Technical and Further Education Bill

Robert Halfon Excerpts

Money resolution: House of Commons & 2nd reading: House of Commons & Programme motion: House of Commons & Ways and Means resolution: House of Commons
Monday 14th November 2016 Commons Chamber

[Lucy Powell]

I apologise, Madam Deputy Speaker. I want to put it on the record that it was I who was speaking from a sedentary position. The Minister is indeed at the vanguard, but the only other discernible member of the Government is the Minister for the Armed Forces, who is standing behind the Speaker’s Chair.

[The Minister for Apprenticeships and Skills (Robert Halfon)]

May I make a quick point? As the debate has highlighted today, it is quality, not quantity, that counts.

[David Rutley]

Indeed.

The Bill is timely. After strenuous efforts to stabilise the economy following the financial crisis, the UK faces a new opportunity—and some challenges—in Brexit. If we are to make a success of leaving the EU, it is increasingly urgent that we tackle our long-standing productivity gap compared with other leading economies. The challenge is to upskill the existing and future British workforce. It is interesting that the Chartered Management Institute says that one in four jobs was left vacant in 2015, owing to skills shortages.

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[The Minister for Apprenticeships and Skills (Robert Halfon)]

I welcome the thoughtful contributions to the debate from Members on both sides of the House.

This important Bill has two purposes: to provide high-quality technical education to students; and, when colleges are suffering extreme financial difficulties, to provide clarity in the unlikely event of insolvency while protecting students as part of the process. The Bill has the protection and best interests of students at its heart, which is why David Hughes, the chief executive of the Association of Colleges, has stated that he is

“pleased that the Government is continuing to take forward the measures outlined in the Post-16 Skills Plan”.

The Bill is vital because we face serious challenges: a chronic shortage of high-skilled technicians; acute skills shortages in science, technology, engineering and maths; and low levels of literacy and numeracy compared with other OECD countries. A number of Members have raised an important issue about maths. We do not yet require all 17-year-olds who have not achieved an A to C in maths and English to resit the qualifications. Students who achieve lower than a D grade at 16 may take other qualifications. We are looking at functional skills. I want functional skills to be better and for them to be as prestigious to employers as other skills.

[Kelvin Hopkins]

rose—

[Robert Halfon]

I ask the hon. Gentleman to hold on one second, because he said that he wanted resources for maths, and we have invested £67 million to recruit up to 2,500 additional maths and physics teachers, and to upskill up to 15,000 non-specialists. We are investing the resources.

[Kelvin Hopkins]

rose—

[Robert Halfon]

I will not give way because of the shortage of time.

A number of hon. Members mentioned the Maynard reforms. We will implement those as soon as we possibly can, particularly with regard to the issue of maths for those with disabilities. We will inform the House as progress is made.

The hon. Member for Hove (Peter Kyle) talked about the levy and technology. The thing is that if companies have apprentices, they do not pay the levy, and they get 10% on top. This is about changing behaviour and raising money to fund millions of apprenticeships in our country.

We have substantially grown apprenticeships, with 619,000 starts, which is why we have the levy. It will have an impact on employers with a pay bill of £3 million or more and help to fund the quantity and quality of apprenticeship training. We are dramatically reducing the number of technical qualifications available, ensuring even better quality for students.

A lot has been said about FE funding, but by 2020 more will be spent on FE and skills participation than at any time in our island’s history—£3.4 billion in the year 2019-20. My hon. Friend the Member for Dover (Charlie Elphicke) correctly described FE as a ladder of opportunity for young people.[Official Report, 20 December 2016, Vol. 618, c. 11MC.]

We are adopting the Sainsbury report, as has been suggested, and will put in place 15 high-quality technical routes to skilled employment. Those will be implemented by the Institute for Apprenticeships and Technical Education, which will oversee the employer-led reforms.

We are proud of the university technical colleges. There is clearly a debate here, as some Members want those for pupils at 14 and some for education at 16. That debate will no doubt continue, but we allow flexible entry to UTCs in certain circumstances.

My hon. Friend the Member for Macclesfield (David Rutley) asked about the role of business. We have created the Careers & Enterprise Company to boost businesses’ linking up with students in schools.

The hon. Member for Wolverhampton South West (Rob Marris) talked about representation. I am very keen for all kinds of organisations to be represented. I am a trade union member myself, and I am very proud that this Government give Unionlearn £12 million. It has an incredible fund that supports thousands of learners and apprentices. I very much hope that trade unions will be involved in the Institute for Apprenticeships and Technical Education. The institute will ensure that all technical provision, across both apprenticeships and college-based courses, matches the very best in the world.

[Rob Marris]

Will the Minister give way?

[Robert Halfon]

I am sorry, but we have very little time.

[Rob Marris]

On a point of order, Madam Deputy Speaker. The Order Paper I have says that this debate can continue until 10 pm. Am I misreading it?

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[Madam Deputy Speaker]

Mr Hunt is excited at the prospect of another three hours from the Minister, but it is incumbent on every Member of this House to judge the mood of the House, the pace of the debate and the necessity of taking up the time of the House. From my observation and experience, a speech of between 10 and 15 minutes from a Minister winding up is usually appropriate and welcomed by most Members of the House.

[Robert Halfon]

The hon. Gentleman and other Opposition Members talked about quality, not quantity. They should practise what they preach.

Let me give an example of the technical education reforms in practice. For someone aspiring to be an engineer, rather than choosing from the 500 qualifications that are currently on offer, many of which hold very little value for employers, there will be one clear route: the new engineering and manufacturing route. That individual will choose an apprenticeship or college-based technical education course by choosing an occupation. They will initially learn a broad base of knowledge based on one approved standard per occupation, and then they will specialise, for example towards electrical engineering. The awarded certificate will be universally recognised and have real value for employers. That is an example of the nature of our technical reforms.

There is no doubt that FE and sixth-form colleges play a vital role in our education system, as the hon. Member for Scunthorpe (Nic Dakin) noted so brilliantly. That is why I have visited my own FE college more than 50 times since becoming an MP. FE colleges act as genuine centres of expertise. We know that, because 80% of colleges are either good or outstanding, and 79% of adult FE students get jobs, move to apprenticeships or progress to university afterwards. It is worth noting that 59% of institutions are in good financial health and 52% are operating with a surplus.

A minority of colleges, however, are in serious financial difficulties—about 40 colleges face these problems. In supporting these colleges, we forecast by March 2017 a total spend of £140 million on exceptional financial support. That £140 million could have been invested in students. We have to deal with the roots of these problems and ensure that we protect students, which was why we started the area reviews, about which there has been much discussion. They will be completed by March 2017 and will ensure financial resilience, strong leadership and well-governed institutions. We have a moral duty to students that money is spent on learning, and a duty to deliver value for money for the taxpayer. Money that would otherwise be spent servicing debt will be freed up to invest in high-quality education and learning.

[Jo Churchill]

Will the Minister give way for a brief intervention?

[Robert Halfon]

I am very sorry, but I cannot because of time, even to my hon. Friend. I apologise.

Let me be clear: no FE or sixth-form college will close as a direct result of the Bill. The Bill will help to ensure prudent borrowing and lending, and to safeguard the protection of students.

The insolvency regime under the Bill will clarify what will happen should a college become insolvent. The special administrative regime we are introducing will allow Ministers to take action to ensure that learners are protected. There will be duties on the Secretary of State to promote education, and to provide suitable apprenticeship training and basic skills training for certain people. All existing statutory requirements will stay in place. Local authorities are also legally responsible for promoting effective participation and making clear how transport arrangements support young people of sixth-form age to access opportunities. That is not to say, however, that creditors are not important. Colleges and banks have long worked together to grow and develop the FE sector. The Bill will introduce a clear process for all involved should a college become insolvent, and will reassure creditors about how their debt will be treated.

The reforms in the Bill are fundamental to the Government’s vision for a country that works for everyone. It will ensure that we improve the skills base in our country, that we increase our economic productivity, that we protect students, and that those from the most disadvantaged backgrounds have a chance to climb up the ladder of opportunity. I commend the Bill to the House.

Question put and agreed to.

Bill accordingly read a Second time.

Technical and Further Education Bill (Programme)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),

That the following provisions shall apply to the Technical and Further Education Bill:

Committal

1. The Bill shall be committed to a Public Bill Committee.

Proceedings in Public Bill Committee

2. Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Tuesday 6 December 2016.

3. The Public Bill Committee shall have leave to sit twice on the first day on which it meets.

Proceedings on Consideration and up to and including Third Reading

4. Proceedings on Consideration and the proceedings in legislative grand committee shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which those proceedings are commenced.

5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.

6. Standing Order No. 83B (Programming committees) shall not apply to proceedings on Consideration and up to and including Third Reading.

Other proceedings

7. Any other proceedings on the Bill (including any proceedings on consideration of Lords Amendments or on any further messages from the Lords) may be programmed.—(Heather Wheeler.)

Question agreed to.

Technical and Further Education Bill (Money)

Queen’s recommendation signified.

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),

That, for the purposes of any Act resulting from the Technical and Further Education Bill, it is expedient to authorise the payment out of money provided by Parliament of—

(1) any expenditure incurred under or by virtue of the Act by the Secretary of State, and

(2) any increase attributable to the Act in the sums payable under any other Act out of money so provided.—(Heather Wheeler.)

Question agreed to.

Technical and Further Education Bill (Ways and Means)

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),

That, for the purposes of any Act resulting from the Technical and Further Education Bill, it is expedient to authorise—

(1) the charging of fees, and

(2) the payment of sums into the Consolidated Fund.—(Heather Wheeler.)

Question agreed to.

Homelessness Reduction Bill (Money)

Queen’s recommendation signified.

Resolved,

That, for the purposes of any Act resulting from the Homelessness Reduction Bill, it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to the Act in the sums payable under any other Act out of money so provided.—(Mr Marcus Jones.)

Technical and Further Education Bill (Third sitting)

Robert Halfon Excerpts

Committee Debate: 3rd sitting: House of Commons
Thursday 24th November 2016 Public Bill Committees

[The Chair]

Obviously that is not a matter for the Chair. However, the point has been made and I invite the Minister, if he wishes to respond, to do so.

[The Minister for Apprenticeships and Skills (Robert Halfon)]

Thank you, Mr Bailey—

[Kelvin Hopkins (Luton North) (Lab)]

rose—

[Kelvin Hopkins]

It is further to that point of order, Mr Bailey. I just want to support my hon. Friend the Member for Blackpool South. I arrived at the House fairly recently and picked up the paper from my office, but I have not had time to read it, and it is clearly lengthy. I entirely support what he said and hope that the Minister will be accommodating.

[Robert Halfon]

The existing policy statement has already been on the gov.uk website for several weeks, as has the delegated powers memorandum. What was provided last night was an expanded refresh, but we have provided information on the policy, and that is the key point.

[Gordon Marsden]

I appreciate what the Minister says about the original version having been on the website, but the point is that this is not the original but an expanded version. He used the word “refresh”, which, if I may say so, politely, is another slightly slippery term that would be best avoided. This is actually an amended version of what was on the website, which is why we are raising the issue.

We broadly support the principles of the Bill. We are trying to take it forward and do due diligence, as all members of the Committee should want to do. This is not a partisan argument or an opportunity to score points; it is about treating the Committee with the respect it deserves. Hon. Members received a significantly amended version of the policy statement at 5 o’clock last night, without having had any prior indication. I return to my point, which the Minister has not answered: why could this document not have been circulated on Tuesday? Why was it left until 5 o’clock on a Wednesday evening, when many hon. Members perhaps were not looking at, or were unable to look at, their emails? The Minister has heard already that my hon. Friend the Member for Luton North has picked his up only this morning. Frankly, if we want to proceed in a co-operative and friendly way in the Committee, this is no way to run a railway.

[Gordon Marsden]

I understand the hon. Gentleman’s point, and I assume that most of the time these things come about—if I am not using unparliamentary language—as a result of a cock-up, rather than a conspiracy. For the sake of Hansard, I stress that I am not saying that that was the case here. What I am saying is that it was not terribly helpful that the document turned up at only 5 o’clock last night. I understand that these issues are quite complex. I might add in passing, however, that some of the discussion in this sitting will be about capacity, and if the Minister’s Department did not have the capacity to produce this very important document by Tuesday, that will raise concerns about its capacity to do some of the other things that it needs to do in relation to the Bill.

I am not asking that the document not be looked at. I entirely accept the point made by the hon. Member for North West Cambridgeshire that these things happen, but in the circumstances I think it not unreasonable to ask that hon. Members on both sides of the Committee, who might want to look at some of these issues, should have the opportunity to table amendments in the light of this policy statement. I remind those on the Government Front Bench that clause 1 and schedule 1 deal with most if not all of the meat of the establishment of this new institution, and we should get that right.

[Robert Halfon]

I will just say one final word on the matter. It is important to note that this is existing material. Most of it is already in the public domain—in the Sainsbury report and the explanatory notes. We did not publish it on Tuesday because we wanted to be able to digest the oral evidence session. There is no conspiracy. We were just trying to be helpful to the Committee by ensuring that there was a fuller note on the matter.

[Gordon Marsden]

I entirely accept the Minister’s explanation. It is unfortunate that we are in this situation, but I am asking whether, under the circumstances, we will be able to move amendments to clause 1 and schedule 1 by manuscript or on a starred basis at the beginning of next week.

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[The Chair]

The situation is that Members can table amendments if the Committee has not moved on, but if schedule 1 has been taken, they cannot. I call the Minister.

[Robert Halfon]

The policy document does not change anything. As I say, most of it was already in the public domain and we were just trying to help the Committee. We are here to debate the clause and schedule relevant to the issue in hand.

[The Chair]

I will move on to some preliminary announcements. Today we begin line-by-line consideration of the Bill. Members may remove their jackets during Committee meetings. Please ensure that all electronic devices are turned off or switched to silent mode.

The selection list for today’s sittings is available in the room and shows how the selected amendments have been grouped for debate. Grouped amendments are generally on the same or similar issues. The Member who has put their name to the leading amendment in a group will be called first. Other Members will then be free to catch my eye and speak to all or any of the amendments in that group. A Member may speak more than once in a debate. I will work on the assumption that the Minister wishes the Committee to reach a decision on all Government amendments.

Please note that decisions on amendments take place not in the order in which amendments are debated, but in the order in which they appear on the amendment paper. In other words, debate occurs according to the selection list and decisions are taken when we come to the clause that the amendment affects. I hope that explanation is helpful. I will use my discretion to decide whether to allow a separate stand part debate on individual clauses and schedules following the debates on the relevant amendments. If any Member wishes to make a declaration of interest, he or she may do so at this point.

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[Robert Halfon]

It is a pleasure to serve under your chairmanship, Mr Bailey. I am very pleased to be here this morning to begin line-by-line consideration of this important Bill. I look forward to debating it with all members of the Committee. I particularly want to convey my thanks to Lord Sainsbury and his Independent Panel on Technical Education for the excellent work that they have done on technical education, which we are now taking forward through the post-16 skills plan in the Bill.

I want to pay significant tribute to my predecessor, my hon. Friend the Member for Grantham and Stamford (Nick Boles), who has been recovering from a serious illness. It was good to see him in the House recently. I want to thank everyone who has taken time to serve on the Committee, and I thank you, Mr Bailey, and Ms Dorries for serving as chairpersons. I thank those who gave oral evidence on Tuesday this week and those who have already submitted written evidence; their expert contribution has got us off to a great start.

Turning to part 1 of the Bill, clause 1 seeks to amend the name of the Institute for Apprenticeships to reflect its wider responsibility for college-based technical education. The Enterprise Act 2016 will establish the Institute for Apprenticeships. The institute is expected to come into operation in April 2017 with apprenticeship functions. The clause, together with schedule 1, will extend the institute’s remit to reflect the Government’s vision for the skills system set out in the post-16 plan.

The reforms will result in technical education qualifications that are designed around employers’ needs. They will support young people and adults to secure sustained employment and will meet the needs of our rapidly changing economy. Measures to extend the institute’s remit are important for a number of reasons. As a country, we face a pressing need for more highly skilled people, yet the current system presents a bewildering array of overlapping qualifications with similar aims. We cannot continue to let so many of our young people work their way through a succession of low-level, low-value qualifications that lead at best to low-skilled, low-paid employment.

The Bill will give the Institute for Apprenticeships and Technical Education responsibility for approving high-quality technical qualifications that develop the skills, knowledge and behaviours required by employers for skilled employment. Apprenticeships and college-based technical education courses will be based on a common set of employer-developed standards. This will ensure consistency between the two methods of obtaining a technical education.

Securing a step change in technical education is vital for the productivity of this country. By 2020—we are open and honest about this—the UK is set to fall to 28th out of 33 OECD countries in terms of developing intermediate skills. The size of the post-secondary technical sector in England is extremely small by international standards. That affects our productivity, where we lag behind competitors such as Germany and France by as much as 36%. Unless we take action, we will be left further behind.

A high-quality skills system needs to be distinct from the academic option. Academic qualifications such as A-levels are clearly understood, yet most young people do not go to university. Evidence shows that technical qualifications have long been regarded as inferior to academic qualifications. Reforming the system so that it provides a clear line of sight to the world of work will ensure that technical education in this country is valued as equally as the academic option.

The reformed technical education system will be built around a clear framework of skilled occupations. Occupational maps will be used to identify the occupations that are suitable for technical education, grouping together those with similar requirements, designing the system around clearly identifiable occupations, and bringing together employers to identify the skills and knowledge needed for those occupations. They will ensure that the new system genuinely meets the needs of individuals, employers and the economy.

It is important that a single organisation is responsible for working with employers and is the custodian of employer-led standards. Giving the institute responsibility at the heart of these reforms will ensure that all technical education provision is closely aligned and of the same high quality. We will ensure that the institute has the skills and capacity to be responsible for technical education when its remit is extended in April 2018. It is right that the institute’s name is changed to reflect the wider scope of its responsibilities.

[Gordon Marsden]

I associate myself with the Minister’s kind words about his predecessor, the hon. Member for Grantham and Stamford. It is a great pleasure to serve under your chairmanship, Mr Bailey, and that of Ms Dorries. I appreciate that this is quite a technical and detailed Bill, so we will depend upon the skills of the Clerks and hopefully timely policy submissions from the Government to wade our way through it.

The Minister rightly spoke about the broad need for the institute. He talked frankly about the situation in terms of technical skills, which was alluded to recently by the noble Baroness Wolf. It is absolutely right that we have the Institute for Apprenticeships and Technical Education—I do not know whether we are going to have to state that in full all the way through, or perhaps we can use the acronym; I assume the “E” will not be silent. I shall not detain the Committee with the story of why one Government had to change the title of a higher education and lifelong learning department; Members can think about that acronym.

[Robert Halfon]

On a point of order, Mr Bailey. To help the Committee, IFATE is a perfectly acceptable description of the institute during the debate.

[Gordon Marsden]

Great. I shall use it with relish.

We are very much in favour of the establishment of IFATE. We were very much in favour of the establishment of the Institute for Apprenticeships—so much so, in fact, that we anticipated the Government in tabling a clause in which, with our limited capacity as opposed to the civil service’s, we tried to spell out what that institute should do. I make that point to issue a caution to the Minister. He is still relatively new to his post, but not to this field; he has a distinguished record in championing apprenticeships, both in person and in policy. I am entirely confident that the principle of everything he has said today is very close to his heart—it is not always close to every Minister’s heart, but I think it is in his case—and that he will do his best to take that through.

We did not oppose the Bill’s Second Reading, not simply because of the Minister’s personal qualities but also because we believe there is a great deal of good in the Bill. However, the devil is in the detail, and the detail that causes us significant concern, and to which my hon. Friend the shadow Secretary of State referred on Second Reading, is the fact that we come to the Bill and to this new institution with a great deal of rather confused and not very comforting baggage.

I remind the Committee that when the Enterprise Bill was originally going through the House of Lords, where it started, there was no concept of an Institute for Apprenticeships at all. If Members consult the Hansard report of the House of Lords debates, they will see that there was much discussion on the Government Front Bench as to how the whole issue of standards could be developed. At one stage, a Government spokesperson suggested—whether accurately or otherwise I do not know—that some of it might be the province of trading standards officers. I think most Members here who know the way in which local government has had its trading standards officers cut back in recent years would agree that that is probably an over-optimistic assessment.

In due course the Government decided that they needed to set up an arm’s length body, which is why, at a relatively late stage during the Commons debate on the Enterprise Bill—I think it was on Report; I might be wrong—the then Minister, the right hon. Member for Broxtowe (Anna Soubry), tabled an amendment to that effect, which we then debated in Committee. As I said, the Government on that occasion had not got their act together to put a clause down establishing it in the Bill, so we put one down and we discussed it.

I know that no Government like to take anybody else’s idea, but we were rather disappointed that, when the Bill eventually came out, it was a fairly standard boilerplate structure, if I can put it that way, for setting up any institution of this sort. As we know, this is an innovation that potentially takes quite a lot of working responsibilities away from the Department for Education and the Skills Funding Agency. I think we are now back in the sort of territory that we were in during the Committee stage of the Higher Education and Research Bill. The Minister I faced then was the Minister for Universities, Science, Research and Innovation, but we had exactly the same conversations in that Committee about the appropriateness of a Bill that established the office for students but did not mandate students to go on to that body. I feel a sense of déjà vu, because we are in exactly the same place with this Bill. We will return to the detail of that amendment in due course, but I mention it now only to illustrate the lack of connectivity that there seems to have been, and the relatively late stage at which guidelines for the Institute for Apprenticeships have been produced.

Hon. Members might also remember that the skills plan was originally intended to be in the Government’s academies mark 2 Bill. It disappeared from that Bill at a relatively late stage, when the Government realised that that Bill would be too hot to handle with their Back Benchers. We then had the rather strange situation, again at the very last minute, in which a Government statement about introducing the Bill and laying out its provisions had a little bit tucked in the middle saying, “Oh, by the way, we’ve decided we don’t have to go ahead with the academies issue.” I am not here to talk about academies, but I mention that example because it is illustrative. The hon. Member for North West Cambridgeshire spoke earlier about things that go wrong in Government. It is illustrative of the fact that the Government felt, at a relatively late stage—largely because of their embarrassment over that Bill, some observers believe—that this set of changes, which we welcome, should have separate legislation.

Whatever the reasons for that, we welcome it now, although I will gently say that it would have been better to have been able to discuss some of this in more detail, and possibly to have the Institute for Apprenticeships itself incorporated in the Higher Education and Research Bill. During the passage of that Bill, as the Government Whip will well remember, the Minister for Universities and Research spoke at length about the importance of higher level skills and everything that went with that, so it seems rather bizarre to some of us that this did not go into that Bill in the first place. We will not dwell on that.

What we want and need to dwell on are the issues relating to capacity. Capacity and time in terms of establishment have plagued the Government ever since discussions about the skills plan and the apprenticeship levy started. Sector skills council after sector skills council, employer bodies and providers have all had queasiness about the apprenticeship levy. We, too, support the levy, but we share some of the severe concerns about its implementation. A long list of organisations, including the Confederation of British Industry and the Federation of Small Businesses, have expressed and continue to feel concern about timing and capacity.

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[Kelvin Hopkins]

Thank you, Mr Bailey. I was aware that I was straying from the subject. As I said, I taught in further education myself. I have taught a small number of day-release students as well, mainly A-levels in economics, politics and statistics. My experience was not very long—three years or so—but it was a great experience that has coloured my politics ever since. I know the difficulties of training young people.

Another problem that we have had is that, because of the reduction in employer size, there are fewer employees, and it is harder for a small employer to sustain an apprentice without a proper levy system with heavy state subsidy. I think that the levy system is exactly right; I would like it to be more extensive, so that we can give apprentices secure employment with reasonable pay, while they are working and studying. Apprenticeships across the board need to be properly sustained financially and a levy system is the way forward. We are moving in that direction.

I have come across another problem. Small garages, for example, might take on an apprentice as a car mechanic, who might stay there for three years, but then that small garage might suddenly find that its apprentice has been poached by a big garage that does insurance work, which would be very lucrative and much more highly paid. The small garage loses out because it has put a lot of work and finance into training somebody who has been lost to a bigger employer. We ought to be training more people and giving more security to small employers to ensure that they can sustain an apprentice with similar and appropriate pay for a longer period.

There is a lot for the institute to address. I welcome the fact that we are moving in the right direction, but we must ensure that apprenticeships are high quality and secure, not just because our young people should have the right to good training, education and skills, but because our country and its economy needs those people to do well.

[Robert Halfon]

I could listen to the hon. Member for Luton North for a long time on this subject, because he speaks with a lot of wisdom. I have been to the north-east of England to see young people on five-year apprenticeships in companies, doing exactly the things that he talks about.

I will just say that the public and private sectors will be following the same standards. We have exactly the same standards on training and quality, and we are introducing a public sector target from April 2017 in all areas to increase the number of apprenticeships in the public sector: 30,000 by 2020.

I will respond to the points made by the hon. Member for Blackpool South. He is kind about me and it is good to be opposing someone who also cares passionately. I very much enjoyed the visit to Blackpool and the Fylde College. What it is doing is extraordinary, not just for students but for the long-term unemployed.

I will comment on a few things, given that we are about to discuss amendments. The hon. Gentleman said that the levy was an administrative challenge for the IFA. It is important that it has only an advisory role on funding caps. The implementation of the levy is for the Department and the Skills Funding Agency.

The hon. Gentleman talked about the apprenticeship target and how difficult it was. It is worth remembering that there have been 624,000 apprentice starts since May 2015. We have 899,400 apprenticeship participations in the 2015-16 year. That is the highest number on record. Of course, it is a challenge to reach a 3 million target, but we are on the way.

[Gordon Marsden]

The Minister is right to point to progress so far and I do not want to disparage that. He reminds us that implementation is for the Department and the Skills Funding Agency. I am well aware, of course, that David Hill, who is an extremely talented and assiduous civil servant, has been seconded to do precisely that as director of apprenticeships. I was puzzled, however, that the Minister made no reference to the Apprenticeship Delivery Board. I will not go into whether it will have tsars or not; that is for others to decide and the Minister to ponder.

When that board was announced, it was advertised as being a key part of the process of encouraging and driving up the numbers. It was not simply to be a bully pulpit, but it was to have a very direct and active role. Yet since the hon. Member for Stratford-on-Avon (Nadhim Zahawi) stood down from that post, we seem to have heard very little out of the board. What is its role?

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[Gordon Marsden]

I am duly rebuked, Mr Bailey.

[Robert Halfon]

I reassure the hon. Gentleman that the Apprenticeship Delivery Board is in full flow. I meet it and its chairman regularly. It goes up and down the country and works with businesses to encourage them to employ apprentices. Much of our success has been because of that board’s incredible work.

On frameworks and standards, the hon. Gentleman will know that 25% of frameworks will be gone by the end of this year. The 400 standards support around 340,000 apprenticeships. We hope by the end of the Parliament to have moved entirely from frameworks to standards. That is our target. As he knows, the standards will be determined by occupational maps based on labour market evidence and information about employer demand. We do not want to set an upper limit, because we need flexibility to respond to the economy. It will be up to the IFATE to plan the timescales for the review of those standards.

[Gordon Marsden]

Will the Minister give way?

[Robert Halfon]

I want to get to the amendments, and no doubt the hon. Gentleman will bring some of these things up again at some point, so will he allow me to answer the questions?

The hon. Gentleman asks us to sign a blank cheque on IFA capacity. We are consulting on the Secretary of State’s strategic guidance letter to the IFA. The IFA’s shadow board will publish a draft operational plan. The hon. Gentleman is right that Peter Lauener, the shadow chief executive, is excellent. He has been working with Antony Jenkins, who is the shadow chair. The shadow IFA is working hard to get the institute’s operational plan up and running by April 2017, and that plan will be published soon. Progress is being made, and the institute will be set up in April 2017.

As the hon. Gentleman knows, the institute’s board and chair are being appointed. There are 60 core staff. The IFA will draw on many more people through engagement with employer panels, experts and more than 1,000 employees, so the IFA does have the necessary capacity. We are doing this carefully. The technical education bit will start a year later; the first course on the new route will start in 2019. We are doing everything that he wants. The institute has the necessary capacity, and we have the right people and board to run it.

On occupations not included in the 15 routes, if the hon. Gentleman remembers, the principal of his college said in the evidence session that it was possible to do different things, such as sports, through the academic route and applied general qualifications. We are not closing the door on those things, but 15 is regarded as the right number. We have analysed the labour market, and I think that it is right to have those 15 routes, which are, in essence, what our economy needs. On that basis, I believe that the expanded institute is the right body to be at the heart of the reforms—we are implementing the Sainsbury reforms—and the Government are committed to ensuring that the institute plays that role. Clause 1 should therefore stand part of the Bill.

[Tracy Brabin (Batley and Spen) (Lab)]

It has been interesting to listen to the Minister. I have one quick question. How will the nearly 900,000 apprentices currently on courses be channelled into those routes? If they are in retail, for which a route does not currently exist, what will happen to their course?

