. I managed to get an apprenticeship when I left school; I did not have great A-levels so I was fortunate to get that. It gave me a huge chance to get into engineering and follow through. I certainly hope that many others will now have the same opportunity, because it offers a last chance.
There are currently some serious challenges in Birmingham, such as high levels of unemployment, which, in some of the inner-city areas, are three times the national average. These colleges and further education institutions support unemployed people. People over the age of 19 are still finding it difficult to find employment. We need to look at that. In my constituency, the areas of Lozells and Handsworth have significantly high unemployment. We need to see what we can do to support those people.
We have a good college that is willing to look at that. I share with the shadow Minister, my right hon. Friend the Member for Birmingham, Hodge Hill (Mr Byrne), responsibility for South & City college, which crosses our constituencies. It is doing a tremendous amount of work, particularly with training in its construction, motor vehicle and electrical training centres, and with other vocational training. It is doing an absolutely fantastic job to get some of those people in areas of high unemployment into jobs.
We have good manufacturing companies that need support, but the current arrangement for over-24s needing loans for level 3 courses prevents a lot of people already in employment from training. That is particularly the case for those aged over 24 who have managed to get a job and who, because technology and practices move on, want to progress or maintain themselves in their work. They want to be able to develop in that way and find it difficult when they are presented with the requirement to get further qualifications for which they must take out loans. Those are the most studious ones, because they want to make a difference. I see that in my constituency, where young people have started out from the local jobcentre and have progressed to management. I pay tribute to them, because they are prepared to give their own time for further training.
There are world leaders in advanced manufacturing in my constituency. I appreciate their work, because I am an engineer. Truflo is the world leader in submarine valves and at the moment is probably the only company for hull valves for submarines and surface ships. It does a fantastic job. It was an honour for me to take my hon. Friend the Member for Plymouth, Moor View (Alison Seabeck), the shadow Minister for Defence, around the site about 10 days ago; it was fantastic to show off some of the good work being done, and the apprenticeships there. Other companies include TRW—the skeleton that came out of the old Lucas works. It does fantastic work to develop technology, but we need support for the 19-year-olds and the over-24-year-olds, so that that can continue. We want to reduce the current high employment levels.
Dana is another very good and reputable engineering manufacturing company in my constituency and I want to keep it there and bring more advanced manufacturing to the area. McGeoch is just over the road in Ladywood, and I was privileged to visit it with my hon. Friend the shadow Defence Minister. It does a huge amount of fantastic work with ceramics, but it needs to do some development; the obstacles it encounters include getting apprentices to follow through with the huge amount of manufacturing it is doing. It provides components for satellites for NASA. It is fantastic to have that happening in Birmingham.
The EEF apprenticeship centre in the city takes on 300 apprentices from local employers, and some of the companies that I have mentioned use people from there. It has not had a penny of funding; it has done that through contributions from engineering employers in its patch. I should be happy to take the Minister around it, if he wants to come and look at the great work that it is doing. I hope he will take the offer up. As I said before, South & City college is doing a fantastic job in my constituency. Wilmott Dixon also does a lot of work with apprenticeships in construction and housing, such as electrical stuff. It is also now doing training for the installation of solar panels. Again, that is a private scheme that it has taken on without any funding.
I go along with my right hon. Friend the Member for Birmingham, Hodge Hill, the shadow spokesman, over the bid for an HS2 maintenance depot in Birmingham. We have the colleges and training places, and I hope that that will be passed on in relation to the bid that he has made, which I fully support.
A key issue is funding for 19-year-olds and those aged 24-plus. One of the key requests from South & City college is for provision for English for speakers of other languages. Demand is currently twice what it is providing. If we are to reduce the unemployment rate of three times the national average in inner city areas, we need an appropriate supply of training, so that the college can make a start with those people. People are eager and knocking on the college’s door, wanting to take part. They are not hanging back. We need to deal with that, to get people into employment. There is a huge amount of interest. Many community and voluntary organisations want to provide support, but they cannot because of funding cuts. I urge the Minister to review the situation and think about how we can start to rejuvenate some of our inner cities.
