Lifelong Learning (Higher Education Fee Limits) Bill (Second sitting)

Toby Perkins Excerpts

Committee stage
Tuesday 21st March 2023 Public Bill Committees

[Matt Western]

Q Simon, could I briefly ask you what role the new platforms might play—online platforms particularly—in the delivery of LLE? How do we ensure that any new providers coming into this area provide quality?

Simon Ashworth: That is a really good question. You can look back in history at the individual skills accounts and some of the challenges. We have moved forward significantly and have some learnings, including ensuring that we have regulated providers who are delivering from a regulated list of qualifications. Some online platforms now negate some of the challenges we had historically around a paper-based system, which was probably a little bit of its time. There are key principles there around the controls and the providers.

As I said, the Office for Students regulates the provider base. I think we have moved on significantly from where we were previously in terms of access to providers and how the system can and does work. The whole concept of empowering learners and giving them an individual lifelong learning account is a really exciting move. It gives them much more control over where they access their provision, who they choose and when they choose it. I think it is a real game-changer for the individual. I would be less worried about some of the challenges we saw 20 years ago when we moved to a similar approach.

[Mr Toby Perkins (Chesterfield) (Lab)]

Q Matthew, we always seem to talk about skills shortages, and it feels like the sense among employers that there are skills and labour shortages now is stronger than ever. However, a recent National Audit Office report showed that in 2018-19, businesses were spending less on training than they had been nine years before. What is your sense as to why employers who recognise there are massive skills shortages are at the same time not spending the extra amount you might expect on training in comparison to 10 years before?

Matthew Percival: There is an interesting dynamic at play, particularly at the moment, around labour shortages. Given the extent of the skills and labour shortages, there is a stronger incentive and a stronger need than ever to be able to meet your skills needs, yet, at the same time, there are forces pulling in the opposite direction. I mentioned that in this environment, we have had a lot of job-to-job moves within our labour market. People have been able to move into different roles for more money, and there is pressure around salaries on hiring and salaries for retention. If you do not do something on retention salaries, you incentivise everybody to move more and to swap employers, so you get that element of the squeezing of budgets.

There are other things that we see going on in relation to the current shortage environment. There can be an element of the off-the-job opportunity cost of a worker going off to do training. When you are already short on the frontline, it is even harder to free somebody up to go and put the time into the training, and we see a number of the providers in our membership—we have a mix; as well as the plcs that we are most synonymous with, there are universities, colleges and independent providers in our membership—particularly the colleges feeling the pinch when there are these shortages. They also have their own workforce challenges, which often make it so much more difficult to be able to provide the training where the employer is willing to do so. It is more important than ever to be able to address the skills gaps, but it is also more difficult to be able to deliver that at the same time, rather than a universally positive driver towards unlocking more investment than we have.

I think we miss a trick in terms of policy to be able to think about the question of what it would take to create an environment to unlock higher levels of business investment in skills. A lot of our political debate around skills often gets focused on what the state will buy for the individual, rather than on how the state could play a role in creating an environment for higher levels of business investment. An imperative for us would be to have more of that conversation.

[Mr Perkins]

Q Simon, we just heard from Matthew that one of the reasons that businesses are not able to invest in training is their inability to access a course, maybe because the provider—whether it is from the public or private sectors—cannot recruit the lecturers or the course does not pay. One of the strengths of your members has been their relationships with employers, and what we have seen under the apprenticeship regime is that, since we have had more of an employer-led approach, the bigger employers have taken on more and more apprenticeships, and SMEs have quite often been left out. Given that one of the ideas in the Bill is that new courses will be produced—to be paid for by the learners—to what extent is there an expectation that learners at SMEs might miss out again? The bigger employers might be able to have a course with 10 to 15 employees who can come to the fore. Once again, we will have a skills system that excludes SMEs.

Simon Ashworth: I think there is a real possibility of that risk materialising. As you say, one of the big challenges for SMEs is the complexity of accessing and funding the system. We know that large employers have a significant influence, certainly on institutions, around course development and course design, so we could see some of the challenges that you have articulated replicated here in terms of the provision and some of the accessibility arrangements. As you say, on the apprenticeship side, the role of providers to support SMEs is pivotal, because SMEs and small employers tend to be time poor as well—I am thinking about their engaging with the system. But I would absolutely echo the challenges with the LLE that we have seen in apprenticeships.

[Sir David Evennett (Bexleyheath and Crayford) (Con)]

Q Your comments so far have been very interesting. There are two things I would like to raise. First, you mentioned publicity, and a lot of firms do not know what training is available. That obviously needs to be addressed by employers, politicians and the Government.

