Lord Storey (LD)
My Lords, we on these Benches welcome the Statement. We share many of the concerns that the noble Baroness, Lady Barran, raised, and she quite skilfully teased those out with the questions she asked. Looking at the Statement, my immediate thought is that there is a lot of rhetoric in it, but there needs to be less rhetoric and more detail about some of the proposals. The biggest issue we face, which is not addressed, is the cultural shift in this country. Parents regard it as a successful education, quite honestly, and I have said this before, if the child or young person gets the required number of GCSEs, goes into the sixth form and goes to university. Schools lap up the number of students who go into the sixth form because they get extra funding for it, yet we know that half the pupils in our secondary schools are not academic, and we have this academic curriculum.
The other thing that surprises me in the Statement, which I think is crucial, is that young people need guidance. They need advice. They need help. They need support. I am surprised that there is no mention of careers education or careers guidance in the Statement —at this point, I declare an interest as a patron of Career Connect. It rightly says that
“our young people risk being left behind.”
That is absolutely right, because currently we have about one million NEETs in this country—not in education, employment or training. It talks about
“local businesses becoming more productive … and bustle returning to the high street”,
which begs the question of how we are going to do that. That is not just by quality training; there are number of other issues. Of course, the hike in national insurance did not help businesses, to be honest, and it certainly did not help high streets either.
The Statement talks about
“a muddle of confusing pathways”,
yet in some respects makes the muddle even more confusing, replacing BTECs with V-levels and cutting funding for the international baccalaureate programme in state schools. We welcome V-levels bringing flexibility, but we would rather see the phasing out of BTECs by 2027, both running in parallel during the transition so that outcomes can be compared. We know that BTECs work, because 200,000 students took them last year and 99% of universities accept them. One in five workers hold them. We need the Government to be more supportive here and look at funding streams. Why can sixth forms claim VAT, yet further education colleges cannot, for example? We support V-levels, but only if the transition from BTECs is based on evidence and if sufficient funding is provided to truly deliver a world-class vocational education.
Briefly, I am pleased about the section on universities. On the last Statement, the Minister gave us an assurance that the Government would face up to the funding crisis in universities, and they have been true to their word, but it is a bit disappointing that more money could have been available for universities had they not slapped on the levy for overseas students. That could have been an income stream that benefited the university sector.
I turn to the international baccalaureate. It sets the global benchmark for education. It is trusted by universities, employers and educators around the world as a mark of academic excellence, and thousands of British families choose to send their children to schools offering the IB diploma. What assessment has the Minister made of the impact of this cut to students’ ability to study under an internationally recognised programme?
We welcome the Government’s ambition to create a joined-up, strategic approach to education. However, the glaring omission of lifelong learning cannot be ignored. Learning does not end at 21. What steps are the Government taking to provide pathways for essential professions and deal with shortages in social work, nursing and engineering? It is important to all of us—we all have a real stake in this, the present Government and the previous Government—that we get this right and that it works. I hope that the mantra of two decades ago, “education, education, education”, is replaced by “skills, skills, skills”.
The Minister of State, Department for Education (Baroness Smith of Malvern) (Lab)
My Lords, in the relatively short time left for me before we get on to other questions, I will endeavour to respond to as many of the points raised as possible. Just to reiterate, this White Paper outlines the Government’s plans to deliver a joined-up skills system that targets skills gaps and leaves no place or person behind, a specialist and prestigious FE sector with high-quality study pathways into work and a world-leading higher education sector that drives innovation and growth and delivers high quality and good value for students. It is the blueprint for delivering the Prime Minister’s bold new target for two-thirds of young people to participate in higher-level learning—academic, technical or apprenticeships—by age 25.
On the first point made by the noble Baroness, Lady Barran, about higher technical qualifications, we will work with the Office for Students to develop new HTQ awarding powers for providers and we are reforming the process for designating higher technical qualifications to make them meet a wider range of employer and local needs. I am glad that she recognised the development of technical excellence colleges as an important way of raising standards in further education. We are outlining plans for a further 19, following the 10 construction techs, in a range of other industrial strategy areas, and techs, of course, will enable us to raise standards by developing advanced equipment, specialised staff and new curricula, all alongside industry. We will learn and build on the model of institutes of technology, although I note that they have not been as successful in developing levels 4 and 5 as I suspect noble Lords opposite wanted them to be.
