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18 May 2009 : Column 1242

A further disadvantage of being in a rural catchment area is that it is often difficult to achieve the necessary critical mass of students to make a course viable. It might not be too difficult to assemble nine or 10 people who want to study the same subject at the same time and in the same place in a metropolitan area, but it is difficult to do so in a rural area. That means that the college is punished in the sense that it does not get the funding, but there are also fewer opportunities because it cannot achieve the critical mass necessary to realise them. The rurality issue has not been addressed in the funding of colleges of further education.

I said that Craven college was at the heart of the regeneration programme for the Craven area. There is a new campus planned. It is in the third tier of progress; the work is awaiting approval, but the plan is very well developed. It is part of one of the wider regeneration programmes that so many colleagues have mentioned today. In particular, it will incorporate a complex for climbing and caving. That might sound eccentric, but climbing and caving are major tourist attractions in that part of the Pennines and the Yorkshire dales, and a knowledge of those subjects will assist the development of winter facilities and enhance what is a unique selling point economically in the area.

If the activities of the college could be brought together on one site, it would gain through much greater economies of scale in terms of costs and teaching efficiency, and such a move would also make a huge difference to the social environment of the college. It would enable all sorts of interactions to take place between the students that are impossible if they end their day in 11 different places around the town.

So what is going to happen? There have been two recent events, on the first of which I would like the advice of the Minister. Within the past few days, the Learning and Skills Council has offered to pay half the £356,000 fees that have been spent on developing the Craven college project, provided that the head of the college signs on the dotted line by noon tomorrow. Should he sign, or is the LSC offering an out-of-court settlement against the threat of a legal action to recover a greater proportion of the fees, such as I understand some colleges are nurturing?

I have had discussions with Craven college, with which I have dealt in every year since I have been a Member of Parliament, and I have to say that we have not carried the fiery cross around the countryside. We have not said that the college would collapse or that further education in Craven would to come to a halt. We will struggle through, as we have always done. So we are not being alarmist. We are trying to be responsible in dealing with this very real issue, but the head of the college faces a real dilemma over how he should respond to that offer. I pay tribute to the regional staff of the LSC for that offer, because I think they are trying to be helpful.

We have also talked about Train to Gain. Craven college was harried to step up its Train to Gain activities. It was positively cajoled to expand its programme. It has done so, and it was expecting to spend about £1.6 million on such provision up to the end of the academic year that we have been talking about. That money has been stopped in its tracks overnight, and the provision has been capped at some £1 million. There was no warning of that at all. So having gone out to
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employers to persuade them to sign up to the Train to Gain programme, the college now has to go back and say, “Sorry, we can’t deliver on the very programmes that we encouraged you to sign up for a short while ago.”

What is the way forward? We know that the Government have promised £300 million a year in capital expenditure until 2013, and we also know that there are going to be some transparent new criteria based on need rather than on “first come, first served”, with the deadline set for spring 2010—still a long way away. I ask the Minister to ensure that when those criteria are drawn up, there is a fair assessment of rural needs.

Rural needs are not simply an offshoot of a national need; they respond to difference economic and social circumstances, and entirely different definitions of how to be efficient apply in serving the sort of wide rural area that my college serves. I do not want to do down any of the metropolitan areas; we are on the edge of Keighley, and we take students from Keighley as a matter of fact. What I do want to ensure, however, is that there is fair crack of the whip for the rural areas I am talking about. In other words, whether we are judged to have succeeded or not, we want to be able to say that at least it was a fair call and a fair judgment. We want to be judged by meaningful criteria that we are capable of delivering and fulfilling, not against criteria that are designed for entirely different circumstances.

I would ask that all programmes be started from scratch. We should start with a blank sheet of paper and the all programmes that have reached a certain degree of maturity should be examined in the light of those different criteria in the different circumstances. A set of programme priorities should be drawn up that reflect the new criteria—not simply the “first come, first served” basis. If the Government really want the best bang for their buck, if they really want to ensure that their money is being spent as well as possible and if they really want to be assured of value for money, they must do that. If they want to be able to turn around and say they have sorted out an appalling mess in an equitable way so that people feel that fairness has been applied to all sections of the country in all the different circumstances of the country, that is what they should do.

I hope that the Government will be fair in addressing those problems. I have not gone into too much detail today, as we will be joining the long procession of people intending to meet the poor Minister—he will be able to do a “Mastermind” on colleges of further education, I suspect, in a couple of months’ time—and we can provide the detail then. If the Minister does what I have suggested, Craven will continue to give him, as it has always has done, the biggest possible bang for the buck. The benefits will then be spread over a huge area of rural England.

