Apprenticeships and T-Levels

Neil O'Brien Excerpts

Wednesday 20th November 2024 Westminster Hall

[Neil O'Brien (Harborough, Oadby and Wigston) (Con)]

I am grateful for the opportunity to speak in this debate.

I congratulate my right hon. Friend the Member for East Hampshire (Damian Hinds) on securing this super-important debate. All Westminster Hall debates are equal, but some are more equal than others, and when I saw the title of this debate and that it was being led by my right hon. Friend, I knew that it would be a good one.

I have not been disappointed at all, nor have I been disappointed by the excellent speeches by the hon. Members for Dudley (Sonia Kumar), for Sutton and Cheam (Luke Taylor), and for Mansfield (Steve Yemm); by my hon. Friend the Member for Broxbourne (Lewis Cocking) and by the hon. Members for Bournemouth East (Tom Hayes) and for Hartlepool (Mr Brash); by my hon. Friend the Member for Mid Leicestershire (Mr Bedford) and by the hon. Members for Stoke-on-Trent Central (Gareth Snell), for Westmorland and Lonsdale (Tim Farron), and for St Neots and Mid Cambridgeshire (Ian Sollom). There was also a rare appearance in Westminster Hall by the hon. Member for Strangford (Jim Shannon), which I am sure we all savour. [Hon. Members: “More!”] More indeed.

My right hon. Friend the Member for East Hampshire did a superb job in giving us the fruit of his many years of experience and his multiple periods of service in public life, including two stints in the Department for Education, regarding this issue. He talked about the alphabet soup of organisations and qualifying bodies, the traineeships, the apprenticeships, the modern apprenticeships, the City & Guilds, the GNVQs, the NVQs, the Skills for Life, the diplomas, the BTECs and now the T-levels. The question now is this: will T-levels just be another element added to this alphabet soup, or will we actually realise the vision of what we have called the Sainsbury routes and rationalise the system? My right hon. Friend asked big questions about where the Government are going with traineeships, the apprenticeship levy and Skills England, and it will not surprise him that I will pick up on those questions.

I have several questions for the Minister. First, do the Government have a forecast for the number of apprenticeships that will start over the course of this Parliament? Such a forecast has certainly existed in the past; I saw one when I was in government. Do the Government have such a forecast? If so, will they publish it? What is the forecast number of apprenticeships that will start over the course of this Parliament? I ask that question because unless we know that baseline, we cannot ask sensible questions such as “What will be the impact of the growth and skills levy on the number of apprenticeships?” Without the baseline we cannot have a debate about the trade-off between one desirable thing, which is more flexibility for businesses, and another desirable thing, which is more apprenticeships.

Is it still the Government’s policy to allow 50% of levy funds, rather than a specific number, to be spent on non-apprenticeships, or will it be perhaps another percentage now? What is the impact of the national insurance increase, first, on the number of apprenticeships —that is why we want to know the baseline number of apprenticeships—and, secondly, on the FE sector more generally? The national insurance increase is focused laser-like on lower-income workers, which particularly hits apprentices and people in the FE sector, so there is every reason to think that it will be particularly impactful for those two groups. Will the FE sector be fully compensated for the national insurance increase, or not?

I echo some of the excellent questions that the hon. Member for Bournemouth East asked about college funding. As the Minister knows, colleges are now classified as part of the public sector, but unlike other parts of the public sector they are not exempt from paying VAT. Is it the Government’s intention to change that situation or not?

The other day, Baroness Smith of Malvern said that college staff were “rightly” disappointed that they were not given the same pay increase as schoolteachers. She implied that the Government would seek to close that historic gap; it has existed for many decades. I am not asking for miracles from the Government; this is a very long-standing challenge that everyone says is a problem. It has become slightly worse in the first pay round under this Government; the gap has grown a bit more. Is it the Government’s long-term aspiration to close that gap between sixth-form college teachers and teachers in schools? I am interested in whether that is the direction of travel.

