Technical and Further Education Bill

Lord Storey Excerpts

2nd reading (Hansard): House of Lords
Wednesday 1st February 2017 Lords Chamber

[Lord Storey (LD)]

My Lords, I welcome this thin Bill. I have always been concerned about how we regard technical and vocational education in this country; we are obsessed with young people having to fulfil an academic route. It is almost akin to failure if you do not succeed academically. I am not keen on the word “vocational”, and I do not think parents understand what it means. It is like saying, “I am doing it for love, not money”. Teaching was a vocation. I am pleased that the word is not being used.

If we are to develop a country which provides first-class skills, we need to enhance the status of technical education. Like the noble Lord, Lord Watson, I reflected—a word that was apparently much in use during the Higher Education and Research Bill—that we had 69 speakers at Second Reading for that Bill, while for the Technical and Further Education Bill we have 20. Does that not say something about our regard for this subject?

The Secretary of State said at Second Reading—this is important—that,

“half—last year, most—of our young people, often those from disadvantaged backgrounds will choose not to go to university, but to follow a less purely less academic route, or perhaps one that plays to individual strengths, talents and interests”.—[Official Report, 14/11/16; col. 41.]

The key to all this is not only providing a first-class academic, technical or further education but ensuring that young people know what the routes are, what they can do and what careers they might choose. Mike Tomlinson said at a recent Edge Foundation meeting on the EBacc that careers education is at best “pretty b….. awful”, and he is absolutely right. We pretend that we do careers education, but we do not: “There is a cupboard with some books in”, “Here is the latest government initiative”, and “here is what work we might do”. These are young people whose futures are in our hands so we have a responsibility to make sure that first-class technical education is available to them. If we want technical and further education to work, we must have effective careers guidance.

I understand that the Government are shortly going to announce their strategy. That is good, but any strategy, policy or provision is effective only if there is some regulatory support behind it, whether that is through Ofsted inspections, accreditation or a kitemark; nothing less will do. My own view is that a school, whether it is an academy, a maintained or a free school, should be described as “outstanding” or “good” only if its careers education is up to scratch.

The other problem we face with careers education is financial. The head teachers of maintained schools, academies and free schools are anxious to hold on to their students. They want them to move on into the sixth form because they are each worth a sum of money. They do not want them to go off to one of the UTCs of the noble Lord, Lord Baker, or an FE college because they will then be lost. Even if students are struggling academically the cry is, “Keep them in the sixth form. Let them repeat a subject and try again”. That is no way to deal with young people. We need to think outside the box about this. Why, for example, cannot UTCs and FE colleges have the right to go into schools and show students what is on offer? If schools are not prepared to do this in terms of careers advice, the colleges and UTCs should do it themselves.

Some people have referred to this legislation rather sarcastically as the “insolvency Bill”. I do not particularly go along with that, but there are issues with insolvency, some of which we will no doubt come to in various amendments. Again as the noble Lord, Lord Watson, has just said, if, God forbid, an establishment becomes insolvent, we need to make sure that protections are in place in terms of the real estate and the property, as well as for students and for courses. If a student in Northumberland is travelling 20 or 30 miles to their further education college—there is in this an issue about transport costs, and so on—and the course suddenly stops because of insolvency, what is the student to do, for goodness’ sake? We need to make sure that students and courses are supported and protected. Some colleges are already having difficulties regarding the banks’ willingness to lend to them and pension funds tightening their regulations because they are worried, so we need to make sure that those issues are addressed.

The noble Baroness, Lady Wolf, said in her excellent report, Review of Vocational Education, that at least 350,000 young people have been let down by courses which have,

“little or no labour market value”.

Young people are taking courses that are of little or no value in the labour market. I can remember when we got objective 1 funding in my own city of Liverpool. We filled the FE colleges with courses that were not relevant to our skills needs, such as hairdressing and beautician work. Both were fantastic, but actually they did not help the economy of the city one iota. However, the college was able to attract students because for some reason there was a certain cachet about taking a hairdressing or beautician’s course. As the Wolf report says, we need to make sure that the courses on offer are relevant.

We welcome the Institute for Apprenticeships and Technical Education and we are delighted that the Government have listened and included FE in the institute’s role. I had not realised, and was quite surprised to learn, that we have already announced the membership of the institute. I thought we would have had to wait for the Bill to pass. I am not sure how this happens. I am delighted that we have included two people from further education.

That is good news. The Minister looks puzzled, but I was told this by someone this morning. The noble Lord, Lord Hunt, indicates that I am right. Although I might be puzzled as to why this has been set up ahead of the Bill, I do not mind because we have included two people from the further education sector. That is good. I hope that that same principle will apply to the implementation routes and that we will include the FE sector in those as well. We need to understand how bridging between routes will be achieved. No doubt we will also want to understand in Committee how the transition year will work in practice, and where work experience might fit into this.

We constantly talk about social mobility—rightly so. We have talked about our world-class education system. Our Prime Minister has talked about a country that works for everyone. If a student goes into higher education between the ages of 18 and 21, their family gets tax credits. They get free prescriptions, free dental care, free eye tests, et cetera. When a young person— often from a disadvantaged background—takes an apprenticeship, which will of course include an element of training so in a sense they are still learning, the family loses out on tax credits. That is often a major disincentive for young people, particularly those from deprived backgrounds, to take up the apprenticeship. I hope the Minister will look at how we can support those families. We are talking about people we really want to attract. We want to get them on the road to employment.

The needs of the Cornish economy are different from those of Liverpool’s, so I welcome the fact that we are devolving some of the authority to a local level. Part 3 includes a measure to amend existing legislation to ensure that we devolve further education functions and adult education budgets to the combined authorities, if and when they are established. But as the National Audit Office reported, there is a growing financial crisis in further education. Indeed, it was its report that recommended the creation of an insolvency regime. We need another “I”—investment.

Another issue that we will explore in Committee is that if a young person is training on the job—doing their apprenticeships and getting their training at the same time, at their place of work—we need to ensure the quality of the training provided. From speaking to the Government about that, we have been told that Ofsted will probably do sample inspections. We need to be careful that this is absolutely right.

To conclude, I quote again the Secretary of State for Education, who said at Commons Second Reading:

“The Government want to build on what exists in the further and technical education sector and steadily create a gold standard of technical education … that students can be confident that … they will be building towards a successful career”.—[Official Report, Commons, 14/11/16; col. 43.]


I think we all say “Hear, hear” to that, but it requires the Government to listen and to commitment the resources.

Technical and Further Education Bill

Lord Storey Excerpts

Committee: 1st sitting (Hansard): House of Lords
Wednesday 22nd February 2017 Grand Committee

On the implementation of this clause, it is important that noble Lords should note that the Government will be publishing statutory guidance to which schools must have regard. This is a strong incentive and schools will have to follow what the Government have decreed. That guidance will be published when the Bill has gone through its final stages. The Government will work with Ofsted to monitor compliance with the duty. However, the measure also includes a regulation-making power so that in the event of a large number of schools failing to comply, the Secretary of State may make further provision. For example, she might specify in law who should be given access to pupils and when. This change will be fully supported by the department, and I think that it will be highly beneficial to our education system. It will improve the life chances of thousands more of our young people.

[Lord Storey (LD)]

My Lords, I shall speak generally to this group of amendments and specifically to Amendments 11 and 61. It is important that students’ eyes are wide open and they know exactly what their options are. I could not put it any better than a DfE spokeswoman who, when commenting on Ofsted’s report on careers education, said:

“Every child deserves an excellent education and schools have a statutory duty to provide high-quality careers advice as part of that”.


That is perhaps the most important thing that parents and society want for children and young people. When they go to school, we want excellent teaching and opportunities, but we also want excellent careers education. The noble Lord, Lord Hunt, referred to Connexions. Connexions was good but some of it was pretty ropey. I do not think there has ever been a time when we have had really outstanding, first-rate, quality careers education. I think I have said this before but, interestingly, if you talk to professionals they say that the best careers regime was at the time of John Major’s premiership.

The noble Lord, Lord Hunt, also asked how we can ensure that careers education is of a high quality. It is no good just providing a scheme, a strategy, books and prospectuses, or visitors to schools. How do we ensure that quality careers education is embedded in schools and colleges? The answer is in Amendment 61. The only way we can ensure quality is through Ofsted. It is strange that we do not get Ofsted to say, “Yes, this school or college has quality careers education”. Amendment 61 says that for a school to be good or outstanding it has to have good careers education. I was asked why I tabled this amendment in relation to colleges. We are not talking about careers education in schools, but I hope that if we get significant changes to the quality of careers education in colleges, it will permeate through to schools.

