Examination of Witnesses (Questions 20-39)
MR DAVID
SHERLOCK, MS
NICKY PERRY
AND MR
DENIS MCENHILL
31 OCTOBER 2005
Q20 Mr Wilson: The main driver behind
this seems to be to generate efficiencies as far as I can understand
it. Yet, there does not seem to be a prevailing view as to whether
that is going to happen. I see that PriceWaterhouse suggest that
any efficiency savings would be lost for between four and nine
years afterwards, although the Association of Colleges makes the
point that they think there may be the opportunity for savings.
What is your view on that? Do you think there will be an opportunity
for savings? Will there be efficiencies made?
Mr Sherlock: I think in any coming
together of this kind, if it is a coming together which builds
on the best, in other words which looks in an objective way at
who does what well and seeks to build on it, then almost certainly
there would be some savings. I think that is a matter of common
sense. If we take the best ICT and say "Let us build on that
from the three or four organisations coming together". If
we took the best HR and the best finances and so forth to build
it; there will be some savings. I think the value of the PWC paper,
and indeed the work that has been done subsequently by finance
directors of different organisations, is to suggest that, in fact
they will be rather small in proportion to the overall turnover
of the organisation.
Q21 Mr Wilson: Which brings me to
my next question, what sort of size of savings do you believe
can be made from this process?
Mr Sherlock: I think the calculations
are somewhere between 1-1.5%.
Q22 Mr Wilson: So, fairly small?
Mr Sherlock: Yes, I would say
it is very small, yes.
Q23 Mr Wilson: I do not know what
the size of the budget is, what is that in pounds and pence?
Mr Sherlock: Our budget is £26.5million,
Ofsted's is £200 million or so. CSCI is about £6.5 million,
I understand. Let us say that the initial aggregate is somewhere
around the £230 million mark so we are talking about a relatively
small proportion. £2.5 million or £3 million. They are
not negligible sums of money but they are actually very small
sums of money in proportion. If it takes some years to recover
them and if there are real losses to the momentum of improvement
and the skills strategy, the opportunities for vulnerable people
coming through the training programmes that we work in, then I
would suggest the game is not worth the candle.
Q24 Mr Wilson: You would say the
downside massively outweighs the upside?
Mr Sherlock: You are suggesting
the downsides considerably outweigh—
Q25 Mr Wilson: I hope you are suggesting
that, I do not want to put words in your mouth.
Mr Sherlock: Yes, I would agree
with that proposition. I believe that for the proposition that
is on the table at the moment, the disadvantages heavily out weigh
the advantages.
Q26 Mr Marsden: I want to come back
to this question of what you say and what you gain from any changes.
David, how much of your current work, roughly would you say, is
spent assessing non DfES-funded training?
Mr Sherlock: 20% is spent on DWP
training, about another 6-7% is on privately commissioned work.
What we want to get at is that £20 billion, if it is £20
billion that the TUC and CBI say is spent on training in the private
sector. I think we would see the real win for the skills strategy
as forging a real partnership between privately funded training
provided by employers largely supporting their own staff, and
indeed the kind of training that people pay for themselves, bringing
that into the ambit of the skills strategy.
Q27 Mr Marsden: It is just under
a third of what you are currently doing. If I am putting words
in your mouth, then please disabuse me, the implication of what
you are saying is that if this amalgamation went ahead without
the ring fencing that we have talked about, the ability to pick
up on that business, if I can put it that way, would be vastly
reduced?
Mr Sherlock: Certainly, the indications
from the focus groups are that employers will be willing to commission
work that adds value to their activities, as you would expect,
but they are not willing to pay for regulation, again as you would
you expect.
Q28 Mr Marsden: In financial terms,
the Government could lose out on that as well?
Mr Sherlock: I believe so.
Q29 Mr Marsden: Can I ask you a final
question, relating to this question of what might happen, the
Association of Colleges said in their submission that they have
particular concerns about the announcement that Nord Anglia would
be contracted out to deliver inspections, and they would want
to have reassurance about their ability to deliver inspections
of adult work-based learning. You may or may not wish to comment
on that but is that a legitimate question to ask?
Mr Sherlock: I think it is a legitimate
question to ask. In the new regime we have only completed two
college inspections, and I think those have gone pretty well.
I think the problems can be overcome. I think that where large
amounts of the core business of an inspectorate are contracted
out to anybody, there are problems potentially about conflicts
of interest and, for example, in this particular case ALI inspects
a number of Nord Anglia businesses. If the two organisations are
brought together, then I think one would potentially have problems
about conflicts of interest.
Mr Marsden: We have had Nord Anglia before
our Committee in a different context in the past and I am sure
if this is to go ahead we would want to have them again.
Q30 Chairman: Are you getting on
all right with the Sector Skills Council? Do they appreciate you?
Do they represent a new force, a new dynamic in the skills arena?
Ms Perry: I think it is a bit
variable, the Sector Skills Council, a lot of them are not very
well developed yet so their ability to interact with department-attached
bodies is less. We are getting on pretty well with lots of them
and I think one of the interesting reasons for the turn of events
is that they are beginning to commission us to do special pieces
of work for them. I think that is a reasonable indication of how
they feel about what we can do for them.
Q31 Chairman: They have been reasonably
supportive of you surviving as an organisation?
Mr Sherlock: Yes, I believe so.
Q32 Chairman: Some of them have been
well-established for some time and a lot of them are very new.