On the development of V-levels, this Government have taken the decision to maintain that important vocational route for young people—a route that would have disappeared under the previous Government’s plans. In doing that, we will build on what works in current vocational qualifications but we will also make sure that these new qualifications are linked to what employers need to see in those areas, guided by national standards.
On defunding, as we said last year when we carried out the qualifications review, we believe that where there are large courses in the same area as T-levels, students will gain more by following a T-level course. But we are going back from the defunding proposals of the previous Government, even some of those in the qualifications review last year, and we will maintain funding for all large qualifications in non-T-level routes, and for medium-sized and small qualifications in T-level routes, up to the point at which V-levels are available, ensuring that the transition is as smooth as possible. In developing V-levels, we will engage with colleges, employers and, of course, awarding bodies.
On the English and maths qualification, it remains incredibly important that young people achieve that grade 4 in English and maths, and that is why we have both increased funding and been clear in our guidance that that should continue to happen in further education colleges. But there is no point in somebody keeping on taking an examination when they have not yet been able to gain the foundation necessary to succeed in that. That is why we will introduce new opportunities through level 1 qualifications for those foundations to be built on, so as to achieve success for young people rather than failure. We will invest in the further education workforce, as we already have done, and we will provide £800 million extra next year for the further education sector.
Yes, we will consider areas where we can expand T-levels.
I will probably get the opportunity to say more about higher education quality later, but we are clear that where there is bad value for public money, we will, alongside the OfS, ensure that it goes out of the system.
There is mention, by the way, of level 2 and 3 apprenticeships, not least in the £1 billion of investment that this Government have put into sector skills packages.
The noble Lord, Lord Storey, suggested that the Statement was rhetorical. Yes, elements of it were, but I am sure that he has also looked at the considerable amount of detail in the White Paper, and I am sure we will have many more opportunities to get into more detail on that.
Fundamentally, as the noble Lord says, what the White Paper does is to improve the status of our technical and vocational qualification routes, for young people and for older people, to ensure that we bring about a fundamental renewal of the skills system as part of our national renewal. This White Paper is a turning point, and I look forward to working through how we deliver this fundamental change, how we measure it and how this therefore leads to an improved skills system, improved opportunities for people throughout their lives, and improved growth for our economy.
Baroness Morris of Yardley (Lab)
My Lords, I too welcome this White Paper. I think it is a turning point. It is a document of ambition and a very serious document. If it is implemented, it is a turning point—there will be no going back on some key issues. But the devil really is in the detail and, although it is an ambitious document, I just want to press the Minister on the BTECs and the V-level qualifications because that is the biggest change. If they do not work, this will not be a successful White Paper.
Did I hear the Minister say that there will be no gap between the defunding of the successful BTECs and the introduction of the V-levels, even if that is later than anticipated in the White Paper, which may very well be the case? A query I have in my mind is: if the content of the BTEC is successful now with both employers and learners, will that content be reclassified as a V-level or will it cease to exist?
Baroness Smith of Malvern (Lab)
To reiterate, what we have said is that where there is a T-level in place, we will, as we said we would in the qualifications review that we did last year, defund a large qualification that sits alongside it because all the evidence is that students get through T-levels—and the placements, for example, that go alongside T-levels—a better chance of progression. But, yes, in all other areas we will maintain existing qualifications up to the point that a V-level is in place to replace them. We will want V-levels to build on what is good about current vocational qualifications, including BTECs, and that is why we will engage, through our advisory group, with college principals, the awarding organisations and others. Of course, we have issued a consultation document on the development of V-levels and the other important reforms in post-16 qualifications, which I encourage not just noble Lords but anybody else who is interested in this to contribute to.