In a sense, the noble Lord, Lord Baker, should not have had to table his amendment. It is bizarre that schools do not invite different providers in, but he gave the answer. First, society has a view that we should go down an academic route. In my children’s school, they said, “Yes, they will do very well in their GCSEs. They will do very well in the sixth form. Yes, they’ll get a university place”. My cousin lives in Switzerland, with two children, where there is a wholly different approach: what is better for the child? The school of one of her children said, “Actually, it is a vocational route”. He went into an apprenticeship and has gone back to university.

We have this tramline approach in this country that there is only one route to go down. We need to break free of that, which is why the amendment is so important. It is also about changing parents’ perceptions. For some reason, parents think that unless their child has gone to a good secondary school, sixth form and university, somehow they have failed education. Is that not sad? We need to make real changes.

We should not have to table an amendment saying that, but of course for head teachers, each child, pupil or young person is a sum of money. Again, we heard from the noble Lord, Lord Baker, that if a maintained school or an academy loses pupils to other providers, whether FE colleges, UTCs or studio schools, it will lose that money. That then blinkers schools’ approach to what is best for the child. Sometimes they will look at the viability of sixth-form groups and say, for example, “Susan would be better going to a UTC or an FE college, but she is quite good at history and the group is struggling a bit at A-level and if we don’t get the right numbers, we’ll lose that group”. So the school pushes pupils down that route. That is the wrong way. Slightly pushing the door open and getting other providers in to make parents aware of what is available and making pupils and young people themselves aware is hugely important.

I mentioned the Ofsted report of last year into careers education, which was pretty concerning. It referred to, for example, chaotic careers education hampering the economy and the lack of an overarching government strategy. I will not go through it all. The DfE responded, and we know that the Careers & Enterprise Company has been established. I hear good reports about that. The Minister will no doubt tell us how the huge £20 million investment is turning things around. However, it is not turning things around for every school or indeed college. I hope that we will not fail our children but will realise that we need good-quality careers education, which is inspected. We also need other opportunities, providers and routes—whether they be academic, vocational or technical—to be part of a young person’s choice in their future education and career.

[Lord Aberdare]

My Lords, as a vice-chair of the All-Party Parliamentary Group for Apprenticeships, I meet a lot of apprentices and am constantly surprised and shocked at how few have either heard about or been directed towards the apprenticeships that they are on through their schools or any formal careers education. As we have heard, schools have an in-built bias towards promoting the academic route and I do not need to say any more about that.

However, with the best will in the world, teachers and parents may have only a limited understanding of the sorts of jobs and careers available in today’s job market, the opportunities they offer and the routes available to access them. Again, as we have heard, the careers education system, if one can call it that, has been at best patchy and at worst shockingly poor. Some good initiatives are beginning to emerge. The National Careers Service offers a valuable central online resource; the Gatsby benchmarks have defined what good careers education looks like, which is important; and, as the noble Lord, Lord Storey, has said, the Careers & Enterprise Company in particular is creating a vital network of enterprise advisers and co-ordinators to support schools.

However, all those initiatives need to be properly linked, and the gaps that even they allow in provision need to be identified, measurement systems need to be put in place and we need a strategy driven by government. Indeed, I am delighted that the Government are committed to producing a strategy later this year. However, there is real value in including a provision for that in the Bill. Part of that strategy, as we have heard, should be a much better, UCAS-like system for identifying and applying for technical education and apprenticeship opportunities. I am delighted that that is promised in the industrial strategy but support the idea of it being incorporated in the Bill through Amendment 9.

I also support the amendment of the noble Lord, Lord Baker. The careers system provides a bit of supply push but unless there is some demand pull, and unless schools want or are required to allow those systems to work, and young people and their parents are aware of them, the system is not going to work.

Finally, I was delighted that the noble Lord, Lord Hunt, reminded me of my visit to the Skills Show some years ago because that was one of the most inspiring ways in which to promote apprenticeships and technical education that I have come across. There was a real buzz about it; there should be skills shows all over the place. There needs to be an incentive to ensure that schools do what we need them to do. I therefore support Amendment 61 to ensure that only colleges with good careers education can get good or outstanding Ofsted ratings.

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[Baroness Garden of Frognal]

My Lords, I support these amendments. We had extensive discussions on these issues during the passage of the Higher Education and Research Bill, and they are no less relevant to further education colleges. Institutional autonomy is as important for colleges, where the people who work in them really know what works for their pupils and students, and academic staff having the freedom to question and test received wisdom is just as important for colleges as it is for universities. So is freedom of speech and preventing unlawful speech, which seems an increasing aspect of student life these days. In a way, it is almost more relevant for colleges as they have such a wide variety of students under their roofs. Both these amendments are entirely relevant to this Bill.

[Lord Storey]

I feel quite strongly about this at both levels. Looking back 10 or 20 years, we would never have thought that we would be debating the need for academic freedom and freedom of speech in 2017. If something is against the law of the land, that person should not be allowed to propagate it in any way, but the notion that students no-platform particular speakers is totally wrong. We should say loudly and clearly that it must not happen. I just want to add my voice to these two very important amendments.

[Baroness Vere of Norbiton (Con)]

My Lords, turning first to Amendment 3, I think we can all agree that academic freedom and institutional autonomy are important considerations. I am sympathetic to the spirit behind the noble Lord’s amendment. The principle of institutional autonomy and academic freedom is already well entrenched in the Bill and in the existing legislation covering further education corporations. In practical terms, the principle is also very much reflected in how the Government support and work with the sector on a wide range of issues and activities.

Further education college corporations are charitable, statutory bodies under the Further and Higher Education Act 1992. Under the Act, colleges are conducted by statutory corporations, which enjoy many freedoms and powers. For example, Ministers have no powers to issue directions in respect of the administration or management of the college, whether regarding employment matters or the content of courses, except in the very restricted circumstances in which the college is failing. As charities, colleges and their governing boards must also be independent from government. The changes introduced through the Education Act 2011 strengthened this independence, for example by removing the power of Ministers to make changes to the instrument of government and articles of a corporation, which was contained in the original 1992 legislation.

The Secretary of State’s powers are therefore extremely limited. As the principal regulator of college corporations, the Secretary of State has a duty to promote compliance with charity law. In clear cases of failure, the intervention powers under the 1992 Act allow the Secretary of State to remove or appoint members of, or issue directions to, the governing body of the institution. But those are powers of last resort, where it is not possible to address failure through other means and there remains a very strong public interest in doing so. In practice, they have never been used. Indeed, outside legislation, the way in which the Government work with the further education sector more generally demonstrates full respect for the principle of autonomy.

For example, the programme of local area reviews which will draw to a close soon is based on the principle that the governing bodies of colleges are the decision-makers when considering the future organisation of provision in their local areas. The Government have established the reviews to facilitate that decision-making, working in partnership with the sector, but have not sought to impose decisions. Similarly, although professional development activities for teaching staff are supported through government funding they are delivered through a sector-owned body, the Education and Training Foundation, reflecting the independent status of colleges and other providers. The legislative framework and the day-to-day relationship with the sector already reflect these principles and there is no need to legislate further. I urge the noble Lord to withdraw his amendment.

I move on to the second amendment in this group, Amendment 7. I thank noble Lords for raising the important issues of freedom of speech and unlawful speech in our further education system. I agree entirely that free speech within the law is a key principle of further education in the UK. We want students to be exposed in the course of their studies to a wide range of ideas and opinions, and to learn the skills to debate and challenge them effectively. There is an existing duty placed on further education providers to take reasonably practicable steps to secure freedom of speech within the law. That duty was introduced in the Education (No.2) Act 1986; it is taken seriously by FE providers and they have raised no issues or concerns with us in relation to its practice.

The requirement in this amendment would place an additional freedom of speech duty on providers so that they must “ensure” that staff, students and invited speakers are able to practise free speech on the premises of the providers, or in forums and events. I am sympathetic to the intention behind this amendment—championing free speech must be central to our further education sector—but it is not clear what such an additional requirement would mean in practice, nor how we would expect providers to change their policies and practices to meet the new standard. I fear the new threshold in this amendment unreasonably and unnecessarily imposes an additional and disproportionate burden on providers, in particular the duty to “ensure” freedom of speech without any caveats. To move away from a standard of taking reasonably practicable measures may well require FE providers to address matters that are simply outside their control. We should be wary of creating cases where a duty to ensure free speech could come into conflict with other, important considerations, such as the security of attendees at a particular event.

Technical and Further Education Bill

Lord Storey Excerpts

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

[Baroness Garden of Frognal]

My Lords, I wholly support what the noble Lord, Lord Watson, said, while equally recognising that benefits are not directly a matter for the Department for Education.