There are many contributory issues outside the further education debate; if people—particularly young people—are not in employment, that makes work for idle hands. I urge the Minister to think about those things, and about the comments of my hon. Friends, which I think were all valid. Further education is a huge sector, and a fantastic one for people who need its vital support. I urge the Minister to continue to support it, and to fund it properly.
Kelvin Hopkins (Luton North) (Lab)
It is a pleasure to serve under your chairmanship, Mr Robertson, as it was to hear the excellent speech of my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier), and all the speeches that have been made. All the hon. Members who have spoken made positive and useful comments and I hope that the Minister will pay attention to them.
The focus so far has been on employment-related learning, but the title of the debate is adult learning, which I think goes beyond that. I had experience of teaching in further education in the 1970s and I know the sheer joy of adults coming back to study—particularly at evening classes—subjects that perhaps they did not have a chance to do at school. They might not have had any academic qualifications, but their eyes would be opened and they would see life with more possibilities because of what they studied at evening class.
In those days, certainly in Luton, we had better provision than now. The colleges and schools in Luton are excellent, but in those days we had a technical college with a language laboratory where people could learn a variety of languages, including even Swedish. We had a further education college with all sorts of engineering courses that people could do for fun, as well as those related to work. There was a range of subjects.
I saw friends transformed by the experience of going to an evening class for a modest fee. They would sign up, having had no real academic experience, and would come out with an A-level. A friend of mine did A-level government and politics and got a grade B, and her life was transformed. She was a single parent and could not afford expensive education, but she did an evening class. Subsequently—it was not directly related—she became, and eventually retired as, a lecturer in further education. That resulted from the leap forward she made by doing an A-level.
Mr Gregory Campbell (East Londonderry) (DUP)
As to the transformational effect that adult learning can have, does the hon. Gentleman agree that for many people, particularly in deprived communities on large working-class estates, such opportunities open doors? If they do not get that opportunity, the door is closed for a generation, because in many cases the fathers and grandparents of those people were also unemployed.
Kelvin Hopkins
That is a valid point. During my time teaching in further education in the 1970s I not only took evening classes but taught day-release students for what was called liberal studies. That is nothing to do with Liberalism with a capital L, of course. I saw young people whose view of the world might be very narrow suddenly opening up to the possibilities. They started to understand politics, believe it or not, and a range of other subjects that I used to talk about in those classes. The experience was enhancing and enriching for them. It made their lives different. They went away thinking, “I have had my eyes opened to new possibilities in life that I never thought I would have.”
Initially, sometimes, there was a bit of hostility, because of resentment at “these clever people coming and talking about subjects I know nothing about”; it took time. I had one experience of a class that insisted at the end of term on dragging me to the pub to buy me a pint, because they enjoyed their time with me so much. I think that was the biggest compliment I was paid. Working-class young men, who were particularly alienated from education, were changed by having a bit of a good experience, and I am glad I made a contribution.
I was for 10 years co-chair of the all-party group on further education, skills and lifelong learning. I emphasise the term “lifelong learning”, which is not just about getting on a course to get a job; it is about one’s whole life. One can go on studying all one’s life—most of us do, in one way or another—but some people need the opportunity to have people who know things talking to them in a friendly way at an evening or day-release class, to open their eyes to the possibilities of the world.
I had those experiences, but something really disappoints me now. Luton has a wonderful sixth-form college, of which I have been a governor for 21 years. I am now the vice-chair of governors, and the college has a brand-new building and superb teachers, but it is unable to put on evening classes because funding for adult education in sixth-form colleges has been cut and it receives statutory funding for 18-year-olds and below only.
