Qualifications Reform Review

Lord Willetts Excerpts

Wednesday 18th December 2024 Lords Chamber

[Baroness Smith of Malvern (Lab)]

I thank my noble friend for those comments. I suspect that she—like me—has taught these qualifications. I introduced a general vocational qualification into a high school where I taught, so I very much take her point about the different teaching and learning styles from which students can benefit. I know she agrees that we must ensure that we do not lower the quality of qualifications for students who perhaps need different teaching and learning styles. We continue to review to ensure that qualifications are of a high standard.

From my experience of visiting colleges offering T-levels, I have to say that there are some very innovative approaches to the ways in which they are delivered. That is why there has been a steady growth in the number of young people undertaking T-levels. Of course, we have introduced three new areas this year, and there will be another new one next year.

I also take my noble friend’s point about extensive engagement. The process of the review involved consulting more than 250 individuals, including principals of FE and sixth form colleges, senior and curriculum leaders, teachers and subject specialists in FE, employer representative bodies, industry leaders, awarding organisations, mayoral combined authorities and other government departments. That is one reason why it has received broad support: it was, in essence, co-designed with those who will be responsible for delivering the qualifications process.

On the point about work experience, my noble friend is of course right that while industry placements are a key element of T-levels, they also play an important role both post and pre-16. That is where we need to ensure that placements maintain rigour, are of quality and enable employers to step forward to do that. That is what we have sought to achieve with the flexibilities we have introduced into T-levels.

We need to continue working with employers by providing reassurance and the flexibility necessary to enable them to offer a range of placements. That is one of the things we do with our T-level and apprenticeship ambassadors, who work with employers to encourage them to offer the sorts of placements that will be beneficial for students in whatever course they are taking—whether it is one of those placements or work experience. We will continue to do that.

[Lord Willetts (Con)]

My Lords, I welcome this Statement. T-levels are a very useful part of the qualifications landscape, but it was never realistic to think that T-levels and A-levels between them could somehow dominate all the options available for 16 to 18 year-olds. Many former Ministers on both sides of this House took that view—I see my noble friend Lord Johnson sitting beside me. Although they are not present, I would like to say that it was good to work with the noble Lords, Lord Blunkett, Lord Baker and Lord Adonis, in arguing for a pause. It is welcome that we have now secured a rather better future, at least for some time, for BTECs.

I am sure the Minister will be aware of the recent report from the independent Education Policy Institute, which said that

“T levels are currently unsuitable for many Level 3 learners”.


That message from independent research is one that we all need to take to heart. I have two specific questions for the Minister. First, will she confirm that T-levels cannot do everything, alongside A-levels? They are a very useful qualification for a route to a post as a technician, but it is not clear that they can do everything, and so BTECs and NVQs have a lasting role in the vocational qualification landscape. On eliminating uncertainty, which my noble friend Lady Barran raised, a statement recognising that T-Levels cannot do it all would be very welcome.

My second question concerns the cost of T-levels. It has always been noticeable that in the DfE there is no money in some areas but in other areas money pours out to fund new initiatives. The Minister referred to the value of the 45-day placements. However, can she tell the House how much the funding of these 45-day placements is costing? Given that spreading access to work experience is so important, does she have any concerns that this very substantial funding for one specific way of accessing work experience is having the effect of diminishing opportunities for work experience for other students not on the T-level route?

[Baroness Smith of Malvern (Lab)]

The noble Lord is right that, when faced with a positive phalanx—I do not know what the collective noun is for former Education Ministers—it is probably wise to realise that there is some wisdom there. That has been demonstrated by the results of the review that we have undertaken.

I agree with the noble Lord that T-levels and A-levels would be an insufficient option on their own for all students. To reiterate, where T-levels exist in a route, they are the most appropriate large qualification. One of the other things that we have done is to remove the previously proposed rules of combination, which would have prevented colleges building appropriate courses for their students, in consultation with those students and others. That will provide more flexibility.

I will write to the noble Lord specifically about the cost of T-level placements, but it is right when introducing a new qualification that, as we have done, there is an uplift in revenue funding for T-level students, as well as some capital provision. Any new qualification will need a period of time to scale itself to a position where the normal level of revenue funding would be adequate to deliver it.

Universities

Lord Willetts Excerpts

Thursday 14th November 2024 Lords Chamber

[Lord Willetts (Con)]

My Lords, I congratulate the noble Baroness, Lady Warwick, on bringing this debate to the House. I declare my interests as a visiting professor at King’s College London and a member of the council of the University of Southampton. I was also one of the commissioners who served on the UUK exercise. The chapter on which I was most heavily engaged concerned international students. It is excellent that the Government are now preparing, and have committed to produce, an international strategy for higher education—of course, my noble friend Lord Johnson was himself responsible for an excellent one in the past—and I hope that the Minister will be able to tell us what timescale that is on. I shall put two specific points to her about that strategy.

The first point concerns visas. The Minister is a former Home Secretary, and if I pressed her on the cost of visas, I know exactly what her answer would be, so I will not press her on the cost but on another problem with visas: the speed of getting them. There is an internationally competitive market whereby some overseas students apply for a range of different universities around the world, and for several visas, and they are waiting to see whether they get their US visa, their Canadian visa or their British visa. If the British visa process is the slowest, they have already committed to going to Canada before we have even had an opportunity of getting them here. I hope the Minister will undertake to pursue the speed of visa issuing with the Home Office.

Secondly, I ask the Minister to raise the issue of international students with the Department for Business and Trade. There is enormous opportunity here for trade negotiations, whereby we make a commitment that we will extend access to our student loans for British students going to study abroad. The moment that the conversation with another country is about exchange and reciprocity, about saying, “We want more of your students to come here but it would be great if some British students could come to you, and we will provide them with a loan to do so”, we can make much more progress on growing international student numbers.

I very much agree with what my noble friend Lord Johnson said about fees; I strongly endorse his point. It was treated as though it were a heroically difficult decision. I asked the Library about the history. The Blair Government considered £5,000 fees; we ended up with £3,000 fees, but it was well known at the time that the Prime Minister himself and some of his advisers wanted £5,000 fees. They introduced £3,000 fees, which they indexed for several years with no fuss whatever—they just got on with indexing them. If they had done £5,000 fees and simply indexed them every year since then, fees would now be £9,545, almost identical to the level which the Government are now putting them at, but with some associated HEFCE grant; there were still teaching grants as well. The noble Baroness, Lady Blackstone, was right to say that we either need an injection of public money alongside, or fees will need to go even higher.

One of the most disappointing features of the argument about the recent indexation was the amount of confusion and misunderstanding about how the fees regime works. A lot of people linked it, somehow, to student hardship. The cash students need to live on at university is a completely different issue but does need to be tackled. Very few people realise that if the repayment formula is fixed, there is no increase in your monthly or annual repayments; it is just that you will repay for a bit longer.

One lesson from this, so that we do not slip backwards and see the type of anxieties to which the noble Baroness, Lady Blackstone, referred, is that it is really important that the Government keep on communicating the realities of how this system works, so that no disadvantaged student in a college or a sixth form thinks that he or she somehow cannot afford to go. I have to say that, in the last few weeks, Martin Lewis has once again been a voice of sanity, explaining the truth of the system, which is very different from some of the widespread misconceptions.