Will the Minister also answer some structural questions? The Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill is obviously going through the Lords at the moment. We have already raised the question about Skills England and—as the hon. Member for St Neots and Mid Cambridgeshire said—the powers are being taken not into a new independent body but directly into the Department. As my right hon. Friend the Member for East Hampshire said, it would be pretty extraordinary if the Ministers set their own standards for A-levels, so why do we think it would be okay in technical education? What is the Government’s game plan after the IfATE Bill? What is the plan to restore independent standards setting, rather than having it in what is only an agency of the Department?

I also want to ask a really specific question. This is a genuine question because I do not understand the decision. Why did the Department refuse to share the terms of reference for the short review of 16 to 19 qualifications with the wider world? I know that FE Week certainly put in a freedom of information request to get it, which is a pretty extraordinary thing to have to do. Normally, when there is a review, the terms of reference are published. That review is not a secret. We know what the Government are looking at—a known question about BTECs and what will happen. Why did the Government not publish it and will they now?

On one last structural question, my sympathies are entirely with the Minister and the Government as there is a big question here, and this is not a straightforward challenge. We have heard the case for BTECs from various Members—the hon. Member for Sutton and Cheam made a passionate case in favour of them. I should declare an interest as I worked on T-levels before they were called T-levels, when they were still called the Sainsbury routes. Lord Sainsbury, Gordon Brown, Nick Boles and others did a huge amount of work to bring them to that point in trying to rationalise this alphabet soup. T-levels are our best hope: they are a more demanding qualification, they have a higher level of funding and they use a lot more time in industry. They are a better qualification that is bringing parity of esteem and higher quality to the FE sector, and they are our big chance to rationalise this issue that everyone agrees is a problem. How far will the Government go towards replacing some of the existing qualifications, and what is their overall strategy and vision for how this will pan out?

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[Janet Daby]

Very smart and clever indeed—I will of course pass on that invitation to Stoke-on-Trent as well. We have also heard from the hon. Members for Broxbourne (Lewis Cocking), for Strangford (Jim Shannon) and for Mid Leicestershire (Mr Bedford)—it was great to hear about his brother’s achievements, so I thank him for that. There were contributions from my hon. Friends the Members for Hartlepool (Mr Brash) and for Stoke-on-Trent Central (Gareth Snell), the hon. Members for Westmorland and Lonsdale (Tim Farron), for St Neots and Mid Cambridgeshire (Ian Sollom) and for Wokingham (Clive Jones), and the shadow Minister—the hon. Member for Harborough, Oadby and Wigston (Neil O’Brien).

Members have spoken about many issues in this debate, such as greater diversity in the workforce, including both women in STEM and the representation of people from diverse backgrounds. Concerns have also been raised about BTECs, apprenticeships and T-levels—for example, the apprenticeship levy, the teaching of further education, the reform of qualifications, and colleges needing certainty in the future about specific courses. I hope to address as many of those and other remarks as time allows, including the points raised by the right hon. Member for East Hampshire.

It is this Government’s mission to drive and increase opportunity for young people across the country. Working with Skills England, it is also this Government’s mission to support employers to train people up and identify and develop the skills they need to grow, helping to kick-start economic growth. Early investment in young people pays off for employers. We want young people to be enthusiastic, energised and passionate about learning and developing in their work. That will benefit employers, industry and our wider economy, which will be galvanised by a new generation who are willing to work hard and progress in their careers.

It has been concerning in recent years that young people have seen their apprenticeship opportunities disappear. We ask ourselves, “Why is that?” It may be helpful to remind the shadow Minister that following apprenticeship reforms made by the previous Government, including the introduction of the apprenticeship levy in 2017, apprenticeship starts by young people under 25 fell by almost 40% according to the Department for Education’s published data. It is also concerning that so many workers and employers have told us that they find it difficult to access the skills they need. UK employers report that more than a third of UK vacancies in 2022 were due to skill shortages. That is what we have inherited.

