Technical and Further Education Bill

Lord Nash Excerpts

Committee: 2nd sitting (Hansard): House of Lords
Monday 27th February 2017 Grand Committee

[Lord Knight of Weymouth (Lab)]

My Lords, I shall speak briefly in support of this amendment. I want to remind your Lordships and the Minister that FE colleges come in a number of different guises and there are some specialist FE colleges for which this is particularly important. I am particularly a fan of the Ada Lovelace College—the newest college, I think, to be given FE status by the department—which is the National College for Digital Skills, based in Haringey. We have an acute shortage of digital skills throughout this country, including here in London, and there is a massive demand for them. If we can allow more international students to come and take advantage of studying at that college, we would do our economy and some of those young people an enormous service. I urge the Minister to listen carefully, as is his wont, and to be sympathetic to this amendment.

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

My Lords, the Committee will be aware that this issue is already being considered as part of the Higher Education and Research Bill. As a Government, we will want to consider our position across the board, and I can assure noble Lords that we are doing this. This topic is best discussed in the context of the Higher Education and Research Bill, where there will be ample opportunity to consider the issue during the forthcoming Report stage. However, I will briefly address the more specific points of the amendment.

While there are some further education colleges that have centres of expertise or offer higher level study that attract a significant number of international students, such as the one referred to by the noble Lord, Lord Knight, as a whole the number of international students in FE is much smaller than for the higher education sector. Courses are on average shorter, and delivery is more locally focused and reflects local economic priorities. Where colleges take significant numbers of international students, the issues will parallel those that have been considered through proposed amendments to the Higher Education and Research Bill.

I do not propose to repeat the arguments that my noble friend Lord Younger of Leckie made during that debate. I do wish to emphasise that we have and will continue to set no limit on the number of genuine international students who can come here. The controls in place are there to prevent abuse of the system and ensure that the reputation of the UK educational sector continues to be internationally renowned. The immigration statistics are controlled independently by the Office for National Statistics. It is not up to the Government to create the statistical definitions. Our responsibility is to set the policy, which in this case places no limit on numbers of students.

As I have said, there will be an opportunity to debate these issues further as part of the Higher Education and Research Bill, which is the more appropriate forum. In those circumstances, I hope that the noble Lord will withdraw the amendment.

[Lord Watson of Invergowrie]

I thank the two noble Lords who contributed to the debate and the Minister for his response. I agree with the noble Baroness, Lady Garden, about the positive message that this sends. That is what I was trying to get across in moving this amendment.

Equally, I accept the Minister’s use of the term “abuse of the system”. No one would be tolerant of that at all. There were such situations in the past in the case particularly of language schools. Some of them had been—to use about the kindest adjective that could be applied to them—“bogus”. Very largely, these have been driven out of the system. I would not say that there is no abuse, but there is not a great deal. Opening up the further education sector does not necessarily increase the likelihood of such abuse.

I take the Minister’s point that the Higher Education and Research Bill is the place to deal with that. Fortunately for him, he will not have to do that, but I will be returning to these subjects next week. I wanted to draw attention to the fact that, hopefully, the further education sector has the opportunity to broaden its scope a bit. Whereas local provision is what it is mainly about, there is scope to expand that and I hope that the sector will take the opportunity to do so and will not be prevented from doing so through the inability to bring students in from abroad.

With those remarks, I beg leave to withdraw this amendment.

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These sorts of things lie behind the amendment of the noble Lord, Lord Hunt. This side of the Committee is trying very hard to persuade the Government to adopt these amendments, because we are all desperately keen that this apprenticeship system should work. We are very keen to get to 3 million apprenticeships, if we can. We do not think we are taking seriously enough the role of enforcement, and which organisations are doing it.

