Select Committee on Education and Skills Fourth Report


5  The roles of the LSC, DfES and Government

The LSC as an intermediary between colleges and Whitehall

131. While ostensibly about further education colleges, the Foster report paid close attention to the planning and funding context in which institutions operate, and took a particularly close look at the functioning of the LSC. Broadly, Sir Andrew Foster concluded, the steps that the LSC was taken to reform its activities, laid out in the agenda for change, was likely to go some way to addressing the widely held perceptions on the ground of organisation ineffectiveness, which had dogged the early days of its development.

132. We asked Sir Andrew Foster whether he had considered, during the course of his inquiry, making a more radical set of proposals around the role of the LSC and particularly, whether he had considered the possibility of moving to a direct relationship between providers and Whitehall in the further education sector. He told us that this was a possibility he had considered, but ultimately he had concluded that FE felt very complicated and that he "bluntly did not think [...] that the system was mature enough to be able to take something which went, let us say, directly from Whitehall to the locality".[108]

133. We put it to Ministers that, increasingly, the LSC appeared anomalous when considered alongside the arrangements in place in the school sector: there, the Government was pursuing policies which in effect brought about the creation of a much more direct relationship between schools and Whitehall. Bill Rammell told us:

"I think if we attempted to fund directly from the Department without any intermediary body, certainly I do not think we would get the level of attention to detail that we need on the ground. We are talking about a budget of something like £10.4 billion. I know there are a number of critics of the Learning and Skills Council but I think it is important not just to compare the LSC with some sort of ideal but compare it with what went previously. If we think back to 2001 there was incoherence within the system, a lack of strategic focus, there were inequalities between different areas. Although I would be the first to admit—and I am sure Mark Haysom would say this as well—the LSC is by no means perfect, there has been significant progress over the last five years [...] Were we to simply say we had made that progress and we are now going to tear it all up and we are going to have a direct funding link from the Department directly to colleges, I think we would lose out significantly".[109]

The Minister also went on to say that the LSC was reducing its overheads by £40 million (out of a total of £219 million) and that this represented "a very significant gain".[110]

134. Those on the ground have not always perceived the LSC to have a worthwhile role and have sometimes questioned whether it is approaching its strategic planning functions in an appropriate manner. Recent reforms contained in the agenda for change have generated goodwill toward the organisation in this respect. We agree with the Minister and with the LSC itself that the planned redistribution to the frontline of £40 million previously destined for LSC administration is a very significant development. Nevertheless, the LSC has much to prove over the coming years—and we will be keeping the implementation of these reforms under close scrutiny. In particular, the LSC has to respond to criticisms of its tendency to make bureaucratic demands over college recruitment, course validation, and local strategies. It should give a very clear indication of its strategic role along with examples of how this will be carried out. It should reinforce its commitment to widening participation as well as strengthening the growing delivery of HE in FE by fostering much closer links with the HE sector. It needs to be more proactive in the regions, working closely with effective regional university clusters to tackle skills shortages and identify new needs and trends. The LSC told us that they would provide us with information on how savings had been reinvested, and we look forward to receiving this, along with further details of how they plan to make the organisation leaner and more fit for purpose.

The LSC as a champion for further education?

135. Over the course of this inquiry, it has also become apparent that in the eyes of some, the LSC does not have the necessary gravitas and authority to either challenge the DfES on policy decisions nor promote a positive message about the sector. This is concerning in the light of what Dr. Robert Chilton concluded in his oral evidence to us early on in our inquiry:

"They [the LSC] are in the best position. They are in a sense the body with the responsibility for regulating the market and provision. They should be able to champion it. They have the best information flows. If a positive message does not live in their mouth, we are in trouble."[111]

The AoC, for example, told us that:

"[the] LSC has not seen itself, I think, as being in a position to challenge government about the direction of some of the policy decisions they take. [...] there are occasions when it should stand up for the system that it is trying to administer and the institutions it is trying to manage. I think that has not been the history of LSC. There were occasions when FEFC in the past did take that kind of stance with government, but it has not been a characteristic of LSC in its existence."[112]

136. The LSC, unsurprisingly, refuted the suggestion that they were unwilling or unable to advocate on behalf of the sector in general and articulate providers' cases to Ministers where appropriate. Mark Haysom, Chief Executive, told us:

"I think it is unlikely, Chairman, that we will ever fall out on a regular basis publicly, because I think that the way it should work, and is going to work well, is we do go in with passion and argue on behalf of the whole system. To make it work and to have the relationships of trust that we can go forward on, I think that is probably best done across a table rather than through newspapers, and we do."[113]

137. We think it is appropriate that those at the front line are encouraged to take responsibility for promoting, and standing up for, further education. However, the LSC could play a more active role in this regard. The LSC told us that regular and divisive public disagreements between itself and the DfES are unlikely to take place, and to some extent we understand the reasons for this. However, those at the front line do need to have confidence that the LSC is "on their side". Mature, constructive challenge need not be at odds with the LSC's role as a Government agency—and we would like to see the LSC develop such an approach more visibly.