According to a stark statement from the OECD, 26% of the UK workforce are underqualified for their job, compared with an OECD average of 18%. There are widespread skills shortages in areas such as construction, manufacturing and health and social care. We desperately need workers in those areas. That is why meeting the skills needs of the next decade is central to delivering our Government’s five missions, which, I remind everybody, are economic growth, opportunity for all, a stronger NHS, safer streets and clean energy.

This Government will create a clear, flexible, high-quality skills system with a culture of businesses valuing and investing in training that supports people of all ages and backgrounds, breaking down the barriers to opportunity and driving economic growth. We are bringing forward legislation to enable Skills England to work with key stakeholders. Skills England will make sure that we know where our skills gaps are to ensure that a comprehensive suite of apprenticeships, training and technical qualifications is aligned with those skills gaps and the needs of employers.

I have heard concerns that Skills England will not have the independence or authority it needs. I would like to dispel those concerns today: Skills England will have an independent board that will provide leadership and direction, as well as scrutiny to ensure that it operates effectively and within the agreed framework,

Growth and skills are essential. We have listened to employers, who have told us that the current apprenticeship system does not work. We must do more to support them in accessing the training they need to fill their skills gaps and spread opportunity. Our growth and skills offer will provide employers and learners with greater flexibility and choice and create routes into good, skilled jobs in growing industries aligned with our industrial strategy.

[Neil O’Brien]

Will the Minister give way?

[Janet Daby]

I am going to make progress, and then I will take some interventions if I can.

We are introducing new shorter-duration apprenticeships and foundation apprenticeships as a first key step towards greater flexibility that will benefit employers and, indeed, students. We recognise that some roles need less than 12 months’ training and employers are currently locked out of offering apprenticeships. We want to support sectors that make use of fixed-term contracts or have seasonal demands or specific recruitment timetables. We will engage with employers via Skills England and introduce that flexibility where the justification is clear. Our new work-based foundation apprenticeship will focus on ensuring that training is directed towards real vacancies. It will offer young people broad training with clear and seamless progression into other apprenticeships. Unlike the last Government, we will work closely with employers and providers. This Government will make sure we get it right.

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[Neil O’Brien]

The Minister talked about introducing flexibility where appropriate—it sounded like perhaps only in some sectors. Is it still the intention for all employers to be able to use 50% of their apprenticeship levy for things that are not apprenticeships?

[Janet Daby]

The area the shadow Minister mentioned is currently being reviewed. As that information comes out, I am sure we will make him aware of it.

To open up the growth and skills offer and to deliver opportunity where it is most needed, we will ask more employers to step forward and fund level 7 apprenticeships themselves, outside the apprenticeship budget. Of the 2.5 million workers in critical demand occupations, the vast majority—more than 80%—require qualifications lower than degree level, so it feels right that we focus our support on those at the start of their working lives, rather than those already towards the top of the ladder.

The Government believe that all young people should have access to high-quality training that meets their needs and provides them with opportunities to thrive. That is why we are committed to making a success of T-levels and extending the opportunity they provide to as many young people as possible. We have introduced three new T-levels this year, opening up more opportunity for young people in the areas of craft and design, media, broadcast and production, and animal care. It was great to see an overall pass rate this year of nearly 90% and to learn that 83% of T-level students who applied to higher education secured a place.

At the end of the last academic year, more than 30,000 young people had taken a T-level, and we want to ensure that many more have the opportunity to study them, but we know that some changes are needed if we want to make that a reality. That is why we are looking at the delivery of current T-levels to ensure that more young people are able to enrol and succeed in them. Our review of post-16 qualifications reforms will ensure that there is a range of high-quality qualifications at level 3, alongside T-levels and A-levels, to support the skills needs of employers and the needs of learners.

[Neil O’Brien]

Will the Government agree to publish the terms of reference of that review?

[Janet Daby]

I have heard the shadow Minister mention that already, and I believe he has already received a response. [Interruption.] No, the shadow Minister has already received a response.

[Neil O’Brien]

Is that a yes? Will the Minister—

[Janet Daby]

I am sorry—I have already answered.