[Robert Halfon]

Current apprentices in the existing frameworks will not be affected. This will only be for new apprentices. Standards are being brought through, but people in the existing frameworks will not be affected by the changes.

Technical and Further Education Bill (Fourth sitting)

Robert Halfon Excerpts

Committee Debate: 4th sitting: House of Commons
Thursday 24th November 2016 Public Bill Committees

[Kelvin Hopkins]

It is a pleasure to see you in the Chair again this afternoon, Ms Dorries. I strongly support the amendments tabled by my hon. Friend the Member for Blackpool South and the case he made for them. I am also sympathetic to what the hon. Member for North Swindon said.

I have some knowledge of these issues. In general, it is so important for all citizens to have a sense of worth, and having some form of education or having a job gives us that. Without that sense of worth, we can become not only alienated and miserable, but difficult people in society. All sorts of problems arise when people do not have a proper role in society. Even if one has disabilities, to be able to have a real role among one’s fellow human beings is so important.

I particularly wish to discuss adults with moderate learning difficulties. Some 15 years ago or so, a friend invited me to speak to a class of young adults with moderate learning difficulties at my local college. I spoke fairly briefly about politics and about what I did and then they asked questions. I have to say that I could not answer the first two questions, which were very perceptive and intelligent. One was about benefits—they were very conscious about benefits and the rules governing them. I was not up to speed on that, so I was in difficulty there. The young man’s second question was why Tony Blair had abandoned socialism. I have to say that on both counts I was completely floored. I had to say that I could not speak for the Prime Minister, but that I had not abandoned socialism.

That experience showed me that these young adults were not daft. They had things to say and they had an understanding of the world. With the right courses and, if possible, the right apprenticeships, they could find some employment at some point. For example, recently, in one of our supermarkets, the young man who collects the trolleys and pushes them to the collection points for customers has moderate learning difficulties, but he has a job; he is a character; everyone knows him and he is happy. We ought to organise the world so that such things can happen.

Amendments such as the one tabled by my hon. Friend the Member for Blackpool South ought to be on the face of every Bill relating to education, training and employment, so that it becomes deeply embedded in our culture. Some employers and teachers, although they would not necessarily discriminate wittingly, might do so unwittingly without such things in their mind. They need to be aware that they must be fair and provide equal opportunities. Some employers are notorious for discriminating against women. That is changing, but we still have some way to go to ensure that women have equal shares with men. We do not have equal pay yet.

We have also talked about minority ethnic communities. Again, it is particularly those who are unemployed and live in poorer areas who sometimes get into difficulty or trouble. If they had jobs, it might be different. There was a time in my own town when anybody could literally knock on the door at Vauxhall and get a job. It might not be a very skilled job, but they could get one.

On the difficulties on the streets, an interesting statistic featured in The Guardian some years ago: when unemployment rose to 3 million in the early 1980s, street disorder and street crime took off like a rocket. It is not surprising. All those young men whose energy would have been absorbed putting wheels on cars or doing whatever they would have been doing were on the streets, with nothing better to do than cause trouble. I have always been a passionate believer in organising society to ensure full employment. Some years ago, I was chair of a Back-Bench group with outside members called the Full Employment Forum, started by the renowned Bryan Gould, one of the leading Labour politicians, who is still a friend.

On looked-after children, I said in an intervention that it is important for them to be given extra advantage, because they have had disadvantages in early life. Perhaps their education has been disrupted by their being absent from school, moving house or being generally disturbed and unhappy in education, but they might have abilities way beyond the level of education that they received, so it is important that they are given an extra boost through an apprenticeship or a college education. Providing them with security, hope for the future and a stable and predictable environment in life is important to giving them a sense of optimism and increase their self-worth.

I think these two amendments should, in one form or another, be made. I hope that at some point—maybe today, or maybe not—such amendments can be incorporated into the Bill in its final form. I am happy to support them, and I congratulate my hon. Friend on moving them.

[The Minister for Apprenticeships and Skills (Robert Halfon)]

It is a pleasure to serve under your chairmanship, Ms Dorries. I will respond to some of the issues raised. The hon. Member for Batley and Spen talked about careers guidance in schools, and I agree with her. The first ever speech that I made in the House of Common was about the problem of careers guidance in schools not encouraging people to do technical education or apprenticeships. We must consider the issue holistically, from primary school all the way through. Although it is not part of the Bill, I am considering from the start how we deal with the issue.

That said, we are investing £90 million in careers. The Careers & Enterprise Company has 1,190 enterprise advisers and a £5 million careers and enterprise fund. I have seen myself how they go into schools to boost provision on technical education and apprenticeships, to encourage work experience and to build links between businesses and schools. There is also a separate £12 million mentoring fund, which I am very keen on.

--- Later in debate ---

[Gordon Marsden]

I beg to move amendment 11, in schedule 1, page 22, line 14, at end insert

“following consultation with institutions, students and employers, and their representatives”.

This amendment would ensure that the Government must consult with institutions, students and employers, and their representatives before making changes to the “occupational categories” or “routes”.

The amendment would ensure that the Government consult with institutions, students, employers and their representatives before making changes to the occupational categories or routes. You were not with us this morning, Ms Dorries, but we had quite a detailed discussion around occupational categories and routes, so I will try not to repeat the arguments that we had—people can read them in Hansard.

If there are concerns and controversies about the different routes—for instance, about whether the service sector is adequately represented in the existing routes—that gives even more force to the argument that there should be as broad a consultative and collaborative process as possible. It should not hold up the processes; I am conscious that consultations can go on and on endlessly.

As it stands, the Bill enables the Secretary of State to propose categories for those routes without any further input. It simply requires the Secretary of State to notify the IFA of any changes. I say to the Minister what I said to his counterpart on the Higher Education and Research Bill: although I genuinely have every confidence in his wish to consult, and, for that matter, in the Secretary of State’s wish to consult, we are setting down legislation that will last for a significant number of years, so we have to be careful that we do not hook everything on to the whim of a Secretary of State. After all—we made this argument about the Higher Education and Research Bill—if a new institution is to succeed, it has to have the active and enthusiastic participation of as many of the people who are affected by it as possible. A consultation with institutions, students, employers and their representatives is a necessary part of the process.

A further point is that there is a balance to be struck —the Minister will be well aware of this, because it is a continuing and intensifying debate—between the bespoke skills that are needed for immediate jobs and the enabling skills for more generic future employment. There will always be a tension between the needs of an employer and the needs of an employee—they might be a student or an apprentice—in whichever skills area. After all, in the 21st century we will not all have, as my father was promised before the second world war, a job for life.

We will probably see young people who—I am sure we have all used this phrase, one way or another—do five careers during their lifetime, two of which have not yet been thought of. It is therefore even more important that we have that broad process of ongoing consultation about how generic, as opposed to bespoke, skills should be, so that not only do we get the skills that we need for the future, but young people and adults wanting to return to work or start a new career get the skills that they need.

[Robert Halfon]

I welcome the opportunity to debate the amendment, and understand why Opposition Members support it. It is important to understand the purpose of occupational categories, which we refer to as routes in the technical education reforms we are putting in place, and how they relate to the overall system we are developing. The routes are the main ways that learners will find their way around the new system. They provide clear and accurate signposts to the new qualifications.

Lord Sainsbury’s report proposed a system that has

“employer-designed standards...at its heart”,

which is what we have created. He urged that there be a common framework of standards, covering both apprenticeships and college-based provision. Those standards are the basis of the new technical education system we have created. In essence, the standards are the knowledge, skills and behaviours required to perform the occupation.

Presentationally, it does not help to have hundreds of different standards, completely distinct from one another. It is better to group them together to make it easier for people to understand how to navigate through the system. The routes give us a mechanism to do that. I shall not go through it again, but on Second Reading I set out how, if someone went down the engineering route, that would be reflected if they then chose a different branch of engineering.

Earlier, we discussed best practice overseas—I think the hon. Member for Luton North mentioned it—and our system does reflect international best practice. It was reviewed with employers, academics and professional bodies as the Sainsbury panel developed its proposals. The routes are each based on evidence-based occupational maps, on which we have to consult widely. The institute will take on board a wide range of views when developing the occupational mapping, which will then feed into the shape of the routes. It will have to help to ensure that the routes are aligned with the needs of the economy and the industrial strategy, so that young people and adults can make the choices they need to make when they move into skilled technical occupations.

Route panels—panels of professionals—and employers have been consulted to ensure that the institute gets it right, so it is not necessary to consult on the routes separately. Nevertheless, there will of course be an ongoing need to keep the route structure under review—it is flexible—and to continue to listen to the feedback from stakeholders. In view of that, I hope that the hon. Gentleman will feel reassured enough to withdraw the amendment.

[Gordon Marsden]

I thank the Minister for that explanation, which is helpful. I hear what he says, but I am still not entirely reassured. I understand the process; indeed, I understand the process laid out by Lord Sainsbury in the skills plan. The point I was trying to make, and to which I referred this morning when I discussed the responses from the Association of Employment and Learning Providers and various others, is that there remains considerable unease—I will put it no more strongly than that—about whether the routes cover a large enough area of the skills or sectors we will need for the future. That is separate from the issue I raised about enabling skills.

I am not rubbishing the existing routes at all, but the matter needs to be thought about and watched very carefully. I can understand what the Minister is saying about not having everything chopped into silos, but I would not want him to think that certain areas, particularly the service sector, can be ignored just because he has been told that this is the route to follow. Nevertheless, it was a probing amendment. I was interested in what the Minister had to say, and we can always return to the matter on Report if we are not happy. On that basis, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Ordered, That further consideration be now adjourned. —(David Evennett.)

Technical and Further Education Bill (Fifth sitting)

Robert Halfon Excerpts

Committee Debate: 5th sitting: House of Commons
Tuesday 29th November 2016 Public Bill Committees

[The Minister for Apprenticeships and Skills (Robert Halfon)]

I am grateful to the hon. Member for Blackpool South for tabling the amendment, and to him and the hon. Member for Luton North for what they have just said. I fully understand the concerns regarding the group of persons convened by the Institute for Apprenticeships and Technical Education to develop the standards, and I agree that the reforms to technical education should be informed by a balanced and diverse range of industry professionals. I also share the view that the institute should have a clear and transparent rationale for bringing together groups of persons to develop the standards.

I wish to comment on some of the issues raised by the hon. Member for Blackpool South. On apprentices and education, he will know that, as part of the reforms we have introduced, apprentices have not only to do the full-time, on-the-job training that is their apprenticeship, but to spend a significant amount of time at an educational institution, whether a private provider or an FE college. That offers them the education they need while they are earning.

Apprentices are able to give feedback to the employer and the provider. At the beginning of the apprenticeship, all parties have to sign a commitment setting out the roles and responsibilities, which include the giving and receiving of feedback. The apprentice is also able to give feedback during the review of the standard and assessment plans, and we can include that in terms of the guidance note from the Secretary of State.

[Gordon Marsden]

That is very encouraging. I know that that feedback process takes place; as I say, it has been welcomed by the various groups. I do not want to make things over-bureaucratic, but is there going to be a formal, or at least easily understandable, mechanism whereby apprentices can feed in—either as a group or as individuals?

[Gordon Marsden]

I am sorry, Ms Dorries. If the Minister is not in a position to say anything more on that today, I would welcome a note to the Committee at some point.

[Robert Halfon]

I will provide one, but I am always against very formulaic structures; things need to be flexible. The fact is that we give the opportunity for the apprentice to feed back at every step of the way, and the agreement has to be signed by the employer and the apprentice when the latter starts.

On the representation of small businesses, the hon. Gentleman will know that the trailblazer groups—there are roughly 10 employer organisations altogether—have to have a minimum of two businesses with fewer than 50 employers. We envisage that the employer panels will be the same. I am happy to reflect on that being included in the remit letter for the institute. We are also investing taxpayers’ money in huge incentives to encourage small businesses to hire apprentices and to encourage providers to take people on. We are doing everything possible to use taxpayer investment to ensure that small businesses hire apprentices and that providers do provide.

I would like as much as possible to be done by FE colleges, and I would be delighted if they took on more apprenticeship training. That is happening slowly, but I think they would be very willing. I have seen it happening in my own constituency of Harlow: whenever there is an issue to do with a company wanting an apprentice, Harlow College will be there, ready to advise the employer on what should be done and to offer training if it is required.

On the wider issue of the technical routes, I disagree with the hon. Gentleman. I shall set out the context of the problems we face. I have been quite open in admitting that we have a huge skills deficit in this country. The OECD said in 2012 that 20% of young people lacked basic skills. By 2020, the UK is set to be 28th out of 33 OECD countries for intermediate and technical skills. We are way behind.

The whole purpose of the reforms and the legislation—this is why Lord Sainsbury has supported them—is to ensure that we have state-of-the-art technical education for young people that transforms our skills deficit. People who do not want to do one of those 15 state-of-the-art routes, for technical and professional education, will have different options through other applied general qualifications and the academic route. The reforms focus on occupations that require the acquisition of a substantial body of technical knowledge and a set of practical skills that are valued by industry and that address employers’ needs and our huge skills deficit. I am glad that the hon. Member for Blackpool South quoted the Centre for Vocational Education Research, which my Whip guarantees is a blue-chip organisation.

[David Evennett]

The best!

[Robert Halfon]

Indeed. The centre says:

“We welcome the Report…led by Lord Sainsbury…the subsequent Post-16 Skills Plan”—

by the Government—

“and the measures contained in this Bill. The recommendations are consistent with our findings”.

It continues, and this is the whole point of the argument:

“Part of the problem is undoubtedly the confusing array of options, with uncertain pathways, that are on offer for young people after age 16. There must be a system that students, teachers, parents and employers…understand. Otherwise it is difficult for young people to be matched up with courses that are suitable for them and for employers to understand what qualifications actually mean.”

[Gordon Marsden]

I understand the Minister’s points, and I tried to make it clear that I am not asking for a huge response—we do not want to end up like the wax in a lava lamp, which starts off as a great base and goes up to the top before, after some time, becoming big again. I understand the need not to have duplication, but the AELP and others made a particular point about the service sector. Is the Minister not concerned that, if the Government are not careful, they will be, by excluding a large part of the service sector, in danger of sending out a binary message that certain sorts of occupations are valued and others are not?

[Robert Halfon]

No, because this is about technical and professional education. There are 15 routes, and people have many other ways of doing the vital training for the other areas that the hon. Gentleman mentions. People can do an individual apprenticeship, they can do part of the Government’s training scheme or they can do work experience. This is about addressing our skills deficit and, similar to what happens in other countries, ensuring that we have the technical education that our country needs.

On capacity, the institute will ensure that arrangements are in place for evaluating assessments. There are different options for employers and others to develop the standards. We will discuss the assessments later, but I will set out the current figures on apprenticeship assessment. On standards, some 61% of all apprentice starts have an end-point assessment organisation available to them, whether or not they are close to needing an end-point assessment. That figure rises to 94% for all apprentice starts, including those who are expected to reach the gateway—the end of their apprenticeship—within the next 12 months, where an organisation is close to being put on the register. We are considering a number of options and we will discuss them later, but the situation is not as bleak as has been said in respect of the assessment organisations and what is being planned and done.

The hon. Gentleman addressed the levy and the autumn statement, and I am pleased to say that we will still have £2.5 billion available for the levy, regardless of the announcements in the autumn statement. The Government are determined to create an apprenticeship nation, and by 2020 the spending will have doubled to £2.5 billion. We have discussed the providers, but I am happy to reflect on action that could be taken to ensure that SMEs are offering training that is relevant to their apprentices. I am pleased by the response from the providers so far.

The amendment raises other issues of concern. We need to learn from previous models, but there is a risk that requiring specific representation on the panels may not always be appropriate and may result in standards that do not have labour market currency. The purpose of the reform is quality, not quantity. If the panels try to do too much to please too many different groups, ultimately they might not support young people and adults in getting high-quality technical education to progress into skilled employment. The problem is that there is a proliferation of qualifications.

I agree that the groups should be as representative as possible, however. The Sainsbury report makes it clear that the institute will be best placed to ensure that the right people are brought together to develop the standards. Institute staff with expertise in specific occupational areas will know which employers and other stakeholders are suitable to develop standards that are representative of the occupations within the specific routes. The institute is independent. It should be for the institute to manage the composition of groups, and we should not constrain that process.

As for the approval of the groups that are not convened, it is for the groups to come together to put proposals to the institute. That has been the hallmark of the employer-led reforms, which, again, have been based on best practice in other countries. The groups should be flexible enough to reflect the requirements of specific occupations. In some occupations, such as blacksmithing, there are few large employers, while there may be other occupations in which there are no smaller employers or in which there is a bias towards a particular gender. On that point, I remind the Committee that 53% of apprentices are women, which shows that we are making significant progress, although of course we need to do a lot more to get women into STEM—science, technology, engineering and maths—and other key areas.

There are other ways in which views can be taken into account through the institute’s wider structure. Crucially, each route will have its own panel making decisions about the provision within that route. Standards will also be subject to peer review, the purpose of which is to ensure that the proposals meet wider needs. The institute’s board is open to applicants with a wide variety of interests. We hope to announce the composition of the board—genuinely—in the very near future. I firmly believe that once that announcement has been made, the hon. Member for Blackpool South will agree that there is important representation.

[Kelvin Hopkins]

Does the Minister agree that it is important to appoint the right person as chair of the board of the institute? We have had big, forceful characters in the field of public education, and sometimes they get it right and sometimes they get it wrong, but choosing the right person with the right skills and the right character to lead is crucial.

[Robert Halfon]

The hon. Gentleman is absolutely right. The board and the chairman are both incredibly important. The person has to have incredible knowledge of the field, as well as the charisma, connections and ability to drive the institute forward so that it can transform technical education in the way that we hope it will.

The Secretary of State will provide advice to the institute once a year on how it should carry out its functions, and the institute will have to have regard to that advice. As I have often mentioned, we will consult on the draft of the first guidance letter and provide advice on who the group of persons should be. We plan to encourage the institute to ensure that others with relevant knowledge and experience are included, as well as employers, professional bodies, sector experts, providers and assessment organisations—the more FE representation the better. The institute will need to explain in its annual report how it has taken that advice into account or, if it has not done so, explain why. I hope that that provides reassurance.

On amendment 13, the decisions to convene the panels will be driven by a robust evidence base. If the evidence shows that there is a need for a standard to be developed, the institute will be able to convene a group of persons if the trailblazer group has not already come forward. The need for the standard to be developed will be driven by the relevant occupational map. There will be an occupational map for each category of occupations or route. The maps will be underpinned by analysis of the labour market information and will illustrate how occupations are grouped together according to their shared requirements for skills and knowledge. The occupational maps will therefore provide the evidence base for all the provision within the route.

--- Later in debate ---

[Gordon Marsden]

Good.

[Robert Halfon]

Absolutely. They will be available on the institute’s website. The institute will publish information so that employers and others know what is required to gain approval to become a trailblazer group. Amendment 13 is therefore unnecessary, because the need for a standard in the absence of a trailblazer group should be the only trigger for the institute to convene a panel. Where the institute convenes a group to develop a standard, its approval of that group is implicit.

In light of that information, I hope that hon. Members agree with this approach. Designing the system around clearly identifiable occupations, and bringing together employers and others to identify the skills, knowledge and behaviours needed for those occupations, will ensure the new system genuinely meets the needs of employers and technical education. I hope the hon. Member will feel reassured enough to withdraw the amendment.

[Gordon Marsden]

I am very grateful to the Minister for going into detail and for the thoughtful and measured way in which he responded on the three amendments. It is a very techie but extraordinarily important area to get right. The intervention by my hon. Friend the Member for Luton North about the chair was particularly apt in that respect, and I am glad the Minister recognises those points.

I am interested to hear the Minister say that £2.5 billion will still be made available for England. Presumably, that means there will be less available for Scotland, Wales and Northern Ireland. If I am wrong on that matter, I ask him please to come back to me. It was quite clear in the autumn statement that the figure was £2.8 billion, so I just assumed that it would go down to £2.3 billion. If the Minister assures me that it is £2.5 billion, that is obviously good news for England.

We share a view on the direction of travel with the routes, but I am not as sanguine about what the Minister said about the technical side. We will reflect on that. I am pleased that he has given more detail on the occupational standards and that he has addressed the SME and gender issues. Again, we may have a further discussion at some point about the mechanisms in that respect. On the whole, he has given a positive and reasonable response. We can always come back to these issues on Report, if necessary. On that basis, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Gordon Marsden]

I beg to move amendment 14, in schedule 1, page 24, line 6, leave out “as it considers appropriate”.

This amendment would require the Institute to publish apprenticeship assessment plans for all standards.

The Minister may want to say the same sorts of things on amendment 14 as he touched on under amendment 13. Nevertheless, I rise to move the amendment because it would require the institute to publish apprenticeship assessment plans for all standards. I hear what the Minister says about numbers and everything else. I shall reflect on that and drill down into the detail. However, recent analysis shows—this, of course, is real-time experience—that there are no approved awarding organisations for over 40% of learner starts on the new apprentice standards. Number crunching on the Government data that were published in October suggests that that applied to 1,790 or 42% of the total number of starts so far on the employer-developed programmes.

I accept, as I am sure will the Minister—it must make him tear his hair out at times—that because moving from frameworks to standards is an iterative process, there will be complications. There will be stats that do not appear to fit, and all the rest of it. I am not criticising the fact that there will be an element of confusion. However, those apprentices on the standards will have to pass end-point assessments for the first time, so those assessments have to be carried out by organisations that have been cleared for the task by Government or the Skills Funding Agency-registered apprentice assessment organisations.

I come back to my opening remarks on the previous group of amendments about the degree of uncertainty that still exists about how this will settle down in terms of what the institute does as opposed to other well established bodies such as Ofqual. Because of that, it is important that we have transparency on who is being cleared and who is doing the clearing.

The Minister may be familiar with the observations of Dr Susan Pember, who stood down as the civil service head of further education and skills investment in February 2013. I am very familiar with Dr Pember. On one famous occasion, when we had challenged the Government on various things, she said that we had been challenging them too much. The Minster’s predecessor, the right hon. Member for South Holland and The Deepings (Mr Hayes), said that we were absolutely right and that that was the role of the Opposition. Dr Pember has said:

“It is diabolical to let an apprentice start a programme without explaining not only what the end test will contain, but where it will be, what shape it will take and who will be the organisation—

that is the key point—

“to oversee and manage the process.”

We are told that the Department for Education—the Minister can contradict this if he wishes and it would be very pleasant were he able to do so accurately—is still struggling to recruit enough of those assessment organisations. Indeed, one of its spokespersons said:

“We know there is more work to be done to ensure we have the range and breadth of high quality assessment organisations we need.”

We are also concerned that the slowness with which this process has been taken forward has meant that students have not started on some apprenticeship standards for two years after they were launched. I appreciate that this refers to matters that took place not on the Minister’s watch, but it will colour and inform what people think about what the new institute does and what guidance the new institute is given in this respect by Ministers. The backstory, as it were, is an important one.

FE Week has looked at the latest Skills Funding Agency data, specifically the first standards that were given Government sign-off in 2014. It found that there were no starts at all in that academic year, or in 2015, while low numbers of students were recorded in several others. There may be an element here of what I described in a previous sitting as the very slow process of taking these trailblazers though. On that occasion, I alluded to the issues raised by the Transport Committee about the time it had taken to passport various standards that were developed in the maritime sector into the required frameworks for the SFA.

The National Skills Academy for Food & Drink took a lead role in developing one of the apprenticeships that ended up having no learners for food and drink maintenance engineers. Its chief executive frankly blamed the Government. She said that employers involved with the trailblazer group led by the NSAFD, which developed the standard, had been

“frustrated by the evolutionary nature of the government’s decision making process for approval. We were advised at the start that this new and innovative approach was called ‘open policy-making’… Unfortunately policy implementation does not lend itself well to this approach and valuable employer time and effort has been spent unpicking decisions made as policy decisions have firmed up. This has led to redrafting, reworking and lost time, such that the industry has written to the new skills minister, requesting that the Department for Education implements a far more structured and clear process for the future.”

That refers to things that have happened historically in the last couple of years, but the Minister will understand why, on the basis of that, we are keen to make sure that the institute publishes all of its apprenticeship assessment plans for such standards in a timely fashion. Will the Minister, if he is able to, tell us what is the status of his response to the NSAFD on that issue? Its chief executive, Justine Fosh, said that the standard had not been ready for apprenticeship starts until the beginning of this academic year, but that

“at least 60 students I know of”

have started since September.

That is only one example, but as this process strengthens and multiplies, as it needs to do to meet all the Government targets, the Government will have to pay close attention to this issue of capacity and this iterative process, otherwise they will find themselves in a logjam of standards approvals as early as the middle of next year. That is the point at which any Government of any political persuasion, when they have the Opposition or other stakeholders bearing down on them, might be tempted to cut corners. We do not want to see corners cut, but we, like the stakeholders, want to see what progress is taking place in real time. That is why we have put amendment 14 before the Committee today.

[Robert Halfon]

The hon. Gentleman said that there was a slow process in taking the trailblazers through. We have committed to carrying out all Government checks and approval processes within six weeks. The average development time is one year. The policy has changed over time and the employer groups have had to make amendments at times.

Under previous amendments, I set out the position on the 61% of all apprentice starting standards. That rises to 94% of apprentice starts, including those that are expected to reach their gateway. We have had some difficulties relating to low volume apprenticeship standards and we are considering recommending a targeted procurement organisation for a bundle of these standards. We are doing everything possible to make sure that the proper assessment organisation is in place.

The amendment recommends that all published standards must be accompanied by an assessment plan. The legislation already allows for the institute to publish assessment plans for standards as it considers appropriate. The flexibility on this is intentional. Our objective is that the Institute for Apprenticeships will assume responsibility for college-based technical education. At that point, standards will apply to both apprenticeships and the college-based routes, but assessment plans will still only apply to apprenticeships. College-based technical education will be tested in a different way because it is taught in a different way, even though it may be testing similar outcomes. It will be up to the panels to decide how each college-based course should be tested, but the proposals have to be scrutinised and approved by the institute. There will be some standards that are not appropriate for apprenticeships and that will be used only for the college-based routes; it is therefore unnecessary to develop and publish a plan for those standards. I hope the hon. Gentleman is reassured enough to withdraw the amendment.

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[Kelvin Hopkins]

I will speak briefly in support of my hon. Friend. The reality is that those who have become chief executives and chairs of organisations—those with leading roles—are frequently strong characters who want their own way. Some will not want to include in their organisations and structures people who are likely to challenge them. I have seen at least one notorious leader—he has now left, I am pleased to say—who wanted his own way. He would have liked acquiescent, docile and amenable people in his organisation, not people who put alternative points of view, which is actually often a healthy thing. In this place, we want people to put forward alternative points of view and have a range of opinions, even within parties, so that we get things right. We can make mistakes if we allow a wilful leader to have their own way without ever being questioned, let alone challenged.

My hon. Friend is right. We do not want to cause problems within these bodies, but it is important that a range of insights into what is being done is represented within them. I have concerns about giving too much power and freedom to wilful individuals who may not wish to be constrained by having, for example, a trade unionist on the board. Indeed, there are those who will not want a trade unionist on a body, whether that body is a board or a committee deciding on apprenticeships. I strongly support my hon. Friend and hope that the Minister can be persuaded.

[Robert Halfon]

This discussion is incredibly important. I understand that the hon. Members for Blackpool South and for Wythenshawe and Sale East who tabled the amendments want a quality, fair, open and genuinely representative institute at all levels. For me, this is not an argument about quotas. There are three issues: that the institute gives us high-quality technical education that meets our skills deficit; that the institute is independent, but employer-led because, as the Sainsbury report argued, that is how we will achieve that goal; and the question of the best way to achieve representation.

I welcome the intention behind amendment 15, which is to ensure that the groups who develop assessment plans are representative of the sector and others with an interest in ensuring high-quality assessment that really tests the achievement of the standard. That is what we want to do. The experience of the past few years from running our own trailblazer process is that the vast majority of groups that have come together to develop the standards and plans have been representative of the sector. Like the hon. Member for Luton North, I am not opposed to trade unions. I am a union member and very strongly support Unionlearn, which the hon. Member for Blackpool South mentioned. I hope very much that the trade unions will be involved in some way or another.

[Kelvin Hopkins]

I know very well the Minister’s record and admire the fact that he is a trade unionist, but not all politicians in this place are quite so at ease with trade unionism. Indeed, in the world outside not all are as admirable as the Minister in his support of trade unions.

[Robert Halfon]

I thank the hon. Gentleman for his comment but I think the issue is about how to create that representation. That will be the point of discussion between us.