There are anomalies in the way in which we treat young people. For those in approved education or approved training, child benefit continues until the child 20 years-old. Reading the list of what counts as that, it seems even more incongruous that apprenticeships are not included. For instance, it includes A-levels, Scottish Highers, NVQs up to level 3—which, of course, can be closely linked to apprenticeships—a place on the access to apprenticeships scheme, foundation apprenticeships for traineeships in Wales, the Employability Fund programmes and places on Training for Success. There is a whole raft of education and training courses on which young people continue to get their benefits, but they lose them for apprenticeships.

We know that only 10% of apprenticeships are taken up by young people on free school meals, which is surely an indicator that that is a disincentive, particularly for families, because they will lose out on additional benefits when a child goes into an apprenticeship. An apprenticeship salary on minimum wage may be barely over £3 an hour, so the loss of child benefit and tax credits may be a significant penalty for that family to bear.

The National Union of Students said:

“If apprenticeships are going to be the silver bullet to create a high-skilled economy for the future, the government has to go further than rhetoric and genuinely support apprentices financially to succeed”.


We urge the Minister, in the interests of joined-up government, to talk to his colleagues in the benefits department to see whether something can be done to ensure that disadvantaged young people do not feel that this is a major disincentive to taking up apprenticeships.

[Lord Storey (LD)]

My Lords, I spoke on this issue at Second Reading, so I just reiterate what my colleagues have said. It seems strange that benefits are available to young people until the age of 18, so we can have a university student who has a couple of lectures and a couple of tutorials a week, if they are lucky, who gets the benefit, and a young person doing an apprenticeship, where 20% of the time should be for training, who loses that money. As we heard from my noble friend Lady Garden, only 10%—let us underline that—of apprentices come from those entitled to free school meals. If we really believe in social mobility, we should be asking why it is only 10% and whether finance is a handicap.

The National Society of Apprentices said in its written evidence:

“It seems incongruous to us that structural barriers exist to disincentivise the most disadvantaged from taking up an apprenticeship”.


We need to take those comments on board. I realise this is slightly beyond the scope of the Bill, but it would be helpful if, in his reply, the Minister could suggest that we meet his colleagues outside the Committee and talk about this issue because if there is a resolution, it would really help those people in society whom we must support.

[Lord Young of Norwood Green (Lab)]

My Lords, I support all the points that have been made. I shall speak on one narrow issue. I was surprised to learn that an apprenticeship is not an approved form of learning. I assume that, when the Institute for Apprenticeships recognises these apprenticeships, they will automatically be an approved form of learning along with all the others. I hope that when the Minister replies, he will cover whether an apprenticeship is an approved form of learning and whether, when the Institute for Apprenticeships recognises the range of apprenticeships, they will come into that category.

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[Lord Young of Norwood Green]

My Lords, I will focus on just one area because, as I understand it, the various bodies set out in the amendment each have a different role. When we debated this on the first day in Committee, the Minister told us that the body that was going to look at the quality of apprenticeships was Ofsted and that it was going to work on a risk-based approach. I told him that I understood the approach but would welcome some clarification of how it is going to apply. He said that he would get back to us on that. As far as I am concerned, there are two things here. I support the thrust of the amendment, in that we need to be clear about the roles and responsibilities, but my overall concern is ensuring that we deliver quality apprenticeships so that the brand has a good reputation among teachers, potential apprentices and parents. If the Minister has replied to this point, I have not yet seen it. Is he in a position to tell us how this risk-based approach will apply to apprenticeships?

Given that we are looking to drive up the number of SMEs involved, the risk will not be with the larger organisations with well-established reputations, such as Rolls-Royce, BT, British Aerospace and a whole host of others that have been mentioned before. We know that people who go into those organisations will get a quality apprenticeship. That is not the problem. The problem will be in small and medium-sized concerns. Given that the success of this enterprise in driving up significantly the number of apprenticeships will depend on ensuring that we embrace more of those organisations in providing apprenticeships, a lot more than currently do, this is not an insignificant issue.

[Lord Storey]

My Lords, this is a very important amendment. The Government have set an ambitious target of 3 million apprentices, and it is good to have a target to work towards. However, as we have just heard from the noble Lord, Lord Young, those have to be quality apprenticeships. In a sense, I would rather have 2.5 million apprentices, knowing that there was real quality in the education and training.

I went to look at the apprenticeship scheme run by the BBC. I was struck by the diversity of the apprentices and the quality of the training and education component of the scheme. Young people deserve quality education and training. It is not enough to say, “Here are some books—go and sit in that corner. Here is a day off—go and learn that”. Somebody has to direct the training and education. If a scheme is to work, we need to make sure that somebody is responsible for that quality.

I hope the Minister will not mind me saying that, when we met before the Bill, I raised this question with him. He said then that Ofsted would be “sampling” some of the providers. To me, that is not good enough. We have to be absolutely sure that every apprentice gets only the best.

[Baroness Cohen of Pimlico]

I support the amendment. I feel that, in all this, there is tension between what the Bill would like to see and what the Bill will be able to achieve. I keep looking for measures of enforcement, and not just because I am a native head girl or predisposed to police-type solutions. The history of apprenticeships in this country shows that they have mostly failed because of the employers. Indeed, why would it not be because of the employers? They are in charge; they are the ones with the power.

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[Lord Aberdare (CB)]

My Lords, I want to make a couple of points on these amendments. First, as I said at Second Reading, I very much welcome the desire and requirement to have learners themselves represented in the governance of the institute. I welcome also the fact that the Government have announced an apprentice panel for the institute, but I think it would be good if that was a statutory requirement in the Bill.

Secondly, it is important we ensure that the bodies creating the standards are employer-led but, at the same time, represent a cross-section of organisations. However, there is a further point to make on that. Yes, we should have SME representation, but that is easier said than done. Most SMEs find it hard to devote the time, resource and energy to being involved in these quite complicated standard development processes. I am very interested to hear the Government’s thinking on how the views of SMEs—which, after all, deliver more than half of all apprenticeships—can be represented in a way that is comparable to the others that will be represented.

I very much agree that independent training providers need to be subject to accountability and scrutiny, and that learners need to know who they can complain to. However, at the same time, I believe that independent training providers deliver a very substantial proportion of the training needed for apprenticeships, and we should be rather careful that we are not killing that golden-egg-laying goose. It is very important to have the right balance. Again as I said at Second Reading, I have a feeling that the role of independent training providers, including commercial training providers, is not very well reflected in the Bill as it stands. It is a key role and we should make sure we understand how it is going to be delivered in a way that meets suitable standards and scrutiny.

[Lord Storey]

My Lords, I support the amendment from the noble Baroness, Lady Wolf. FE Week seems to be getting quite a few mentions. I came across a piece on training providers by Peter Cobrin, who runs the Apprenticeships England Community Interest Company, which is important to highlight. He says that training providers feel,

“vulnerable, unrepresented, unsupported, unprotected, exploited and undervalued”.

Let us not forget that there are some very good training providers, just as in higher education there are some very good private providers and colleges. However, quite frankly, some need examining carefully. As the noble Baroness, Lady Wolf, said, it is important to remember that many of the people who go to these private providers take out big loans, and if that private provider collapses or reforms, they are left. That is not good enough. The noble Baroness, Lady Wolf, said it is important that accountability catches up with them. I hope that, following her wise words, we might look more carefully at this area between now and Report.

[Baroness Garden of Frognal]

My Lords, I support these amendments and the views of the noble Baroness, Lady Wolf. Equally, I hear what the noble Lord, Lord Aberdare, and my noble friend Lord Storey say about getting the balance of this right. That is important.

I have one small thing to say on Amendment 18. I agree that it is almost impossible to get SMEs to participate meaningfully in these sorts of activities, however much you wish them to do so. The federation can sometimes be helpful in providing for somebody to speak, but individual SMEs very seldom have the time or interest to take part. In Amendment 18, proposed new paragraph (b) refers to, as well as employers,

“at least one person engaged in delivering relevant education linked to the standard being assessed”.

It is important that this group of people includes trainers and awarding bodies, who bring a dimension to these affairs. To have a broad range of people within this group would be particularly important.

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[Lord Knight of Weymouth]

My Lords, I remind the Committee that I am a patron of an awarding body, ASDAN. Also, as a Minister, I spent three years building a clear, recognised qualification in the form of diplomas, which then got killed off after a huge amount of time, effort and money were spent trying to develop them, although some of them certainly seemed to be well received—engineering comes to mind.