The teachers want to teach adults, and adults want to be taught by them. The fabulous building is unused and empty in the evenings, but it should and could be used for education in this conurbation of perhaps a third of a million people. If someone wants to study a European language, for example, they cannot do that in-class in Luton anymore. The possibilities exist, but such areas need specific funding. We cannot just say to sixth-form colleges, “Get on with it. Put on an evening class if you want, but you’ll get no more money.” It would not happen, because teachers need to be paid and perhaps more teachers would be required.
From my experience, teachers enjoy the variety of teaching adults as well as youngsters. Adults often have a positive effect on classes, because—I am trying to be polite about young people—they are more likely to behave themselves and to be positive about education. They can also actually have a maturing effect on younger students, so mixed classes can be a good thing. We are preventing potentially millions of people from studying things that they would like to learn simply because we will not fund non-statutory adult learning.
I hope that when the Labour party forms a Government in a few months’ time, they will hear this message and start to rebuild the kind of evening classes that we used to have when I taught in the 1970s. I hope that millions more people will be able to study not only for work, but also to enrich their lives and to enjoy the simple pleasure of knowing things.
John Robertson (in the Chair)
Before I call the Front-Bench spokesmen, I want to thank all speakers for sticking to the time limit.
Mr Liam Byrne (Birmingham, Hodge Hill) (Lab)
It is a privilege to serve under your chairmanship, Mr Robertson. I congratulate my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier) on securing the debate. She has always been a fighter for her constituency and for Hackney college, and she reminded us this afternoon of why we need to spend more time debating this subject, for which we are grateful.
I want to draw out a couple of remarks from today’s debate and to sharpen the points of some of the questions that my colleagues have asked the Minister, but I will start by discussing the skills crisis that so many businesses up and down the country are now confronting. Report after report has been put before us over the past two or three years, all basically saying the same thing: there is a skills crisis in Britain that is holding back growth, destroying productivity and keeping people trapped in the cost of living crisis that has bedevilled this Parliament. KPMG reports that a third of manufacturers would like to reshore work back to this country, but cannot do so due to a lack of skills. The Migration Advisory Committee, which was set up when my hon. Friend and I were at the Home Office, has now added 100 different roles to the shortage occupation list. As a result, under this Government, we have imported 282,000 workers because their skills could not be found at home. In a recent report, Mike Wright, the chief executive of Jaguar Land Rover, said:
“We must double the number of engineering apprentices qualifying at advanced level…by 2020.”
Lord Adonis has said that skills are
“the single biggest impediment to economic growth.”
Report after report says the same thing: we have a skills crisis in Britain that is holding the country back.
The impact on productivity in this country has been devastating. We used to have a phrase for that in public debate—the British disease. A crisis of productivity means that we do not produce as much in this country as the rest of the world produces. Today, the productivity gap is 21% against the G7, meaning that what the rest of the G7 finishes producing on a Thursday night takes us until the end of Friday to complete. There will be no escape from an economy of low wages unless we increase productivity. As the Royal Society puts it:
“Unless we get smarter, we will get poorer.”
As we have heard this afternoon, the problem is not just one of productivity, but one of poverty. Before the summer, we published a big report in Birmingham about child poverty, which has led to a 40% spike in the number of children presenting in A and E units having tried to take their own lives. The majority of children in poverty in Birmingham are in families where people are working. How do we raise family living standards in a great city such as Birmingham? There is only one way: raising productivity and therefore raising skill levels. We have heard this afternoon about a £958 million cut in the adult skills budget. Overall, taking into account other cuts in capital, but also the injection of money in from 24-plus loans, nearly £900 million has been taken out of adult skills over this Parliament. The impact is that fewer adults are enrolling in skills courses.
Kelvin Hopkins
My right hon. Friend is making an excellent speech about the importance and lack of skills and opportunities. The reality is that we are still importing some 15,000 graduate engineers every year to work in an industry that even now is too small. Manufacturing in this country is half the size as a proportion of GDP than that of Germany, and yet we still cannot find enough engineers from among our own people. Something is wrong and I hope he addresses it.
Mr Byrne
I certainly will.