In the institute, we have designed an organisation that will be able to carry out apprenticeship functions independent of Government, so that the decisions have credibility with employers. The Enterprise Act 2016 gave it autonomy in determining who should be approved to develop each standard and related assessment plan. The idea was to ensure that it had the flexibility to respond differently to different sectors and ensure that the groups are representative. Although it is right that the institute is independent and can make its own choices about how it operates, it is incredibly important that the Secretary of State is still able to give it guidance through a written statutory notice. The institute must have regard to the statutory notice and must justify its actions if it chooses to disregard the advice.

We will shortly consult on the draft of that guidance and that will provide advice on who the group of persons should be. I very much want to encourage the institute to ensure that others, beyond employers, with relevant knowledge and experience are included. As I said in the previous debate, that would be professional bodies, other sector experts, FE providers, other providers and assessment organisations. I strongly encourage hon. Members of all parties to engage in the consultation and give their views.

On amendment 16, I appreciate the interest in ensuring that the institute must be transparent in why it convenes groups and develops an assessment plan. It is essential that we avoid the proliferation of new standards and assessment plans, learning from the experience of previous apprenticeship frameworks. The whole purpose of the reforms is to ensure quality over quantity.

I am sure that hon. Members are aware that in formal technical education, standards form the basis of both apprenticeships and college-based technical education courses. With reference to the previous debate, the quality will the same whether it is the assessment of an apprenticeship or classroom-based education. It just reflects the nature of the different delivery between apprenticeships and college-based courses. Quality is everything; it is the whole purpose of the reforms.

In addition to employer demand, the need for the standard will be informed by the occupational maps. There will be an occupational map for each category, and the maps will be underpinned by labour market information. That is the best way to provide an evidence-based road map for all the provision within each route. The institute must ensure that standards exist for all skilled occupations that need them. Where an approved group of employers and other persons is not available, the institute will be able to convene a group to develop a standard and an assessment plan where necessary, but the occupational map must be the primary factor for determining whether a group of employers is convened. The occupational maps, as well as the approved standards, will be available on the website. The institute can convene a group to develop a standard only if one has not come forward organically, motivated by employer demand. The only other criterion that the institute will use to convene a panel itself is the occupational map, which is publicly available. Therefore, the information that the amendment requests is unnecessary.

The amendment could also have the effect of requiring the institute to publish its set of criteria for who should form the group of persons who will develop the assessment plan. As I said response to amendment 15, it is up to the institute as an independent organisation to decide the detail of how it carries out its functions, but I will reflect seriously on what has been said. I believe in strong representation in all parts of the institute, and we can suggest that it be part of the Secretary of State’s guidance to the institute. For that reason, I hope that hon. Members will feel reassured enough to withdraw the amendment.

[Gordon Marsden]

The Minister, with thoughtfulness and detail, has taken much the same view on amendment 16 as he took on amendment 15, and I will do the same. I heard what he had to say. It is one of those issues on which we agree to disagree, but as he said, we will have the opportunity to pursue it when the guidance is issued. On that basis, I am content to withdraw amendment 16.

On amendment 15, I have listened carefully to the Minister’s measured and thoughtful response. We are not disputing that the process must be employer-led. That is why we particularly say in the amendment

“a number of employers which, taken together, comprise a broad range of employer within the given occupation”.

That is the issue: there must be somebody in that group who knows their stuff.

This might be a fundamental philosophical difference between us. I find it odd that the Government should so set their face against putting in the Bill the principle that there should be a trade union representative, or indeed someone who could represent the interests of students or apprentices. I was tempted on that basis to press the amendment to a vote, but I will not. I have heard what the Minister said. We will wait to see the guidance, and we will want to contribute to it. As I said, we can always return to the matter on Report. With some reluctance, but recognising his bona fides in the matter, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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For all those reasons, through amendments 29, 31 and 33 we are arguing strongly that regulations should be subject to the affirmative procedure, rather than the negative procedure listed in the policy document.

[Robert Halfon]

I thank the hon. Gentleman for his scrutiny. I need to explain the context of why we have chosen to go down this route. We have had a lot of discussion about the quality and evaluation of apprenticeship assessments. Ensuring consistency between assessments will mean that an apprentice can be sure that, wherever they obtain their apprenticeship, they are being judged on a fair and equal basis.

Our aim is that the institute should work to ensure that an apprentice in Hull and an engineering apprentice in Blackpool both have consistent and high-quality assessment. The power that allows the institute to charge for its role in reviewing assessments is critical to enabling it to discharge its function of evaluating assessments effectively.

Other organisations approved by the institute to carry out a quality assurance role in relation to apprenticeship assessments, such as professional bodies, are likely to charge. If the institute were unable to charge, there would be an increased incentive for employers to use the institute instead of the other options, and the extra running costs would ultimately fall on the taxpayer. It follows that, like other organisations, the institute should be able to charge for its work and to recover all its costs.

Importantly, the specific fee is likely to be adjusted over time for a range of reasons, such as to reflect any changes in the institute’s approach to carrying out evaluations and as assessments are updated and altered. Additionally, as the Committee will appreciate, the institute is still finalising the operational detail on how it will carry out some of its functions, including the evaluation of assessments, which we have just debated.

The actual amount that the institute will need to charge is not known. It is conceivable, although it has not been decided, that there could be different fees in different cases to take into account the cost of evaluation in different sectors. I reassure the Committee that the policy is that organisations should be able to charge only to cover their costs. We will make that clear to the institute in the guidance letter. Of course, the institute will be able to charge only if authorised to do so, and subject to the restrictions set out in the regulations.

It is likely that the fees would need to be reviewed quite frequently to ensure that they were appropriate, which is why hon. Members will welcome the provision to allow for the introduction of a statutory instrument without requiring Parliament to debate the matter each time a fee changes. The negative procedure ensures that the fee levels can be updated relatively quickly, if necessary, thus protecting the taxpayer from unwanted financial risk. The procedure is consistent with the Secretary of State’s approach to charging fees for certificating framework-based apprenticeships and, more recently, for English apprenticeship certificates—we are doing that in parallel. Even so, as the hon. Member for Blackpool South pointed out, regulations tabled under the negative procedure can still be debated in Parliament. If there were real demand, scrutiny could still be achieved.

Amendment 31 raises the same issue. I agree that any matter left to secondary legislation requires scrutiny, but the negative procedure provides for sufficient parliamentary scrutiny and would enable debate if the secondary legislation was prayed against. In the event that the institute wishes to introduce an application or process, or to update the fee levels, the negative procedure allows for that to be done as quickly as possible, which is consistent with the Secretary of State’s approach to apprenticeships.

As the institute is not yet established, flexibility is needed to prescribe the most appropriate method. We may also wish to seek advice from the institute and others on what those measures should be. I confirm that, at most, the fees should cover all the costs connected with carrying out the function.

I turn to amendment 33. The Secretary of State has powers to make arrangements to develop new technical education provision. The Bill would allow the Secretary of State to transfer those powers to the institute to ensure continuity. I hope it will reassure the hon. Member for Blackpool South and his colleagues if I give a broad overview. We are progressing the arrangements that we are putting in place before the institute takes on its wider responsibility.

The hon. Gentleman will know that creating this new technical education provision is a complex process. Although we are committed to taking through the reforms quickly, and particularly to establishing all 15 technical education routes as soon as possible, we recognise that certain lead-in times are required for reform. The Government plan to phase the reforms in progressively; development will commence before the institute remit is expanded in April 2018.

We have already talked about the occupational maps and the routes to identify occupations. We know that employers will play an especially important role in assessing the standards, including articulating the knowledge, skills and behaviours needed. I assure hon. Members that the negative procedure provides sufficient parliamentary scrutiny. We have thought carefully about the right balance of primary and secondary legislation and about which procedure to use for secondary legislation. We have set out the rationale in the delegated powers memo for the Delegated Powers and Regulatory Reform Committee in the other place and I look forward to reflecting on that Committee’s response. I hope that the hon. Member for Blackpool South will feel reassured enough to withdraw the amendment.

[Gordon Marsden]

Again, I am grateful to the Minister for the thoughtful and measured way in which he has put his point of view. I entirely accept everything he has said about the need to move carefully and about the fact that there may be variations in charges and that we may have to return to them frequently.

However, none of that undermines the essential argument that this is a new Bill that is taking on new stuff. We believe—I am afraid that history teaches us lessons in this respect—that it is far safer for the Bill to specify the affirmative procedure than the negative procedure. Although I appreciate the Minister’s remarks, I regret to say that we wish to press the amendment to a vote.

Question put, That the amendment be made.

Technical and Further Education Bill (Sixth sitting)

Robert Halfon Excerpts

Committee Debate: 6th sitting: House of Commons
Tuesday 29th November 2016 Public Bill Committees

[The Chair]

I remind the Committee that with this we are discussing the following:

Amendment 31, in schedule 1, page 28, line 32, at end insert—

“(3) Regulations under this section shall be laid before Parliament and shall be subject to the affirmative resolution procedure.”.

Amendment 33, in schedule 1, page 30, line 17, leave out “negative” and insert “affirmative”.

[The Minister for Apprenticeships and Skills (Robert Halfon)]

I will pick up on a number of points that have been raised before talking about the main substance of the amendment. A key recommendation of the Sainsbury report, No. 8, stated:

“While it is right for the Institute for Apprenticeships to be delegated wide-ranging autonomy across its operational brief, responsibility for key strategic decisions must be reserved for the Secretary of State. Crucially these decisions include those relating to the shape of the overall national system of technical education”.

The Secretary of State will obviously consult when making her decision, and she needs to ensure that any directions are reasonable and include all relevant factors, which means that the Government consult and listen where appropriate. Under public law duties, a Secretary of State has to act reasonably and fairly.

The hon. Member for Blackpool South mentioned City & Guilds, which stated:

“The City & Guilds Group fully supports the Government’s policy drive to improve the skills of the UK workforce and improve the transition for those entering employment from education and training. We see much merit in the Post-16 Skills Plan, and look forward to continuing to work with the Government and the new IATE to improve the quality and esteem of vocational and technical education in the UK.”

The hon. Gentleman also talked about the timescales. We will publish an implementation plan in due course—a real “due course”—which will set out the timeline for delivering the technical education reform set out in Lord Sainsbury’s independent plan and the Government’s post-16 plan. It will demonstrate firmly how we are to ensure that the institute will be able to deliver its functions according to the plan’s timescales.

As I said all the way through this morning’s sitting, the whole purpose of establishing the Institute for Apprenticeships—now to be the Institute for Apprenticeships and Technical Education—is to give employers a clear and independent voice. I understand that it must be strange at first sight that the Bill gives the Secretary of State powers to issue directions to the institute in respect of its responsibilities for technical education qualifications and the steps towards occupational competence, but the limitation in the amendment is neither necessary nor desirable, and I want to set out why.

I have mentioned Lord Sainsbury, who touched on this again in oral evidence to the Committee. We are including the direction provision in the Bill because it ensures that although the institute has real responsibility for developing and operating the technical education system flexibly, that will be in an overall strategic context guided by the Secretary of State. The Committee might be concerned that we did not include a similar power in respect of apprenticeships and the institute, but the two cases differ substantially. There is a stronger relationship between technical education and the education system as a whole—apprenticeships form part of that—particularly as it relates to young people, than is the case with apprenticeships individually.

To make it clearer, let me describe the circumstances in which we envisage that the direction power may be used. They could include a national requirement for all qualifications taken by 16 to 18-year-old students to include a specific core skill or knowledge. Or they could reflect reforms to other parts of the system, such as a change in the structure of A-levels or in the length of the academic year, which might have a strong impact on the shape of technical education provision. Many issues covered by the directions are likely already to be subject to specific consultation before they are put in place, such as the consultations that take place on A-level subject content. The direction power simply enables the Secretary of State to ensure that her wider policy responsibilities are given effect throughout the system.

[Gordon Marsden (Blackpool South) (Lab)]

I intervene on the Minister at this point to clarify that the point of the amendment, and the argument I made, was not to question in any way the ability, legality or desirability of the Secretary of State having an ongoing, one-to-one relationship with the institute. The point was that the aggregate of those instructions, if they are not tempered—that is the way I want to look at it—by a periodic review or consultation with the sorts of organisations that we have talked about, could cause not a chasm but a gap between what one set of people know and what another set know. I entirely understand the Minister’s point about making these decisions based on technical things, but that is the purpose of the amendment. The purpose was not to question in any way the desirability of the Secretary of State having that one-to-one relationship.

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[Robert Halfon]

As I mentioned previously, it is highly likely that the Secretary of State, when issuing a strategic direction, will have a full and thorough consultation. We want to make sure that the Government are able to exercise overall strategic control where necessary and without delay.

The amendment relates to additional consultation on, and review of, directions issued to the institute, rather than the principle of the direction-making power itself. We have just agreed that those directions are likely to deal with changes to the education system as a whole, for which consistency of implementation is of primary importance. Consultation and review relating to only part of the system—the institute’s responsibilities for technical education—seems to have little practical value and, we think, might cause considerable delay, which could put coherent and consistent implementation of strategic measures in peril.

There might be other cases in which the Secretary of State would need to intervene quickly, for example before arrangements for particular qualifications are finalised. We therefore believe that the Secretary of State should be able to exercise a direction power of the kind the Sainsbury panel had in mind, without a specific requirement for additional consultation and review, even though it is unlikely that there would be no consultation when that directional power was given. I therefore hope that the hon. Gentleman will agree to withdraw the amendment.

[Gordon Marsden]

I have heard what the Minister has to say on this matter. Again, I make the point that we are concerned about the aggregate process, and it is that process that prompted this probing amendment. The Minister mentioned the implementation plan, which raises another issue that was brought to us by a number of different people. The Minister and I swapped quotes from City & Guilds, but the original comment I made was what City & Guilds said about the timetable. The implementation plan, which he says will give the timeline in due course, is welcome, and may well allay some of the concerns that others have had and which we have tried to reflect in the amendment. If that is the case—in due course—we will be satisfied. I therefore beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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[Kelvin Hopkins (Luton North) (Lab)]

I support what my hon. Friend says about amendment 17. It is very important to have representation by an apprentice or someone who has recently been an apprentice, so the board gets feedback from someone who has been on the receiving end of the experience, rather than just from people who think they know about it, but may not know it all. An apprentice who has spent considerable time going through the system will have a lot to offer to the board, so that is very important.

It is important to have members of the board who are different from the rest of the board. In the past, having one woman on a board—nowadays, we have many more than that, I am glad to say—made a difference to the nature of the discussions. Having representatives from minority communities on boards makes a difference by broadening the discussions and making them better. Assumptions that might have been made if the board were made up of small “c” conservatives and middle-aged white men in suits—I am one of them—can be challenged. We see too many people like me, and not enough of other people—[Interruption.] I said people like me, not necessarily me personally. It is important to recognise that there are other voices and other views, and the way to get those views represented is to have such people on the boards. Having at least one apprentice on a board is a good idea, although it should be someone who is experienced—someone who is coming to the end of their course or has just completed it, not someone who is at the beginning of their course. I strongly support what my hon. Friend said, and I hope the Government take cognisance of his views.

Turning to amendment 32, I have chaired two confirmation hearings and I sat on a committee interviewing an appointee before they went for their confirmation hearing. I think it is an extremely good exercise that has improved the quality of the appointments in recent years, so I very much welcome it. Occasionally, the people have not been ideal for the job and have chosen to stand down before going right through the process; I think that shows wisdom. Sometimes the Government and Ministers have been reluctant to let go of appointments, but they have now done so, and I think they are pleased with the job that Select Committees have done on confirmation hearings. I really do think that this would be a very good idea.

It is particularly important to have confirmation hearings for the chair, although perhaps the chair should deal with the chief executive. The confirmation hearings I chaired were to do with that role. It might not have been a chair—it might have been a director or something—but we were essentially interviewing for the chair role. It was extremely interesting and very useful, and I think that in each of those hearings we got the right result. I support amendment 32 in principle, even if my hon. Friend does not press it to a vote.

[Robert Halfon]

Let me begin by saying that if there were more people like the hon. Member for Luton North in education and skills, we would be in a very good place indeed—whatever their age may be.

[Kelvin Hopkins]

I should correct myself. I said “middle aged”; I think that is rather beyond me. [Laughter.]

[Robert Halfon]

I thank the hon. Member for Blackpool South for tabling these amendments, particularly amendment 17, which is a very thoughtful amendment. He may be interested to know that even before they were tabled, when we were discussing these matters, I made some of the points that he just made.

Regarding advertising and interviewing for the board members, we have had 281 applications to the board, representing a wide spectrum of apprenticeship experience. I believe that once the board is finalised the hon. Gentleman will be happy with the membership—we have a few rubber stamps to go yet, but I think he will be happy. He will know that the board is responsible for ensuring that the interests of apprentices and students of technical education are well represented.

I have thought about this issue very seriously—long before we discussed it in Committee—but I cannot go so far as to say there should definitely be apprentices on the board. In part that is because board members need to have experience and they carry a great deal of governance responsibility; they also come under press scrutiny, which is not easy. In addition, the board needs to represent the interests of all apprentices of varying levels, ages and sectors, so a single recent apprentice would be unlikely to speak for all apprentices. We do not think that the amendment offers the best way to represent the interests of apprentices and those in technical education.

I think we can square the circle by agreeing that the institute should draw on the experiences of apprentices, so I am pleased to announce that we expect the institute to invite apprentices to establish an apprentice panel, which would report directly to the board. The panel would be made up of apprentices from different occupations and experiences. The panel would decide for itself which issues to focus on, and it will challenge and make recommendations to the board. That squares the difficult circle of wanting experience but also having the vital input from apprentices up and down the country. The Institute for Apprenticeships and Technical Education will ensure that the first panel is in place before the institute goes live in April 2017. The institute will consider how best to engage with apprentices on an ongoing basis and how best to represent technical education students ahead of it taking on that responsibility in April 2018.

I am also pleased to report that there are plans to recruit three apprentices to work at the institute, which will review that number periodically. While I am in this post, I will certainly look at this issue with an eye to expanding the number of apprentices who work for the new institute.

Regarding amendment 32, I understand that it is looking for scrutiny of these crucial appointments—the hon. Member for Luton North spoke about how important these appointments are. However, given the size and scope of the institute, and even after the addition of the new functions in the Bill, I do not agree that the amendment is necessary. Generally, appointments that are subject to confirmation hearings by Select Committees are to much larger organisations. Furthermore, the appointment of the chair is subject to a code of practice set out by the Office of the Commissioner for Public Appointments, as the hon. Gentleman no doubt knows, and is already subject to a high degree of scrutiny.

In line with requirements, the Secretary of State has approved the launch of a recruitment campaign for the chair and the public appointment selection panel. The panel is chaired by a public appointments assessor, and as the appointing Minister I am kept informed every step of the way. A shadow chief executive is in post; the recruitment of the permanent chief executive will follow established civil service rules, with fair and open competition. Also, the Enterprise Act 2016 is clear that the chief executive will first be appointed by the Secretary of State in consultation with the chair and thereafter by the institute itself. The chair and chief executive can of course be called on by the relevant Select Committees to give evidence to Parliament and account for their actions

I do not think the amendment is necessary as I believe that the appointments will be subject to appropriate scrutiny, consistent with established public appointment rules. I hope that the Committee agrees on the need for the institute’s leadership to be established without delay, especially given questions posed by the hon. Member for Blackpool South about the institute’s capacity, whether it will be set up in time, and so on. I hope that the Opposition are sufficiently reassured by that information to withdraw the amendment.

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[The Chair]

Before I call the Minister to respond, I remind Committee members that any decisions on new clauses are taken at the end of the Bill.

[Robert Halfon]

I will start with new clause 4 and then go on to the other provisions before answering the general queries of the hon. Member for Blackpool South.

I congratulate the hon. Member for Batley and Spen on a really important contribution to the debate; I mean that genuinely. She knows from the brief conversation we had that I completely agree with much of what she says. I agree that we have a problem with careers in our country. I agree that for so long, careers guidance has pushed people towards universities. Having said that, I can imagine a lot of things, but I could never imagine the hon. Member for Luton North as a banker—I have a broad mind, but it is not that broad.

One reason why we have those problems is that wherever I go around the country, whatever institutes I visit and whatever kids I speak to, it is exactly the same: the chances are, they will not have been given advice on apprenticeships or technical education. It is university, university, university. We need to change that. I would be pleased to have the hon. Lady’s input. Careers guidance used to be fragmented and covered by two Departments, but we have moved it wholly to the Department for Education.

When I was appointed Minister for Apprenticeships and Skills, I realised that the title should have been Minister for apprenticeships, skills and careers guidance because careers guidance is perhaps the most important part of everything we are trying to achieve in the Bill. It is the first rung on the ladder of opportunity because without the right careers guidance we will not succeed in what we want to do. That goes back to the arguments of the hon. Member for Luton North on prestige and other things.

The hon. Lady said—this is important—that we need more than just warm words. I accept that and I am looking at the whole issue from the beginning: what we can do in careers guidance, whether it is possible to gear it much more towards skills and starting not in secondary school, but primary school and going all the way through. To be fair, the Government have done substantive work. First, it is now a legislative requirement that schools must give careers advice on apprenticeships. With reference to what the hon. Member for Luton North said, we have also tightened up in legislation the definition of “apprenticeship”.

When I spoke at an hotel recently, I asked someone whether they realised they would be paying the levy and whether they were going to have apprentices. The reply was, “We’ve already got some in the kitchen.” When I said, “You already have apprentices?” they replied, “No, they are interns, or whatever.” We have changed the definition to make sure that an apprenticeship is what it says on the tin.

We have also created the Careers & Enterprise Company, to which the hon. Member for Luton North kindly referred, and again I have been around the country to see it working in practice. I have been to east London and the north-east. Of course there is much more to do. Some £90 million, which is a serious amount of money and not just warm words, is being invested over the Parliament not just in the Careers & Enterprise Company, but in careers generally: 1,190 enterprise advisers and 78 enterprise co-ordinators. They have connected 900 schools in about 37 of the 38 local enterprise partnerships, the whole purpose being to build careers links with students and to get them to do work experience.

There is a £5 million careers and enterprise fund to boost provision for nearly 250,000 young people across England in 75% of the areas the Careers & Enterprise Company identified as cold spots. There is a £12 million mentoring fund, because mentoring is incredibly important. This year, £75 million is being spent on the National Careers Service to help its work and £24 million on web kits to support more than 650 people with face-to-face advice. We have started the work.

[David Rutley (Macclesfield) (Con)]

My hon. Friend is setting out some important things the Government are doing and no doubt he will explain what more is to be done. Does he agree with Lord Heseltine who said recently in a Select Committee that industrial policy for the benefit of the country starts in primary school classes if we are to achieve the productivity gains we want?

[Robert Halfon]

My hon. Friend is exactly right. I was in a primary school—it might have been in the constituency of the hon. Member for Blackpool South—where the kids had to guess the career of the individuals there. They included a fire officer, a business person and a pilot, who then went out and returned with their uniforms on. Careers guidance must start in school. We will not achieve what we want unless it starts in primary schools.

I am looking at the matter and there are substantive funds, but we must change the whole argument and gear careers advice towards skills and apprenticeships, although we have no problem with people going to university. I have held roundtables, not just with the great and the good, but with people from up and down the country, to get ideas for how to form our careers strategy. The hon. Member for Batley and Spen is very welcome to take part in them when they carry on next year.

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[Gordon Marsden]

I understand the Minister’s point, and I, likewise, would not want to lumber the institute with the responsibility for all those things. Will he give us an assurance, because he said these things occur from time to time, that there will be, at some point during an annual cycle, what I can only describe as a “state of the nation” report? That report could actually bring these various things—not necessarily all of them—together, so that not only stakeholders but Parliament will have a clear picture of what has happened over the past year.

[Robert Halfon]

I will reflect on what the hon. Gentleman has said. I reiterate the point that a lot of that is done already. We have monthly and annual announcements of all kinds of data to do with apprenticeships and skills. I always ask about destinations because I think they are incredibly important. I am glad that surveys show, for example, that more than 90% of apprentices get into work afterwards, either by staying in place or entering other employment. That is an incredibly important destination statistic.

On new clause 5, the principle of consultation, which we have mentioned quite a lot today, is already a key feature of the current Institute for Apprenticeships. The institute has a statutory duty under the Enterprise Act 2016 to undertake its functions with regard to industry, commerce, finance, the professions and other employers regarding education and training within the institute’s remit. Even more importantly, the institute must also undertake its functions with regard to those who may wish to undertake education and training that is within the institute’s remit—the apprentices themselves.

More specifically, the institute also already has a statutory responsibility to ensure that all draft standards and assessment plans are subject to third-party scrutiny before they can be considered for approval, and it must take account of the findings and conclusions of those carrying out that independent review. The bodies and organisations listed in the new clause are already covered by that existing legislation, and the institute must have regard to them in all functions, not only the specific function set out in the new clause. That approach will also apply to the functions that the Bill plans to give to the expanded IFATE.

The consultative principles that will underpin the institute have already been evidenced. Antony Jenkins, the shadow chair, has held a series of roundtables with a wide range of external organisations to hear how they think the institute should operate. Later this year the shadow institute will publish a full consultation on the operational plan for the institute, setting out its core functions and proposals for how it will deliver them.

The Department also plans to publish a draft for the consultation of a statutory strategic guidance document, which it will issue to the institute next year. That will include the steers that the Government expect the institute to have regard to. It will ensure that the institute consults all those with an interest when carrying out its functions. I therefore hope that the hon. Members will be reassured and will not press the new clauses.

I will come to an overview of schedule 1 but will begin by answering some of the key questions the hon. Member for Blackpool South asked. Although the 19 to 24-year-old NEET figure increased by 0.8% in July to September, he will know that the overall trend has been down over the years. The figure for 16 to 18-year-olds fell by 1.5% compared with the same quarter in 2015.

The hon. Gentleman also asked about the clarity of a single awarding body—the Wolf report body. Of course, we looked at that but the Wolf report, as the hon. Gentleman will know, identified that a large proportion of vocational qualifications offered very little value to employers, young people and adult learners. The whole purpose is to remove thousands of poor-quality qualifications that were not valued by employers.

The proliferation of qualifications was partly down to the awarding organisations’ competition for market share within the existing system. Following Lord Sainsbury’s recommendations, we are bringing the system into line with the best in the world to ensure excellence in technical education provision and having a single awarding body per qualification model. It is strange that the hon. Gentleman should argue for competition while I am doing the opposite but we live in a topsy-turvy world. We are not being driven by competition in the market, with the adverse effects that that brought. Innovation will be driven by the awarding body competition for the market through winning exclusive licences.

[Gordon Marsden]

We may live in a topsy-turvy world but, on balance, we are a little less gung-ho about competition than the Minister’s colleague, the Minister for Universities, Science, Research and Innovation, was on the Higher Education and Research Bill Committee. However, that was not the point I was going to make.

The point I want to make is that there is a distinction. I made it clear that I was putting forward the concerns of a number of the awarding organisations that they put to us in evidence. There is a clear difference between letting 1,000 flowers wither because they are of poor quality, and coming down to a single qualification point. I made the observation in one of the papers that the suggestion had been made that there might be two or three. There was no suggestion that there should be no dilution; simply that a monopoly position was possibly unwise, not least because one of the awarding companies might one day go bust.

[Robert Halfon]

I will reflect on that but the whole purpose is to ensure quality and simplification. Once it is agreed to have another one, then there is another and another and so on. I think we are right to follow the recommendations of Lord Sainsbury and Baroness Wolf.

[Tracy Brabin]

I appreciate the amount of money given to careers advice; it sounds substantial. I have just googled the Careers & Enterprise Company and discovered that in my region of Leeds city only 5.6% of young people are in apprenticeships; 33% of 16-year-olds and 30% of 17 to 18-year-olds are poorly prepared for work. That is on the Government website. That suggests to me that they have not had brilliant careers advice, even given the extra money that is available, so maybe that message is not coming through.

[Robert Halfon]

I will find out what the Careers & Enterprise Company is doing in Leeds and in the hon. Lady’s constituency. It will be involved with the LEP, but it has not been there for a long time; it is a recent creation. It has been working to identify the spots where we need help the most. I will look into what is happening and write to the hon. Lady.

On the copyright issue, the content of qualifications will be determined by employers, with the support of the institute. That is very different from the current system, where awarding organisations develop qualifications in subjects or sectors of their choosing. In some cases that is with the involvement of employers, but not always. The new technical qualification will be based on the skills, knowledge and behaviours that employers have identified as requirements for particular occupations. As the content of the qualifications will be determined with the institute’s oversight, it is perfectly reasonable and appropriate that copyright for relevant course documents should rest with the institute.

On the relationship between the framework and the new standards, the same organisations can deliver assessments for frameworks and new standards as long as they meet the criteria for assessment organisations for standards and are admitted on to the register of assessment organisations. The same position exists for training. Providers can offer training for both but need to meet the criteria and get on to the provider register.

When I was talking about careers, I forgot to talk about the investment we are putting into training, which the hon. Member for Blackpool South mentioned. The hon. Member for Batley and Spen gave examples of constituents who are not getting apprenticeships and described the low take-up. For those people, we potentially offer traineeships. We have spent £50 million on that. Many of those people—over 19%—are people with learning difficulties and disabilities.

