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

Nusrat Ghani Excerpts

Report stage
Monday 31st March 2025 Commons Chamber

[Ian Sollom (St Neots and Mid Cambridgeshire) (LD)]

I beg to move, That the clause be read a Second time.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

With this it will be convenient to discuss the following:

New clause 2—Report on the impact on Higher Education—

“(1) Within one year of the passing of this Act, the Secretary of State must publish a report on the impact of this Act on the provision of degree apprenticeships in England.

(2) The Report must include an impact assessment of the removal of apprenticeship levy funding for degree apprenticeships.

(3) The report under subsection (1) must be laid before both Houses of Parliament.”

New clause 3—Report on the impact on T levels—

“(1) Within one year of the passing of this Act, the Secretary of State must publish a report on the impact of this Act on T-Levels.

(2) The report under subsection (1) must include—

(a) the involvement of Skills England in the administration of T Levels, including the curriculum and assessment methods;

(b) an assessment of the independence of the accreditation of T-Levels, specifically whether there has been any involvement of the Secretary of State in this process; and

(c) an assessment of the extent to which T-Levels are meeting local demand for skills.

(3) The report under subsection (1) must be laid before both Houses of Parliament.”

New clause 4—Creation of Skills England—

“(1) A body corporate known as Skills England is established to carry out the functions transferred to the Secretary of State under this Act.

(2) At the end of a year after the passing of this Act, the Secretary of State must make regulations transferring to Skills England all the functions transferred from the Institute for Apprenticeships and Technical Education under this Act.

(3) Nothing in this section prevents the Secretary of State from transferring more functions to Skills England under other enactments.”

This new clause would put Skills England on an independent statutory footing rather than as part of the DfE. The role of IfATE would be included in that planned for Skills England.

Amendment 4, in clause 4, page 2, line 6, at end insert—

“(3B) A group of persons under subsection (3) must include a representative from an organisation that is the representative body for a sector.”

Amendment 5, page 2, line 6, at end insert—

“(3B) When approving a standard under subsection (3), the Secretary of State must have regard to the reasonable requirements of—

(a) industry, commerce, finance, professions and other employers regarding education and training, and

(b) persons who may wish to undertake education and training.”

Amendment 3, in clause 5, page 2, line 32, at end insert—

“(6B) When approving a standard under subsection (6), the Secretary of State must have regard to the reasonable requirements of—

(a) industry, commerce, finance, professions and other employers regarding education and training, and

(b) persons who may wish to undertake education and training.”

Amendment 1, in clause 9, page 4, line 13, after “England” insert

“, including the impact of removing apprenticeship level funding for degree apprenticeships”.

Amendment 2, page 4, line 13, at end insert—

“(c) the impact of the exercise of the relevant functions on the provision of level 7 apprenticeships in England”

Amendment 6, in clause 12, page 5, line 6, leave out subsections (1) and (2) and insert—

“(1) This Act comes into force at the end of the period of one year beginning on the day on which Skills England is created.”

[Ian Sollom]

In considering the transfer of functions from the Institute for Apprenticeships and Technical Education, we face fundamental questions about the Government’s accountability and the future structure of our skills system. While modest in size, the Bill has far-reaching implications for that system, and for millions of learners and apprentices. It represents a significant centralising of power in the hands of the Secretary of State, without providing proper mechanisms for parliamentary oversight or accountability.

I have sat through many hours of debate on the Bill, during which Labour Members have extolled the virtues of Skills England, but let me emphasise again that the Bill does not actually establish that body, as many assumed that it would. It simply abolishes IfATE and transfers its functions to the Secretary of State, an approach that risks creating a governance vacuum in which there is no proper scrutiny or independent oversight. It is clear from the evidence received by the Bill Committee that I am not alone in having those concerns. The Association of Colleges, the Royal Society of Chemistry, the University of Winchester and the Institute of the Motor Industry all raised similar issues relating to governance and accountability in their written evidence submissions to the Committee.

As was noted by many on Second Reading, skills policy in this country has suffered from constant reorganisation and restructuring. The right hon. Member for East Hampshire (Damian Hinds) has reminded us several times that Skills England will be the 13th skills body to be established in 50 years. Given that history, employers, providers and learners desperately need stability and clarity. In its evidence, the University of Winchester warned:

“The transfer of power from IfATE to the Secretary of State for Education raises questions about the independence of the proposed Skills England regulatory body.”

It also observed that in IfATE, at present,

“employers and academics come together to ensure that the standard is industry relevant, current, and academically rigorous.”

The Skills Federation raised similar concerns:

“The clauses in the bill which transfer powers from IFATE to the Secretary of State risk shifting the development of standards further away from employer demand.”

It also said:

“Too much centralisation leads to a lack of focus on sector needs”.