Improving the relationship between DfES and LSC

138. A particular issue identified by Foster related to the division of responsibilities between the DfES and the LSC. He told us:

"[...] at times during this period I think it has not always been clear what was the role of the LSC and what was the role of the DfES. I have said that at times I think the DfES has ended up almost doing things it has asked the LSC to do, and I think that is not very efficient. Therefore, the DfES is the Department of State, it has the Secretary of State who is making the broad policy and it has to be held to account for it, but I think there has to then be a trusting relationship between that and the LSC, which is its operational arm of its policy. But they have to have a decent working relationship about how they are going to make those things work out, and at times in the earliest years of the LSC it did not always feel like that—so we were told anyway"[114]

139. We found significant support among witnesses for Foster's findings in this area. On the relationship between the LSC and DfES, Graham Hoyle of the ALP, told us:

"I think Foster was quite right to say that needs to be clarified. Policy is going to stay within the DfES because of the ministerial involvement in that, quite rightly, and although £10 billion makes the LSC a very powerful organisation, at the end of the day overall policy and direction has got to stay with the DfES. It would be unwise for the LSC to start delving into that. Similarly, having set up the policy, if you are going to set up an organisation and give them £10 billion to deliver, then you ought to allow them a fair amount of freedom to deliver within policy parameters. That sounds pretty logical and one would argue probably should have happened. I think what Sir Andrew tripped over was the fact that clarity is not yet there. That is as an observer from the sidelines. If that is a major problem, and if Sir Andrew says it was he obviously found it to be the case, the quicker it is resolved, the better."[115]

140. The Further Education White Paper outlines a number of measures which the Government intends to take to clarify the respective roles of the LSC and the DfES. Examples include the transfer to the LSC of some areas of operational responsibility (basic skills and offender learning) and reduction of staffing in some DfES directorates on account of duplication of their roles elsewhere.

141. We welcome the changes that the DfES and LSC are together embarking on to improve the delineation of their respective roles and responsibilities. Practical measures, such as reducing staffing numbers where there are overlapping functions, and the DfES ceding control of certain operational areas to the LSC are the right way forward. However, a more mature relationship between the two bodies is clearly not just dependent on the practical reallocation of responsibilities; it is also dependent, as Foster said, on creating a greater degree of mutual trust between the LSC and the DfES —and, we would argue, the granting to the LSC of a greater degree of latitude in terms of how it achieves the broad policy objectives which the DfES quite rightly sets for it. This issue is not covered in sufficient detail in the recent white paper despite the need for further reform in this area. Improving the relationship between DfES and LSC

138.

An overall strategy for education—a national learning and funding model

142. A key contention of the Foster report was that further education's place within a holistic education and skills "system" was ill-defined; rather than being a central, interlocking part of a planned system it too often appeared as a "receptacle" for disparate policy initiatives and a place for delivering types of learning which did not fit in either the schools or universities sector. Dr Robert Chilton told us:

"FE is like Belgium [...] It was for the reason that the boundaries of Belgium were defined by the wars of France and Germany, just as FE is defined by the territorial activity of HE and schools. And like FE, Belgium also has two languages (sixth-form colleges and general FE). That is a very negative concept, because it is a boundary concept, it is a victim concept. [...] It is a porous common market of learning, and that is why you needed a common learning model, not the silos of France, Germany and Belgium but actually a trading matrix within which people could find their personal learning pathways."[116]

In Foster's original report, he argued that the "National Learning Model" should be explicitly linked to the allocation of public funds for different types of learning, and should take place alongside a "national debate", led by ministers, about the relative financial contributions to learning which should be made by individuals, employers and the state.

