Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [HL]

Lord Aberdare Excerpts

Committee stage
Thursday 21st November 2024 Grand Committee

[Lord Aberdare (CB)]

My Lords, I very much support the intention and aims underlying the Bill; namely, to create a new and more effective UK skills system, with Skills England at its heart, to replace the current system—if you can call it a system at all—which is complex, fragmented, lacking in clear measures of success, and failing to deliver the skills we need.

The King’s Speech spoke of a Skills England Bill and that promise is surely not met by a Bill which does not mention Skills England at all. It has required considerable ingenuity on the part of several noble Lords to produce amendments that do mention Skills England and are deemed to be in scope.

The Bill focuses entirely on abolishing IfATE and transferring its functions—not to Skills England but to the Secretary of State—but it says nothing about the role, status and powers of Skills England, to which presumably these functions will in due course be passed, nor, as other noble Lords have mentioned, about how Skills England will combine the essentially practical, administrative and awarding functions it inherits from IfATE with its much broader and important role of aligning the skills system with the aims of boosting growth and spreading opportunity.

I feel some sympathy for the amendments from the noble Baroness, Lady Barran, to remove Clauses 1 to 3 and their respective schedules, because they and other amendments address the fundamental issue of how Skills England is intended to work, how we are supposed to get there from here—I was interested in the point made by the noble Baroness about the interregnum—and what the transition plan is.

I would prefer Skills England to be a statutory body, with sufficient authority and independence to fulfil its vital mission across the numerous government departments and other bodies involved and to bring together the demand challenges that employers face with skills shortages and so forth, given that the education and training systems are not delivering the skills we need to meet that demand.

For those reasons, I have considerable sympathy for Amendment 21 in the names of the noble Lord, Lord Storey, and the noble Baroness, Lady Garden, and for Amendment 33 in the name of the noble Baroness, Lady Barran, which would ensure the establishment of Skills England, preferably as an arm’s-length body.

It is frustrating that there are so many key aspects of skills policy that we need to talk about, as well as the role of Skills England in delivering that policy—I welcome the principle—but the Bill doesn’t enable us to discuss those things. I therefore hope that the Minister will shed more light on how Skills England is expected to tackle the current mismatch between employer needs and education provision, including plans for the comprehensive strategy for post-16 skills promised in the manifesto.

[Lord Johnson of Marylebone (Con)]

My Lords, I want to speak to the amendments tabled by my noble friend Lady Barran, raising the issues that arise from the fact that Skills England, for all the hype, is to all intents and purposes the DfE. As others have mentioned, it will not have a statutory basis of its own. It might have a grand name and have been billed heavily in advance by the Government, but it is not a non-departmental public body which would be legally separate from the department and staffed by public servants rather than civil servants; it will be created by simple administrative action rather than legal instrument, meaning that it is basically just the department.

Executive agencies, of which Skills England will be one, are units of central government, perhaps administratively distinct to some extent but remaining legally very much part of it. What does this mean in practice? In some ways, it could be good. Potentially, it means a shorter feedback loop into Ministers’ red boxes, where responsibility for overarching skills policy rightly resides—there will be no room for excuses; the buck will stop with the Secretary of State for Skills England’s performance; and there will be no excuses for any failure of Skills England to work successfully across government departments and to corral Treasury to fund our skills system appropriately. However, that is the upside and, to be honest, I think there is potentially rather more downside from this change, because it is a misdiagnosis of where priorities need to be right now.

A prerequisite for a successful skills system is a reasonable degree of stability and certainty necessary to get businesses to invest in training, and there is no doubt in anyone’s mind that our businesses are not investing enough in training their workforce—as we all know, we are spending less than half the OECD average. Instead, we have near-permanent policy churn in this area. Supposedly once-in-a-generation reforms take place nearly every Parliament, sometimes every other year, creating chronic instability in the policy framework for investment for skills.