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

I am grateful to the noble Lords, Lord Watson of Invergowrie and Lord Hunt, for this amendment. I could not help but notice that the moment the noble Baroness, Lady Donaghy, made the very inappropriate comparison with Superman that I appeared, according to the annunciator anyway, to be in two places at once, as was pointed out to me by the noble Lord, Lord Watson of Invergowrie. I am not sure that even Superman managed that, but at least I am back now.

It is essential that all the public organisations that have a role in the delivery of apprenticeships and technical education, as elucidated by the noble Lord, Lord Hunt, work together to ensure a coherent system which delivers a high-quality result.

The noble Lord asked the perfectly fair question, “Who is in charge?”. The Government will work to ensure that the system works and will keep this under review via the accountability statement, which we will share with noble Lords.

The noble Lord asked what the Minister’s role in this was. I guess, if the system does not work, Ministers will intervene to change the system, but individual bodies are responsible for their individual part of the system. The strategic guidance document will ask the institute to carry out a leadership role—a co-ordination role—across the system.

In response to the point made by the noble Lord, Lord Storey, on quality versus quantity, I repeat a point I made on the first day of Committee that our target is 3 million. We believe it is a realistic target, but quality must come first.

Paragraph 10(1)(b) of Schedule A1 to the Apprenticeships, Skills, Children and Learning Act 2009, which will be inserted into that Act by the Enterprise Act 2016, will allow the Institute for Apprenticeships to co-operate with any organisation that it deems necessary for it to carry out its specific functions. It is therefore unnecessary to include the requirement in the Bill.

The Bill includes a data-sharing provision to allow the named organisations freely to share data and information between them, to ensure that they can all deliver their functions properly. This, in addition to the legislation referred to above, is all that is needed in primary legislation to allow those bodies to work together.

In addition, the amendment would require the institute to co-operate with the named organisations but, without a similar requirement on them in return, the effect would be unbalanced. However, that is not my main point.

It is in the interests of all of the organisations named in this amendment to work well together to enable them to fulfil their statutory duties. Past experience demonstrates such a willingness. As the legislation will permit this, we see no need for a further requirement. In preparation for the launch of the institute in April this year, these organisations and others are working together to agree an accountability statement which sets out each of their separate roles and responsibilities in relation to apprenticeships. There is a very positive working relationship between them and a palpable desire to ensure the institute is a real success.

In answer to the point made by the noble Lord, Lord Young of Norwood Green, about how Ofsted will carry out its risk assessment approach, I am meeting Ofsted later this week and will discuss this with it in some detail and write to the noble Lord and copy my letter to other interested Peers. I hope that the noble Lord will feel reassured enough by what I have said to withdraw the amendment.

[Lord Hunt of Kings Heath]

My Lords, I am grateful to the Minister. We always thought that he had super powers and are glad to have confirmation of it. This debate has been helpful.

The Minister has promised an accountability statement and it would be helpful to have that before Report. He said that Ministers will intervene and, importantly, that the institute will have a leadership and co-ordinating role. One question is whether it would be helpful to have that backed up by some legislative provision to reinforce it, which is perhaps something that we can come back to.

On the question of the 3 million and quality, I hear what the Minister says. I take his point that 3 million is deliverable but that quality comes first. The question I would like to ask him is whether the Treasury and No. 10 Downing Street share that view. My experience is that, when push comes to shove, the key indicator on which his department will be held accountable will be the 3 million, rather than the quality indicator. Essentially, we are trying to give some cover to the Government to say that at the bottom line quality is more important than the numbers.

I take the point about the drafting of the amendment —that the duty should have been reciprocal—and we can probably come back to it, but this has been a very helpful short debate. I beg leave to withdraw my amendment.

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[Lord Nash]

My Lords, I am grateful to the noble Lords, Lord Watson and Lord Hunt, for their two amendments relating to issues of representation for the Institute for Apprenticeships.