143. We found strong agreement for this analysis of further education as being to some degree "without a place within a wider system of education", and strong support for the way forward suggested in the Foster report. For example, David Hunter, Lifelong Learning UK told us:

"The other thing that I think is very useful [from Foster] is the concept of planning across these sectors, the national learning model that he speaks of, so that what happens in HE and FE and work-based learning and schools, et cetera, connect the layers of policy and I think that is a very positive way forward."[117]

144. In oral evidence, the Minister confirmed that it would be acting on these proposals, developing a national learning model and, alongside this, initiating a discussion about resource implications and "who pays for what". We recommend that the development of a National Learning Model should be an absolute priority for the Government. We welcome the fact that the Government has committed to publish a plan on a three-yearly basis and seek confirmation of when we can expect the publication of the first document. Early action on this area would send out a clear message that the Government had taken seriously the need to better integrate further education into its wider education strategy. The parallel "national conversation" about funding needs to be based on a much clearer research base about where investment reaps the most benefit, and for whom. If such research does not exist, it needs to be undertaken as a priority.

145. A National Learning Model should also look at facilitating easier transition between further education and higher education and improving the portability of qualifications, via quality assurances from colleges to aid progression, lifelong learning networks and as Robert Chilton said, a "relentless drive to rationalise the learning pathways so that HE recognises the strength of what is coming to it out of FE".[118] Sir Andrew Foster in his evidence pointed to the need to address the image of FE so that it was a positive one, rather than seen as second-tier to HE.

146. Additionally, the national learning and funding model needs to have a direct influence on the process of setting national targets for further education, which exert a strong influence on what providers can realistically offer. It must not be a post-hoc justification of decisions already taken about priorities and targets. If we are to move toward a more demand-led system, it also follows that the national learning and funding model should be arrived at with the real input of individuals, communities and employers.

PART-TIME STUDENTS

147. The national learning and funding model should also address the position of part-time students; it is worth noting that NIACE said of the FE White Paper that it was a "[…] missed opportunity to address the balance of investment between full and part-time students as well as people preparing to enter the labour market, returners to it, those seeking mobility in it and those who have left paid employment".[119]

TIMING OF THE FURTHER EDUCATION WHITE PAPER

148. As noted in the preface to this document, the Government is currently awaiting the final report of Lord Sandy Leitch's inquiry into the demand side of the skills equation, to complement the "supply side" analysis recently carried out by Sir Andrew Foster. We asked Ministers whether we should expect to see a "White Paper Mark II" in response to Leitch's findings, and put it to them that perhaps it would have made more sense to present their response to both Leitch and Foster in a united White Paper. Phil Hope replied:

"[...] we know we have a skills mountain to climb, the interim report has told us that. We wanted to make sure we had the supply side in good order with these changes to raise quality, to put the focus of government spend where government spend needs to be, on skills for life, on level 2 qualifications, on the employability of the workforce in a good position, so that when Sandy Leach's report comes out the sector knows the direction of travel, the role it has to play in raising the skill levels of this country."[120]

149. We sympathise to some extent with Ministers' charge that they are "damned if they do and damned if they don't". We understand that it would have been difficult to justify holding back the response to Foster until such a point in time as the full results of the Leitch review of Skills was known. However, it is a shame that timetables could not have been co-ordinated at the stage of commissioning the two sets of research, in order that they might have reported concurrently. Arguably, having both sets of analysis to hand at the same time would have given the Government a more powerful platform from which to chart future strategy for skills. This is a relatively minor point, but one that perhaps speaks to the historical approach taken to skills development, which has too often been characterised by the post-hoc badging as "strategy" of isolated initiatives which, while very often of merit in themselves, have not always added up to more than the sum of their parts.

Ministers as champions of further education

150. One issue raised by Foster, and which we pursued with witnesses, was the assertion that Ministers had not always been sufficiently attentive to FE and had not always sought to promote a positive message about the sector. The AoC told the Committee that it had carried out analyses of press releases put out by the DfES—and that these indicated a lack of support:

"[...] advocacy is an important issue in all of this, and I think ministers have failed to act in that capacity. If you look, for example, at the press releases which DfES put out for the current year, I think there are 95 in respect of schools and nine in respect of FE, and the tone is often noticeably different between schools and FE in terms of the wording. I think ministers do far less than they could do to promote the system."[121]

151. However, Martin Dunford of the ALP took a different view. He told us: "certainly having worked in this activity for 15 years, I would say the championing and promotion of skills has never been greater; whether that is enough, I do not know [...] I do not think we ought to minimise the rise up the political ladder which skills has done in the last few years. "[122]

We asked Ministers to give further details about the review of reputation which was announced in the White Paper. Bill Rammell told us:

"I think this is a really important piece of work. I would anticipate it reporting by the back end of the summer, the autumn. It is a really important piece of work, to get champions at a local and regional and national level; and to get real advocates within the system. One of the ongoing debates that I have with the Association of Colleges is about the need to recognise that within the FE sector sometimes the glass might be half-full instead of being half-empty. There are challenges, and the sector needs to challenge us about what needs to happen; but actually, if we are constantly talking about the problems within the sector, whatever they may be, we send a message outside about how well or not the FE sector is doing, which is not in the best interests of the sector and does not reflect the progress that is being made."[123]

152. We agree to a very great extent with Foster's findings that historically Ministers and other Government agencies have done far too little to promote the benefits of further education. However, Ministers deserve credit for the steps they have taken recently to speak more loudly, more often, and more positively, on behalf of further education. We were particularly pleased to hear the Minister speak of further education as "probably more life transformational than either schools or universities in terms of where it is taking people from and where it is moving them to."

