Select Committee on Education and Skills Minutes of Evidence

Examination of Witnesses (Questions 1-19)


31 OCTOBER 2005

  Q1 Chairman: Can I welcome David Sherlock, Nicky Perry and Denis McEnhill to our proceedings. We all know, because I was explaining, why it is so important to see you today, and we are very happy to do so. We are going to have some quick fire questions because, again, we only have an hour in this double session so do forgive us if we whizz through. I would ask colleagues to make short, sharp questions and similarly with the replies. David, do you want to say anything to open up, as long as it is not too long, just to give us a little background?

  Mr Sherlock: Yes, very quickly. Thank you very much for inviting us to be witnesses today, Chairman. Can I make three points: The first one is that ALI is an efficient organisation. We inspect some of the cutting-edge companies in the world, BAE Systems, Rolls-Royce, BMW and companies of that kind. We need to test our efficiency all the time against them if we are to make judgments about their training. We do that by benchmarking our work externally; you have some details in our submission. The second point is that we are a highly effective organisation. Again, we apply very rigorous standards to the training of those companies in order to add value to their activities. We have a huge range of different kinds of organisations that we inspect from blue chip companies I have described, to colleges, UFI learndirect, prisons, the police service, the Armed Services and so forth. We have, as an example, reduced the inadequacy rate in work-based learning from 58% when we started in 2001 to around 10% at the current time. The third point is that we are an innovative organisation. We are absolutely not resistant to change, we have moved forward the inspection agenda very substantially in a number of ways which we can enumerate, but we are resistant to this particular change, which we believe will not save money and, indeed, will worsen the service to our clients, who include some of the most disadvantaged learners in this country.

  Q2  Chairman: The Chancellor of the Exchequer wants to get rid of lots and lots of different inspection regimes and wants three main strands. Now, who are we to stand in the way of the might of the Treasury?

  Mr Sherlock: Chairman, it is an issue which I have to say engages me somewhat from time to time and has done throughout this process. We support simplification; we support deregulation. Nevertheless this particular approach—and it is only one approach—we believe does not add value to the people who we serve. I think there is a case in many instances across the inspectorates where they were very small organisations which perhaps had some synergy coming together; we do not believe that is the case with ALI and Ofsted.

  Q3  Chairman: Does anybody else want to come in on that, Denis?

  Mr McEnhill: Yes. We have got a particularly interesting remit; David has enumerated particularly work-based learning, he has touched also on our role on employment programmes funded by the Department for Work and Pensions, adult learning in the prison service, the learndirect provision funded through UFI, University for Industry. Over five years we have developed an expertise in how to approach the inspection and the quality of these various organisations and, in a sense, how to engage with the very particular types of provider. That expertise we are very keen is not lost and our major fear with the proposal as it appears in the consultation document is that we will be talking about an inspectorate—our own currently has a budget around £25-£30 million—joining with an organisation whose budget is in excess of £200 million. We are talking about the order of 8:1. The particular safeguards or the lack of safeguards in the consultation would lead us to fear, and I think fear probably with some justification, that because the overwhelming business of that large organisation is focused on schools and on children, inevitably the attention would focus on schools and children and would be distracted from the focus of our organisation at present which is focused on workforce development and improving the skills base in this country, contributing, making a good contribution to a good new skills base in this country. It is dilution of impact which is one of our main concerns with the proposals.

  Q4  Chairman: What about the criticism you are a bunch of softies really? You go and inspect and then, disgracefully, you then try and help people to get better. That is not the rigour that we know from Ofsted: Ofsted goes in, makes their judgment on the standards and then leaves it to the school to sort out. What are you doing playing around with helping these people?

  Ms Perry: I think it depends what you believe is the purpose of inspection and our fundamental belief is it is about helping providers to improve. There seems little point in just saying that something is poor and walking away from it and waiting three or four years and going back and saying "It is still poor". Our view is that it is important to work with local funding bodies and providers to drive up improvement. We tell it how it is and we are by no means soft. We give out low grades and we stare people straight in the eye and tell them they are not doing well enough every day of the week, but our job is not finished there. The expertise of the inspectors is well-regarded by the providers and they want them, not other people, to help them improve because they value that colleague help, if you like. It is about expert guidance that they need to help them improve, and we believe that is the fundamental purpose of inspection.

  Mr Sherlock: Can I say, a lot of the organisations that we serve are not in the public sector. In many cases, the money that they get from the government is a very small proportion of their income stream. If we did not add value to their activities they could walk away and the impoverishment of the National Skills Strategy which would result from that, I think, is very significant.