Secondly, one of the things we find when going around the country in various roles is that businesses complain that they are not getting people trained to have the skills they require. Do you think that the Bill will encourage more businesses to get more involved with universities and colleges, so that they can work together to make sure that they are encouraging colleges and universities to have the courses to fill the skills shortages? Subsequently, the firms will be able to participate in the upskilling, as well as individuals, or the Government.

Matthew Percival: I completely agree with the sentiment and the objective of how we get employers more involved in the system; I am not sure this is the mechanism we are pinning our hopes on for that. You would expect more of that objective to be achieved through a reform like the local skills improvement plans, which try to get that employer voice out to provide us with that bit more, rather than this being the specific mechanism for it.

To your earlier comment about employer engagement with programmes, the job we really have to do is not just to say, “Let’s make employers aware of the LLE”, but to ask whether we actually have a coherent story to take to employers and say to them, “This is what is valuable for you about engaging in this process and why you should do it.” If we have that story to tell, we can be a lot more effective in helping to engage people.

Often the way it comes across to employers is that there is a whole plethora of initiatives and they will say, “I am confused as to which one”. I know part of my job, as a representative employer, is to hold a bit of that challenge back to them and say, “Well, you can’t say both that you need it to be dead simple and there to be only one option, and when there is only one option say, ‘There isn’t an option that works for me.’”

We need a plurality of different initiatives and options, but we also need to challenge and support employers to navigate that environment. Rather than just saying, “Let’s try to raise awareness” and getting them to tick the box that says, “I’ve heard of the LLE”, because they might have heard about it as individuals rather than as employers, it is about how much we can get to the objective of them giving us quite a consistent message that, “This is the value in it for me, and I am confident that I know that element of it”, rather than just brand awareness.

Simon Ashworth: We refer to our members—providers —as the sales force. I think there is absolutely a role for Government to do with engaging employers. Our members—independent training providers, colleges and universities—deal with employers all the time. It is important to harness their links with industry and employers around awareness of the LLE. Ultimately, the LLE and the entitlement is about the individual as well. There is the employer demand and the employer support, but there is also the individual because, at the end of the day, it will be the individual who takes out the loan entitlement. There is a role for organisations such as UCAS to help promote that.

I would certainly encourage the Government to work with stakeholders and providers, which could do some of the heavy lifting around awareness. I do not think it is just the Government’s role to try to reach a million employers. I think they need to pull on all the different stakeholders that can promote the programme and make it a success.

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[The Chair]

With a brief final question, Toby Perkins.

[Mr Perkins]

Q Matthew, you were speaking about advertising the programme. When more businesses know about it, might some of them say, “Well, actually, I don’t have to pay for training myself any more. I don’t have to pay it through my apprenticeship levy pot. I can expect my employees to start investing in themselves, rather than me spending this money.” Do you see the possibility of this shifting the burden of who pays for training?

[The Chair]

I would love to know the answer, but unfortunately it is now 2.30 pm.

[Mr Perkins]

Oh goodness!

[The Chair]

Thank you to both Simon and Matthew. If you have anything else to say, you can always do so in writing.

Matthew Percival: Happy to follow up.

Examination of Witness

Sir Philip Augar gave evidence.

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[Matt Western]

Thank you.

[Mr Perkins]

Q There are several things that could result in this not leading to the amount of take-up that we all hope for, and one of those is not enough institutions actually offering courses in this format. You spoke in your review about the incentives for higher education institutions needing to change, and those changing their behaviour. At this stage, are you able to see whether there is enough in this to mean that we are likely to get the enough course availability for people for this to be the game changer that you hoped?

Sir Philip Augar: That is a question that I ask myself quite a lot, Mr Perkins. It is hard to come up with a definitive answer. Obviously, for the independent providers and FE colleges, this is a massive opportunity. This is a chance to completely expand their market, and I would have thought that they are already on to it. For the universities, I am not so sure, because there is considerable demand from domestic and overseas students for the full three-year degrees.

I would hope that the forward-thinking institutions are looking at that demographic downturn in 2030 and thinking that it is not far away. This will come by very quickly. The cohort that starts in 2025 will have its three years and then we are into it. I hope that the forward-thinking institutions—the type that will be interested and able to offer modularised, credit-based lifelong learning—will be thinking about this: if not now, then pretty quickly.

[Mr Perkins]

Q I will not ask you to name the forward-thinking institutions, but is there a danger that the Russell Group universities will say this is not for them, and it will be what some people see as secondary HE institutions that do it? Is there a danger that it will get seen as a second-rate option at level 6 when we get to that?

Sir Philip Augar: That is clearly a risk, but a lot depends on how lifelong learning is portrayed by the schools and colleges that are speaking to young people and parents. Not everyone is suited to an academic route. That does not make someone who pursues a vocational route a less worthy person; it just makes them different. I very much hope that we can get away from thinking it is university or bust. It is absolutely not, and this is an important way to get us there.