The Earl of Clancarty (CB)
My Lords, this is certainly an important document. The first thing I noticed about it, though, was that it is being fronted by DSIT but not DCMS, which does not seem to be involved at all—when the creative industries are such an important aspect of the industrial strategy, and in particular the many skill sets that will be needed to drive these industries. Those skills will have their own pathways. So I ask the Minister: what thought has been given to vocational pathways for those who wish to work in the creative industries?
Baroness Smith of Malvern (Lab)
There will be opportunities through V-levels for those interested in vocational routes into the creative industries. There will be opportunities through some of the sector skills packages—not least, for example, in the area of digital—to support the creative industries. There is, of course, a sector skills plan as part of the creative industries element of the Government’s industrial strategy.
Lord Willetts (Con)
My Lords, I particularly welcome the increase in fees for students, as that sets the resources available for the education of students without affecting the monthly repayments that graduates subsequently make. However, the international student levy will take away quite a bit of that resource, so does the Minister agree that the real resource available for educating students overall will continue to fall? Does she accept that that cannot carry on indefinitely?
I also welcome the recognition in the White Paper that there is no viable alternative to the fees and loans system that we have now had for over 20 years. But is the Minister concerned that there are still misunderstandings and misplaced anxieties that it is somehow a fixed amount of debt like a credit card debt or stops you getting a mortgage? If anything, those concerns appear to be increasing. Will the DfE energetically commit to explaining to young people the realities of how the system works?
Baroness Smith of Malvern (Lab)
On the noble Lord’s first point, no, I do not accept that an index-linked increase in tuition fees—a certainty of funding that no other public or private sector organisations, or very few, could have committed to them—will leave universities worse off. That is notwithstanding this Government’s decision that in order to reinstate the maintenance grants removed by the last Government we will use a levy on international students to reintroduce targeted maintenance grants for students. Of course, asking students to invest in their education is right, alongside government investment, but we need to make sure that that world-leading higher education system is open to all who can benefit from it and that we close the gap in access, which has persisted for too long.
Lord Addington (LD)
My Lords, the Government have stated, and the Minister has repeated, the concentration on English and maths. They have also talked about special educational needs and I once again declare my interests: I am president of the British Dyslexia Association—whose event in the Commons I am missing at the moment—and chairman of Microlink plc, which does assistive tech packages.
On special educational needs—dyscalculia, for example—I met somebody the other day whose brother had failed the maths component of an apprenticeship for the 15th time. Can we make sure that, when we look at the qualifications, if we are going to bring everybody into the skill set, everybody is allowed to pass, either by changing the qualification or allowing assistive technology to be used? This does not happen in universities, which can make their own rules, but for the higher education sector—levels up to five—it is essential that we have that guidance from the Government.
Baroness Smith of Malvern (Lab)
Quite often in further education, there is very good special educational needs provision, which we will learn from. We will also ensure, as part of our special educational needs reform, that further education is included as a part of that. However, the whole point about the reform in English and maths qualifications—particularly the introduction of a new qualification that will enable students to demonstrate and build on their foundations—is to support more young people to pass. The noble Lord will also know that we have changed the conditions for adult apprenticeships so that it is no longer necessary to get a separate English or maths qualification in order to get an adult apprenticeship.
Lord Knight of Weymouth (Lab)
My Lords, while I associate myself with the comments on the IB from the noble Lord, Lord Storey, I want to focus on the issue of NEETs. The White Paper seeks to address the growing problem of NEETs with pre-NEET targeted support in schools, the youth guarantee and short courses funded by the growth and skills levy, and the lifelong learning entitlement. Can the Minister tell us how these short courses will consolidate into the high-quality apprenticeships that this vulnerable group need if they are to prosper in the labour market?
Baroness Smith of Malvern (Lab)
I thank my noble friend for recognising the range of reform necessary to tackle this enormously worrying problem of young people who are neither learning nor earning. In order to prevent that in the first place, as he identifies, we will have higher expectations on schools to ensure suitable destinations for young people. We will look at the ways in which we can ensure that every young person has a place in a college and is auto-enrolled if necessary. We will then, through, for example, the Chancellor’s announcement of a backstop youth guarantee work placement for young people on universal credit who have been out of work for 18 months, make sure that people no longer start their working life without the work or training that can lead them to succeed.