  Chairman: Most of you, who know my track record, know that I have often asked Ofsted to do the job that you seem to be doing, but nevertheless. Gordon?

  Q5  Mr Marsden: We have had you in the room about five minutes and you have already blown your own trumpet rather effectively. Of course, the interesting question about this consultation is that you have a range of people blowing your trumpet for you from people as diverse as the Institute of Directors, the Association of Colleges, NIACE and the Open University, all of whom have said, in various forums, that they value very much what you are doing. I want to ask you, however, let us just assume for the sake of argument at the end of the day that you are merged into a super-Ofsted, or whatever it is going to be, how do you think the new inspection arrangements will increase value-added to the education and skills sector as a whole? Are you saying it is the existing situation or nothing or can you see circumstances if you were included in that super inspectorate in which you would not necessarily be content but be happier than you are under the existing proposals?

  Mr Sherlock: I think the proposition on the table is an enlarged Ofsted and every indication we have is that the intention would be that the culture, skills set in terms of back office functions and so forth, the attitudes and approaches that ALI has developed would be lost in that enlargement of Ofsted. I think it is perfectly possible to see ways in which a new inspectorate could be structured, in respect of the different traditions, the different approaches to serving different groups of customers that all of the organisations that would come into this new organisation might bring and might need.

  Q6  Mr Marsden: You would envisage that, if I can use an analogy, less of a takeover and more of a federation?

  Mr Sherlock: Indeed. I think that is a perfectly possible way forward. I think that is still a possibility, at least I would hope it is a still possibility but it is a matter of regret that was not included as one possibility in the consultation paper.

  Q7  Mr Marsden: Would that federation, rather than a takeover structure, enable you to retain the distinctive elements of improvement and inspection coming together which, as I say, organisations as disparate as the IOD—who I think are not generally regarded as a soft touch in these matters—have said is particularly valuable?

  Mr Sherlock: I would hope, yes. I think at the moment people have set their faces against that but I would hope more detailed discussion of these things would lead people to rather more flexible positions. I think the whole notion of an inspectorate which also works in quality improvement has been bedevilled, if you like, with positions which are perhaps open more to folklore than evidence. I think that it is assumed that there have to be conflicts of interests in those circumstances, even if one builds in, as ALI does, very substantial Chinese walls to prevent one thing leeching over into the other. I do not believe that is the case, in fact. Indeed, if you look at Ofsted, it has its schools improvement unit which deals with failing schools and which one could describe as an improvement function, just like that of ALI. I think these things can be done. I think that we could build a new organisation which brought in the best of all the predecessor organisations and thereby connected the skills strategy and the 14-19 strategy, but it would need a great deal more sensitivity and thought than I think has gone into the consultation paper so far.

  Q8  Mr Marsden: Speaking of sensitivity and thought, can I ask you about money. One of the things, obviously, which is driving this is efficiency savings, and I understand you are already in a position to promise efficiency savings for 2005-06 to DfES and DWP. There has been a report which I think DfES commissioned themselves from PriceWaterhouse which suggested that any savings from this merger would be in the region of £2.3 million a year but those would be swallowed up by the cost of bringing the bodies together for between four to nine years afterwards, and one or two of the other organisations in this sector seemed to think likewise. Is that your candid assessment of what the situation would be?

  Mr Sherlock: Yes, it is. Subsequent work has been done by the finance directors of ALI and Ofsted and I think the agreed figure—and let us say that there a degree of dispute over these issues—is about £3.3 million a year possible savings. There is a range, plainly, of the cost of the transition and that affects the payback period. It depends really on whether one, for example, closes down the relatively new office, three year old office, of ALI in Coventry and loses all the staff or whether one seeks to integrate them into a new organisation. I think that range of possible payback periods is realistic. It might be a little less, it might be rather more. It depends really on what we do in order to try to get the best out of the existing organisations.

  Q9  Mr Marsden: Can I take you to a final overview question about the potential implications of this merger/takeover, call it what you will. Many organisations who represent adult students, and particularly adult students with disabilities, notwithstanding the good work that you do at the moment, feel that there is not enough profile given to the needs of learners with disabilities, and there are a range of adult learning disabilities. In fact still the National Bureau for Students with Disabilities have just sent a briefing to the Committee with various aspects of this raised. How do you think the needs of adult learners with disabilities would be met in this new proposed structure?