[Mr Perkins]

Thank you.

[Andy McDonald]

Q Sir Philip, you talked earlier about the role of parents and pupils, and their ability to make informed choices. In the course of your work, did you come to any views about engagement with business? As MPs, we see a mixed bag in terms of business engagement in the education system and the transfer of knowledge about opportunity. Did you come to any views about whether, for example, there is space in the curriculum to develop this sort of awareness and engagement? How important is that?

Sir Philip Augar: It is a very good point, and the panel did engage directly with employers and representative organisations. We had a number of roundtable meetings and invited them all along. The response varied, frankly. Some representative bodies and some employers absolutely got it. There is possibly a sense in other quarters of, “Look, this really isn’t our problem. We can’t get the staff, you know.” Actually, that is your problem. I am a big fan of the LSIPs. The engagement between local business, local education providers, chambers of commerce and the rest has the potential to close the gap that you identify, and I agree with you.

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[Robert Halfon]

Q Professor Rigby, you talked about unintended consequences. What is your view on how they should be dealt with?

Professor Rigby: Probably, in this Bill, the solution resides in that course year. If one could identify a course year with a loose allocation of credit—let’s say, plus or minus 20 or 25—that would not break the intent of the lifelong loan entitlement being a 30-credit minimum, but it allows 18-year-olds to fall over once or twice during a year and to be picked up in-year, rather than getting another £3,000 taken off their lifelong loan entitlement.

[Mr Perkins]

Q You will be aware that the legislation envisages moving from an academic to a course year, which can start at any time and run for 12 months from there. Universities, like colleges, are traditionally much more used to a big intake at the start of the academic year, checking out later on. Often, they have monetised their facilities over the summer, encouraging foreign students in that period. What sort of challenges will moving to the proposed approach pose for universities? In practical terms, do you see a lot of courses starting at other times of the year or, as it is broadly up to universities what they choose to run, will they end up choosing to run in line with when they do currently?

Dr Norton: Coventry has multiple start dates throughout the year already—we have six, I believe—so the volume of applications may increase throughout the year, which would cause some capacity issues, but overall I think it is a positive.

Professor Rigby: Most universities currently have multiple start dates, even the research-intensive ones, mainly because a lot of international students start their master’s courses in January. In the Bill as written, this is a technical realignment, which means that instead of someone starting partway through a year and their fees running through four years if they are on a three-year course, their fees will run over three years but in practice they will start and end in the same month. It is a technical change.

Throughout the Bill, I have identified a multitude of technical changes that will affect the provision of probably a couple of million existing students in order that, in ’27-28, we will start to see the roll-out of the LLE. Intuitively, I wonder why form does not follow function, in that we should design the LLE and then make sure that the funding system will permit it, rather than changing the funding system ahead and precluding some of the design opportunities that would otherwise reside in the LLE.

[Mr Perkins]

Q On your own institutions providing level 4 and 5 courses—with level 6 coming further downstream—do you anticipate offering significant numbers of those courses, or will you wait predominantly until the level 6 offer?

Professor Rigby: All undergraduate degrees tend to be 4, 5, 6. We currently accept top-ups into 5 and into 6, but there is limited demand at the moment for that provision. The real opportunity here exists in growing this ecosystem almost organically, and colleges working with their cognate universities—we are federated with Bath College, for example, and New City College in London. We are developing novel provision in that space, assuming that the funding will permit it. There is little that the funding will not permit; it is just not so obvious to the person in receipt of it. There is little in terms of top-up, one-year, short courses that we cannot do currently, but we sometimes have to look for something from commercial entities, rather than individuals taking out loans.

[Matt Western]

Q May I start with a couple of questions to you, Professor Rigby? On how the legislation is written, I have sensed concern elsewhere about giving the Secretary of State powers to remove modules or to say that they will not be funded. What is your view of how such powers might be exercised were we to have an institution or organisation where there is, not a vendetta, but a certain sense of action against it?

Professor Rigby: As I read the Bill as written, nothing gives me direct cause for concern, but it does give permissions for things to happen down the line that are not part of what is conceptualised at the moment in the lifelong learning entitlement. For example, nothing in the Bill would stop the Secretary of State in future refusing to fund a module or course in a particular discipline. Universities are worried about that, because we have seen the removal of extra funding for courses such as archaeology and design over the past few years. It makes us conscious that the Bill, while not designed for that function, gives permission to the Secretary of State to set fees at whatever level they might want for a degree that they might like, or to refuse funds at any level for a degree that they do not like. All of us around the table might worry about archaeology—notwithstanding that you did it; people do move on later—but most of us would see that design is something that is broadly useful to the economy.