In terms of Ofqual and Ofsted, I see it not as a problem but as a bonus that there are all these qualification organisations out there, maintaining the quality of apprenticeships and technical education. As the hon. Member for Blackpool South knows, Ofqual and Ofsted are responsible for different elements of the system; Ofqual regulates qualifications and Ofsted regulates the trainers and providers. The institute will regulate the quality of standards and assessment plans. I do not think that is a problem. It is a good thing that all those bodies are there, to ensure we get the quality technical education and apprenticeships we need.

[Gordon Marsden]

I will reflect on what the Minister said. Even if it is a good thing that there is a plurality of opportunities, I will reiterate two points. First, it does not make the judgment of what capacity the institute may need when competing in this marketplace any easier. Secondly, I hope the Minister will understand and accept that there are enough difficult organograms out there already in further and technical education without creating one with lots of little dotted lines here, there and everywhere. If he is going to maintain that position, it is important that lines of responsibility and why they work are clearly explained to stakeholders and employers.

[Robert Halfon]

The hon. Gentleman makes a fair point and I will reflect on what he has said, but I think it will be set out clearly. We are considering how the new technical education qualification should be regulated. The regulatory approach will need to be designed specifically for new qualifications and in the light of the institute’s contract management function. Ofqual remains the qualifications regulator.

I am pleased to turn now to the schedule and give an overview of what the Bill seeks to do. We have discussed much of it today. The schedule seeks to extend the remit of the Institute for Apprenticeships to give it responsibility for implementing reforms that we believe will raise the quality of college-based technical education. The reforms will result in technical education courses that are designed around employers’ needs, support young people and adults to secure sustained employment and meet the needs of our economy.

--- Later in debate ---

[The Chair]

Mr Marsden, may I make it clear that, if you are speaking to clauses subsequent to clause 2, no amendments have been tabled for clauses 3 to 12 either? We understand that neither the Opposition Front-Bench team, nor the Minister, wish to speak to these clauses. Is that correct?

[Robert Halfon]

Except for clause 2.

[The Chair]

So do we have the leave of the Committee to put the question—after the Minister has spoken—and we have dealt with clause 2, that clauses 3 to 12 stand part of the Bill?

--- Later in debate ---

[Kelvin Hopkins]

I have some experience in these matters. There have been funding pressures in all spheres of post-16 education, although not necessarily in universities, which seem to be well funded compared with other areas. In spite of the fact that there are advantages of scale in producing wide ranges of subjects in whatever qualification one is taking, some of the smaller subjects are, even now, dying. We are getting to a point where subjects such as modern European languages are being lost entirely from an area because no college or school will teach them any more. That is tragic. We should be creating more variety of opportunity in technical and academic education, not less.

My second major speech when I first came into this place was about funding for sixth-form colleges and the fact that they did a superb job. I said that funding constraints were in danger of killing the goose that lays the golden eggs: the sixth-form college sector. They do a fabulous job and I know from experience that we should have created more of them. Sadly, a view was held that we should create lots of schools with small, less efficient sixth forms with much narrower subject ranges, instead of sixth-form colleges. I think that went in entirely the wrong direction. I hope that I can persuade the Minister and others that we ought to look more favourably on sixth-form colleges and FE colleges if we are to make serious advances in educating and training our young people better than we have done in the recent past.

[Robert Halfon]

May I put some things in context for the hon. Member for Blackpool South before I speak directly on the clause? No one denies that there have been funding pressures, as the hon. Member for Luton North pointed out, but, even with such pressures, 80% of colleges are either good or outstanding, and 79% of adult FE students get jobs, move to apprenticeships or progress to university. Some 59% of institutions are in good financial health and 52% are operating with a surplus. That does not mean everything is rosy, but it puts things into context.

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[Gordon Marsden]

I have two observations: first, “protecting” is an interesting word when we are talking cash terms as they are not real terms. By 2020 inflation may have eaten into that figure. Secondly, the hon. Gentleman mentions the advanced learning loans, but are they not sums of money out there to be offered—and at the moment, only 50% of them have been taken up?

[Robert Halfon]

Yes, but it is still a Government expenditure item and its aim is to help more people take part in education.

Overall, the Department for Education plans to invest £7 billion in 2016-17 to fund education and training places for 16 to 19-year-olds. The area reviews will support those colleges that want to merge—no one is being forced to merge—and we will provide financial support where appropriate to help them do so. We are confident about the programme and we will deliver strong, sustainable colleges for the future. Mergers do not necessarily mean that provision in a local area will end. It will be up to the colleges to decide whether to keep a campus or site open.

The clause is probably the least technical of the Bill’s insolvency-related clauses. It explains that part 2 is about the insolvency of further education bodies and, in summarising what is covered by chapters 2 to 7, sets the scene for what we will debate over the coming sittings. Underneath the simple clause is the Government’s commitment to ensuring that every young person has the opportunity to achieve their full potential and to succeed.

The Secretary of State talked about the Government’s commitment to building a further education sector capable of delivering these skills and that is why we are supporting colleges through the area review to take whatever steps are needed to transform themselves into providers of the highest quality teaching. We are providing them with the opportunity to ensure they are in a strong and sustainable financial position for the future.

Once the area review recommendations have been implemented, the Government has been clear that we will no longer provide exceptional financial support to colleges that find themselves in financial difficulties. We will draw a line under what has become an implicit understanding among creditors and some educational institutions that those who fall into extreme financial difficulty will be able to rely on the taxpayer to make good the shortfall.

The provisions in the Bill will send a clear message to colleges that, to deliver excellence in teaching and leadership, they need to ensure that they have strong and robust financial controls in place. The commissioner who gave evidence said that, where there had been significant problems, much had been down to leadership and financial management. Why is it that so many colleges are doing extremely well, the college of the hon. Member for Blackpool South being an example?

Any college or creditor in extreme financial difficulties cannot look to the Government as the bank of mum and dad for a bail-out. The bank of mum and dad—the taxpayer—will be shut, because we have a duty to give taxpayer value.

Although we expect a college insolvency to be a rare thing, we cannot say it will never happen. That is why the measures the Bill introduces will ensure existing insolvency procedures apply to further education bodies, whereas ordinary insolvency procedures would offer protection only to creditors.

If I summed up this part of the Bill in a few words, it would be about protection, insurance, prudence and caution. Through the Bill we will introduce a special administration regime for the sector that ensures that, in the unlikely event that a college become insolvent, the Secretary of State or Welsh Ministers will be able to take action to protect the interests of the learners.

That is at the heart of the Bill: protecting learners and ensuring that colleges are cautious about borrowing and banks are cautious and prudent about lending. Young people entering a college expect to complete their studies, leaving with the skills that they need to move forward in their lives. That is the purpose of the SAR and I urge that the clause stand part of the Bill.

Question put and agreed to.

Clause 2 accordingly ordered to stand part of the Bill.

Clauses 3 to 12 ordered to stand part of the Bill.

Ordered, That further consideration be now adjourned. —(David Evennett.)

Technical and Further Education Bill (Seventh sitting)

Robert Halfon Excerpts

Committee Debate: 7th sitting: House of Commons
Thursday 1st December 2016 Public Bill Committees

[The Chair]

Members may remove their jackets during the sitting if they wish. Will everyone please ensure that all electronic devices are turned off or switched to silent mode? The selection list for today’s sitting is available in the room. I remind Committee members that we will consider clauses and schedules in the order set out in the programme order, which has been previously agreed and is set out at the end of the amendment paper. We will start with clause 13, to which no amendments have been tabled.

Clause 13

Overview of Chapter

Question proposed, That the clause stand part of the Bill.

[The Minister for Apprenticeships and Skills (Robert Halfon)]

It is a pleasure to serve under your chairmanship again, Mr Bailey. The clause is the first in chapter 4, which deals with the regime at the heart of the insolvency measures in the Bill. In this chapter, we make provision for the special administration regime that will make sure that students attending further education bodies in England and Wales are protected should that body fail. Hon. Members will be aware that the regime has been broadly welcomed by all, and I am grateful to the hon. Member for Blackpool South for welcoming it previously. That is not to say that there are no points of concern for stakeholders, but I hope to address those as we work our way through the clauses.

The clause sets out the when, the who and the what of the regime, which will be formally known as education administration. First, the when: the regime can be used when

“a further education body is unable to pay its debts or is likely to become unable to pay its debts”—

in other words, when an FE body is insolvent, based on the well established definition in the Insolvency Act 2000. Secondly, the who: an education administrator can be appointed by the court only on the application of the Secretary of State or Welsh Ministers, depending on where the FE body is based. Thirdly, the what: the education administrator will be responsible for managing the FE body’s

“affairs, business and property with a view to avoiding or minimising disruption to the studies of existing students.”

Each of those features is set out in more detail in subsequent clauses. I look forward to debating them with members of the Committee.

Question put and agreed to.

Clause 13 accordingly ordered to stand part of the Bill.

Clause 14

Objective of education administration

[Gordon Marsden (Blackpool South) (Lab)]

I beg to move amendment 1, in clause 14, page 8, line 4, at end insert—

“(3) Before an education administrator may perform functions specified in subsection (2), they must ensure an appropriate assessment is made and published of the impact of performing such functions, including, but not restricted, to—

(a) the impact on the quality of education provided to existing students of the further education body;

(b) the capacity of another body or institution to undertake any additional functions or provide education to additional students;

(c) the infrastructure of the local area, in particular transport;

(d) any impact on the travel arrangements of students to another body or institution; and,

(e) any financial impact on those students or any such impact on their travel arrangements, and what measures need to be taken to mitigate them.

(4) The Secretary of State shall make regulations to specify suitable bodies for making the assessments at subsection (3).”.

This amendment would ensure that an appropriate assessment is made of any potential impacts on students and their education, if an education administrator puts a further education body into “special administration” and takes action such as transferring students to another institution or keeps an insolvent institution open for existing students. This amendment would also require the Secretary of State to specify suitable bodies to perform such assessments.

--- Later in debate ---

[Gordon Marsden]

My hon. Friend again makes a very good point. It underlines our concerns and why we think such issues need to be taken into account.

Amendment 2 is designed to ensure that, within the circumstances in which the process takes place, all relevant stakeholders are fully consulted about decisions taken by the education administrator in respect of the future of the institution. This touches on a theme not dissimilar to that which we discussed during the debates on schedule 1 to the Higher Education and Research Bill, where consultation with staff and students was a high priority.

The amendment would ensure that there is full consultation with various bodies or groups representing further education staff and students. Members of the Committee might ask, “Is this necessary? Surely the students and the student body are bound to be informed,” but I have to say—Members may have experience of this—that is supposed to be the case when businesses fail and companies go bust or when something cataclysmic happens, but often workers or employees are not kept in the loop. We should legislate for the worst scenarios and the worst employers, not for the best.

It is important that the education administrator should consider representations from relevant stakeholders such as students and staff, as they have invested two or three years of their time and money in studying and their livelihoods will depend on the institution in question. It is surely not too much to ask that the education administrator should have the responsibility placed on him or her to consider those representations, too.

The other group it is vital to consult are recognised trade unions at the further education body. The positive influence of unions on training and skills in the workplace and in colleges is another key reason why unions should be consulted. Research by Unionlearn has shown, as I have mentioned before, that the union effect on skills across the whole economy is significant and has strengthened in recent years. I am obviously referring to the training that goes on at work, but often the trade union representatives who operate in a college will be either union learning reps themselves or closely associated with union learning reps. That point needs to be made. On the union learning fund, an independent evaluation has demonstrated a range of new findings about the positive impact of union learning for both employers and employees. That also has a bearing on the necessity and advisability of consulting the recognised trade unions at the further education college in question.

I will finish with those remarks, but I ask that the Minister gives some thought to both amendments. These are things that should happen, and by making the amendments we would ensure that they do happen.

[Robert Halfon]

I thank the hon. Gentleman for his thoughtful amendments. I will comment on a few of the points he made, then go into the substance of the amendments.

The hon. Gentleman will know that the AOC, the Sixth Form Colleges Association and the Collab Group work closely with the Government and will continue to do so as we develop secondary legislation to address their concerns. On trade unions, I will come on to the general point about consultation, but first let me quote the TUC:

“Whilst the TUC continues to express concerns about the financial pressures colleges are facing due to the major cuts to the sector…we do welcome the new safeguards that will enable students to complete their courses in the event of a college becoming insolvent.”

In addition, we have committed £12 million to Unionlearn.

The hon. Gentleman asked where the funding was coming from. Crucially, clause 25 states that the Secretary of State will have the power to fund special administration as long as the funding is for the purpose of achieving a special objective through either a grant or a loan, and the decision on funding will obviously be taken on a case-by-case basis. The whole purpose of the education administrator is to speed things up. If we look at this in a general context, at the moment there is no protection; there is nothing. We are creating a protection regime for students with the purpose of ensuring that the education administrator acts quickly.

The hon. Gentleman talked about an exodus of staff. If colleges reach such a situation, it is likely that there will have been some kind of intervention, perhaps by the FE commissioner, way in advance. I do not think that would suddenly come about just because of the insolvency regime. All staff will be subject to statutory legislation on terms of employment and so on. That is worth noting. There cannot be a one-size-fits-all solution.

I am talking as though these circumstances will arise regularly. They will not. The whole purpose of the SAR is, as I said last week, to be an insurance against the worst possible outcome, which I think, given what is happening with the area reviews, will be very rare indeed.

[Gordon Marsden]

I understand that this will have to be done on a case-by-case basis, but has the amount of money that might be needed in a calendar year to deal with this been assessed? Obviously, it will have to be agreed with the Treasury. The Minister says he does not think this scenario is likely, given the area reviews. I hope he is right, but I am very conscious that the FE commissioner said the number of colleges that may merge on this basis might be in the 80s. Surely there might be problems with at least some of those, and surely that should have been taken into account.

[Robert Halfon]

There is a substantial restructuring fund, which I believe is about £756 million. As I say, funding of a SAR has to be done on a case-by-case basis because every case will be completely different. It will be up to the education administrator to decide how to proceed. The hon. Gentleman mentioned the different options.

[Tracy Brabin (Batley and Spen) (Lab)]

Before I make my comment, I thank the Minister for his letter this morning on the Careers & Enterprise Company. I was grateful to receive it and I thank him for sending it in such a timely fashion. I have been monitoring the situation locally, and if things work, I will be encouraging other sixth-form departments in schools to get involved, because some schools are not doing so.

The Minister says that the measure will speed things up, but there is one thing on which I could do with some clarification. Clause 23 relates to transfer schemes. The explanatory notes say that:

“Such schemes can be used to override some third party rights, e.g. transferring a lease without the landlord’s consent”.

I want to double-check something. If that were to happen with Kirklees Council and someone wanted to take back a building, that could lead to some sort of legal dispute. Would that not hold up the transfer of the students to another college and the process of their learning?

[Robert Halfon]

Will the hon. Lady allow me to think about that example? We will consider transfer schemes in detail later, but I do not think the issue she highlights would arise. The transfer schemes are particularly about looking after the students and establishing who the provider is if the existing college management are no longer looking after the students. There might be a different provider, but we will come on to that point later in our consideration.

[Mr Ranil Jayawardena (North East Hampshire) (Con)]

Is not the point, as we heard in the evidence from the banks, that some banks may take a view that they should realise their security? The provision allows for learners to be prioritised in any transfer or land, property and so on, so that that is to their interests. They should come first.

[Robert Halfon]

My hon. Friend has it exactly right. He asked that question in our evidence sessions, and one of the banks said, “No, our whole purpose is to act in the interest of the lenders.” The whole purpose of this provision, however, is to act in the students’ interest. Creditors will get a fair deal, but one that is in the interest of students.

I will come on to transfer schemes in a minute. The area review mergers are different, but it is important to quote Richard Atkins, the FE Commissioner, from the evidence session. He said:

“Mergers do not necessarily mean the closure of sites, so they do not mean the end of provision for students locally. Clearly, in rural areas, for example, the history of the sector has been that provision has not gone even when there have been mergers. When Truro and Penwith came together, that did not end provision in Penzance. In fact, it regenerated the provision in Penzance to a higher standard. You can see that across the country.”

I accept he is talking about area reviews, but he went on to say:

“The idea that you close provision down in a particular district, borough or town is not something I would be in favour of at all. I would be looking for merger solutions that bring together back-room services, avoid duplication and so on.”––[Official Report, Technical and Further Education Public Bill Committee, 22 November 2016; c. 26, Q34.]

This will not always be the case, but it is important to say that a merger does not necessarily mean the closure of provision in an area.

[Gordon Marsden]

I entirely accept what the Minister has just said, but at the risk of over-stressing the point, decisions about transferring students can affect the closure of courses. The closure of courses is not necessarily the same as closing a site, but it can have a deleterious effect on an area. One can think of a college where lots of people are doing accountancy and that course becomes no longer available in that town, even though the college is still going to be there. That is the only point I want to make. The issue is broader than simply saying, “You either close the college or you don’t.” There is a suite of potential impacts there.

[Robert Halfon]

I accept that completely, but I was just trying to again make the point that currently if a college has financial difficulties, it can close a particular bit of provision and no one has any guarantees whatever. This measure will change that.

On the transfer schemes, it is important to talk about the statutory duties. We all know that under the Education Act 1996, the Secretary of State has a general duty to promote education and exercise his or her powers

“with a view to…improving standards, encouraging diversity and increasing opportunities for choice.”

Local authorities have a duty to ensure that their areas have sufficient education and training provision. They also have a duty to publish a transport statement setting out what arrangements they consider necessary to support young people to access education or training.

The hon. Gentleman mentioned education maintenance allowance. We took the view that we want to give funds to those who most need it, and the problem with the education maintenance allowance was that it went to everyone. It was paid to 45% of all 16 to 18-year-olds in further education and it was not income-related, which is why we introduced the 16-to-19 bursary fund.

[Gordon Marsden]

I hesitate to cross swords with the Minister but I think that is factually not entirely correct. The education maintenance allowance came in at least two—I think were three—different tiers. The top tier, which from memory was about £30 a week, was specifically focused in many cases on travel. I do not wish to move outside of the scope of the amendment, Mr Bailey, but it is important to make this point: subsequent assessments of the impact on students who had had it taken away showed significantly that the travel aspect of the different elements was most well regarded. I am not here to open up a debate about EMA—we have given our points of view—but it is important for the Minister to take those points on board.

[Robert Halfon]

I do, but an independent evaluation found that only about one in 10 of those who received EMA said that they would not be able to participate without it. That is why we introduced the 16-to-19 bursary fund—to ensure that the money goes to those who need it—which amounts to £177 million for 2015-16. That is why, as the hon. Gentleman knows, I campaigned successfully with the hon. Member for Scunthorpe (Nic Dakin) for free school meals for students from disadvantaged backgrounds in FE colleges. The Government are spending £39 million on that. That is separate from the £500 million that is given to the FE sector to spend on what FE bodies like, but primarily for helping the disadvantaged. The Government are doing everything that they can to ensure that those in need are getting the right support.

Let me move on to the substance of the amendment. We want to be sure that, as far as possible, if their college finds itself in financial distress students are able to continue their studies with little or no disruption. The clause does that by setting out the overarching objective for the education administration: to “avoid or minimise disruption” to the students.

The hon. Member for Blackpool South noted that the special objective can be achieved in a number of ways, and we do not believe that one size fits all. It could be done by rescuing the body as a going concern, with a new principal and governors if necessary; by merging with another body, perhaps another college nearby; by keeping the college open to teach out the existing students; or by arranging for students to transfer to another college to complete their studies. That list is not exhaustive, nor is it intended to be prescriptive. There may be other options, and those are not intended to be mutually exclusive. Occasionally some students might be transferred to another college and others taught out. It will be for the education administrator to decide what is best, based on the circumstances of each case.

I appreciate the suggestions made by the hon. Gentleman, but I assure him that it is inconceivable that the education administrator would take decisions on how the special objective would be met without first having had conversations with a wide range of stakeholders. Let me be clear: I and the Government would expect, in an appropriate case, the education administrator to liaise with the FE commissioner—that view was shared by the FE commissioner last week in his evidence—who might be able to advise the education administrator whom they should be speaking to in addition to staff, students, local authorities and the other providers. We would expect that the EA, in seeking to fulfil the special objective to avoid or minimise disruption to students’ studies, would seek to satisfy themselves that, as far as possible, the quality of the education or training that students have been receiving at the college is maintained. That may be achieved by transferring students to another provider or by continuing to teach them in the FE body until they complete their courses.

We expect the education administrator to take travel distances into account when considering the transfer of students to another provider, on the basis that the special objective is about avoiding or minimising disruption to the studies of existing students. Where possible he may choose to take into account the generally used guideline of travel for learners of no more than 75 minutes to and from their place of study, even though the FE commissioner observed to the Committee that some—not all; not those who are not able to—learners are happy to travel considerable distances for the right provision.

I understand the concerns that amendment 1 seeks to address in relation to additional transport-related costs for students in the event that they are transferred to another body. For those who are transferred, there may be scope for the EA to set up a scheme to cover some or more of the additional travel costs from any funding provided by the Secretary of State or Welsh Ministers, as I highlighted a moment ago in terms of clause 25. Although there is no obligation on FE bodies to provide student transport, it is open for them to use the resources that are available to best support their students because, as I mentioned, disadvantage funding is not ring-fenced. Where students attract such funding, FE bodies can decide upon the most appropriate offer for their students. Often they do give those students free transport.

The education administrator will want to be sure that in deciding the right option for dealing with the particular body in insolvency, they have assessed a wide range of factors, including those set out in the amendment, calling on advice and input as necessary from those best placed to help. It is therefore unnecessary for the Secretary of State to make regulations to specify “suitable bodies” for making the assessments described in the hon. Gentleman’s amendment.

We are keen to strike the balance between a fair and thorough process that generates well thought through conclusions, and a system that is not so rigid that it ends up working against the interests of students by being drawn out and cumbersome. The hon. Gentleman observed that himself. The longer it takes to end the education administration, the longer students face uncertainty and possible disruption. The number of FE bodies and their different circumstances mean that there would be no single solution in the event of an insolvency, and the education administrator needs the flexibility to be able to do what is right in the circumstances.

As the hon. Member for Batley and Spen said in the evidence session on 22 November, we need to give students certainty about what will happen as quickly as possible; that is as much true for the staff, and for the creditors. Of course, if students, or anyone else, are unhappy with the EA’s actions, they can bring their concerns to the attention of the Secretary of State, or the Welsh Ministers, who have the power to be able to challenge the education administrator through the courts if the EA is not carrying out their functions for the purposes of achieving the special objective or the objective relating to the creditors.

I recognise the intention behind the amendments and believe that, as much as possible, the Bill covers the issues that the hon. Gentleman has raised. I hope that he is reassured enough to withdraw the amendment.

[Gordon Marsden]

I am grateful to the Minister for the detail that he has gone into. It is particularly useful that he made the point about there being scope for the EA to get supplementary funding in certain circumstances. That is welcome. We may want to look again at this issue on Report, but at the moment I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 14 ordered to stand part of the Bill.

Clause 15

Education administration order

--- Later in debate ---

[Robert Halfon]

I again thank the hon. Gentleman for his remarks and his thoughtful amendment. I not only understand the concerns but, when looking at the Bill in the early stages, asked those questions myself. I hope that I can reassure him. I will answer some parts of what he said and then go into the substance, if I may.

On a point of clarification, it will be for the Secretary of State or the Welsh Minister to decide whether to apply for an education administration order, but they can do so only if the FE body is insolvent in accordance with the definition in clause 17—if it is unable or unlikely to pay the debt. It does not happen automatically.

The hon. Member for Blackpool South will know that insolvency practitioners are very qualified individuals—usually accountants or insolvency specialists. Practitioners with experience in FE and education do exist; I met one only a few days ago who happens to work for the Skills Funding Agency, to talk through these very issues. However, we must make it clear that according to the laws of insolvency, only insolvency practitioners can legally act as office holders in insolvency proceedings—liquidators, administrators and administrative receivers of companies. They are regulated through the Insolvency Act 1986.

The key qualification of the insolvency practitioner to deal with an insolvent college is their expertise with respect to a business or non-profit-making organisation that is insolvent. There are special administrative regimes in other areas such as utilities and the postal service. In addition, they can draw on the knowledge of the governors and staff at the college, and the wider sector. As I said in a previous debate, it is possible—it is most likely—that the insolvent college will have undergone a period of intervention before becoming insolvent, so the education administrator will also be able to consult the Further Education Commissioner. I repeat—I want it to be clear—that we would expect, in an appropriate case, the Education Minister to liaise with the FE Commissioner.

It has also been said that it is inconceivable that the education administrator would take decisions on how to meet the special objective without first having conversations with the range of key stakeholders. Mention has been made of Mr Harris’s evidence to the Committee. He said:

“From an insolvency practitioner’s perspective, it is worth standing back and recognising that insolvency practitioners are not train drivers, or people who spend their life in the railway or the London Underground, when it comes to a special administration regime, nor are they specialist property developers. They come to each situation afresh. One comforting thing that insolvency practitioners bring is recognising when they need to keep in place the existing management structure in a corporate sense, or the workforce in a pastoral sense, recognising that those people have skills and qualifications that they as an office holder do not necessarily have, and also recognising that they can bring outside specialist help to continuing the duties of education administrator, should the need arise. That is all part and parcel of any trading insolvency regime, and I would imagine that any office holder stepping into the role of an education administrator would have that at the forefront of their mind. I do not think it presents a unique challenge; it is very similar to all the other special administration roles. There is an extra dynamic—there is a pastoral element.”––[Official Report, Technical and Further Education Public Bill Committee, 22 November 2016; c. 46, Q60.]

Of course, as Stephen Harris pointed out, when an institution is insolvent, there is a critical need for someone who understands and can deploy the tools necessary to ensure that the education administration is properly managed. Given what I have told the Committee, we expect that that is exactly how the education administrator will operate. Many insolvency practitioners come from big companies that have huge amounts of expertise in a range of fields, including education. The leadership team of the FE body would be in place to provide support on the day-to-day running of the college and information to assist the education administrator in his task of achieving the special objective. So would the Further Education Commissioner and Sixth Form College Commissioner and their teams, and officials in the Department for Education. That is how the interaction between the various bodies highlighted by the hon. Gentleman works.

Of course, the education administrator will be free to seek advice from any other source, but I think that introducing unnecessary requirements as to the appointment of an education administrator would limit the pool of insolvency practitioners from which we could draw, in the event that we needed to use the special administrative regime.

[Mr Jayawardena]

The Minister is making a very important point. Does he agree that the arguments the hon. Member for Blackpool South outlined earlier about the complexity of such insolvency regimes and the unwinding, possibly, of certain troubles that FE colleges might get into—on rare occasions, as the Minister said—is actually the reason why it is important that insolvency practitioners are the people appointed to deal with these situations, because they are aware of how to deal with these complexities?

[Robert Halfon]

My hon. Friend is exactly right, but the crucial thing—I must mention this at almost every opportunity—is that it is unlike when I have seen receivers come in in my constituency who just care about the creditors. If I may just speak personally for a moment, I remember being in a hotel with the staff, some of whom lived on the premises, and the receiver literally said they had to leave on that day, when they had lived there for a long time. This situation is completely different. The whole purpose of this measure is that that kind of individual will not be involved. There will be somebody who has to fulfil the special objective of protecting the students.

[Gordon Marsden]

I accept that, and for the avoidance of any doubt, and with respect to what the hon. Member for North East Hampshire has just said, I did not at any stage query the fact that it would need to be an insolvency practitioner. The Minister is saying some reassuring things. The only point I would gently make to him is that there is a difference between saying that someone has to acquire a set of skills that might be tested by some mechanism or other, and having a sense of—I think Stephen Harris talked about a “pastoral element”; perhaps I would have said “empathy”, which is possibly the same thing. I am sure that aspect has given the AOC some pause for thought, because I do not know—perhaps the Minister does—how many insolvency experts have the admirable background of the gentleman he met.

[Robert Halfon]

The gentleman I met has a direct background, but as Stephen Harris said, that is not necessarily a requirement. However, it is inconceivable that the individuals involved will not have access or that they will not be working with all the relevant institutions. Having said that, they have to be first and foremost an insolvency practitioner, according to the law, but with the special objective.

Given that, I hope that the hon. Gentleman is more reassured and will agree to withdraw the amendment.

[Gordon Marsden]

We have had a helpful exchange and it has been useful to probe on this issue and in particular the relationship with the Education Funding Agency. The one point the Minister has not answered—I do not ask him to come back on it now, but it would be useful if he produced a note—is the point that I raised about the different measures of financial performance.

[Robert Halfon]

If the hon. Gentleman is happy for me to do that, I will. We will always require different information to test different issues, for different institution types or in different circumstances. There is a continuous improvement process for the systems and processes for identifying financial risk. The whole function of the area review process is to use it, where relevant, to review the financial management processes. I hope that answers his question some way.

