Examination of Witnesses (Questions 40-59)
LORD LEITCH
AND LOUISE
TILBURY
28 APRIL 2008
Q40 Dr Blackman-Woods: Yes.
Lord Leitch: I think there is
a role for regionals when you have a big land mass and few cities.
That seems logical to me.
Mr Marsden: We move on now to where you
recommend in your report a new partnership between government
employers and individuals in taking action on skills and training,
so we are going to be asking a set of questions about the demand-led
system and responsibility for skills.
Q41 Mr Willis: First, I was very
interested in your analysis here of the way forward, particularly
at higher level skills, level 4 and above. You made it clear that
you feel that employers and the employee or the student should
provide the main bulk in terms of the funding of those qualifications
and the gaining of skills at higher levels, is that correct?
Lord Leitch: For the additional
funding?
Q42 Mr Willis: Yes.
Lord Leitch: One of the principles
was that those who benefit most should invest most.
Q43 Mr Willis: We have a simple calculation
that, between now and 2020, we have to move from a position where
roughly 39% of people are going to university to where 50% going
to university in the 18-30 group. We also have to get to a situation
where roughly one in four people have a qualification at level
4 and above to a situation where four out of 10 have a qualification.
That is a big challenge and will require a huge expansion of higher
education and skills training above level 4. Do we agree that
that is the starting point of this discussion?
Lord Leitch: I agree.
Q44 Mr Willis: In which case your
argument is that, because you see employers and the employee or
the individual as being the main beneficiaries, that expansion
will be funded by those two groups?
Lord Leitch: Yes.
Q45 Mr Willis: What earthly evidence
have you to support that?
Lord Leitch: What "earthly"
evidence?
Q46 Mr Willis: Yes. Where is the
evidence to support that? These were just calculations that were
made without any evidence, were they not?
Lord Leitch: No, we had evidence
here. You are right about the expansion and you are right about
the increased investment we need to make in higher education.
At the moment the United Kingdom invests 1.1% of GDP in higher
education, the United States 2.9%, South Korea 2.6%, Australia
2.5%, Scandinavia 2.5%, so clearly there is a shift to take place
here, but those investments are a mixture of public and private
and I think our view was that, looking at what the State invests
in other countries carefully it did not seem right that the State
should invest dramatically more when there are key advantages
to that. For example, take employers. We think there is a very
significant opportunity for employers to co-invest in improving
the qualifications of the existing stock.
Q47 Mr Willis: But employers are
not stupid, are they—at least I hope you are not saying
they are. Why have they not come to that conclusion? Because if
their employees are more productive then there is more profit
and they can have bigger Ferraris or Ford Focuses?
Lord Leitch: Of course they are
not stupid, and employers in this country have done a very good
job, by and large, for training, but one third do no training.
Q48 Mr Willis: But where is the quantum
leap going to come? Where is your evidence to say that suddenly,
because Sandy Leitch has produced this report and the Government
says "Halleluiah", all employers are saying "Where
can we get the latest higher education training? Where can we
fund it?"
Lord Leitch: Can I go back an
hour, when I said there is no panacea? Employers are not going
to wake up and say "This is the way we are going to do it".
This is a journey and there are many steps. I can give you an
example which I think is a beacon of what we can do. There is
a Sector Skills Councils called e-skills, the IT industries of
the United Kingdom. They got together and they said "We need
more graduates with a curriculum that suits our businesses".
So they got together, pooled their resources and their expertise
and are working with a variety of universities, and have designed
particular graduate courses for them that they can have for new
people and for existing recruits. They partially fund these, and
I think this is the way forward for significant more investment.
Q49 Mr Willis: How many other national
Sector Skills Councils are doing the same?
Lord Leitch: When you have change
you have to start with a leader on change, and I think this is
a great opportunity. We also have Tesco's, Royal Bank of Scotland,
Flybe and Network Rail all looking to do these co-investments.
If this is done properly it is the right way forward. Research
happens in other countries in the world and if it happens in other
countries in the world we should be showing that it can happen
here, so I feel very confident we can deliver this, if we get
the right leadership.