When it comes to short courses, this is part of our reform of the apprenticeship levy into a much more flexible growth and skills levy, which, alongside short courses, also introduces foundation apprenticeships. These will be a very important way in which young people can enter the workforce and will have an important impact on NEETs as well.
Baroness in Waiting/Government Whip (Baroness Blake of Leeds) (Lab)
I ask noble Lords to keep their questions short. We have enormous interest in this subject and we want to get through as many questions as we can.
Lord Johnson of Marylebone (Con)
My Lords, I declare my interest as a visiting professor at King’s and chairman of FutureLearn. I welcome the Statement, particularly, like my noble friend Lord Willetts, the bold decision to index fees with inflation—it is absolutely the right thing to do after a decade of real-terms freezes. However, I regret the missed opportunity to fix some of the big problems with the lifelong learning entitlement and the decision to take away with the other hand what the Government have just given on the fees front. Can the Minister please confirm the scope of the proposed tax on international tuition fees? Does it include, for example, online provision and transnational education—that is, courses taken by students from British universities while they are studying in other countries? Given that the Government have acknowledged that they do not have a strong evidence base on elasticity of demand, would it not be a better idea to pause to rollout of this tax or, better still, shelve it altogether?
Baroness Smith of Malvern (Lab)
I explained to the noble Lord’s colleague the reason behind the international student levy. I do not think it is true to say that there is not an evidence base on the elasticity of demand for international students, but we will have more to say about the design of the international student levy at the point of the Budget.
Lord Freyberg (CB)
I welcome also the ambitious nature of the White Paper, but can the Minister respond to how the strategy will ensure that creative industries and crafts are seen as legitimate skill sectors on an equal footing with engineering, manufacturing and industrial bodies? Given that many creative and craft roles are bespoke, freelance or project-based, how does the strategy accommodate non-standard employment and income models in training and qualifications? How will successful craft and creative routes be measured and how will this compare with other sectors?
Baroness Smith of Malvern (Lab)
There are a lot of questions in the noble Lord’s question, most of which I will have to respond to in writing. I reassure him that, in the sorts of crafts he talked about, we maintain a considerable number of apprenticeship standards that can be used by employers to take on apprentices and continue those sorts of important crafts.
Baroness Alexander of Cleveden (Lab)
My Lords, I too welcome the Statement. I want to probe the issue of franchising in the higher education sector. I am delighted to see the Government take action, but, as the Minister will be aware, there is some anxiety that, by requiring only the largest providers to register, we may miss some of the bad actors in this area. Will the Government keep the case for universal basic registration of all providers under review?
Secondly, as the Minister is aware, there have been excess profits made. Can she assure us that the department will be monitoring these returns, to mitigate the profiteering with public money and tackle the inadequate teaching that there has been for some students involved in this sector? Finally, will she keep under review the risks of keeping the student loan book open to high-risk providers in this area?
Baroness Smith of Malvern (Lab)
My noble friend is right that, over recent years, the doubling of the effective subcontracting of university education through franchising has led to concerns around the quality for students and the value for money for the taxpayer. That is why we will take action to register providers of franchised provision and we will strengthen the ability of the Office for Students to tackle poor provision where it is found.
Lord Mohammed of Tinsley (LD)
I support the comments of my noble friend Lord Storey and the noble Lord, Lord Knight, on NEETs and funding for them. One of the issues about NEETs is the “not known” figure. We might know the young people who are not in employment, education or training, but often there is a cohort who are not known, and that is where investment in information, advice, guidance and youth work will be essential.
I have two questions for the Minister about lifelong learning. There is a glaring omission from the Statement, and that is post-21 apprenticeships. Lifelong learning does not end at 21, and I would like the Government to look again at the cuts being made to those apprenticeships in the health sector, et cetera. The noble Lord, Lord Storey, asked about the assessment of the cut to the international baccalaureate, and what impact that will have on transnational students, particularly those who want to study abroad as well.
