Skills and Post-16 Education Bill [HL]

Debate between Lord Layard and Baroness Garden of Frognal

Report stage
Thursday 21st October 2021 Lords Chamber

[Baroness Garden of Frognal (LD)]

My Lords, I have added my name to Amendment 60 on the lifetime guarantee tabled by the noble Lord, Lord Watson, but I shall first say a few words about Amendment 50, which has been so eloquently introduced by the noble and learned Lord, Lord Clarke. It was good to go down memory lane with NVQs and YTS; I remember them well. I am concerned about subsection (1) in the proposed new clause, which requires funding for an approved course

“if he or she has not already studied at that level.”

We have put quite a lot of effort into trying to get funding for people to study at levels equal to or lower than qualifications they already have, if that is going to enable them to get into a new job. To restrict this to people who do not have a level 3 qualification might well be problematic. But oh, how much I agree with him about apprenticeships. In my mind, an apprentice is somebody starting out in work, not a middle manager doing an MBA. Having something to try to ensure that apprenticeship levy funding goes to young people is essential if that system is to work properly.

On Amendment 60, it is important that the lifetime skills guarantee is on a statutory footing if it is to have any impact at all. Both these amendments refer to courses up to level 3. It is important that we do not overlook qualifications at levels 1 and 2, because often they are the gateway to learning for people who have been put off education at an early age, as I have said before. Level 1 learners can be people who are encouraged for the first time to find learning accessible, enjoyable and fulfilling, when at school academic learning and GCSEs had been nothing but off-putting and a source of failure. That is something we need to be sure to support. Once such people discover that a national qualification is within their grasp and their ability, they will often find the confidence to continue to upskill and to gain employment in areas that they previously assumed were unobtainable. If the Government are serious about levelling up, they must start at the lowest levels. Amendment 60 would be a definite boost to that agenda, and I hope the Minister will look on it favourably.

[Lord Layard (Lab)]

I support Amendment 50, which could transform the lives of hundreds of thousands of our young people. Given the time, I shall make just four points. The problem is much bigger than most people, maybe myself included, have realised. In 2019-20, the proportion of all 18 year-olds who were in no form of education or work-based training was 30%. That 30% of the 50% not going to university are getting no education beyond the age of 17. This is completely extraordinary and shocking. What is the reason? It is that there simply are not enough places for these people to study and acquire skills compared with people going down the academic route.

The lack of places is almost entirely due to the completely different way in which those places are funded. As the noble and learned Lord, Lord Clarke, said, when young people go down the academic route, the funding automatically follows the student year by year, but for the other 50% the budget is simply set by the Treasury. It is capped in total and college by college. The current funding for 2021-22, including recent additions, is still less than half what it was in nominal terms in 2010. This is extraordinary and shows the failure of the system that this sort of thing can happen. It is difficult to think of any case of greater discrimination in any other aspect of our public life. I cannot think of any more extreme class-based discrimination than in that area.

What is the remedy? It is clear that the only approach which is fair to other 50% and which will adequately address the problem is to fund the other 50% the same way as the privileged 50% who go down the academic route—to make the money automatically follow these students. The proposal is that every student up to level 3 exercising the lifetime skills guarantee and taking an approved course—not just anything—should be automatically funded according to a national tariff. As the noble and learned Lord, Lord Clarke, explained, that is the essential part of the first half of this amendment.

The second half relates to apprenticeships. When I was very young, I worked for the Robbins committee. It established the principle that there should be enough places for anybody who qualified for a place and who wanted to exercise access to it. That has always applied to higher education, ever since the Robbins report. It has never applied to the other 50%; they just have not been thought of in that way at all. That really has to change.

As the noble and learned Lord, Lord Clarke, said, we now have a severe lack of apprenticeships for young people. There is huge, well-documented excess demand but supply is falling. The system is completely unresponsive and far too much of the apprenticeship money is being diverted to the over-25s. I will give two reasons why I think that is wrong. First, what is the key duty of any system of education and training? The first key duty is of course to get everybody off to a proper start. Good initial training is the central feature of any just, efficient system.

There is an extra, economic fact about the use of resources which I think is very relevant. The Department for Education’s own figures show that the benefit-cost ratio is much higher—in fact, double—for apprenticeships for the under-25s compared with those for the over-25s. For the sake of justice and efficiency, we have to redirect this money to an important degree back to the under-25s.

I would have thought this was a central proposal for any levelling-up agenda. We have a problem which is a major cause, almost the main cause, of our low national productivity per head. It is also a major cause of the spread of low incomes among the lower part of the workforce. If we are looking for items for a levelling-up agenda, surely this should be near the top.

I hope that as many noble Lords as possible will support this amendment and that the Government will also support it. If the Government find that they cannot support this proposal, I worry about the whole future of the levelling-up agenda.

Skills and Post-16 Education Bill [HL]

Debate between Lord Layard and Baroness Garden of Frognal

Committee stage
Monday 19th July 2021 Lords Chamber

[Lord Layard (Lab)]

My Lords, I rise to support Amendment 76. As the noble and learned Lord, Lord Clarke, has argued so powerfully, we are, as a nation, very good at producing graduates and pretty bad at producing skills for the other 50%.