With regard to Amendment 16, the institute should obviously understand the views of those people undertaking this training to ensure that it is meeting their needs, because it is the organisation responsible for apprenticeships and technical education. Section ZA2 of the 2009 Act, inserted by the Enterprise Act 2016, already requires the institute to have regard to,

“the reasonable requirements of persons who may wish to undertake education and training within”,

the institute’s remit, and to other interested persons. The institute is also required to engage interested groups as part of the review of standards and assessment plans.

The institute has purposely been established as an independent organisation, with high-level responsibilities set out in legislation but with the freedom to decide how it delivers them. It is essential for the credibility of apprenticeships and the wider apprenticeship reform programme that the institute retains as much autonomy as possible. Government can provide the institute with advice and guidance about how it could carry out its functions. It has to have regard to this advice and must provide justification if it chooses not to follow it. The Government recently consulted on a draft of their guidance to the institute for 2017-18, which includes a request for the institute to establish an apprenticeship panel to advise the board. The shadow institute has already committed to doing this by the time that it is launched and good progress is being made. Members for the first apprenticeship panel have already been shortlisted and an initial meeting is planned for March.

[Lord Watson of Invergowrie]

On that point, can the Minister say how this was done? Were applications invited?

[Lord Nash]

I will have to write to the noble Lord about that.

As well as advising the board, the first panel will decide how the panel will be run, including how future members will be recruited. The proposal is for the institute to take on responsibility for technical education from April 2018. I can confirm that it would be our intention to include a request in its guidance for 2018-19 for a panel to represent those undertaking technical education.

Amendment 18 would stipulate the make-up of the group of persons whom the institute could approve to develop a standard. In particular, it would require that the group includes a range of employers and at least one provider. I agree that it is essential that the standards that form the basis of reformed apprenticeships and new technical education qualifications are of high quality, and meet the needs of a wide range of employers and learners, but I am not convinced that this amendment is necessary. I have already explained that the institute needs to be independent from government to be able to undertake its functions with credibility. It will be well placed to make decisions about who can develop a new standard, based on a range of factors, and it is right that it should be given the flexibility to do so without the constraints that this amendment would impose.

However, in my remarks on the preceding amendment I referred to the strategic guidance providing a vehicle for government to advise the institute. The current draft of the guidance includes the recommendation on who should be able to develop standards and makes it clear that we will expect the institute to continue to ensure that standards are developed primarily by employers, but with input from others with the relevant knowledge and experience, such as professional bodies, other sector experts, providers and assessment organisations. If the institute decides not to follow the government guidance it must give reasons in its annual report, but it is crucial that, as an expert, independent organisation, it retains the ability to make decisions itself about delivery, taking into account all the relevant circumstances. We believe that our approach strikes the right balance. I hope that, on the basis of my explanation, the noble Lord will feel reassured enough to withdraw this amendment.

I thank the noble Baroness, Lady Wolf, for her Amendment 36A. I am sure it was prompted by concerns for publicly funded learners who may find themselves without a place to complete their course in the event that an independent provider shuts down. I share her concerns but just as with FE bodies, the likelihood of independent training providers becoming insolvent is low. The Skills Funding Agency has a robust entry process in place to ensure providers are capable of delivering a high-quality learning offer to loans learners. Once providers have met the entry criteria and are eligible to offer loans-funded provision to learners they are subject to a range of further measures and controls, including review of their financial health, audit, and assessment of their qualification achievement rates. Providers are also required to comply with robust funding and performance rules. A small handful of providers is facing difficulty, but the numbers affected by these cases represent less than 1% of providers operating in the advanced learner loans programme.

[Baroness Wolf of Dulwich]

If it is not necessary to have protection because not very many people get affected, why is it necessary to have it for further education colleges, which also do not fail very often?

[Lord Nash]

I will come to that in my explanation. These are private companies and it is not our role to interfere. I will elaborate in a moment.

In cases where independent providers delivering publicly funded training courses have closed down, our first priority is to support any publicly funded learners affected, ensuring they can continue their courses with minimal disruption. The SFA works closely with the SLC to ensure that, wherever possible, we identify a suitable alternative training provider or college where individuals can complete their learning. We have been doing just that in a recent case, which received a certain amount of publicity, when a provider went into liquidation in November: we have matched all the learners to alternative provision.