Unless we have a significant increase in fees, or further public expenditure support alongside, sadly, there will be universities that get into very serious difficulties. Will the Minister tell us when we are going to see a clear statement from the Government of what the process is for a university that runs out of cash? What happens? This could well be tested in the next year; we need authoritative guidance in the absence of a bolder proposal to increase fees.

Finally, I comment on one other issue. This is a Government who have an admirable commitment to raising the growth rate. Universities can really contribute to that. The industrial strategy had, I think, 11 references to FE colleges, which is admirable; it had two references to higher education, both in the context of research, and we have had eloquent statements about research. Universities are just useful for educating people in practical, vocational skills. There are 160 employer and other credentialising bodies that credentialise students who emerge from university. Will the Minister place in the Library the DfE estimates not of how many courses there are but of how many students are studying vocational courses that are in some way credentialised or vocational? Universities have an invaluable vocational role and I very much hope that, in the next stage of the industrial strategy, they are identified as a key sector, meriting particular support from the Government.

Higher Education Funding

Lord Willetts Excerpts

Thursday 12th September 2024 Lords Chamber

[Lord Willetts (Con)]

My Lords, I congratulate the noble Lord, Lord Krebs, on calling this debate and thank him for his exciting vision for our universities as the care homes of the future. I declare my interest, especially if we are talking about care homes; I am a visiting professor at King’s College London. His speech correctly identified the pressures that universities face, on both their research funding and their teaching funding. They are linked in various ways, including because overseas student fees, which used to help subsidise the cost of research, are increasingly being used to subsidise the cost of teaching, which puts extra pressures on research funding. The DSIT capacity to do research is being cut because the DfE will not increase teaching fees for undergraduates.

I think it is important that we tackle the pressures on the cost of teaching students through an increase in the fees that they pay. This is important, above all, because of the interests of students themselves in a well-funded higher education. It is also in the interests of the wider economy to have well-funded, effective higher education, with good-quality teaching.

I particularly draw the Minister’s attention to an excellent piece of research showing the economic benefits of universities, and of creating more universities, by two academics at the London School of Economics, Professor John Van Reenen and Anna Valero, who now both happen to be in the Chancellor’s Economic Advisory Council—a very useful place for them to be located.

If we are to increase funding for teaching in universities, the Minister has a mechanism available to her—fees. There may be arguments for more selective funding of research. The UKRI budget is already allocated in a pretty selective way; a very high proportion of current research funding goes to the most prestigious, elite, research-intensive universities. More research funding could be allocated, if that is what the noble Lord, Lord Krebs, wants, but it would not tackle the underlying need to have better-funded teaching across the entire sector.

There is no brilliant alternative. Of course, if fees go up, it is right to expect clear evidence that this will mean better quality teaching. My noble friend Lord Johnson of Marylebone, who increased fees from £9,000 to £9,250, did so in association with that much more rigorous assessment of teaching quality in universities.

Most depressing is the belief that this mechanism is somehow no longer available for us, despite the fact that almost every party represented in this House now has in the past used precisely such a mechanism to fund higher education. It has been the cross-party agreed basis for funding higher education over the past 20 years. I have heard people say that students cannot afford it because of the cost of living crisis, but we know that students do not pay upfront. We also know that it does not affect the amount that graduates repay; there is a repayment formula for that, which is highly progressive. Rightly or wrongly, there are no longer interest rates on graduate debt. It is reasonable to expect a prosperous middle-aged person to pay back for a couple of extra years if it means that the university education of the younger generation is properly funded. I very much hope that the Minister will accept that this is one mechanism at her disposal to tackle this financial crisis.

King’s Speech

Lord Willetts Excerpts

Friday 19th July 2024 Lords Chamber

[Lord Willetts (Con)]

My Lords, I begin by drawing the House’s attention to my interests, particularly a professorship at King’s College London and a role at the University of Southampton. I also welcome both our new Ministers to their roles. We very much look forward to engaging with them in the months and years ahead.

I congratulate my noble friend Lady Monckton on her excellent maiden speech. In her reference to her grandfather, she might have put the muzzling of cats on the political agenda. It sounds like a cause that this House might embrace.

I would also like to say how much my noble friend Lady Barran contributed to our debates on education with her extraordinary courtesy. Her speeches were always so well informed and long may she continue in a Front-Bench role.

I would like to focus on higher education, because it is crucial to the priorities the Government have set out in the King’s Speech and it is very important for opportunity. Higher education is the one stage of education where kids from disadvantaged backgrounds outperform. It is also key for growth. A lot of vocational and technical training happens in higher education. We should not have an old-fashioned picture of our education whereby that is not part of the role of universities, when it is.

Of course, higher education institutions can transform places. The journey from starting off as a mechanics institute or a teacher training college, becoming a big, ambitious FE college and then a university is often associated with the transformation and growth of a city. Worcester, if I may say so, is a vivid example of that process. Universities are one of the most powerful mechanisms we have, therefore, for spreading opportunity to some of the cold spots in the UK.

Higher education cannot do this, however, if its resources are as constrained as they are at the moment. Universities are under serious financial pressure. We all lose out but, above all, students lose out if the real resource behind their education and their university experience is being cut. I therefore very much hope that we will now see action to tackle this crisis before a university goes bust. Many are under financial pressure; some are in real danger of going bust.

We do not need another big review of our entire higher education system. All three of the main parties represented here in this Chamber, when faced with the responsibilities of office, have essentially operated the same system: a graduate repayment system. There is no fantasy alternative model that gets rid of all the imperfections of the current model. We therefore do not need to waste time on some massive review; we need instead simply to focus on improving the current system, getting across the crucial message, of course, that students do not pay up front. For students, the main issue is the cash they have to live on while they are at university. That is the pressure point threatening access, not misconceptions about the cost of fees.

There is—if I may use a rather crude term in this elevated debate—a deal to be done. Of course, Ministers and the Government will have pressures that they want to meet, so the deal must involve some increase in fees, so that universities are better funded. It should also involve more initiatives on access. BTECs are a very important part of access to university. The new Minister will notice that there is a dangerous cabal of ex-Ministers around. When I see the noble Baroness, Lady Morris, and my noble friend Lord Baker debating, it is a bit like veterans Wimbledon: you can come here and see the education debates of 20 years ago going on. However, when they make common cause on BTECs—others here also associate ourselves with that—I hope that Ministers will listen. As part of the deal, there also needs to be pressure to ensure that education standards are rising in universities and that students get a fair deal.

All that can be done and should be done as a matter of urgency. The demographic backdrop is very important as well. Because of the surge in the birth rate, reaching a peak in 2012-13, we now face a decline in the number of young people in nurseries and primary schools. The number of young people in secondary education has peaked; the next five years will see a surge in the number of people over 18. They should benefit from a reformed apprenticeship levy, high-quality further education and a properly resourced and effective higher education system.