I paid close attention to what the noble Baroness, Lady Wolf, said. I respect the work that she and the Sainsbury commission did. I certainly agree that we need these to be clearly recognised qualifications, but there are a number of ways to get to that point. I remember well the SATS marking crisis through which I had to navigate as a Minister. We had a problem with the company carrying out the marking. We ended up having to dismiss it from the contract and had to re-let the contract. We found that there was only one awarding body with the capacity to do that work. Edexcel effectively had us over a barrel. Happily, it was a responsible organisation and did not want to exploit the monopoly position in which it found itself, but it is really dangerous if you find yourself without the competitive capacity for different people to respond as and when circumstances change.

I welcome what the noble Lord, Lord Lucas, has done by raising this issue and giving us an opportunity to explore it. Clearly, there will be general capacity if different awarding bodies are awarded the contracts for different groups, but there would remain issues about their specialism in the subjects attached to each of those groups. My instinct is that the Sainsbury review might have got it wrong in this case. It may be that I just do not understand well enough what the department has in mind in terms of the model. I may not understand the extent to which it wants to specify the inputs into the qualification, how much it is concerned with the outcomes, how detailed it wants to be, how much it wants to specify the pedagogy, or whether it is thinking that these are wrappers in which you could put other qualifications, so that there is a single overarching contract-awarding body. Perhaps the Minister can enlighten me in his response or in some other way.

As the Committee has discussed, we must put quality first. As I keep saying, we must ensure that we have agility. The time it takes to develop qualifications reduces agility, and a seven-year contract makes me very anxious about how that agility can be preserved as skills needs change in the economy. I am particularly keen that we embed in the design the potential for innovation in assessment and awarding. I see innovative practice going on around the world, particularly by employers using digital badges that can have wrappers put around them to keep up-to-date with skills and the value of an employers’ own qualification, with a meta-qualification on top through the wrapper mechanism. It is crucial that we allow for that. The notion of a single contract for these qualifications, thereby reducing competition, makes me worry profoundly about innovation. I find myself, as a Labour Peer, arguing with a Conservative Government that we want competition. I hope that the Minister will revert to instinct, listen and agree competition is good to improve delivery and agility in the system.

[Lord Storey]

I remember that my nursery nurses were terribly upset when their NNEB qualifications went and they became NVQ level 3. They were devastated, so there is something in a name and perhaps in a bit of tradition. I am a bit torn. I understand the Sainsbury review and the Government saying: let us create and agree a standard for the different pathways and maintain it. That is the qualification we will have so, presumably, various organisations can bid for it and, if they win the contract, the Government will ensure that they maintain the quality and standard.

However, as has been said, there is something about having competition. You have to look only at GCSEs, where the Secretary of State at the time wanted to have a single provider. There was a sort of rebellion against that and it did not come to pass. Schools and young people themselves can choose which awarding body to go for. Different awarding bodies suit pupils for different reasons—the content may match their study. We must think carefully about this. It is important for parents, young people and employers. Getting the name right is important but sometimes people also like letters after the name—there is a later amendment from my noble friend Lady Garden about that. I am caught on this, but I hope that we can explore the best way forward.

[Baroness Cohen of Pimlico]

I am responsible for 2,000 degree-level apprentices and about the same number of others. At the moment, we do what the employer wants. If the employer arrives and says: “I would like the formal training to have these outcomes”, we say, “Right”, then we discuss it and bid for it. I had been assuming that we could adjust to the new regime. If the Institute for Apprenticeships stated the outcomes that it wanted, we could teach to those outcomes because that is what we do. We would be able, in essence, to do a wraparound to suit a particular employer, which would include the vital bits that the Institute for Apprenticeships wanted. I am a little puzzled if we are to be told that we all have to teach the same thing on, say, the finance course by the bit of the Institute for Apprenticeships that is working out finance training. At the moment, let us say that KPMG tells us how it wants us to do finance training. We would do that but if someone else wanted it to be slightly different, our competitive advantage over the years has been built on adjusting to do a different sort of finance training.

I am not quite sure where I am going with this, but are we providers still to be allowed variation in any way if an employer asks us to do it slightly differently, provided we include a certain number of outcomes and standards, as set out by the institute? To take an example from my experience, with our graduate law course we made our name by introducing a City law course that the City wanted. “Wait”, we said, “we’ll do that”. Of course, it is all the same law but it was specialist. We did that and not some other bits of law. I can imagine that being the outcome still: some City firms want varieties of law taught that nobody else cares about, as in shipping law, and some accountants want things that nobody else much cares about taught, as in shipping finance. Are we to end up with an agreed set of standards to which we must adhere, but around which we can wrap something that employers might want, or not? I am arguing for a setting of outcomes and standards by the institute but with a little deviation allowed, provided those apprenticeships include the basic standards and outcomes. Will the Minister tell me about that?

--- Later in debate ---

[Lord Young of Norwood Green]

My Lords, I support the amendments and shall speak specifically to Amendment 20. When I ask employers what they value most about young apprentices, the qualities are what I often hear referred to here as soft skills, but they are not, really they are essential skills. They are the skills of being able to turn up on time regularly, work as part of a team, show enthusiasm and so on. Often, ironically, the complaints that you get from employers are about those who are technically well-qualified but lack those essential skills. This amendment is about creating flexibility and recognising that there are young people who will, for a variety of reasons explained today, find it difficult, as my noble friend Lord Hunt said, to go through the demoralising impact of resits for qualifications that will not assess their innate capabilities, as my noble friend Lady Cohen described. I hope that we will get a constructive response.

[Lord Storey]

My Lords, I add my support to Amendment 20. Yes, it is absolutely right that we do all in our power to ensure that young people are numerate and literate. It seems reasonable to say that we want them to get to a certain level in mathematics, but that should not be a barrier to everything else. Special needs have not been mentioned. Are we to insist that children who have particular special needs or an aversion to numbers are to be included? We would not expect children who are dyslexic to get to certain standards in literacy because of the severity of their dyslexia.

We have heard about Travellers and immigrants, but there are young people for whom the system—perhaps poor teaching—has not helped them to get it. We then have this whole re-sit culture, and they get more and more fearful of failing and we do not want to label people as failures. I enjoyed the argument and think the word “flexibility” is so important. I know young people who have been taken on by employers, and the employer has said: “Well, they’ve got problems with numeracy and literacy, but they really sparked at this particular job”. Some of them have gone on to take some qualifications later. Let us not label people, let us have flexibility and do all we can to make sure that young people get to a certain level—“C”—in mathematics, but that should not be the be all and end all.

[Baroness Buscombe]

My Lords, I thank all noble Lords for the amendments and welcome the opportunity to debate them. I fully understand why the noble Lords, Lord Watson, and Lord Hunt, are supporting Amendment 20. Having a sound grasp of English, maths and digital skills is fundamental to getting ahead in work and life. Raising literacy and numeracy levels at all stages of education, including post-16, is essential and remains an absolute priority.

We recognise that current requirements are still low by international standards, and we believe that individuals should have higher aspirations. In the longer term, as the quality of pre and post-16 English and maths teaching and associated learner outcomes improve, the Government should raise maths and English requirements to reflect those of higher-performing international technical education systems.

Since we made it a condition of funding, all 16 to 19 year-olds beginning a study programme who have not achieved an A* to C GCSE in English and maths must continue to study these subjects until they do so, unless specific special educational needs or disabilities prevent them. I will repeat that to underline it: unless specific special educational needs or disabilities prevent them from doing so, so there are exceptions. This has resulted in thousands more students securing these GCSEs by the age of 19. The OECD has commended us on our reforms and, working with schools, colleges and employers, we will build on them.

We will do so by implementing the Sainsbury panel’s recommendations on English and maths. We have accepted the panel’s recommendation that there should be a single set of English and maths exit requirements governing college-based technical education and apprenticeships, and we will continue to require all 16 to18 year-olds to study English and maths if they have yet to achieve GCSE A* to C in these subjects.

The Government consider that English and maths requirements should be included as steps towards occupational competence. As well as good literacy and numeracy, everyone needs an essential set of digital skills to succeed in the modern workplace. Digital skills requirements should be tailored and groups of persons will be in the lead to specify digital skills that are required for entry into particular groups of skilled occupations.

We believe that there should be a minimum level of English or maths which all individuals must achieve ahead of securing technical education certification, as is already the case for apprentices. We will work with the institute to ensure that occupation-specific English and maths requirements are incorporated into each route.