[Gordon Marsden]

I am not entirely sure that it does, but I will not pursue the matter. However, these are technical issues and ones that I am sure the AOC and others may wish to take up with the Minister in a less formal capacity.

I am reassured by what the Minister has said today so far. The organisations may wish to probe further on some of the details, but I am happy to beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 15 ordered to stand part of the Bill.

Clauses 16 to 21 ordered to stand part of the Bill.

Clause 22

General functions of education administrator

Technical and Further Education Bill (Eighth sitting)

Robert Halfon Excerpts

Committee Debate: 8th sitting: House of Commons
Thursday 1st December 2016 Public Bill Committees

[The Chair]

I remind the Committee that with this we are discussing amendment 4, in clause 22, page 10, line 7, leave out “(if possible)”.

This amendment would ensure that the primary concern of the education administrator is the special education administration objective, that is minimising disruption to learners.

[The Minister for Apprenticeships and Skills (Robert Halfon)]

I will answer one or two of the questions asked by the hon. Member for Blackpool South. If I understood correctly, he was asking about safeguarding. I assure him that the statutory obligations that apply to colleges will transfer to the special administrator during the special administration period.

The hon. Gentleman mentioned one bank. To clarify, the chap from Santander, Gareth Jones, told the Committee in evidence:

“On the Bill and the proposed insolvency regime, we are actually supportive of the clarity that they provide.”

He also said that

“we are still…looking to grow our exposure to the sector and grow our lending book.”––[Official Report, Technical and Further Education Public Bill Committee, 22 November 2016; c. 38, Q41.]

Later, he said:

“From a risk perspective, when we assess the underlying risk of a transaction, there has always been that uncertainty and we have had to make assumptions in the background. If the Bill is passed, the certainty it will provide is positive for us.”––[Official Report, Technical and Further Education Public Bill Committee, 22 November 2016; c. 41, Q46.]

Different banks have different views on the issue.

Clause 5 and schedule 3 allow the education administrator to dissolve a statutory corporation if no property is left for the creditors’ book, which will usually be after students have had benefit protections from the special objective. The hon. Gentleman will know that there is a special provision in the Bill to protect students with special educational needs, which is important. The education administrator is additionally bound by the duties that apply to the college in relation to SEN students. There is no protection at the moment—nothing.

[Gordon Marsden (Blackpool South) (Lab)]

This relates to the point we discussed earlier. It is not so much about cost as about distance. The Minister said earlier that the provisions currently allow students to transfer on the basis of up to 75 minutes’ travel time. This cannot be included in the Bill—we are all planning for the worst and hoping for the best—but it should be taken into account that if, for the sake of argument, a college with a significant number of SEN students goes insolvent, it might be possible to ensure that any transport provided is disability friendly. If a college with a relatively small number of SEN students goes insolvent and those students have to travel a fairly long way, it would create additional difficulties. I am not asking for anything to be put in the Bill, but I ask him to take that into account in the guidance notes.

[Robert Halfon]

I will reflect on that important point, but the Bill makes it clear that the administrator has to protect not only students, but special needs students. The administrator will be under the same obligations as the college in relation to the Equality Act 2010. That is an important part of the Bill.

My hon. Friend the Member for North East Hampshire said that clause 14 is one of the most important in the Bill. Clause 22 is equally important, and it should be considered not in isolation, but in conjunction with clause 14. It is the backbone of the special administrative regime and distinguishes it from ordinary administrative processes. While clause 14 enshrines the overriding purpose of the special administrative regime—the protection of students through the special objective—clause 22 gives the education administrator the power to manage the FE body’s affairs, business and property, and it places a requirement on the education administrator to carry out their functions for the purpose of achieving that objective.

Clause 14 makes it clear that student protection is the primary purpose of the special administrative regime. Reading clauses 14 and 22 together makes it clear that the education administrator’s primary purpose is to achieve the special objective. I hope that explanation reassures the hon. Member for Blackpool South and that he will agree to withdraw the amendment.

[Gordon Marsden]

I am grateful for the Minister’s remarks and for our short exchange on the situation for SEN students. I am particularly grateful to him for emphasising the relationship between clauses 14 and 22. It is important that he has stated in Committee the primary purpose of the education administrator; if in future there are any doubts or concerns about the interpretation of the clause, that will be an important point. I thank him for his response and I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Kelvin Hopkins (Luton North) (Lab)]

I will be very brief. I support my hon. Friend. One of the problems for the FE sector and, even more, for sixth-form colleges is that the whole sector has been bedevilled by decisions being made by people who are unfamiliar with those sectors. Many people involved in politics have come through a school or university environment; they have not been through further education. Many areas do not have sixth-form colleges, so people are not quite sure what they are. It is important that we have people with knowledge of the sector—educationally and organisationally —to make judgments on these matters. I just wanted to support my hon. Friend with those few words.

[Robert Halfon]

I appreciate the amendment. I raised these issues in the previous sitting. I go back to the quotation from Stephen Harris, the insolvency expert, who said that

“it is worth standing back and recognising that insolvency practitioners are not train drivers, or people who spend their life in the railway or the London Underground”––[Official Report, Technical and Further Education Bill Public Bill Committee, 22 November 2016; c. 46, Q60.]

Those people are expert insolvency practitioners, but many have some kind of educational link or work for a company that has a good link with and expertise in education.

It would be inconceivable that any education administrator would not consult—I strongly expect them to—key stakeholders, particularly the FE commissioner, student bodies, governors, parents and any relevant sponsor or other stakeholder involved with an insolvent college. That is expected as a matter of course, but I will reflect on what the hon. Member for Blackpool South said. On those grounds, I hope that he is happy to withdraw the amendment.

--- Later in debate ---

[Gordon Marsden]

I am grateful to my hon. Friend for underlining that point and giving that practical example of a personal issue. Perhaps I can be forgiven for mentioning that the shadow Secretary of State, my hon. Friend the Member for Ashton-under-Lyne (Angela Rayner), has herself strongly expressed how crucial further education was to her during her teens. She said on Second Reading that she would not have been there to present our view on the Bill had she not had that experience, when she was in that vulnerable situation as a teenager.

There are groups of people who must particularly be thought about in this context. We discussed care leavers on another occasion, and the difficulties that many of them face, but it seems particularly appropriate to discuss them again in the context of the amendment. In their apprenticeship funding proposals last month, the Government recognised that apprentices aged 19 to 24 who had previously been in care, or who had had a local authority education, health and care plan, might need extra support. The majority of respondents to their survey supported that—more than twice as many providers agreed with the proposal than disagreed. The Government have pledged in the proposals to give extra funding to employers who take on someone who was previously in care or had a local authority education, health and care plan. We applaud that as a good start, but it is important to think about legislating further and to guarantee that other necessary steps are taken to ensure that access and opportunity are available to care leavers.

Looked-after children often achieve less highly at GCSE, as my hon. Friends have noted, partly because they may have a chaotic family background or a history of abuse. The Special Educational Consortium stated in written evidence that young people who have a care plan at age 15 are more than twice as likely not to be in education, employment or training at 18. Barnardo’s said:

“These young people often leave school with few or no qualifications and need alternative options outside of the school environment if they are to achieve their potential. Some need provision that allows them to catch up on what they have missed. These young people also often want the option of practical-based learning that clearly links to a real job.”

While we are on the subject of care leavers, how does the Minister envisage the proposals to support apprentices, and the proposals that we would like to see taken on board more generally in respect of care leavers, linking up with the work done in the children’s services section of the Department for Education? In particular, what discussions has he had about the Bill with his hon. Friend the Minister for Vulnerable Children and Families, the hon. Member for Crewe and Nantwich (Edward Timpson), or his officials? I have credited him before for the assiduousness with which that part of the Department introduced the responsibility up to the age of 25.

The amendment also includes parents and carers, who for numerous reasons might be particularly affected by changes to their study arrangements. They may have particular arrangements for their children or dependants that might not be addressed by simply transferring them to another college. What happens if the college to which they are transferred is not as near to their children’s school? What if the new institution’s timetabling disrupts routines for those they care for, or their ability to be there for their children? What if potential increases in travel costs negatively affect the carefully planned budgets of those with caring responsibilities, affecting both their access to education and the care that they can provide to their own children and loved ones?

There will be others with particular needs, which is why the amendment has flexibility built into it to accommodate them. For all those reasons, the education administrator’s decisions must be carefully thought through, so we feel that it is important to require the administrator to do so. I know that there is a school of thought that says any decent education administrator, given the background, qualifications, empathy and pastoral issues to which the Minister referred, would do so, but I do not think that it reflects doubt about the good intentions of particular people in particular circumstances to say that they might be beset by a series of difficult decisions and priorities, probably within a relatively constrained period of time. It does not indicate that people would not think about the groups concerned. It is important in that pressurised situation that they are reminded of the importance of those particular groups. That is the basis on which we have brought forward the amendment.

As my hon. Friends have said, those groups already face challenges and barriers to education that it can be difficult for others even to imagine. I can imagine some of it. That is not from the perspective of being a teacher or tutor in further education, but from my perspective of having been a part-time course tutor with the Open University for nearly 20 years. I do not think I had many care leavers, but I certainly had people who were carers and who came into other distinct categories. I marvelled at the determination with which they took forward their studies under some trying and difficult circumstances. I believe that our proposal is the right thing to do, and I would welcome the Minister’s thoughts on whether the Bill needs to say rather more about the particular needs of these groups of students.

[Robert Halfon]

I am going to do the opposite to the hon. Gentleman: I will talk about the broad thrust and then answer the specific issues. I thank him again for his thoughtful contribution. I have already explained that we are introducing protection for students in the unlikely event that their college or provider becomes insolvent. The special objective will require the education administrator to take action to avoid or minimise disruption to their studies, by whatever means they consider appropriate.

However, the Government recognise that the education administrator might find it harder to find, or will need to think more carefully about, suitable alternative provision for those students with special educational needs, compared with the general student body. We do not want those students to be disproportionately affected by the exceptional event of college or provider insolvency, which is why we have placed a requirement on the education administrator —set out in clause 22(3)—to have particular regard to their needs.

We have had a lot of preliminary discussions about SEN students, because two thirds of care leavers are SEN students. We included provision for SEN in the Bill because of the particular difficulties such students face. There might be the need for specialist equipment or adaptations to teaching, or there might be a transport issue, and it is a requirement that the education administrator considers those in developing their proposals.

[Gordon Marsden]

Will the Minister give way?

[Robert Halfon]

I will answer the hon. Gentleman’s points. If he wants to raise a different point, I am happy to answer it, but I ask him to have faith in me. I have tried to answer questions as much as I can all the way through.

[Gordon Marsden]

I am not suggesting that the Minister has not.

--- Later in debate ---

[Robert Halfon]

I need to set this important issue in context. We already make good special provision available for post-16 education. Care leavers are a priority group for access to the vulnerable student bursary, which provides financial assistance. Care leavers receive yearly bursaries of up to £1,200—it is pro rata for part-timers. As care leavers, their eligibility for that support will not change, even if they are transferred to another provider as part of a college insolvency.

Alongside the vulnerable student bursary is the 16 to 19 bursary fund, which I discussed earlier. It is a discretionary fund targeted at young people and allocated to schools, colleges and training providers, which make awards to students. It is up to the college to define eligibility criteria, because it will know the needs of its students best. It is targeted support at a local level.

I am pleased to say that the Government have changed the law to improve how young carers and their families are identified and supported. For the first time, young carers have the right to an assessment of their need, no matter who they care for, the type of care they provide or how often they provide it. The assessment will consider their educational needs and will not be affected in the scenario where the student has to transfer college providers.

In answer to the specific question about care leavers, as the hon. Member for Blackpool South has pointed out, at this stage we have not included the requirement for the education administrator to take account of the needs of care leavers. As I have said, it is an issue that I will reflect on seriously.

[Gordon Marsden]

The Minister has been very helpful, and I appreciate that, but before he concludes, I have a definitional question that I think relates to what he has been saying. Subsection (7) refers to “special educational provision” and subsection (6) refers to a student with “special educational needs”. I have heard everything he has said about young carers, but is it his understanding that young carers or care leavers would automatically come under those categories? I know this is a narrow point, but it is quite important, because it influences whether further definition is necessary in the Bill.

[Robert Halfon]

No. It applies only to what is classed in statutory terms as an SEN student. That is why I have acknowledged that college insolvency is disruptive, especially to SEN students and care leavers. By the way, I should say that it was very gracious of the hon. Gentleman to mention the apprentice funding to make sure that care leavers are employed as apprentices, which is something I care deeply about. I am glad that he acknowledged that funding.

I want more time to reflect on what more might be done in the context of a college insolvency, to ensure that the Government live up to their promise of being an effective corporate parent. I will reflect on that.

[Gordon Marsden]

I am grateful to the Minister for that and for his promise to reflect on this issue and on the catch-alls in the clause as drafted. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

--- Later in debate ---

[Gordon Marsden]

Briefly, we have had some useful exchanges on the amendments, which I have been content to withdraw. I am broadly very pleased and satisfied with the points the Minister has made.

However, as I have said before, if this process—the Bill, the new institute, the new insolvency clauses—is to be a success, it is incumbent upon us to take as large a group of people from across the stakeholders with us as possible. I want to refer to a couple of issues that the Association of School and College Leaders and the Association of Employment and Learning Providers have raised in their written evidence. As the Minister knows, the ASCL in particular is quite critical of part 2 of the Bill because it thinks it is the result of rushed consultation. That is for others to judge, but the point it makes in its written evidence, which I would like a response to, is this:

“FE and sixth form colleges were created as exempt charities by Act of Parliament… As such college corporations cannot resolve to remove their charitable status. ASCL…is concerned that applying aspects of the Insolvency Act that applies to companies runs the risk of jeopardising that status. The Charities Commission does not appear on the list of those consulted…The primary duty of a corporation/governing body is to maintain the solvency of its college. Where it fails in that duty by negligence or worse, the Charities Commission has the power to investigate and bar governors/trustees from further service.”

If the Minister is able to, I would ask him to address that issue from the ASCL.

The AELP makes another point about the status of colleges. It believes that

“this reclassification should be reviewed by the ONS. This is not merely a technical point. Some colleges have reportedly used their current ‘independent’ status to resist Area Review proposals which is well within their right. However, when AELP has argued that the Government is using a form of state aid to assist colleges…we have been told by the SFA that colleges are ‘community assets’ which justifies the further injection of public funding. The insolvency measures in this Bill would…appear to place colleges very much back in the public sector.”

It says that this has become a “murky area”.

Those are two specific observations from two important stakeholders in the area. In the context of the clause, given everything else that we have been talking about in terms of the general function of the educational administrator, I would be grateful if the Minister would comment on those points.

[Robert Halfon]

I will give a brief response. The Charity Commission does not appear in the list of respondents because it did not submit a formal written response. However, we worked very closely with it during the development of the proposals in the Bill.

Charities that are companies and charitable incorporated organisations are all covered by insolvency legislation, and the Company Directors Disqualification Act 1986 regime for disqualification applies to those organisations. The Charity Commission has been fully supportive of the approach that we have taken and sees it as being in line with the approach taken for trustees of charitable companies and charitable incorporated organisations.

With regard to the AELP, the process of implementing a SAR would not automatically mean reclassification for an individual college, let alone the entire sector, because the Government would not be directly influencing the college’s corporate policy.

Question put and agreed to.

Clause 22 accordingly ordered to stand part of the Bill.

Clause 23

Transfer schemes

[Gordon Marsden]

I beg to move amendment 7, in clause 23, page 10, line 31, at end insert—

“(2) The education administrator may not transfer assets of any further education body to a private company where he or she considers that more than half of the funding of the acquisition of the asset came from public funds.”.

This amendment would ensure further education bodies with a track record of accruing assets publicly, could not be transferred to a private company.

We come to an amendment that is longer than the clause it seeks to amend. That might suggest that the amendment is otiose, but I do not think it is; I think the clause ought to have been expanded a little more— but then I would say that. I want to focus some attention, at a certain length, on this issue. On our side of the Committee, that raises some really big issues about what would happen to the transfer of assets from a further education body to a private company.

Information produced by the Department for Business, Innovation and Skills on the dissolution of an FE corporation specified that assets should be transferred only to charitable bodies:

“The Secretary of State and the CESF are concerned with the appropriate use of those capital assets that have been acquired/developed/redeveloped with public funding and the conditions for their transfer and usage…FE corporations are advised to undertake early discussions with the Skills Funding Agency to identify the relevant assets and any potential repayment of some, or all of the associated grant or proceeds of sale…The regulations include a requirement that the FE Corporation publish the proposed arrangements for the transfer of the property, rights and liabilities of the FE Corporation…The Dissolution of Further Education Corporations and Sixth Form Colleges Corporations (Prescribed Bodies) Regulations 2012”—

that would have been an interesting secondary legislation Committee to sit on—

“lists the bodies to which an FE Corporation can transfer its property rights and liabilities upon its dissolution. It is expected that all transfers should be made to charitable bodies, and for the purpose of education.”

It is on that point that I want to focus my remarks on the amendment. The document continues:

“Where the bodies are not charities then it must be transferred in accordance with the charitable purposes of the trust.”

It then links to a whole list of prescribed bodies to which assets could be transferred, including sixth-form colleges and governing bodies.

The point I start from is that to say it is “expected” that all transfers should be made to charitable bodies is not the same as saying it is “required”.

--- Later in debate ---

[Kelvin Hopkins]

I strongly support my hon. Friend’s case. This is something that I am alarmed about. The reality was that, at incorporation, hundreds of thousands of acres and hundreds of buildings were transferred without charge from the local authority and incorporated in bodies that still seemed to be essentially in the public sector and were still largely funded by it—sixth-form colleges are entirely funded by the public sector. The idea that they could be sold off to speculators for profit, with development value acquired and millions of pounds made, is completely unacceptable. If anyone ought to have that asset, it is the public sector: either local authorities or a central Government Department. If they so choose to sell land off, at an appropriate value—if it has planning permission for housing or whatever—that development value should accrue to the public purse as well.

I have some experience and, as always, knowledge of what has been happening recently. Indeed, one college had a large area of land associated with it that had been a sports field that was still used for sports but was also a local leisure amenity. The principal wanted to sell that land off for housing development, making a vast amount of profit, and the implication was that he might have benefited personally. He was known to be assiduous in making sure his pocket was well filled. I think he managed to pay himself the highest salary of any college principal in the country even though his was not one of the largest colleges. Be that as it may, he eventually left in some disgrace and the college is now recovering, but selling off land for personal profit was a temptation that clearly affected him.

The principal was also building an academy chain by getting schools to become academies and then trying to get them into his ambit. It is interesting that two of the schools had land attached, and when, some way through the deal, it was decided that he could have the schools but not the associated land, he lost interest in getting them into his academy chain. It was clear that he was interested in the land associated with those schools, not in the education of the children, the success of schools or whatever. When big money is involved, college principals and others involved in college life can be tempted by the prospect of substantial personal financial gain. That has to be guarded against, and the way we do that is by ensuring that the assets stay in the public sector and that any benefit, financial or otherwise, accrues to the public sector.

The amendment therefore goes some way towards what I would like to see, and I will certainly support it should my hon. Friend the Member for Blackpool South press it to a vote, but I think we ought to go further and ensure that those kinds of practices cannot happen. We are talking about public assets, built up by the public sector over decades, if not scores of years or generations, and to see them simply handed over to private speculators without any benefit to the public sector is absolutely unacceptable.

We have to separate out capital assets from revenue costs. Revenue costs become too great if students disappear or the college is not being run efficiently and so on. We can deal with that. Capital assets, on the other hand, should be treated as precious and retained for the public sector and for public benefit; they should not be for the benefit of property speculators who could make millions, if not billions, out of such assets across the country, if allowed to do so.

With those few words, I express my strong support for the amendment. I hope that at some point the Government will recognise this issue so that we can go further and make the principles behind the amendment even stronger in legislation, whether in this Bill or in others.

[Robert Halfon]

I thank the Opposition for the amendment and the hon. Member for Luton North for his contribution. I will make a couple of general points before I go on to the specifics.

As has been observed, and I repeat, without the Bill there is no protection for students or from the seizure of college assets. The hon. Gentleman talked about hundreds of millions in government funding, but the general point is that college insolvency is likely to be a very rare event, so the portion of government assets that might transfer to a private sector company is likely to be small. The priority, as I say, has to be protecting students. Such a transfer is right if the education administrator is fulfilling his special objective and believes that it protects the students if he has the ability to do so.

On solvent dissolution, assets must go to a charity that has educational purposes. In insolvency in a special administrative regime, transfers go to bodies prescribed in regulations, all educational, which can include private education providers, or, as the hon. Gentlemen will be pleased to know, local authorities. As the FE Minister, I always have colleagues coming to me with suggestions about how the local authority might be involved with the FE college.

The Bill is not about private providers; it is about statutory bodies and companies that run designated FE institutions—that is, designated by the Secretary of State. For independent training providers offering provision to those with advanced learner loans, there must be a register of training organisations, they must have at least satisfactory financial health, they must pass capacity and capability requirements, and they have to have evidence of, and a track record in, education and skills delivery.

To go back to the question asked by the hon. Member for Batley and Spen, transfer schemes are a feature of other special administrative regimes. They allow for assets to be transferred to another body without the agreement of a third party which would otherwise be necessary—for example, leases without the consent of the landlord. That means that the scheme can be used to prevent a third party from blocking a transfer that is intended to facilitate the achievement of the special objective. The special administration regime’s delivery of the public policy objective—in this case the protection of students—should not be subject to third-party agreement. The education administrator will use a transfer scheme only if that is necessary to achieve the special objective.

It is important to note that the Secretary of State must approve any such scheme before it is used. Even if the education administrator does not use a transfer scheme, it is open to the Secretary of State to challenge the administrator if he or she feels that the administrator is not performing his or her duty to protect students.

[Kelvin Hopkins]

A thought occurs to me. If charitable organisations were brought into play, would it not be possible for assets to remain publicly owned but be allocated to such organisations on a rental basis rather than an ownership basis?

[Robert Halfon]

We are looking at cases of insolvency. We have the protection of students at heart, but we also want to be fair to creditors. I am passionate about the Bill because I believe it assures the protection of students, but I acknowledge that we have to be fair to creditors as well, and I do not think that would be the case if we did what the hon. Gentleman suggests, although in an ideal world that would of course be a lovely thing to be able to do.

The FE body itself cannot be sold. It is a statutory body. If it is insolvent and must therefore close, the protection of students must come first; the sale of the asset would be to protect students first and creditors second.

[Gordon Marsden]

I am listening carefully to the Minister. He has just said that the FE body cannot be sold and the assets must be dealt with in the way that he has described. The problem is that this is not necessarily a question of the FE body being sold. For the sake of argument, to take the example that my hon. Friend the Member for Luton North used, there may be an asset with substantial land attached that was originally a public asset, and that could be disposed of as part and parcel of the process of trying to resolve an insolvency without that actually involving the dissolution of the FE body. I am not a lawyer, but it seems to me that there is nothing in principle to stop that happening. In those circumstances, a part-asset could be transferred that was not the whole of the FE body but perhaps represented tens of millions of pounds of value.

[Robert Halfon]

The assets currently are not publicly owned; they are owned by the FE body, which has significant operational independence, and are for the educational purposes of the FE body. Valuable land that is sold in the way that the hon. Gentleman describes has to be sold for the purpose of the special objective. I am involved at the moment in a case where an institution wants to sell for housing land that is, in my view, meant to be for FE use. He probably knows the case. We are clear that that land is for the educational purposes of the students. That is our belief.

I have covered most of the hon. Gentleman’s points. I would not be so down on private providers; there are examples of good private providers. Let us take the example of SEN students, whom we talked about earlier. It may be better for those students if the education administrator were able to transfer the students and facilities to a private body if that was the only one available. That would minimise the disruption to them, and their studies could continue uninterrupted at the same location. Sometimes, to have the private sector involved is a good thing, as long as private organisations, as I say, are properly inspected and registered and have a good record of education. I hope that I have been able to assure the hon. Gentleman that there will be no haemorrhaging of publicly funded assets to the private sector and he will agree to withdraw his amendment.

--- Later in debate ---

Conduct of education administration: statutory corporations

[Robert Halfon]

I beg to move amendment 20, in schedule 3, page 33, line 4, leave out “and”.

This amendment and amendment 21 are intended to make it clear that, where the context requires, a reference to the director of a company in the insolvency legislation applied by Schedule 3 can be read as a reference to a person who is a member of the further education body or the principal of the relevant institution rather than both. The purpose of amendments 22 and 23, which relate to references to an officer of a company, is similar.

[The Chair]

With this it will be convenient to discuss Government amendments 21 to 23.

[Robert Halfon]

The amendments are minor and technical in nature, and are intended to address a minor drafting error relating to general modifications to the provisions of the Insolvency Act 1986 related to the special administrative regime. These general modifications are set out in a table in paragraph 2 of schedule 3. Schedule 3 applies to further education bodies that are statutory corporations. Paragraph 2 makes general modifications to the provisions of the Insolvency Act 1986 relating to administration to apply them to FE bodies in special administration.

The effect of the two modifications currently leads to uncertainty about which post the relevant person should hold or have held in order for the provision to apply to that person. The minor error we identified was that, in short, we have used “and” when we should have used “or”. In more detail, as drafted, the general modifications provide that “director” is to mean “(a) member…and (b) principal”. We want the director to be “(a) member…or (b) principal”, unless the context requires otherwise.

Similarly, as drafted, the modifications in the table provide that “officer” is to mean “(a) member…(b) clerk…(c) chief executive…and (d) any senior post holder”. We want “officer” to mean “(a) member…(b) clerk…(c) chief executive… or (d) any senior post holder”, unless the context requires otherwise. These are minor and technical amendments and I hope the Committee agrees to them.

I have always wanted to read an amendment like that. [Laughter.]

Amendment 20 agreed to.

Amendments made: 21, in schedule 3, page 33, line 6, at end insert “, or

[Robert Halfon]

I beg to move amendment 24, in schedule 3, page 36, line 10, leave out “(3)” and “insert “(4)”.

This amendment corrects a cross-reference.

[The Chair]

With this it will be convenient to discuss Government amendment 25.

[Robert Halfon]

We have been clear that although the purpose of the education administration is to avoid or minimise disruption to students’ studies, the special objective is not to be pursued without regard to the interests of creditors. Clause 22, which we have previously discussed, contains a requirement for the education administrator to carry out their functions to achieve the special objective and, so far as is consistent with the special objective, to do so in a way that achieves the best result for the FE body’s creditors as a whole.

If creditors, the Secretary of State or Welsh Ministers believe that the education administrator is not acting in accordance with this requirement, the amendment made by paragraph 21 of schedule 3 to paragraph 74 of schedule 1B to the Insolvency Act 1986 allows them to apply to the court claiming that the education administrator is not carrying out their functions in accordance with requirements set out in clause 22. However, there is an error in the cross-referencing. The reference should be to sections 22(2) and 22(4), not sections 22(2) and 22(3).

Without the amendment, creditors would be unable to challenge the way in which the education administrator was carrying out their functions, which is not what we intend. I hope the Committee agrees that the amendment is necessary for the provisions to function effectively, and that it will agree to accept it.

Amendment 24 agreed to

Amendment made: 25, in schedule 3, page 36, line 34, leave out “(3)” and “insert “(4)”.—(Robert Halfon.)

This amendment corrects a cross-reference.

Schedule 3, as amended, agreed to.

Schedule 4

Conduct of education administration: companies

[Robert Halfon]

I beg to move amendment 26, in schedule 4, page 44, line 6, leave out “(4)” and “insert “(5)”.

This amendment corrects a cross-reference.

[The Chair]

With this it will be convenient to discuss Government amendment 27.

--- Later in debate ---

[Robert Halfon]

The amendments are the same in effect as amendments 24 and 25, which we have just made to schedule 3. You will be pleased to hear, Mr Bailey, that I do not propose to take the Committee through the changes again. I am sure that once was enough. It is necessary to make the amendment twice because schedule 3 relates to FE bodies, which are statutory corporations, and schedule 4 relates to those that are companies.

Amendment 26 agreed to.

Amendment made: 27, in schedule 4, page 44, line 32, leave out “(3)” and “insert “(5)”—(Robert Halfon.)

This amendment corrects a cross-reference.

Schedule 4, as amended, agreed to.

Clauses 25 to 29 ordered to stand part of the Bill.

Clause 30

Education administration rules

--- Later in debate ---

[Gordon Marsden]

I rise to speak very briefly about this clause and clause 37, both of which I want to put in the context of the broad policy statement that we have been given on part 2 of the Bill, which is pertinent to many of the questions that we and people in the sector have been asking about the capacity of the DFE and the institute to expand the remit of the Bill. That is no less true in the context of the insolvency proceedings than it is in the remainder of the Bill.

