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I am pleased that my constituency has one of the finest further education colleges in the country: Peterborough regional college. It has 15,000 students, and the adult learning inspectorate of Ofsted has consistently rated it as an outstanding example of a further education college, especially in financial management, for which it has achieved a grade 1. The situation in Peterborough is a microcosm of that throughout the country. The Secretary of State has told us that by about 2020 the number of unskilled jobs will decrease from 3.5 million to 500,000. However, we have a skills crisis now. In 2001, youth unemployment in Peterborough was 8 per cent., but it is now 14.1 per cent. We have 760 young people between the ages of 18 and 24 who are not in employment, education or
training. That figure dates from January 2006 and I believe that the new figures will be published next month.
Peterborough faces the problem that because it is a regional centre for horticulture, agriculture and food processing and packaging, we have been a magnet since May 2004 for unskilled migrant workers from the accession 8 countries in particular. That has clearly had an impact on youth unemployment and the low-skill, low-wage end of the employment sector, hence the increase in the number of young people claiming jobseeker’s allowance.
At the same time, we are a sustainable growth area. Peterborough city council area is officially registered by the Office for National Statistics as one of the fastest growing economic areas in England. The Government must examine seriously our growing problem of NEETs—people not engaged in employment, education or training—because we must not entrench an underclass of people who feel that they have no way of getting on the ladder to a better life through jobs, skills or courses. The hon. Member for Sheffield, Hillsborough spoke movingly about people who perhaps consider that it is not their place to be in education. There are working people who think that it is for someone else to have a good education and to improve their lives and those of their families.
In some respects, the situation is grim. A third of the work force still have no basic school-leaving qualifications. As my hon. Friend the Member for Northampton, South said, one in six people have the literacy skills of an 11-year-old. Five million adults in our country have no academic qualifications at all, which is a serious problem. I am afraid that I am not as willing as others to agree with the rosy hue of how well things are going that has been suggested in the debate.
As I said earlier to my hon. Friend the Member for South Holland and The Deepings (Mr. Hayes), the Government have form on grandiose promises and plans on skills, training and enterprise. The Chancellor—the no-spin Prime Minister elect—gave an undertaking that everyone on jobseeker’s allowance would have their skills assessed and would attend a mandatory skills course, yet that never happened. On Budget day in 2005, he gave the promise:
“I have set aside funds to ensure that by 2006 we meet our target that every school pupil has enterprise education.”—[ Official Report, 16 March 2005; Vol. 432, c. 263.]
The Minister for Schools confirmed on 6 November 2006 that that had not happened.
The Bill is not all bad. We are inclined to support its aspects that will award more independence and autonomy to the FE sector, and we might well do so in Committee. Where it gives employers a greater role in driving a demand-led—not a supply-led, top-down—skills agenda, we will support it. However, I fear that the Bill overemphasises and focuses too much on structures and controls. As my hon. Friends have said, with NEETs up by 29 per cent. since 2001 to 1.24 million, that is a significant problem. We should focus instead on practical solutions.
The Bill represents the fourth reorganisation in five years, as has been pointed out. I declare an interest, as I was an Investors in People manager in a previous life and I worked closely with small and medium-sized
enterprises. The contractual arrangements made between a learning and skills council, Business Link, employers and trainees was tortuous at local level. I can assure the House that it would be punishing in the extreme at regional level.
We still have 17 bodies overseeing the FE sector. As my hon. Friend the Member for Rugby and Kenilworth (Jeremy Wright) said, 70 per cent. of the work force in 2020 have already finished their statutory education. He makes a pertinent point about adult education. A year or so ago, many of us had constituents writing to us about cuts in adult education and the hike in fees that priced many people out of adult education. Whether it was basket weaving, painting or foreign languages, it may not be important within the great global skills agenda, but it was very important to those individuals. The Minister listened to us and I commend him for it. He called a meeting and spoke to hon. Members individually to try to alleviate their concerns.
We should not lose sight of the fact that older people have a right to education as well. We need constantly to consider training and upskilling during work. As an Investors in People manager, I was well aware that for the best employers, the No. 1 issue was not necessarily the bottom line, profit or machinery. It was the power of their people to deliver brilliant results. We should never forget that. It is the reason we are a successful economy.
I lived through the last reorganisation of the training and enterprise council in south-west London. I worked for AZTEC. In that reorganisation, unfortunately, the worst TECs were the ones that were considered the templates. The Government looked at them, assessed them as poor—in that case, I believe, it was the South Thames TEC—assumed that all TECs were like that, closed them all and converted them into learning and skills councils.
The idea that 10 regional learning and skills councils will save money is naive and ridiculous, not to put too fine a point on it. What about redundancy payments? What about office costs, badges, name plaques, job reconfiguration, and consultants, who are ever-present? We know that the current spend on administration alone in LSCs is £1.8 billion. I remain to be convinced that any significant funding will be released as a result of the Government’s regional agenda. It is a recipe for bureaucracy, a lack of accountability and obfuscation, which will impact on businesses and their work forces as they see a disconnect between the local employment market and its priorities, and the regional priorities, which are currently articulated by the regional development agencies.
