UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 333-vi

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

EDUCATION AND SKILLS COMMITTEE

 

 

POST-16 SKILLS TRAINING

 

 

Monday 21 May 2007

MR CHRIS HUMPHRIES CBE, MS ISABEL SUTCLIFFE, MR GREG WATSON,

MR JOHN McNAMARA and MR ALAN STEVENSON OBE

Evidence heard in Public Questions 557 - 637

 

 

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Oral Evidence

Taken before the Education and Skills Committee

on Monday 21 May 2007

Members present

Mr Barry Sheerman, in the Chair

Mr Douglas Carswell

Jeff Ennis

Paul Holmes

Fiona Mactaggart

Mr Gordon Marsden

Stephen Williams

________________

Memoranda submitted by City and Guilds, Edexcel, Federation of Awarding Bodies and OCR

 

Examination of Witnesses

Witnesses: Mr Chris Humphries CBE, Chief Executive, City and Guilds, Ms Isabel Sutcliffe, Director of Qualifications and Accreditation, Edexcel, Mr Greg Watson, Chief Executive, OCR, Mr John McNamara, Chief Executive, British Institute of Innkeeping and Mr Alan Stevenson OBE, President, Food and Drink Qualifications, gave evidence.

Q557 Chairman: Can I welcome Chris Humphries, Greg Watson, Isabel Sutcliffe, John McNamara and Alan Stevenson. We decided to put you all in together because we were going to divide you into two but the whole pace of the thing, when you have to get two sets of witnesses, does rather affect the quality of the way the thing builds organically over the couple of hours that we have you in front of us. The one thing I am going to ask you to be careful of, please do not each try and come in on every question. Some of my colleagues will try to make you but I will try and stop them. Here we are, we have some of the best known people in the skills world here. You have all got a tremendous history in the skills world, in other words you know where an awful lot of bodies are buried, we will probably try and disinter some of them today. I do want us to get a little bit of a feel of where we have come from rather than just where we are at the moment, if that helps us. I want to run right across from Chris through to Alan and give you each two minutes to say, "Okay, here we are". The reason that we are holding a major inquiry into skills, not only because this Committee is pretty obsessed about skills, and quite rightly so, we always feel that skills are the neglected part of the Department. Of course, when we do do skills the media are never here. Any media here today? Not one person. Whenever we do skills they are not here and yet everyone tells us that skills are of paramount importance to our country. Without further ado, what we are trying to get out of this then is okay, where are we? Here are two parts of Leitch, here is Foster. There has been a great deal of comment/discussion. The Treasury has been involved, the Department for Education & Skills of course has been involved, the Prime Minister is interested in skills, right across the piece skills are in focus. That is why we are doing it now, this is why we are doing our inquiry. Pull all these threads together. So where are we now, Chris, are we in a good position?

Mr Humphries: I think we are sitting on a potentially good foundation but there are some major issues still to be resolved around adult post-16 skills. I think some of the debates which are going on, both here and elsewhere in the system at the moment, are ticking along that. Let me try to address them. Let me pick out a few. Heterogeneity of employer demand will be my first issue. What we know from years of working for employers is that the needs of employers, large and small, even within the same sector are amazingly diverse, depending on the nature of the business, the focus within the industry, the specialisations that they follow, the niche markets that they pursue in order to be competitive against their neighbours. All of those create a remarkably heterogeneous employer base where the need for skills have many common characteristics but the differences in skills requirements are just as great. I think if you are asking me what is one of the big issues, it is the extent to which we are properly responding to that heterogeneity of demand. There is a strong concern in many places that both the amount of work and the scale of current activity of the Sector Skills Councils is going to lead to them addressing a homogeneous set of solutions because the scale of the task otherwise becomes too huge. If that happens we will end up meeting SSC expectations and requirements not employer needs. My first one would be how do we make sure the system really responds with the heterogeneity of requirements. The second one is responsiveness. There have been many comments over the years about the extent to which we are fast enough or not fast enough in keeping pace with change in industry and the extent to which our system is capable of producing new qualifications, variations, updating programmes, flexibility in provision and the concern from employers about how long it often takes to bring things into the market place. My second concern - there are lots of reasons we can explore later for why it might happen - is that I think we are in grave danger of increasing bureaucracy and inflexibility in the system rather than eliminating it, and I think that is the second issue.

Q558 Chairman: That is not a bad starter.

Mr Humphries: One more if I can mention, to pick up your too many qualifications questions in this. I do not know the extent to which the Select Committee is going to be talking directly to employers, not employer organisations or employer representatives but employers who train. My experience of dealing with employers in almost all the sectors that are going suggests that actually they know what qualifications are in the market place, they know the ones which are right for them. They typically only deal with half a dozen different awarding bodies or skills organisations and they know the ones which are right. Richard Wilson of the Institute of Directors did a major study of employers to find out whether they thought there were too many and actually they thought there were not. There are 55,000 different degree programmes UCAS announced in December of this year but we do not think there are too many of those. I think there is a misunderstanding about what is happening in the vocational qualification sector, the skills sector, about demand and responsiveness. Employers know what is out there and will choose the things they need.

Q559 Chairman: Right, you reminded me as you spoke, Chris, that I should have declared an interest. I am a City and Guilds fellow, am I not?

Mr Humphries: You are indeed.

Q560 Chairman: Greg Watson, what is your take on where we are now?

Mr Watson: I think it was interesting, your introduction, you talked about seeing a bit of history in this situation and it certainly strikes me that we are standing in front of something of a watershed around skills and particularly around qualifications. If we look from the early 1990s up to today I think we can see a paradox emerging. On the one hand, there have been growing attempts since the creation of NVQs, right through the 1990s, through to the creation of the National Qualifications Framework to create a formal process driven architecture to bring the right skills and the right qualifications to individuals. With it we have seen the creation of the bureaucracy that Chris has touched on in the form of a growing number of public bodies which are involved in the supply chain. On the other hand, over that same period, I think we have seen a growing diversity in what employers need by way of skills, in the kinds of businesses that employers are involved in and, particularly in the early part of this century, we are beginning to feel the dramatic impact of things like globalisation, e.commerce, mergers and acquisitions which are bringing companies together from formerly disparate sectors to be parts of single enterprises. It seems to me if you put those two trends together, on the one hand these growing and regularly failed attempts to try and create a formal architecture and set that against the greater diversity and the more rapid rate of economic change that we have a mismatch here. I think Leitch and the work we are all doing on another form of qualifications framework really begs the question as to whether we go further in that same direction and attempt once and for all to capture this formal bureaucratised process for getting it right or whether actually this is the point that we admit defeat on that as a method and instead seek to find other ways to stimulate the sort of innovation and responsiveness that gave us a lot of the vocational qualifications which are still most of the popular qualifications to date, most of which date back to the 1970s and 1980s.

Q561 Chairman: Thanks for that. Isabel, do people not feel there is a tremendous vested interest in your sector because you are a private sector - many of you are private sector now - you are very profitable organisations and the more qualifications you keep going the better. Is that an unfair comment?

Ms Sutcliffe: A touch unfair, Chairman, if I may. As with my colleagues sitting to my right and left, we need to keep investing into the technology that is required to enable the users of our qualifications to maximise the opportunities those qualifications provide in terms of alternative approaches to learning. Edexcel, being part of Pearson, of course we have got a wonderful opportunity of tapping in to what is happening elsewhere in the world and actually learning from that and bringing that to the benefit of our learners. If I may, certainly I would fully endorse what my colleagues to the right have already said. Could I add two points, which perhaps have not been covered thus far. First of all, whilst there is a lot in Leitch to admire and support, not least actually bringing skills very, very high profile, I think we have got to be mindful of a very economic way of looking at the issue. We are talking about individuals at the end of the day, the learners themselves, be they employees, be they potentially aspiring employees and, as some of the research carried out by IPPR showed, for example, unless you try and focus on what is it that is going to motivate the individual to get fully engaged in learning then it does not matter what we throw through employers it is still not going to have the desired effect. NIACE's report just last week suggested 500,000 adult learners who might have been in the system this year who are no longer there because of the diversion of funding, and I fully understand the reasons for that. Let us keep in mind the individual and the needs of that individual in terms of moving forward and it satisfies all of those issues of social justice and so on and so forth. I think the other point I just want to make is this thing with the emphasis being put on the qualifications system. The qualification framework we have, I put it alongside, if you like, a food chain and we, as awarding bodies, and our qualifications are at the end of a very, very long chain, and yet it seems to be the part of the chain that is always the one that is looked at first. I think most metaphors would suggest you do not start at the end of a food chain when you are trying to bring about significant and sustainable change going forward, it is earlier in the food chain that you start to look and I know that is obviously part of your inquiry.

Q562 Chairman: John, how do you view it? You have a rather specific view on this? Where do you think we are in terms of where you come from?

Mr McNamara: Thank you, Chairman. Obviously I represent a professional body which is a discrete sector and very focused on the business success of that sector. We have got about 30,000 members, so mainly small businesses, small and micro businesses, from six to 12 employees, that is the standard remit that we would cover. I think we are at a very interesting stage in development because we are now starting to see, as far as our sector is concerned, some of the detailed issues of Leitch and we would all applaud the need to get employers' views in terms of the skills debate to the fore, all of us would support that and endorse that. I speak for a sector that, to be honest, at the moment has no funding for its qualifications. The sorts of qualifications that we provide are fit for purpose but they are not fundable. Many of our employers will be looking at this debate and thinking "Well, where is the beef for me? Where will it affect me? Where will it impact for me? Where will these reforms change the way I am doing things? Where will it improve my business?" Those are key issues for all of us to face. As a professional body we face those and discuss those every single day of the week. I have genuine concerns that if we are not careful at this crossroads, if we go down the wrong route on some of these key points, we could end up very seriously behind where we were ten years ago even. Certainly as a sector we hope and expect a lot from these reforms for small businesses. Part of my job is to make sure we get the benefit from the reforms as well as communicating those effectively to our members.