Higher Education (Industry and Regulators Committee Report)

Lord Willetts Excerpts

Tuesday 21st May 2024 Grand Committee

[Lord Willetts (Con)]

My Lords, it has been a very interesting debate, stimulated by this excellent report. I declare my interests as a visiting professor at King’s College London and a member of the council of the University of Southampton. There is a lively debate about universities going on, particularly on this side. Let us have a proper debate about what is going on.

I want to comment on some of the interventions, particularly from some fellow Conservatives in this Committee. I very much agree with the key point by the noble Lord, Lord Johnson, that we need a regulator. I do not actually think that the old regime was as bad as is sometimes made out. HEFCE was the regulator, in reality, but its regulatory power was the power of the purse, because it was handing out grants. As the grants disappeared, so its capacity to exercise authority by attaching conditions to the grants was going, which is why, right from early on, I said that we needed a new legislative framework. I congratulate the noble Lord on bringing that in. In today’s world, the HEFCE model of regulation was very discretionary. The regulatory regime needs to be more explicit, rules based and clear, so that people know where they stand. A rules-based, transparent regulator was another of the prizes we all wanted to see from the new regime.

Also, one of my frustrations was that, having to deal with an agenda of trying to promote new players coming in, it was incredibly frustrating that they were not properly regulated. A regulator extends the capacity to regulate new arrivals. The noble Lord eloquently made the case for the OfS, but where I think I part company from him is that one reason why this report is interesting and important is that it is not the old lags who always turn up and we all enjoy our debates on higher education. This is a committee of experts on regulation who are looking at the OfS from the perspective of people who look at how regulatory regimes operate in other sectors, in other contexts. I attach some weight to their assessment, as fellow Members of this House who devote their committee time to studying regulation in different places, of how it is working in the world of HE. I understand the frustrations of my noble friend who chairs the OfS that because of this previously unknown Addison rule, he was not able to engage directly with the points that the committee makes. I am sure that there are good answers on many of them, but having this perspective from a committee that specialises in looking at regulation is a good thing.

The funding model has come up: it came up at the beginning with the noble Lord, Lord Parekh, then with the noble Lord, Lord Johnson, and from others in referring to debt. The new funding model is here to last. It was begun under the previous Labour Government. I will turn later to some of the things that we heard from the noble Lord, Lord Agnew, but from the tone of the remarks it is absolutely clear: the Department for Education is never going to find a large public budget to fund higher education. In my experience, almost every Education Secretary who turns up cares about early years and primary school. They have no desire, in any battle with the Treasury, to say, “I’m not going to ask you for more money or primary or secondary education. Please can we have more money for universities?”. They just do not, so we need another way of funding it. We have that, and it is not debt in the sense of commercial debt.

For me, it was a low point, when the argument was being made that we needed to have some increase in fees, to hear the then Minister say that we could not put up fees because it would contribute to the cost of living crisis, pandering to a deep and dangerous misconception that somehow this is money that students pay up front. It is not; what matters is the repayment formula, which of course ensures—I look again at the noble Lord, Lord Parekh—that people on low incomes do not pay back. In reality, they do not pay for their higher education; the generality of taxpayers pay for the higher education of people who are subsequently not able to afford to pay back. That is the right and progressive way of doing it.

As to how this funding compares with the money going into primary and secondary schools, I will make some quick comments on what the noble Lord, Lord Agnew, said. I can remember the negotiations with the Treasury. There used to be capital grants for higher education, in the same way as there are for schools. When people compare the figures of £6,000 for schools and £9,000 to universities, that schools figure does not include capital spend, which is a separate and substantial line item in the DfE. I remember the negotiations, and one reason why we put the fees up to such a high level was that the Treasury said, “We’re getting rid of all capital grants for higher education. In future, institutions will finance capital by borrowing on the commercial markets, and one reason for the fees is to cover the interest payments on the capital now that we are stopping having a public capital budget for HE”. That is part of the logic of the system. Their borrowing money to fund development is the new model; it was another form of expenditure saving.

Secondly, that £9,000 includes £1,000 of access spending, which is an absolute social mobility challenge but is not there to pay for the cost of educating a student. It is money to meet a social mobility objective. There are other extra costs. One of my regrets is that we call them tuition fees; they are university fees, for all the other activities that are provided for at a university.

When you look at the historical trends, as measured by organisations such as the Institute for Fiscal Studies, it is clear that in the English system the long-term trend, over 20 or 30 years, has been for public expenditure on primary and secondary education to rise relative to expenditure on students in higher education. That is the underlying long-term trend, so it is not a soft option for higher education.

It is, however, certainly the case that universities need to account for how they spend the money. This was done most recently in the Augar report, which was quite tough-minded. It commissioned an accountancy firm—I think it was PwC—that estimated the costs of higher education and provided an estimate which showed, even in those days, five years ago, that something like the £9,250 fee was barely sufficient to meet what an independent accountancy firm assessed as the cost of higher education. So the fee is looked at, and needs to be looked at, from time to time.

On data, one of my frustrations with the OfS is partly because of the flow of letters and requests that it gets from Ministers on every subject under the sun. Again, my noble friend Lord Johnson made a good point: a great self-denying ordnance would be a restriction in the number of ministerial letters so that there is some sense of strategy and capacity to get on with things. It is the basic information that students rightly care about that matters, as my noble friend Lord Lucas said. In every engagement that I had with students they made practical points. They want more contact hours but they did not want all them to be in incredibly crowded lectures; they had some views about the amount of direct contact that they had. They wanted their academic work back promptly with some kind of useful academic feedback. That is the kind of information that they wanted.

In the old days—looking back, it was perhaps a naive hope—we actually got the NUS to talk to the Consumers’ Association about the kind of data that it and the NUS could obtain to provide to prospective students by working together. There was then an outbreak of anxiety that thinking of students as consumers and working with the Consumers’ Association was ideologically incorrect. That is the kind of information that students should have good access to, and we can still do better on it. Incidentally, if one needs more information about what happens after one leaves university, the Student Loans Company is a hidden and unused resource from which the data should be liberated to make that kind of information possible.

Briefly, I have some final observations on how this argument has gone. There is an issue about promoting innovation. Again, my noble friend Lord Johnson made that point. For example, I hear that an exciting new model for engineering education in Hereford will say that showing that it has a plan for each individual student if it goes bust—it has to be a plan based on the innovative education model it is operating—is quite a barrier to it getting through the regulatory process, becoming fully entitled to give any degrees and, one hopes, getting a university title. This should be a regulatory regime that promotes innovation. That is an issue.

I turn to my noble friend Lord Agnew and his obvious unhappiness about higher education. If only some aspects of the school agenda were transported to higher education. Academies, such as the Mossbourne academy, have thrived and newcomers have come in, but the DfE assesses higher education in a different way. A Mossbourne academy higher education institution would get nowhere in the Department for Education’s model because it takes prior attainment as a measure of the quality of a university. It does not use that with schools: it looks at value added. It is prior attainment that counts for status in the world of higher education, which rewards incumbents.

That model even has a specific measure of school performance in terms of getting students through to the Russell group. I love the Russell group—it is a set of research-intensive universities—but it is massive producer capture to allow a self-organised club to become a measure of performance of a school. One goes to universities that say that the prospective students turned up and rather like what they saw but the school was keen for them to go to a Russell group university. This is a system that rewards incumbency. That is completely different from the agenda at the school level.