Page 4 of the policy statement says that it has not been possible to prepare draft regulations during the passage of the Bill—I feel somewhat conflicted about this, because part of me is rather glad that we did not have to consider the regulations, which may, and I quote, run to hundreds of pages in total. Instead, the Government have prepared a series of detailed notes describing every delegated power and setting out how they plan to use them. According to the Government, it was not possible to produce the full list of the regulations for us now. I say gently that they will have to be produced at some point, even if not for the delectation of members of this Committee. Does that not raise questions about the capacity of the Department? What happens when the Bill becomes an Act? Who will have the capacity to draft the regulations then? I hope the Minister does not think that is an entirely flippant comment. The assurances we have been given about capacity throughout the passage of the Bill do not appear to be piecing together.

[Robert Halfon]

I assure the hon. Gentleman that the regulations will be published; the problem is that there are many pages of insolvency legislation. That is why we were unable to publish them in time for the Committee and why we issued the policy statement. They will be published, but it takes quite a long time.

[Gordon Marsden]

I entirely understand that. I was not suggesting that people are slothing on the job; I was merely making the reasonable point that the Bill necessarily involves a lot of administrative time—I put it no stronger than that—and that raises in my mind some ongoing concerns about the capacity, either of the Department or of some of its institutions, to take some of these things forward. I will leave it at that.

[Gordon Marsden]

All I can say is that my hon. Friend is a shining example to us all. He shames us deeply.

Let me make my own brief and pathetic response to clause 30, in the context of the Stakhanovite task that my hon. Friend has just suggested we undertake. I have a practical question for the Minister. On clause 31, the policy note talks about the way in which the power will be used to make decisions. For simplicity, I say to the Minister that although I am making this point specifically about clause 30—it affects chapter 4, which is very important because it is the special administration chapter —my question is generic and may be relevant to other clauses as well. It is very straightforward. When these revised instruments and regulation-making powers are brought forward, will there be consultation in any shape or form with the various stakeholders—FE bodies, the Association of Colleges, the Collab Group and others?

That is not for the sake of consultation itself. There have been occasions in the past, although I am not suggesting in this particular Department or area, when the lack of such consultation on detailed regulations between representative bodies—it normally has to be done at that level—and officials from the Department has produced anomalies that subsequently have to be rectified. It would be interesting to hear if the Minister can offer any reassurance on that.

[Robert Halfon]

I thank the hon. Gentleman for his remarks. On Tuesday, the hon. Member for Luton North suggested that he might have been a banker, and today he talks about being an expert on delegated legislation on insolvency. I believe the latter more than the former. Knowing the kind of person he is, he is probably about the only person who could get his head round all the different delegated powers.

The clause modifies the power to make rules under sections 4 and 1 of the Insolvency Act 1986. It allows detailed rules about the education administration for FE bodies to be made in the same way as they are for companies. The power only permits rules to be made to give effect to the chapter of the Bill that establishes an SAR or FE bodies, and the rules cannot be made for any wider purpose. Clause 5 deals with the rules needed for other insolvency procedures for FE colleges. It applies the company insolvency rules and allows us to modify them as necessary.

To answer the question from the hon. Member for Blackpool South, there has been a significant amount of consultation already, and there will be full consultation all the way through. We have to; these things cannot be done without it. I want to reassure him that that will absolutely happen. On those grounds, I hope the clause is acceptable to the Committee.

Question put and agreed to.

Clause 30 accordingly ordered to stand part of the Bill.

Clauses 31 to 36 ordered to stand part of the Bill.

Clause 37

Disqualification of officers

[Gordon Marsden]

I beg to move amendment 8, in clause 37, page 18, line 14, at end insert—

‘(1A) The Secretary of State must ensure the list of disqualified officers is made publicly available.”

This amendment would ensure that a list of disqualified officers was publicly available.

The amendment is fairly straightforward, so I will not detain the Committee long. Again, we hope that these situations will be very rare, and we certainly hope it will be very rare that people are disqualified as a result of them. However, if disqualified people are involved, the principle of transparency is extremely important. This is a probing amendment, to find out how this might be effective.

Perhaps it is worth mentioning what the explanatory notes say about clause 37:

“This clause gives the Secretary of State the power, in relation to further education corporations and sixth form college corporations, to make regulations that have the same or similar effect to the Company Directors Disqualification Act 1986. This will mean that, like company directors, members (i.e. governors) of those corporations can be disqualified from acting as such in the future and the power allows the Secretary of State to make provision so that when a person is disqualified as a director of a company they can also be prohibited from acting as a member of a further education corporation or sixth form college corporation.”

I repeat that we all hope and assume that these occurrences will be irregular. However, would it not be logical for the list of disqualified officers to be made publicly available, to ensure transparency and to allow colleges to easily assess applicants to their own corporations in the future?

[Kelvin Hopkins]

I support the amendment. In my experience of life, it is often the rogues who are most plausible and we have to have lists of people to make sure that people do not get through the net, move to a different part of the country and take up a job, before we find out that they have twice been a rogue, not just once.

[Robert Halfon]

The disqualified officers to whom the amendment refers are those members of an FE body that is a statutory corporation who have been disqualified by the court on the grounds that they have been found liable by the court of wrongful or fraudulent trading or other similar offences under the Insolvency Act 1986 as applied by the Bill. Wrongful and fraudulent trading are provisions of insolvency law that will be applied to governors and others involved in running FE bodies that are statutory corporations in the same way as they apply to directors of, and those who run, companies. That is the purpose of the amendment.

It is right that a list is kept of those individuals who have been disqualified and that such a list is available to the public, so that it is evident which individuals should not be appointed as governors of colleges in the future. However, there is no need to provide for that specifically in the Bill. There is provision in the Company Directors Disqualification Act 1986 for a register of disqualification orders to be kept by the Secretary of State and for that register to be open to inspection—as we continue to refer to that Act, I propose that we use its acronym, the CDDA.

Clause 37 will allow us to replicate provisions of the CDDA; therefore it already allows us to achieve what hon. Members seek with the amendment. I have made it clear that I intend to consult on secondary legislation made under the Bill. That includes regulations made under clause 37, so it will be transparent that we will include a provision in regulations that is the same as, or similar to, the provision that exists in the CDDA, modifying it as necessary to make it work effectively for disqualified members of college corporations. On those grounds, I hope that the hon. Member for Blackpool South will feel able to withdraw the amendment.

[Gordon Marsden]

I thank the Minister for that explanation of the procedure and situation. I am satisfied and beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 37 ordered to stand part of the Bill.

Clause 38

Information for Secretary of State about further education

[Robert Halfon]

I beg to move amendment 18, in clause 38, page 18, line 38, leave out subsection (2).

This amendment removes the restriction on the Secretary of State obtaining information for purposes connected with the education of certain people aged under 25. The way that section 54 of the Further and Higher Education Act 1992 is currently framed allows that information to be obtained so the amendment preserves this aspect of the current law.

[The Chair]

With this it will be convenient to discuss Government amendment 19.

[Robert Halfon]

The purpose of the amendment is to rectify a problem that we have identified with the drafting of clause 38 that means that it does not fully meet our policy intent. Amendment 19 is consequential on amendment 18 and simply renumbers subsections.

Our aim is to ensure that the Government can maintain our current system of receiving data from further education providers after certain further education functions are devolved to some combined authority areas in England, which is due to happen from 2018. A key element of the statutory foundation for the further education data system is set out in section 54 of the Further and Higher Education Act 1992, which clause 38 amends. Section 54 imposes a duty on various bodies to provide information to the Secretary of State. Due to its specific reference to functions of the Secretary of State, that duty would cease to apply to some FE provision, as certain functions would have been transferred from the Secretary of State as part of devolution. The intention of clause 38 is to reframe the statutory basis to overcome that problem and enable comprehensive continuation of the current system of gathering information on further education.

We are not seeking to narrow or broaden the scope of education provision or types of learners covered by the duty. Clause 38(2) was drafted because we considered that the learners it describes—those aged 19 to 25 who have an education, health and care plan—were not captured by the duty under section 54. However, after further scrutiny, we have realised that for apprenticeship provision, such learners are in fact in scope of the current duty. Therefore, by including the subsection we were inadvertently narrowing the scope of the duty. That is not our intention, so we are seeking to remove subsection (2).

--- Later in debate ---

[Gordon Marsden]

I congratulate my hon. Friend on speaking to the new clause with his customary insight and from past experience, which are powerful advocates for the mechanisms he proposes. There are not many vehicles in the House for the regular praising of accountants. I am tempted to say that if we were in the middle ages and my hon. Friend, with the passing of years, were to pass away, he might be subject to a posthumous cult of the patron saint of accountants. The serious point is that everything my hon. Friend said is valid. Whether what he proposes is done in a formal way, as he suggests, or by strong direction, the Government would do well to take on board his proposals.

[Robert Halfon]

I thank the hon. Member for Luton North for the new clauses and for his wise contributions throughout the Committee. Rather than the role of banker, I think he has taken on the role of the Gandalf of the technical education and further education sector. There will therefore be no danger of his passing as the hon. Member for Blackpool South described.

The hon. Member for Luton North has tabled two important new clauses. In an ideal world it would be a good thing if all or even some members of governing bodies had important financial qualifications, but I remind him that the head of Blackpool and The Fylde College, when asked about that, said:

“I am thinking of the unintended consequences. It is very easy to say that we can dictate exactly the constitution of a governing body, but if we are looking at further education corporations across the country, some of them are very different. My own, for example, is an outstanding college.”—

I have seen it for myself, and it certainly is—

“We are very strong financially…we benefit from the mix and balance that we have on the board: we benefit from our business community and from two very able students on the board. I am hesitant about mandating exactly what that board would look like, because it varies by college. If, for example, I were a land-based college, I might want a slightly different mix, so I am hesitant about fully supporting that.”––[Official Report, Technical and Further Education Public Bill Committee, 22 November 2016; c. 60, Q80.]

When I asked her about the best way to achieve what she had done, she said what is needed is an expert to manage finances: not necessarily, dare I say it, someone with an educational background—we were talking about the education administrator earlier—but someone with a good understanding of finances. Where colleges are doing better even with all the financial pressures, I suspect that is because they have brilliant financial teams as well as the brilliant leadership of the principals and the advice of the governing body.

It is the governing body of the college that is best placed to ensure that effective management is in place that meets the needs of the college, but it must be the principal who puts her team in who has the day-to-day responsibilities. When colleges fail, as the hon. Gentleman will know, the proper intervention system is in place, with the education commissioner and suchlike.

The introduction of the insolvency regime will change a lot of this anyway, and it will serve to emphasise the importance of sound financial management. Although the Government are committed to the protection of learners, corporations are ultimately responsible for ensuring the financial health of their institutions.

I am wary of imposing such a measure, but I have a lot of genuine sympathy with the hon. Gentleman’s intentions. I commit to continue working with the sector to strengthen the financial acumen of governing bodies and the capability of financial directors. That will protect the interests of not only the colleges, learners and employers in the local communities but the taxpayer, which is incredibly important. On that basis, I hope the hon. Gentleman will withdraw the motion.

[Kelvin Hopkins]

I thank the Minister for his assurances and for his acceptance of the points I have made, if not of the new clauses. Even if nothing arrives in the Bill, I hope that guidance to colleges will, in one form or another, make sure that proper financial governance and financial management takes place so that insolvency is avoided at all possible costs.

[Robert Halfon]

I should have said that we are lucky in the sense that we have the Association of Colleges, the Collab Group and the Education and Training Foundation, and all those organisations are doing everything they can to improve financial leadership in colleges up and down the country.

[Kelvin Hopkins]

I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.

[Robert Halfon]

On a point of order, Mr Bailey. As we have reached the end of the Bill—in Committee, at least—I would like to put several things on the record. First, I thank the Opposition for the incredibly thoughtful and serious way in which they have dealt with the Bill. Where I have said that I will reflect on things, I really mean that. I particularly congratulate my opposite number, the hon. Member for Blackpool South, given that he has just come out of another huge Bill; he did this Bill almost straightaway. His capacity for knowledge is extraordinary. What the hon. Member for Batley and Spen said about careers is particularly important, and I also thank the hon. Member for Luton North for his contributions.

May I also thank you and your team, Mr Bailey, and my Government colleagues, who have been incredibly helpful and supportive? Finally, I mentioned capacity—over the past couple of weeks, the incredible officials and many others have worked day and night to get this Bill to the House and into Committee, and I am hugely grateful to them.

[Gordon Marsden]

Further to that point of order, Mr Bailey. May I associate myself with the Minister’s thanks to you and Ms Dorries? You have chaired fairly and lightly. I also thank your team—particularly the Public Bill Clerks, to whom the Opposition are always indebted, given that we do not have the Government’s resources.

May I thank my own superb team for everything that they have done? I am sorry that my on-the-ball Whip, my hon. Friend the Member for Kingston upon Hull East, is unable to be with us today, but he is at the forefront of industrial progress celebrating Siemens wind farms finally coming to fruition in his constituency, so he has a good excuse. I am grateful to all of my team, in which we have two relatively new Members—particularly my hon. Friend the Member for Batley and Spen—and I thank my hon. Friend the Member for Wythenshawe and Sale East for deputising.

I also thank the Minister and his team. He has been generous and prepared to listen and think carefully and constructively, and we welcome that. We look forward to some of the amendments we have withdrawn perhaps re-emerging in further information from him before Report stage. We are delighted to have taken part in this process and grateful for his contributions and constructivity.

Bill, as amended, to be reported.

Technical and Further Education Bill

Robert Halfon Excerpts

3rd reading: House of Commons & Legislative Grand Committee: House of Commons & Report stage: House of Commons
Monday 9th January 2017 Commons Chamber

[The Minister for Apprenticeships and Skills (Robert Halfon)]

I think this is the first time that a lapel microphone has been used in this way—I appreciate that. I wish the House, and the many apprentices who worked over Christmas and the new year, a very happy new year. I thank you, Madam Deputy Speaker, for chairing the debate. I am grateful to the hon. Member for Blackpool South (Gordon Marsden) for his amendments—as ever, very thoughtful.

I will start by discussing new clause 1, but I just want to make the point that the hon. Gentleman talked about the completion of apprenticeships. Some 70% of apprentices complete and 90% get either employment or further training. We have nearly 900,000 apprentices, an all-time high and a record in our nation’s history, so we are making good progress. He talked about NEETs. He will know that between 2014 and 2015 the proportion of 16 to 18-year-olds in education or work-based learning increased to 90%, which is the highest on record. The percentage of NEETs fell to 6.5%, the lowest rate since records began. He talked about the Institute for Apprenticeships and Technical Education appointments and went on, yet again, about Christmas. I have to say that IFATE is not just for Christmas, it is for life and we want to get it right. We want to ensure that the appointments we make are the right ones and are not made in haste. He sometimes says that we are doing things too quickly and at other times he says that we are doing things too slowly.

On new clause 1, as I explained in Committee, the institute will be required to report on its activities annually under schedule 4 to the Enterprise Act 2016, and the report must be placed before Parliament. That provision will also allow the Secretary of State to ask the institute to report on anything else she thinks appropriate, such as the information requested in the amendment. We think it would be an unnecessary and significant duplication of effort, as the information is already collected and published by the Secretary of State on the performance of the FE sector, which includes apprentices—I gave the hon. Gentleman some of the figures only a moment ago.

Much of that information goes far beyond the role of the institute. The institute’s core role from April 2017 is to oversee and quality assure the development of standards and assessment plans for use in delivering apprenticeships. Under the reforms in the Bill, college-based technical education cannot be held wholly responsible for, for example, job outcomes and wage rates of apprentices once they complete their apprenticeships. It is essential that the institute is aware of the impact it is making. We would expect it to make good use of the data on the outcomes made available to it through these public data sources and surveys, and to explain in its annual report how it has deployed them.

[Rob Marris]

I am grateful to the Minister for the work he does. He is very committed—whenever I see him he is wearing an “A” on his lapel to show his support for apprenticeships. Will he clarify one point in relation to new clause 1(2)(e), which would include in the report the satisfaction rates of employers? He will be aware that there is some concern that to reach the 3 million target there will be dilution. I am not saying there will be, but that there is concern that there might be. Is the satisfaction rate of employers currently collected —not for every employer, but through sampling—and published? If it is not, it would be very important for it to be published, so that the concerns about a dilution of standards could be somewhat allayed.

[Robert Halfon]

I thank the hon. Gentleman for his kind comments. It is published. I think, if I am not mistaken, employer satisfaction is near 90%; it might be 88% or 85% or something like that. I am very happy to provide him with the information if he so requires.

I agree with the hon. Member for Blackpool South that the institute needs to consider the views of those who take an apprenticeship or a course in technical education. I am confident that it will do that. He will know—he pointed it out—that last week we published draft strategic guidance for the institute. In this document, which is now open for consultation, we set out that we expect the institute to establish an apprentice panel that will report directly to the board. I am pleased to say to the hon. Gentleman that it will be ready by April 2017, but the wider point is that we should not rush things. We need to get it right. The apprentice panel will be made up of apprentices from different occupations and experience. The panel will decide for itself which issues to focus on, and will challenge and make recommendations to the board. I am sure it will be a success. It will ensure that the views of apprentices are fed directly into the institute’s governance. It might not be exactly the right model in practice. I want to see how it works. I believe that the institute, particularly in its infancy, should have the flexibility and the freedom to decide the best way of gathering the views of an apprenticeship on an ongoing basis. Whatever model it adopts, I would expect the institute to do something similar for technical education students when it takes on this responsibility, but I want to see how the apprentice panel pans out.

[Gordon Marsden]

I thank the Minister for giving way with his customary courtesy. I just want to be absolutely clear about the implications of the wording of the document. Is he giving an assurance on the Floor of the House that the panel will be set up by April, that he will review the panel’s progress and whether it has the right form and structure, and that if he thinks it does not have the right form or structure he will replace it with something equally valuable in representing the views of apprenticeships to the board of the institute?

[Robert Halfon]

I am pleased to give the hon. Gentleman that guarantee. The panel will be set up by April. I believe it would be pointless to have an Institute for Apprenticeships and Technical Education without proper apprentice representation, but I want to see what the best format is. I am sure it will work and be a success, but I just want, as I said, to see how it pans out. We expect the institute then to do something similar for technical education students.

I agree with the motivation behind the amendment, but I am concerned about enshrining the establishment of panels in legislation. I do not want to put the institute in a constant straitjacket of legislative red tape that reflects every good idea there may be on how best to fulfil its responsibilities. I therefore think the amendment is unnecessary and would undermine the institute’s power to regulate its own governance and perform its duty.

On new clause 4, the hon. Member for Batley and Spen (Tracy Brabin) made a remarkable speech in Committee on a careers strategy. She cares passionately about this, as I do, but I think we do have meat on the bones. It is not just words. The hon. Member for Blackpool South talked about budgets. We are spending £90 million, which includes the work of the Careers & Enterprise Company. A separate £77 million is being spent on National Careers Service guidance just this year. I am going further. I am looking at a careers strategy from the beginning to ensure that we address our skills needs, and to look at how we can help the most disadvantaged. I am looking at how we can ensure widespread and quality provision, and how that leads to jobs and security. I will set out my plans on careers over the coming weeks.

On the investment in the Careers & Enterprise Company, the hon. Gentleman seemed to suggest that there was no activity in London. I have been to a school in east London supported by the Careers & Enterprise Company and the local enterprise partnership. It is doing remarkable work. Some 1,300 advisers are connecting schools and colleges. They are slowly creating a way to connect with 250,000 students in 75% of the cold spots around the country. There is also money for mentoring. He talked about a famine. I would not say there is a feast, but substantive and serious funds are going in. I could spend a lot of time listing the different moneys, but if he looks at this carefully and fairly, he will see the work that the Careers & Enterprise Company is doing.

We will monitor carefully the impact of our work. In January 2017, destination data will be included in national performance tables for the first time, ensuring an even sharper focus on the success of schools and colleges in supporting their students. Before my time, we legislated to ensure that schools gave independent careers advice on skills and apprenticeships—that was done by my predecessor. Work is being done in schools. I welcome the hon. Gentleman’s thoughtfulness in proposing the new clause, but it is my view that it is not necessary because of the action we are taking, the careers plans I am developing and the money that is being spent, which I have highlighted.

As the hon. Gentleman said, amendment 4 would require the institute to have regard to the need to promote equality of opportunity. I welcome the opportunity to debate that. I know why he tabled the amendment and why it is important. It is crucial to widen access and participation, and to ensure that apprenticeships and technical education are accessible to all, which is why I was glad that, for this year, we have our £60 million fund to help to encourage apprenticeships in the most deprived areas of our country.

I reassure the House that the Institute for Apprenticeships and Technical Education will have to have due regard to widening access and participation. We carried out an equalities impact assessment before publishing the post-16 skills plan, which concluded that the reforms are likely to have a positive impact on individuals with protected characteristics, in particular those with special educational needs or disability, those with prior attainment and those who are economically disadvantaged. The economic assessment concluded that all learners would benefit from the proposed technical education reforms, which will give people access to high-quality technical education courses.

I believe that the need to promote equality of opportunity in connection with access to and participation in further and technical education already exists in legislation under sections 149 and 150 of the Equality Act 2010. It is expressly set out in section ZA2 of the Apprenticeships, Skills, Children and Learning Act 2009 that the institute must have regard to

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

its “remit”. The Secretary of State has the power to provide the institute with further guidance under that section. I hope that that explanation gives the hon. Gentleman confidence. I am committed to ensuring that people of all backgrounds have equal opportunities. As he will know, over Christmas we removed the need for apprentices who have serious hearing difficulties to do functional English—they can do sign language instead. That is an example my commitment, as is the extra funding we are giving to employers and providers to get more apprentices who are disabled.

[Mims Davies (Eastleigh) (Con)]

Will the Minister confirm that bringing together oversight of apprenticeships and technical education in one place will bring coherence into the system, which will ensure and protect diversity and equal opportunity because there will be clearer guidance on all opportunities for career progression?

[Robert Halfon]

My hon. Friend, who campaigns a lot on diversity and equality, is absolutely right. The proposal will benefit the people who need it most. Many people from disadvantaged backgrounds and with disabilities are prominent in further and technical education.

Amendment 5 addresses the Apprenticeship Delivery Board. The hon. Member for Blackpool South was a little unkind about the board. The board’s representatives include the chief executive of Channel 4, the Compass Group, the City of London, Barclays bank, Sunmart Ltd, Fujitsu, Wates construction, the Ministry of Defence and a significant retail sector member. As he said, there are three women on the board. They are doing important work. They advise the Government and work with businesses to encourage them to have apprentices. As far as I am aware, those people are not being paid. They do not have to do it; they do it because they want to serve our country. They have helped the Apprentice Ambassador Network. The chair, David Meller, is doing important work on that and running the board. I pay tribute to the board. I mean this kindly, but I would not be obsessed with whether or not the Prime Minister has an apprenticeship adviser. As far as I am concerned, the Prime Minister’s advisers are the Minister for Apprenticeships and Skills, which is me, and my boss the Secretary of State. A new adviser for the Prime Minister will not change the course of history for apprentices in our country.

[Rob Marris]

Most of us would see the Minister as a journeyman or time-served Minister rather than as the Minister for Apprenticeships and Skills. He will forgive me for not researching this earlier, but I did not notice in the list he read out any trade union representation. Unusually for Conservative Members, he is an active trade unionist—or he was. Does he agree that it would be desirable to have trade union representation on that board to get buy-in from the workforce side?

[Robert Halfon]

The hon. Gentleman will be pleased to know that I am still a trade unionist. That is a good idea. The board is independent, but I will suggest it. I am very impressed and supportive of the work that Unionlearn does, which is why we have agreed to fund it by £12 million. It works to promote training and apprenticeships.

The institute will consult the Apprenticeship Delivery Board and other bodies but, as I have said, we do not need to straitjacket the institute with so much red tape that we stop it from being independent. The delivery board is not intended to have any special legislative standing or corporate identity. It would be unusual to name it in legislation, but the institute will consult the board along with others.

Amendment 6 would require the institute’s expenditure in any one year to exceed that raised by the levy. It is important to clarify that the institute will not have responsibility for the apprenticeship budget, which resides with the Secretary of State for Education. Although the institute is not a funding body, it will be asked to advise on the pricing of apprenticeship standards and allocation to funding bands. The institute’s operations will be funded by my Department and not from the levy funds. It follows that the institute should not be obliged to spend funds raised under the levy.

On devolution, which the hon. Member for Blackpool South mentioned, it will be up to the devolved authorities how they spend the money. If we were to tie the spending explicitly to the levy receipts, there could be adverse funding consequences for the programme as a whole. The budget for spending on apprenticeships in 2019-20 for England and the devolved Administrations totals in excess of £2.9 billion, whereas the projected levy income is £2.8 billion. Having certainty over the funding for apprenticeship training is preferable to linking the funding on a year-by-year basis directly to the wider performance of the economy.

[Mims Davies]

Eastleigh College, which is the third-largest college providing apprenticeships in England and trains over 9,000 apprentices, is particularly interested in how the funding formula for the institute will work and how that will support its work with communities, so the Minister’s clarity today around the levy, the funding criteria and how it will be delivered is very welcome.

[Robert Halfon]

I thank my hon. Friend. It is brilliant that her college is providing such training, and I would be pleased to come and see its training programme when I am next in the area. That it is doing this means that it will also be receiving significant funds. I congratulate the college on the work it is doing on apprenticeships.

Amendment 7 would limit the power to confer new functions on the institute to “state funded” apprenticeships and technical education. All the institute’s current functions in part 4 of, and schedule 4 to, the Enterprise Act 2016 and in schedule 1 to the Bill apply to all reformed apprenticeships and technical education qualifications, not just those that are state funded. We would therefore expect that any new functions the institute is required to carry out should also apply in the same way, to ensure that they are fully effective and do not treat some apprenticeships and technical education courses differently in accordance with how they are paid for. We want to ensure that as many people as possible can undertake an apprenticeship or technical education course, and we would not want this to be restricted to those that are state funded purely because the institute’s functions have been limited.

On amendment 8, it is important that the institute considers what apprenticeships might be appropriate for 16 to 24-year-olds. We know that apprenticeships are incredibly important to school leavers and are making sure that anyone from the age of 16 will have an offering of either an academic or technical education or an apprenticeship. The occupational maps that the institute will put together and which will guide apprenticeships and technical education qualifications will be based on information about the skills needs of the country. They will focus on occupations that can help to increase the UK’s productivity and meet the needs of employers. Putting any constraint around the development of the maps and the occupations included, such as by focusing on a particular group of the population, could damage this overall aim.

My Department runs a number of highly successfully promotional and advice services to help to ensure that young people access the right apprenticeship for them. A significant number of 16 to 18-year-olds take up STEM subjects.

[Vernon Coaker (Gedling) (Lab)]

On STEM subjects and the advice given to young people, successive Governments have tried to effect change, and the Bill, which is well meaning, will make a positive difference in many respects, but is not the real problem the fact that successive Governments have failed to persuade people that the vocational route is as good as the academic route? Is this not a cultural problem that has bedevilled our country for decades?

[Robert Halfon]

The hon. Gentleman is completely right. When I talk about my priorities for skills and education, one of the first things I mention is transforming the prestige and the culture. As he says, this is regardless of what party is in government, and it is not just about Governments either; businesses have also underinvested. Vocational training has always been seen as a so-called—I hate the term—Cinderella sector. The whole purpose of the Sainsbury reforms and the levy is to change behaviours and give apprenticeships and skills and technical education the prestige they deserve.

[Vernon Coaker]

The question for the Minister, as it was for me and others here when we were schools Ministers, be we Conservative, Liberal Democrat or Labour, is this: why will it be different this time? The Minister is absolutely right in what he has said, but why will it be different this time from all the times that have gone before?

[Robert Halfon]

Unlike the hon. Gentleman, I was not around for all the other times that have gone before. We have our differences, of course, but there is much cross-party consensus on the Sainsbury reforms, for example. Moreover, the apprenticeship levy is a fundamental reform to change behaviours—it is not just about raising money; it also changes behaviours. I believe that there is a new national conversation about apprenticeships and that things are changing, but the proof of the pudding will be in the eating. I think we are on the tip of something special, but a lot more work needs to be done.

Because of time, I will speak only briefly on some of the other amendments. On amendment 9, the hon. Member for Blackpool South raised some important points, but we feel that the amendment is unnecessary. The important feature of approved English apprenticeship standards is the move away from a reliance on a series of small and pre-existing qualifications making up an apprenticeship and towards a single end-point assessment. By not mandating qualifications in standards unless they meet one of these criteria, we are ensuring that individual employers have the freedom and flexibility to determine how to train their own apprentices to ensure they gain full competency. It is expected that the institute will continue with this approach.

The provisions on education copyright are very complicated, and I understand why the hon. Gentleman has raised them, but we do not think that the proposed provisions are necessary. Some of the concerns are covered by existing legislation, but we believe that the institute should have the right of copyright, and the bodies working with the institute will know that. We do not agree with the word “route” either because it could be confusing for employers. I want this form of training to be prestigious, and so I want the words “technical education”. I do not like the term “tech levels” either because it dumbs down a very important qualification.