Before I turn to the amendments in the name of the noble Baroness, Lady Garden, I repeat the point about exceptions. We are talking about people with special needs and so on, where it may be just too difficult. The noble Lord spoke about the resit culture, and we absolutely understand that. However, in an environment where we are offering young people the opportunity through apprenticeships for genuine employment in the world of work, there is a hope and desire that those people should understand that basic core skills in English, maths and digital skills will be essential for their future. That is not least because we all know that, in the current world of work, people change jobs a lot and are not necessarily going to follow the same role for ever. Therefore, they need that basic requirement to support themselves into their future.

[Lord Storey]

I am grateful for the Minister’s reply, but how will these exceptions be decided? Will they have to have an education healthcare plan or will they be notified by the school? What will be the mechanism for exceptions?

[Baroness Buscombe]

The noble Lord raises a good question. I do not know the answer, so I will write to him on that.

[Baroness Buscombe]

I hope that I can help the noble Lord, Lord Young. That would not be a barrier to an apprenticeship. We are saying that they would have to continue to study through the apprenticeship and stay in that process in order to receive their certification.

[Lord Storey]

That is very helpful. So it is not a barrier to them doing an apprenticeship but they would be studying for their GCSE maths at the same time. Would the family then be entitled to tax credits because the young person is studying maths?

[Baroness Buscombe]

The noble Lord, Lord Storey, makes an interesting point, but I certainly would not want to commit on that. Let me clarify: they would study and do these resits, as we have been calling them, through the apprenticeship process—they would do them at the same time.

I want to attempt to reply to my noble friend Lord Lucas, who asked what would happen if awarding organisations have business overseas. The answer is that the institute can grant a licence back to the awarding organisation for use of the qualification documents—in other words, for use abroad. If there is an existing qualification for an awarding organisation that is out of the institute’s scope then the institute holds no copyright on that.

I thank the noble Baroness, Lady Gardner, for tabling Amendments 21 and 25. I appreciate why she has put forward these amendments, which would allow awarding organisations to retain ownership of the copyright of documents under the new reforms. However, with respect, I cannot agree to them for the following reasons.

First, the qualification is to be approved by the institute, so it is right that the institute is the ultimate owner of the copyright. This will ensure that it can carry out its functions, including awarding licences for the delivery of the qualifications. Also, as there are likely to be multiple contributors to each qualification, the amendments are likely to make it impractical for the institute to carry out its functions to approve the new qualification. All contributors are likely to want a say in matters that relate to their particular part of the qualification. The institute should have the final say if the qualification is to be approved by it.

Secondly, the amendments would be likely to stifle competition once the licence comes to an end. Those awarding organisations whose documents have been approved by the institute would be in a far stronger position than those who were unsuccessful to rebid for a licence. Of course, the authors of documents that make up a technical education qualification should decide whether to give their consent to the copyright being transferred to the institute before the qualification is approved. If they do not, the institute can remove that document from the qualification. That is provided for in the Bill: I draw the noble Baroness’s attention to the provisions in new Section A2DA which provide safeguards for both the institute and the awarding organisations.

Furthermore, awarding organisations do not have to submit a bid to the institute for the new approved qualifications if they do not like the arrangements offered. Under the reforms, it is expected that awarding organisations will go through a comprehensive procurement process before being granted a licence to deliver a qualification for an occupation or group.

Technical and Further Education Bill

Lord Storey Excerpts

Committee: 3rd sitting (Hansard): House of Lords
Wednesday 1st March 2017 Grand Committee

[Lord Stevenson of Balmacara (Lab)]

My Lords, it is a pleasure to appear in the Committee. I have been present on various occasions during the first two sittings, but I have not been able to find an issue on which I wanted to speak; therefore I come with my powder dry.

We have no argument of substance on this part of the Bill, because we understand what is happening. It is essentially a good housekeeping measure, rather than a threat to any existing or future institutions. It arises from two sources. First, there is a proper and appropriate sense of wanting to ensure that in any default situation, such as liquidation or insolvency, a process is in place and all the major players know what happens and how. It also comes from a wider consideration of how public services are procured and delivered.

In the good old days, as some might say—I say it in heavy quotes—public provision of such services as further education, but including utilities more generally, would always have the underlying assumption that the Government of the day would carry any debts incurred. Of course, that does not happen under privatisation—there is no particular reason why it should—but the responsibility for continuing work that is in the public interest still has to be resolved. That is why, over the past 25 to 30 years, there has been a growth in special regimes for insolvency. They are not unusual. They are broadly all of the same pattern. That is unsurprising as they come from one cutting shop: the Insolvency Service. They carry a common approach: they are instituted to ensure that, where it is appropriate and necessary, it is possible to intervene in the ordinary processes of insolvency or voluntary liquidation to the extent to which it is thought proper that the purposes for which the service exists are maintained, to ensure that those who are relying on it or have made it part of their lives in good faith are not let down by any cost-cutting arrangement.

Having said all that, we have tabled some probing amendments, to which I hope that we will get good responses on the record. Nothing will be unexpected—much of it came up in the other place—but we have learned a bit more about how the system operates, so there may be a slightly sharper focus.

I move Amendment 37 and speak to Amendments 38 and 39. This first group focuses on the education administrator, who is the person to be appointed by the court—the courts can act only on the request of the Secretary of State in England or Wales, depending on which territory they are in—and, if appointed, has responsibilities which will be set out both in the Bill and the broader range of insolvency legislation alluded to in the primary legislation; I expect that regulations to follow will fill in any gaps. We are not at variance with the Government in proposing that the system applies, although there will be things that we want to probe later.

The purpose of these three amendments, taken together, is on the question of whether we have got the right person to do this work. We have not seen many colleges go into liquidation or insolvency, which is a good thing. We were reassured in another place—so we do not expect it—that nothing in the Bill should be read as taken to imply that the Government have in mind a raft of closures. On the other hand it is fair to ask the Minister, when he comes to respond, to help us a little about what the context is for this.

The figures provided by the Minister for Apprenticeships and Skills in the other place were slightly obscure. He said that,

“80% of colleges are either good or outstanding”,


and that some,

“59% of institutions are in good financial health and 52% are operating with a surplus”.—[Official Report, Commons, 14/11/16; col. 80.]

One can of course read that the other way round: you could say that 48% are not operating with a surplus and that a situation may therefore arise which we are not fully apprised of. The Minister might wish to comment on that. I do not necessarily see that as an issue and, if he wishes to take time to write to us, we would be happy with that.

The context is also a little more complex, in the sense that we are well aware that there is a more general decline in further education. The ongoing work of the area reviews may or may not lead to closure as a result of mergers. Mergers cannot be imposed on the system but if the system wanted to do that and if a particular college was weaker, we may find this issue in front of us in a relatively short time. The procedures therefore obviously need to be right but, if the Minister could say a little more in that context about his perception from the centre of whether a number of closures will arise from the area reviews, that would obviously be interesting. We do not know of any and are aware that work is going on but some sense of that, if not the actual detailed numbers, would be helpful.

In the other place, the Minister was pressed a little about the context of what I have been saying. He came out with a nice rubric when he said that Part 2 of the Bill was,

“about protection, insurance, prudence and caution”.—[Official Report, Commons, Technical and Further Education Bill Committee, 29/11/16; col. 166.]

He was not picked up about that list of words. It does not quite have the ring of an aphorism about it but it is an interesting list. Would the Minister like to reflect on whether that is his reading of the situation? I take it slightly differently: I think this is a prudent, sensible and cautionary approach, as I do not see any red lights arising from it and gleaming in the dark that would cause us to have difficulty, and that the issues are appropriate. Those are the general questions.

On the questions raised by the amendments, Amendment 37 questions whether we are right in assuming that, at present, the Bill tends to focus the attention in relation to colleges and their continuation on a systemic approach. That was slightly picked up by the area reviews as well, in looking at the holistic approach to an area, although from the bottom up—in other words, from the locality—FE colleges are often seen as important bulwarks of local community activity. Particularly in rural areas and areas of lower density, they can provide a centre not just of education and training but for other activities, so there is a wider context for this. Amendment 37 asks that the education administration system, particularly the education administrator, should, in addition to the list in the Bill, take in the need to,

“minimise the risk to a local community of a long-term loss of technical and further education provision”.

That will be an important issue for many areas and I will be interested to see the response.

Amendment 38 would give more detail than is currently in the Bill about the consultations, discussions and debates that must take place before the education administrator takes forward the proposals that may come to it. We will obviously come to a wider view about this in the next group. This would include the “quality of education provided”, the capacity of other bodies or institutions and,

“the infrastructure of the local area”—

again, the reference is to local rather than national issues. An issue that came up strongly in discussions in the other place was of how students, many of whom will be relatively young, will function if they have to add a significant transport arrangement to their other education requirements. How exactly does that fit in with some of the overarching issues we will come on to, in relation to the balance between maintaining a provision in a place and the need to provide local services and community support in that area, as opposed to the needs of the students in terms of the qualifications they are trying to obtain, which might be better dealt with in another college, perhaps a couple of hours’ travel away? One can see the impact that would have in terms of community, and on the individual. A slightly more detailed list, as in Amendment 38, may be overprescriptive but the intention is to make sure that wider consideration than a simple binary question—open or shut—should face the education administrator.