Of course the Russell group is excellent and research intensive, but we need to be a bit more relaxed about the different missions of different types of university. Of course many of them will deliver training, and a university can do so. We should not have our view of universities totally shaped by the Oxbridge model. The technical Hochschule in Germany that we all love are actually universities and increasingly take the title “universities of applied science”. In the Republic of Ireland, the university title is being spread. I sometimes think that if people—even, dare I say it, some on my Conservative Benches—could ritually humiliate some of these institutions and say, “You’re not really a university”, they would feel so much better about it. The truth is that those institutions are legitimate universities in almost every other western country. We should accept them and welcome them to the diversity of missions that we have in higher education today.

The OfS is doing a necessary and important job. It needs to be liberated from some of those ministerial letters and to be able to focus on the data that really matters to prospective students. I hope that the OfS will understand the importance of the context of the students that it recruits and I very much welcome this important report from the committee.

Skills: Importance for the UK Economy and Quality of Life

Lord Willetts Excerpts

Thursday 9th May 2024 Lords Chamber

[Lord Willetts (Con)]

My Lords, I congratulate my noble friend Lord Marks of Hale on a wonderful maiden speech. He is assured of a very warm welcome to our House. He gave an important and topical reminder of the dangers of anti-Semitism. For many of us, Lord Sacks is an excellent example of how the wisdom of the Jewish tradition can be of value to us all. The athleticism of the noble Lord, Lord Marks of Hale, is also clearly very impressive. We look forward to seeing his running shoes alongside the mobility scooters downstairs. I am sure that he will be an important contributor to our debates in this House.

I also congratulate the noble Lord, Lord Aberdare, on opening and setting the scene for this important debate on skills. I draw the House’s attention to my interests.

I will focus on two issues. The first is the future of BTECs, which are important vocational qualifications, introduced as a skills reform in the 1980s—I am looking across to the former Secretary of State—and which play an important role in providing vocational qualifications today. The Government appear to believe that they can defund BTECs and everyone will instead move on to T-levels, but the figures do not bear that out. In 2021, 5,300 students started T-levels, and one-third dropped out, compared with one-fifth dropping out from other vocational qualifications and one in 10 dropping out from A-levels. The Sixth Form Colleges Association estimates that, in comparison with the low numbers doing T-levels, defunding BTECs could result in 155,000 students not having a level 3 qualification that they otherwise would have secured through the BTEC route. I very much agree with the warnings from the noble Baroness, Lady Garden, on that issue.

BTECs matter. They are a route into degree apprenticeships, to which Ministers rightly attach a lot of importance. They are a route into higher education, with perhaps 60,000 people getting places in higher education as a result of BTECs in important vocational courses, such as nursing.

We have discussed BTECs in this House before, and I informed the Minister that I would raise with her the assurance that she gave us in a debate in this House on 7 April 2022:

“I know that noble Lords are all interested to see the provisional list of qualifications that overlap with waves 1 and 2 T-levels. I want to be absolutely clear to your Lordships today that through this process we expect to remove public funding approval for just a small proportion of the total level 3 offer, including BTECs. This will be significantly less than half”.—[Official Report, 7/4/22; col. 2202.]


That quotation from Hansard was the assurance she gave us approximately two years ago. I would be very grateful if she could update us on how the defunding of BTECs is progressing. It is possible that, in her statement to us two years ago, when she referred to “this process” she was not referring to the full defunding of BTECs but simply to overlap. I would very much like to hear the Government’s estimate of the total number of BTEC and other advanced qualification enrolments, after they have completed the full defunding process. A useful baseline is the 248,000 BTEC/AGQ enrolments in 2022-23. What is the Minister’s latest estimate of how many BTEC courses will be defunded? How many people will be enrolling on BTECs at the end of the full process of defunding BTECs, compared with that baseline of 248,000? As I said, I gave the department advance notice of this question and very much hope that, in the light of our previous debates, we will get those estimates today.

I also ask the Minister—given the slow take-up of T-levels, and given that we now know the Government do not see T-levels as part of a long-term framework—whether they are in turn going to be replaced by this new advanced qualification. Is there not an even stronger case for pausing the defunding of BTECs to reduce the risk that tens of thousands of young people might find themselves without any suitable qualification that they can study and end up not in education, employment or training? It would be a tragedy if the defunding of BTECs have that result. Given the latest information on the uptake of T-levels, I very much hope the Minister will be able to make some concessions on that.

The second issue I want to briefly touch on is degree apprenticeships. I very much welcome degree apprenticeships—they are an important part of the options available. It is just worth, again, putting the figures in context. There are now about 40,000 enrolments in degree apprenticeships, but half those are by people aged over 25. They seem to be particularly taken up by mature learners. We have about 20,000 young people starting degree apprenticeships, about 10% of the total number starting in higher education.

The noble Lord, Lord Aberdare, rightly raised the question of the apprenticeship levy and the pressures on it. Degree apprenticeships are funded out of the apprenticeship levy. They are particularly expensive programs. If they are a significant claim on the apprenticeship levy, their growth is surely part of the answer to the question put by the noble Lord, Lord Aberdare: why are we seeing such a decline in the number of young people doing apprenticeships and apprenticeships at levels two and three? The answer is that this fixed pot of money is being increasingly deployed for degree apprenticeships.

I wish to see more expansion—as the noble Lord said—of apprenticeships for younger people and at lower levels. I urge the Government to consider funding degree apprenticeships out of fees and loans, just like the rest of higher education, to liberate funding for more apprenticeships. That would also have the side effect that, instead of trying to drive people on to degree apprenticeships by scares about the fees and costs of higher education, we would have a shared interest in explaining to young people that they do not pay for their higher education courses upfront and they should have the option of a growing number of degree apprenticeships alongside other higher education qualifications.

--- Later in debate ---

[The Parliamentary Under-Secretary of State, Department for Education (Baroness Barran) (Con)]

My Lords, I am grateful to all noble Lords across the Chamber for their contributions. I thank the noble Lord, Lord Aberdare, for securing this very important and well-supported debate. It was an honour to be present to hear the maiden speeches of my noble friends Lord Marks of Hale and Lord Elliott of Mickle Fell. Listening to a maiden speech reminds us all just what a privilege it is to serve in your Lordships’ House.

If I may, I will step back and remind noble Lords what the Government are looking to achieve with our overall programme of skills reform. The noble Lord, Lord Aberdare, started by talking about the need for a strategy. I hope he recognises many, if not all, of the seven points in his speech in the Government’s approach.

The Skills for Jobs White Paper, published in January 2021, is the blueprint for our reforms. It sets out the case for change and the vital need to drive up skills in our country. We know that a third of productivity growth can be attributed to increases in skills levels. I join other noble Lords in thanking my noble friend Lord Baker for his work over many years to bring a focus to the skills agenda. But we still face significant gaps in skills at higher technical levels, with level 4/5 being the highest qualification for 10% of adults, compared to 20% in Germany and 34% in Canada. 

My noble friend Lord Patten was absolutely right to highlight the importance of improving productivity in the public sector as well, and my noble friend Lord Holmes was right to stress the importance of inclusivity and innovation in developing skills programmes.