Amendment 17 is on the power to charge for technical education certificates, and I should say that we also have a duty of care to the taxpayer. The institute will not make money out of this provision. It is all about giving it the power to do so if it so chooses and about having a duty of care to the taxpayer. It is for that important reason that we do not support the amendment.

On the Quality Assurance Agency for Higher Education and amendments 18 to 21, the organisations named in the provisions will all have an important role. The omission of the QAA reflects in part the changes being introduced in the Higher Education and Research Bill, which is currently in the other place. Amendment 20, which specifies that the term “apprenticeships” should include those offered by higher education institutions, is not required. I am clear that the term “apprenticeships” includes all apprenticeships offered at all levels, regardless of the training provider.

In conclusion, I thank the hon. Member for Blackpool South for his thoughtful new clauses and amendments on technical education and I thank other hon. Members for their contributions. I hope that my responses have reassured the hon. Gentleman and the House on their underlying concerns. I therefore ask that he withdraw new clause 1 and not press his other amendments.

[Rob Marris]

If you will allow me a little latitude, Madam Deputy Speaker, I would like to place my remarks on the amendments in context. I was recently speaking to someone who made a very good point about who is fitting all the kitchens and bathrooms in Poland. This person had experienced very good electricians from Romania working in this country. Our conversation was about Brexit and the skills shortage in the United Kingdom. Whichever side of the debate hon. Members supported, Brexit provides our country with an opportunity to try to address the skills shortages that we have had for decades and have relied for filling on importing workers.

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[Rob Marris]

I am not surprised about that. In the last Parliament but one, I had the joy of visiting Lithuania with what was then the Trade and Industry Committee, and that was the sort of issue we talked about. In those days, Lithuania was already starting to import labour from Moldova—outside the European Union—because so many Lithuanians had come with their skills particularly to the United Kingdom and Ireland to ply their respective trades, and I specifically mean trades.

What my hon. Friend the Member for Blackpool South (Gordon Marsden) has sought to do from the Labour Front Bench is to beef up the Bill in two ways. One is to introduce even greater confidence in the new system that we will have, and part of that confidence building means moving towards national standards. This partly addresses the issue raised by my hon. Friend the Member for Gedling (Vernon Coaker) about parity of esteem. We talked earlier this afternoon about parity between mental and physical health, but in this case, we are talking about parity of esteem between the vocational and the academic.

Having been a semi-skilled worker for a number of years as a professional driver and a bus driver, I faced a fork in the road. Was I going to go down the vocational route—I had my eye on being a plumber—or was I going to go down the academic route with an eye to being a lawyer? I went down the academic route and I became a lawyer. I do not regret that at all. One reason I did so related to esteem or lack thereof, and another reason was that lawyers get to work indoors whereas plumbers sometimes have to work on building sites outdoors—and I do not like the cold. I am talking about quite a while ago, and the money was better in law than it was in plumbing. I am not sure whether that remains the case nowadays.

We live in a capitalist society. Part of what needs to be done to move towards parity of esteem in a cultural sense is the sort of thing that the Minister has attempted to do during his tenure of office and through this Bill; and, frankly, in a capitalist society, part of it is about paying people more. If we want parity of esteem, we should start paying people equal amounts of money—and pay plumbers as much as lawyers. Given that we live under capitalism, we are moving towards that because of skills shortages.

On new clause 1, I quite understand the Minister’s point that some of the information is already published as a result of the Enterprise Act 2016, but I believe that building this into the Bill as my hon. Friend the Member for Blackpool South has proposed, would be helpful for sending out the right message about confidence. It is the same with new clause 2, so that the representative panels can become more representative when they are put in place. I welcome the Minister’s assurance this afternoon that those panels will be in place by April, and I hope they will have a breadth of representation that should, I think, be built into the Bill. I asked the Minister a similar question in a slightly different context about the involvement of trade unions. This is not just a tit-for-tat along the lines of “You have the bosses there, so we have to have the workers there,” although that is important; it more about getting buy-in to the new regime from all sections of our society to build towards addressing the skills shortages that we will face, as I have said, under Brexit.

Under Brexit, there is no mistake about it: the price for staying in the single market would be free movement of labour and people; and the UK population has said that it is not up for that and does not want free movement of people or labour. We will therefore not be in the single market, but we will not have free movement either, because there will be restrictions—whether Members like it or not. We should use these circumstances in a positive way, so that local people can train up for jobs and so that we do not keep poaching skilled people from abroad—whether from Lithuania, as my hon. Friend the Member for Luton North (Kelvin Hopkins) mentioned, or elsewhere. For that, we need national standards.

When it comes to confidence, we need proper advice. Careers advice in England has certainly been, to say the least, patchy over the years. I remember when my Government set up Connexions, which was not exactly a resounding success—certainly not in the west midlands. I urge the Minister to think again about new clause 4, which is all to do with building confidence. That is particularly clear in paragraphs (b) and (d) of new clause 4(3). These highlight the fact that the Secretary of State should seek to

“ensure that such information, advice and guidance may be taken into account by relevant authorities and partners to meet the needs of local or combined authority areas”

and to

“monitor the outcomes of such information, advice and guidance for recipients.”

It is part of confidence building that we have a regime that is sensitive to local labour markets, which will change greatly from April 2019 when we are out of the European Union.

This Bill is part of the Government—surprisingly, given what is not happening in other areas—showing a bit of foresight, on which I congratulate the Minister. If only we had such foresight about Brexit ramifications for other areas of public endeavour; we do not, but this Bill is a step forward and part of that jigsaw. I am not saying that this is why the Minister has sought to introduce the Bill, but I do think we should look on it positively in that way, and I think that new clause 4 would help to build confidence in the new system, by ensuring that it would be reflective and flexible.

In referring to amendment 9 and others that my hon. Friend the Member for Blackpool South said were in a sense under its umbrella—amendments 10 to 16—the Minister talked about employers having freedom and flexibility. Amendment 9 deals with “recognised technical qualifications” and these are connected, certainly for England as I said, with national standards. We need those standards as part of the confidence-building measures, but also to make sure that we get the right people with the right skills—in a sense, workforce planning.

This country is pretty poor at workforce planning. The one area where we could have excellent workforce planning because the number of employees is so enormous and they almost all work for the state is in healthcare delivery, yet it is absolutely appalling. We do not have enough doctors trained here; we do not have enough dentists trained here; we certainly do not have enough nurses trained here; we do not have enough professions allied to medicine—whether radiographers or phlebotomists and so forth—trained here. Yet this is the one area of workforce planning that the Government could get right. I do not mean that only this Government have singularly failed. Under the coalition Government, things went backwards when some nurse training places were shut down. Figures on the number of employees working in the NHS in England alone are so huge that we could take social trends into account and do some pretty good workforce planning on the kind of skills that will be needed in five years or the 10 years that it takes to train a doctor, and so forth.

Arguably, we have been absolute rubbish at this since 1948. Having national standards is important not just for confidence, but for workforce planning. That is why I again urge the Minister to have another think about the import of amendment 9, if not its wording. It is all very well having flexibility and freedom for employers. These were the sort of words that the Minister used—he will correct me if I am wrong—when he explained why he thought amendment 9 was unnecessary and invited my hon. Friend the Member for Blackpool South to withdraw it. In my view, however, the Minister should have another think about that, because I believe that national standards are important. Again, I draw on my own experience. When I qualified as a lawyer, I took a national exam that had to be taken by all those seeking to become solicitors in England and Wales. For most of us, if we passed, that led to what was, in a sense, the equivalent of an apprenticeship. It was called “articles of clerkship”, and it involved two years in a solicitor’s office. What had been a national exam taken by everyone who wished to be a solicitor in England and Wales then became a moderated Law Society final exam. My hon. Friend the Member for Cardiff Central (Jo Stevens) will remind me what it was called. [Hon. Members: “Legal practice course.”] Yes. It became a legal practice course, and standards went down. I say that having talked to people in post-secondary institutions at the time and having trained articled clerks who had experienced the later system when national standards no longer existed.

National standards are not, of course, a guarantee of quality output, but they can be used by any Government, legitimately and properly, to ensure that we have confidence in the system and to ensure that those who undergo an apprenticeship process and emerge from it fully qualified have a qualification that is worth their having as individuals, and worth our society having.

[Robert Halfon]

Qualifications may be mandatory in an apprenticeship standard if that is a mandatory requirement set by the regulator. They include qualifications that are recognised as a legal requirement—that is, licence to practise—that are required for professional registration, or that are used in a hard sift when apprentices are applying for jobs in the occupation related to the standard and would be disadvantaged in the job market without them.

[Rob Marris]

I thank the Minister for that clarification. In a sense, he has made my point for me. There will be some national standards in certain fields of endeavour, which he has helpfully specified. However, I think that there is a contradiction in his position, a contradiction from which I do not think I suffer.

Amendment 7, tabled by my hon. Friend the Member for Blackpool South, would insert the words “state-funded”. I found the Minister’s argument persuasive when he explained why he thought that the amendment should not be passed. I may have misunderstood what he said, but he seemed to be saying that he wanted a more overarching model that would encompass privately obtained qualifications. I agree with him. I merely suggest that, if amendment 7 is not accepted, it would be logical to accept something along the lines of amendment 9, which would not limit the requirement to state funding but would provide for national standards, not just in the broad but restricted field defined by what the Minister helpfully read out a moment ago, but more widely. I think that that would be better for confidence, better for our economy and better for the people—many of whom will be young—who will acquire those qualifications. I therefore ask the Minister to think again.

A similar issue is raised by amendments 18 to 21, which relate to the involvement of the Quality Assurance Agency for Higher Education. They, too, seem to me to relate to the ability of employers and prospective apprentices—and, in the case of young apprentices, their families—to feel confident that the system will deliver a qualification that our country needs and that involves enough training to ensure that those apprentices are likely not only to end up with jobs but to contribute to society as we would like them to. That returns me to the workforce planning issue to which I adverted earlier.

The Minister and the Government ought to think again about those amendments. They may not want to accept the exact wording, but I should like them to include the Quality Assurance Agency for Higher Education in the list of agencies that will have a role to play in the planning, the maintenance and perhaps even the raising of standards. That would be desirable.

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[Kelvin Hopkins]

It is a great pleasure to speak in this important debate. I, too, was a member of the Bill Committee, and I am somewhat disappointed that Government amendments have not been introduced at this stage reflecting some of the points made in Committee, especially as they seemed to be accepted at the time, in broad terms, by the Minister. I therefore hope that amendments will even now be brought forward in another place to reflect some of the discussions we had in Committee, and, indeed, some of the points made this evening, particularly by my hon. Friend the Member for Blackpool South (Gordon Marsden) on the Front Bench, who made a tour de force speech introducing all his amendments. It is surprising that there are no Government amendments or new clauses on Report; that is very unusual.

All the amendments and new clauses have been introduced by my hon. Friend on behalf of the Labour Opposition—and they are all splendid and I support them all. The lack of Government amendments is disappointing, even though there is a degree of agreement on the value of this legislation, and we all know we have to do something about improving apprenticeships and training our young people for the future. As my hon. Friend the Member for Wolverhampton South West (Rob Marris) said, we have to train our own rather than just poach people from abroad.

New clause 1, requiring the Institute for Apprenticeships and Technical Education to report annually, is specifically about the outcomes of completed apprenticeships; it is about the quality of apprenticeships, not just other, broader measures of success. The quality of apprenticeships is vital, to ensure that they lead to the development of skills for quality, long-term jobs after their completion. Young people who complete their apprenticeships must be desirable to their own and to other employers; they must be able to command good jobs for the long term and to look forward to relatively high pay and advancement in those jobs. It is very important to make sure that apprenticeships are high quality not just in words, and that apprentices can do the things they are required to do after they have qualified.

I remember the days, many decades ago now, when we had full employment. I taught in further education during that era, and in many ways it was a better and happier period than we are in now. Everybody who wanted a job got a job, and teaching in further education was a sheer joy. It has been more painful and stressful since then, I have to say, and less well paid, and the conditions of employment are less good than when I was teaching. But that was several decades ago, back in the early 1970s. We also had large companies, mainly in the manufacturing sector, and the giant public utilities, which were then in public ownership, employing thousands of apprentices every year. They had to train their own and they wanted to make sure they were good. Some of those they trained moved off to other jobs, of course, but it was nevertheless beneficial to those doing the apprenticeships and to wider society.

Our society did well because we were training our own, but we have failed to do that in recent times; we have left things to the market, and the market does not always work well in these matters. A degree of Government intervention is required, and it is significant that the Prime Minister has used a phrase not used by any Government for a long time: she has talked about the need for an industrial strategy. I absolutely support that, and we had a debate on industrial strategy just a few weeks ago, which the hon. Member for Warwick and Leamington (Chris White) led very well.

The subject we are discussing now is part of that industrial strategy. We have to train these people, to make sure we rebuild industry. We do not produce enough any longer, particularly in the manufacturing sector; we do well in services, but not in manufacturing. We have a gigantic trade deficit because we cannot produce enough and we have to buy in from abroad. We must rebuild the manufacturing sector, not so that it becomes the dominant force necessarily, but at least so that it produces sufficient to have a sensible trade balance, which we do not have at present.

Apprenticeships have always been insecure in recent times because companies are much smaller now than they were and they are less secure because of economic crises. I have many anecdotes from my own experience. Just after the 2008 crisis, I was being driven to Heathrow for a parliamentary visit and the driver had an apprenticeship in the construction sector, but the company he had been with had collapsed and he finished up being a cab driver, which he could have done without doing an apprenticeship.

I have heard of fears, too, such as small companies training apprentices who are then poached by larger, more financially lucrative companies. That is particularly the case in the motor trade, where there are skilled small companies training their own people who are then poached by large companies that do lucrative insurance repair work, which can pay a lot more.

[Robert Halfon]

I thank the hon. Gentleman for, yet again, making a thoughtful speech. I do not have the figures to hand, but the evidence suggests that apprentices in companies are more loyal to that company than those on any other training scheme or in work experience or doing early-career jobs, and that they tend to stay with the companies they do their apprenticeships in.

[Kelvin Hopkins]

I am sure the Minister is right in the majority of cases, but for some there is pressure to move on—for instance as a result of what is happening with house prices at the moment, as one can imagine. Certainly in Luton I know of companies, such as small motor repair firms, that employ apprentices who are under pressure to get a home, and if they can earn a few thousand pounds more at a larger company nearby to help them get on the housing ladder, they will do that. I agree that loyalty is important and many of them want to be loyal, but if the financial pressures on their lives are such that they have to move, they will in the end move.

I particularly want to support the point made by my hon. Friend the Member for Blackpool South about the need for a strategy for improving career education and new clause 4. We must ensure that when young people are at school or in further education they are aware of the enormous range of opportunities out there and they do not just look at a narrow field. In Luton too high a proportion of students want to get into the legal profession, for example; they want to be professionals and do not appreciate that there are highly paid, highly skilled jobs in manufacturing industry.

Vauxhall Motors still has a plant in Luton, and almost all its senior executives started as apprentices, leaving school, doing apprenticeships and going up the ladder, eventually doing higher qualifications such as higher national certificates and higher national diplomas and becoming highly paid senior executives in the company. Those opportunities are out there, and young people must be made aware of them. We must have a careers strategy making sure that every young person knows about all the thousands of different roles they could assume in life, rather than just going into the professions, or, indeed, just going into a local company; there are lots of things young people can do.

Life can be very exciting, and it is important that all of us do something we enjoy. I am very fortunate in that I was fascinated by politics in my early life and I finished up in Parliament where I wanted to be; I do not regret a moment of it. But sometimes people are not aware of the enormous range of possibilities in life. Having a powerful careers advice strategy is vital not just for young people’s lives, but for the economy. If people are happy in their work, they will work better and the economy will work better, and the world will be a much better place.

I have one more story that explains something tragic that has happened in Luton. We were a town that trained thousands of apprentices, and I know many of them personally. Recently I visited a small manufacturing company that makes components for Formula 1 and Jaguar. It could not find one toolmaker; it wanted one toolmaker from a town of over 200,000 people that used to be dominated by manufacturing, but could not find one. It is a disgrace that we have failed to train sufficient numbers of people in these areas.

There are many other things I would like to say—I could speak for an hour unaided, I am sure—but as others want to contribute, I will leave it there. I hope the points I have made are of interest.

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[Gordon Marsden]

My hon. Friend has a double qualification to speak on the subject: as the Member of Parliament for the constituency she represents and through her previous career as a distinguished local government leader in London. She knows whereof she speaks and she is absolutely right that the problem is accentuated in those areas.

Money has come in over the years including pre-1992 and in the major Building Colleges for the Future programme that the Labour Government introduced in the 2000s. Then, of course, significant sums of money were put in by regional development agencies and sometimes through regional growth fund developments and offshoots of European structural funding. As I said, FE colleges deliver not just FE, but higher education. If 10% to 12% of total HE provision is being delivered by FE colleges, it is really important that we do not lose that position.

I do not want to rehearse—indeed, we do not have time to tonight—the arguments that were made in 2011 about the private for-profit sector training coming in and being involved with various equity funds whose investment platforms were very much focused on a broad area. However, I would say, as many in the sector would, that although the private equity funding sector can be extremely profitable and useful, it is based on a relatively short-term view of providing management and initial capital to buy other companies and then taking them off the public share markets. It is entirely reasonable for us to be concerned about the possible disposal of lands with significant amounts of public assets. The question is not simply whether it is a good thing to transfer a significant number of public sector assets to a private provider, but what the financial guarantees are. More importantly, there are issues regarding the nature of the body and the guarantees to the students and the people employed there if such organisations use the insolvency to take on those colleges.

Ministers may talk about guarantees for staff under TUPE, but I am sure that hon. Members realise that TUPE does not offer protection forever and a day. I have had significant experience of that in my constituency in Blackpool over the years with people who have been outsourced from the civil service and TUPE-ed into other organisations that have then passed on to someone else, at which point those people’s automatic rights and security of tenure have almost become extinguished. Those are our concerns and they are not irrelevant. They are concerns of pragmatics and of principle. It is not as though there have not been concerns in the area previously.

In December 2014, the Public Accounts Committee severely quizzed officials from the Department for Business, Innovation and Skills, which then had responsibility for the matter, about why private providers were allowed to engage in untrammelled expansion without proper quality checks. In February 2015, the Committee published a report that said that BIS has repeatedly ignored advice from the Higher Education Funding Council for England about vast sums of public money going to for-profit colleges without due process and consideration. There is the potential, as Martin Doel, the former chief executive of the Association of Colleges, said, for private organisations to

“asset strip colleges’ buildings and facilities”

or “pick” assets.

So, for the avoidance of doubt, we are not saying that we would oppose any private sector takeover of a college in any circumstances; we are saying that the education administrator will have to make a judgment. We are also saying that, without the protection in this amendment, the potential for the things I have described to happen would be very high, and that is why we are determined to press the amendment this evening.

[Robert Halfon]

I thank the hon. Member for Blackpool South (Gordon Marsden) again for his amendments. I will begin by discussing amendment 1, which affects clause 14. I have to stress that, in the unlikely event that an FE body becomes insolvent, we want to ensure that any disruption to students’ studies is avoided or minimised as far as possible. It will be for the education administrator to deal with that, and according to the relevant clause in the Bill, they will be an insolvency practitioner—they are likely to come from one of the bigger companies and to have education experience. It will be the same system as with insolvent companies.

The education administrator will decide how the special objective will best be achieved. Clause 14(2) does no more than suggest ways in which that might be done. The education administrator will need to consider the specific circumstances of any insolvency and then determine the most appropriate approach. It is inconceivable that they would draw up proposals for achieving the special objective without having had discussions with a wide range of stakeholders, such as the Further Education Commissioner, student bodies and others, and without considering a wide range of pertinent issues.

Our expectation is that that will include discussions with the key stakeholders, local authorities and others. Where appropriate, it may also involve—I brought this up in Committee—a conversation with the care leaver’s personal adviser. We discussed in Committee the additional personal and pastoral support that care leavers might need. I undertook to consider the matter further, and I hope the hon. Member for Luton North (Kelvin Hopkins) will be pleased that we are keeping the promise we made in Committee. We will ensure that the guidance to local authorities on their corporate parenting responsibilities, being introduced through the Children and Social Work Bill, includes advice on the role of personal advisers in the event of a college insolvency affecting a young person for whom they are responsible.

We expect the education administrator, in developing their proposals, to take account of the quality of alternative provision and, if it is necessary for students to complete their studies in other locations, to consider the impact of travel distances. The hon. Member for Blackpool South will be aware that we provide funding to colleges to support disadvantaged and vulnerable young people. In addition to the disadvantage funding for post-16 places—£550 million in 2016-17—which can be used to subsidise college buses, there is also the 16-to-19 bursary fund and the fund for the particularly vulnerable. Colleges will be able to offer this funding to eligible students who transfer to them under a special administrative regime. There may be scope for the education administrator to set up a scheme to cover some or all of the additional travel costs if students do have to travel to another location.

In Committee, the hon. Gentleman said:

“We do not want this to become”

a

“long-winded, time-consuming process”—[Official Report, Technical and Further Education Public Bill Committee, 1 December 2016; c. 174.]

I share that view. It is in the interests of students and staff to have certainty as soon as possible about what will happen. Requiring formal assessments to be carried out in the way proposed by the amendment would lengthen the process and reduce the education administrator’s discretion to find the best way of achieving the special objective. That is not to say that we do not agree that these issues are important, but I have shown that they are at the front of the education administrator’s mind.

On amendment 2, I understand the issue about double protection and why the hon. Gentleman has tabled the amendment. The amendment is unnecessary because the court, on hearing an education administration application, already has the discretion to make any interim order it thinks appropriate. If it is necessary or appropriate to make an order relating to an existing student protection plan, the court has the power to do that under the Bill.

On pensions, we have followed as far as possible the provisions of the ordinary administration regime that exists for company insolvencies. We propose to adopt similar provisions for college insolvencies, which, as I say, will be very rare indeed. As with any administration, once the administrator has adopted the employment contracts of the staff they decide to keep on, they are personally liable for the costs of those individuals, such as their salary and their pension contributions. They would take on the appointment only if they were confident that sufficient funds were available to meet the costs. Some pension contributions will continue to be made and benefits accrue. Some staff may be made redundant, whether at the start of the education administration or subsequently, but this will of course be in accordance with statutory employment rights. For these staff, contributions to the pension fund will end once they are no longer employed by the body, but this is no different from the position of any other person leaving their employer’s pension scheme. It is important to be clear, however, that the benefits individuals have accrued in the scheme prior to the end of their employment will not be lost.

I accept that the hon. Gentleman feels very strongly about the transfer issue. FE colleges are statutory corporations with very significant freedoms to deal with their own assets. A solvent college is free to transfer property to any person or organisation it chooses. In order to benefit, the college would of course expect to receive value when transferring an asset to a third party, and in general this would mean transferring at market value, although this depends on the nature of the transaction as a whole. In this case, however, we are talking only about a situation where a college has failed financially and is insolvent—an extreme case.

I need to make it clear to the hon. Gentleman that there are four vital protections that act as a quadruple lock to safeguard assets that belong to the college, which may well have been paid for with money from the public purse but have to be dealt with because the college is insolvent. First, unlike solvent, operational colleges that wish to transfer property, if the education administrator decides to make a transfer scheme, they are restricted as to whom they can transfer the assets. These bodies are prescribed in the secondary legislation made under section 27B of the Further and Higher Education Act 1992. They are public sector bodies with educational functions. In addition, transfers can be made to private companies, but the company must be established for purposes that include the provision of educational facilities.

Secondly, just as with any other action of the education administrator, any transfer scheme must be for the purposes of achieving the special objective of avoiding or minimising disruption to students’ studies. Thirdly, creditors have a general right to challenge should they consider that the education administrator is selling things “on the cheap”, for example. Finally, the Secretary of State or Welsh Ministers must approve the proposed transfer scheme. Any approval will include, among other matters, consideration of whether it is for the purposes of achieving the special objective. I believe that the quadruple lock answers the hon. Gentleman’s concerns.

I thank the hon. Gentleman for his amendments, and thank other hon. Members for their contributions to the debate. I hope that my response has reassured him, and the House, on his underlying concerns. I therefore ask that the amendments are not pressed to a Division.

[Gordon Marsden]

I have listened carefully to what the Minister has said and taken note of his views and the proposals he has made. On that basis, we are prepared to withdraw amendment 1.

On amendments 2 and 3, I heard the reassurances that the Minister has given, but when the Bill reaches the other place there needs to be a further examination of the very important issues around the pension schemes. I am not entirely convinced that the assurances, which I am sure have been made in good faith, will actually do the business.

As regards amendment 22, I thank the Minister for his explanation of what he described as the quadruple lock, but I am afraid, not least because of seeing past practice, that we have to plan in this Bill not for the best circumstances but for the worst. This is also a really important issue of public policy that we should establish within the Bill. On that basis, we wish to press amendment 22 to a vote. I beg to ask leave to withdraw amendment 1.

Amendment, by leave, withdrawn.



Schedule 2

Education administration: transfer schemes

Amendment proposed: 22, page 30, line 39, at end insert—

“3A The education administrator may not transfer assets of any further education body to a for-profit private company where he or she considers that more than half of the funding of the acquisition of the asset came from public funds.”—(Gordon Marsden.)

This amendment would ensure further education bodies with a track record of accruing assets publicly, could not be transferred to a for-profit private company.

Question put, That the amendment be made.

--- Later in debate ---

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I can now inform the House of my decision about certification. For the purposes of Standing Order No. 83L(2), I have certified clauses 2 to 38 of, and schedules 2 to 4 to, the Technical and Further Education Bill as relating exclusively to England and Wales and within devolved legislative competence, and clause 1 of, and schedule 1 to, the Bill as relating exclusively to England and within devolved legislative competence. Copies of my certificate are available in the Vote Office.

Under Standing Order No. 83M, consent motions are therefore required for the Bill to proceed. Does the Minister intend to move the consent motions?

[Robert Halfon]

indicated assent.

The House forthwith resolved itself into the Legislative Grand Committee (England and Wales) (Standing Order No. 83M).

[Mr Lindsay Hoyle in the Chair]

[The Chairman of Ways and Means (Mr Lindsay Hoyle)]

I remind hon. Members that if there are Divisions, only Members representing constituencies in England and Wales may vote on the consent motion for England and Wales, and only Members representing constituencies in England may vote on the consent motion for England. As the knife has fallen, there can be no debate

Motion made, and Question put forthwith (Standing Order No. 83M(5)),

That the Committee consents to the following certified clauses of the Technical and Further Education Bill:

Clauses certified under Standing Order No. 83L(2) as relating exclusively to England and Wales and being within devolved legislative competence

Clauses 2 to 38 of, and Schedules 2 to 4 to, the Technical and Further Education Bill.—(Robert Halfon.)

Question agreed to.

The House forthwith resolved itself into the Legislative Grand Committee (England) (Standing Order No. 83M(4)(d)).

Motion made, and Question put forthwith (Standing Order No. 83M(4)(d)),

That the Committee consents to the following certified clauses of the Technical and Further Education Bill:

Clauses certified under Standing Order No. 83L(2) as relating exclusively to England and being within devolved legislative competence

Clause 1 of, and schedule 1 to, the Technical and Further Education Bill.—(Robert Halfon.)

Question agreed to.

The occupant of the Chair left the Chair to report the decisions of the Committees (Standing Order No. 83M(6)).

The Deputy Speaker resumed the Chair; decisions reported.

--- Later in debate ---

[Robert Halfon]

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

I want to give my special thanks to all the individuals who have shared their time and knowledge during the Bill’s passage through the House, to the officials who have worked so hard to bring it before Parliament and to those providing written and oral evidence. I would like to thank members of the Committee for their diligent approach and careful consideration of the practical implications of the Bill, and Members who have already spoken today.

I am clear about the priorities that we want to see in apprenticeships, further education and skills, creating a ladder of opportunity for all. These include a transformation of prestige and culture; widespread, high-quality provision; a system that addresses our skills needs; social justice; and job security and prosperity. The Bill seeks to build those priorities into our system, bringing to life the fundamental reforms needed to ensure that we have a skills and education system that rivals the best in the world.

For too long, technical education has been overly complex, overlooked and undervalued. Putting employers at the heart of these changes, as demonstrated through the current apprenticeship reforms and as recommended by Lord Sainsbury’s independent report, we can provide a clear route to employment for our young people. The changes in the Bill will support the achievements of those young people from difficult backgrounds, such as those with special educational needs or disability. In response to what my hon. Friend the Member for North Swindon (Justin Tomlinson) said earlier, we are doing a lot to implement the Maynard reforms, we are spending £2 million to help apprentices with mental health difficulties, and we announced over Christmas that apprentices with severe hearing problems will be able to do sign language instead of English as a functional skill.

