Examination of Witnesses (Questions 100-111)
Department for Work & Pensions, Learning &
Skills Council and Jobcentre Plus
26 November 2007
Q100 Mr. Bacon: The Report refers
to learning providers who have met quality assurance standards.
Mr. Haysom and I are having an off-line conversation about career
development loans. I do not want to go into that now, because
it is a separate issue, but one issue is common: the idea that
there should be a training provider, with a kitemark, so that
potential providers know that it is okay, because it has the LSC
badge. People have borrowed money and then thought, "Oops,
perhaps the training provider was not so good after all."
We are not in that position here, and I do not want to talk about
career development loans now, but how can people be sure that
the quality assurance standards, and the kitemark that you issue,
are worth it?
Stephen Marston: Under the way
in which we intend to operate skills accounts, you could use it
only with a provider that is quality-assured and funded by the
LSC. Our providers consist of approximately 400 colleges and 800
work-based learning providers. That is the pool of providers with
which you could use your account. If we find that someone not
funded by the LSC wants to take part in the scheme, we will use
that quality-assurance process. For me, that will be the single
biggest change from ILAs to skills accounts: you will not be able
to use your account anywhere that you choose, but only within
a defined set of quality-assured providers.
Q101 Mr. Bacon: Another issue with
ILAs was weak contractual arrangements with Capita—the IT
services provider. Is there an analogous arrangement and set of
contracts with an intermediary supplier, or is the contract with
the training colleges and FE providers only?
Stephen Marston: Certainly not
in the way that we did it with Capita. This is another significant
difference: ILAs were a self-standing programme, and we contracted
Capita to run and manage pretty much the whole operation. Here
we are keeping everything closely integrated within the mainstream
LSC operation. Money will not flow to the account holder; instead,
they will know the value of the public subsidy to which they are
entitled, and go to a provider—a college or work-based training
provider—which will draw down that money from the LSC as
part of the mainstream funding method.
Q102 Mr. Bacon: But the ILA holders
could not draw down real money either. Only training providers
could do that, for which purpose many more were set up. The students
themselves could not draw down the money.
Stephen Marston: But the difference
here will be that the funding method aggregates up the number
of accounts that a given college or provider has, and it will
be paid by the LSC as part of the normal funding system.
Q103 Mr. Bacon: Okay. I have one
other question about this. Paragraph 4.19 states: "The publicly
funded contribution toward tuition costs will be though"—I
think it means through—"secure and tested mechanisms."
What are those secure and tested mechanisms? The bankers automated
clearance system is a secure and tested mechanism, but it allowed
money from ILAs—£2 million in one case—to be
transferred to an account in a Caribbean tax haven with no let
or hindrance. What does the Report mean when it says secure and
tested mechanisms?
Stephen Marston: It means what
I was just trying to describe. What you will have in every case
is a provider with a grant or a contract relationship with the
LSC. The money will flow using those tried and tested methods
that we use now for the LSC to fund colleges and training providers.
So this is not just a BACS system; the whole audit, financial
control and financial memorandum system will be backing up the
accounts mechanism. That is the system that we will use to ensure
that the money gets to the right provider.
Q104 Mr. Bacon: Paragraph 4.18 refers
to pilots that will provide "around 4,000 Learner Accounts
at a cost of £10 million." May I take it that that is
roughly £2,500 each? That is the standard amount per student,
is it? That is how it works.
Stephen Marston: Yes.
Q105 Mr. Bacon: How long will it
be before you are in a position to assess how successful those
pilots have been? Over how long a period will they run before
you can say, "We did those pilots, they're finished now,
and we can evaluate them"?
Stephen Marston: Those pilots
are starting off in parts of two regions and they are testing
the use of accounts at level 3. We are evaluating those as we
go along, and the evaluation programme will be finished in August.
Q106 Mr. Bacon: In August next year?
Mark Haysom: I thought it was
August 2009.
Stephen Marston: Yes, in August
2009.
Q107 Mr. Bacon: Am I right, then,
in thinking that until the pilots are finished, you will not be
rolling the scheme out further? Or will you?
Stephen Marston: It is our intention
to develop the skills accounts programme on a rolling basis so
that it starts at level 3—
Q108 Mr. Bacon: So you have rolling
evaluation effectively?
I have one other question, and the Clerk has
kindly informed that I am running out of time, but I have two
minutes, so you can give a long answer if you want. If there were
one thing that this group of hard-to-employ people could have
that would change their likelihood of being employed—I am
talking not about motivation, but a skill—what would it
be? What is the single biggest skill that they need but which
they lack?
Stephen Marston: Personally, in
terms of skill, I would point to literacy and numeracy.
Q109 Mr. Bacon: That is exactly what
I thought you would say.
Stephen Marston: Is that the right
answer or the wrong answer?
Q110 Mr. Bacon: It was the expected
answer, which has huge implications for every other part of the
system, does it not?
Stephen Marston: Yes, it does.
Q111 Chairman: That concludes
our hearing. Thank you very much for your attendance. I have just
one other point. Could you give us a note on the employment retention
and advancement programme, which is mentioned in appendix three?
You seem to spend £25 million on 8,000 participants, and
I would like you to justify that, please.[8]
Thank you very much.
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