The gaps in our skills are creating significant challenges in the labour market. As we heard from a number of noble Lords, employers report that they cannot find people with the skills they need, particularly the technical skills that drive innovation and enable adoption of new technologies. I acknowledge the points raised by the noble Baroness, Lady Coussins, regarding foreign languages, but I may need to address some of them in writing.

As it stands, a quarter of job vacancies in the UK are due to skills shortages. Some estimates show that, by 2030, we will face a global skills shortage of 85 million. There are major challenges for the future, as we know from research published by the department’s Unit for Future Skills, which estimates that between 10% and 30% of jobs could be automated through AI. The significance of AI was brought out powerfully by my noble friend Lady Fairhead. That is why we have introduced a series of reforms, with the aim of developing a world-leading skills system that is employer-focused and fit for the future. This is backed by an investment of £3.8 billion over the course of this Parliament to strengthen higher and further education. The noble Baroness, Lady Wolf, spoke about the need for stability in the skills system. Probably the strongest thing we hear from employers is that they want stability so they can plan and invest.

The noble Baroness, Lady Wilcox, asked about opportunities for lifelong learning. I remind her of the important lifelong learning entitlement, which will transform opportunities to upskill, reskill and develop skills throughout one’s lifetime.

I will divide my remaining remarks into three broad categories, focusing on an employer-led skills system, our support for priority growth sectors, and the reform of qualifications. I hope that addresses the spirit of the remarks made by the noble Lord, Lord Birt, about looking at this issue in the round and not in a fragmented way.

As the noble Lord, Lord Aberdare, said more eloquently than I can, employers need to be at the heart of our skills system. The Government have worked hard to bring education and business together so that skills and training provision directly support economic growth and productivity. The Government are proud of their new high-quality apprenticeship programme. Nearly 700 apprenticeship standards are now available, covering around 70% of occupations in this country. The noble Lord, Lord Aberdare, asked about the drop in the number of apprenticeships. I think he knows what I am going to say: we focused very much on quality, so we took out apprenticeships that did not deliver for apprentices. I say to the noble Baroness, Lady Wilcox, that I am not sure what changing the name of the apprenticeship levy achieves, but I think that Labour’s proposals are estimated to halve the number of apprenticeships, which would have a very serious impact on our economy.

I thank my noble friend Lord Harrington for acknowledging the value of the apprenticeship levy. I will address some of his concerns, and those of the noble Baroness, Lady Garden, about reform of the levy. We already pay 100% of the apprenticeship training costs for 16 to 21 year-olds in respect of SMEs. We have also doubled the levy transfer limit from 25% to 50% so that levy payers can maximise the benefit of their levy funds.

The noble Baroness, Lady Wolf, gave us her expert insight into the importance of level 3 apprenticeships. As she is aware, they are the most popular apprenticeships, accounting for 43.3% of starts in the current academic year. We now have 229 apprenticeships standards at level 3 and an active apprenticeships campaign promoting both level 2 and level 3 apprenticeships.

My noble friend Lord Harrington noted the importance of manufacturing apprenticeships. The Government are investing £50 million in a two-year pilot to support providers to deliver more high-value apprenticeships, particularly in areas such as engineering, advanced manufacturing, green technologies and life sciences.

My noble friend Lord Lucas talked about the importance of micro-credentials. He will be aware that we have introduced skills bootcamps, which provide flexible training for adults aged 19 and over, which are directly linked to roles in priority sectors. These, again, were courses that were designed and delivered in partnership with employers to respond to their needs. There are now more than 1,000 skills bootcamps available across England.

Turning to the local skills improvement plans, I thank the noble Baroness, Lady Lane-Fox, for her leadership in this area. I was glad to hear how important and innovative that direct link is—if I followed her remarks correctly—between business, higher education and further education, just getting people in the room together to work out what an area needs.

The noble Lord, Lord Aberdare, asked about oversight of the LSIPs. The employer representative bodies are now leading on implementation and review of the plans, and each of those bodies will publish a public annual progress report in June 2024 and June 2025, setting out their progress.

We also think the introduction of institutes of technology is extremely important. They are collaborations between colleges, universities and business, designed to deliver the best technical education and help businesses to get the workforce they need. We will have 21 of these new institutes in place from September.

The noble Lord, Lord Mair, said that—I hope I wrote this down correctly—20% of adults in Germany have higher technical qualifications, and that this is an important gap in our skills landscape. That is why we have introduced HTQs to meet exactly that need at levels 4 and 5. They have a quality mark that is awarded only to those qualifications that deliver the skills employers need. That also speaks to the point about recognition of qualifications that the noble Earl, Lord Clancarty, referred to. To date, 172 qualifications have been approved as HTQs across seven routes. The Government have also sought to prioritise five sectors that are critical to driving our growth in the 21st century: green industries, digital technologies, life sciences, creative industries, and advanced manufacturing.

The noble Baronesses, Lady Hayman and Lady Bennett of Manor Castle, and the noble Lord, Lord Mair, all talked about the importance of green industries. The net-zero growth plan sets out how the Department for Education is empowering people to get skills for green jobs, but this challenge is a very significant one, whether it be in relation to workers in offshore wind or, as the noble Baroness, Lady Hayman, used as an example, in relation to heat pumps. We are funding a range of apprenticeship standards in green occupations, including level 4 electrical power networks engineering and new low-carbon heating technician apprenticeships. We also have T-levels to support this area in construction engineering and land management.

The noble Baroness, Lady Hayman, asked about the nature action plan. On timing, the technical answer is “soon” but not “in due course”—that is the good news. We have made a public commitment that it will be published in the first half of this year, and that public commitment still stands. I think that is “soon”.

Digital technologies are a foundation for our economy, but 18% of the UK labour force do not have the essential digital skills that they need for work. The noble Lord, Lord Griffiths of Burry Port, asked about cross-departmental working. As an example, we are working closely with DSIT to convene the Digital and Computing Skills Education Taskforce, aiming to increase the number of individuals taking digital and computing qualifications and attracting people into digital jobs. We have invested over £100 million in the National Centre for Computing Education, to improve teaching of and participation in computer science GCSE and A-level.

I recognise very much, in my noble friend Lady Fairhead’s comments about AI, the pace of change and the difficulty in government to stay ahead of the curve. I hope the House agrees that my right honourable friend the Prime Minister has given great leadership in the area of ethical AI and safety in AI. My colleagues in the department are also making great progress, and I look forward to being able to update the House on some of those activities in due course.

The third area of focus is on life sciences. The UK life sciences industry is one of the largest in the world, with the potential to create up to 133,000 new roles in 2030. Through the Office for Life Sciences, my department is working with employers and industry bodies to identify and address skills challenges.

The noble Lord, Lord Griffiths of Burry Port, talked about the importance of the creative industries. This is one of the fastest growing sectors of the UK economy, and we have clearly set out the Government’s ambition—shared with industry—to support a million new jobs through education and skills objectives, in our creative industries sector vision. We have developed 57 creative and design occupational standards and we have more flexible training models to support apprenticeships in the creative industries, where short-term contracts or other non-standard employment models are the norm.