Q50 Mr Willis: In the Sector Skills
Councils, or where?
Lord Leitch: Can I talk about
Sector Skills Councils?
Q51 Mr Marsden: Yes.
Lord Leitch: I started off liking
the concept of Sector Skills Councils but not so much the delivery.
I saw one third doing well, one third badly and one third unproven,
and I thought "Goodness gracious". Conceptually it is
the right approach, and I think one of the areas missing on the
two thirds neutral or negative was about strong leadership in
getting employers to come together. Like in many areas in life
it is about somebody being the champion and showing the way, so
that is why we call for the reformation and the re-licensing of
Sector Skills Councils.
Q52 Mr Willis: Let's hope you are
right and the Sector Skills Councils all become incredibly dynamic
bodies that take their employers into the trenches and buy into
all these extra skills. Let's assume that is right. It has never
happened before but let's assume it happens on this occasion.
Lord Leitch: Yes.
Q53 Mr Willis: As far as universities
are concerned, and to some extent colleges but particularly universities,
we have had university tradition which is basically about university
autonomy, about it being, if you like, a supply-side system. You
are suggesting in your report, and the Government has accepted,
that we are now going to have a demand-led system within Higher
Education 2, with employers, given that you already have briefed
that this expansion will come via employers, through the Sector
Skills Councils making demands on higher education institutions
to produce the sorts of courses and products which they want.
Will that not change the whole nature of our higher education
institutions in the same way as Train to Gain is potentially likely
to change—I am not saying for good or bad—the nature
of our further education institutions?
Lord Leitch: Yes, it will alter
the balance, but may I say that the most successful development
of university courses in recent years has been MBAs, which are
not supply driven but are also demand led. This is what industry
is requiring, and they have been fantastically successful. So
your example that universities are only supply-driven is not correct.
Q54 Mr Willis: But the majority,
of course, are supply driven.
Lord Leitch: But it is the evolution
here.
Q55 Mr Willis: But that is what you
see happening?
Lord Leitch: Yes, but, if you
look, there are degrees in architecture, engineering and all these
things. This is not about being supply driven; this is about being
demand driven as well. We need these graduates in these subjects.
There are degrees in law, medicine; this is not just learning
for learning's sake but learning for a profession. For instance,
Richard Lambert did a report three or four years ago and he was
basically saying there is a mismatch of needs in our society,
and university must engage much more with employers, and I think
the forward universities are doing exactly that. Business has
found it difficult to engage with universities, and they must
find it easy to engage with universities. There is real employer
concern, and what we have now is changing. We are at a turning
point.
Q56 Mr Willis: So we are going to
have a Benthamite, utilitarian approach to higher education in
the future?
Lord Leitch: No, that is not fair.
It is not utilitarian; it is about a flexible approach that is
demand-led.
Q57 Mr Willis: Well, let's park that
one as well. The other big driver for this is, in fact, money.
At the moment 90% of all funding in higher education to support
students goes on three year, full-time undergraduates; 10% goes
on part-time. The whole essence of the development that you see
in your report is about part-time students really delivering in
the work place, students who are earning as well as learning at
the same time. Why did you not as one of your conclusions and
recommendations ask for a shift of resources so that you are incentivising
and supporting people up-skilling from level 3 to 4, and, indeed,
from level 4 onwards? Why was there not a change in the support
mechanism recommended so that part-time students in particular
got the sorts of incentives that full-time students get, which
would have done probably more to incentivise this, rather than
making employers compulsorily have to pay for training?
Lord Leitch: There was a recommendation
to allocate part of the HEFCE budget towards this, if my memory
is correct.
Q58 Mr Marsden: Would you like to
elaborate?
Lord Leitch: There is a reference
that we should take part of the HEFCE budget and allocate it to
more level 4 qualifications in the work place. Shall we come back
to that?
Mr Marsden: Yes.
Q59 Ian Stewart: Are trade unions
valuable partners in the development and delivery of learning
and skills?
Lord Leitch: Very much so.
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