Thirdly, on Amendment 39, the question is of who should be consulted. There is obviously an expectation, and comforting words were given in the other place when this issue was discussed. However, we have tabled an amendment that specifies that the students in particular—they are often omitted in these considerations —should be consulted, and that staff and recognised unions at the body concerned should also be included.

[Lord Storey (LD)]

Given that insolvency is a major part of the Bill, many of us were concerned that there might be something hidden that we did not appreciate or understand, which is perhaps unusual. I thank the civil servants. I hate that term. They are civil; they should not be servants. My noble friend Lady Garden and I met them yesterday to talk about insolvency, and I came away very reassured. Actually, I almost did an about-turn and felt that further education was protected in many respects.

The amendments are right. I do not foresee FE colleges becoming insolvent, because the new measures protect them in a more robust way than currently. During the area reviews, there has been a safety blanket. When they are finished and the new regime comes into place, it will be a much better landscape for FE to operate in. Having said that, in the 0.001% where something happens, it is right to point out that students need to be considered, as do the community and the staff. That is particularly so in rural areas. If a college goes in a rural area, the loss of it and its courses can be devastating to its students.

I will go along with it but I am never quite sure about “consultation”. Of course one can consult. If in the new landscape a college is on the road to insolvency, presumably we would pick that up pretty early on. It would not be a case of its suddenly being insolvent—“By the way, we’re closing down and we’d better consult students and staff”. We would see the process happening gradually. Any well-managed system would of course consult those bodies. When I see “consultation”, I always ask how we will consult. Is it a tick-box exercise, or a letter to everybody? When we have done the consultation what do we do with that information, or is it just, “It looks good so we’ll say it”? I understand the thought behind the amendment, however.

These amendments are okay. I am just beginning to understand the Government’s desire—I am pleased about it—that, under the new combined authorities regime, combined authorities will be involved in the adult education part of further education. I do not yet understand how that happens in practice as well as principle. I have been involved in a couple of emails about that, but I would like to understand it before Report. Having said that, I am happy with the amendments and I guess we will support them.

--- Later in debate ---

[Lord Stevenson of Balmacara]

My Lords, I was hoping to have a short breather while we discussed other important matters, but unfortunately that has not happened. We move on to Amendment 47, which refers back to some of the issues that we have been dealing with regarding process, particularly what happens to assets. Clearly much of the work of the special administration scheme will be the ability to bring forward and, if necessary, sell—in other words, dispose of—assets that would otherwise not be there that could be used to repay the creditors, and I suppose might in part be used to maintain the operation of the college that is under liquidation.

To stand back a little from the issue, the interesting thing is that much of what we are trying to achieve in this special educational administration is more akin to the Chapter 11 processes in American bankruptcy law than to those here. We have the same basic elements: a court-driven procedure, the protection measure in place in order to make sure that the institution is kept as a going concern, and a commitment that is well expressed in terms of the special purposes of the education administrator to take it through. The question is whether or not that follows through all the way.

The amendment is probing, but it builds on one or two issues regarding which we want to get responses from the Minister on the record. In the first place, it would be helpful if we clarified that, as has been explained by the Ministers in their responses, this is unlikely to be a regular occurrence and will not be precipitated by the Bill, but it might happen and therefore we should walk through it and understand it. If we have a situation where a college is going insolvent, either the system can then operate on existing measures or the Secretary of State can apply for and obtain an order to establish the special administration, and then we are into the process that we have talked about at length and do not need to go back to.

However, it may arise that funds coming into the college to maintain it as a going concern are difficult to sustain. There may be changes in government policy or other changes in external funding that mean that it will not remain a going concern. So we are talking about maintaining the services and facilities for the students for as long as possible but in the certain knowledge that the institution is going to close down. At that point, I am sure it will be in the mind of the special administrator that some assets could be sold so that money could be obtained. Depending on the rules laid down for them, it would probably be rather difficult for that person not to engage with that possibility. However much we may wish to have the assets and the buildings maintained in case there is an uplift and the funds come back, the cruel reality of the situation will probably kick in and mean that the assets will be sold.

If the institution were a charity, as many of these bodies are, the question would not arise because, under charity law, charitable bodies holding assets are not allowed to dispose of them to third parties—in fact there is a prohibition that they must dispose of them to charities of similar nature and purpose so that the charitable purpose under which they were originally established may be maintained. I would be grateful if the Minister could confirm that that is the Government’s understanding of the issue. Where special systems or incorporation arrangements are in place, I assume that that will also apply, but charitable status is the main area here, so we are talking about a relatively small group of places where the natural process would be perhaps to squeeze the college down to a smaller area and get rid of buildings, equipment and so on.

The problem then arises that funding was almost certainly originally provided from local authorities but, since then, certainly from central government, so there is an investment issue about whether the funding that has been provided should not be better retained in the sector, even if it cannot be retained within the existing body as a going concern. So the amendment poses this question: in the relatively unlikely event of this happening where the college is not a charity, what happens to freeheld assets that could be disposed of where those assets were originally funded from the public purse? Is there not at least a moral obligation to ensure that they are retained within the sector? I beg to move.

[Lord Storey]

I have always been concerned when public money has been used to purchase a facility—let us say that it has been used to purchase an FE college and that FE college then sells off land, for example a playing field. That playing field may often have a dual use: perhaps the local community uses it for activities, for example, which is good for the FE college and for the local community. So when it sells it off, public money is being lost to that community.

As we said under the first group of amendments, the likelihood of insolvency is remote. With this amendment, I get the point that public money bought the facilities but, presumably, you could have local authorities—I have seen it quite often—saying, “We’ll have the facilities”, but then selling them off to the private sector to get that money in for other things for the community. Is that the point that the noble Lord is making?

[Lord Stevenson of Balmacara]

No, it is not actually—although that is a scary prospect. In my scenario, we are in a liquidation situation in which decisions have been reached that the college is going to decline, because it cannot be made secure. It has been superseded by the court order now in the hands of the special administrator, and a decision has to be made about what happens to the residue. That may take time, but at the end of the day there will be a blank wall and the car will hit it. At that point, what happens to those assets? It is not that they could not be sold for benefit—the noble Lord’s point about land is absolutely right. I think it is pretty unlikely, but there could be land associated with FE colleges that, if sold, could realise development potential which could pay off all the creditors, and that could be seen to be a good thing. But if that money was originally provided for the education—not for a charity, because that is protected—what is the right way to go forward?

[Lord Storey]

In that case, there is merit in considering the amendment.

[Baroness Cohen of Pimlico]

I support what I think the amendment is about. There is a worrying set of complications, in my mind. Someone has provided the money to keep the FE college going while the special administrator decides that actually it cannot be kept going. Where does the person who provided the money rank among the creditors? We are talking about selling assets at the end of this. For a start, the bank might have a charge on those assets, in which case I guess that is the answer, but somebody has put money in to keep the business going. I have done this on behalf of the Department of Industry—we took back the money that we had put in to keep it going. What is the order of batting in relation to the local authority, or whoever it is, who put the money in to keep the institution going, and the rest of the creditors?

--- Later in debate ---

I appreciate that the Minister cannot give a detailed response to these issues today—I do not expect that—but I trust that he will acknowledge that the problem exists and that the Bill is impacting in advance of Royal Assent. I invite him to write to me with his understanding of the issues, setting out what, if anything, he feels able to do to assist colleges caught up in them through no fault of their own. On the basis of what he says, we shall consider whether to revisit this topic at Report. I beg to move.

[Lord Storey]

My Lords, I support this important amendment. As we said at the beginning and keep underlining, the insolvency regime is highly unlikely to happen, but that does not mean that we cannot give comfort to staff working in further education, particularly at a time when all the changes, area reviews and, indeed, the Bill have created uncertainty when they need certainty. As we have heard, often through no fault of their own, they could be in a poorer financial place. When we have just heard that BHS staff are to get their full pension entitlements, would it not be nice if the Minister would agree the amendment?

[Baroness Cohen of Pimlico]

I raise another worry that has come to me, which is the reverse. If a public or private company is in danger of takeover, one very good way to prevent that is to introduce a poison pill. The quick way to do it is usually through a very generous pension scheme, or a pay-off scheme for your senior staff. If I were a threatened institution, I might be tempted to consider either of those. It is a hard life, but do we have any means of dealing with threatened institutions which introduce financial measures which will make it much more difficult if they need to be closed or otherwise dealt with?