Q563 Chairman: Are the people sitting to the right of you helpful in this process or are they a barrier?

Mr McNamara: They are colleagues of ours in many cases in producing qualifications into our sector and outside but at times we compete, at times we do not compete because we are members of trade associations which come together and represent common views. I suppose all I am saying is from a particular sectoral point of view the role of SSEs in our sector has been, to a certain extent, mixed and variable. We get on and we have dialogue with a number of SSEs and sector skills bodies which are very, very effective, in other cases not so effective because the existing structures and networks that we have, we are very, very close to employers. Those structures and system have not been used, I do not think, to the full yet to help drive this agenda forward, and we certainly intend to work on that.

Q564 Chairman: Alan, you are one of the people who John works closely with, are you not?

Mr Stevenson: Yes. Our interest is mainly food and specifically meat. The industry is made up of a lot of small and medium sized enterprises. The bulk of the training within the industry takes place in the larger organisations. The availability of funding and the bureaucracy associated with getting a training system on board discourages a fair number of employers. Increasingly the food industry and also the meat industry are relying on non British workers. There is an increasing concern and worry that we are unable to find British nationals who are able to come into an industry where I suppose the conditions of working are somewhat difficult, whenever they can sit in a much more pleasant environment, but we are at a watershed and the industry is going to have to tackle this. Therefore, we are most anxious to make best use of train to gain and the other opportunities which are available within an industry which is under considerable competitive pressures, mainly from the major multiples.

Chairman: Right, I think that has warmed us up and you up. Let us get started on particular sectors. Fiona?

Q565 Fiona Mactaggart: I was very interested in something which I heard I thought from a number of you. I think I was hearing that the Sector Skills Councils are not really in touch with employers, I might be over-stating what some of you only hinted at but I would like you to flesh that out. Chris, certainly you were one of those who said you felt that. I want you to flesh that out and tell us what the consequences of that are?

Mr Humphries: I did not quite say that but I certainly implied that there was a big issue about their responsiveness.

Q566 Fiona Mactaggart: Yes.

Mr Humphries: I am not trying to draw a silly line here. The problem for many of the Sector Skills Councils is they have a huge footprint, it is called a huge remit. They cover a large number of sectors. In hospitality, for instance, they cover 14 distinct sub-sectors. They have limited resources, a relatively small staff given the scale of the job and the likelihood that they would be in a position to completely understand the full skills requirements of every industry in that sector, every employer in each of those 14 sub-sectors, and be able to determine in a timeframe which is responsive to the needs of those employers every single one of their skills needs is a misunderstanding of what is possible. My concern is not so much that they are not in touch with employers, it will vary enormously from Sector Skills Council to Sector Skills Council but whether the job they are being given in relation to qualifications is do-able. Fourteen sub-sectors, probably in that sector something like 120 different occupations, usually at two or three levels of the qualification framework, that is about 250 to 300 separate qualifications they would have to review in three years. Are they equipped to be able to do that in terms of occupational standards and at the same time build enough flexibility and customisation into each and every product in order to produce those responses in time, it raises for me the question of whether it is do-able. However much effort they put into talking to their employers, the idea that they could cope with all half a million, one million employers in the sector and meet the heterogeneity of their requirements is my concern. I am not sure it is a do-able job if they are going to get into the detail of qualification development, no matter how hard they try.

Q567 Fiona Mactaggart: John, you were another person who I interpreted as saying the same thing.

Mr McNamara: Yes. I think I can summarise it by saying it is good in parts. We deal with three sector skills bodies, one SSB sector skills body and two Sector Skills Councils. In two of those cases we work very closely with them, we collaborate. We obviously have a very extensive network of membership and we also provide qualifications into the sector. We work extremely close to employers. We do not design qualifications on the basis that they might work or they might not, we test drive them, we fly them first and see if they work and then we deliver them if they do. In two cases we work very closely with those bodies to try and represent employer needs from our sector, our specific sub-sector to those bodies; in other cases it is not so effective. I suppose one of our comments as a professional body is, use the networks that are available to Sector Skills Councils and similar groups which already exist. We are already in close contact with employers at many levels. We have been in business for over 26 years now. Those structures exist, they are there, let us use them. I do not think that has been going on to a large extent.

Q568 Fiona Mactaggart: The reason I was asking about this is because it seems to me that there is a theme going on about the bureaucracy that I have heard from a number of people and that bureaucracy was established, it seems to me, in an attempt to simplify a kind of terrain where it was not necessarily easy to know who to relate to, so creating Sector Skills Councils was an attempt to simplify the system. What I think I am hearing is - it is a bit like what Chris says about let a thousand qualifications bloom, don't worry about it - I am wondering if what you are saying is that attempt to rationalise and simplify the communications terrain has been flawed and is not working and has created an unnecessary bureaucracy whereas just leaving it to people to do on their own would have worked better?

Mr Watson: It is easy to see in conception how this model does what you are talking about and somehow shepherds needs into manageable pieces but it does depend an awful lot then on getting the right model of the economy at any given moment. It is interesting, I was just looking back at the list of the current Sector Skills Councils and I cannot currently find one for business enterprise, customer service, marketing, sales, international trade, languages, purchasing and supply, recruitment and personnel. Those are very large developments in the economy, areas which are carrying growing weight but they do not tend to sit within what we would recognise as established industrial product based sectors. I think part of the problem is that the very constitution of the Sector Skills Councils tends to force a lot of analysis on to product based industries and tends to neglect the over-arching skills trends within the economy. I think sometimes it seems responsive, I think it is a question of looking at the wrong question sometimes.

Q569 Fiona Mactaggart: Isabel?

Ms Sutcliffe: I think too if I could just pick up, Chris in his response queried whether the role given to Sector Skills Councils in terms of crafting qualification strategies going forward is do-able. I think the bigger question is really is that an appropriate role to give to Sector Skills Councils. Surely we are in an issue of trying to encourage demand for training, upscaling and so on and it is recognised, is it not, that whilst the bigger employers might be doing lots of this we are not seeing the demand coming from great swathes of employers. It strikes most of us they have an enormous remit of responsibility and taking on board qualification, reform, design and so on, we would humbly suggest is probably not the best use of resources targeted to try and get the demand coming from training. You asked about the consequences of those SSCs where they do not seem to get that level of engagement, and I will come back to that in a moment. If I could just say obviously, as awarding bodies, we work across all 25 of them so the inconsistency is very much something we are having to work with, work around, do our level best because there is no such thing as a standard SSC awarding body working relationship, not at all. The consequences of them not managing that high level of employer engagement is, of course, we all find our way around it so employers, as has been suggested already, work directly with us. There will be no question of an employer, for example, seeking permission from its SSC to enter a dialogue directly with an awarding body who was able to give, at the right price, in the right timeframe, something which met that employers needs. That has been happening for decades and will continue to work in the future, I would suggest, because that is the way somebody who is purchasing the product is going to get what they want, at the price they want it and in the timescale that is appropriate.

Q570 Fiona Mactaggart: Were not SSCs set up, to some degree, to deal with the frustration from the employers that you were talking about, that their needs and concerns were not properly reflected in the design and development of courses?

Mr Humphries: Yet the consequence is that we are getting more homogeneity in qualifications as a result of it. OCI gave an example in their submission, there is only one IT qualification now allowed to be offered in the market place, the only problem is no-one is taking it. The second issue is you do get bureaucracy. I brought along, which I am happy to leave with the Committee, the qualification endorsement process, just initially issued by Cogent, the Sector Skills Council. It is more bureaucratic than anything we have ever had in the past and this is to happen before it goes to QCA for regulatory approval. We have suddenly seen a system that is more uniform, more homogenous, gives less choice to employers associated with more bureaucracy than we have ever seen before. In my view, it is a consequence of organisations who City and Guilds supported - I recommended the establishment of Sector Skills Councils in the Skills Task Report in 2000 - taking on things which I think are simply beyond their capacity and far from doing that sort of over-arching, long-term view of the future, they are seeking to get into the detail of day to day organisation and operation of the sector which actually risks creating a less responsive system to employers rather than more responsive one.

Q571 Fiona Mactaggart: I want to hear from the employers, Alan?

Mr Stevenson: As far as FDQ are concerned, I think it is fair to say that the jury is still out. We believe that a considerable amount of time has been lost. Advice given at the time, whenever it was formed, was not always taken and, 12 months down the line they have come back and said "Perhaps you were right" or maybe they have not even said we were right. The major experience within the food industry is with the trade associations and that advice initially was not used. I think the industry, as a generalisation, at this moment in time, are not quite certain what the Food and Drink Sector Skills Council is actually doing. I do not think that they are fully listening - certainly from the meat side of the business. The meat industry had a very well-established set of qualifications and they are being played around with, which is confusing, and employers are not quite certain just which way they should be going, whether they should be trying to do their own training rather than going for more structured training.

Q572 Fiona Mactaggart: I am thinking about this set of answers because I think what I am partly hearing is that traditional vocational qualifications have been messed about with a bit and that the relationships which buttressed them have been interrupted and that, I think I am hearing, has not been a good thing. Now, I want to squeeze two questions into the last question which the Chairman has invited me to ask. Are there any good things from this new structure, that is question number one? Question number two, one of the reasons it tried to be created was to encourage qualifications in those fields where there have not traditionally been qualifications. Alan, you have talked about how you are employing people from overseas and so on. One of the things I am struck by is that in meat there has been a tradition of qualification but in various other food areas there has not. I am just wondering, are there areas where we have not got a sufficiently robust tradition of qualifications, not just that overseas people are prepared to work in these sectors but actually they have a tradition of qualifications in other countries and, therefore, people come with appropriate qualifications in, for example, hotel and catering and things like that where we have very little tradition of qualifications. Are there areas where there is a gap and we should be doing it, retail, I do not know, is one example, aspects of hotel work and so on? Two questions: have there been any benefits from the new structure and are there areas where we are lacking on qualifications where we need them?