Money is tight, and I noticed that the former Member for Clacton—I am not sure whether he is still the Minister’s hon. Friend—wrote on his blog earlier this week that public sector net debt has increased and is now £400 billion higher than the debt that the Labour Government left. He said that this Government have now put on more debt in five years than the Labour Government did in 13 years.
We all know that money is tight, but there are three things which the Government could turn their mind to quickly. The first thing must be integration with the Department for Work and Pensions, which means bringing together ESOL budgets in a completely new way. As my hon. Friend the Member for Birmingham, Perry Barr (Mr Mahmood) made clear, the Skills Funding Agency has taken away well over £1 million in ESOL provision that the DWP has had to put back in. It is heartbreaking for us to meet mums who are desperate to go back to work but do not have a strong enough grasp of English. They want to do well by their families, but they cannot. Proposals from Lord Heseltine and Lord Adonis radically to devolve skills funding are on the table and would allow us to put together the Work programme and skills budgets in a new way, so that we can skill people up to do the jobs that are available. I represent a constituency a mile away from the expanding Jaguar Land Rover plant in Castle Bromwich, but it has the highest youth unemployment in the country, which is prima facie evidence that the skills system is not working. We should listen to Lord Heseltine and Lord Adonis and think radically about how to devolve skills funding so that the DWP and skills budgets can be joined up in a new way.
The second point, as made eloquently in a forensic speech by my hon. Friend the Member for North West Durham (Pat Glass), and underlined by my hon. Friend the Member for Birmingham, Perry Barr, is that we must raise our game on skills and radically increase the number of higher apprenticeships. If we want to tilt our economy decisively towards those high-value engineering and science-based industries that are the key to the bigger-knowledge economy, we must increase the number of higher apprenticeships. Just 2% of apprentices go on to study higher level skills, which is appalling and needs to increase. Across the country, however, there is a profound lack of clarity about how the Government’s new proposed money will actually be distributed. That lack of clarity is unacceptable and the Minister will want to work that out quickly.
There is wide support to increase employer ownership of skills as one way of increasing the number of apprenticeships and higher level apprenticeships, but in an economy in which small and medium-sized enterprises are creating jobs three or four times faster than big business, the new funding system must work for SMEs. All over Britain, SMEs are saying that putting in all the money through the tax system will not work. That decision is in the Minister’s red box and I hope he will be able to tell us whether he is planning to go wholesale and introduce the plan in the autumn, as originally proposed, or whether to listen to the voices of 4 million or 5 million small businesses across the country that are asking him to think again.
The third thing that the Minister was left with by his predecessors, as underlined by my hon. Friends the Members for Scunthorpe (Nic Dakin) and for Stretford and Urmston (Kate Green), is the strategic problem with adult skills. Big cuts to further education, a very marketised higher education system and a huge explosion in the private sector college system have unleashed a series of competitive pressures in the further and higher education system. As a result, system collaboration is incredibly difficult. That problem is compounded by a broken bridge between funding for 18-year-olds and funding for those over the age of 24.
My hon. Friend the Member for Scunthorpe underlined the appalling impact of big cuts in further education funding for those at 18, but between the ages of 18 and 24 there is only 50% funding towards tuition costs and 0% access to the Student Loans Company. That means a broken bridge between the funding system that works up to the age of 18 and the one that then kicks in at the age of 24. There is no clear escalator through the skills system. Some funding for level 4 and above is offered by the Skills Funding Agency, but only for a higher apprenticeship. The problem is that, out of 200 apprenticeship frameworks, only 14 go up to level 4. Furthermore, people need a degree to understand the system. Why is that a problem? It is a problem because, as the OECD cited in its seminal report on skills in England back in 2013:
“the weak articulation between level 4 and 6 programmes and university bachelor programmes is a serious problem”.
There is a broken bridge, and a radical rethink is needed.
