House of Commons - Education and Skills

Select Committee on Education and Skills Fourth Report

3 The front line—learners, employers and quality

"Skills and employability" as a new focus for colleges?

25. Sir Andrew Foster told us at the beginning of our inquiry that colleges—as a key part of the further education landscape—needed urgently to adopt a clearer mission, focused around "skills and employability". Colleges, he argued, currently appeared to "do three things: they already do employability and skills, they do a lot of academic progression through A-levels and they then do adult learning and leisure learning."[21] The first of these, he contended, should be colleges' prime purpose, although not necessarily their sole one. The Government's subsequent White Paper took this message firmly on board, stating:

"We agree with Sir Andrew Foster that the key strategic role for the sector—the role in which the contribution of FE to learners' lives, to society and the economy can exceed that of any other part of the education and training system—is to help people gain the skills and qualifications for employability, so that they are equipped for productive, sustainable and fulfilling employment in a modern economy [...] FE has the leading role to play in helping both young people and adults to acquire the skills which are an essential component of a competitive economy and to develop their careers whilst they are in work, including for the self-employed. This purpose must be central and must be achieved to world class standard."[22]

It is suggested that to help bring about this focus, colleges and other providers should increasingly develop "one or more areas of specialist excellence, which will become central to the mission and ethos of the institution and will drive its improvement."[23]

26. We asked witnesses about whether they thought that colleges could and should develop a more central focus on "skills for employability". It is apparent from the evidence we took that, despite broad support for skills and employability as a central focus, agreement about what that might actually mean in practice is some way off. Pauline Waterhouse, Principal, Blackpool and the Fylde College, told us that "[...]what constitutes skills for employment would have a very, very broad definition".[24] Similarly, Barry Lovejoy, Head of colleges department, NATFHE, told us:

"One thing that we would stress is that there are different routes to employability. We must avoid, in the presentation of the new brand image, losing sight of our other agendas, such as widening participation, which many colleges have moved into and which, in fact, produces the same results; in other words, you are bringing in people to employability who are otherwise excluded."[25]

27. We discussed with witnesses how college provision—and by implication, provision offered by other organisations—might change under such a focus. We found it difficult to establish any unified vision of what areas colleges could and should withdraw from, but there was a palpable concern that too narrow and prescriptive an interpretation could result in the loss of valuable work. Pauline Waterhouse, Principal, Blackpool and the Fylde College, told us:

"[...]our renewed focus on the employability agenda should not be at the expense of social inclusion and widening participation or, indeed, the work that we do in terms of academic pathways. From my own perspective, my college very much welcomed that message. What I would like to say is perhaps what I feel the [Foster] report does not emphasise sufficiently is that economic development and social cohesion are inextricably linked and we really cannot promote and foster economic development if we are not also underpinning and nurturing social cohesion as well."[26]

28. Others from whom we heard evidence were concerned about the practical challenges that such an invocation to refine missions would bring about for colleges, in the absence of major structural reform. David Sherlock, Chief Executive, Adult Learning Inspectorate, told us:

"[...]one of my disappointments would be that Foster has set himself a sort of self-denying ordinance, if you like, against recommending structural change [...] We are relying on a fairly haphazard pattern of mergers and takeovers and so forth to rationalise that or alter it in terms of current economic needs. What the Australians did was to decide that a viable institution in the long term needed to have a turnover of about a hundred million Australian dollars (£40-£50 million) in order to be self-renewing in capital terms. They rationalised out 130 colleges to ten institutes in New South Wales and they focussed them hard into the vocational agenda. They stopped them doing their equivalent of GCSE re-takes, A-levels and so on and so forth and those went into the schools. I think if you make that kind of fairly far reaching set of recommendations about missions I think it has an awful lot of knock on consequences which need to be faced up to."[27]

29. We think this raises an important issue: skills and employability—as a key focus for colleges—has the potential to drive up quality and raise the esteem of the sector. To a large extent, though, skills and employability merely articulates what colleges already do.