However, these are private companies, and it is not for the Government to involve themselves in their financial matters any more than those of other private companies. This is, essentially, the point I made in answer to the noble Baroness. We will always work to support learners affected in cases where the provider fails and it is right that we do so, in the way I have outlined. But as to whether we should have a special administration regime, we cannot make the same special and complex arrangements, which will often involve significant and additional public funding, where a private company has failed. This is, and must remain, a matter for the company and its creditors and shareholders. I hope the noble Baroness will agree, and will therefore not press her amendment.

[Lord Young of Norwood Green]

I asked how they are subject to scrutiny and accountability for the quality of service they are providing, never mind the financial side. I gave the Minister an example where I thought they would. I take the point made by the noble Lord, Lord Storey, that there are some good examples of training providers, but who scrutinises the quality of service they are actually providing? That was what I wanted to know.

[Lord Nash]

It is Ofsted.

[Baroness Wolf of Dulwich]

I am happy not to press my amendment, but I would like some clarification on why a private company which is often entirely dependent on public funding should be in some sense exempt from any requirements. This does not seem to be consistent with much of what goes on elsewhere in the public sector and what it requires of people.

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Moved by

[Lord Nash]

33: Schedule 1, page 28, line 37, leave out from beginning to end of line 13 on page 29 and insert—
““40AA Sharing of information by or with the Institute(1) The Institute for Apprenticeships and Technical Education may disclose information to a relevant person for the purpose of a relevant function of that person.(2) For disclosure of information by the Institute for the purposes of its own functions, see paragraph 10 of Schedule A1.(3) A relevant person may disclose information to the Institute for the purpose of—(a) a function of the Institute, or(b) a relevant function of that person.(4) In this section “relevant person” means—(a) Ofqual,(b) the OfS,(c) Ofsted, or(d) a prescribed person.(5) In this section “relevant function” means—(a) in relation to Ofqual, the OfS or Ofsted, a function of that body, so far as the function relates to England;(b) in relation to a prescribed person, a prescribed function of that person, so far as the function relates to England.(6) In this section—“Ofqual” means the Office of Qualifications and Examinations Regulation;“OfS” means the Office for Students;“Ofsted” means—(a) the Office for Standards in Education, Children’s Services and Skills, and (b) Her Majesty’s Chief Inspector of Education, Children’s Services and Skills.(7) Regulations under this section prescribing functions of a person may prescribe all of the person’s functions.”

[Lord Nash]

My Lords, these government amendments will allow the Secretary of State to make sure that the data-sharing gateway in new Section 40AA remains fit for purpose through regulations. The regulations can include persons to whom the institute can disclose information or who can disclose information to the institute, and the functions about which the information may be disclosed. New Section 40AA will establish data-sharing gateways between the institute and Ofsted, Ofqual, the Office for Students or any other person set out in the regulations. There is already a separate provision for the institute to share information in relation to its own functions.

The bodies with which the institute is likely to need to co-operate and share information to do its job effectively are expected to change over time. That is particularly important given the reforms in higher and technical education. For example, the Quality Assurance Agency will not be named specifically in legislation and the quality arrangements in that area may change over time. It will be important to ensure that the institute can work effectively with whatever body is designated in that case, as well as any other bodies which take on roles in relation to education and training. All the disclosures under the gateways take precedence over any non-statutory restrictions, but they would be subject to all the important safeguards in the Data Protection Act 1998.

I reassure noble Lords that I am, however, absolutely mindful of the need to ensure full parliamentary scrutiny each time the Section 40AA power is used. Although not common in relation to similar regulations, where the negative procedure will be used, it is proposed that these regulations will be subject to the affirmative procedure. In view of this, I hope that noble Lords will accept this amendment.