Finally, our fifth area of strategic focus is on advanced manufacturing. Manufacturing provides 2.6 million jobs in the economy—7% of total employment—but there are currently 70,000 vacancies. Our plan sets out our ambition to establish an advanced manufacturing skills forum with the National Manufacturing Skills Taskforce. Again, this is supported by skills bootcamps and T-levels, to create a pipeline of skilled workers.

I turn to our qualification reform, which was a subject of interest for my noble friends Lord Willetts and Lord Lingfield and the noble Baroness, Lady Garden. As the House knows from our debates on this subject during the passage of the skills Bill, we aim to fund only qualifications that are of the highest quality and lead to good progression outcomes. T-levels are delivering fantastic results for those 16 to 19 year-olds across the country. I encourage my noble friend Lord Lingfield to perhaps meet some of those students with me, because they are delighted by their courses. Over 30,000 young people have now enrolled on a T-level since their launch four years ago, with roughly 16,000 enrolling in the last year.

My noble friend Lord Willetts asked some very specific questions about the precise number of qualifications that will have funding removed and the number of students taking them. I will cover some of those points now, but I will also write to him and put a copy of my letter in the Library, because this is a slightly complex area. We have not yet finished all our decision-making on the funding of qualifications, but we have published the number of courses and enrolments, rather than students, where either funding is being removed or we are considering it, and I will put the links to that information in my letter.

As the House knows, we are removing public funding from qualifications in phases. The first phase was for 5,500 qualifications, which had either no or very low enrolments. The second phase is for the removal of funding from qualifications that overlap with T-levels. The final phase relates to our approval process through which alternative academic qualifications must go to be funded from September 2025.

On the second phase—the removal of funding from qualifications that overlap with T-levels—waves 1 and 2 covered about 130 qualifications and about 39,000 enrolments. Within that, there were 10 qualifications that had more than 1,000 enrolments. Wave 3 covered 85 qualifications with 17,000 enrolments, and there were five qualifications with more than 1,000 enrolments. Wave 4 is expected to cover around 70 qualifications and 32,000 enrolments, of which nine qualifications had more than 1,000 enrolments. I raise the point about the relatively small number of qualifications with large numbers of enrolments because my noble friend Lord Lingfield talked about T-levels being too complicated, but the existing system is extremely complicated. We want to bring simplicity and clarity to the quality of the qualifications that young people are undertaking.

The final reason why I would like to write to my noble friend, rather than try to explain this in any more detail at the Dispatch Box, is that T-levels are very large courses covering a variety of occupational specialisms and lasting two years. The qualifications being defunded are of different sizes; some can be very small, and one person could take several enrolments. The enrolment data for older-style qualifications cannot be directly compared with T-levels, which are much larger. I assure my noble friend and the House that students will continue to have a range of options available to them at level 3, in addition to A-levels and T-levels, including new technical occupational qualifications and alternative academic qualifications, helping to ensure that all students have a range of options. Each one of those will have employer standards and occupational standards at its heart.

[Lord Willetts (Con)]

I am very grateful to the Minister for the full answer she has already given. Can she give her assurance that the measure of enrolments, which I understand is not the same as the number of students, going back to the baseline that I referred to, will be in her letter to me?

[Baroness Barran (Con)]

It will.

I turn to the wider points raised about the curriculum by my noble friends Lady Sater and Lord Effingham, the noble Lord, Lord Hampton, and the noble Earl, Lord Clancarty. To critics of the curriculum, I say as a starting point that we work very closely with the Education Endowment Foundation, which gives a robust, highly respected and independent evidence base about all the reforms that we have undertaken, so there is nothing ideological in what we are doing in our schools. It is based on the best available evidence, including randomised control trials and other similarly robust approaches.

I absolutely agree with the noble Earl, Lord Clancarty, that it is a bit artificial to separate knowledge and skills; it is the combination of the two that is powerful. I agree with my noble friend Lady Sater about the importance of confidence and agility, but we believe those are based in a knowledge-rich curriculum that fosters competence and mastery in a subject. I may have to include my response about storming the barricades with the noble Lord, Lord Hampton, in my letter. All I can say at this point is that it sounds an interesting option.

In relation to my noble friend Lord Effingham’s question regarding prohibition of phones, if additional evidence emerges that they are a problem—we know that most schools already prohibit phones in some way—we will seek to make our guidance statutory. The noble Baroness, Lady Valentine, emphasised the importance of careers. I remind the House that in the financial year 2024-25 we are investing more than £90 million in high-quality careers provision for all.

I am running out of time. My last point is to acknowledge the point made by my noble friend Lord Lilley that the Government cannot make a success of these skills reforms on their own. Employers must also do more to support the development of workforce skills. We have seen employer investment in training fall by 7.8% in real terms between 2017 and 2022. As my noble friend said, we must move away from reliance on migration to fill skills gaps and towards investment in the skills of our domestic workforce.

Higher Education

Lord Willetts Excerpts

Thursday 7th March 2024 Lords Chamber

[Lord Willetts (Con)]

My Lords, I congratulate the noble Lord, Lord Blunkett, on initiating this debate. Finding myself standing opposite him in the Chamber responding to a debate that he has initiated reminds me of when I was his shadow in another place years ago. It reminds me in particular of an incident when, as I spoke, I could see the then Secretary of State looking increasingly uncomfortable and challenged. I thought, “My points must be getting through”—until I realised that what had actually happened was that his guide dog had been sick on the Floor of the Chamber of the House of Commons, which he kindly pointed out was the guide dog’s assessment of the points I was making as shadow Secretary of State. So I hope to manage a little better this time.

It was an excellent intervention with which the noble Lord began. He was bringing all of us, from all sides of the House, to recognise the qualities and strengths of our higher education system. It is not perfect, it faces real challenges and there are areas where it is underperforming, but the system as a whole is a good one. I am a bit uncomfortable when it is always praised in terms of “four of the top 10 universities” or “25 in the top 200”. That way of assessing the quality of our higher education system does not reflect the truth that it is a very diverse system. There is no one way of being a good university. Of course, those globally respected, research-leading universities at the top of the league tables are excellent, but there are other ways of being excellent. You can be an excellent vocational university, focusing on skills requirements in your area. You can be a university that is excellent in teaching, focusing on teaching rather than research, as the tech initiative of my successor, the noble Lord, Lord Johnson, brought out. We must celebrate the strengths of a range of universities doing different things, and I hope that the Minister in her remarks at the end will make that point.

The system also needs greater diversity, and we have already heard about degree apprenticeships, which are a very welcome addition to the range of higher education provision. My noble friend Lord Patten asked about their growth. The truth is that they are funded—nothing comes for free—to the tune of almost £30,000 out of the apprenticeship levy. They are reported to be taking approximately 20% of the apprenticeship levy and, in turn, Ministers report that the apprenticeship levy is 99% spent. It would be very interesting to hear from the Minister, if degree apprenticeships are to expand, how this growth will be funded and whether it will mean, if it remains a charge on the apprenticeship levy, that other forms of apprenticeship, often more focused on young people, suffer by comparison. While they are an excellent initiative, there is some uncomfortable evidence that, for any given discipline and compared with conventional university courses, degree apprenticeships appear to be more socially selective, less likely to take people from deprived backgrounds and less likely to take young people—more than half of those on degree apprenticeships are over 30. What more we can do to extend access to degree apprenticeships is something on which I think we would like to hear more from the Minister.