--- Later in debate ---

Of course, this is a way in which to discuss governance. The Minister made sympathetic comments on initiatives that are being taken. It particularly relates back to ensuring that good quality governors are appointed, and I applaud the Government’s efforts in this. But somehow a stronger governance structure has to be built to make sure that these institutions are well governed in what has become a very difficult climate. None of us should underestimate the difficult climate in which FE colleges have to operate. I want to make sure that they have the strongest possible governance. I beg to move.

[Lord Storey]

My Lords, I support the amendment. The noble Lord, Lord Hunt, has spoken wise words. In local government, the quality of officers advising elected members is hugely important—the independence of those officers and their ability to challenge and scrutinise with neither fear nor favour. In further education, we are talking about multimillion pound budgets. You have only to flick through the pages of the further education press to see some of the horrendous accounts of what has gone on in the past. I do not want to go into those lurid details; I shall leave it to people to have a look at them if they so desire.

What that suggests to me is that the governing body of those institutes has to be of the best possible calibre; it cannot be a friend of a friend, not wanting to offend the principal. It is often difficult to attract calibre governors, so the role of the clerk cannot be some sort of part-time lesser role; they have to be people who are confident in themselves. Those three words—“scrutiny, challenge, transparency”—are really important. This is the tail-end of Committee, but to get the Bill right is important. The points that the noble Lord, Lord Hunt, has made are also important. I hope that between now and Report we can look at this in a little more detail, because it is crucial.

[Baroness Cohen of Pimlico]

I support the amendment. I am new to the business of voluntary governorship in state-funded institutions. I have been fortunate for most of my working life to have been in organisations that had admirable company secretaries, who had the equally difficult task of standing up to chairmen and chief executives—but these were well-trained, qualified and well-paid people. The problem in all education is, of course, that anything that is not a teacher reads like an unmerited overhead.

I am not quite certain what I should propose as a remedy, but this point is key. Many of the messes that schools and further education institutions get into have to do with governance, and that has to do with a clerk who is not actually qualified and probably not properly paid.

Technical and Further Education Bill

Lord Storey Excerpts

Report stage (Hansard): House of Lords
Monday 27th March 2017 Lords Chamber

[Baroness Wolf of Dulwich (CB)]

My Lords, I also support the amendment and share its concern for the small but important group of young people who may be denied an apprenticeship. I will also speak to Amendment 16 tabled in my name and lend strong support to the general argument that we must provide financial guarantees and security to young people in the training field. I declare an interest that, as a member of the Sainsbury review, I was part of the panel which lies behind other parts of the Bill. I also strongly welcome the provisions to ensure that, should an FE college fail, special arrangements will be in place to make sure that students are looked after; that clearly set out procedures will swing into place; and that they will not just go to the bottom of the list after creditors, in the hands of administrators whose responsibilities and skills are essentially commercial. It is absolutely right that the Government have recognised this as their duty. It is their duty because, by funding young people and adults, encouraging them to enter training—and, in very many cases, to take out loans—the Government have implicitly promised that an institution to which they are lending money will give a good-quality education and will endure to see students through. The introduction of loans is a mammoth change and lies under much of the Government’s conviction that they need to change the HE regime. We must recognise that the Government’s ambition for huge increases in adult learner loans changes the environment in which young people and adults are studying and training.

Many noble Lords will know that failures are not unheard of—one wishes that they were. In the United States, huge companies have gone under, leaving many thousands of people with loans. These are not all at degree level; they are often at associate-degree level, which comprises two-year courses. On the one hand, therefore, it is very welcome that we have these provisions for FE colleges, but, on the other, I find myself completely unable to understand why equivalent protections should not be introduced for people training and studying in institutions which are not FE colleges and which also offer—and are being funded to offer—technical education. Many of these people have loans, and many of them are not mobile. The loans represent large sums of money for them, and they have made big changes in their lives to undertake this form of training. Again, it is tremendously welcome that the Government are putting so much effort and money into technical education. However, we have to ensure that the promise, encouragement and—sometimes—pressure to enter technical education is matched by a guarantee that the Government will deliver on their implicit promise.

Against this background, the repeated failures—that is what it has felt like—in recent weeks of a number of private training providers should make us aware that this is not a hypothetical situation. Like the noble Lord, Lord Watson, I was not very convinced by the letters from the department and the SFA. My noble friend Lady Watkins will speak in a moment. She and I had a very productive meeting with the Bill team. We appreciated their willingness to listen to our arguments. However, the letters that we received seemed to amount to a combination of the statements, “We are muddling through” and “There aren’t very many of them anyway”. That is not adequate at a time when we are embarking on a major rethink—and, I hope, a major expansion—of technical education.

In Committee, the Minister noted that you cannot treat private businesses as though they were public organisations. That is indeed true. Although many private training providers are small charities, many others are commercial organisations, as the noble Baroness, Lady Cohen, said. Many of them survive entirely on government contracts and are very small. That is why I have proposed a mechanism which I think would be entirely appropriate for this situation. We have heard about it already, and I thank the noble Baroness, Lady O’Neill, for first bringing it to my attention. It is well established, costs the Government nothing and would not cost providers anything that would begin to wipe out their margins. It is well and frequently adopted in other sectors and I cannot see why it should not apply here.

That brings me to my final point—the idea that we do not need to worry about this matter because only a few people are involved and the risks of failure are quite small. Even if the figure is less than 1%, that is hundreds of people a year on current levels of loans. If we have the expansion that we hope for, thousands of people a year will be affected. To give a medical analogy, if 1% of life-changing operations were cancelled and eventually lost because people got older and were never able to have their operations and had to go back to the bottom of the waiting list, I do not think that anybody would find that acceptable. Therefore, I strongly hope that the Minister will assure us that at Third Reading he will be able to bring concrete proposals to this Chamber and that we will see the same acceptance of the importance of looking after students in the entire technical education sector that we so happily see in further education colleges.

[Lord Storey (LD)]

My Lords, I will speak to Amendment 14 and to Amendment 16, which is linked to that, and will say a few words in support of Amendment 1.

It is interesting that a large part of the Bill is about insolvency—what happens if a college becomes insolvent. Yet it does not say very much about what happens if a poor student, through no fault of their own, becomes insolvent because of debt problems arising from the fact that their college no longer exists. We also encourage private providers—I say right at the outset that there are many good private providers, who have an exemplary record and are very worth while. Sadly, however, some providers have caused immeasurable harm to young people, and we need to ensure that there is a proper safety net for those young people.

--- Later in debate ---

[Lord Lucas]

My Lords, I shall speak also to Amendment 9. These amendments are very simple. They pick up on my noble friend Lord Baker’s excellent amendment, which was accepted in Committee, to point out that it is not just the local FE college or other major provider that wants to get into schools. There are a lot of excellent organisations which need to get into schools. Women in Construction is one. In needs to get the message through that there are a lot of very good jobs for women in construction. There are similar efforts going on about women in engineering and women in computing. They are not education providers. They have been funded by education providers and employers to produce a flow of students to education providers in general. Those organisations need to get into schools just as much as individual providers, if not more, because in many cases they have a level of prestige and glamour which the local FE college lacks. I beg to move.

[Lord Storey]

Amendment 17 is in my name and those of the noble Lord, Lord Watson, and my noble friend Lady Garden. I moved a similar amendment in Committee, when I talked about “good” or “outstanding” FE colleges being awarded either status only if their careers education was of a high standard. The noble Baroness, Lady Morris, spoke in a sort of roundabout way about the importance of careers education, but was concerned about straitjacketing through the use of “outstanding” and “good”. Having reflected on what she said, I have come back with a slightly changed amendment, which highlights the importance of careers education in further education and says that when Ofsted carries out inspections, it is important that the careers guidance in those establishments be of a high calibre.

One of the most important things that we need to do for young people is to provide that guidance and knowledge about careers. Many of us do it with our own children: if careers advice is not available, we have networks of people who can talk to our children and perhaps provide opportunities for them to do work experience. But many children and young people, particularly those from disadvantaged backgrounds, do not get that network of support, and it must be down to the education system to provide that. Careers education should start in primary school. I remember that at my own school we had a careers session, where people from different jobs and workplaces would come into the school. There would be a carousel approach, and children could listen to them. That should go through to secondary schools, so I was delighted that the Government accepted the amendment from the noble Lord, Lord Baker, on university technical colleges being able to come into schools. They will be able to go into schools and tell young people about the different opportunities. We do not want a straitjacketing approach but one which lets young people see all the different possibilities. We have talked about this for a long time and have heard all sorts of promises about what will happen down the road. The situation is getting slightly better, but surely, if we are going to do one thing, the most important thing we can do for young people is to get careers education right.