Mr Humphries: I think there are some good things in the new structure. I have never been a random SSC basher. As I said, I have supported their establishment from day one and continue to support the need for effective bodies working in sectors that seek to understand the larger picture of the long-term needs of industry, help make those explicit and to do it in such a way that also acts as a spur to SMEs to participate in training. I think that aspect of the remit of SSCs is one I strongly support. It is the level of the detail where I start to worry. In terms of qulaificatons where there are not any, yes there are some good examples. I pick Skillset, the Film and Television industry Sector Skills Council is one which is starting to create a demand for and an interest in transportable mobile qualifications in the sector where most of the training has been ad hoc and has achieved the success of buying into the sort of levy that will fund that as well. I would never say it is all bad, I think it is the point at which they get down into the detail rather than up at the business strategy and sector strategy level that simply the capacity gets overwhelmed.

Q573 Chairman: They have got a mission creep have they, John?

Mr McNamara: I think that is a good way of looking at it, Chairman, on the basis that we all supported the setting up of SSCs from the perspective of a strategic look at each sector and there are some shining examples of sector skills bodies or SSCs which have just done that. They have looked at a sector, Skills for Security is a good example, an SSB has looked at that sector, traditional low value in the past, now heavily regulated. They have stood up for their sector, they have represented it well. They have done enormous amounts of work in terms of building a picture of that sector in terms of management information and profiling its worth. They have used existing networks. They have got to grips with the real nitty gritty of what is going on, on the ground, close to employers and to professional associations that work with it, a good example of where it works very, very well. I have to say across the board of SSCs I think there has been a mission creep, I think part of that is driven by lack of funding and it is the strive to survive syndrome. We need funding, we need to be here in three years' time where is that money going to come from. Some of that is Government sponsored, obviously, but we have got examples of SSEs that have done bits of research and have got grant funds to stay in existence and that cannot be good strategically for the long-term role of those sectors and I think that is a cause for concern.

Q574 Chairman: Good.

Mr Watson: I might draw a distinction in trying to answer this question between qualifications which are a strict licence to practice of some sort and other qualifications which are for a much more general contribution to the economy. At the licence to practice end we might find some very good examples of success actually. Look at areas like construction or hairdressing, for example, the sort of industry where either you can or cannot do it and there is a fairly hard line between the two. If you cannot do it people get hurt, people's health is damaged, safety is jeopardised, those kinds of things. I pull out a number of good examples where that has worked rather well. Contrast that with an experience OCR had in 2005 where we were looking to develop a new set of qualifications around the area of enterprise. There is a lot of discussion about how to stimulate SMEs and being an SME these days is not simply a case of finding a bank account, filling out a form and getting a loan, actually there is a certain amount of compliance work to do and some basic skills that even most lenders will want someone to acquire. The reason that project failed is because we could not find a sector body to support us, not because it was not economically needed, not because we had not got a well thought through idea of what we would like but we knew that unless we could successfully navigate the bureaucracy, and part of the bureaucracy was to find an SSE to tick a box for us, those qualifications would never see the light of day. To this day that project sits on a shelf gathering dust in OCR.

Ms Sutcliffe: Could I just again endorse the examples and statements which have been said thus far. Going back to the point you said before, their history and fairly recent history has examples of qualifications that were initially designed very much with employers needs in mind and continue, despite all the to-ings and fro-ings of qualification reform, are still there and highly regarded and highly valued. If I can just use an example from my own organisation, our BTECs in the past, we always built in flexibility to enable very particular local regional needs and we have not introduced a geographical dimension as yet into the debate. I think there is something very important about having a flexible way of ensuring that a locality's needs from an employer base or wherever are met. Prior to the introduction of the National Qualification Framework in the 1990s we were able to, if you like, have empty shells attached to filled shells, if you like, of qualifications enabling that flavour to be fully represented, respond to a local employer, "That engineering BTEC national is fine but we have this particular need, can you customise it?" The NQF another example, again, of rather a blunt instrument resulting in good practice of that kind being removed and yet we are now expecting, through the current reform programme of the Qualification Credit Framework to be able to bring that back again. We have been there before and that might be one example of good practice that will be back for us to use sooner rather than later.

Q575 Chairman: To fully answer this, can you take us through the bureaucratic process that you are describing? Can you give us a little bit more feel for why you, Chris, have described it as a bureaucratic process.

Mr Humphries: You know the process at the moment is that Sector Skills Councils are meant to identify the National Occupational Standard, pass that to the awarding bodies, we develop the qualifications, they go to the regulator for approval. We are now seeing a requirement even to continue an existing qualification that before it can go to the regulator there has to be a 13-stage process. This particular Sector Skills Council they want a letter of intent and they have to establish a written business case to continue it and they have to do a qualification review plan. Then there has to be a regulatory consultation, and then there has to be an application form and qualification submitted. Then there is a desk review by the team. Qualification supporting documentation is then considered by the industry or regional director and that is then reviewed. Then it goes to the education and qualifications manager, they will produce a report. That then comes back to the awarding body and that is before it goes to the regulator who gets a chance to have another go at the whole qualification and can send it back to start again. In an industry where employers are looking for a process where we should be going from idea to concept in less than six months in order to be responsive to employer needs, and we already know the system is struggling to meet those timeframes - you have had reviews of the underpinning bureaucracy in the qualification process before - what I fear is we are in grave danger of creating something which is far more complex than we have ever seen before.

Q576 Chairman: You know these people, what do they say when you say, "Look, this is intolerably bureaucratic. It is not helping. It is getting in the way of what we do"?

Mr Humphries: Particularly since the Leitch Report has said SSCs should sign off every qualification, there is a belief that they have to create something which is in some way robust and related to assessed market demand. I think they would argue that this is a consequence of the remit they have been given and a need to ensure that this is tested thoroughly against good market principles. The reality is if this is a market then, to be honest with you, there is a simple solution: since people have to buy this stuff, they will not if it is no good. There is a much simpler way of testing the market with this, which is see whether people are willing to put their money where their mouth is. My organisation is a charity, and it is certainly not in my interest to pour charitable funds into something which is going to lose me more charitable funds. There is just no interest in us doing this role, so we put an awful lot of effort into talking to employers ourselves to make sure these things are the sorts of things they are willing to offer their staff or their recruits before we even put them in the marketplace. Now we are going to have two further sign-off processes, each of which is checking whether employers are going to use them, and you think, "Something must be wrong here".

Q577 Chairman: We are trying to discover when this all happened. Were the Sector Skills Councils okay and less bureaucratic until this Leith recommendation or were they moving in this direction anyway? Where did they get this power? When did they get the power to have to give this stamp of approval to qualifications before they could be publicly funded?

Mr Watson: My experience is, and this goes back to the creation of the National Qualifications Framework, as soon as you have a notion of a framework you have a notion of boxes in a framework and there is instantly a question about who has guardianship of the rules for entry to the boxes. I think that was the point at which there was a decisive shift towards industry representation.

Q578 Chairman: Give us a timeframe for this?

Mr Watson: 2001.

Q579 Chairman: Okay, because that was my other question about the NQF. SSCs came in at what date?

Mr Watson: We had NTOs back then, but it was a similar sort of idea, sector-based bodies who act as a gateway to a box in a framework.

Q580 Chairman: They came in when?

Mr McNamara: SSCs were in 2004.

Q581 Fiona MacTaggart: But there were NTOs before that?

Mr McNamara: Yes.

Q582 Chairman: When did the National Qualifications Framework come in?

Mr Watson: 2001.

Q583 Chairman: 2001?

Ms Sutcliffe: Yes, the end of the 1990s.

Q584 Chairman: How do they mesh? What was the NQF doing before Sector Skills came along?

Mr Humphries: What an awarding body had to do before then was to be able to prove to the regulator they had adequately consulted with the workforce and the employers in that sector in developing the qualification before it went to the marketplace. You have to put a business case up which says, "We have talked to the sector. Here is what we believe the demand is. Here is what our research tells us will be the demand for this qualification. Let's put it in the marketplace". What NTOs were given was an additional sign-off authority which said, first of all, they could ask for qualifications to be developed and, secondly, they could then insist on a sign-off. The sign-off in the early stages was light touch.

Mr Watson: It was good enough.

Mr Humphries: It was, "Have you done enough work to satisfy us that there are employers out there who want this? If you have, let's go with it". What we have moved into is a mode where what Leitch has said is, "No qualification can receive public funding unless it is signed-off by the Sector Skills Council through an approved process". The Sector Skills Councils are being challenged to write the Sector Qualifications Strategy which determines the shape which qualifications must take. We have added a number of additional requirements to this which will inevitably cause there to be people whose job it is to take those views. The consequence will be there will be more and more organisations involved in checking whether employers want them. The difficulty is at the same time we are seeing a narrowing of offer to the point where a qualification can only look like the form which the SSC has decided it should take, so there is also a squeezing, a narrowing down, of the focus and a reduction in choice for employers.

Q585 Chairman: These are very simple questions but we must get them before we can write a decent report. In this process, the Sector Skills Councils are here, the National Qualifications Framework is here, how do those two relate to QCA then?

Mr Humphries: The NQF, as was, which is due to be replaced by the Qualifications and Credit Framework, a new name, will have a tougher set of requirements about what can get on to it. The QCA will only be able to accredit a qualification which has been signed off in the way in which that Sector Skills Council wants it signed off, but they then have to do additional checks to see that it meets all the requirements which they lay down in terms of qualification shape, allocation of credit, combining rules for choice of units and options and electives. We are in the process of designing a system which is more complex and more constraining than anything we have had before.

Q586 Chairman: You guys and those three bodies are the main players?

Mr Humphries: The regulator, the Sector Skills Council and awarding body, yes.

Q587 Paul Holmes: Leitch and Foster argue that there should be a very significant rationalisation of the number of qualifications being offered, but the Institute of Directors said that in a modern capitalist economy it is good that there are all these different bodies offering lots and lots of different qualifications and competing to provide what employers need. I take it from your opening comments, Chris, you would agree with that?