5.47 pm

Hugh Bayley (City of York) (Lab): It is a great pleasure to follow two other Yorkshire Members in this debate.

Our country is in the middle of an extremely severe recession—the first global recession since the 1930s. It is global in the sense that, for the first time since the 1930s, global output is likely to fall. This recession, as we all know, was triggered by the sub-prime mortgage crisis in the United States. It spread quickly around the world because of the globalised nature of the banking
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and financial services sector these days, and it was amplified by light-touch regulation in this and other OECD countries. One of the lessons to be learned from this recession is that the Thatcher-Reagan doctrine that private institutions are always best regulated by themselves rather than the state has come to an end. I do not want more regulation, but I do want smarter regulation so that the lessons of the recession are learned.

Before I turn specifically to deal with further education, let me say that I chair the Economics and Security Committee of the NATO Parliamentary Assembly. The week before last, our committee was in Washington DC to meet the International Monetary Fund and the World Bank to discuss the recession. They predicted that, from the peak to the trough of the recession, global output is likely to fall by 3 to 4 per cent. They also say that if Governments such as ours and other OECD Governments had not adopted fiscal stimulus packages, global output would fall by something like 9 per cent.

Let me explain the difference. If global output falls by 3 or 4 per cent., it will mean a very severe recession—more severe than any since the second world war. But if output falls by 9 per cent., we will be in the territory that existed between the two world wars when there was a decade-long depression and unemployment soared for years at a time. The fiscal stimulus is a necessary response and it is right to put Government funding behind education and training, particularly vocational training. I was pleased to see hundreds of millions of pounds being set aside in the Budget for that purpose.

It is extremely important to invest in skills—both in vocational training and in broad liberal education—so that we see benefits in our national economy and so that individual citizens in our country see the benefits of jobs and job security. It is important to do so now, so that the country benefits when the upturn comes. We do not want to make the same mistake as was made when the Conservatives were in power and people were simply parked on benefits during the recession, without the funding for training, and vocational training in particular, that we have at the moment.

During the 12 years that the Labour party has been in government, a strong platform has been created within further education to provide the skills training that we need. In my constituency, in 1996-97, some £12.1 million was allocated to York college and the York sixth-form college, which was a separate institution. Since then, the two have merged, and in 2008-09, the budget was £20.5 million—an increase of £8.4 million, or 69 per cent.

It is not just in York that additional resources have gone into further education. There are eight colleges in York and North Yorkshire. Two are specialist colleges—Henshaws college, a specialist college in Harrogate that provides education and training for people with visual impairment and additional physical or learning difficulties, and Askham Bryan college, one of the largest land-based colleges in the country—and there are six more general further education or sixth-form colleges. Between them, and including Craven college, which the right hon. Member for Skipton and Ripon (Mr. Curry) spoke about, they work with some 50,000 young people and have a combined turnover of £70 million a year.

In the past five years, the Government have allocated some £80 million of capital to improve the colleges. They have partnerships with almost 10,000 businesses
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and train some 7,000 employees a year. They have degree and higher-level programmes for more than 2,000 students. The colleges in York and North Yorkshire educate nearly 12,000 16 to 18-year-olds—more than all the school sixth forms in York and North Yorkshire put together.

It is important to have the right balance of numbers to guarantee choice for young people at the age of 16 between courses and between settings—school and further education. The two Departments—the Department for Innovation, Universities and Skills and the Department for Children, Schools and Families—need to talk further about how the school sixth form presumption works. In 2007-08, which is the latest year for which I have figures, there were 4,129 16 to 19-year-olds from York in college and 1,079 in school sixth forms. Each individual 16-year-old has a choice about whether to attend one of the five schools in York that has a sixth form or to go to York college, or indeed one of the other colleges, such as Askham Bryan or another further education college close to York.

The schools provide continuity and familiarity for the students. They are smaller and, as a result, provide a narrower range of subjects. They provide extremely good education. York college, like the schools, achieves excellent A-level results, but its curriculum provides about 40 subjects, including a full range of modern languages, which none of the school sixth forms can provide; specialist subjects such as archaeology and ancient history, which have a particular purpose and which we have a need for in a city such as York; and specialist art courses such as photography. Indeed, Freddy Bulmer, an 18-year-old at York college, has just won first prize in the national Colleges on Camera competition. His winning photograph shows the impact that the £65 million investment by the Government and the college in the new York college has had on him and his fellow students. It is good to see excellence coming from a further education college.

