Skills for Jobs White Paper

Lord Storey Excerpts

Tuesday 26th January 2021 Lords Chamber

[The Deputy Speaker (Lord Duncan of Springbank) (Con)]

We lost the last part of those remarks, but I will call the next speaker, the noble Lord, Lord Storey.

[Lord Storey (LD) [V]]

I very much welcome the Statement and the Skills for Jobs White Paper. As the noble Lord, Lord Bassam, said, we have seen further education become almost the Cinderella of the education service, and it is really welcome that at long last we are now realising its importance in terms of capital investment in plant and sites and revenue investment. However, on the latter, I ask the Minister to consider the point made by Sir Ian Diamond’s commission: that colleges need three-year grant settlements to give them room to develop and that one year is not sufficient.

As a country, we face a whole host of challenges to do with training and skills—not least the climate emergency, the effects of Brexit and changes in the world of work—and of course a demographic time bomb is ticking away, with demand outstripping the supply of young people entering the labour market. We have already seen this in sections of our economy—the construction industry, for example. It is a sobering thought that by 2030 the number of people aged 65 and above is projected to increase by 42%, while the number of those aged 14 to 64 is forecast to grow by only 3%. It is clear that we need to be nimble in how we respond to skills shortages and skills development, and not get caught up in structures.

The ambition to open funding and finance to everyone throughout their lives is welcome. Many earners face additional barriers to accessing education, so we need to ensure that finance is available to meet those demands. Why are these loans are not being introduced until 2025—and why loans, not grants? We know that adults are more averse to taking on debt. We should review the limits on accessing education and training while in receipt of universal credit, with the principle that individuals should not be penalised for engaging in education and training.

The careers service, careers advice, careers education and careers guidance should be of high quality and given face to face, not micromanaged from the top. The proposed careers hubs have to have the support and expertise that is much needed. Can the Government ensure that we look also at building the skills that are needed for the green economy? They have focused a lot of support on people who do not have level 3 qualifications, but what about those who have not completed level 2? Do the Government not accept that they, too, will need support and help?

Finally, I am attracted to the suggestion by the Association of Colleges that the Government should form a cross-departmental ministerial task force to oversee a new government 10-year strategy for education and skills to drive industrial strategy and other priorities, working with employers and other key stakeholders.

[The Parliamentary Under-Secretary of State, Department for Education and Department for International Trade (Baroness Berridge) (Con)]

My Lords, I thank the noble Lord, Lord Bassam, for welcoming this report. It is good at this time of crisis to have good news and to know that in the past year, £600 million has been invested in the FE sector and £1.5 billion of capital is committed over the next few years.

The noble Lord correctly highlights the fact that at the moment people need to retrain, and quickly. That is why we have acted very quickly on the national skills fund so that the level 3 entitlement, which enables every adult to get their first full level 3 qualification, is in place. We have also had the first round of boot camps, which enable people to do eight-week to 12-week training courses and give them a fast-track route to an interview. We need to be nimble, which is why those initiatives have been introduced as part of the national skills fund before consultation on the rest of it is complete.

That is also why the Government will introduce local skills improvement plans and, because of the need for nimbleness in retraining, why the lifelong loan entitlement will be for four years. People who already have an undergraduate degree may then want to do a level 4 or a level 5 higher technical qualification. That will be introduced in 2025.

On conservation, I can tell the noble Lord that 400 courses have been made available under the level 3 entitlement, and they are focused on skills that we believe will lead quickly to jobs. Conservation is included in the level 3 entitlement.

The noble Lord referred to various aspects of the Augar review. Many of its recommendations have already been delivered: the level 3 entitlement; the investment in the FE estate, as I have outlined; the capital investment in new places for 16 to 19 year-olds to meet demographic changes; and the lifelong loan entitlement. There will be a consultation on other aspects of the Augar review in the spring, including the minimum entry requirements for higher education, and a full and comprehensive response to coincide with the next comprehensive spending review. Augar is a dynamic piece of work that will help us respond to the current crisis.

With regard to colleges, there will also be consultation around the need, identified in the Augar review, to consider multiyear settlements for FE colleges. We recognise that one of the issues facing them is the year-on-year funding so we are looking to address that.

On higher education funding, we are ready to implement restructuring should any of the HE sector need it, and we are closely monitoring the finances of those autonomous institutions. On the noble Lord’s point about the teaching grant, or T-grant, the other main source of income for universities, that is being redirected to strategic subjects. Obviously, these currently include subjects in the area of healthcare, but also certain arts subjects that we believe are not getting adequate funding. Those subjects are crucial to the labour market but we do not believe that the additional weighting given to London is the best way to fund that, and it is not consistent with the Government’s wider aim of levelling up different areas of the country. However, universities are dynamic partners in many of the institutes of technology which focus on STEM subjects, 11 of which are now open. It is good to see them working with the FE colleges and local employers on that initiative. There were perhaps a couple of final points from the noble Lord, but unfortunately the connection was interrupted. I apologise for missing those.

The noble Lord, Lord Storey, raised the issue of the accountability and funding of the FE sector. As I have said, we are looking into Augar’s recommendations on that, and it is also part of the remit of the FE commissioner —that role will be looking at the sustainability of the FE estate across the country, which is a vital part of reskilling people.

On the matters around the construction industry that the noble Lord raised, we have introduced a T-level in that sector, one of the first for 16 to 19 year- olds. With regard to the noble Lord’s point about demographics, he divides the population into, I think, people under and over 64, but we now know that people are working longer and their careers may involve more than one sector. Hence our concern with flexibility: levels 4 and 5 are more modular, and access to those qualifications will help people to train, and retrain, as will the four-year loan entitlement.

The noble Lord specifically raised the issue of entitlement to benefits while learning. We are alert to this issue in relation to people claiming universal credit. People can take part in eight weeks of full-time learning and maintain their entitlement to benefit, and there is no restriction on part-time learning. For people who have particular vulnerabilities and are at risk of long-term unemployment, that period of training can be longer.

On funding support, particularly for 16 to 19 year-olds, there are residential bursary funds to enable students to access specialist provision that is not available within their normal travelling range. Such funds are distributed by the FE sector. We are therefore aware of the need of those on benefits to have flexibility with regard to training. Careers advice is of course also a vital part of this package: £100 million is being invested in the careers service, much of which is targeted at face-to-face provision. Enterprise advisers are being rolled out by the Careers and Enterprise Company, which helps schools.

The noble Lord mentioned the need for net zero carbon. The Skills and Productivity Board provides a national picture of our economy. Its advice is given to the Secretary of State in accordance with the industrial strategy, so we are linking them up. At the local level, however, it is important that the local skills improvement plans will be employer-led, respond to local economic need and involve the devolved authorities. We then have a strategic development fund to enable the colleges to design the content of the courses that local employers are asking for. The overall ambition is that by 2030, almost all technical qualifications will be based on the employer-led standards that have informed the apprenticeships and the T-levels, so that the level of qualifications is high.

Finally, the noble Lord mentioned level 2 qualifications. As noble Lords will probably be aware, there is a second -stage consultation on level 3 about what qualifications we need to continue funding that are not T-levels or A-levels. There is also a call for evidence on level 2. We are particularly aware of young people who are further away and may not have got qualifications during their 11 to 16 years education and how we can enable them to get level 2 or level 3 qualifications and get on the qualifications ladder. The country needs a higher level of technical skills and enhanced respect for that sector, because men and women who have level 4 or 5 qualifications earn, on average, more than those with a level 6 undergraduate degree. This change has been overdue for decades in this country: to give as much respect to technical qualifications as we do to academic ones.