Mr Humphries: Yes, I would.

Q588 Paul Holmes: In a capitalist economy, one of the points of competition is supposed to be to drive prices down to give the consumer a good deal, but the consumers, such as the colleges, are saying that it seems to be a licence to print money, that fees have gone up, for example, about 36 per cent in the last three years.

Mr Humphries: The first thing is I think you need to look at where they have gone up. By and large, they have not gone up anything like that level in the vocational sector, and I think I would leave it to people like Edexcel and OCR to talk about what has happened in general qualifications because I think they would argue that. I thought you might ask that question, so I did track our price rises against inflation, and you can see the two lines on the chart are roughly in line, that is what we have done for the last five years. I think it is perfectly right and reasonable, all things being equal, for the education system to expect us to keep prices in line with inflation, or slightly below it, if possible, in order to gain efficiencies and produce a benefit for the marketplace. The interesting consequence of the changes we are talking about here is that if a process becomes a lot more complex, a lot more bureaucratic and a lot more time consuming, then it will put costs up, and if costs go up, prices will go up. As I said, I will leave it to my colleagues to talk about whether that is what has happened in the general qualifications sector, but our fear is that these changes will put up costs.

Q589 Paul Holmes: City and Guilds have kept it in line with inflation, you must have put it up a lot more then to make up the 36 per cent increase, Mr Watson?

Mr Watson: I have read the full report from FE, from the Association of Colleges, which is doing the rounds at the moment. There are a few obvious causes of rising costs which the report does not pick up. One is what Chris has alluded to, which is the growing cost of our managing the bureaucracy with which we are forced to engage in bringing new qualifications to market. The second is because of the more frequent process which we were forced to go through, and reaccrediting qualifications, the management overhead associated with that is growing. We might talk in a little while about the number of qualifications and the fact that is also the result of too much churn in public policy rather than anything else. The third, and most glaring emission from that report is nobody has counted the number of qualifications that are being taken. A big driver of what is driving the total bill up in terms of total pounds spent is the number of learners going through which is growing relentlessly over time.

Q590 Paul Holmes: There are half a million less doing adult educational course than there were last year.

Mr Watson: Remember, FEs also count in the total cost of all qualifications, so that will include A levels, for which uptake is still rising, for example.

Ms Sutcliffe I am sorry, I cannot show you Edexcel prices over the last few years as City and Guilds has and Chris Humphries on their behalf. Certainly our starting point on any review of fees is very much to keep it in line with inflation. All the points which Greg has made we would endorse as well, and rather than trying to see a way of bringing efficiencies, which we, as businesses, are all about, clearly, we are all business people trying to work more effectively and more efficiently, we find ourselves increasingly subject to the vagaries of policy diktat which, as a consequence, introduces more cost.

Mr McNamara: As a professional body, obviously we reflect the needs of the sector. We have frozen prices for the last three years and, in fact, this year we have introduced a new discount scheme to try and encourage more of our employers and small businesses to take qualifications. Again, like Chris, we are a charity and we do not intend to make mega profits, but if we do not make a profit we go bust.

Mr Stevenson: In an effort to get a larger share of the market, we reduce prices.

Q591 Paul Holmes: We have held prices at inflation, we have reduced prices but costs have gone up 36 per cent purely because of Sector Skills and Government requirements or because of the increasing numbers of people who are sitting exams. Somewhere like the City of Bristol College, for example, they spent £1.5 million last year on fees, Truro £1 million, Chesterfield College in my constituency £860,000, then you could come back and say, "Bristol College is one of the biggest in the country, of course it is £1.5 million" but the principal there says, "It has gone up 30 per cent in four years". So it is not just that it is a large college and lots of people sit in it, it is a 30 per cent increase in four years, so there is something going wrong somewhere.

Mr Humphries: The interesting thing about the AOC report, and I have seen the comments from the individual principals, is that what it does not separate out is the growth. If you do not count last year, there has been a dramatic growth in the student numbers over that period. A part of that 30 per cent rise is undoubtedly the total, because the figure is how much we have spent on award fees last year. If you look at that four year period, in fact, participation in FE rose dramatically, it was only last year particularly that the LSC announced that big £700,000 fall. Until that time - that report was, of course, a 2006 report, not a 2007 report, so they were not looking at last year at all - you were measuring that at the point when there was the fastest growth in further education probably in my time in this sector. The second thing was that there were changes to general education requirements which did put up fees there, more than we desired, but I think it was trackable back to changes which were made in the nature and structure of the qualifications. From my perspective, it is an absolute legitimate inquiry which is one of the reasons why I went straight back and went, "Oh my God, what have we done?" - and we can show just over a 20 per cent rise in six years, which, as you will know, roughly tracks inflation over that period - because I was very concerned to find out the extent to which we were doing that to anyone. I think there is a genuine question here to be understood about why fees have gone up and why exam fees have gone up, and I would like to see a piece of independent work by someone who would actually understand that in terms of volume and pricing and the type of qualification. I think it is a piece of work we need to do.

Ms Sutcliffe: As a supplementary to that, I think the other recognition is that over that period there was a real shift from what might have been called "uncredited learning" to accredited learning because of the great push, started with FEFC, certainly picked up by LSC, that for courses to be eligible for funding they needed to have accredited outcomes, which clearly with progression pathways can only be a good thing, but I think, again, that has to be a component part, I would suggest, over that significant growth.

Mr Watson: I want to try and join this topic back to the original topic, which is if there is a concern that the total exams bill for the nation is too high, then consideration of how we run the qualifications system going forward is, it seems to me, a good moment to try and find ways to reduce the total cost. I hope two things have come out quite clearly already. The first is I think there is a general belief with the people sat on this table here that the bureaucracy is becoming an overhead for us which we are struggling to manage, and the only way we manage it is by employing people and people are a heavy cost for all of our organisations. The second thing is we have recently had an interesting experience with diplomas, which I know the Committee has just reported on, a heavily employer-driven enterprise. I think we got 18 months through that process before anybody started to worry about the cost, and I would argue that if cost had been one of the design constraints early in that process we would not have the diploma qualification we have today, and the cost of that somebody somewhere will have to bear for those diplomas to be rolled out. For me that is a real risk in having Sector Skills Councils playing too authoritative a role with too little understanding of the costs of delivering certain kinds of qualifications. It is the easiest thing in the world, as Sector Skills Councils have done in the past and are still doing, to publish a notion of a 20 unit qualification or a 200 unit qualification, I think you quoted once, Chris. Sitting at a desktop doing employment needs analysis, that might look like a very attractive proposition, to those of us who would have to deliver these qualifications, we would instantly recognise that a 200 unit qualification was going to bring a cost to the public purse which nobody would think was sensible.

Q592 Paul Holmes: I have three very specific questions on this cost one still before we move on and perhaps we just need, therefore, one person to answer each one. First of all, it is not strictly a skills one but it is related to what you have just said. Six years ago I was a head of sixth form and one reason why the cost of exam entries was so expensive was we moved to modularisation. The latest review is going to move it from six units to four at A levels, therefore will the fees drop by a third?

Mr Watson: Only as likely as a school cutting its roll by a third would release the overheads by a third.

Q593 Paul Holmes: So it will not, okay. Generally across the board, the exam boards have made a lot of use of new technologies, students register on-line, results go out on-line, markings are done on-line, you are using less qualified people to mark smaller chunks on-line, surely that should have brought the costs down, or are you saying the 36 per cent increase in the three years would have been even more if you had not moved into on-line marking?

Mr Watson: It is not really the topic we are on today but, in simple terms, I would say, all of the savings you talk about are real savings but they have been realised off of a pretty substantial capital investment and those technologies do not come for free. It takes a long period of piloting on relatively small volumes to get those types of technologies to work reliably. I am sure in the longer term there will be benefits to be realised there, but on a strict short-term payback basis, none of the things you have alluded to produce a net cost saving for us right now.

Q594 Paul Holmes: The QCA certainly feel there might be a problem here because they are suggesting that the fees for the new diplomas, which you have referred to that might be very expensive, there might well be a cap put on that. Are you saying you would be totally opposed to that?

Mr Watson: I would say, much as I have said to Ken Boston at the QCA, that tinkering around the edges of what we charge might have an impact of a couple of per cent somewhere and that is a discussion we can keep on having. We are a not for profit organisation and we are only ever going to charge what it costs to provide the service we provide, plus enough just to be sure we are safe and that we can invest for the following year or two, nothing more than that because we have got nobody to give the money to. The real crux of this is where does the cost come from. I think the discussion we are having here about what drives qualifications reform, how often do qualifications change, how many different bureaucrats do we have to engage with in order to bring a qualification successfully to market, those are the major drivers of cost for us. I will happily sit down and discuss with QCA and anybody else how we strip that system down and streamline it. Not only then do I think we will be able to drive some costs down, I think potentially we will have a more responsive qualification system, which is what Leitch was talking about.

Q595 Paul Holmes: Moving on to a slightly different area, the Qualifications and Credit Framework sounds like a very good move. If you move to modularisation, so a student, in whatever particular field it is can do part of a course, and they may not fill the whole course requirement but they will still get some credit for it and then they can add on to that later on, how is progress going on that?

Mr Humphries: John and I lead for the awarding bodies on the discussions on the QCF, so it is probably appropriate that we pick this up. I think we have all shared the aim for a modular unitised credit rated framework, it has been around for a long time. My organisation wrote a paper nearly five years ago advocating it and setting out an initial design. The frustration, first of all, is that five years on we are still not there yet so it is going slowly is the honest answer. It is a multi-faceted programme. You cannot have newly formed qualifications until you have new National Occupational Standards from Sector Skill Councils which are modularised. The second thing is there needs to be enough flexibility and choice in those to give the learner the option of partial completion. The jury is still out. We have not yet seen a single National Occupational Standard which meets that requirement. There is a timetable which brings the first ones into visibility in 2008, hopefully leading to qualifications in 2009. The timeframe is, assuming all goes well, we will see those in 2009. The reality is at the moment it is not clear there is going to be enough choice to make that real for the learner, in other words there will not be enough options and electives, freedom of choice, in the National Occupational Standards. That is something where the jury is still out. The second thing is whether the funding regime is going to permit learners to follow that route because at the moment there is still a full intention that only full qualifications attract the level of public funding, so it is very unclear how the funding regime is going to support this at the moment. I guess, for me, those are the big issues which are unresolved.