30. The Government's Further Education White Paper states that:

"We are clear that within the new mission of the system and the new focus on specialisation, we need to retain breadth of provision. This applies to the system as a whole and, where appropriate, to individual institutions [...] although many forms of provision are fully within the new mission of the sector, we continue to be clear that getting young people and adults to a first, full level two is a vital part—as the minimum platform for employment. Colleges have a leading role in ensuring that as many people as possible achieve their first full level two—a crucial objective for our economy, and for the life chances of countless individuals"[28]

31. We recognise the concerns of those who are worried that skills for employability risks being interpreted too narrowly—and that valuable provision could fall by the wayside as a result. The White Paper seems to imply that the new focus is not necessarily to be used as a way to "slim down" the variety of what colleges offer, but this begs the question about what practical changes are expected to follow as colleges translate this focus into action. In order for skills and employability to be a useful guiding principle, the Government needs to spell out more clearly what this might mean for individual providers, especially in terms of what they might cease to provide and areas they would be encouraged to expand in.

32. Fundamentally, the Government needs to spell out what "skills and employability" actually includes and excludes—for example, whether this refers principally to developing the technical and generic skills relevant for particular occupations (which may be validated by qualifications) or whether it also extends to all learning which could be considered to help people develop the personal qualities and generic "soft skills" necessary for working life. It should be noted that much of the evidence taken emphasised the importance of enabling courses to provide what Chris Banks from the LSC called a "platform for employability".[29] If it is principally the former, then the Government needs to outline a much more convincing strategy for how it will maintain and develop broad range of provision overall, looking at and responding to local needs, as further education colleges rationalise their provision.

A more responsive further education system—learners and employers

LEARNERS

33. Speaking to us about the findings of his research, Sir Andrew Foster told us that colleges "very often are running things to suit themselves, not malevolently but because that is the way that they have always done it".[30] In particular, he argued, colleges were often insufficiently responsive to learners, who were not involved enough in decisions about their own learning and whose views were not regularly and consistently collected and acted upon at the institutional level. This, he argued, needed to be tackled for quality to improve:

"What came through very strongly to me was that if learners were listened to—and many of these students, as you will know in this country, are people who are disadvantaged either through their educational or personal domestic circumstances —how much it increased motivation if people felt they were being taken seriously. So for me, how you listen to learners is a very important thing to increase motivation, and motivation seems to me to give you a really strong chance of improving quality […] Before anybody says, 'Gosh, this is so much gobbledegook,' you will see in [the report] there is an example of how this works in Denmark and it is very influential, and if colleges do not do it they get fined. They do do it and it makes students feel very good […]"[31]

34. His key recommendations on learner engagement included: obliging colleges to carry out regular collections of learner views; publishing findings annually in a learner report; establishing a learner panel in all colleges; establishing LSC learner panels at local and national levels and the expansion of training programmes for learner representatives.

35. In the White Paper, the Government promised to take action on a number of fronts. Firstly, colleges will be expected to produce and publish a learner involvement strategy. They will also be expected to use the LSC's National Student Survey as a template for collecting students' views and acting upon them. Additionally, a commitment is made to expanding training programmes for student representatives.

36. We heard persuasive evidence from Sir Andrew Foster and from the NUS that student representation in colleges is one very important way of improving the quality of provision. We welcome the Government's proposals in this area. We note that a commitment has been made to expand programmes of training for learner representatives. However, since we took evidence from Ministers, the NUS have told us that they are frustrated that the extension of the learner representative training programme has not featured in any of the action plans arising from the White Paper. They argue that a structured implementation programme is needed, and we agree. We therefore urge the Government to make a clear statement on how and and when the expanded training programme will be rolled out.

37. Concurrently with this inquiry, this Committee has also been examining the issue of citizenship in schools, colleges and beyond. We have heard evidence that students derive significant benefits from close involvement in college life and think therefore that government support for student representation would tie in well with other agendas—citizenship education in particular—and is one way of embedding the citizenship agenda in non-statutory settings.