--- Later in debate ---

[Ian Sollom]

There are different options, and I will come to this issue later. Given the scale of cross-departmental working required, having Skills England sit outside a single Government Department is probably more effective. Moreover, such bodies can be held accountable effectively by Parliament, as we have seen with some other quangos. Indeed, I believe the Industrial Strategy Advisory Council will be set up as a statutory independent body when time allows, and I suggest that Skills England is of the same order of magnitude.

Beyond the concerns about accountability and cross-Government authority, there are practical, operational risks to the approach laid out in the Bill. The Skills Federation warned in its evidence that

“there is a key risk that transfer of functions from IfATE will become the key focus for the set-up of Skills England and less attention (and potentially resources) placed on achieving the overarching aims.”

There is significant concern that the broader strategic purpose of Skills England could be lost in the rush to transfer operational functions. That concern was echoed by Lord Blunkett, who suggested that

“there is a real danger that IfATE will swamp Skills England at birth.”—[Official Report, House of Lords, 21 November 2024; Vol. 841, c. GC98.]

The Government’s impact assessment also acknowledges risks, noting that the transfer of functions could

“potentially cause a temporary slowdown in the growth rate of new apprenticeships and technical education courses due to potential delays in the approvals process”,

which

“may disproportionately impact disadvantaged learners.”

In Committee, the Minister emphasised the urgent need to address skills shortages and said that delay “is not an option.” Although we share the Government’s commitment to addressing skills shortages urgently, I respectfully suggest that there is wisdom in heeding the warning that the University of Warwick gave in its evidence. Getting the foundations right is more important than hasty construction.

In light of those concerns, I tabled new clause 1, which I proposed in Committee. It provides a constructive solution to many of the issues that I have outlined, and proposes a clear pathway for establishing Skills England as a dedicated executive agency within the Department for Education. As I said, my party ultimately believes that a fully independent statutory body with cross-departmental authority is the optimal approach, but we recognise the Government’s preference for the executive agency model, so new clause 1 works within that structure but provides essential safeguards. Under the new clause, the Secretary of State would produce draft proposals for establishing Skills England within six months, lay the proposals before both Houses, secure parliamentary approval before establishing the agency, provide annual statements on the agency’s work, and evaluate its effectiveness 12 months after establishment. This approach strikes the right balance between allowing the Government to implement policy at their desired speed and ensuring proper parliamentary scrutiny and meaningful stakeholder engagement.

As I said, I tabled new clause 1 in Committee because I believe that parliamentary scrutiny is essential for an organisation with such far-reaching responsibilities. The Minister argued that the standard accountability mechanisms for executive agencies are sufficient. However, I contend that Skills England is not just another executive agency; it is central to the Government’s economic growth mission and to creating opportunities for millions of people.

Standard executive agency protocols are built for “business as usual” functions, not for what should be transformative bodies at the heart of the Government’s economic strategy. Having a properly accountable Skills England, even as an executive agency, would ensure that employer voices remain central to standards development rather than being merely consultative; that technical expertise is maintained and developed across economic cycles; that Parliament maintains appropriate oversight for this critical area of policy; and, crucially, that political short-termism does not override long-term skills planning.

In Committee, the Minister argued against new clause 1 on several grounds. First, she suggested that it would cause unnecessary delay in addressing urgent skills challenges. Secondly, she pointed to the existing accountability mechanisms for executive agencies, including framework documents and reporting requirements. Thirdly, she emphasised that Skills England is already operating in shadow form and is poised to take these functions when the Bill passes. Let me address those concerns. On the issue of delay, new clause 1 would require reporting and parliamentary approval within six months—a reasonable timeframe that would not significantly impede progress. As the Skills Federation noted, proper planning for the transfer of functions is essential for success, and parliamentary scrutiny would reinforce, rather than impede, the effective delivery of Skills England.

The existing accountability mechanisms are indeed important, but they are surely insufficient for an organisation of Skills England’s significance. As the University of Winchester argued in its evidence to the Public Bill Committee, Skills England should be structured

“to ensure and protect its regulatory independence from Government and other agencies.”

The framework document and annual reports are important tools, but they are prepared by the Executive without any meaningful parliamentary input.

Skills England’s current shadow operations are welcome preparation, but operating in shadow form, without parliamentary scrutiny or approval, only underscores the need for new clause 1. Important decisions about structure, governance and priorities are being made right now, without any oversight in this place.

The Secretary of State indicated on Second Reading that the Government may review Skills England’s status in 18 to 24 months to consider whether it needs to be an independent statutory body, and the Minister confirmed that timetable in Committee. But why wait? Why create uncertainty about the future status of an organisation that needs to establish credibility with employers now? It is worth noting—as the shadow Minister, the hon. Member for Harborough, Oadby and Wigston (Neil O'Brien), did in Committee—that the Government plan to put the Industrial Strategy Advisory Council on a statutory footing “when parliamentary time allows”, according to their own documentation. This suggests that they recognise the value of key strategic bodies’ statutory independence, so why should Skills England be treated differently?