On behalf of the Labour party, the shadow Secretary of State for Education, my hon. Friend the Member for Stoke-on-Trent Central (Tristram Hunt), and I have set out a different approach—a “gold standard” route for vocational education, so that we begin to reform the school system, the further education system and the university system. We believe that everyone should be doing some vocational education from the age of 14. We believe that there should be a new gold-standard technical baccalaureate with compulsory English and maths up to the age of 18. We believe that the priority for expanding the higher education system should be the creation of technical degrees, so that people can study while they are still working. We floated the idea over the summer that a new institutional partnership between further education colleges and universities is needed, along the lines of the American community college programme.
Those new technical universities should have partnerships with universities with world-class engineering and science facilities, perhaps as part of new university enterprise zones up and down the country. That could be one of the ways in which we make the decisive shift that was explained by my hon. Friend the Member for North West Durham. We have got to rebalance our economy, and rebalancing our skills system has got to be part of it.
We have had an impassioned debate. Particularly welcome was the emphasis of my hon. Friends the Members for Luton North (Kelvin Hopkins) and for Sheffield Central (Paul Blomfield) not only on the sheer economic importance of further and higher education and of adult learning, but on the life-changing power of such investment. This country faces a productivity crisis and a poverty crisis, so we must leave the Chamber hearing the note sounded by my hon. Friend the Member for Hackney South and Shoreditch sounded—she said that there is poverty, but no poverty of ambition—as well as leaving with a determination to do something about it.
The Minister is a thinking member of his party and has a track record of thinking through complicated issues. He is someone with a conscience and he cares profoundly about increasing social mobility in this country. He is blessed by simply having been appointed, with that great mind of his, to one of the most fantastic jobs in the Government. We look forward to his brief and his work with a heightened sense of anticipation. We also look forward to what he has to say to us this afternoon.
The Minister for Skills, Enterprise and Equalities (Nick Boles)
It is a pleasure to serve under your chairmanship, Mr Robertson. It is also a pleasure, and an unfamiliar one, for me to be in a Westminster Hall debate—although we are not actually in Westminster Hall—in which I am not facing a crowd of angry Back Benchers from my own party; they are much less gentle in their attacks than Labour party Members have proved to be today. That was my experience as planning Minister, and an uncomfortable one it often was. It is reassuring to find myself in the traditional position of mainly facing criticism, as well as inquiry and constructive suggestion, from the Opposition. I am, however, also grateful to my hon. Friend the Member for Nuneaton (Mr Jones) for his contribution.
We have covered a lot of ground today. I want to be clear that almost everyone who has contributed to the debate knows more about the area than I do. I am still myself an adult learner, and a rather slow one at that, so if I do not have the detailed technical grasp to answer all the questions, I apologise. I am happy to have further discussion and correspondence with any Members who feel that I have not adequately answered their questions.
While setting the context, I am afraid—I hope that the shadow Minister, the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), will forgive me—that I must remind the House of a few awkward truths. Clearly, there has of course been a substantial cut in the adult skills budget; no one is denying that or pretending otherwise. As the author of a notorious note, which I will forbear to repeat the few words of, no one knows better than the right hon. Gentleman the financial environment that we inherited when we came into government. I also suspect that, had his party stayed in government after the election, no one would have been more ferocious than him in making the case for protecting that part of the education system that every child must go through, and which is critical to every education—whether academic, technical, vocational or professional. That is, of course, the schools system. That is what the Government have done. It has been difficult and painful and it has involved sacrifices in other areas, one of which has been in the adult skills budget.
The second awkward truth that we all need to acknowledge is that much of the spending in the adult skills budget—
Pat Glass
I want to remind the Minister of another awkward truth: the £1 billion overspend on the academies and free schools budget. The Government had priorities and they made decisions—they chose to put money into new and experimental areas, while making cuts that affected the most vulnerable children in our society.