38. We also encourage the Government to go further with regard to the arrangements for collecting students' views. It is not yet clear what consequences will follow for institutions if they fail to fulfil expectations placed on them in this respect. We note that there is no suggestion in the Government's White Paper that colleges and other institutions will be compelled to publish annually the results of their student surveys. This is concerning. We were told that in Denmark, institutions failing to collect and publish student views face meaningful financial penalties. While we do not necessarily advocate such an approach for England, we seek reassurance that failure to collect and act upon student perspectives will have real consequences for providers. We also seek reassurance that colleges will be required to publish annually their findings on students' views—and to show what action they intend to take as a result. This is likely to act as a powerful incentive for improving the quality of provision.

39. There are also important lessons to be learned from what has happened recently in children's services in respect of collecting and acting upon the views of children and young people. There, the Government felt it appropriate to bring forward legislation to require inspection frameworks to be amended to take account of children and young people's involvement in the design and delivery of services. It would therefore fit well with the thrust of Government policy in other areas if student representation were made into an obligation rather than an expectation, as currently seems to be suggested. The Government says that it will be looking to Ofsted and the LSC to ensure that mechanisms for student engagement are reflected in provider development plans. We expect Ofsted and the LSC to come forward with clear proposals in this area and to make explicit how they intend to proceed in this regard.

40. One area which we feel may not have been adequately addressed in either Foster's report or in the subsequent White Paper is the issue of management support for learner involvement. Kat Fletcher, President, NUS, argued strongly that this was a key determinant of the success or otherwise of student representation:

"For me it is about how the senior management view a student union. If they view it as something that 16-year-old A-level students do then that is what it will become. If they view it as an amateur social club that organises discos and maybe does something about Red Nose Day that is what it will become, whereas if you fund it, train it, give it professional support to become the voice of the learner in the college that is what happens and that is what the best corporations do and they are the best student unions with the best representation."[32]

41. As noted, the expansion of training programmes for student representatives is welcome, but will fail to achieve its potential if it is not seen as valuable by members of the senior management team. We think that Government agencies could do more to develop in college leaders the skills and professional outlook necessary to garner meaningful student involvement. We therefore recommend that leadership training programmes (which will become compulsory for new Principals) put particular emphasis on the development of learner involvement in the running of colleges and other types of FE provision.

STUDENT REPRESENTATION AND EDUCATIONAL MAINTENANCE ALLOWANCE (EMA) ENTITLEMENTS

42. We heard evidence from the NUS that some students in colleges were losing their entitlement to Education Maintenance Allowances (EMAs) if they spent time representing the views of themselves and their fellow students. Kat Fletcher told us that some local authorities deemed such activities to contravene attendance requirements and were disallowing EMA claims from students who, for example, had attended national conferences on student representation. She went on to recommend a solution to this issue:

"We think that there should be some formalised guidance that says if you are involved in student representation and acting in that role you should not lose your Educational Maintenance Allowance. I appreciate there is a balance to be struck but I think that is something that should be taken on. It is a tiny change but one that would impact massively upon individual members and collective members."[33]

43. There is a need to ensure that entitlements to Educational Maintenance Allowances (EMAs) are not being lost because of genuine involvement in representational activities. An initial step would be for the DfES to circulate guidance to local authorities, advising them that the practice of withholding EMA payments in these cases is not acceptable. If necessary, it should also look at amending the reporting arrangements for attendance in relation to EMAs.

Employers

44. We asked Sir Andrew Foster for his assessment of employers' views of further education. He told us that the impression he had gained was:

"A mixed one. You will see in the report there are some excellent examples of where colleges are in very good relationships with local employers and things are working extremely well. There is no doubt, if you look at some of the examples, that that is the case. However, when you then talk to the CBI you get the sort of messages they have brought out as this report has come out, where they are much more keen on the idea of these services being provided by private sector providers. They want contestability, they want responsiveness in terms of at the beginning of the day and the end of the day very competitive pricing. So I think the CBI has been quite consistent."[34]

45. Our visit to the Republic of Ireland provided insight in this area. We saw examples of direct employer engagement in the design and shaping of courses relevant to the pharmaceutical industry, which appeared to be successfully "plugging" skills gaps in the local economy. Additionally, courses were being run at times that suited employees who worked shift patterns, rather than simply during normal institute opening hours. We recognise that there are examples of good practice in England in terms of provision that is highly responsive to employer needs, as does the Government. Measures for promoting good practice in this regard and for developing an "employer charter", which are brought forward in the White Paper are therefore welcome.

