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What he meant was that a significantly higher proportion of the UK adult population has low qualifications, compared with the adult population of competitor countries. The Select Committee on Education and Skills, in its report on further education last September, said:

I am not sure that the Bill has the answers to those criticisms. The report also stated that

I hope that the Bill will begin to address those ongoing concerns about the sector and the UK’s skills base. It is said that the Bill embeds diversity and choice in the FE sector, and that it will raise standards and improve skills. I hope that it does. I also hope that it will cut back the sheer unwieldiness of the Learning and Skills Council and its array of partners. We will soon find out. I am not entirely convinced, however, that it will do so. After all, as my hon. Friend the Member for Havant said, this is the fourth reorganisation in about four years.

I wish to focus most of my comments, however, on the measures in the Bill that allow FE colleges foundation degree-awarding powers. FE colleges currently do not have the power to award major FE qualifications such as GCSEs or national vocational qualifications. All FE colleges have to be accredited by another institution or awarding body, such as City and Guilds, AQA or a higher education institution. What
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better way for the Government to reach their 50 per cent. target for participation in higher education than to change the rules? Will it work? I am not convinced that it will. Currently, what defines our universities is the fact that they can award degrees. UK degrees are highly respected internationally, as the numbers of foreign students who flock to the UK confirm.

As I have indicated, further education colleges perform a very valuable role, but they are rightly distinct from universities in what they do and how they do it. They do not have the academic infrastructure that our universities can support, nor do they provide an environment in which teaching is supported by research and scholarship, which is a key part of what makes education at the “higher” level different from teaching in schools and colleges. As I said, FE colleges do not currently award their own qualifications at further education level, so the Government are about to create the rather odd situation in which the only qualification a college can award on its own behalf is a degree. That risks devaluing the currency of degrees and damaging the hard-won reputation of our universities.

Dr. Blackman-Woods: Does the hon. Gentleman accept, however, that FE colleges might be much better placed than universities to deliver foundation degrees that are vocationally oriented and skills-based, and can focus on meeting the skills needs of the economy in a way that universities sometimes cannot?

Mr. Wilson: That is not the main thrust of my argument. As I continue my speech, my direction will become much clearer.

Will the proposal be worth while? Will the Government achieve the growth in the number of students taking foundation degrees as a result? We heard from the Secretary of State this afternoon that the Government hope for an increase to 100,000 by 2010. I am not sure that that will be achievable. Foundation degrees are a new type of qualification, and were introduced only in 2001. Since then, they have begun to build a reputation with students and employers, and the number taking them has increased from about 4,000 to nearly 60,000 in the past academic year. One of the reasons that students have chosen to study this new qualification is that universities have awarded them. They are not full degrees. They are often taught in further education colleges that provide them on behalf of the university, which remains responsible for their content and quality. They were intended as a “stepping stone” qualification. As such, they acted as a bridge between further and higher education for people who might not otherwise have had the confidence to consider going to university.

University heads describe foundation degrees as a valuable tool in efforts to widen participation and, clearly, they are. The Higher Education Funding Council did an analysis of entrants to foundation degrees and found that most were female, most were over 21 when they started their degrees and were more likely to come from lower socio-economic backgrounds, and the take-up among ethnic minority groups was much higher. They have been a resounding success in attracting hard-to-reach
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socio-economic groups. The old saying, “If it ain’t broke, why fix it?” applies particularly in this case.

Foundation degrees have also provided a catalyst for extensive collaboration between universities and colleges, creating pathways for learners to progress from one course to another. They work—59 per cent. of foundation degree graduates go on to further study, often at honours degree level, and often combined with work. The measures in the Bill risk breaking up those partnerships and disrupting the progression pathways for students. What incentive will universities have to collaborate with colleges, when those colleges are their direct competitors? Will students want to study degrees awarded by further education colleges? I have my doubts.

I followed closely the debate on the Bill in the other place, and I am grateful that Lord Adonis has listened to some of the concerns that have been expressed about this part of the Bill. The provision that the Privy Council can grant FE colleges foundation degree-awarding powers for an initial six-year probationary period, without the right to authorise other institutions to deliver the degrees, is a big improvement, which I welcome. After those six years, however, an FE college can apply for full powers, which allow a college unlimited ability to authorise other providers to award its foundation degrees. The Minister can deny or confirm that in summing up later. I also thank Lord Adonis for some of the amendments that he has accepted to the draft criteria for foundation degree-awarding powers, which were helpful in getting consensus.

Despite all that, I remain concerned by the prospect of FE colleges franchising foundation degrees, even after the probationary six-year period. There is a risk to quality, as the QAA has recognised. FE colleges will be taking on responsibility for the quality and standards of their own foundation degrees for the first time. That is a big change, which has lacked consultation. The Government risk producing the opposite effect to the one that they intend: instead of encouraging more people to study for foundation degrees, they may end up reducing the opportunities and the incentives to choose that qualification.