Now we have a massive machinery of government change with the abolition of IfATE, which was created less than seven years ago. Machinery of government changes are rarely worth the cost, disruption and distraction from other necessary priorities. This really is not what we should be debating right now. Machinery of government changes are no substitute for Ministers driving their teams hard, doing the difficult work of policy development and securing funding for skills from a very sceptical Treasury.

I am worried, therefore, that we are losing focus on the real issues. To my mind, there are two very big areas where I would prefer us all to focus our attention right now. The first is securing clarity from the Government on their plans for the defunding of applied general qualifications. I appreciate that there has been considerable movement from the Government on this matter since they took office in July, but further clarity is still needed on which qualifications that were due to be defunded next year will now be retained and when providers will get that vital information.

The second area I would prefer us to focus on is how we can end the confusion over the future of the lifelong learning entitlement, which has been delayed yet again in recent weeks and now will not start until sometime in 2027, and the provision by the Government of a clear statement as no one knows how the LLE will interact with their planned new growth and skills levy. These are two really important reforms and there is a desperate lack of clarity across our system on how they will work together. I would be very grateful if the Minister could help us with those two issues and take the opportunity to confirm that, in her mind, the LLE will still deliver the skills revolution that the last Government wanted from it and that Skills England will not quietly be asked to kill it off in the months to come.

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[Baroness Barran (Con)]

My Lords, I shall speak to Amendments 3, 4 and 7 in my name, and to Amendment 1 in the name of the noble Lord, Lord Blunkett—who I am delighted to see is well enough to join us today—and to which I have added my support.

As we have already heard, the Bill moves the powers from IfATE and transfers them to the Secretary of State while removing the requirement for external stakeholders to be consulted in all circumstances. The effect of this is to reduce independence regarding both the powers transferred and the examination processes—perhaps I should say “scrutiny processes” for the avoidance of doubt—as well as removing the requirement to work with those outside stakeholders which best understand the needs of their respective areas.

As also noted earlier in the debate, the Bill does not specify who will be consulted in reference to a group of persons. This lack of detail is concerning, and my amendments seek to rectify that. Amendment 3 in my name would include a list of relevant stakeholders which must be consulted before the creation of standards, which includes employers, mayoral combined authorities and sector representative bodies.

The spirit of the amendment is to retain the focus that IfATE had on employers and those with a strategic interest in technical education, whether that be regionally or by sector. They are all important to provide knowledge across a range of issues. Employers employ and train those who are undertaking apprenticeships and other qualifications and so can provide a perspective as to what business and the economy are in need of in relation to these qualifications. Mayoral combined authorities will be able to provide information as to what skills a particular region is lacking and advocate for a change in qualifications when necessary, and the local skills improvement partnerships will be able to provide their data as to what current, future and priority skills are in certain areas and expertise in how to increase collaboration between employers and regional authorities.

As noted by the Association of Colleges, there is a real opportunity here to bring together local plans, which sometimes exist in a vacuum, and a national plan, to encourage alignment and avoid duplication or gaps. Given that the Minister explicitly referred to this point at Second Reading, I hope that she will see the merit of my amendments.

The sector representative bodies will be able to provide knowledge on what skills and qualifications are relevant to the sector, both now and in the future, to ensure that these qualifications remain up to date and relevant to their economic needs. One of the central pillars of IfATE was its focus on employer and business needs to create and maintain suitable qualifications to equip people for the world of work. As such, we want to recognise the importance of keeping that focus to ensure that businesses can still trust the qualifications so that they continue to invest in the future generation of employees.

As mentioned at Second Reading, the Bill gives wide-ranging powers to the Secretary of State without maintaining those clear external links and the accountability that they help to provide. This is potentially damaging to the status of these qualifications. When in government, we delivered an increase in the value of skills-based qualifications, with a relentless focus on quality and developing a range of apprenticeships in particular that aim to reflect the breadth of our economy.

As such, we on these Benches want an effective approach to developing our apprenticeship and technical education system—I am sure that sentiment is echoed across the Committee—but I am concerned that the reduction in accountability and scrutiny in the creation of standards will not do that. That is why my Amendment 4 seeks to remove the Secretary of State’s power to act alone when creating standards. If the Government do not accept my Amendment 4, my Amendment 7 at least seeks to increase the transparency about when and how these powers will be used.