I start with a quite extraordinary statistic: if you ask what proportion of all the 18 year-olds in our country are not in any form of education or work-based learning, the answer is 30%. That is an absolutely incredible situation, and it really is time that we addressed that problem. It is a problem for our national productivity and, of course, it is a big problem for the subsequent incomes of those people. If we are looking for priorities, which is what this is all about, the central aim of post-school policy development must now be to deal with that problem and get more of our young people up to level 3—or at least level 2.

The lifetime skills guarantee is of course a very welcome proposal towards that end—giving a first level 2 or 3 to everyone, free of charge, irrespective of age—but it should be put into law. If the Government are serious about it, they should have no reservations on that point. That is covered in the first bit of this amendment. However, the more substantial issue, to which my noble friend Lord Adonis referred, is how to deliver that guarantee. Unless the places are there, there is no point in a person feeling that they have the right to free education if, when they look around, they see nothing that they like. They would not, in effect, have a right—they have that right only if the money automatically follows their choice.

What we are saying to the Government—I hope that the Minister will reflect on this—is that there is actually no chance that the guarantee can be delivered through the existing system of contracting with the colleges. In that system, each college has a capped budget, the size of which it negotiates annually with the Education and Skills Funding Agency. That agency, in turn, has a capped total budget, which, currently—even taking into account recent increases—is half of what it was in 2010. So that is what our present funding system enables us to do for the other 50%. We can do whatever we will, but, unless we do something about that funding system, we will not be able to deliver the right to a lifetime skills guarantee.

The contrast between what faces those people and what faces people going down the academic route is extreme because if you go to university or sixth form, the money of course follows you automatically. That is why our academic education is among the best in the world. It is difficult to think of anything more completely unjust in our social arrangements in this country than the comparative treatment of people going down the academic route and of those wanting to go into further education.

We have to dynamise the system of further education in the same way that we have dynamised universities: by enabling any institution that thinks that it can attract the people who are entitled to put the course on, knowing that the money will automatically follow. It is very nice that we have the “lifetime skills guarantee” expression because we can say that any student who is accepted by a college should automatically be funded for exercising their guarantee. What is a guarantee if the money does not come with it? It should be a guarantee of free education, funded in an automatic fashion. We want our colleges to lead in transforming the skills of our non-graduates, which, as I say, is more important than any problem relating to graduates. Let us take the colleges off the leash and pay them for any eligible student who they can attract—that is the only way that we can implement the lifetime skills guarantee. I hope that the Minister can reflect on how that guarantee could be implemented in any other way.

I turn finally to apprenticeships. Again, as many noble Lords have already said, we have to be clear about what the really big problems are, as opposed to other things that would also be desirable but are not of the highest priority. As I said at the beginning, the biggest problem is that so many young people are entering adult life without any proper training—we absolutely have to address that. The key moment occurs before people are 25; we must do better for people at that stage. To put that in context: 30% of people have had no form of work-based training or education. This is a problem of opportunity and of places. We are still trying to get the figures, but we know that there is huge excess demand from young people for places on apprenticeships. There are people who want apprenticeships and cannot get them. Finding a mechanism to generate those places is absolutely critical. At the Youth Unemployment Committee, to which the noble Lord, Lord Baker, referred, we constantly have evidence of this huge excess demand. We are trying to get the numbers; we do not have them yet, but everyone says that that demand is there.

We can only solve that problem if we use the apprenticeship levy to generate those places. One could imagine all kinds of subtle ways to incentivise employers to spend the apprenticeship money on younger people, but I do not think that they would work. That is why this very simple rule—two-thirds of apprenticeship funding going to people under the age of 25—is the most direct approach. Of course, it has to be for people taking apprenticeships at levels 2 or 3 because, if we said “under 25” but not the second part, we would see that they would want to fund degree and graduate apprenticeships. They would want to recruit bright young graduates and not bother about the other half of the population.

I stress the need to focus not just on the places but on the money for the places, because places for younger people are cheaper than those for the older people. As the amendment says, two-thirds of the money should go to people starting at levels 2 or 3 when aged under 25. Of course, I am very keen on degree and graduate apprenticeships but, if employers want to do those, they should come from the other third of the money or their own resources.

This whole amendment is about how to generate the places for young people to get the proper start in life that we want them to have and, thereby, earn a decent wage and contribute to national productivity. Such things do not happen just by saying, “You’ll have a guarantee”; you have to put it into law, as the other amendment also says, and then have proper ways of funding both the guarantee and the apprenticeship.

It is true that the Government now have the right aspirations. We are in a new situation with huge opportunity, and the skills White Paper absolutely heads in the right direction, but this amendment is, in a sense, a test of how serious the Government are about actually realising their admirable aspirations. I hope that the Minister will find the amendment helpful.

[Baroness Garden of Frognal (LD)]

My Lords, I added my name to Amendment 80 from the noble Lord, Lord Watson, but I also strongly support Amendment 76 from the noble and learned Lord, Lord Clarke, and the noble Lords, Lord Layard and Lord Rooker. It is a great pleasure to follow the noble Lord, Lord Layard; we are among some of the giants of the education world here.

If the Government are serious about wishing to reskill and upskill the nation, lifelong learning is an absolutely essential component. I would say to the noble Lord, Lord Aberdare, that “lifelong” is the word we are more used to—but I agree with him that we should sort out before we go much further whether it is lifelong or lifetime. As we shall discuss later, adults are much less likely to wish to take on repayable loans, so the right to free education up to level 3 is a very positive measure.