Q596 Paul Holmes: The Association of Colleges have said they do not see how the work on Sector Qualifications Strategies is lining up with the work on the Qualifications and Credit Framework, and if the Government or the LSC, as you say, are suggesting that funding will only go to a full qualification, not a partial, it is a bit of a shambles?

Mr Humphries: I guess the full answer is we have not worked out how to make all these bits chime properly together yet. There is time in the timeframe. As I said, the first new National Occupational Standards are not due to appear until late next year anyway, so we do have time to get this underway, and a lot of the testing and trialling which is going on at the moment is designed to try and get inside that, but there are big issues unresolved. Certainly, there is an increasing concern that Sector Qualifications Strategies and National Occupational Standards are not creating a unitised modular structure, they are not creating the freedom of choice, they are not creating the choice of options and electives which were assumed when the concept was created and then, secondly, that the funding regime at the moment is not designed to encourage and incentivise people to behave in that way, in fact it is going to be designed to encourage them to take qualifications within a limited timeframe. Given that the new funding regime at the moment is moving increasingly towards output related funding - the Chairman will remember that from the 1990s - then there is a big issue about whether it will even be feasible for providers to be able to offer that flexibility because if the individual does not complete the whole qualification, they may lose too much of their payment to make it viable. There are some big issues.

Q597 Paul Holmes: Is there one person or one body that carries the can for making all this fit together? Is that the QCA or is there nobody?

Mr Humphries: It is a thing called the "Vocational Qualifications Reform Programme Board", which is a four nation body with the four nations' Departments for Education, the four nations' qualifications regulators, two representatives from Sector Skills Councils and two representatives from awarding bodies on it. John and I are the two representatives from the awarding bodies and it meets monthly to seek to get all of these issues resolved.

Q598 Paul Holmes: Are you in regular talks with DfES, QCA, LSC?

Mr Humphries: Very regularly. LSC is there as well, I am sorry.

Q599 Paul Holmes: Yet there still seems to be all this disjointed work going on which is cancelling each other out.

Mr Humphries: I think there is a pretty shared commitment, to be honest, to try and get all this working.

Mr McNamara: We are trying to join it up and, as Chris said, that funding issue is a key issue. One of the good things which has come out of the work so far is the closeness we are getting to actual data, because the fact is in this country we have not got data which shows what vocational qualifications have done and are doing; we do not know the numbers. If you said to me today, "How many VRQs are we doing in engineering?", I could not tell you because the data we have collected is a direct result of the work we have done as part of that process. Certainly in terms of numbers of qualifications, if we get on to talking about that later we can go into some of the detail around that, what the numbers actually are.

Q600 Jeff Ennis: If we can now turn specifically to some of the 2020 targets which Leitch set out. For example, he said that we should have more than 40 per cent of adults qualified to level 4 or above, 95 per cent of adults to have functional literacy and numeracy skills, a doubling of apprenticeships between now and 2020 and more than 90 per cent of adult learners qualified to at least level 2. Are these the right sorts of targets we should be aiming at, and are they achievable, or is there anything which Leitch has missed out or got totally wrong?

Ms Sutcliffe: I would like to go back to a point I made in my opening comment about it is helpful to have targets for sure, but they could be seen as rather blunt instruments and they could be seen, again, as an economic response. It is clear there has to be an economic response to the issue of global competitiveness and preparing and getting the country equipped to cope going forward, but it is "Where is the individual in all of this?" As with all organisations, how could we not support the drive to make good a deficit model for those adults in or aspiring to be in the workplace who have not got a threshold of employability, and I think it is quite useful to define that in this level 2 target. What is difficult, however, and it has been alluded to already, is at the moment we have got a very, very tight definition of what currently constitutes level 2. The idea of being able to achieve level 2 from a variety of routes, to tap into an individual's interests and motivation and also the employer, again, we are severely hampered and restricted. Certainly by "we" I mean the system as a whole, providers particularly, and hence the initial feedback from Train to Gain in terms of numbers coming through that is not perhaps as good as we might have wished. I think there is something about what is the offer which can be made available. The other thing, of course, to bear in mind is that some individuals without any qualifications who do not need to go through a level 2 because they are already experienced in the workplace and they already have the skills. It is very much about ensuring that people are given an opportunity to perform and achieve at a level which best suits where they are at that point. Certainly level 4 we think is the right way to pitch it. For all the obvious and known reasons, we have to be an economy which is able to compete on higher skills delivery rather than a low skills economy. As a starting point, yes, but, please, do not just let us say, "If we get those targets", because, I have to say, if we were saying 95 per cent of the country is achieving at level 2, if we had 40 per cent at level 4, we could tack targets and labels on to these people, but would it make this economy any more competitive than we find it now? There is something much more fundamental, I would suggest, than simply being in a position to count more.

Q601 Jeff Ennis: Are the Leitch targets useful for the employers, John or Alan?

Mr McNamara: I think many of my employers would look at those targets and think, first of all, "What is level 2?", because most small businesses I know, and successful small businesses, whether they know it or not they are training all the time, from induction to customer service. They might not want a qualification for that or aspire to one but that is going on. Just by counting the number of level 2 achievements, I do not believe, is a true reflection of what is actually going on out there. I think there is a big mismatch, especially at the SME end, and I am talking for that segment that there is a mismatch between what that means in terms of their day-to-day business. Clearly we will play a part in making sure we can try and deliver that, but with Train to Gain, as it stands at the moment, if that is the only route, that is a very, very prescribed route. To be frank, most of our qualifications, which are short, sharp, focused, delivered on many occasions on the premises themselves, would not fit into that template and, therefore, they will not affect the uptake.

Mr Stevenson: In the food manufacturing industry I think Train to Gain has, indeed, started something, it is beginning to change the culture. The culture of the food industry generally is not particularly training friendly, you tended to get through as best you could but just with the minimum amount of training, mainly on hygiene precautions and health and safety, so that has considerably assisted. I think there is a concern in the industry that, perhaps, the targets are extremely ambitious, and there is also an issue on the funding as to where the funding is going to come. If I could go back, I think one of the things which is now beginning to help the Sector Skills Council, which, as I previously suggested, has been a slow starter, is that it has had very traditional industries to try and combine together, with the fish industry, the meat industry, the bakery trade. There has been a fair bit of work for them to do in trying to bring those industries together and getting some sort of consistent message coming from them towards training. They have started on a number of things, such as the national academies, so, yes, as I said, the jury is o.

Q602 Jeff Ennis: John, I think earlier on in the evidence you said that the performance and relationship between employers and the individual Sector Skills Councils can be described as good on occasions but overall it is patchy. What is the difference, from an employer's perspective, between the performances of the sectors? What makes a good Sector Skills Council as opposed to a patchy response?

Mr McNamara: I suppose there are three things I would look for. First of all, does that skills body use existing networks, trade associations, professional associations, what is already on there, where employers normally meet, be they large or small, including SMEs, that is the first point. The second point, do they take a strategic view of that sector or sub-sector, do they provide decent labour market information, information which guides employers in the decisions in terms of skills deployment. I think in some cases that has been incredibly good, in other places non-existent. Last, but not least, is that Sector Skills Council directly involved in trying to obtain, where it is appropriate, public funding for skills training and qualifications and for me those are the three measures for any small employer.

Q603 Jeff Ennis: What about listening to employers as well?

Mr McNamara: I guess that is part and parcel of the labour market information work and engaging with networks, I guess.

Q604 Jeff Ennis: One final question, Chairman, to representatives from the awarding bodies. Could it not be perceived that the objections which the awarding bodies have got to the expanding powers of the SSCs are very much a question of protectionism, shall we say, in not wanting to lose control of your fiefdom?

Mr McNamara: If you think we want to have this current system protected where we spend all day negotiating with umpteen different public bodies, having our costs driven relentlessly upwards by the management cost of dealing with all of those, and being forced to keep hundreds of qualifications on the books which are burning up my charitable resources, I cannot possibly imagine I want that world protecting at all.

Q605 Jeff Ennis: What is the alternative then, Greg, in your opinion?

Mr McNamara: I think the alternative is two-fold. The alternative is to be realistic about what this sector-based approach can deliver, and I think there are kinds of sectors and kinds of job roles for which that model is potentially very powerful, particularly for those where it is a strict licence to practise and it needs very tight prescription by an industry. I would argue that kind of system is kept healthily in control and in check by also allowing other innovation to flourish by other means. There are plenty of good qualifications which did not emerge through this bureaucratic model but emerged through a partnership between employers, individuals and these bodies.

Q606 Jeff Ennis: There is not enough flexibility in the new machines?

Mr McNamara: Yes, and if there was any suggestion that we would somehow seek protection out of all of this, I would challenge it. I said to QCR, "I think it would be a very healthy pilot to pick a sector and attempt the Leitch solution but also allow alternative provision to be marketed freely with relatively little restriction and a very low level of regulation, just fitness for purpose, let us find out what learners and employers in the end find most attractive and most responsive. The difficulty we have got is gradually as the strength of the bureaucracy has grown it has become ever harder, as I talked about in 2005 with Enterprise Qualifications, to get the competing alternative even into the field of play. I have to say, that is not a world I want protecting at all.