Last month’s Budget saw a good settlement for further education and skills, including £300 million revenue funding for further education and £300 million capital investment to support colleges to maintain, improve and secure the suitability of their estates.

Each one of us here knows the importance of high-quality skills training for young people, and I am grateful for the considered contributions of everyone who has spoken. When we look at the statistics, it is clear that for too long, young people have been locked out of the opportunities that can benefit them most. The actions I have outlined today will give us a real sense of how to make a difference for learners and employers. That is at the heart of the Government’s mission to spread opportunity and drive economic growth across all parts of our country.

School Transport: Northumberland

Neil O'Brien Excerpts

Tuesday 12th November 2024 Westminster Hall

[Neil O'Brien (Harborough, Oadby and Wigston) (Con)]

It is a pleasure to serve with you chairing, Mrs Harris. I congratulate the hon. Member for Hexham (Joe Morris) on securing this hugely important debate. This is an important subject to talk about, and there have been really good contributions from multiple Members. I declare an interest in Northumberland, as it is where I got married, in Wooler near Rothbury, which has already been mentioned. I have a great appreciation for Northumberland as a county. If I am not in the constituencies of the hon. Members for Hexham or for North Northumberland (David Smith) in the summer, I am normally in the constituency of the hon. Member for Westmorland and Lonsdale (Tim Farron), so they are all places for which I have a lot of love.

I will recap the story a little. Last year, we announced an extra £500 million of funding for local government for adult and children’s social care, particularly to reduce the pressure on other areas of children’s services, such as home-to-school transport. It was part of our wider strategy for children’s social care reform and allocated to things such as expanding family help, targeted early intervention and all those things. It was part of a wider settlement for local government last year, which was another above-inflation settlement. Local government absolutely was squeezed in the coalition years, when we were clearing up the large deficit after the financial crisis, as the Institute for Fiscal Studies has pointed out, but funding per person in 2024-25 is set to be 10% higher in real terms per person than in 2019-20, with bigger increases for the most deprived councils. It is worth recognising that what happened over the last Parliament is not the same as what happened in the period 2010-2015, when there were real-terms increases per person for local government.

I mention that because the local government financial settlement for next year is now looming; I guess that we should expect it some time in the next month. Perhaps the Minister will tell us when it is coming. I have a couple of specific questions that I hope she will be able to answer, as they are relevant to this debate. What will the total cost to local government be of the national insurance increase announced in the Budget? What will the cost of the national insurance increase be specifically to home school transport? Will local authorities be compensated for those costs?

We know that one of the recurring issues with the national insurance increase is who will be compensated. Public services that are not part of the public sector are not included in the protection. For example, GPs are up in arms about the enormous bills that they all face, and there are similar issues for nurseries, which are extremely concerned. The university sector has already learned that the entirety of the increase paid for by the breaking of the tuition fees promise will pay for the breaking of the promise on national insurance, so one broken promise will pay for another. All the gains that it thought it was going to get from the tuition fees increase are being entirely wiped out and eaten up by the cost of the national insurance increase, so real-terms funding for universities will go down. Those issues very much apply to home-to-school transport, a public service provided by people outside the public sector. Will the Minister tell us whether they will be fully compensated for that? I hope she will be able to give us that assurance.

We have touched on some of the wider issues in which this issue is situated. The hon. Member for Westmorland and Lonsdale has mentioned this, but I was really sad to see the end of the “get around for £2” scheme, which we introduced and extended to the end of 2024. I know from my own community that it has particularly benefited people in rural areas, so I am sad to see that it has gone and there is effectively a 50% increase in the cost of a lot of journeys on buses. That is a real shame, because I felt we were making progress on buses. I was involved in the Bus Services Act 2017, which gave mayoral combined authorities the power to introduce into other areas of the country the kind of franchising that London has enjoyed for a long time.

It was sad to see the scrapping of the dualling of the A1 through Northumberland. Land and houses had been bought up to allow for the work, which makes it even worse. I was astonished to see that in the Budget, although there was lots of capital for other things, including the different things that the right hon. Member for Doncaster North (Ed Miliband) wants to do on net zero, there was an overall reduction in capital transport spending. I was really surprised by that. I do not really understand what the logic was.