Finally, as time is tight, I will just comment on the—as always—interesting observations from the noble Baroness, Lady Wolf. There is not simply a utilitarian defence of higher education. Again, it was the noble Lord, Lord Blunkett, as Secretary of State, who commissioned an excellent research exercise on the wider benefits of learning that is still yielding findings and results to this day. When we at the Resolution Foundation—one of those think tanks—recently did work on mental ill-health among young people and economic inactivity, we found that young people who had been to university were still quite likely to suffer mental ill-health. However, it looked as if having been to university made them more resilient. They were more likely still to be in work even while suffering episodes of mental ill-health than people who had not had that opportunity. So there are wider benefits of higher education that extend beyond those that are subject to immediate economic calculation and this debate is an opportunity to repeat the point.

Lifelong Learning (Higher Education Fee Limits) Bill

Lord Willetts Excerpts

Report stage
Tuesday 5th September 2023 Lords Chamber

[Baroness Wilcox of Newport (Lab)]

My Lords, I rise to speak to Amendment 4, which would require the Secretary of State to publish a review of the lifelong loan entitlement before bringing in further regulations on fee limits. I welcome the Minister's comments in Committee, and I fully understand her feedback about what information will accompany further regulations as these changes are rolled out.

We have brought this amendment back to further raise the point about ensuring that students, the sector and Parliament are given clear information on the details of the LLE as soon as possible. Throughout the passage of this Bill, we have raised concerns, often after input from those in the higher education sector, that so little about the LLE in terms of course provision, maintenance, credits, transfers, and further rollout of modular study at other levels is confirmed in any meaningful detail.

I am none the less grateful that, following Committee, the Minister outlined further details of the LLE that relate to this Bill in a letter. However, as we know, this huge shift in higher education policy goes further than fee limits. We all want this change to work, but for that to happen the sector will need much more clarity than has been provided through this very narrow Bill.

The accounting officer assessment for the LLE states:

“The main feasibility risk of LLE is meeting the 2025 delivery timescale”.


Is the Minister still confident that the department will be able to deliver on time, particularly in the light of current pressures arising from the major emergency that the department is currently dealing with in school buildings across the UK?

My next question follows on naturally: what is in place if this timescale turns out to be unworkable? There are a great many sector stakeholders—as well as the students themselves, of course—who will need clearly communicated timelines. Amendment 1 from the noble Baroness, Lady Garden, puts in the Bill the number of hours that constitute a credit. We understand why she tabled that amendment: it is important that the sector is given clarity and control over the definition of working hours and that it is consistent with the QAA’s higher education credit framework. As she noted, her concern is about the lack of detail. This is one of many areas in which the higher and further education sectors still have questions about how a credit will be defined.

The concept of a credit in education terms will also be completely alien to the general public, and there is a risk that employers simply do not understand its value. The Government need to think about how this can be communicated. We do not believe that putting a number in the Bill at this point would be beneficial. However, we would like a commitment from the Government that they will not seek to amend the value of a credit and will be led by the sector’s understanding of it.

On Amendment 2, I am glad that the Minister has outlined the Government’s plans to ensure sharia-compliant loans in writing; we look forward to receiving further engagement on this issue as the LLE progresses. But, as the noble Baroness, Lady Garden, pointed out, there is a distinct problem with skills gaps—a lack of applicants with the right skills. The economy cannot move forward appropriately with skills shortages.

[Lord Willetts (Con)]

My Lords, the amendments reflect widespread cross-party support for the Bill and its principles; they are not intended to destroy the Bill in any way. I see the case for the Bill, which of course I warmly welcome, as opening up new possibilities. We genuinely do not know the circumstances in which people may take them up and we do not know whether debt aversion is much more of an issue among mature learners than among young people aged 18 or 19; we will find out only if we give this a try. Similarly, we do not know how much suppressed demand there is for level 4 or level 5 qualifications because of the way in which loans are currently structured; we will find out only if we give this a try. So this is definitely worth going forward with.

I have three brief comments on the amendments. First, one of the temptations we have in this House— I have occasionally succumbed to it myself—is to try to determine the details of policy through primary legislation. That is one of the risks in Amendment 1, with its specification of the definition of “one credit”. Of course, it is an important and interesting area but, as we are embarking on a journey with a new and more flexible system, trying to put that into primary legislation would inhibit necessary policy flexibility—a point that I think the noble Baroness, Lady Wilcox, referred to.

Secondly, I agree with the point made by the noble Baroness, Lady Garden, on sharia-compliant loans. We have been at this for 10 years now, and it really is time that a scheme such as this were available and in force. There were initially some tricky problems, but I think that the long work that the department has done over the years has resolved them. My understanding is that the technical and theological issues have been addressed. I know that the Minister herself is keen to get on with this, so anything that she can say to the House about her commitment to that timescale would be very welcome.

Finally, on Amendment 4, I am proud to say that I am acting as the spokesman for the noble Baroness, Lady Wolf. She very much regrets that she cannot be with us; she briefly appeared, but I think she had to catch a plane to Lithuania. In many ways, she is the intellectual origins of the Bill. I know that her spirit is that she wants to get on with it. Her concern about this amendment—which I completely understand and support—is that requiring another review before we can get on with things will slow down the pace still further. I think that the mood across this House is that we want to get on with it; we do not want reasons for further delay. I fear that Amendment 4 would constitute another obstacle to this potentially important and significant innovation in policy, which I warmly support.

Lifelong Learning (Higher Education Fee Limits) Bill

Lord Willetts Excerpts

Monday 10th July 2023 Grand Committee

[Lord Aberdare (CB)]

My Lords, I support Amendment 7, looking to review how the Act is working. I regret that I was not able to speak at Second Reading.

I shall mention some specific issues that I hope such a review would include, reflecting some of the briefings that I and, no doubt, other noble Lords have received. The list of items to be covered mentions the provision of courses offered by higher education and further education providers, but nowhere in the amendment or indeed in the Bill is there any reference to independent training providers, one of my hot buttons. Yet ITPs are likely to play an important part in delivering LLE-funded courses and indeed modules.

There are two specific issues relating to ITPs. The first is that the process for applying for and gaining recognition as a provider in this field needs to be straightforward and efficient. It is good to see the idea of the third recognition route for providers via the Office for Students.

The second, which I suspect the Minister will have less flexibility in responding to, is that, for many of the courses they offer, independent providers have to charge VAT, even though FE colleges providing very similar courses do not, so there is a fundamental issue of fairness there. I know that VAT is largely untouchable, but the advantage of a review such as this is that it might highlight some of the impact of that competitive disadvantage.

The second concern that has been raised is the possible impact on creative subjects. They can be expensive to deliver, requiring extra resources and facilities, and are often seen as less valuable in the world of employment and work, although that is something I would strongly dispute. It would be welcome if the Minister could reassure us, or if the review could help to demonstrate, whether creative subjects are playing their fair part in terms of the courses being offered and taken up.