Mr Sherlock: Yes. I think there
are occasions, perhaps, when we have occasion to disagree with
their view on the world and I think that is probably true of the
construction industry in the last few months. Nevertheless, we
work, for example, with the Society of Motor Manufacturers and
Traders nationally which is, I think, one of the real beacons
of that kind of activity. The motor industry works together very
satisfactorily having recognised—even though they are real
rivals commercially—that something like 80% of their training
is generic. Therefore, we work with the SMMT National Academy
to quality assure their work. The same is true of the Ceramics
Academy which is based in Stoke-on-Trent and I think there are
huge possibilities arising out of that new dynamic, if you like,
of organising things sectorially rather than by government programmes.
Q33 Mr Chaytor: Can you just clarify
what the Government has said about the division of work if this
merger goes ahead? Has it been said that you will not be able
to do the DWP work and private sector work under the Ofsted umbrella
or is it merely indicated that this may not be your core business?
Mr Sherlock: The position I think
with DWP's work is not clear, I think we are far from clear who
would inspect that.
Q34 Mr Chaytor: It has not been said
definitively that this work would not transfer into Ofsted?
Mr Sherlock: No, it has not. I
think the DWP work, as I said, is not clear to us at the moment,
and it is not clear to us what the DWP's attitude to the whole
consultation will be. We are aware of the views of a number officials
but we are certainly not aware of the official stand from DWP.
We understand that the new body will be allowed to do commissioned
work but we also understand it will not be able to indulge in
activities which are about quality improvement. Certainly the
attitude coming through from the people who have been consulted
in the focus groups is that they are not interested, as I said,
in paying for just straight regulation. Why would they? They are
interested in paying for something that adds value. Our view is
that the proposition that people have been prepared to pay for—major
government organisations like the MOD and the Home Office and
so forth—is that unique combination between quality assessment
and quality improvements offered by ALI then that work would tend
to wither. That is certainly the indication and our belief is
the MOD has serious anxieties about the proposition that is currently
on the table.
Q35 Mr Chaytor: There are two separate
issues in this area of discussion. The first is whether ALI should
be merged with Ofsted and the second is whether inspections should
be separated from quality improvement. It could be perfectly possible
that ALI could be merged with Ofsted and take quality improvement
with it and it could equally be possible that ALI would remain
separate and have quality improvement divorced. My question is,
obviously you feel the preferred system is to link quality improvement
with the inspection process but given the line has been put out
that that is not going to be what happens, what would you propose
should be the future of quality, regardless of whether or not
you are merged with Ofsted?
Mr McEnhill: It is very difficult
to answer that. We passionately believe that if inspectorates
do not engage in some form of quality improvement—and the
definition of that can be very complex—if it does not engage
then it is not exploiting its true potential.
Q36 Mr Chaytor: That has been the
position with Ofsted since it was established in the early 1990s.
The national system of inspection for schools is divorced from
quality improvements, it is not going to change.
Mr McEnhill: I think it can change,
we have shown that it can change, we have shown that it can work.
Again, at the risk of telling you something that you know already,
can I say quality improvement is not necessarily cuddling up to
providers and making them feel warm and wanted, telling them how
to do it; there is a whole range of activities here. There are
some rather pithy comments about spreading good practice as though
it happens through the ether. We have found out it does not transmit
itself terribly easily from inspectorate to provider, you have
got to work at it, you have got to have delivery vehicles which
can enable it to work. Another of our activities is the notion
of quality champions. On our own, we cannot improve the quality
provision to the extent it is needed, it is the provider which
provides these catalysts and we can help, in a sense, to train
those catalysts to work within their providers for stimulating
improvement. All of those things depend upon inspectors, practising
inspectors who go in day in day out into provision and they see
what is good, what is bad and what is dreadful. They start to
form opinions about what is good and start to turn people's gaze
towards that. That is not done in that way in Ofsted currently.
Q37 Mr Chaytor: That is an argument
for an integrated process, it is not an explanation as to how
you see the future if you are not allowed to carry out that integrated
function.
Mr McEnhill: Somehow or other
there would have to be a very stretched umbilical cord between
the inspectorate and this quality improvement arm which is somewhere
elsewhere. That sounds inefficient to me.
Q38 Mr Chaytor: In the documentation
that has been put out so far, about the implications of the merger,
what has been said about quality improvement or is it just ignored?
Mr Sherlock: It asks a rather
open question in the consultation document about what would happen
to ALI's quality improvement activities. I think some people have
been tempted to answer, "Well, QIA should do it", the
new Quality Improvement Agency, but it has already been said that
QIA will not be a delivery body, it will be a body which simply
commissions others so that does not seem to be a sufficient answer.
I think the answer is that a lot of things that have been made
to work, and as Denis says, they do not happen by themselves.
The Excalibur good practice platform, for example, took us a couple
of years of seriously hard work to make happen. We worked in partnership
with Unipart plc for a year to learn how they did it and then
built on this practice and, with the support of the Department
invested an awful lot of money in making it happen. I think all
of those things are likely to wither on the vine.
Q39 Mr Chaytor: If you are confident
of the success of your track record so far, why are you not confident
of your ability to change the Ofsted culture post-merger?
Mr Sherlock: I think that the
dice are heavily loaded against our being able to do so in the
consultation as it stands. I think if we were asking for a single
thing, it would be second thoughts by the Government on that particular
issue, to have thoughts about how one might get two plus two equals
five, if you like, bringing together organisations to get a new
organisation which is better than any of them, rather than something
which is simply saying "These organisations will simply take
some of their manpower and put it into Ofsted" and hoping
that that works.
| 