As I pointed out to the Secretary of State, a priority in Hull is entirely different from a priority in Barnsley, Dewsbury, Skipton or York, and that is just in one region. Local is best. Ministers seem confused about whether to regulate or deregulate in the Bill. They seem unwilling, as my hon. Friends observed, to trust the management of FE colleges.
In respect of clauses 13 to 18, I do not believe that there will be true accountability to the taxpayer, student or employee in respect of substituting the Learning and Skills Council for the Secretary of State. The hon. Member for Sheffield, Hillsborough made a fluent and eloquent speech, but she was unable to square the circle
when directly challenged on that point and about dissolving, incorporating and merging colleges and removing college principals and senior staff.
We must also focus on improving and strengthening local economies and have regard to local authorities. Ultimately, learning and skills councils do not have the same level of accountability as the Minister on the Treasury Bench; they are unelected, faceless and unaccountable. The Bill fails to mention the 148 local area partnerships, which I believe need a statutory footing. There is no requirement in exercising powers under clauses 14 to 16 to consult local authorities about the opening, merging or closing of colleges. I do not think that that is acceptable.
Other hon. Members have spoken about the ramifications of clause 17. I believe that the proposal is ill thought out, hasty and confusing. Despite the evidence drawn to our attention by my hon. Friend the Member for Reading, East (Mr. Wilson), the provision fails to recognise the success or otherwise of foundation degrees awarded by FE colleges. It has the potential to undermine the powerful and pervasive influence of the UK brand in further and higher education, which has been mentioned by a number of hon. Members. Contrary to what the hon. Member for Sheffield, Hillsborough said, it removes the focus from the raison d’être of further education and what employers want—vocational training at levels 1, 2 and 3, rather than at level 4 and upwards.
Finally, the sector skills councils sadly have less influence than they need to have to exert leverage and use enlightened self-interest for the benefit of the work force for the long term. Sector skills agreements need to be placed on a statutory basis. The Government could have been so much more ambitious in the proposals. They could have looked at local arrangements to give apprenticeships in housing associations, local authorities and NHS trusts. They could have brought best practice from all those areas into the Bill and assisted that process.
The Bill needed to focus on light-touch regulation, innovation, local expertise and accountability, a demand-led strategy and a serious recognition that economic exclusion resulting from the current skills crisis is getting worse, not better. Instead, it focuses on structures and command and control. That is why I shall support the amendment in the name of Her Majesty’s Opposition.
8.58 pm
Gordon Banks (Ochil and South Perthshire) (Lab): I am grateful to have the opportunity to contribute, and to follow the hon. Member for Peterborough (Mr. Jackson), who I am sure will not be too disappointed if I do not agree with everything that he said.
I should like to bring to the House my personal experiences both in industry and the further education sector. For 20 years before coming to the House, I ran my own business. During that time, I spent a number of years on the board of management of my local college, which has now merged with Falkirk college to form Forth Valley college. My hon. Friend the Member for Sheffield, Hillsborough (Ms Smith) spoke about engaging employers, which I believe is vital. I was disappointed when I was a further education student at
the age of 19, as I was five or six years ago on the board of management, with the role of employers.
The hon. Members for Havant (Mr. Willetts) and for Daventry (Mr. Boswell) talked about the diplomas for 14 to 19-year-olds. Diplomas can assist in achieving the aims and objectives of the Bill in addressing the skills shortage. The role of FE in delivering the diplomas is fundamental to student progression into full-time FE foundation degrees and then into additional higher education or employment. It is vital to highlight the importance of FE colleges’ vital partnership with schools, universities and employers. If we fail to get all the links in the chain right, we fail full stop.
I want to repeat a plea that has been made tonight about adult learning. I had experience of FE when I was 18 or 19; I also had experience when I was 46 or 47, and my later experiences were much more positive than my earlier ones. In order to strengthen the qualifications and the experience that FE can give, we need to make more demands and create more opportunities for employers to enter the system. When I was 19, I was busy as an assistant planner working on the development of a multi-storey shopping complex and parking facility in Stirling. I was going to the Glasgow College of Building, where what I was being taught bore no resemblance to what I was seeing on the other four days of the week. I gained nothing from that period other than a qualification. We need qualifications that students can put into practice day in, day out, whether on day release or in full-time education. They must be relevant and practical.
I do not mean to be over-critical of an establishment in the 1970s, but at that point the thought of employers being engaged in the system did not exist. We want employers to be engaged now, but we cannot expect them always to put up their hands and say that they want to be involved. We have to ask them and, in some cases, demand that they become involved. No further education college has come to ask what skills my business needs to grow and to develop, and to see whether relevant courses are available in the college.