Nick Boles
Let us put to bed the ridiculous shibboleth that somehow free schools are an experiment. Free schools are, basically, new academies; they are exactly the same as academies. Tell the children at free schools that their schools are somehow different or experimental and that the money spent on them, that £1 billion, is not spent on the education of the children of Britain. I think that they would give the hon. Lady the flea in her ear that she so richly deserves—
Nick Boles
The other awkward truth is that a lot of the spending from the adult skills budget was, frankly, on a series of qualifications that were a fraud on those who were duped into taking them. A whole bunch of the qualifications that were funded did not prepare people for work, enrich their CVs, enable them to command better jobs or add to the productivity that, as the right hon. Member for Birmingham, Hodge Hill so rightly said, everyone needs. It was therefore right to do what we did, which was to focus the system of qualifications down and to ensure that the funding goes to produce qualifications that will actually help people.
Mr Byrne
May I draw the Minister back to the future, rather than to the past? In the autumn statement last year, the Chancellor talked about one of the most important adult qualifications available in this country, which is degree places. He said that degree places would be uncapped and he set out, conservatively, the cost of about £1.9 billion, which was to be financed by selling off student loan debt.
On 20 July the Minister’s boss, the Secretary of State, said that he and the Deputy Prime Minister had decided that the sale of student loan debt would not now go ahead. Will the Minister confirm whether the expansion will still go ahead and, if so, where on earth the money will come from?
Nick Boles
Needless to say, not being the Minister responsible for higher education and certainly not being my boss, the Secretary of State or indeed the Prime Minister, I can do no such thing. We are talking about the adult skills budget and that is what I will return to.
The right hon. Gentleman asked me to focus on the future and I am happy to do that. The position we are in now is not as bleak as some hon. Members have tried to paint it. Yes, we have a dire skills shortage in this country, but I remind hon. Members that all the young people who are not currently equipped to get the jobs that have been created and that hon. Members listed were educated under a Labour Government. All of them went through primary and secondary school under that Labour Government, so if they have left the school system ill-prepared for the jobs of the modern economy, let us share the responsibility for that lack and together work out how to fill the gap.
There is more agreement about the future than there will ever be about the past, and I will come on to the key elements of that. Specific questions were raised, however, and I want to make sure that I address them before I run out of time. The hon. Member for Stretford and Urmston (Kate Green) made an interesting speech, in which she specifically challenged me to take up with the DWP the question—[Interruption.] Was it the hon. Member for Hackney South and Shoreditch (Meg Hillier)? I am sorry, I cannot remember. I was asked to take up the issue of jobcentres being inflexible about courses and requiring people to leave them. I am aware of the issue broadly but not in detail, and I will be happy to take it up.
The hon. Member for Birmingham, Perry Barr (Mr Mahmood), who is no longer in his place, invited me to visit an apprenticeship centre run by the EEF. Will somebody tell him afterwards that I will be happy to do so if I can, as it sounds like an interesting venture?
I am happy to take up any issues that individual hon. Members have with particular colleges and funding situations. The hon. Member for Sheffield Central (Paul Blomfield), for example, raised some issues about a specific college, and I would be happy to take those up.
Now I come to the actual question from the hon. Member for Stretford and Urmston. She asked about funding of HNDs and HNCs. If I may, I will get back to her with more specific detail on that. She also asked specifically about extending the internship model to older adults. That is an interesting idea, but not one in which I am sufficiently well versed to give a response now. I will be happy to meet her to discuss the issue and see whether we can do more.
Now, to the future, and how we improve the productivity of people in this country so that they can secure the fantastic jobs being created—I hope we will all acknowledge this—in record numbers in this economy, to an extent that no other European country seems to be able to match at the moment. For the Government—we make no apologies for this—the most important policy to ensure that improvement is the policy on apprenticeships. That is why, even with a declining skills budget, we have ensured that the funding of apprenticeships is maintained and have been able to secure a dramatic increase in the number of people taking apprenticeships.