  Mr Sherlock: Let me say to start with—and I will pass it over to my colleagues then—we are the only organisation that grades equality of opportunity. Certainly, we regard the equality of opportunity and diversity as absolutely at the heart of adult learning. We think that grading affects behaviour and we believe that we have seen some improvements but it has to be said that this is the weakest area of all of those that we are dealing with. For example, the grades at specialist colleges for people with disabilities and learning difficulties; 40% of them are still inadequate over a four year period, and that is a very poor record which has to be improved.

  Mr McEnhill: In my first response I mentioned the particular specialist nature of some of our work and it lies in this area. To take an example, Workstep provision, which is funded through Jobcentre Plus, DWP, is a particularly difficult issue where we have really had to work extremely hard to understand what the provision is. At the risk of telling you what you know already, Workstep provision is provision which is intended to help people get into work, essentially disabled people into mainstream employment, not protected employment or sheltered employment. That has been a tremendous problem; the inadequacy rate in that area is still very high, it is still 40%. We are working very, very closely with the DWP, with Jobcentre Plus to address some of the incredibly complex issues that exist in that provision. That sort of approach, I think, would be lost without the sort of safeguards that David talked about.

  Q10  Mr Marsden: You are saying about those safeguards, in fact disabled learners would get a bad deal under this merger?

  Mr McEnhill: I go back to what I said earlier, I fear very much for the loss of that expertise and the loss of that style of working.

  Chairman: I am sure we are going to get more of that in a moment.

  Q11  Tim Farron: I wonder how you think the style and quality of inspection would differ compared to ALI and a newly merged inspection service?

  Ms Perry: I think one of the differences, because we are a small structure and we have a flexible attitude, if you like, we can bespoke inspection to the needs of a particular subgroup of provider. For example, with disability, we do inspect it very particularly, rather than as just some other construct. I think that is a real fundamental difference about the way we work from a lot of what you perceive as the way Ofsted works. We can get those experts and that specificity down to a fairly tight set of definitions with different kinds of provision which is for the benefit of those kinds of providers.

  Mr Sherlock: Can I link your comment, Mr Farron, with Mr Marsden's point. Our understanding is that the initial thrust of this change came from Treasury considerations. There was a desire to reduce the cost of regulation and it was felt that the way to do that was to reduce the number of regulators and to narrow the scope of those regulators, in other words to cut off the useful but not absolutely core duties, if you like. Our understanding is that the quality improvement side of ALI, all the frilly bits, if I can put it that way, would be lost in a new organisation. That is our understanding from the consultation paper and discussions with colleagues. I think that the bespoke nature of inspection, which Nicky has talked about, we understand will be lost. If I can use Workstep as an example: Workstep involves some of the most respectable organisations in the country. Providers tend to be people like the Royal British Legion, the Enham Trust and so on; very experienced, very caring organisations but a new programme comes along which demands that instead of just caring for people they start to move them into mainstream work. They were unprepared for that and they failed at it. Simply inspecting them time and time again and saying "You are doing badly" drives down morale, it drives down standards. You have to find a different way of intervening in circumstances like that. We have come across those circumstances very regularly and what we seek to do, therefore, is to have many different services, some of them about improvement, some of them about support, some of them about rigorous quality assessment which used in an intelligent way can move each individual provider upwards.

  Q12  Tim Farron: You are talking about expertise I guess there. I spent all my working life, until I got to this place, in higher education, and there were a whole variety of inspection regimes over my time working in HE, most recently, the QAA. The most obvious thing is that institutions are different, very different, particularly those at the more vocational end compared with those at the blue chip end of the market. Having worked at almost both ends of the spectrum you see very often that the inspectors that come into the second variety institution will be perhaps not so worried about what those institutions do. Do you fear for your own services, do you fear for the level of expertise and specialist experience that inspectors might have in terms of the adult and vocational context?

  Mr Sherlock: I think the word Denis used was "dilution" and I think that is exactly right. We could not get away with sending non-engineers into an engineering company like Rolls-Royce, for example. It is absolutely necessary to maintain people who are specialists and to point them at provision which is appropriate to them, not to have generalist inspectors.

  Mr McEnhill: I think a problem in time would be our inspectors are specialists, yes they are experts, yes they are engineers that have come from the world of work, many of them, or from an appropriate world anyway—

  Q13  Chairman: Some of us would think the vocational end was the blue chip end.