153. This is a message that needs to be repeated even more frequently than is currently the case. It is important that the prime responsibility for promoting the achievement and potential of the sector is accepted to lie with Ministers, who, in running broad portfolios, need to make sure that further education is not pushed out of the picture by higher education. Similarly, there needs to be a commitment on the part of the DfES communications directorate to promote accurate and proportionate information about further education, with due regard to the amount of coverage given it, and a commitment to making sure that critical statements are justified.

154. We asked witnesses what more they thought Ministers could do in terms of promoting the sector and giving clear strategic direction. Colin Flint, speaking on behalf of NIACE, told us that he thought consideration should be given to the creation of a discrete Ministerial post for further education.[124] Others were less certain. Sir Andrew Foster told us that he "did not go there" in his report,[125] whereas the ALP told us that they were not convinced this idea should be implemented; a Minister for Further Education would inevitably, they argued, be seen to be about colleges rather than further education more generally.[126]

155. It was suggested to us that a new position of Minister of State exclusively for Further Education should be created; on reflection, we do not feel the evidence for this is clear cut, especially given the Government's intention to build closer links between higher education and further education. Given the latter, there is some logic in retaining responsibility for both under the one post. However, what is clear—and what is borne out by past experience—is that there is potential for further education to be marginalised in such a broad portfolio and this cannot be allowed to happen in the future.

OVERSEEING IMPLEMENTATION OF REFORMS

156. As noted elsewhere, Sir Andrew Foster was clear that in determining the future of further education, the evidence he had seen had convinced him that "evolutionary, rather than revolutionary" change was the preferred route. His experience in other parts of the public sector had been, he told us, that programmes of structural reform were costly to implement, took a long time to start producing results and frequently did not result in the desired outcomes. We think that this analysis is broadly correct, but see some risks in such a programme of incremental whole-system change. There is a real possibility that without very substantial and sustained commitment to the reforms at senior governmental level, they will simply founder.

157. The publication of the White Paper is a welcome sign that the Government is taking his invocations seriously and is addressing some of the issues identified around strategic leadership and the Ministerial "will" for change. Foster recommended that there should be clear and dedicated oversight of implementation; the manner of his proposals' implementation, he wrote, would be "critical to success".[127] The Government says it has partially accepted his recommendations in this regard; rather than establishing a discrete implementation unit as Foster recommended, a "clear, dedicated joint DfES/LSC programme board" will be set up to oversee progress. This would report to the Ministerial standing group. Bill Rammell told us that:

"There are two levels to it. Firstly, there will be a programme board of officials internally within the DfES, chaired by Stephen Marsden, who is the Director of Lifelong Learning and Skills. That group of officials—their responsibility will be to track the proposals, to track the implementation, to liaise with the external bodies to ensure that is happening. Also, we do want a body that will look at the relationship between colleges and the LSC and the Department, but also monitor the implementation of the proposals within the White Paper. That is the body that will be meeting within the next month or so for the first time. It will be chaired by myself. Phil [Hope] will be there as well. It will bring all the key stakeholders together, as well as some of the trade union representatives, as well as some of the college representatives. One of the things that we did very proactively in drawing up the White Paper was to go out and establish sounding boards with different groups of principals and providers across the country, to get their input. Some of those will be represented on that body, so you will have the official group, and you will then have the group that is chaired by myself. However, I am keen to see that extended beyond that so that we keep some of that interaction directly with groups of providers on the ground and keep the dialogue going. That is the most effective way to recognise the consensus we have established and make sure we drive the changes through."[128]

158. While we welcome the Government's move to establish a joint LSC/DfES programme board to oversee implementation of the reforms, we will be watching carefully for evidence that this board works in the way that Foster envisaged. We note with some disappointment that the Government appears to have decided not to establish a separate, well-defined user group to advise its programme board, comprising learners, employers and communities, as Foster recommended. We urge the Government to revisit this decision as such a group could have provided useful checks and balances on the implementation process, as well as supplying crucial intelligence on progress on the ground as experienced by the communities, individuals and employers that further education serves. This could also provide an opportunity for FE's users—communities, individuals and employers—to provide direct feedback on the impacts of nationally—established targets and funding methodologies.