That is not at all to say that we are in any way satisfied with the position we are in. We also recognise, for instance, the very low number of higher apprenticeships as a proportion of the total and want to expand those, but without in any sense diminishing the lower level apprenticeships. Those are often the ones that young people who leave school without qualifications are going to be able to access first; we are not necessarily saying, either, that they should not move on to a higher apprenticeship in due course.
Mr Byrne
In that case, the Minister will want the maximum value for money from the programme that he is responsible for. A total of £340 million has been earmarked for the employer ownership pilot for apprenticeships, but the latest figures show that only 20,000 new apprenticeships have been provided. That is a unit cost of about £17,000. Will he explain whether he thinks that is value for money and what he is doing to drive up numbers for that programme?
Nick Boles
The right hon. Gentleman is too good a numbers man not to recognise the trick he has just played, which is to take the total budget as his denominator and use only the number of starts achieved so far as the figure that he is declaring it against. If he looked at the amount of money that has been drawn down from the pilot, he would see that his denominator is a very much smaller figure and that dividing that three-hundred-and-whatever million by 20,000 does not present an entirely accurate picture.
Meg Hillier
On that point, £340 million has been allocated and has not been drawn down at the right rate. What is going wrong, what is the Minister doing to check on what is happening and how on earth is the situation being monitored to make sure that it is not just backfilling what employers would do anyway and giving money to businesses without them adding more to adult skills education?
Nick Boles
What this Government do not do—we do not believe in it—is just push money out of the door. That is what the previous Government did, which is why we inherited a deficit on the scale that we did. We believe in inviting people to come forward with bids and come up with quite experimental ideas—the scheme is unashamedly a pilot—and then checking whether those ideas are high quality and are adding value, and whether the money is going to be put to good use. If we do not end up spending all of the money mentioned, I will be the first to say that we did not do so because we did not have bids that were good enough and were going to deliver enough impact. That is the responsible way to deal with taxpayers’ money and money borrowed from future taxpayers, not the approach of the previous Government.
To return—it seems rather optimistic now—to areas where we perhaps agree, we need to have more higher apprenticeships. We also agree that although the increase in the number of adults doing apprenticeships is welcome, we should not allow that to be at the cost of 16 to 18-year-olds doing them. We therefore need to ensure that the offer is there and stands for everybody.
The hon. Member for Scunthorpe (Nic Dakin) and a number of others asked me about the changes in the funding of apprenticeships under the new trailblazer standards. All I can say at this stage is that, first, I am looking at the matter extremely closely, and, secondly, before coming anywhere near politics—before coming into the policy world, let alone to Parliament—I spent 10 years running a business that employed 150 people in the manufacture of paint brushes and rollers. I have lived and breathed—and wept—the experience of running a small business. I am not going to be a Minister who puts burdens on small or medium-sized enterprises that persuade them not to do what we want them to—provide more high-quality, long-term, demanding apprenticeships that improve the skills of the people of Britain.
There were also a lot of questions about adult learning and its funding. It is clear that there have been some very difficult decisions in that area, which have caused difficulties for some institutions and further education colleges, and, as we heard from the hon. Member for Sheffield Central, for some of the charities and social enterprises that work with FE colleges. Those decisions have also perhaps interrupted the availability of some provision, as the hon. Member for Luton North (Kelvin Hopkins) so eloquently described. We have had to make sacrifices, and it may be that some are never undone because of the fiscal situation we face as a country and the priorities we have to put in place. But we are going to look at the experience of advanced learner loans and then ask ourselves a series of tough questions about how much further it is right to go to align what is available for adult learners who are not going into universities with what is available for those who do.
We have had one little reassuring set of data. Wild and gloomy predictions were made about the effect of fees and loans on the participation of people from a range of different backgrounds, including poorer ones, in universities. Those predictions have not come about. Similarly, we have no evidence on advanced learner loans of any dramatic effect on or change in the profile of those who participate in adult learning. We will be looking at making sure the opportunities are available. They may need to be funded differently from how they were in the past, but it is right to see whether we can make sure they are available for all in the future. [Interruption.]