  Mr McEnhill: —but what they also are is inspectors. They have got all the generic skills in inspection. They can do the job, they can go in and look at stuff, dissect it and give a simple message and say "This is what is good, this is what is not so good". An organisation which was focusing on the massive childcare and school agenda for this funding basis would, I believe, want to make use of that general expertise if a body of people moved into it without safeguards, the protection of the ALI.

  Q14  Tim Farron: My final point is you are getting it but really I think it is not just the expertise of the inspectors, it is the expertise of the regime. You can send inspectors in with lots of expertise to any outfit you want to inspect, working on the basis of a remit designed by generalists.

  Mr McEnhill: It is having an intelligent debate with specialists on the provider side.

  Mr Sherlock: This is a culture focused on welfare for work, workforce development and community renewal and nothing else.

  Q15  Dr Blackman-Woods: I would like you to expand on some of the comments you made earlier about the possible downside of the new single inspectorate. Why are you convinced that adult learning and business-focused activity will be pushed to the sidelines in the new single inspectorate for children and learners?

  Mr Sherlock: In terms of the particular proposals on the table at the moment, the background work that has followed those has been based on the notion that ALI will be absorbed and will disappear, essentially, in favour of an enlarged Ofsted. In other words, the organisational structure of Ofsted, as it is at the moment, is the organisational structure and culture which will go forward. That has been made very clear. We do not believe that is the right way forward; we believe that it is an enormous waste of human and financial investments that have been made over the last four or five years, and we would seek ways of realising those investments which have already been made and, indeed, producing an organisation, if there is to be a single organisation, which is better than any of the predecessor organisations. It ought to be better, different and more effective than anything we have done before, if this is to be worth doing.

  Ms Perry: It is a simple proportionality issue. The quantity, the size of the adult sector compared with all the child protection, all the schools, all the nurseries, everything else to do with children, it is out of all possibility to presume that it would retain its specialism within that body.

  Q16  Dr Blackman-Woods: Do you think the model then should be thrown out completely or is it possible to put adequate safeguards in place that will ensure the adult learning and business skills are kept?

  Mr McEnhill: I think it is possible to allay some of our fears through the governance arrangements; through the composition of the governing body; through the extent to which the chief inspector of the new outfit is held to account for the discharge of his or her duties through that board; to specify, perhaps to even go further, the type of person on that board. Also, in statute one could specify the duties of the inspectorate so that adult learning is not left as an implicit part of this job but it is explicitly required that this inspectorate reports on quality, standards and priorities to the secretaries of state of both the Department of Education and Skills and the Department for Work and Pensions. It can be done and it is relatively straightforward to draft but there needs to be a will and what that, of course, will do is alter the culture of this organisation. We believe it would make it a better organisation, it would be better than its predecessors.

  Q17  Dr Blackman-Woods: You are presumably putting some written evidence together to demonstrate that is the case?

  Mr McEnhill: We have written evidence.

  Q18  Dr Blackman-Woods: You are continuing to, because I think what we are hearing is the system could be improved. To follow up Tim's point, do you think that in the new inspectorate there will be enough people with the right sorts of skills and if that is not the case how are you going to push to get people with vocational skills to fulfil the remit?

  Mr Sherlock: I think it is unlikely to be us, if I may put it bluntly. If the proposal, as it goes through at the moment, prevails, I think the chances that the people who have developed the ALI culture would be wanted on the voyage is very small. As I say, the proposal on the table is that that culture should be subsumed in the current Ofsted. Let me make this absolutely clear. This is not a quarrel between ALI and Ofsted, absolutely not. Ofsted has a set of duties, which it discharges effectively, it is very well-known for doing so in their field but that field is not our field. What we would seek to do I think is to recognise the point that NIACE made in its submission "every child matters but every adult does too". At the moment, the interests of adults are being rather lost in the concern with children and young people. If I use an example of the kind of work that we are doing, we published in March a paper called Safer Training, which was about training for the Armed Service and welfare of recruits for the Armed Services; that is a long term programme. What has come out of that is a recognition in the Armed Services of a need to completely change the culture of training for young people entering the Armed Services. That will take us at least through to 2007, and ideally a great deal beyond. The question, therefore, in our mind is whether, in fact, that kind of work, that kind of focus, that kind of recognition of expertise can be carried forward in an inspectorate which is largely focused on the interests of children alone.

  Q19  Dr Blackman-Woods: Would it be your view that the new inspectorate could work providing the needs of adult learners?

  Mr Sherlock: I think a new inspectorate could work if it was specially tailored to do the job. I think that needs a good deal more thought and consideration.

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