Baroness Smith of Malvern (Lab)
First, there is an increase in the number of apprenticeships that have started under this Government. Secondly, on the issue of the international baccalaureate, colleges and schools will continue to receive funding to provide courses, including the international baccalaureate. What they will not receive is the additional top-up that they have for the international baccalaureate, because this Government have made the decision to focus that on maths and STEM subjects, where people take larger numbers of courses. Prioritising those areas is a legitimate decision. Where the IB is being taught, there will be transitional support as the top-up is removed.
Baroness Spielman (Con)
My Lords, the White Paper places heavy emphasis on modularity and credit transfer as mechanisms to improve post-16 education. Has the Minister taken full account of the evaluation of the previous attempt, the qualifications and credit framework, brought in in 2008 and scrapped in 2015, and all the lessons that this should have taught us about the risks and important requirements for such a system?
Baroness Smith of Malvern (Lab)
I think the noble Baroness was welcoming the development of a more modular approach, supported through the delivery of the lifelong learning entitlement. Of course, we will want to look carefully at previous experiences, but we have a big opportunity here to increase both the prevalence of students who are able to go through a pathway to level 4 and 5 courses and the willingness of higher education institutions to work with further education to promote the possibility of that happening. As I say, we will learn from previous experiences in doing that.
Baroness Caine of Kentish Town (Lab)
My Lords, alignment with the industrial strategy is vital, and I am really pleased to see that the White Paper is taking a national view of skills in target sectors. It is good news that sector skills packages with significant investment attached have been agreed for construction, TechFirst, engineering and defence.
As has been said, there are also shortages in the creative industries. I therefore press my noble friend the Minister: does she agree that the development and agreement of a sector skills plan and package for and with the creative industries—working with DfE, DCMS and DSIT—is a priority and needs to be developed at pace?
Baroness Smith of Malvern (Lab)
As my noble friend knows, there is a sector skills plan that goes alongside the creative industries’ inclusion in the industrial strategy. Of course, it is already the case that among the sector skills packages—for example, the digital package, with £187 million behind it—we will be developing important skills for the creative industry. As well as the sector skills plan, jobs plans will be developed in each of the areas, and I am sure my noble friend will maintain her pressure to make sure that this makes the difference to skills in the creative industries that I know she wants to see.
Baroness Bennett of Manor Castle (GP)
My Lords, on the reality of student debt, for the cohort that started to be liable for paying off debt in April 2025, the average debt was £53,000. In the government stats for students starting in 2024-25, it is expected that about 56% of full-time undergraduates will repay in full, which of course means that 44% of those students will spend 40 years paying off a loan they will never finish paying off. Can the Minister tell me, either now or in writing, what these increases in fees will do to those two figures?
Baroness Smith of Malvern (Lab)
The noble Baroness has identified the very different nature of student loan provision from an ordinary form of borrowing. What a student repays is dependent neither on the size of the debt nor on the interest rate; it is dependent on the student’s level of income once they are working. The noble Baroness can shake her head, but that is the reality of the way the system is designed. Therefore, there is both a student contribution and, in many ways, a taxpayer contribution to ensuring that there is no upfront cost to students going to university. The noble Lord makes an important point that we need to clarify the nature of the student loan system, in order that we do not discourage young people from going to university.
Lord Hampton (CB)
My Lords, I declare an interest as a working teacher. I very much welcome this wonderfully optimistic White Paper and its positively Churchillian language. At one point, it says that
“we are improving careers advice in schools … and introducing 2 weeks’ worth of work experience throughout a young person’s secondary education”.
The Gatsby Foundation’s Ghost of Provisions Past talks about the difficulty of securing meaningful work placements. When schools’ biggest complaint is that T-levels are incredibly difficult to teach because you cannot get meaningful work placements, how do the Government see this working?
Baroness Smith of Malvern (Lab)
One of the big advantages of T-levels is that students are able to gain a 45-day work placement alongside their studies. T-level students continuously tell me that this is what they find most satisfying about doing a T-level. Yes, there is a challenge to make sure that those are of a high quality, but that is why, through our T-level ambassadors and through a very good meeting I had just last week with employers, we are continuing to work to make sure that employers provide those placements. They are of benefit not only to the students but to the employers themselves, who often find the workers of the future in those placements.