At Second Reading, the Minister was careful to set out some of the circumstances in which these powers to act alone would be used. She talked about making “small and fast adjustments” and allowing

“greater flexibility in scenarios where preparation by a group can be unnecessary or restrictive”.—[Official Report, 22/10/24; col. 581.]

Although it is unnecessary to have these powers, if the Government are so clear about these circumstances then surely it would be responsible to put them in the Bill so that the power of any future Government is constrained by the same things. I hope that, when she responds, the Minister will give the Committee some encouragement on this point. I also hope that she will reiterate the Government’s commitment to publishing standards in draft for stakeholder comment before they are finalised, and how the Government will respond if stakeholders have concerns.

As we heard, Amendment 1, in the name of the noble Lord, Lord Blunkett, to which I added my name, also seeks to bring the perspective of, and give greater responsibility to, sector representative bodies in the development of standards in future. This has much in common with my Amendment 3. The Minister will have views on the relative merits of “must” and “may”, but the spirit of the amendments is similar and aims to link the Government’s decisions as closely as possible to the real world. As the noble Lord, Lord Blunkett, put it so eloquently, it aims to ensure that we do not lose that focus on delivery.

We recognise the merits of Amendments 2, 5, 6 and 8, in the name of the noble Lord, Lord Aberdare. All of them drive broadly in the same direction—namely, to urge the Secretary of State to bring as much clarity as possible to the people she chooses to include in the group of persons referred to in Clauses 4 and 5, and to the circumstances in which she would exercise her powers in new subsection (3A) in Clause 4. The noble Lord’s Amendment 6 would give the Secretary of State more time to do so than my Amendment 7, but the aim of the amendments is similar.

[Lord Aberdare (CB)]

My Lords, I have a number of amendments in this group, which the noble Baroness kindly just introduced for me. Most of them are based on concerns expressed by employers that they should remain genuinely at the heart of the new system and that it will continue to meet their real needs. I have heard concerns from employers in the construction industry, CITB, the engineering services sector and the energy and utilities sector, for example, that the changes will possibly lead to less engagement of employers. To succeed in its aims, Skills England will need to foster close collaboration with employers of all types and sizes across all key sectors, including the eight growth-driving sectors identified in the industrial strategy.

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[Baroness Smith of Malvern (Lab)]

I will be delighted to, and I was coming to that.

Before I do that, I note the comments of the noble Baroness, Lady McGregor-Smith, and repeat from Second Reading my gratitude for her contribution to the development of IfATE. I recognise her point about what is necessary to get employer engagement in some of the detailed work that IfATE has been engaged in and that will be transferred under this legislation to Skills England. She is absolutely right about that; it needs consistent work. But it also needs, as employers have told us, appropriate flexibility and agility to enable those standards to be developed in a way that reflects changing developments and does not put too onerous a responsibility on employers in terms of their engagement.

Let us be clear that the default position will remain that a self-forming group of persons will prepare a standard. It is probably worth noting that this definition of “a group of persons” also legislatively guided IfATE in its engagement on occupational standards and apprenticeship assessment schemes. Our proposals do not weaken legislatively the engagement of employers. When a group does not convene itself to prepare a standard for an occupation which the Secretary of State is satisfied requires a standard, the Secretary of State may convene a group to prepare one. In both circumstances, we would expect that such a group would normally, but not exclusively, include employers that are representative of that occupation. Only when the Secretary of State is satisfied that it is more appropriate for them to prepare a standard than for a group of persons will the Secretary of State then do so.