The hon. Member for Northampton, South (Mr. Binley) referred to SMEs, which are important. We have heard a lot tonight about how larger plcs can make a contribution, but many regions do not have large plcs and are driven by SMEs. They are the backbone of the economy up and down the UK. We must be imaginative in expressing the need for SMEs to become involved and we must make them understand that they can benefit from their involvement, that there will not necessarily be a financial or a time cost, and that there will be a benefit to them and their sector if they become involved. Possibly we need to make even greater demands.
We also need to think about the additional skills that we need. As an employer, I need someone with the skills to do the job, but I also need communication skills, punctuality, presentation and interaction, which are fundamental to delivering skills learned through further education or higher education.
Earlier today, I asked the Secretary of State to clarify accessibility around FE colleges delivering foundation degrees. Many areas have access to FE colleges but do not have access to higher education facilities. The
availability of FE colleges to deliver such courses addresses a social aspect of education and training policy, something of which Government Members can be proud.
I ask the House to consider why we need these changes. The world and the economy are changing. We know about the huge economic growth in India and China, which is impinging on many countries. Low-skill and low-cost jobs have been eroded—frankly, UK plc should not want to be a low-skill, low-cost employer again. As the world changes, so do the things that the UK and individuals need to do. Individuals must recognise that they have a role and responsibility, too. We cannot stand still. The Bill recognises the ever-changing situation in the economic environment. It is an important piece in the jigsaw, and it will allow the UK and individuals to benefit from improvement in learning.
9.7 pm
Adam Afriyie (Windsor) (Con): The Bill should be welcomed with one hand and rejected with the other. I sense the agile mind and nimble figures of Lord Adonis. He has certainly done some reasonably good work on secondary education in terms of city academies. That has been welcomed by many Conservative Members, although I am not sure how many Labour Members welcome those measures. We must view the face of the Bill with a degree of caution and perhaps with a degree of suspicion as to what the ultimate motive may be.
David Taylor (North-West Leicestershire) (Lab/Co-op): Is the expansion in the number of city academies valued more highly on the Conservative Benches than the retention of town grammar schools?
Adam Afriyie: I welcome that intervention, which highlights the unity on this side of the House with regard to welcoming city academies. Over the next few years, city academies will provide benefits in terms of social mobility, which the current Government have stamped down on.
I thank the hon. Member for Ochil and South Perthshire (Gordon Banks) for raising the issue that the requirements of business are slightly different from those of universities. I also enjoyed the speech by my hon. Friend the Member for Northampton, South (Mr. Binley), who made an energetic, enthusiastic and emphatic endorsement of the need for small and medium-sized enterprises to be involved in the definition or design of further education courses. One of the themes running through hon. Members’ contributions has been the provision of information that enables students, employers and colleges and other further education institutions to see clearly what is going on in the job market and with demand for courses. The Bill is a bit of a missed opportunity in several ways.
Further education has been improving over the past few years, at least since 1992 when many organisations were released to a certain extent to do things in their own way. However, there are some concerns about what has been going on, and I should like to raise a couple as a backdrop to my comments. If this is the fourth restructuring of the Learning and Skills Council and
the further education sector in four or five years, something must have been wrong with the earlier reforms. That is why we must scrutinise these changes carefully in Committee. For example, clause 15 abolishes the role of committees of young people. Can the Minister explain how those committees have failed? He may say that they did not fail but were surpassed or usurped by something new. If so, why does the Bill not specify what will replace them? The Learning and Skills Council has had a £15 million cost against it for redundancies, with about 1,300 staff being laid off. That excludes the cost of tribunals, consultancy, advice on outplacements, early retirement and several other factors. It is therefore rather bizarre that we are talking about another restructuring.
Clause 4 does not specify which bodies will be able to formulate strategy. It mentions the Greater London authority and the Mayor of London but does not designate who the Secretary of State will empower to make strategy on behalf of further education. Given previous legislation involving the nimble fingers of Lord Adonis, I suspect that a lot might be hidden in the clause. Why is it necessary to confer a power without telling us on whom it is being conferred? That is an odd situation. I am sure that Labour Members will be concerned in view of their worries about city academies, which I suspect that they did not envisage were being created in the previous legislation.
Another big question is whether the Bill enables the Government to redirect money into city academies. As the bodies have not been defined and the precise definition of “further education” is not completely clear, surely it would be possible to direct funds to city academies—perhaps even to enable new ones to be created. I am not against that, but I am curious to know whether the Bill is intended partly to open up these definitions. The Minister is shaking his head; I look forward to his comments when he winds up. I ask the question because the number of city academies is set to increase from 80 to 200, 300 or 400 over the next few years.
If, under clause 21, all principals must be qualified to be in charge of a further education institution, that prompts the question of what qualifications they will need. In a freely operating market, where innovation is needed, straitjacketing people into a single sort of qualification to hold a post of leadership does not lead to the variety and differences that enable the development of better practices. I would be interested to hear a few words about the reason for clause 21’s insistence on what appears to be—until the regulations are published, we will not know—a specific sort of qualification for a principal of a further education institution.
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