46. In written evidence and commenting on the White Paper, the AoC argued that the document "does not fully address the skills challenge for the UK and is particularly short on action to deal with demand-side issues (low employer investment in training, unwillingness of individuals to pay for learning, low public esteem for vocational learning)."[35] This echoed evidence we had taken prior to the publication of the White Paper, which suggested that a more responsive system would depend not only on action from colleges, but also from employers themselves. Pauline Waterhouse of Blackpool and the Fylde College, described to us her experience of dealing with one local employer in the context of increasing fees:

"[...]we were doing quite a significant amount of other [non-qualification bearing] provision for some of our employers and when it became clear this was no longer going to be funded we then, fleet of foot, as colleges tend to be, worked very hard to get the provision on to the National Qualifications Framework, and were successful in this. But then, having been urged to start to charge our local employers fees for this, I can give you an example of a very large employer in Blackpool who, when being asked to pay fees, and the fee amounts to £80 per head for each employee over the course of a year for the particular programme that Blackpool and the Fylde College is running for them, refused to pay that amount. They will not make that investment of £80 per head in their workforce. That is the kind of attitude that we are facing."[36]

^{47. When we took evidence from Sir Andrew Foster
on this issue, he told us that some of the responsibility for
a more responsive system had to lie with employers themselves:}

"I think there is a challenge to the CBI and employers to be made, which is how clear are you what your medium term skills needs are? Have you made a business case of how much it would cost? Have you then gone out to the market, be it a private provider or colleges, to have this conversation? In meeting employers, I frankly found that there were lots who had not done that and that there was some rank prejudice against colleges as well as some genuine criticism."[37]

48. Dr Robert Chilton later went on to add:

"One of the problems, if you are a small business, is that there are enormous demands on you to run the business and deal with government, and finding the extra time to then relate to the future development of a workforce with the FE college is rarely something which is a priority, so they are disengaged. We found a relatively small proportion of employers have engagement with FE, but you still have a fundamental interest in being able to find the right people to do the work that you want to do. That is why I think the Sector Skills Councils are so important, because they take a sector-wide, regional view of what the requirements are. They look at the industry, the economy locally, and therefore can act as a voice and a conduit for the collective experiences of people in business and various sorts of business. You then have to take that remit and find a way through the Commissioner, the local LSC, to then buy the courses which businesses want and then stay in touch with local businesses."[38]

49. While it is right that emphasis should be placed on improving provider responsiveness, a parallel emphasis on improvements employers should make is not always evident. The Government says that it is expecting Lord Sandy Leitch's report to consider in particular the issue of how employer demand for training and willingness to invest in it can be increased. This is very welcome. We expect the Government to act quickly on any recommendations made in this area.

50. Some Sector Skills Councils—including Skillset and CITB Construction Skills—ask for a levy from employers in their sector. Such levies represent one way of increasing the employer contribution to the costs of developing the workforce. We therefore urge the Government to consider the merits of promoting the more widespread use of levies.

51. The Government argues that Sector Skills Councils are a key interfacing role with employers, articulating skills needs and working with providers to ensure that provision reflects what their constituencies tell them is needed. We asked the Sector Skills Development Agency what work was being done to ensure Sector Skills Councils were able to reach out to SMEs. Mark Fisher, Chief Executive, told us:

"Clearly Sector Skills Councils have a responsibility to represent their whole sector. A number of the sectors are comprised largely of SMEs and they need strategies to engage. They do not need to physically engage with every single one of them but they need to be representative so that when they present their coherent voice to the supply side, it is the voice of the SMEs in the sector as well as the big employers. That is quite a big effort and we are putting some work in with the Small Business Council as to how we might improve the engagement we have with SMEs because we recognise the importance of that."[39]