[Lord Lucas]

Will the DfE be able to access this data, for instance to try to understand what history at school leads to what sort of performance in technical qualifications and apprenticeships?

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[Lord Nash]

If I may answer my noble friend Lord Lucas’s point, the answer is yes under a separate provision in the Bill. On the point about the difference between relevant and prescribed, a prescribed person is somebody set out in regulations and a relevant person is set out in the Bill or in regulations.

Amendment 33 agreed.

Moved by

[Lord Nash]

34: Schedule 1, page 29, line 13, at end insert—
“27A In section 40D(3)(interpretation of Part 1A)—(a) the words from “affects” to the end become paragraph (a);(b) after that paragraph insert— “(b) authorises the disclosure of any information in contravention of any provision made by or under any Act which prevents disclosure of the information.””

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Moved by

[Lord Nash]

35: Schedule 1, page 29, line 33, at end insert—
“29A In section 262(6)(orders and regulations subject to affirmative procedure), after paragraph (aa) insert—“(aza) regulations under section 40AA;”.”

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Moved by

[Lord Nash]

36: After Clause 6, insert the following new Clause—
“Records etc
(1) The Secretary of State may by regulations make provision for or in connection with—(a) the delivery to the registrar of companies of documents that relate to the insolvency of further education bodies;(b) the registrar’s function of keeping records of information contained in such documents under section 1080(1) of the Companies Act 2006;(c) the publication of, or access to, those records or related information.(2) The regulations may, in particular, provide for any provision made by or under the following sections of the Companies Act 2006 to apply (with or without modifications) in relation to those documents or records.

Provision of Companies Act 2006	Description
sections 29 and 30	copies of resolutions etc to be forwarded to the registrar
section 859K	registration of enforcement of security
sections 1077 and 1079	public notice of receipt of certain documents
sections 1081, 1084 and 1085 to 1091	keeping and inspection of register of companies
sections 1093 to 1097	correction or removal of material on companies register
section 1104	documents relating to Welsh companies
sections 1112 to 1113	supplementary provisions

(3) The power under subsection (1) includes power—(a) to impose requirements on a person who delivers a document to the registrar in relation to the insolvency of a further education body to provide supplementary information;(b) to confer power on the registrar to make rules in accordance with section 1117 of the Companies Act 2006 imposing such requirements.(4) Provision made under this section is in addition to any applicable provision made by Part 35 of the Companies Act 2006 or elsewhere. (5) Regulations under this section are subject to the affirmative resolution procedure.(6) Section 1114(1) of the Companies Act 2006 (meaning of document etc) applies for the purposes of this section.”

[Lord Nash]

My Lords, we have tabled this amendment to ensure that should an FE body become insolvent, there will be an accessible public record of documents relevant to the insolvency procedure for that body. FE bodies that are statutory corporations are exempt charities and not companies. As such, they are not subject to filing requirements with any particular regulatory body, although they are required to keep audited accounts and to publish them, for example on their websites.

When the Bill was originally drafted, it was thought that we could rely upon certain provisions of the Companies Act 2006 so that an insolvency practitioner could file documents required by the court as part of any insolvency procedure, including education administration. However, it is now clear that specific provision is needed within the Bill to ensure that an accessible and workable file for insolvent FE bodies may be created and managed by the registrar. This amendment therefore creates a new clause to provide for exactly that and allows the Secretary of State to make regulations relating to the delivery of documents about the insolvency of FE bodies to the registrar, about the registrar’s function of keeping records of information within those documents and about the publication of and public access to such records or information.

The power in the new clause also allows the Secretary of State to permit the Registrar of Companies to make rules relating to filing requirements, such as about the form of documents to be filed. As I hope the Committee will appreciate, this amendment is necessary to permit the paperwork of an insolvency procedure for an FE body to be properly managed. I beg to move that this amendment be accepted and that the new clause stand part of the Bill.

Amendment 36 agreed.