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Mr. Sheerman: In my constituency, we have three excellent FE colleges with a first-class reputation. The problem, as the hon. Gentleman and the Minister know, is that efficiency savings can be achieved for a certain period, but there is a critical point at which those savings affect quality. That is happening in higher education. It will now happen in further education. The crucial point is that efficiency savings can be made only for so long, and then quality starts to decline fast.
Mr. Davies: I entirely agree with the hon. Gentleman.
The Liberal Democrats have made it clear that we want more investment in education. I shall not go into the details at length today, but they involve the need to fund education out of general taxation. We seek a new levy on companies--a remissible training levy--to ensure that more money is put back into higher and further education. We also want to change the funding of students, particularly degree students in higher education, to make more money available to enable an expansion of student numbers.
Mr. Pope:
The hon. Gentleman mentioned that the Liberal Democrats would increase taxation. That must be the fabled 1p on income tax to fund education, which is supposed to provide a nursery place for every three and four-year-old, to reduce class sizes, and to clear up the backlog in school repairs. He now suggests that it will fund further education as well. It must be the biggest penny in the world.
Mr. Davies:
When I voted last year and the year before against the cut in income tax, the hon. Member for Hyndburn was out in the Corridor having a smoke. I recognise the point that he makes. It is quite true that our pledge to increase taxation by 1p in the pound to invest in education is geared primarily towards education at the lower end, but some £600 million of the money that we would seek to raise would go into further higher education. I hope that that answers the hon. Gentleman's point--and rather more effectively than he dealt with a point raised by the hon. Member for Harrow, West.
Oldham sixth form college, which was established just a few years ago, has proved itself a great success in raising the staying-on rate of students and pupils
throughout the borough. The half dozen or so representatives of my party who were on the council when the college was established had doubts about whether it was advisable to set it up and abolish all the school sixth forms at the same time.
Oldham sixth form college's success over the years has shown that those doubts were unfounded. The greater staying-on rates that have been achieved have been worth the sacrifice of school sixth forms. Raising the standard of education in boroughs such as Oldham--a borough that traditionally had low educational achievement--is crucial to the regeneration of industrial towns such as the one I represent.
According to the principal, Oldham sixth form college turned away 150 applicants last year, although they were quite capable of taking on the courses--and the number who will be turned away will probably increase because of the cuts that are likely to be made next year. It is likely that 200 or more people will be turned away next year. There is a great demand for places, but there is a danger that young people will miss out because opportunities will no longer be available to them. There is also a danger that they will not be able to take advantage of the education opportunities that should be available to every citizen.
Mr. Tipping:
Does the hon. Gentleman agree that disadvantage and staying-on rates should be included as parameters for a new funding mechanism, which we must have next year, for places such as Oldham and for coalfield communities? Places that have an education deficit should get priority.
Mr. Davies:
I agree. One of the priorities--I hope that the Minister will address this--should be targeting in college funding. There must be a difference between northern boroughs, coalfield communities and the like, where educational achievement has traditionally been low, and counties such as Surrey and Sussex, where the state of affairs is very different.
What colleges need above all is stability. They need clear plans for the medium and long term so that they can prepare their strategies for the future. If they are to achieve efficiency savings, it is necessary for them to have a clear idea of what funding they will have so that they can plan. I am tired of principals telling me, "We simply don't know where we are."
Secondly, the level of funding needs to be addressed. I have already touched on that. Thirdly, there is a need for targeting funding on colleges in less affluent parts of the country. Fourthly, there is a need for urgency in the process, especially as colleges are trying to plan for next year. At the moment, the FEFC is examining options for next year. That examination must be completed quickly so that principals can make their plans for next year as soon as possible.
Mr. Bryan Davies (Oldham, Central and Royton):
We have had a most interesting debate, and I congratulate my hon. Friend the Member for Hyndburn (Mr. Pope) on initiating it, and on speaking so incisively about the issues facing the education sector.
The hon. Members for Sutton and Cheam (Lady Olga Maitland) and for Harrow, West (Mr. Hughes) seemed to deny that there has been a crisis in further education, but this debate is taking place precisely because of the crisis for which the Minister is significantly responsible and which has occasioned deep demoralisation across further education. That is why I--exceptionally for a Front Bencher--tabled an early-day motion, which was signed by 100 hon. Members and which sought to call attention to the problems facing colleges in their constituencies. My hon. Friends the Members for Pendle (Mr. Prentice) and for Hyndburn reflected on the particular problems of colleges in their constituencies. Reference was also made to acute problems in Stoke-on-Trent and in a number of other colleges.
We should dispense with the absurdity of Conservative Members who say that we should account for how we would pay for the crisis. The Government said last November that it was time Labour identified how it would fund certain parts of the education budget, but at that time we knew nothing about the funding shortfall that has led to the recent crisis. As late as January, the Secretary of State said that all was well.
The further education sector told the Minister that there was a shortfall of £80 million on previous years, and that a bill of £80 million was building up for students taking courses in the current year. The simple fact is that the Department should put its own house in order, and the Minister should get a grip on the crisis that has developed in colleges. The further education sector is crucial to education and training for the nation.
Let us get the figures clear. The hon. Member for Sutton and Cheam has great difficulty differentiating between universities and further education colleges: the subject of the debate is further education. Her figures are incorrect, because there are 3.5 million students in further education, which is more than there are in school sixth forms and universities combined. That is why the sector is so important. It deals with the skills, competences and educational opportunities of which the country is most in need. It provides the platform from which people can move on to higher education, and can equip themselves for jobs in a world in which additional skills are required.
The naivety of the hon. Member for Littleborough and Saddleworth (Mr. Davies) is at times matched only by his honesty. His party had reservations about the hugely successful Oldham sixth form college in my constituency, to which I pay tribute for its successes in recent years. His naivety was adequately exposed by my hon. Friend the Member for Hyndburn. We are told that the 1p on income tax for education will cover every element of the education budget, which runs into billions of pounds, thus producing a penny that magnifies into astronomical figures. We do not expect the Liberal Democrats to be particularly strong on mathematics. However, we expect the Minister to answer the charge that we have made today.
Mr. Chris Davies:
Did the hon. Gentleman not hear my response to the hon. Member for Hyndburn (Mr. Pope)? I pointed out that £600 million of that money would be geared to further and higher education.
Mr. Davies:
The hon. Gentleman will have great difficulty making his sums add up. Every time the Liberal
I want the Minister to deal with the obvious point that is being made in the House today, which has been made in the many letters that we have all received from across the country, about the crisis facing individual colleges because of the Government's original indication that they were not prepared to fund the demand-led element. That crisis sent alarm bells ringing. It demoralised the sector, and its implications and consequences for colleges are profound.
I suppose that the Minister at least deserves congratulations, because he has succeeded in putting further education on the map. The silent service has suddenly become an extremely noisy advocate of the role it plays, and not before time. What a pity that it has had to do that because of the crisis that has emerged. We welcome the fact that, after pressure was put on the Government, a rapid U-turn took place. It was decided that it was scarcely reasonable to tell colleges that they could not be funded for students who were already enrolled and were taking courses.
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