We expect individuals with SEND to be over-represented on technical education routes: 23% of those who access technical education routes will have some form of special educational need compared with 7% of those taking level 3 academic qualifications, and 20% of those in the cohort as a whole.

The measures in the Bill will drive up the productivity of our country, turning us into an apprenticeship nation and providing the skills we need for our country to thrive. That is why the CBI has said:

“Businesses have long called for a vocational route…so today’s proposals are a real step forward.”

[David Rutley]

I thank my right hon. Friend for the incredible work he has done in taking the Bill forward and I commend him for his efforts. Does he agree that one of the most important factors is engaging businesses in these apprenticeships and making the route to skills more relevant for business so that this will not only help to address the productivity challenges that he has mentioned, but improve life chances for the young people involved, too?

[Robert Halfon]

My hon. Friend, whom I thank for his work on the Committee, is absolutely right. We introduced the apprenticeship levy to change behaviour and involve businesses in supporting apprenticeships, we have created the institute and the employer panels, and we are giving huge financial incentives to businesses, especially small businesses, to ensure that they hire apprentices.

The Bill also introduces an insolvency regime for the further education sector that will, in the unlikely event of a college insolvency, provide clear-cut protections for learners to minimise disruption to their studies as far as possible, while offering certainty to creditors. During oral evidence, we heard from representatives of the Association of Colleges, Collab and others, who supported the insolvency regime and the protections that it includes for learners. Although there were issues about which the banks had questions, many spoke in support of the clarity provided by the proposed measures. Santander told us that it was keen to lend more to the further education sector, and said:

“On the Bill and the proposed insolvency regime, we are actually supportive of the clarity that they provide.”––[Official Report, Technical and Further Education Public Bill Committee, 22 November 2016; c. 38, Q41.]

[Kelvin Hopkins]

As the Minister will remember, I suggested in Committee that all colleges should have professionally qualified members with financial skills in both management and governorship, so that skilled eyes would be trained on the finances to ensure that at least mistakes were not made internally.

--- Later in debate ---

[Robert Halfon]

I accept the hon. Gentleman’s premise, but, as I think I said in Committee, I do not want to put a straitjacket on colleges. The principal of Blackpool and The Fylde College acknowledged that there might be different requirements for different colleges. Nevertheless, there should be as much financial expertise as possible in further education colleges. When there is real financial leadership, those colleges will always be in good financial health whatever the funding pressures.

We forecast that, by March 2017, we will have spent a total of about £140 million on propping up colleges facing extreme financial difficulties. That money should have been spent on education and training priorities. While we envisage that only a very small number of colleges will ever find themselves insolvent, providing protection for learners and clarity for creditors is a crucial part of what we are trying to do, and of our responsibility to support the sector.

Since the Committee stage, we have been in a position to publish for consultation the Secretary of State’s draft strategic guidance. Following our conversations about the importance of incorporating the views of students in the running of the institute, it will come as no surprise that the guidance sets out our firm expectation that the institute will establish an apprentice panel by April this year. The panel will report directly to the board, ensuring that the learner voice—the apprentice voice—is at the heart of the institute. I am glad that the hon. Member for Blackpool South (Gordon Marsden) is encouraged by our approach. We also intend to publish for consultation, before the institute becomes operational in April, an operational plan for the institute which will set out in more detail how it intends to carry out its functions.

As for the insolvency elements of the Bill, we discussed in Committee the protections given to students through the special objective, and the possible ways in which the education administrator could ensure that disruption to students’ studies was avoided or minimised. In particular, we discussed whether the particular regard that the education administrator must have to the needs of students with special educational needs and disabilities should be extended to any other groups. I also recognise the importance of taking account of the needs of care leavers, recognising that they may need additional personal or pastoral support to deal with any uncertainty or upheaval should their college ever be subject to insolvency. Such support is best provided for each individual by a local authority-assigned personal adviser. As I said earlier, we will take steps to ensure that the guidance being produced for local authorities on their corporate parenting responsibilities includes advice on the role of personal advisers in the event that the young people for whom they are responsible attend colleges that enter education administration.

There is much to be proud of in our current system, given that 71% of FE colleges are good or outstanding and more than 50% are in good financial health, the proportion of 16 to 18-year-olds in education or taking up apprenticeships is at a record high, the reforms made following the 2011 Wolf review have raised the quality of qualifications, and 88% of students were recorded as having a sustained education destination in the year after key stage 5.

We know that high-quality further education can have a truly transformative impact on young people. That is why we announced as part of the spending review that we will protect the 16-to-19 national base rate of £4,000 per student for the duration of this Parliament. By 2020, if we include the adult education budget, the 19-plus apprenticeship funding and advanced learner loans, more funding will be available to support adult further education participation than at any time in England’s history.

The measures in this Bill will build on the key priorities, enabling students to make better choices about their future, with the opportunity to gain qualifications valued by employers that will secure their future prosperity and that of our nation.

[Rebecca Pow (Taunton Deane) (Con)]

In my constituency we are very fortunate in having Richard Huish sixth-form college, which has just been shortlisted as one of the six best sixth-form colleges in the country for The Times award. It runs apprenticeship courses, but there are concerns that it cannot get enough students to apply for some of the business admin courses. There is a real demand from business for those students, yet there are loads of apprentices doing courses where business does not really have jobs for them. Does the Minister agree with me and the principal of the college that provisions in this Bill to develop the synergy between education, apprenticeships and business are welcome, and indeed vital in addressing the skills shortage in this country?

[Robert Halfon]

I thank my hon. Friend for her intervention, and she is absolutely right: everything this Government are doing—the apprenticeship levy, this Bill, FE and technical education reform, the drive up of standards, the encouragement of apprenticeships, the money we are putting in with £2.5 billion that will be doubled by 2020—is designed to solve the problems she has talked about.

The OECD has said about the skills plan that

“the UK has a promising plan to advance technical education from a last resort to a first choice.”

Colleges, too, have spoken highly of the plan, including the principal of my own Harlow College, who said:

“As colleges we are not just about courses, we are about careers—we therefore believe that any reform that brings us closer to employers means our students gain higher skills and better jobs.”

This Bill is a Ronseal Bill: it does what it says on the tin. It transforms the prestige and quality of apprenticeships and technical education in our country, addresses the skills deficit, protects students in the event that colleges face extreme financial difficulty, and ensures that the most disadvantaged are able to climb the ladder of opportunity. The Bill underlines the Prime Minister’s commitment to a country that works for everyone. I commend the Bill to the House.

Technical and Further Education Bill

Robert Halfon Excerpts

Ping Pong: House of Commons
Wednesday 19th April 2017 Commons Chamber

[The Minister for Apprenticeships and Skills (Robert Halfon)]

I beg to move, That this House disagrees with Lords amendment 1.

[Mr Speaker]

With this it will be convenient to discuss the following:

Lords amendment 6, Government motion to disagree, and Government amendment (a) in lieu.

Lords amendments 2 to 5 and 7 to 18.

[Robert Halfon]

This Bill was introduced to transform the prestige and culture of technical education, providing young people with the skills that they, and our country, need. It provides necessary protection for students should colleges get into financial difficulty, and ensures that the most disadvantaged are able to climb the ladder of opportunity. It left this House after thoughtful scrutiny and, after similar diligence in the other place, I am delighted that it returns for consideration here today.

I ask hon. Members to support the Government on all amendments made to the Bill in the other place except amendments 1 and 6, where we have tabled an amendment in lieu. Amendment 1 impinges on the financial privilege of this House. I urge the House to disagree to that amendment and will ask the Reasons Committee to ascribe financial privilege as the reason.

The amendment, costing more than £200 million per year by financial year 2020-21, would mean that the parents of apprentices aged under 20 would continue to be eligible for child benefit for those young people as if they were in approved education and training. It is an issue in which I have a great interest. Apprenticeships provide a ladder of opportunity, and we should seek to remove obstacles to social mobility wherever we can.

A young person’s first full-time job is a big change for them and for their family, and it marks a move into financial independence that should be celebrated. I know that the adjustment can be challenging for the young person learning how to manage a starting wage and new outgoings and for parents who may experience a fall in income from the benefits they previously received for that dependent child. One of the core principles of an apprenticeship is that it is a job, and it is treated accordingly in the benefit system. It is a job that offers high-quality training and that widens opportunities. Moreover, more than 90% of apprentices continue into another job on completion. Most apprentices are paid above the minimum wage. The 2016 apprenticeship pay survey showed that the average wage for all level 2 and 3 apprentices was £6.70.

[Kelvin Hopkins (Luton North) (Lab)]

Although what the Minister is saying is correct, in that those apprentices will be paid, taking child benefit away from low-income families will be a disincentive for them to take up apprenticeships. Those families will be pressed to stay in education so that they can continue to get child benefit. Is that not the case?

[Robert Halfon]

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.

The apprenticeship programme already supports low-income groups. The funding system gives targeted support to the participation of care leavers, and this year we are making £60 million available to training providers to support take-up by individuals from disadvantaged areas. We are committed to ensuring that high-quality apprenticeships are as accessible as possible to people from all backgrounds. We will take forward the Maynard recommendations for people with learning difficulties and our participation target for black and minority ethnic groups.

With regard to the amendment’s suggestion of a bursary for care leavers, I understand that some young people have greater challenges to overcome. That is why we are providing £1,000 to employers and training providers when they take on care leavers who are under 25. We will also pay 100% of the cost of training for small employers who employ care leavers. There is scope for apprenticeships to benefit social mobility even more. We are working across Government to use the apprenticeship programme to extend opportunities.

I am grateful to Lord Storey for tabling Lords amendment 6, which introduces a new clause into the Bill to require Ofsted to take into account the quality of the careers offer when conducting standard inspections of further education colleges. I welcome the work that Ofsted has already done to sharpen its approach. Matters relating to careers provision feature in all the graded judgments made by Ofsted when inspecting FE and skills providers. Destination data—published in 16 to 18 performance tables for the first time this year—are also becoming an established part of college accountability. Those are important steps.

I pay tribute to the good work that is already being done throughout the FE sector to prepare students for the workplace. Ofsted’s annual report for 2015-16 cites the excellent work of Derby College, which has set up employer academies so that learners benefit throughout their course from a range of activities, including workplace visits, talks from specialist speakers, masterclasses and enterprise activities. However, Ofsted noted in the same report that the quality of information, advice and guidance in FE providers can vary and does not always meet the full range of students’ needs. That is why I want us to take this opportunity to go further.

Lords amendment 6 signals our determination to ensure that every FE student has access to good-quality, dedicated careers advice, which I know this House supports. That is vital if we are to tackle the skills gap and ensure that we make opportunities accessible to everyone. We have proposed some drafting changes to the amendment to ensure that it achieves its intended effect. The amendment makes it clear that in its inspection report Ofsted must comment on the quality of a college’s careers provision. I urge hon. Members to accept the amendment. FE colleges are engines of social mobility, and this is our chance to ensure that students from all backgrounds can access the support they need to get on the ladder of opportunity and to benefit from the best skills education and training.

I will now turn to the amendments that the Government are asking the House to accept without any further amendment. The Government support Lords amendment 2, which requires schools to give education and training providers the opportunity to talk directly to pupils about the approved technical education qualifications and apprenticeships they offer. I would like to place on the record my significant gratitude to Lord Baker of Dorking for tabling the amendment, and for his unstinting support for the Government’s technical education reforms. As I have explained, high-quality careers advice is the first rung on the ladder of opportunity and will play a key part in realising our ambition for high-quality skills education and training. The amendment will strengthen the Bill by ensuring that young people hear much more consistently about the merits of technical education routes and recognise them as worthy career paths. I urge the House to agree to it. I hope that never again when I go around the country will I meet an apprentice who was refused access to the school they were taught in to talk about apprenticeships.

[Ian Mearns (Gateshead) (Lab)]

I actually welcome that proposal. We have heard lots of evidence that schools are not allowing FE colleges and apprenticeship providers to access their students and to tell them what the options are post-16. That, of course, is because of the “bums on seats” funding regime for post-16 studies in schools. How are we going to get around the deep-seated culture in schools that prevents careers advisers and others from providing that independent, impartial advice to young people in schools?

[Robert Halfon]

The hon. Gentleman speaks a lot of sense on this issue. Every time I meet an apprentice, wherever I am in the country, I ask them, “Did your school encourage you to do an apprenticeship?” Nine times out of 10, they say that their school taught them nothing about apprenticeships and skills. We have already changed careers advice so that schools have to offer advice that includes apprenticeships and skills. I believe that Lords amendment 2 will make a huge difference, because technical bodies, apprenticeship bodies and university technical colleges will be able to go into schools, and schools will publish policy guidance on this.

I agree that a huge part of this is about cultural change. That is why my right hon. Friend the Secretary of State always talks about parity of esteem. Until we ensure that we have parity of esteem between skills and technical education and going to university—that is also a wonderful thing to do—we will not achieve the cultural change that the hon. Gentleman talks about.

[Ian Mearns]

There is a problem with that, because training providers themselves have a vested interest—just as much as the schools do—in securing those students for their courses or apprenticeships. Is it not true that we need a much more robust process for the provision of impartial advice and guidance that does not include anyone’s vested interests?

[Robert Halfon]

We are looking at careers guidance in the long term, and at how we can make it more independent and skills-focused. I think that the work of the Careers & Enterprise Company in getting more people to do work experience, along with the money we are investing in these things, will help, but there are no easy answers. There are some great private providers, FE colleges and university technical colleges that I would love to see going into schools. However, I think that this is an important step forward to change the culture and ensure that pupils have the access to learn about apprenticeships and the technical education and skills that they need.

Lords amendment 3 introduces a new clause specifically providing for regulations to be made about the delivery of documents about an insolvent FE body to the registrar, and how those documents are kept and accessed by the public. Essentially, the new clause allows for the proper management of the paperwork of an insolvency procedure for an FE body.

I am pleased that the Government were able to accept amendment 4 in the other place, which deleted the words “if possible” from clause 25(2). The original drafting of subsection (2) was intended to offer reassurance to creditors and the education administrator that the education administration would not continue indefinitely while we waited for the education administrator to achieve the impossible. Instead, it caused concern, both in this House and in the other place, that student protection was in some way lessened. That was not our intention. Having sought the confirmation of lawyers that there was no change to our policy objectives, we were content to delete the words in order to address those concerns.

Lords amendment 5 replaced the original clause in the Bill with a new version in order to fully apply, rather than replicate, the Company Directors Disqualification Act 1986 to further education bodies in England and Wales. The new version of clause 40—formerly clause 37 —still allows the court to disqualify any governors whom it finds liable of wrongdoing from being governors, and now also from being company directors in any part of the UK. It fully prevents disqualified individuals from being able to repeat the mistakes they have made in a different way, potentially at the expense of another FE institution. We have amended the clause to close a potential loophole in the Bill and more fully protect learners at FE institutions from the potential actions of any governor who acts recklessly.

--- Later in debate ---

[Gordon Marsden]

No, I am sorry, but I am not going to give way again. The hon. Gentleman has had two shouts and he is out. [Interruption.] I am going to continue, so he can stop chuntering.

This will inevitably have a negative effect on the family income in circumstances where the household budget is not covered by the earnings in an apprentice’s salary, given that the apprentice minimum wage is barely over £3 an hour. The National Society of Apprentices made that point in its submission to the Committee, saying:

“It seems inconsistent that apprentices are continually excluded from definitions of ‘approved’ learners, when apprenticeships are increasingly assuming their place in the government’s holistic view of education and skills”.

If apprenticeships are to be seen as a top-tier option, then the benefits should be top tier too. University students receive assistance from a range of sources, from accessing finance to discounted rates on council tax. Apprentices currently do not receive many of those benefits. Their lordships believe, and we agree, that the system must be changed so that both groups are treated equally.

[Robert Halfon]

I thank the hon. Gentleman for the way in which he is approaching these amendments. He mentioned that some apprentices were paid more than the apprentice minimum wage. Is he aware that 82% of apprentices are paid at or above the appropriate level of the national minimum wage or national living wage?

[Gordon Marsden]

Those figures come from the Minister’s Department, and I am not going to dispute them on this occasion. We are trying to set, in legislation, provisions that will be valid for five, 10 or 15 years. It seems far more appropriate to have a principle under which everybody has equal access. We can trade figures all day about whether this is acceptable or whether it is 10%, 15%, 20% or 25% of apprentices who are not in this position. I do not believe that we should go down this route, and Members of the House of Lords agreed when they passed this amendment.

Shakira Martin, the NUS vice-president for FE, says:

“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.”

In support of this amendment, the Learning and Work Institute has said:

“There are currently participation penalties for low income and disadvantaged young people who take an apprenticeship compared to an academic pathway. This amendment would help towards treating apprentices and students in further and higher education equally in the support and benefits system.”

The Government’s decision to exclude apprenticeships from the category of approved education or training will serve as a deterrent to young people, particularly those from disadvantaged backgrounds. Together with that, and without any change to the category that apprentices are placed in by the DWP—FE has to accept that, as things stand at the moment—the Government are providing a severe financial disincentive for young people to enter into an apprenticeship as opposed to other routes of education. The National Society of Apprentices agrees.

In the other place, the Minister’s colleague, Baroness Buscombe, said that there would be discussions about this issue with colleagues in the Department for Work and Pensions, but that did not happen. The Minister has told me on previous occasions that this needed to be addressed and discussed with other Departments, but that has not happened. This is a Government who are long on rhetoric but short on delivery, and it is young people and their families who are suffering. The Government are now blocking a modest proposal from the House of the Lords to begin to remedy their inability to do joined-up government.

[Robert Halfon]

The hon. Gentleman will know that, as I have mentioned before, we are carrying out a social mobility review of a whole range of issues, from benefits to incentives to providers and employers, to get more apprentices from disadvantaged backgrounds. It is entirely wrong to say that we are not doing so, as a significant amount of work is going into these areas.

[Gordon Marsden]

I am grateful to the Minister. The broader perspective of social mobility is a perfectly reasonable way of going forward. However, to be honest, particularly at a time such as today when we are moving to a general election, I think that most people would be interested in some movement—some jam now rather than a promise of jam possibly in future from the social mobility study. I will come on to talk about other areas where, I am afraid, the Government have moved at, to put it at its kindest, a reasonably glacial pace. That is one of the reasons I am not terribly impressed by the Minister’s argument, although, as I say, I understand and appreciate his commitment to trying to do something.

I want to speak in support of the second part of the amendment, which talks about opening benefits to care leavers by opening up access to a bursary that has traditionally been available only to university students. Young people in local authority care who move into higher education can apply for a one-off bursary of £2,000 from their local authority, and the amendment would enable care leavers who take up apprenticeships to access the same financial support.

I remind the Minister of what the Children’s Society has said. Every year, around 11,000 young people aged 16 or over leave the care of their local authority and begin the difficult transition out of care and into adulthood—to be fair to him, he recognised that in his opening remarks—and my hon. Friend the Member for South Shields tabled an amendment to the Children and Social Work Bill to provide such a local offer to care leavers. The Government have a golden opportunity to follow up on that by focusing on support that could be provided by the DWP. I am at a loss to understand why the Government are ignoring this possibility. They could make provision from the apprenticeship levy for local authorities to administer a £2,000 grant to all care leavers.

When care leavers move into independent living they often begin to manage their own budget fully for the first time, and that move may take place earlier for them than for others in their peer group. Remember that a care leaver in year one of an apprenticeship may be, and often is, earning as little as £3.40 an hour before being able to transition to a higher wage in the second year. Evidence from their services and research has revealed how challenging care leavers may find it to manage that budget, because of a lack of financial support and education. As a result, young carers frequently fall into debt and financial difficulty. The Minister really needs to put himself in their shoes. The Minister for Vulnerable Children and Families, the hon. Member for Crewe and Nantwich (Edward Timpson), could tell us all, from his own family’s perspective, how vulnerable young people who come from disturbed and difficult family backgrounds can be.

The question remains: why are the Government not prepared to retain this amendment? Fine words are all very well, but you may know, Madam Deputy Speaker, that according to the old Tudor proverb, “Fine words butter no parsnips”. Just what are the bureaucratic arguments for doing nothing to support hard-working young people and their families—and, even more so, those who do not have families to support them—to fulfil their hopes of better times via an apprenticeship? We talk about parity of esteem between HE students and apprentices, but some of these young people, because of their circumstances, struggle to have a strong sense of self-esteem.

Why have the Government not moved on this? Once again, why have the consultations with the DWP not taken place? Was the Minister nobbled by No. 10 trusties or by those in his own Department, in the same way as Department for Education Ministers seem to have led us down the garden path of reforms to GCSE resits only to slam the door shut? I say as gently as I can to the Minister that if the Government do not retain the amendment, people will know that the Government’s rhetoric has been somewhat hollow, and apprentices and their families will suffer.

I join the Minister in supporting amendment 2, which was carried in the Lords, and I also want to talk about amendment 6. The lack of parity of esteem for apprentices starts at an early age, and, as my hon. Friend the Member for Gateshead (Ian Mearns) illustrated in his useful and constructive exchange with the Minister, the rhetoric on careers advice still does not match the painful reality that faces many young people.

The reality is that careers advice has been devastated over the last Parliament and since 2010, certainly at a local level, and young people who want to take a vocational and apprenticeship route are in danger of being short-changed again in their careers advice. Despite the work of the Careers & Enterprise Company, which is still in its infancy, support in schools remains poor. Careers England—the trade body for careers advice and guidance—and the Career Development Institute have confirmed to me recently that in their view, nothing has greatly changed. They estimate that only a third of schools can adequately deliver careers advice. Taken alongside the shortage of careers advisers and the fact that the remaining advisers earn far less than they used to, it adds up to a very difficult position.

That is one of the reasons why last November the co-chairs of the Sub-Committee on Education, Skills and the Economy, the hon. Member for Stroud (Neil Carmichael) and my hon. Friend the Member for Hartlepool (Mr Wright), said that the Government had been complacent over careers advice. They said:

“The Government’s lack of action to address failings in careers provision is unacceptable and its response to our report smacks of complacency.”

I know that the Minister challenges that strongly, and I know that he has put on record that the Government are working towards a thorough careers strategy in that respect. But we have to deal with the situation as it is today, not with what it might be under a careers strategy developed by whatever Government are around at the end of the year.

In the survey conducted by the Industry Apprentice Council last year, just 42% of respondents found out about apprenticeships from school or college, and using one’s own initiative remained by far the most common way for a young person to discover apprenticeships. The council also said that there needed to be a change in careers information, advice and guidance because the proportion of respondents who said that theirs had been very poor remained high across the three surveys.

That is why the House of Lords has produced these two quite detailed and comprehensive amendments; those overall issues are not being addressed. Strong careers guidance is critical to promoting apprenticeships in schools. If we are to make a success of the institute, it is crucial that young people are alerted early enough in their school life to the importance and attraction of technical routes. That is one of the things that amendment 2 from the other House, which we supported, makes very clear.

If the Minister does not think that the Lords amendment on careers advice is necessary, perhaps he would like to explain just how and when the Government are going to get a grip on the existing fractured landscape of careers advice revealed by his own Department. Last month—it was not bedtime reading, so I will not be surprised if hon. Members have not read it—the Department for Education published a research report, “An economic evaluation of the National Careers Service”. The report was produced by London Economics, which was originally commissioned by the former Department for Business, Innovation and Skills to evaluate the impact of the National Careers Service.

The National Careers Service has changed considerably during the five years since it was introduced by the Minister’s predecessor, the right hon. Member for South Holland and The Deepings (Mr Hayes). I had the benefit of discussions with him at the time, and he was very clear when it started that the National Careers Service would principally be for the over-24s. That process has changed. I am not necessarily criticising that, but the process has certainly migrated in an unplanned fashion. The National Careers Service website says that anyone aged 13 and over can have access to the data, and that adults aged 19 and over can have access to one-to-one support. The problem is that only 15% to 22% of the customers—again, I am taking statistics from a report that the Government have commissioned—were referred by Jobcentre Plus, while the remainder were self-referring. Does that not speak volumes about the lack of joined-up government between the Department for Education and the Department for Work and Pensions?

--- Later in debate ---

[John Pugh (Southport) (LD)]

I want to speak very briefly on the Government motion to disagree with Lords amendment 6 and Government amendment (a) in lieu, as much as anything else to probe what amendment (a) will achieve. As a preface to that, let me give an impression of what the noble Lord Storey sought to achieve with Lords amendment 6. We have all acknowledged during the course of the debate so far that careers advice is incredibly variable and has been for some considerable time. Lord Storey tried to set in place a mechanism for monitoring careers advice so that we know precisely how good or how bad, and how valuable or useless, it actually is.

In Committee stage in the Lords, Lord Nash described careers advice as always having been “pretty poor”. There was, of course, an Ofsted report in 2013 that established that three quarters of schools were not providing effective advice or, as the hon. Member for Gateshead (Ian Mearns) pointed out, impartial advice. It said that the guidance given to schools was not sufficiently explicit, employers were not engaging in many cases and the National Careers Service was not effectively promoted. A key conclusion of the Ofsted report was that schools’ advice should be assessed when taking into account general school leadership, or sector leadership in the case of further education—Lords amendment 6 also applies to the FE sector.

I think that the Minister accepts all that, and I know that he has produced a variation on Lords amendment 6. I would like him to satisfy me and the House that it complies with what the Lords intended in their amendment.

[Robert Halfon]

I thank the hon. Member for Southport (John Pugh) and the shadow Minister for their speeches. I understand that the hon. Member for Southport is stepping down. He is an experienced Member of the House, and I send him every good wish for the future.

To answer the hon. Gentleman we are essentially accepting de facto Lords amendment 6, which was suggested by Lord Storey. We have just made it tighter for legal reasons and, in fact, stronger. Ofsted will now be required to comment on college careers offers in its reports. However, we accept the principle of Lords amendment 6.

I set out earlier the Government’s position that the majority of the Lords amendments serve to strengthen the measures in the Bill and ensure their success in practice. I urge hon. Members to accept all the amendments made in the Lords, with the exception of Lords amendment 1. As I explained earlier, that amendment is subject to financial privilege and I ask Members to reject it on that basis, while noting the work I have set out, which demonstrates our commitment to finding the most effective ways to address barriers and support the disadvantaged into apprenticeships.

The shadow Minister said, in essence, that we should put our money where our mouth is. It is worth remembering that we have 900,000 apprentices at the moment, which is the highest on record, and that 25% of apprentices come from the poorest fifth of areas. The Careers & Enterprise Company has more than 1,300 enterprise advisers going into schools, and they are set to target something like 250,000 students in 75% of the career coldspots in the country. The National Careers Service is there to give careers advice and CV advice, and to provide personal contact either face to face, over the telephone or on the internet. The bodies have different roles.

I ask Members to accept our amendment in lieu of Lords amendment 6, on which many noble Lords spoke. I spoke earlier of the positive activity at Derby College. It is by no means the only college taking active steps to provide high-quality careers advice to students. I have seen incredible work in my own college in Harlow and in Gateshead in the north-east of England. We want to ensure that all young people can access such support, and I ask Members to support that ambition by accepting the amendment in lieu.

[Ian Mearns]

I know that the Minister is determined and full of good intentions, but good intentions do not provide sound careers advice and guidance to young people who are in the system now. We need to see more urgency from the Government in backing up his decent intentions, to make sure that young people get the impartial advice and guidance they so deeply need as soon as possible.

[Robert Halfon]

Let me give the hon. Gentleman our intention. Given the financial climate, £90 million is no small sum of money to spend on careers, predominantly with the Careers & Enterprise Company, which has enterprise advisers going into schools. There is £20 million for mentoring services in schools. As I mentioned, enterprise advisers are going up and down the country to coldspots. The National Careers Service alone is getting more than £75 million this year to advise on careers. That is real financial backing for two very important services.

[Ian Mearns]

I am listening to the Minister. I was a member of the National Careers Service national association board prior to the invention of Connexions. I seem to remember that the national budget for careers at that time was something like £130 million. That was more than 15 years ago. In the current climate, the figures the Minister is talking about are inadequate.

[Robert Halfon]

Given the financial climate, the £90 million to be spent predominantly with the Careers & Enterprise Company and the £77 million that is going to the National Careers Service this year alone are sizeable sums of money. As I have said, we are developing a careers strategy. Obviously the election is occurring, but I hope very much that we will see careers with much more of a skills focus, and do much more work in schools on mentoring and on work experience.

I have said that the Bill is a Ronseal Bill. It is very much part of our reforms to create an apprenticeships and skills nation and to give millions of young people the ladder of opportunity to get the jobs, security and prosperity that they need. It is a Bill to ensure that technical education is held in the regard it deserves. In the unlikely event of a college insolvency, students will be protected. The measures in the Bill make vital changes to support young people to build the essential skills that our nation needs, and they provide the right support to enable young people to climb that ladder. Many Members on both sides of the House and in the other place have spoken in support of that ambition, and I take this opportunity to thank them for their ongoing commitment to the Bill and for supporting all our young people to reach their potential.

Question put, That this House disagrees with Lords amendment 1.