To come to the noble Baroness’s point, scenarios in which it may be appropriate for the Secretary of State to use this power to prepare a standard are those where using a group would be disproportionately onerous for employers or other stakeholders; unnecessary because only minor adjustments or revisions were required; or where it could create undue delays. This might include—I say for illustrative purposes—updating standards to align with changes to mandatory qualifications within the standard; creating or updating standards to align with industry-recognised qualifications or statutory requirements; or creating or updating standards more efficiently where employers do not have the capacity. We envisage that the Secretary of State may also use the power to create and update standards for emerging or rapidly developing occupations, such as those in the digital sector. The clause also enables the Secretary of State to ensure that standards are developed or updated quickly to respond to acute skills needs or urgent regulatory changes required in an emergency, such as the updates to the level 3 community fire safety adviser following the Grenfell disaster.

Finally, employers themselves tell us that current processes for preparing standards can feel slow, bureaucratic and time-consuming. This is not a criticism of IfATE; it is a criticism of a requirement currently in legislation that we want to use this opportunity to make more flexible. It is a barrier to their engagement. We want to focus their input where it has the most impact.

[Lord Aberdare (CB)]

Those are all reasonable grounds for using the power, but there is nothing in the Bill that says that the default is a group of persons or that those are the kinds of circumstances in which the Secretary of State might take the power. There is nothing in the Bill that reassures employers that the powers would not be used unreasonably. There is nothing to stop them being used in any circumstances; nothing says that using a group would have to be disproportionately onerous, or indeed what the definition of “disproportionate” or “undue delays” is. In one sense, I am reassured, but in another, I do not see why there cannot be something in the Bill that lays it out a bit more clearly.

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Moved by

[Lord Aberdare]

9: Clause 5, page 2, line 24, at end insert—
“(6ZA) Within six months of the day on which the Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Act 2024 is passed, the Secretary of State must publish criteria for selecting membership of a group of persons described in subsection (6).”Member’s explanatory statement
This amendment, and a similar amendment to Clause 4, requires the Secretary of State to publish criteria for selecting members of a “group of persons”, which is not otherwise defined. The 2009 Act states that the “group of persons … must have been approved by the Institute”.

[Lord Aberdare (CB)]

My Lords, I have Amendments 9, 12, 13 and 15 in this group and have added my name to Amendments 10, 11 and 14 in the name of the noble Baroness, Lady Barran, with the same reservations about Amendment 10 as I expressed about Amendment 3. Your Lordships will be glad to know that I have failed to think of additional points that I have not already made in speaking to identical amendments to Clause 4, so I will content myself with saying that I beg to move Amendment 9, on the same grounds as set out previously.

[Baroness Barran (Con)]

My Lords, that is quite a challenge to follow, and it is tempting to take the same approach—I think my popularity with the Committee might improve—but, in all seriousness, as the noble Lord, Lord Aberdare, said, my Amendments 10, 11 and 14 are based on a very similar argument to that debated in the previous group about the concerning lack of detail regarding what we mean by “a group of persons” and the potential dilution of employer focus. With that, I commend the amendments.

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[Baroness Smith of Malvern (Lab)]

I thank noble Lords for their concise contributions on these amendments. As the noble Baroness, Lady Wolf, made clear, that does not undermine how important the nature of assessment is. I wholly agree with the noble Lord, Lord Addington, that the best chance of getting assessment right is by engaging appropriately at the right time.

On Clause 5, we are talking specifically about proposals regarding apprenticeship assessment plans and the transfer of the function from IfATE. Clause 5 amends the requirement for assessment plans to be prepared by a group of persons by making it subject to a power for the Secretary of State to prepare apprenticeship assessment plans if that is more appropriate. This will simplify the process for updating and creating assessment plans.

Noble Lords will recognise that our previous discussion also related to the use of groups of persons. We might find that some of the considerations are similar, but I assure the noble Lord, Lord Aberdare, that I will have a few different arguments in response to this, not least because the arguments for apprenticeship assessment are different to the arguments for standards. But the principle about agility and flexibility remains at the heart of this.