Mr Humphries: There is a sense in which, Mr Ennis, the system we are currently building could make life easier for awarding bodies if we did not care about the impact on learners and employers, because there is a perfect excuse for if your qualifications do not fit, "Well, the Sector Skills Council told us that is what we had to do. It doesn't work, it is not our problem, it is their problem". The difficulty is we are already starting to see some of these problems arise. My organisation is 128 years old. We have been around all that time because somehow or other we must have kept track ---

Q607 Jeff Ennis: It is the recognised market.

Mr Humphries: --- of employers needs or they would have stopped using us years ago. My concern, and genuine concern, which has been around for all of my time, 25 years working in this field, is that we have a principal obligation to two groups of people: the learners who want to progress in the world of work, which is what my system, my qualifications, cover, and the employers who want to employ them. It will never serve City and Guilds' interests or our reputation or credibility to be able to put stuff on the market which either does not sell or is not wanted. I have got one simple desire here, to have a system which gives employers and individuals what they need, and this is a genuine concern that we may be getting some of it wrong and a desperate concern to make sure we get it right.

Q608 Chairman: All governments, for the 25 years, you have been involved with a lot of organisations, what is the heart of it? Why can we not get it right? Why are we so good at getting it wrong? It is your fault, Chris, you are the constant theme here!

Mr Humphries: Chairman, I have been around too long!

Q609 Chairman: Twenty five years of anarchy!

Mr Humphries: To be honest, I think the answer is we distrust learners' and employers' own choices too much and I think this is something we have heard said in many areas of education, not just vocational. We really need to have three things. We do need a good understanding of the way in which the industry goes - I have supported the SSCs in that role ever since NTOs were around - but we need also to trust the fact that employers and individuals have personal and individualised needs, customised and tailored needs, which somehow or other the system needs to respond to. If you look at the last 20 years of activity, it has often been around government creating institutions which seek to tell the world how it should behave. Whereas, I think their objective should be to help the world get what it needs, that probably means giving guidance, direction, support, encouragement, promotion out into the sector, and ensuring that the market works well through informed demand and the freedom to put into the marketplace those things which work. Remember why City and Guilds operated, and other awarding bodies like RSA from the vocational sector and BTEC, is they were saving the costs of 400 colleges and 5,000 training providers each going out and developing their own curriculum, their own exams, their own assessments and all that sort of stuff. We were created and we have survived because the cost of doing it 5,000 times over, and each of them trying to talk to employers, was going to be completely unworkable. Somehow or other we need to recognise the value which that has and the value which SSCs bring and realign them back into a relationship which is about partnership.

Q610 Chairman: You have put your finger on it in what you have said there. On the one hand, you are saying free up employers to decide what they want and the inference from it, that sounds very Leitch to me, on the other hand, the individuals. But over those 25 years, which I have just accused you of being the subversive element, we have tried trusting employers and trusting individuals time and time again and the reason different governments keep saying, "We are going to try this. We are going to try that. We are going to try NTOs. We are going to try SSCs", is because freeing up those two does not seem to work because we seem to have awful employers in terms of how much they care about training their staff and individuals who do not seem well motivated to get training.

Mr Humphries: Yet, if you look back over the last ten years, there have been some remarkable successes. Whether or not someone wants to sit there and tell them they were doing the right or wrong course, I am not sure, but participation in the further education sector has risen dramatically, the volume of employer training has risen dramatically, and the number of people doing apprenticeships has risen dramatically. There are lots of things we have been doing right, but there is an extent to which you can over-engineer these things, and my concern is I think we might be getting to the point where over-engineering is starting to happen. If you look back two years, by the LSC's own figures, of course, the number of adults participating in the system has dropped by a million and to the end point where in September last year we had less adults enrolled in the adult further education sector than we had in 1997. A hell of a lot of things have been happening, and I think often we go for the draconian change rather than progressive re-engineering, and that sort of pendulum swing you can get can often be more destructive than going for continuous improvement.

Q611 Stephen Williams: There is not much left on this section to ask, Chairman, but I will follow on the theme which you were doing about this overarching theory behind Leitch. If I could start with one of the employers, John McNamara. At the moment, as someone representing the hospitality industry, do you think the qualification bodies and colleges and the whole infrastructure of training and education do not offer you what you need in the hospitality sector? Do you feel it is not enough demand-led at the moment?

Mr McNamara: That is a broad area. Obviously we do represent small businesses as a professional body. We also own an awning body called BIAB, so that is a wholly owned part of our charity, and we deliver through 580 centres across 5,000 different locations in the UK. That ranges from college provision to independent work-based learning provider provision. In an SME sector it is very, very difficult to release people from frontline duties to go and attend a college programme for more than a day or two a week, very unusual in our sector for that to have effect. Some of the larger employers do it very successfully, but for the 85 per cent of SMEs it is very hard to do it. What we found, as an awarding body, is that delivering short, sharp chunks of learning, some of them regulatory, sometimes taken in colleges or with independent work-based learning providers, is quite effective in delivering that. What we have had to do as a body is deliver different solutions, different learning, especially on the entrepreneurial side at level 3 where we are training people, helping people and equipping people to survive in business more effectively. To deliver that in a traditional format is very difficult, so we have broken that down into short, sharp chunks of learning delivered in a variety of venues, some of which are colleges. I suppose I would argue, for my part of hospitality, it is very difficult to get our sorts of employers to engage in FE colleges on extended programmes. We have tried to design programmes which meet that need.

Q612 Stephen Williams: If I could summarise, Chairman, what you are actually saying is for your particular sector you are meeting your own demand effectively because you feel the rest of the educational infrastructure cannot meet it because it is not an appropriate setting?

Mr McNamara: To a certain extent, yes.

Q613 Stephen Williams: Can I ask a question of Chris Humphries, City and Guilds, Chairman, and of the two awarding bodies as well. From your submissions you seem to be expressing a concern that the approach of Leitch of setting targets is bit top-down, and one of your submissions described it as a "command system" rather than a demand system. Have we got a tension here between a Treasury commissioned report, so it is Mr Brown's report, have we got the Chancellor pulling levers in the Treasury saying, "This is what shall happen in the economy", but what it purports to be doing is saying, "This is going to be a demand-led system"? Is there a conflict there?

Mr Humphries: There is a tension, I think, in any of these systems around the question of "Whose demand is it anyway?" and I do not just mean between the learner and the individual. In one of the papers which is going to the Vocational Qualification Reform Programme Board this Friday is a question which says, "How do we ensure the system is really led by employer-demand rather than by SSC desire?" That is a question which has gone in with the full approval of the SSC network in appearing in that paper because, the point I was making earlier, if you have to represent one and a half million employers in 14 sub-sectors as part of your remit, then the chances of you ever being able to cover every sector in detail is very, very limited. The tendency is to look for quick answers and to try and have as few answers as possible. If that is the result, if what the SSC decides can be done by employers is all which is allowed, then the desire to create a demand-led system does end up creating a command-led system, the command in this case coming from the mix of policy and Sector Skills Council activity. Then you have to add the third dimension, which is, "Does the leaner get a voice in demand anywhere at all?", and the answer is "You can build learner-demand in as well, providing you make the thing flexible, create that unitised modular credit weighted framework which enables people to accumulate bits and pieces and get enough flexibility". My belief is you can create a system which has all of that, and in the outline design of what was conceived for the Qualifications and Credit Framework is that potential, but it is possible to do things in parts of that process which then suddenly narrow it all down again. If there is no choice or units or electives or the option to do a business start-up programme in training to be a plumber, because you would want to be a self-employed plumber, if we do not build that flexibility in, then you have just constrained the learner-demand. If you do not allow them to take the French language as part of a project management programme, because your company happens to operate in Europe as well, have you constrained it from the employer point of view? In other words, there is nothing wrong with the ideas, the policy, the philosophy behind this system, our concerns come at the way in which it is implemented. It seems to me there are some important choices being made here which we need to keep as flexible and open as possible.

Ms Sutcliffe: It is part of our submission, we felt in the demand-led, you have got the demand from Government, you have got the demand from employers and you have got the demand from individuals. I think it becomes complicated then if you are thinking about 14 to 18, the intention to keep young people in some form of education training up to 18, then who really should be exercising the demand? I see that absolutely as Government having to because government would be paying and, therefore, want to have close involvement through your various agencies about the nature of the provision which is made available to those young people as they move through a system. Just as Chris says, then when you start with employers, okay, there might be a deficit model where government would be very interested in supporting employers to make good that threshold employability, but as soon as you move beyond those, you are into employers exercising their own choice of what it is they need to meet a skills gap, a training gap, and equipping themselves going forward and then, again, the additional factor of what is motivating an individual. That is a very complex set of different ages of people, different sorts of organisations at different stages in time all putting demands in and how do we then create a system which can cope with that. The only way is very much, as was enshrined in the original proposals behind the QCF where you have got this maximum amount of flexibility, that is then enshrined by the funding regime going forward over time and, as clearly put in Leitch, there will be the taper, government pays 100 per cent at that end and the individual and employer pays 100 per cent at the other. We have got to have a regulatory backup system which allows for a smooth move across that continuum from one to the other. At the moment, it is all very much at this end, and what will happen is the bespokeness of the provision we all continue to do but somehow it continues to fall outside what is seen as being possible to be counted into how skilled are we as a nation.

Q614 Stephen Williams: I have got one supplementary based on what Isabel was saying but not to Isabel, back to the hospitality industries, on this question of raising the education and training participation age - which I think we are supposed to call it - to 18. The hospitality industry, if my impression is correct, probably disproportionately employs more younger people straight from school than many other sectors. What is your sector's view on raising that training age to 18, given what you said earlier about the difficulty of releasing people into training?

Mr McNamara: Clearly it is a challenge for the sector to overcome. Again, I speak from a particular sub-sector which does not get public funding for most of its training, and anything which can improve access to that is what we would expect sector skills bodies and professional bodies like mine to be fighting for, at whatever age. Bear in mind, we also have a number of employees in the sector coming back to work, or in the older age brackets anyway, who should also attract some level of support and some level of funding as well.