[David Smith]

I have a simple question: would the hon. Gentleman agree that the last Government had 14 years to dual the A1 and did not manage to do so?

[Neil O'Brien]

We had finally got there. We had bought the land and the houses, and the thing was about to happen. Somehow, the new Government snatched defeat from the jaws of victory, which is desperately sad. We will have to agree to disagree on that.

We have talked a bit about SEND funding in the round. The high needs block spending grew 70% between 2018-19 and 2024-25, so we put a lot more money into it. Hon. Members might say that is still not enough, and I would totally understand where they are coming from, but the demand is exploding upwards. I know that the Minister will be thinking equally about the causes of that and what she can do about it—not just meeting the need, but trying to understand the root causes and reduce the need for these services. There was a very large increase in that high needs block SEND spending.

A couple of hon. Members mentioned that one of the ways to solve the issue is not to look at the transport but to look at the schools. This is a long-term obsession of mine. I had a Westminster Hall debate not so long ago about this very issue. Since 1980, the number of small schools with fewer than 200 pupils had roughly halved, from 11,464 to 5,406, by 2018. That is a long-term trend. Since 2000, rural schools—those in villages and hamlets—have been twice as likely to shut. When they have shut, the typical walk time to the nearest school has been about 52 minutes. That long-term trend, which has occurred under Governments of all three of the main parties, has posed all sorts of challenges for rural areas.

To try to arrest that trend, we brought in the lump sum within the national funding formula, which is about 60% of the total funding. It is a hugely important part of the funding and I look forward to hon. Members championing it. We must think about how we keep village and rural schools, which are such an important part of rural communities, going. That is not just because they make life simpler and the whole transport issue simpler, but because they are at the heart of rural communities. The hon. Member for Westmorland and Lonsdale talked about a 36% increase in taxis. We need to think about how we can attack the underlying causes of the need. I am sure that the Minister will be thinking about this.

I will end where I started by congratulating, in an honest way, the hon. Member for Hexham on securing this debate. It is hugely important. He made a super-important point about siblings being treated differently, which seems like absolute craziness. I am sure that we all agree that we ought to tackle that, but there are opportunities to address these issues, particularly through the local government funding formula. Government Ministers will stand up in a few weeks’ time and give us the numbers for how much local government is getting, but those in local government will want to know what is happening to their costs and for which of the services they provide, such as home-to-school transport, they will get compensation on the national insurance increase, because otherwise they will not know whether they are really ahead or behind.

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[Neil O’Brien]

I am grateful for the Minister’s answer. I am keen to understand whether local authorities will be compensated, not just for the direct costs to their own staff of the increased national insurance payments, but for the costs of services that they buy in, such as home-to-school transport. Will that also be fully compensated?

[Catherine McKinnell]

All those details are being worked through and will be announced in due course. I appreciate the hon. Member’s keenness to have advance sight of the statement—it is coming, and it will set out all of the detail.

In addition, local government in England is expected to receive about £1.1 billion of new funding in 2025-26 through the implementation of the extended producer responsibility for packaging scheme. Hon. Members might wonder what that has to do with transport, but it will shift the burden for managing household packaging waste from local authorities to the producers who supply and import the packaging. That will create additional revenue for local authorities to channel towards vital services such as public transport.

The Government are committed to reforming public services and the local government funding system, while providing as much certainty as possible. It is important that we deliver that reform in partnership with local government, and my ministerial colleagues will be setting out more detail shortly.

The Department routinely collects data on local authorities’ expenditure on home-to-school travel, and we understand the increasing financial pressures that they face. However, as things stand, the Government have not collected data on the actual travel being arranged, even fundamental information such as the number of pupils receiving free home-to-school travel, the transporting of siblings—as my hon. Friend the Member for Hexham highlighted—and information on catchment areas. I am determined, given the concerns that he and other hon. Members have raised, that we improve our data on the subject so that local authorities can benchmark themselves against similar authorities and learn from one another, and so that central and local government have the robust evidence to inform decision making on those issues. We will be writing to local authorities in the coming days, setting out our plans to ask them to provide data on travel that they arrange for children and young people to get to school and post-16 providers. It will be voluntary at first, but I hope local authorities will see the benefit of the data collection and share the requested data that they hold.