Where the intention behind Clause 4, which we have just discussed, is to provide the Secretary of State with greater flexibility in a minority of circumstances in respect of preparing occupational standards, here we are concerned with flexibility in respect of apprenticeship assessment plans. In both cases, our intention is for employers to have a continuing and vital role in the composition of groups of persons. In both cases, it is important, as I am setting out, for the Secretary of State to have some limited flexibility not to define the membership of the group in advance and not to have a group if it is not needed in a small number of cases.

The default position will be that an assessment plan will be prepared by a group of persons that has been approved for this purpose. Only when Skills England or the Secretary of State is satisfied that it is more appropriate for them to prepare an assessment plan, rather than a group of persons, will the Secretary of State do so. Scenarios in which it could be appropriate to consider the use of this power are where using a group would be disproportionate or create undue delay—I hear the point made by the noble Baroness, Lady McGregor-Smith, about the need for speed.

Scenarios could be, first, updating assessment plans to make adjustments that do not materially change the assessment or occupation competence of learners—for example, where they are aligned to deliver the competence required by a regulator, such as in regulated professions in the health sector. In such circumstances, using a group is unnecessary and burdensome because it is a reflection of updating that has happened in a regulated profession. The second scenario is creating assessment plans for emerging occupations, such as certain digital occupations. The third is creating or updating assessment plans where there are acute skills needs requiring an urgent response, and where there is a lack of capacity in the system to respond. Relying on a group in instances such as these can create undue delays and hinder responsiveness. Without this clause, changes to assessment plans to reflect straightforward adjustments would incur delays and require unnecessary time and resource.

I note Amendment 11 in the name of the noble Baroness, Lady Barran, which seeks to remove the power held by the Secretary of State to prepare an assessment plan if they are satisfied that it would be more appropriate for the plan to be prepared by them than by a group of persons. However, for the reasons I have outlined already, it is crucial that we respond to feedback from users of the system to make the process for developing apprenticeship assessment plans more agile.

Amendments 9 and 15 in the name of the noble Lord, Lord Aberdare, and Amendment 10 in the name of the noble Baroness, Lady Barran, seek to set criteria for membership of a group of persons and to name in legislation a particular type of person that must be included as part of a group of persons. In the discussions on Clause 4, we went through some of the arguments about the impact this would have in reducing flexibility. There are no existing statutory criteria for how a group is formed to prepare an apprenticeship assessment plan but, as I said previously, IfATE is under a duty to publish information about matters it will consider when deciding whether to approve groups of persons. That existing duty is being transferred to the Secretary of State unchanged.

When a group is convened, it is critical to consider who the experts are in the field in question. The noble Baroness, Lady Garden, correctly identified that the experts in assessment will not always be the same as the experts in developing an occupational standard—and, of course, this will vary from occupation to occupation. Employers play a prominent role and are well placed to define and describe occupational competence, but they do not always exclusively hold expertise about how apprenticeships are assessed, and other contributions may be valuable. It is important that there is the opportunity for groups of persons responsible for preparing apprenticeship assessment plans to reflect and draw on a broader range of expertise, such as in assessment methodologies, practical training delivery and costs.

Professional bodies, awarding organisations, providers, regulators and others with a background in assessment can be well placed to be involved in the development of an assessment plan. In new and emerging occupations or highly specialised occupations, such as digital, artificial intelligence and nuclear, it may be necessary to take a broad and creative look at who is best placed to be part of a group preparing an assessment plan. There are scenarios where it is unnecessary or disproportionate to rely on a group to create or update assessment plans. For example, attempts have been made to convene a suitable group to update the interior systems installer assessment plan for nearly a year. This has significantly delayed the commencement of necessary, time-sensitive revisions in the important construction and built environment industry—a sector that is critical to this economy.

Setting criteria would therefore create additional hurdles for, and potentially even prevent, groups being convened. This would further slow the development of assessment plans and risk employers and others losing confidence in the system and in our ability to meet acute skills needs. It is not in anyone’s interest, not least learners or employers, to incur such delays. That is why we are removing unnecessary barriers to simplify and speed up processes.