The third issue is a robust system of information, advice and guidance to support the LLE in general, both to ensure that young people—indeed, all people—considering taking up courses by using the LLE should be clear about what the opportunities, impact, risks and costs are, and to provide good information to potential providers. I am thinking specifically of SMEs, which, again, have an important role to play but may need lots of support and information in order to know how to play it.

That would all feed into the various uptake headings—the first three all relate to uptake by learners—so a review as proposed by the amendment would be really helpful in making sure that the aims of the Bill, and indeed of the lifelong learning entitlement as a whole, are being met. I hope the Minister will be able to tell us something about how the Government are planning to review these issues anyway with or without the amendment, but the amendment is a jolly good idea.

[Lord Willetts (Con)]

My Lords, I shall indeed ask some further questions of the Minister arising from the proposal in this amendment, because I think that it is aimed at learning as much as possible about this very bold initiative. First, following on from some of the points made by the noble Baroness, Lady Twycross, how will this scheme interact with employer spending? Clearly there are upsides and downsides. It is possible that the ability to spend some money from this loan alongside spending from an employer will make vocational courses and provision viable when they otherwise would not have been, and that is a good thing. On the other hand, there is the risk of some employers shedding their responsibilities and expecting an employee to use this loan scheme to finance training that they would otherwise have funded. It would help a lot of us if in her answers—they are always very helpful and informative—the Minister could explain exactly how the Government envisage they are going to monitor and manage that process so we know how we get the best possible outcome of the extra total spend on training and not the worst outcome, which would be the taxpayer simply picking up more of the bill with no increase in the total. Any indications on how employer spending might react would be very helpful.

Secondly, on the provision of courses offered by higher and further education providers, the Minister will know that I am interested in one possible use of this scheme being that at last we have a clear indication of public finance through loans for four years of higher education. Of course, that could be taken at different points over someone’s life in lots of different engagements with higher education, but equally, it could be four years in one go. If she could offer an indication of the Government’s support for that way in which students could benefit, it would be helpful.

I hesitate to add any suggestions of uncertainty when there is quite a lot of cross-party consensus on this issue, but it would be understandable if some people young thought “I don’t know how long this lifelong loan scheme is going to be around; if I’m currently eligible for it, I am going to take my chance now and get on with it rather than necessarily being confident it’s going to be around in 20 years’ time when I’m at a different stage of my career”. Being clear on the opportunity for people to take a four-year loan now would be helpful, and I hope the Minister can inform the Committee further on that.

[Lord Storey (LD)]

I rise to support my noble friend Lord Addington’s amendment. I want to tease out of the Minister some answers on sharia law and its effect on accessing education opportunities for all. I was with a group of about a dozen Somali women on Sunday. They have that conflict between faith and education. The Minister will remember that in 2014—nine years ago—the Government published a report on Islamic finance in the UK that acknowledged the lack of an alternative financial product to conventional student loans. It was a matter of concern. The report also identified a solution: a frequently used non-interest-bearing Muslim financial product. The Government explicitly supported the introduction of such a product. However, since then no sharia law-compliant student finance scheme has been made available. Why not, Minister, and what we are going to do about it?

Lifelong Learning (Higher Education Fee Limits) Bill

Lord Willetts Excerpts

2nd reading
Monday 19th June 2023 Lords Chamber

[Lord Willetts (Con)]

My Lords, I welcome the Bill. I begin by drawing the House’s attention to my interests as an honorary fellow of Nuffield College, Oxford, and a visiting professor at King’s College London. I also look forward to the two maiden speeches from new Members of this House, although it appears that both of them are significantly older than 29. We look forward to learning of their experiences.

The Bill is a very welcome measure, which brings extra flexibility into higher education and has the potential to yield bold reforms in how higher education is delivered. I very much hope that it works and succeeds in promoting access to higher education, but I warn the Minister that I hope that therefore it avoids the mistakes and problems that I experienced and which were referred to by the noble Baroness opposite when she talked about the decline in adult learning post 2010. We were actually very optimistic: we thought that extending larger fee loans to adult and part-time learners would maintain or even increase demand for higher education from them. However, it did not play out like that.

As I looked back on why that expectation that I had was not fulfilled, the lesson that I and others drew was that, for an 18 year-old, at a massive fork in the road in their life, choosing between going into higher education and doing something different—perhaps going into work—the overall benefits of higher education were clear and obvious, and they were willing to take out a loan, on the basis of payback if they were in a well-paid job. However, for someone already in work, who already has family commitments and who cannot be confident that taking a particular modular course will necessarily transform their earnings and opportunities, it does not look quite such an obvious and attractive option to take out extra debt—even though, as we all understand in this House, it is nothing like conventional debt. Given that that is the experience of the past decade or more, I very much hope that the Minister will be able to explain to the House why these lifelong loan entitlements will be successful in promoting demand for adult learning.

As we have already heard, there are then a set of issues about the supply of provision. It would be very interesting to know what scope there is. Perhaps the Minister is already in conversations with the Treasury about the circumstances in which these loans will be available to people. There may even be estimates going back and forth of the so-called RAB charge—how much of the loan is going to be written off. I hope that the Minister is successful in these discussions, but the more that she can share with us the information about what kind of provision she thinks she will be able to offer, as well as who is going to be making this provision, the more helpful it will be. It is possible that one of the most important and radical measures in the Bill is the new third category of registration with the Office for Students, which would enable new providers to come in and supplement existing provision from established universities. Can she share with the House a bit more information about how the new third category is going to operate?

I have some brief, specific questions. Obviously, one model is that we find that this entitlement is taken up by people dipping into more higher education later in life, but will the Minister confirm that this is a four-year entitlement that will be available for people after they start from university in the near future? Therefore, it would be perfectly possible for a new student to embark on a four-year course with a full four-year entitlement. Indeed, it may be—given the anxieties among adult learners—that the biggest growth is in four-year provision among new undergraduates. Will the Minister confirm that, if that means more people getting useful higher education for longer, that is something that the Government will welcome and support?

There has been a lot of concern expressed by the OfS and others about so-called positive outcomes from courses. One way in which you do not get a positive outcome is supposed to be if you drop out. We are used to a view of higher education whereby dropping out is a bad thing. However, it is very difficult to reconcile the rhetoric of dropping out being a bad thing with the celebration of people dipping in and out of higher education—doing a short course, then withdrawing for whatever reason, then coming back to do some more higher education study. If the OfS is going to carry on monitoring and criticising universities with high drop-out rates, and we are also going to encourage flexibility and moving in and out of higher education, I am sure that, if there is any person who can reconcile these two rather different approaches, it is the Minister in this House, and we very much look forward to her account of how the regime will operate. The fact is that some flexibility is actually a good thing, and the Bill is an opportunity to recognise that.

Finally, I hope the Minister will, in the course of our scrutiny of the Bill, share with us more about the metrics the Government will be using for success. How will we assess how well this is doing? What levels of take-up might we expect, what type of courses might students be doing, and how rapidly will she perhaps succeed in reaching her agreement with the Treasury on the scope and ambition of the actual provision that follows?