If we are to go ahead and give colleges degree-awarding powers, we will need to be sure that they can offer the same quality that our universities currently guarantee. Therefore, colleges must be subject to the same arrangements that ensure that our universities maintain high standards. If that does not happen, the foundation degree, despite its early success, will suffer from accusations that it is “only an FE qualification”, and by extension the degree brand itself will be damaged.

7.59 pm

Dr. Roberta Blackman-Woods (City of Durham) (Lab): The Bill is important for moving on the agenda for the FE sector that was outlined in the Foster report and the further education White Paper. In particular, it helps to provide that clear focus for the FE sector to concentrate on qualifications that are skills based and relate to the needs of the economy. It also helps businesses and individuals to respond to those needs. The Bill looks ahead to the fact that our FE sector
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needs to respond to changing technological and social imperatives by changing the types of qualifications that are available. Critically, it encourages the FE sector to work in partnership with other providers and businesses, and to develop and attract dynamic leaders.

I disagree with hon. Members who said that the Bill has no relevance for the Leitch review. One of the targets that Leitch set us was for more than 40 per cent. of adults to be qualified at level 4 and above by 2020, and he emphasised that we needed to do that to remain internationally competitive. Foundation degrees are, of course, level 4 qualifications and will be critical in helping us to skill our work force for the future.

As other hon. Members said, key features of the Bill relate to the new structure and role for the learning and skills councils, new powers for FE colleges to award foundation degrees, and granting LSCs the power to intervene in failing or coasting colleges. It is important that LSCs are structured with a key regional role for overseeing post-16 education. In a dynamic economy, such as the one that we are in, it is essential that skills providers can respond flexibly to the changing demands at a regional as well as a national level. On Friday, I was at the launch of the regional economic strategy for the north-east in my constituency in Durham. It was clear from both the action plan and the response from people who attended that we need to be careful to ensure that we provide the skills at a regional level that are needed for businesses in that region and that we can attend to skills shortages in the region, because they are not the same in every area of the country. It is very important that we give the LSCs that regional focus, so that they can attend not only to skills for the future but to current skills shortages.

The LSCs have been given the role of encouraging greater choice in the delivery of post-16 education and promoting the personalisation of learning. We often equate that with something that needs to happen to under-fives and, more recently, in the secondary and primary sector, but it also needs to happen in FE so that young people and adults can build on their previous experience and learning. In addition, there has to be a greater employer and student focus. We should recognise that focusing LSCs at a regional level is an important advance.

Clause 17 allows the Privy Council to grant further education institutions powers to award their own foundation degrees. That is a critical element of the Bill. We heard that about 60,000 students are enrolled in foundation degree courses, which are delivered in about 80 universities. Just over 2,000 courses are being run at the moment, with about 750 in the pipeline. As hon. Members said, that points to a successful qualification. However, it does not mean that we should not examine the degrees and see whether things can be done better.

Giving the power to FE colleges to award their own foundation degrees has proved controversial in some sections of the education community, but it is an enormous step forward in bringing foundation degrees back to the purpose for which they were originally intended. I dispute what the hon. Member for Reading, East (Mr. Wilson) said about how foundation degrees
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were formulated as a stepping stone to higher education. I think that they were formulated instead to be a higher education qualification that integrated both academic and work-based learning, and that they would be designed in partnership with employers. So they were designed initially to be a free-standing qualification, but one that was vocationally oriented.

Provided caveats are put in place—I shall discuss those later—to ensure that the quality of degrees is maintained, FE colleges with a sound track record of delivering higher education should be enabled to deliver foundation degrees with a strong skills dimension based on employer needs, especially as they now have to do that for level 2 provision onwards. That relates to what I said about defining the role of FE colleges much more clearly to be the sector that concentrates on skills-based education and vocational education.

In support of the Bill, the British Chambers of Commerce pointed out that there is an urgent need to plug the skills gap in the UK work force. Enabling foundation degrees to concentrate more closely on that skills gap is an important way forward. There also needs to be a mechanism—we have not discussed this as much as we could have done—to ensure that colleges are flexible in responding to employer need and a changing skills demand. The current system of validating those degrees through universities does not always allow that degree of flexibility.

I understand that universities have genuine concerns about losing much of their partnership work with FE colleges. They are also concerned about standards and the creation of a two-tier system. Hopefully, the measures set out in the draft criteria for foundation degree-awarding powers, which were published when the Bill went through the other place, will allay those concerns to a large extent. I note in particular the requirement that FE colleges must have four years’ experience of delivering HE; that an application for foundation degree-awarding powers will not be considered unless the FE college has consulted its students; that clear advice is given to the Privy Council to grant foundation degree-awarding powers for an initial period of six years, hence introducing the probationary period; that proper inspections and audit arrangements are in place; and that a review period is applied. Those criteria put in the necessary safeguards that have been asked for by the university sector.

Universities have done a good job already in validating the degrees and in delivering them in some cases. In my university career before I came into Parliament, I was responsible for validating a number of them. There were two problems in the validation process at the university level. As we have discussed, one was the fact that universities are academic institutions. It was often difficult to get academic staff in universities to look at the skills base of foundation degrees, rather than the academic content. The second problem was that universities often did not have the links with employers that would make foundation degrees sufficiently employer-focused. Although that has improved over time, there are still problems in relation to the close tie-in with the university sector.