Amendment 12 in the name of the noble Lord, Lord Aberdare, would undo the intended flexibility and efficiency by placing a requirement on the Secretary of State to consult specific bodies when they have considered it more appropriate for them to prepare an assessment plan than to use a group. That also risks slowing progress when that body is unable to participate, and it risks giving unintended precedence to those bodies over others who may be well placed to determine how competence should be tested.

I should also note that we see no reason why Skills England would not continue the approach currently taken by IfATE whereby all new assessment plans and those that have undergone material revisions—whether prepared by a group of persons or the Secretary of State—are published online for comment by any interested parties before approval.

Amendment 14, in the name of the noble Baroness, Lady Barran, and Amendment 13, in the name of the noble Lord, Lord Aberdare, would establish a duty to set and publish criteria in relation to the preparation of an apprenticeship assessment plan by the Secretary of State. As I emphasised, we are improving the system in response to feedback from key partners. Employers, trade bodies and providers tell us that the processes for developing and reviewing assessment plans need more pace and agility to respond quickly to changing and future skills needs. They report that current processes can feel bureaucratic, drawn out and time consuming—all barriers to the expert engagement that we need from them and to the smooth operation of assessment for employers and learners.

Setting criteria that the Secretary of State would need to meet in order to prepare assessment plans—in the minority of circumstances when it is more appropriate to do so than using a group of persons—would restrict the Secretary of State’s ability to be responsive. It would be overly prescriptive and fly in the face of stakeholders telling us that processes need to be simpler. I hope I have set out the intentions behind Clause 5 and, for the reasons I have outlined, I hope that the noble Lord, Lord Aberdare, will feel able to withdraw his amendment.

[Lord Aberdare (CB)]

My Lords, I thank all noble Lords who have taken part on this group, particularly my noble friend Lady Wolf and the noble Baroness, Lady McGregor-Smith, who added some valuable points. I thank the Minister, who mostly but not entirely managed not to give me the impression that I had wandered into a Groundhog Day scenario—there were some additional points there, I was glad to see.

The Minister emphasised agility and flexibility as the advantages of the proposed system. This is probably something wrong with me, but I have an inherent unease about flexibility in the hands of Secretaries of State when compared with flexibility in the hands of an organisation with an independent statutory role. The noble Baroness, Lady McGregor-Smith, mentioned that agility might not be quite such a feature once it gets into the hands of the department. Also, there is a slight conflict with the point that my noble friend Lord Hampton made earlier: employers are looking for clarity, and there is a slight danger of clarity being obscured by too much flexibility. Of course, all these concerns reflect points raised with me and, no doubt, with others by employers about the way the new system might work in comparison with the existing one.

Having said all that, I will study all the contributions, including the detailed differences from the previous set of amendments. Meanwhile, I beg leave to withdraw the amendment.

Amendment 9 withdrawn.

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[Lord Aberdare (CB)]

My Lords, I added my name to this stand part notice. My original thought was to table an amendment requiring the Secretary of State to publish regular reports detailing which technical education qualifications or standards and assessment plans had been approved without any review and why such review was deemed unnecessary. I was also concerned that the clause, as it stands, would seem to make it possible for no review at all to be conducted. The clause stand part notice in the name of the noble Lord, Lord Hampton, is more straightforward: it removes the clause altogether. I look forward to hearing from the Minister what exactly the Government’s intentions are for carrying out reviews and why these should not be spelled out in the Bill.

Similarly, although no amendment has been tabled, Clause 7 would make it possible for no third-party examination of a standard or apprenticeship assessment plan to be undertaken at all. Again, I hope that the Minister will tell us what the Government mean to do about such independent examinations. It has been suggested to me that they might be even more valuable sometime after a standard or a plan has been approved and put into practice, rather than before the approval, when it is not known what the effect will be.

[Baroness Garden of Frognal (LD)]

My Lords, there is no mention of awarding bodies in the Bill but, when I worked for City & Guilds, it was part of our role to review qualifications at regular intervals. I wonder why that does not feature anywhere in the Bill and why the Secretary of State is apparently taking over a function that was done very effectively in those days by awarding bodies.