Q615 Chairman: Should we not sometimes ask the question, be it a large business or a small business, "Why should the taxpayer pay to make a company train its people so they are more effective to make a better profit for the company?" I find it strange going to a very large company, which is one of the most profitable companies in the universe, and we are giving them money under Train to Gain to train their people who they would have been training anyway. Is it a nonsense world?

Mr McNamara: I guess with LSC budgets of £12 billion a year, the CBI figures and IoD figures range from £33 to £40 to £50 billion of company money spent on training, you could argue that does include release time as well as the actual training money spent, but there is a big balance argument there about companies already spending considerable resources on training, some of it accredited, some of it not. My particular beef is trying to get as much state support for small enterprises that traditionally have not had access to funding or find it complicated to get hold of the correct advice for a range of provision. I am not suggesting that every single training programme or development programme could be funded, it is clearly not that simple.

Q616 Chairman: What I am saying to you, John, is I can understand why your members, because they are small and have more of a struggle, should get state funding, taxpayers' money, rather than Tesco or Sainsbury's or Asda. That is the conundrum, is it not? Can I ask you a separate question. In the last session we had last week we had a representative from the Sector Skills Council in hospitality who said there was this dreadful shortage of chefs. I always make it a rule not to go into a restaurant which has a card in the window which says "Chef required", but he said there was a five per cent undersupply of chefs. With the best will in the world, here we have a culture at the moment obsessed with chefs and cooking and Gordon Ramsay and Jamie Oliver and so on, and there must be a tremendous desire to be a chef now that it is seen as a glamorous occupation. What on earth has gone wrong with your industry that you cannot find enough chefs or train enough chefs?

Mr McNamara: It is a tough business, a tough competitive world and a hard environment to work in. If you look at the figures we have, they indicate that chef numbers in some of the better business schools are buoyant, they are going up. As a sector, again, we have recently introduced a catering qualification aimed at pub businesses mainly which are introducing a new provision for catering on the back of the smoking ban especially, that is an important area, and it has been an interesting story getting that qualification accredited. It is going through the process now but we have had, as Chris was indicating earlier on, about 14 stages, I would say, Chris, to try and get it to the stage of being accredited, and even that qualification will not, under present rules, attract public funding. What we want on the new QCF, or the NQF as it is now, is public recognition that our learners should aspire to have the recognition of having a qualification which is nationally recognised. It is not an easy answer but it is a key issue for the industry.

Q617 Chairman: Deadweight then. Should we be giving big successful organisations money to train?

Mr Humphries: You know the final report of this Skills Task Force from 2000 for the first time proposed that we needed to have a system of, what we call, "tripartite responsibility" where it is absolutely clear what the state pays for and it is absolutely clear that employers and/or individuals need to contribute to the rest of that according to the benefit they gain. I think it is a simple matter to divide it up. There is a reasonable expectation that the state should produce young people who have a level 2 and reasonable levels of literacy and numeracy. We also know that the gain for the individual and the employer does increase according to the levels studied. In 2000 we were advocating, "Go out and negotiate with industry a basis for sharing the costs of training" because, of course, it is not reasonable for the state to pick up all the cost and in a lifelong learning system there is no way the state can afford to do it. It is rather worrying that we are seven years on from then and we still have not started the process, although the Leitch Report has, again, reminded us of the need to do it. I think there is a big government and industry issue here which is about sitting down and agreeing the basis on which the costs of education and training, particularly in the vocational adult sector, are shared. You are absolutely right, it is not sensible and not reasonable for the country to expect, and for industry to expect, the state to bear all the costs, but it is complex and you do have to agree the parameters by which you divvy up out the costs, so let us get on and do it.

Mr Watson: I would set against all of that, though, the need to keep individuals involved in learning if we want to get to some of those 2020 targets. I do not think we will get to the 2020 targets simply by linking everything which goes on in the education and training system to short-term needs defined by particular employers, regardless of whether the employers pay or not. Just to illustrate that, still the single most heavily used vocational qualification used in this country is CLAIT, which is over 15 years old. It has been taken by three million people and, despite all the forecasts to the contrary that by now everyone must know how to use a computer, it is still the most heavily used qualification. When we go and try and understand why, it is not anymore because it accurately describes a particular skill which employers say they want, it is that for many women returners and many older people looking for a career switch, it is a course of study which they find motivating, they find reassuring, even if they have acquired some skills informally it gives them the confidence that they formalise those skills. Above all, very often it is a way back into work for people, to do something which gets them feeling that they are getting back into touch with work. I think that is a beautiful illustration because that is one of those qualifications which those who talk strictly in terms of defined sector needs find it very hard to get to grips with. "It must be outdated. It is a scandal that we spend so much money on it still", actually that is performing a very important role. If we are going to get anywhere near the 2020 targets we have got to allow for qualifications which get individuals involved in learning, almost regardless of what the specifics are that they are coming through the college door to do.

Q618 Chairman: One of our witnesses last week said many employers in his sector still advertise for a qualification which has not been available for 15 years and that is an interesting lack of information

Mr McNamara: Chairman, seven per cent of the sector advertises for 7061/7062, so that means 93 per cent do not.

Chairman: We will move on to looking at awarding bodies and intermediaries with Gordon.

Q619 Mr Marsden: We have heard a lot about, not least just in the last couple of minutes, the shelf life of various of these qualifications, but I would like to start off, if I may, with you, Isabel, going back to the written evidence which Edexcel submitted. You argued in there that many employers do work with qualification developers at the moment, quite reasonably, but that, perhaps, a lighter-touch regime would boost employer engagement, particularly in achieving accreditation from the QCA. Imagine you are Ken Boston for a moment, how light-touch does that have to be to achieve real results in terms of improving employer engagement?

Ms Sutcliffe: I will try and answer the question, but I think it comes back to we are in the business of wanting whatever we develop in response to a perceived need to be a success. I have mentioned before that those of us with strong vocational qualification heritage, that is all founded on working very, very closely with individual groups of employers, an employing sector, to ensure that we really understand what their needs are and then are playing that back to them in the form of the qualification. Where you would say, "What satisfies enough employer engagement?" and the evidence which we then put forward as part of our accreditation process through to QCA is, to me, seen in the way we, as Edexcel, organise our business. We do have a lighter-touch system working now for the accreditation of qualifications, thankfully the days of it being two years in terms of putting a submission into QCA and hearing whether it is accredited or not are well past, thank goodness. We have got a much more mature system working in terms of an awarding body's relationship with its regulator where the regulator is taking an overview of our systems and processes, and built into the development process of all of us, as awarding bodies, is that key factor of how we engage with employers. Instead of looking at the detail of an individual qualification, you are looking at a process. Providing we can show that in meeting an employer's demand we are talking and taking lots and lots of care over ensuring it is not necessarily an isolated demand, particularly when we are talking about something which has been nationally available, that seems to work quite well.

Q620 Mr Marsden: That is all a bit woolly. Maybe it has to be but I am just saying, there is no magic button you would press.

Ms Sutcliffe: No, and there cannot possibly be because - stating the obvious - employers, by definition, are a very diverse set of organisations. It is very easy to say - and I speak as an employer myself - what we do not get and what is not good, but when charged to be absolutely articulate about what your needs are, it becomes quite difficult, not least because their business is not in teasing out training, learning outcomes and being able to then put them into a set of assessed activity, that is our expertise.

Q621 Mr Marsden: Chris, if I could take us on from there, you rightly reminded us you have been around a long time and you said you would not be around if you had not been doing something right with employers. Moving beyond City and Guilds, do you think it is true across the board that qualifications are in need of reform because they are not sufficiently responsive to employer needs, or are we looking at particular black holes in particular sectors?

Mr Humphries: I think we have had two types of qualifications in the sector and they have been meeting different needs. The vast majority of qualifications which are on the NQF that are approved by their NTOs and get onto the National Qualifications Framework, NSS as it is now, have usually gone through two stages of good testing. They have either been developed in conjunction with groups of employers, they have usually then been signed off by the NTO. I think the vast majority of those cases you can argue both from the initial testing with groups of employers and the NTO side, most of those are now reviewed every two to three years where they used to be reviewed every five to six years. The rate at which they are updated and modernised has really halved or doubled, depending on how you measure that. That is part of the reason why it is essential to keep light-touch because if the review process takes too long and you have to do it every three years, then the gap between need and delivery is getting bigger. The whole set of second groups of qualifications, which were designed more for the learner, to meet the needs of individual learners, perhaps learners doing lifelong learning, doing a bit of tasting and testing or looking to update and professionalise and modernise through short courses a set of skills they already had, these have a much less measurable impact, both in terms of benefit for employers. A lot of the criticism which has been focused on qualifications over the last few years has been on those short courses which serve as, immediately, the sort of thing John was talking about.

Q622 Chairman: John said he had to produce his own because people like you did not do the short ones.

Mr Humphries: City and Guilds does not do short courses, there is no question about that, we do not, we do full-scale courses. We do create modular programmes where people can do bits and pieces. They are all modularised, but we still design them in the context of a qualification which qualifies you for something. It is not us that stops John putting the short courses into the market place, it is the policy today. A lot of the focus has been on the extent to which those things can be seen to be making a visible and tangible employment difference.

Q623 Mr Marsden: This is the debate between soft enabling skills or hardwire skills, essentially.

Mr Humphries: In part, it is also the debate about whether you allow someone to do small bits of learning in a modular form, and that is enough, or because of the challenge which is seen to exist around how many qualified people we have, whether the public priority for expenditure should be on the full qualifications. It is that latter thing which has driven a lot of the behaviour.

Q624 Mr Marsden: Fine. Thank you. Greg, I wonder if I could bring you in here and ask you one or two basic questions about what happens to your own agency, OCR's agency. What would you say the rate of turnover is for the qualifications which you produce? Is it possible to quantify?