There is a stronger point to be made about the loss of partnership working in modern universities, but I hope that it can develop in other ways. Clearly foundation
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degree students will need progression routes to higher education, so it will still be necessary for the further education and higher education sectors to work together to ensure that the routes exist and that one builds on the other. As I have said, however, I think it important to establish foundation degrees as a qualification in their own right. They should not be seen simply as a stepping stone.

We know that of those who complete their two-year courses, 35 per cent. go directly into employment, 27 per cent. opt for a combination of work and study, and 32 per cent. progress to further study, the aim of the vast majority being to complete an honours degree. That shows the necessity for further education colleges to provide advice for foundation degree students that includes employment options and work-based learning as well as progression to higher education. I hope that the Minister will tell us how that is to be achieved in practice.

I have useful anecdotal evidence from my further education college, which is already an excellent provider of higher education. The principal tells me that many of those studying for foundation degrees wish to return to employment, or to return to it for a period before returning to obtain professional or managerial qualifications rather than honours degrees.

Foundation degrees could also help to fulfil the Government’s stated intention to widen access to higher education qualifications. Some 28 per cent. of foundation degree students come from areas of deprivation, 65 per cent. are over 21, and 48 per cent. study part-time. The degrees are important to the Government’s aim of widening participation in higher education, and we should support them for that reason.

Mr. Rob Wilson: Some further education colleges will have powers to award foundation degrees, while many obviously will not. How does the hon. Lady think that the sector will cope with two categories of FE college?

Dr. Blackman-Woods: There is already a distinction. A number of FE colleges deliver higher-education qualifications, while a number do not. What is important is that we proceed with foundation degrees to ensure that there is a qualification that brings together skills and academic knowledge, and is very much a vocational qualification.

Further education colleges have been improving in recent years. According to Ofsted, the success rate percentage has risen from somewhere in the mid-50s to about 77. It is right for the Government to acknowledge that progress. A number of FE colleges have already proved very successful, but I can tell the hon. Member for Reading, East that they are improving, and I think that they should be given additional powers for that reason.

My local FE college, New College Durham, has new buildings and facilities, including a separate higher education building, and a strong commitment to delivering high-quality courses that reflect employer demand and the regional skills deficit. I think that it will be able to build on its substantial links with employers to improve the standing of foundation degrees in the context of future employment. It has a
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centre of vocational excellence in construction, and will be able to build on that in other sectors.

I understand that the Government intend to reinstate clauses that were removed in the other place relating to the transfer of powers from the Secretary of State to learning and skills councils to intervene in colleges that are considered to have inadequate provision, have been identified as under-performing, or have been mismanaged. I think it essential for those powers to be given to LSCs if there is to be greater confidence in further education, but there is an important proviso. The Association of Colleges has expressed concern about the fact that an LSC can remove principals or senior officers, fearing that that might contravene employment law. I hope that the Minister will tell us whether he envisages a conflict. When a college is failing, however, it may be useful for the governors to be directed by the LSC to make collaboration arrangements with another body, or to improve the management of the college. That is relevant to the provisions in clause 21 to improve leadership skills in the sector by requiring principals to obtain a leadership qualification, which, as has been said, is probably long overdue.

What should also be considered in Committee is a point raised by the National Union of Students about different complaint procedures in the HE and FE sectors. Given that further education colleges will validate their own higher education courses, it is clearly necessary to ensure that those procedures are compatible, and that FE colleges have enough resources to deliver higher education qualifications in a way similar to the way in which they would be delivered by HE colleges.

The Local Government Association is concerned about the need to protect local learning partnerships. Perhaps that could be considered in Committee as well. The hon. Member for Northampton, South (Mr. Binley) made an important point about the need to involve small and medium-sized enterprises in the planning and delivery of foundation degrees. SMEs often interact through local partnerships. It is important for them to be not just protected, but encouraged and properly resourced.

Mr. Stewart Jackson: The hon. Lady seems to be on the same tack as her hon. Friend the hon. Member for Sheffield, Hillsborough (Ms Smith)—broadly supporting the Bill, but with many caveats. May I return her briefly to the issue of intervention in respect of principals of FE colleges? The Secretary of State said that he could not recollect an occasion on which there was an intervention to remove a principal. The hon. Lady is commending powers to be conferred on learning and skills councils that have never been exercised even by the Secretary of State. That is very speculative, and I think we need to discuss it further.

Dr. Blackman-Woods: I said that I wanted the Minister to say whether that provision would contravene employment law.

Although I have asked for clarification of some points, I am happy to support the Bill. I think that the Government should be congratulated on a Bill that will help us to meet the skills requirements of the coming decades. It may be only a step towards implementing the Leitch review, but it is an important step that we
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should recognise and support. We need more people to be skilled at a higher level so that we have a work force that is equipped to compete in a global economy, and I think that the Bill will help us to ensure that that happens.

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