52. The Government is developing a range of structural supports which are designed to assist in making training more relevant to the needs of the economy and employers, including Centres of Vocational Excellence, National Skills Academies and Sector Skills Councils. National Skills Academies and Sector Skills Councils are at a relatively early stage of their development and so the success or otherwise of these structures as vehicles for the co-ordination and articulation of employer views and needs still remains to be seen. The Government will need to satisfy itself that Sector Skills Councils are effectively articulating the needs of the full range of employers, including SMEs. It is vital that overlap and lack of co-ordination between different bodies including regional development agencies and regional Learning and Skills Councils does not occur; similarly, Sector Skills Councils must remain alert to the potential of creating overlapping qualifications. These are issues that we will want to address in our forthcoming inquiry into the organisation and funding of skills training.

A LIMIT TO DEMAND-LED PROVISION?

53. During evidence taking, we discussed with witnesses to what extent employer demand should drive the nature of provision and determine what was fundable. Mark Fisher of the SSDA argued that as a general principle, he thought that employers "should be getting more [...] leverage over the £10 billion which is spent through the public sector".[40] Moreover, Terry Watts of ProSkills told us that he thought there were sufficient "checks and balances" in the system to ensure the system did not become weighted unhelpfully toward employers:

"We are not able through our employers, however influential they are on us, to drive the mechanism and that is right because we have got other people who are also going through a form like the QCA, the Learning and Skills Council and the various other bodies that will temper any sort of enthusiasm we have for a particular direction. [...] Certainly, we are getting employers to drive it."[41]

54. Others, however, have been more circumspect about this issue, arguing for a somewhat more cautious view of the role of employer demand. Graham Hoyle, Chief Executive of the Association of Learning Providers, and speaking in the context of a discussion on apprenticeships, told us that what was in the best interests of an individual employer was not necessarily the same as what was in the best interests of the learner or the wider economy in the longer term:

"What I generally support is putting employers much more in the driving seat in terms of design. Overall, that is the right general direction but there is a danger in going too far. It almost comes back to the point you were making about employers used to do it all themselves anyway. One of the weaknesses of the traditional apprenticeship scheme was [it was] only in some sectors and it was very much geared up for the particular need not just of the sector but often the particular employer […] We have got to be very careful with the SSCs and the employer-led, which I generally support, that they do not start playing around with frameworks too much because I have heard some of them, for instance, are now talking about dropping technical certificates, and I can understand an individual employer saying that. Someone else mentioned diplomas. If they start taking out, if you like, the knowledge-based elements of it and then we start positioning apprenticeships alongside the new diplomas as they come online, we will completely devalue apprenticeships in the future and do them inestimable damage. I think there are some real tensions here about the correct oversight and direction which should be given by employers, and the way they have got to be positioned within the total educational framework of 16-19 and beyond."[42]

55. Interestingly, we found resonances of this debate in Ireland; that while it was important to be responsive to employers, there also needed to be some limits on the extent to which they were able to determine the form learning took and the types of learning which were fundable; sometimes they would be focused on a short-term, rather than longer term view.

Sir Andrew Foster told us that in his opinion, the risk of a demand-led system becoming riddled with tensions between different parties was some way off:

"I would like to see a much stronger input of what the student had to say and what the employer had to say. I think it is quite possible that they would be in conflict, but I think it would be a much better system if there was regular input of what employers said and what students said. That, I think, would make colleges even more relevant than they currently are."[43]

56. We welcome the Government's recognition that a more "demand-led" approach is a priority for further education, and the measures it is proposing in this regard. Clearly, such a system is some way off at the moment. A truly demand-led system is predicated heavily on the successful operation of Sector Skills Councils as well as improvements in the way individual providers relate to local employers. It also relies on employers being able to clearly articulate to FE colleges and other providers what their short- and longer-term training needs are, while also recognising the role further education can play in meeting them.

57. In the medium term, the Government will need to take a step back and review both whether a demand-led system is becoming a reality and, in parallel, remain attentive to any tensions which may develop in the system between those with different needs. Although there is often a good "fit" between the needs of different parties, this is not always the case, particularly in the short term.