Mr Watson: Pretty much everything at the moment is turning over on an annual basis. I would have to go back and check exact statistics if the Committee wanted them. At the very least, because we are in a period of stasis, because Leitch is up in the air and the QCF is slightly up in the air, we have got a lot of things now on very short accreditation cycles. In fact, when you read the misleading numbers of qualifications which are often quoted in speeches and papers, much of that reflects the fact that we have currently got three or four parallel versions of the same qualification which is being re-licensed annually.

Q625 Mr Marsden: This is the new improved version, it is not a new thing? I am not being critical.

Mr Watson: No, honestly, it is very often not even newly improved, it is simply re-licensed for another year while we work out what we are doing long-term.

Q626 Mr Marsden: You would argue then that these figures which are thrown around of 6,000, 10,000 are based on a misunderstanding of what is actually out there, that in real terms the real number of different products is far less?

Mr Watson: Without a doubt. In fact, John and I were talking about this the other evening. We are three-quarters of the way towards the real answer through some work that the auditing bodies have been doing collectively. The sweepstake ticket I have got in my desk says 500 will be the final answer.

Q627 Mr Marsden: In that case, I am tempted to ask why you have not been more successful in your PR in persuading the rest of us all who constantly quote these things, but I will not go on to that!

Mr Watson: For the same reason that CLAIT is still heavily used after 15 years, I suspect.

Q628 Mr Marsden: Let us talk about the new things which you launch. Of the qualifications which you do launch that are new, how many of them fail to stimulate enough demand? How many flop?

Mr Watson: Of the ones which we have conceived, consulted with employers or universities and schools and colleges about a launch, I would say our success rate is 75 per cent. Of those which are born of a sector skills strategy of some sort, less than ten per cent, off the top of my head.

Q629 Mr Marsden: That is a very interesting differential, is it not? What happens to them? How long do you leave them out there before you decide, "This is not selling", to put it crudely?

Mr Watson: The shortest time would be about three years. There is a lead-in for a typical college of the year before launch needing to have it in a prospectus to recruit students for it.

Q630 Mr Marsden: Chris, what about you?

Mr Humphries: We have a significant number of qualifications which do not have any sales, but in every case they are qualifications we have put into the market at the request of an NTO or an SSC. Many of them are there for very legitimate reasons. They are qualifications at level 4 and level 5 where the sector desperately wants to persuade people in their industry to up-skill and they cannot do that unless there is something in the marketplace. Then there are others where the sector is keen to get a particular group or occupation to take up training and, again, you cannot do it, so we will often put things into the marketplace at the request of an SSC in order to allow them to promote to the sector in order to do it. We accept that is a loss-maker for us in the context of trying to provide a complete service for the industry. What we have found recently, through work we have been doing under this Vocational Qualification Reform Programme, because the awarding bodies have a strand of work ourselves in that, is that the most significant number of those vocational qualifications which have low take-up, the SSCs themselves do not want to remove from the market, because we have asked them, because they are still keen to try and get their industry to take them up, so you plan that into your business.

Q631 Mr Marsden: A cruel or cynical person might say that the SSCs were anxious to keep them out there because it justified their existence.

Mr Humphries: I would not say that, I would say in our relationships there is always a genuine industry reason behind them seeking to do it, particularly the higher level qualifications where it is a hard sell to get the industry to take up those. Given that this predates the SSCs and dates back to the NTOs as well, I would not say that.

Mr Watson: To shed a bit of light on the problem. OCR itself has a formal approval process for deciding to go ahead with a new qualification. It does not have 13 steps in it, it has two. What is interesting is, having seen a couple of cycles through now since I have been involved in post-19 qualifications, I am beginning to get interested in those qualifications which come back for a second run when the first run failed. I have been going back and reviewing the papers which were submitted with the original internal proposal and I think the most regular feature which I discover in those that have failed is that they were originally claimed by the NTO or the SSC as licences to practise, "These will be mandatory from..." and there is usually a date quoted in the paper. Many, many times, when we go back to understand why that qualification never took off, in truth it is because there was not appetite for that kind of very strict licence to practise in that particular sector, although there was a desire for it.

Mr Humphries: It was more intention and desire.

Mr Watson: Yes, but because it did not acquire the status of a licence to practise, no learner felt compelled to go and get it.

Q632 Mr Marsden: Isabel, could I possibly ask you quickly, would it help, both in terms of public perception and also in terms of practical utility, if some of these qualifications had a sunset clause in them? You would say, "If they do not reach a certain target market within three or five years, that is it".

Ms Sutcliffe: I think the system works quite well as it does at the moment in terms of review, evaluation and remove if because I think we all have similar systems for keeping existing qualifications under review, particularly those with low take-up. We would have an annual review, those with no take-up and the reasons behind it. It is a long process to remove anything because you are never quite sure where a learner might be on a journey for all of those reasons. We have had some issues with what seems to have been rather arbitrary accreditation end dates placed on qualifications, which is the same sort of thing because you are never quite sure if you are going to get an extension or you can get it reaccredited. An employer using a qualification is one thing, but if you think about a college or a training provider looking at a range, it makes their planning going forward quite difficult if they do not know whether to brave security for something they want to invest in, it could be planned as well as people, to get a programme off the ground.

Q633 Mr Marsden: The answer to my question is basically no?

Ms Sutcliffe: Yes. It works okay, so there are lots of other things to fix.

Mr McNamara: Can I give a very brief view from a professional body. Any awarding body, professional body is very, very close to employers in designing qualifications at the design stage, as we do. We do not launch anything without an employer group, sometimes with the regulator if it is regulatory, but if it is business building, it is employer-led, we design it, we float it and we test fly it. There have been a number of cases where we have not launched a qualification because it does not work, and if it does not work we do not launch it. We build in our own sunset clauses because, certainly at level 3, those qualifications which build into a larger suite of level 3s are designed to improve bottom line. If they do not improve bottom line they will not fly and that is an inbuilt part of the process. Other awarding bodies I know do the same thing, but it is becoming more and more critical for that to happen. To pick on Greg's point, the work we have done on Strand 4 in terms of numbers, it looks like it will be between 500 and 1,000, which is on that framework, if you get the data right, if you count it right, if you codify it properly, and we are getting into that data now. As you say, the fact that people are still on platforms saying, "It is 5,000. It is 6,000. It is 22,000", these are real figures and real complexities which we are trying to break through.

Q634 Mr Marsden: Chairman, I wonder if I could come finally to the issue of accrediting in-house training, which touches quite sharply on what you have said. Can I stay with you, John, possibly Alan might want to add something on this as well. There has been a lot talked about employer' own training programmes and the point at which they come into sync with things that come from outside. Would it be possible, or sensible, for those training programmes to be accredited and effectively brought into the National Qualifications Framework?

Mr McNamara: I think in some cases the short answer is yes. We already accredit some organisations' qualifications and they put them through the rigour of external assessment, an external look, and they are accredited. I think into the future, as long as that externality is brought forward for those organisations coming into the framework, why not.

Q635 Mr Marsden: I mentioned that particularly because we had a very stimulating session not so long ago in this section of the inquiry with union learning reps. It is fairly clear from the evidence they gave, and, indeed, from the written evidence we have received, that some of the more dramatic things in terms of trying to engage adult learners come from that in-house short-term training.

Ms Sutcliffe: Absolutely.

Mr Stevenson: I was going to fully support what has been said. The Meat Training Council has concentrated on management development. As an industry, it has a weak management structure. In many cases it is family orientated and does not always follow the rest of the family as they go back. They have the ability to manage a company properly. We have done knife skills, we have done supermarket courses, all designed in-house with the help and support of employers and the industry generally and these have been launched. Generally, in the case of knife skills, they have now been accredited and management development as well.

Mr Humphries: This has been happening for many years. The three examples which Ken Boston gave in his QCA review this year were all employers which City and Guilds is already accrediting and they are training for. Tesco's training, Orange is another one, London Underground's training, all of their training is both meeting national standards, completely accredited within the framework, and branded Tesco's as well as City and Guilds in the National Qualifications Framework. These things are being done already and in big volumes when you consider the whole of Tesco's training.

Q636 Mr Marsden: We had evidence from the 157 Group of Colleges, and other people in the FE sector have certainly said to me personally it would be a great help. Why is there such a dichotomy of understanding between what seems to go on in FE colleges about this and what, as you say, is already happening on the ground floor?

Mr Humphries: Because, of course, this training takes place in Tesco's stores, not in colleges. The training is Tesco's in-house training but they changed - if I use them as an example - their training procedures to meet ours and QCA's requirements, they changed their staff development requirements, they changed their reporting and assessment requirements because their staff said, "We would like to have your training accredited". They changed and built in new systems into Tesco's so that their staff training would meet the externally accredited requirements of the National Qualifications Framework but, as a result of that, the training takes place inside Tesco's. It happens to be externally accredited and assessed by us but it, therefore, is not happening in colleges or training providers, it is happening in the employer's premises.

Q637 Mr Marsden: You are saying it is not a question of reinventing the wheel, it is a question of better communication and better understanding between the different sectors?

Mr Humphries: And encouraging the practice because what I must say to you is when we took Tesco's proposition we had to go to the QCA main board in order to get it through because the tendency of the staff was to reject this as a model for acceptance within the framework. It was quite a battle to get it accredited and accepted that the standards were being maintained. What we need to do is make it easier for it to happen, providing external quality assurance requirements are met. What you cannot afford to do is have acme stores provide training which is not comparable to the network and then have them taken up by Wal-Mart or Asda later and have them say, "This is crap. Why was this accredited? These people can't do the job". Maintaining quality remains critically important, but let them bring it into the framework through external quality assurance, sure, why not.

Chairman: I have got to call a halt to this. It has been a very good session, and I think some of you might prepare yourselves for coming back again because we just started getting under the subject. It has been a very good session. Alan, John, Isabel, Greg and Chris, can I thank you all very much for your attendance. As I say, we have learned a lot, but we may have to come back to you. As you are travelling away from here, if there are things which we should have asked you or you should have said to us, get in touch. Most of you meet us a lot of the time anyway. We want this skills inquiry to be a rather good one and we will not do that without your help. Thank you all.