I was interested in what the noble Lord, Lord Young, said on Amendment 4. Careers education is not just about careers advice and guidance, as important as those are, but about preparation for a career. If a young person has a career opportunity, I would have hoped that the educational establishment would prepare them for that, whether through techniques for interviews, filling out an application or preparing a CV—all those things come together in good careers advice. I hope the Government will listen to this, as I am sure they will, and that we can agree that careers advice should be part of the establishment of good FE providers.

[Lord Aberdare]

My Lords, I support Amendment 17 in the name of the noble Lord, Lord Storey. It is widely recognised, including in a number of reports published by some of your Lordships’ committees, that the quality of careers education and advice in both schools and colleges has hitherto ranged on a spectrum from patchy to poor. Surely one reason for that is the lack of any real incentive for schools and colleges to up their game and improve their offer. It seems to me that one of the most effective incentives that could be put in place is for schools and colleges to know that the quality of their careers education will be a significant factor in determining what sort of rating they get when they are inspected by Ofsted.

As we have heard, some good things are happening: the National Careers Service is developing its offer and in particular I am very impressed by what I have seen of the Careers & Enterprise Company and its effort to put a network of schools co-ordinators in place. None the less, we still hear constantly that, although schools are good at reporting their academic progressions and the number of people who have gone on to university or further academic education, they are not nearly so good at talking about students who have gone on to apprenticeships or further levels of technical and professional education. I rather like that term “technical and professional”, and thought the Minister in the other place was also rather keen on it, but that does not appear to be necessarily the case.

I very much support the amendment, particularly as it would go no further than requiring Ofsted to take account of the provision of careers advice in carrying out inspections, so it would not appear to be a huge burden on either Ofsted or the schools. It just sends a signal, as we always used to like doing. I support the amendment.

--- Later in debate ---

Moved by

[Lord Storey]

17: After Clause 40, insert the following new Clause—
“Further education colleges: careers advice
(1) In carrying out inspections of further education colleges, and giving a rating to colleges, Ofsted has a duty to take into account the careers advice made available to students by colleges.(2) For the purpose of subsection (1), “careers advice” means a combination of face-to-face careers advice and careers advice that is provided remotely.”

[Lord Storey]

I listened carefully to the Minister’s reply, for which I am grateful, but I do not think he went far enough and, given the importance of careers education, I wish to test to opinion of the House.

Technical and Further Education Bill

Lord Storey Excerpts

Ping Pong (Hansard): House of Lords
Tuesday 25th April 2017 Lords Chamber

[Lord Watson of Invergowrie (Lab)]

My Lords, I acknowledge that the Bill is a better one than when it began its progress through both Houses. We shall not seek to impede its journey to the statute book.

The addition of the amendment promoted by the noble Lord, Lord Baker, and others, represents an important step forward in ensuring that school pupils have explained to them the full range of options, not just those whose choice of an academic route might benefit the school’s coffers. It should not have been necessary for an amendment to be passed to secure that, because strong careers guidance is critical to promoting apprenticeships in schools. If the Government’s target for apprenticeship starts is to be achieved and sustained, as we all hope, then it is crucial that young people are alerted early enough in their school life to the importance and attraction of technical routes.

However, it is disappointing that the Government have not been willing to accept Amendment 1 passed by your Lordships on Report. The decision to exclude apprenticeships from the category of approved education or training will serve as a deterrent to some young people, particularly those from disadvantaged backgrounds. The Minister for Apprenticeships and Skills said last week:

“The crucial point is that the vast majority of level 2 and 3 apprentices are paid more than £6.30 an hour, and 90% of them go on to jobs or additional education afterwards”.—[Official Report, Commons, 19/4/17; col. 714.]


But that is not the crucial point; in fact, he has missed the point. At least 90% of university graduates go on to jobs or additional education, so there is no difference in that respect. And whether apprentices earn £3.50 an hour—the legal minimum, which, as I said on Report, not all of them get—or £6.50 an hour, their parents are still disqualified from receiving child benefit. That is the nub of the issue. Clearly, though, we have not been successful in convincing Ministers of that point.

It was interesting to read last week of the Minister for Apprenticeships and Skills, in defence of the Government’s position, coming up with a figure of some £200 million a year by 2020-21. So apprentices—the young people we need to train in order to fill the skills gaps that we know exist—are to be treated unfavourably compared to their peers who choose full-time study because of the cost. The Government can miraculously find £500 million to create new grammar schools yet cannot find £200 million to ensure that the number of apprentices from the poorest families rises from its current very low level of just 10%. If there is logic in that policy stance, it escapes me. The noble Baroness, Lady Buscombe, said in Committee that she would discuss this issue with ministerial colleagues in the DWP. By Report there had been no such meetings, and we learned from the debate in the other place last week that those meetings have still not taken place. So where did the £200 million figure appear from, if not the DWP?

In passing, I say to the Minister that I submitted a Written Question asking for the Government’s workings that produced the £200 million figure. As I understand that those Questions disappear on Dissolution, I ask him to write to me with the answer so that we can gain an understanding of the foundation on which the Government have erected the barrier to treating apprentices as “approved learners”.

On Amendment 6, initially I was dismayed that the Government were unwilling to accept the will of your Lordships’ House on careers advice in further education colleges, although that was perhaps not too surprising as the Minister told us on Report that it was not necessary. However, the Government’s amendment in lieu actually appears to be stronger than the original amendment. First, it goes further than further education colleges and refers to “FE institutions”, which of course covers all training providers on the register.

Secondly, the original amendment in the name of the noble Lord, Lord Storey, which your Lordships’ House voted for at Report, called on Ofsted to “take into account” the careers advice made available to students by colleges. Government Amendment 6A states that Ofsted must,

“comment on the careers guidance provided to relevant students at the institution”.

For that reason, I welcome Amendment 6A, as Ofsted will be obliged to be proactive in reporting what it discovers in FE colleges that it inspects. That is certainly to be welcomed, although it comes with the caveat that it will apply only to those colleges that Ofsted actually inspects. How many will be? Realistically, how many can it be?

At Report, I asked the Minister to give an assurance that Ofsted would be adequately resourced; I fear that he did not reply. Mr Marsden asked the same question of the Minister for Apprenticeships and Skills, and he did not reply, so perhaps the Minister can now tell noble Lords how many additional staff Ofsted will have to enable it to inspect as many training providers as possible out of the 2,000 likely to emerge. It cannot do that with its existing staff, and we have a right to know what additional resources Ofsted will receive to enable it to cope with large new demands. I look forward to his response on that. I suggest that he must have one because it is surely inconceivable that he and/or his officials have not met Amanda Spielman or her deputy, Paul Joyce, to discuss the resources that they will require as a direct result of the Bill.

We are now at the end of a process that has produced the Bill, which will strengthen the sector but could have achieved much more. I thank all noble Lords who have participated in our debates, as well as Ministers, who have moved some way, if not as far as we would like, during our deliberations.

[Lord Storey (LD)]

My Lords, I shall speak to Amendment 6A. The Minister has put it better than I could, so I shall be very brief. I have always thought that the key to making the Bill successful was twofold. First, there was breaking the logjam of mainstream schools not allowing for or understanding the important role of technical education, whether it be FE colleges or university technical colleges. The acceptance of the amendment of the noble Lord, Lord Baker, was a crucial step forward. Secondly, there was careers. You can have all the courses in the world, but unless young people get a successful career at the end of it and an understanding of what is available to them, it is all for naught. I am delighted with the amendment. It sends a clear signal not only to the further education sector but to schools themselves. The explicit wording in the amendment means that there is no hiding place.

This is an important Bill, and I congratulate the Minister and his colleagues on carrying it through the Chamber in such a sympathetic way. I also thank the civil servants, who have been exemplary in the support that they have given us all. We could not wish for anything better. Finally, I thank my noble friend Lady Garden—she cannot be here—who led for my party on the Bill, and other colleagues who have supported us.

[Lord Baker of Dorking (Con)]

My Lords, I thank the noble Lord, Lord Watson of Invergowrie, for deciding not to press his amendments on this case. I know how strongly he feels about it, but it will be possible to revisit that after the whole principles of apprenticeships have been set up. I think that it is generally agreed by all sides of the House that this is an important Bill and a beneficial Bill. It is a major step forward in improving the technical education of our country. It has been handled very well by the Minister and his department, and we should speed it to the statute book.