New clause 1 offers a constructive path forward, building on the debates we have already had. Personally, I was disappointed that the Government opposed it in Committee, but I believe that the case for proper parliamentary scrutiny remains compelling. Although my Liberal Democrat colleagues and I ultimately believe that a fully independent statutory body would be the ideal model for Skills England, new clause 1 would work within the Government’s executive agency framework to add essential parliamentary scrutiny and accountability.

The Minister assured us in Committee that Skills England will have robust governance arrangements and clear lines of accountability. If the Government truly believe in those principles, they should welcome rather than resist proper parliamentary oversight. If Skills England is to be the cornerstone of our skills system for years to come, even as an Executive agency with the Department for Education, we must ensure that it has the transparency, accountability and parliamentary oversight to withstand changes in political priorities and economic circumstances.

I urge Members across the House to support new clause 1, which would strengthen the Bill and help ensure that the transfer of functions leads to better outcomes for apprentices, students, employers and the economy as a whole.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call Pam Cox. Happy birthday! [Interruption.] Do you wish to contribute, or are you going to celebrate your birthday on the Back Benches?

[Pam Cox (Colchester) (Lab)]

Sorry, Madam Deputy Speaker; I was rather blown away by that. My birthday was actually on Saturday, but thank you so much.

It is a pleasure to speak in favour of this Bill, as a member of the Public Bill Committee and of the all-party parliamentary group on apprenticeships. The Bill is vital because it paves the way for the creation of Skills England, a new and ambitious body that will bring a fresh urgency to the task of upskilling our young people—and there is an urgency about this.

As the hon. Member for St Neots and Mid Cambridgeshire (Ian Sollom) said, Skills England will build on the extremely valuable work of the Institute for Apprenticeships and Technical Education, and I would like to pay tribute—

[Madam Deputy Speaker]

Order. Could you be seated for a moment? We are talking about the amendments to the Bill, not the overall Bill. The idea is to discuss the amendments and whether you disagree with them, but you need to bring your contribution in line with the debate this evening.

[Pam Cox]

Thank you, Madam Deputy Speaker. The issue is whether we should delay the introduction of this measure to allow more time to set up Skills England. A lot of preparatory work has already been done to set up Skills England, as we discussed quite fully in Committee, and we should get going on training up the carpenters, plumbers, electricians and other apprentices that we all know we need.

--- Later in debate ---

[Edward Morello]

rose—

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. Is the hon. Lady taking an intervention?

[Pam Cox]

I am sitting down.

[Madam Deputy Speaker]

Has the hon. Lady concluded her speech or is she taking an intervention?

[Pam Cox]

I have concluded.

--- Later in debate ---

[Janet Daby]

I beg to move, That the Bill be now read the Third time.

We are on a mission to deliver strong and sustainable economic growth and to break down the barriers to opportunity. Skills will power this mission-driven Government and our plan for change.

I thank Members across the House for their contributions. I especially thank members of the Bill Committee for their scrutiny; the hon. Member for Christchurch (Sir Christopher Chope) and my hon. Friend the Member for Sheffield Brightside and Hillsborough (Gill Furniss) for chairing the Committee; and my hon. Friends the Members for Newton Aycliffe and Spennymoor (Alan Strickland) and for Lewisham North (Vicky Foxcroft) for their crucial work in guiding the Bill through Committee and the other House of Commons stages.

The Bill has benefited from scrutiny both in this House and in the other place. I welcome the broad support for the creation of Skills England and its work. It is clear that we are united in our recognition of the need to develop a world-leading approach to skills. It is vital if we are to build the highly skilled workforce that we need to meet today’s challenges and grasp tomorrow’s opportunities.

We need skills to get Britain building; we need skills to deliver energy security; and we need skills to advance AI and increase productivity. We need to improve the quality and availability of training to give people from all backgrounds from across the country the power to seize opportunities and improve their lives and their family’s lives. That is why this Labour Government’s very first piece of education legislation will pave the way for Skills England.

According to employers, over one third of vacancies in 2022 were due to skills shortages. This must change. We need to move fast to identify and plug skills gaps in the economy. The Bill is a crucial step in delivering this change. Skills England will combine for the first time insight into skills gaps with the development of technical education to meet the gaps, and the network will ensure that skills needs can be tackled across the country. Skills England is already making a difference. It is changing the way skills gaps are identified and how key organisations are working together to fill them.

This Government are ready to go. As soon as the Bill passes, Skills England stands ready to take forward its work as a strong, coherent, single organisation. Delay is not an option. We must act and we will act. We are acting now. I commend the Bill to the House.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the shadow Minister.