Intra-departmental coherence

Conflict with schools policy

159. Pauline Waterhouse of Blackpool and the Fylde College argued that a lack of coherent policy at national level on the way that local provision at post-16 was planned often led to practical difficulties on the ground.

"[...] last year we exceeded our funding target with the LSC and effectively recruited more 16-18-year-olds and more 19-plus students than we were actually funded for. That was to the tune of just under £900,000 worth of education that was delivered without any financial support from the LSC. We are likely to exceed our targets significantly again this year. At the last count we looked to be exceeding our targets by some 232 students. At the same time as we are in this situation in Blackpool, we have discussions going on with the Local Education Authority about the provision of a new 11-18 academy in Blackpool. My concern would be why are we fostering and stimulating these debates from DfES in respect of additional post-16 provision when the Learning and Skills Council cannot fund the provision that exists already in particular areas. That is of very, very great concern indeed, that there is not a coherence and a discussion between what is going on in respect of secondary schools and in respect of what is going on in the college sector."[129]

160. In a similar vein, Jacqui Johnson of NATFHE (and also a member of her local LSC board) told us that:

"We have set up all these strategic area reviews nationally at an enormous cost and in the middle of that whole process various things were thrown out by the Government which made our position seem much weaker, things like yes, okay, schools can set up new sixth forms and that has thrown the whole thing up in the air. I could throw back the question what happened to that whole strategic area review? We were looking for a real analysis of post-16 education in this country and it seems to have gone nowhere, which was very disappointing."[130]

161. We asked Ministers about inconsistencies over who was responsible for what. Phil Hope told us that measures outlined in the FE White Paper, as well as measures to be enacted under the Education and Inspections Bill, would lead to a more coherent system:

"What is critical here is that the collaborative partnerships—and we are learning from the pathfinders that we have established already and that are proving so successful—you have two funding bodies, local authorities and LSCs covering 14-16, 16-19; and they need to work, and have a duty to work collaboratively—and the bill reinforces that, if we ever get these clauses in the bill. However, we felt that there was still that possibility of a lack of the joined-upness despite that—so to reinforce the importance of creating a clarity that one organisation takes responsibility in a strategic way, an overall way, for the whole partnership that is operating; and that is the role that we describe in the White Paper. There will still be two funding streams but there is an important [role] for the local authority to ensure that that is all working together at a local level. The LSC will still commission 16-19 provision, but will do so within a joint strategy, broad responsibility for which will be the local authority."

162. The intention is that school and college provision will be better co-ordinated and planned, to enable all young people to access to the full range of the new vocational diplomas and an appropriate range of provision at 14-19. It is clear that attention is being paid to policy development in support of this agenda. However, inconsistencies remain between the funding and planning arrangements for schools and FE colleges at policy level which translate into paradoxical, and occasionally self-defeating arrangements locally. We have heard examples of instances where the costs of provision for additional 16-18-year-olds recruited by a college cannot be met while at the same time, the opening of a new academy is being considered for the same area. Further, it is not clear that the expensive and time-consuming process of carrying out Strategic Area Reviews to determine 16+ provision in an area was justified when the conclusions arrived at were sometimes overridden by school planning decisions emanating from outside the LSC. This does not sound to us like the result of a coherent policy which enables sensible local planning.

163. The Minister told us that the FE White Paper would mean that FE colleges could expand provision at 14-19 where there was a local need. We recognise that the announcement of a presumption in favour of expansion for colleges goes some way to levelling the playing field and we hope that this indicates a reigning in of a policy that has traditionally and by default favoured school expansion whether or not this made sense in terms of local needs. The Further Education White Paper also says that local authorities will take over the main strategic responsibility for co-ordinated planning of 14-19 provision. However, we question how a situation where local authorities have strategic responsibility, but are not acting as fundholders will work in practice.


108   Q 133 Back

109   Q 565 Back

110   Q 566 Back

111   Q 208 Back

112   Qq 265-66 Back

113   Q 10 Back

114   Q 207 Back

115   Q 416 Back

116   Qq 215-16 Back

117   Q 315 Back

118   Q 218 Back

119   NIACE press notice, One step forward, two steps missed?, 27 March 2006. Back

120   Q 587 Back

121   Q 289 Back

122   Q 421 Back

123   Q 656 Back

124   Q 290 Back

125   Q 212 Back

126   Q 421 Back

127   Foster report, pp. 67. Back

128   Q 658 Back

129   Q 229 Back

130   Q 539 Back


 
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