Another big issue that we know we must tackle is school absence. If children are not in school, they cannot benefit from their education. Thanks to the efforts of the sector, more children are in school in 2023-24 compared with the previous year, but 1.6 million children are still persistently absent, and that is a major challenge. We know that some children, particularly those with additional needs, face additional barriers to attendance, so we have to work to tackle those issues. We know that schools need to take a support-first approach and ensure that they have an attendance champion and policy and that they work with local authorities. Clearly, transport to school is a big part of that jigsaw.

Public transport clearly has an important role to play. Good local bus services are an essential part of thriving communities, providing access to education and other services. Outside of London, buses were deregulated in 1985. They now largely run on a commercial basis, and my hon. Friend the Member for North Northumberland pointed out some of the challenges that that can present. The Government have pledged to fix that, and the Bus Services Bill announced in the King’s Speech will put the power of local buses into the hands of local leaders. I know the North East Mayor Kim McGuinness is working to improve bus routes and has committed to repairing our broken bus system in the north-east.

I thank my hon. Friend the Member for Hexham again for bringing the matter forward and all those who have made contributions to the debate. It is an issue that many people rightly feel passionately about. I acknowledge the challenges that far too many families face when seeking to get the right support for their children. By fixing our broken SEND system, by transforming our education system so that more children can access an inclusive, high-quality education locally and by fixing our broken transport system, we can truly make this change.

Oral Answers to Questions

Neil O'Brien Excerpts

Monday 4th November 2024 Commons Chamber

[Mr Speaker]

I call the shadow Minister.

[Neil O'Brien (Harborough, Oadby and Wigston) (Con)]

On pay, what is the cost to schools and colleges of the national insurance increase? How much will be provided to them in compensation? Will the Secretary of State confirm clearly that they will be fully compensated for the increased prices that suppliers and indirectly employed members of staff, such as caterers and IT and premises staff, will charge as a result? Will those indirect costs be covered—yes or no?

[Bridget Phillipson]

I welcome the hon. Gentleman to his place. Schools and colleges will be compensated at a national level. I would, however, point out to him that when I became Secretary of State in July, I was presented with the teachers’ pay review body award of 5.5% that the last Government received, put in a drawer and then ran away from and called an election. We have backed our teachers, who are crucial to the life chances of our children. That is why I was delighted that we were able to honour that award and recognise the vital contribution our teachers make. That is how we will recruit 6,500 new expert teachers. If the Opposition refuse to back our commitments on VAT, they should set out how many teachers they intend to cut.

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[Mr Speaker]

I call the shadow Minister, Neil O’Brien.

[Neil O’Brien (Harborough, Oadby and Wigston) (Con)]

The sun always shines on Chorley, Mr Speaker. One thing that helps young people to gain skills is involvement in the cadets, but the Department recently confirmed a decision to cancel support payments to combined cadet forces in state schools. That payment was something that people involved in the cadets and teachers really valued. What assessment was made beforehand of the impact that this cut would have? Will the Secretary of State reconsider it?

[Janet Daby]

We respect all our young people who are in the cadets or any other armed forces areas. The hon. Gentleman raises this point, but after 14 years of the previous Government’s failure and the £22 billion black hole, there are difficult choices to be made. We are absolutely committed to children and young people and to doing the best we can do by them.

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[Bridget Phillipson]

I am sorry to disappoint the right hon. Lady, but we will be talking about the Conservatives’ 14 years of failure for a very long time indeed.

[Neil O'Brien (Harborough, Oadby and Wigston) (Con)]

rose—

[Bridget Phillipson]

Children across our country were failed by her party time and again, including the children with SEND we have heard about this afternoon—