Intervention from the LSC—failing colleges and departments

58. In order to tackle areas of systemic weakness in the sector, Sir Andrew Foster suggested that the LSC should be given increased powers to intervene where colleges were providing an inadequate level of service to their local communities. Specifically, he recommended that:

"[...]colleges that do not meet the grade should be subject to a notice to improve which will last for one year. The QIA [Quality Improvement Agency] and CEL [Centre for Excellence in Leadership] should work with the LSC and the colleges to give major support to these institutions during this period. If this development work does not lead to the necessary improvements, those colleges or departments that do not pass a reinspection should be made the subject of a contestability review, organised by the LSC which could lead to: another college or provider taking over responsibility for a department or specific area of provision; another college or provider taking over the management of the college for at least five years; or closure of the college, with assets and provision responsibilities being reallocated within the area."[44]

59. The White Paper takes forward Foster's proposals in this area forward and says that it intends to "eliminate inadequate or unsatisfactory provision across the learning and skills sector by 2008, and to have a major impact on those organisations where performance is just satisfactory or not showing any improvement".[45]

60. The AoC told us they were unhappy with the proposals to give greater powers to the LSC to intervene in instances where a college, or a department within a college, was failing:

"We share the Government's desire to continue raising standards across the system, but query the need for stronger intervention mechanisms to eliminate unsatisfactory provision. We are not persuaded that the case has been made for greater LSC powers in this area and are concerned to retain adequate checks and balances in the system. We restate the need to trust governors, principals and managers to develop effective approaches to making improvements."[46]

^{61. We asked the Ministers to elaborate on how
he thought contestability would work in practice, and in particular,
how it would work in the case of failing departments rather than
colleges that were failing outright and whether the solution in
these cases was envisaged to be a competitive tender process.
Bill Rammell, Minister for Lifelong Learning, Further and Higher
Education, told us:}

"Certainly in certain circumstances there will be a competition [...] The CBI is very keen to see that opportunity for new private sector providers to come in to the market. I also think—and this is where it is important that we get the language right in describing this—there are real opportunities for highly-performing existing further education colleges as well, either to go into a competition directly to put forward a proposition that that FE college will make that provision, or we might be talking about individual departments through the process of saying that there is a 12month intervention process. That is not necessarily a judgment just on the whole institution; it might be a particular department, and you then might be looking for a neighbouring FE college to take on that responsibility. There might as well be a greater use of federations between successful FE colleges and ones that are struggling, so there will be a variety of ways of taking this forward."[47]

62. We understand that it is only a very small minority of colleges and other providers that are failing outright. We welcome the Government's explicit statement that the degree of intervention will be directly proportionate to the scale of the problem—with the most severe measures reserved for the small number of cases where there is persistent evidence of long-term failure. A comparable system exists in the school sector, whereby the local education authorities can consider closing a school if it fails to improve after a period in special measures. If the intention of intervention in the case of failing colleges to improve the service that local communities receive, then it is difficult to argue against such an approach; purely developmental approaches in these situations have not proved particularly successful in the past and there is therefore a strong argument for change. However, we do have some concerns about the practical implications of replacing or putting out to competitive tender areas of failing provision within a college —and seek further clarification from the Government on how this will work in practice, especially in areas where there is a single provider and, potentially, few local alternatives.

"COASTING" COLLEGES

63. Both in the White Paper, and in oral evidence to us, the Government outlined plans to extend the new powers of LSC intervention to colleges beyond those deemed to be failing, to those which are "coasting"—which Bill Rammell defined to us as "satisfactory but not improving".[48] In these cases, colleges or other providers are to be issued with a formal notice to improve, and will be offered assistance to bring about change. If, at the end of the twelve month period, significant improvements have not been made, this will trigger "similarly robust but less severe" intervention measures to those applied when a provider has been judged as failing outright.[49]

64. In his report, Sir Andrew Foster made it clear that the immediate priority for the LSC should be to intervene in those cases where provision was failing outright:

"Everyone should want weak providers and weak provision to be addressed vigorously and no-one should condone coasting providers that are not striving for excellence. The short term focus should rightly be on failing providers. However, attention should increasingly be on provision where there is clearly room for improvement."[50]

65. We asked him to expand on this, and he implied that he would be cautious about extending an interventionist, competition-based approach immediately to situations where colleges were coasting rather than failing outright:

"I viewed it as being a way of challenging and discovering with those places which are already doing very poorly what can be discovered. I do raise similar questions for what is called 'coasting' and I think you would need to see from the experience of doing this for the first few years how effective it was. It clearly has a chance of being extended if you found it was successful."[51]

66. We see the logic of an interventionist approach to "coasting" colleges, especially if the emphasis in these cases is fairly and squarely on support for improvement rather than on punitive action. The Government says that its proposals to increase the LSC's powers of intervention in cases where colleges are coasting are "in keeping" with the granting of intervention duties to local education authorities when similar circumstances arise in schools. The Government should make sure that the criteria for—and nature of—LSC intervention in cases where colleges are apparently "coasting" is defined with absolute clarity. This is especially important given the Government and the LSC commitment to develop a more "trusting" relationship with providers, as is stated elsewhere in the FE White Paper.

Expanding the base of providers

67. The Government, following Foster, have also pledged to diversify the base of providers, reducing "protectionism" and allow more independent providers to enter the market. We heard a range of views from witnesses on Foster's proposals in this area. The AoC, for example, had written that they were not in principle opposed to such an approach, as colleges "already compete[d] in an open market with funding contingent upon success in recruiting and retaining students, and a variety of other providers to whom students and employers can go".[52] Conversely, Graham Hoyle of the Association of Learning Providers (ALP) said he thought there was indeed a greater role for independent providers, including charities and not-for-profit organisations, in the further education market. Moreover, these organisations were keen to expand their role. On the issue of quality he argued that independent providers had to be of a reasonable standard otherwise they would simply go out of business:

"It is a very competitive market. Some studies were done a few years ago by city analysts where people were looking at venture capital and the venture capitalists determined that it was the highest risk market outside of oil and mineral exploration. If you are an independent provider and you do not deliver, both in terms of volume and equality ie end results, you are out."[53]

68. Furthermore, the ALP told us, independent providers had a number of specific advantages when it came to providing highly specialised vocational skills. Firstly, they were not limited by geographical constraints—this was important as employers often operate over large areas rather than in one established base. Secondly, independents often had good industry and sectoral links which improved the relevance and quality of what was taught.

69. One of the main problems, the ALP said, was that independent providers had historically been limited in that they could not contract directly with the LSC for many types of publicly-funded provision, and had relied on subcontracting relationships with colleges. This caused problems as institutions sometimes engaged in self-preservation when under threat, cutting franchised contracts. We agree that this situation whereby independent operators cannot contract directly with the Learning and Skills Council for some areas of learning needs to be looked at further and, like the Association of Learning Providers, we welcome moves by the Learning and Skills Council to make public funding more accessible to quality, established independent providers who are able to demonstrate the capacity to expand.

70. A diversified base of providers is a laudable aim and the Government, following Foster, is on the right track in this regard. We applaud the general commitment to expand the opportunities for independent providers to contract direct with the LSC for government-funded training and encourage them to take this approach further. We heard some evidence from the Association of Learning Providers of colleges abruptly ending their contract with a private provider which had been delivering "target bearing" adult basic skills courses, in an effort to protect the colleges' provision. This suggests that sub-contracting is not always in the best interests of learners or employers. We see no case for not allowing direct contracting with private operators who may have established histories of quality provision, providing they are subject to audit and inspection arrangements comparable with those being considered for colleges.

21 Q159 Back

22 FE White Paper, para 2.4. Back

23 Ibid, para 16. Back

24 Q 244 Back

25 Q 525 Back

26 Q 228 Back

27 Q 431 Back

28 FE White Paper, para 2.33 and 2.37. Back

29 Q 30 Back

30 Q 204 Back

31 Q 201 Back

32 Q 544 Back