Perhaps I should tell hon. Members that four years ago, after the general election, I did what I usually do after elections—commissioned a local artist to make a limited-edition print to celebrate life in York. The artist I commissioned on that occasion was a young man from York college, Michael Kirkman, who produced a fabulous print of building work at York hospital. That was his choice of subject, which he felt summed up the type of life that people live in York now. I am pleased to say that one of his prints is in the collection of York art gallery while another hangs in the boardroom of York hospital. Several others hang in GP surgeries around the city—it is marvellous work. That, again, shows that colleges can provide excellence at the highest level.

Recently, Archbishop Holgate’s school used the sixth-form presumption to establish its own sixth form. There were concerns from other 16-to-18 educational providers in the area that it might dilute provision elsewhere. There were discussions between the head of Archbishop Holgate’s school—an old and venerable institution headed by John Harris, who is a head teacher I respect enormously—and the local education authority. They agreed that there was already good level 3 A-level provision in York, but that more level 1 provision was needed for the 4 or 5 per cent. of students who are not
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in education, employment or training. Archbishop’s sixth form is making a real contribution in that field, focusing on the needs of the NEET group and of young people aged 16 to 18 who have disabilities.

However, there are other schools—good schools—in York seeking sixth forms. If they were all to take individual decisions, we could end up with poorer 16-to-19 provision overall. There is a tension between school choice on the one hand and the LEA’s commissioning role on the other. I believe that a different balance is needed on who can take a decision. The Government’s decision to give LEAs responsibility for further education and schools will help a new balance to be struck.

It is important for the Government and LEAs to recognise that learner choice is not the same as school choice. We need learner-centred provision so that young people in York and the surrounding area can choose between school or sixth-form college and between a wide range of subjects—not just A-levels, but vocational provision.

I also want to say a word or two about the discrepancy in funding between school sixth forms and further education. School sixth forms receive a premium of about 5.6 per cent. If York college received the same funding as school sixth forms, it would get about £900,000 more per year. Quite quickly, as I have been raising the matter for several years, I would like to see that gap being closed. It is more likely that that will be achieved now that LEAs have responsibility for further education as well as schools.

I congratulate the Government on their capital funding for schools and for colleges. In 1996-97, schools in York received capital funding of less than £1 million a year. In the 12 years since then, they have received, on average each year, more than £10 million—a tenfold increase for York’s schools. As I said, we have a brand new York college, built at a cost of £65 million, more than £20 million of which came in the form of Government grant.

Once again, however, there is a gap between the capital regime for further education and that for school sixth forms, which receive 100 per cent. capital funding whereas further education does not. In order to build a new college building, York college had to borrow some £4.5 million on its own account, and a proportion of its general income is used to pay back that loan. Schools do not pay VAT on services and equipment, but colleges do. Although both school and college-goers receive the education maintenance allowance, which is an important Labour innovation because it makes it possible for people from low-income families to continue in education after 16, in schools young people from low-income families also receive the benefit of free school meals, which are not available in FE. If one takes all the funding differences together, the gap is not 5.6 per cent., which is what the Government acknowledge, but rather more—possibly as much as 15 per cent.

Colleges admit a greater proportion of students from disadvantaged neighbourhoods. Some 29 per cent. of those in FE come from such neighbourhoods, compared with 19 per cent. of those in school sixth forms and, for comparative purposes, some 20 per cent. of those in universities. It is important that students from more disadvantaged neighbourhoods get the same quality and level of funding as those in schools, and LEAs must address that.

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I should say a word in response to what the Conservative spokesman said about the problem of overstretch in the Building Colleges for the Future budget. York is very fortunate to have its new college, and I want other people, such as those in Barnsley, to have that benefit, too. I have tabled an early-day motion expressing my concern about the cuts in Building Schools for the Future, and I urge hon. Members to sign it. It makes the case for increasing Government funding for FE capital projects. In an economic downturn, there is a strong case for investment in public infrastructure.

I regret that the Conservative spokesman did not welcome the level of investment that the Government are putting into colleges—some £2.6 billion in the current spending period. I see that he is coming back into the Chamber, and I hope that he will commit to a fiscal stimulus package to counter the recession, including further investment in further education.

6.2 pm

Sir George Young (North-West Hampshire) (Con): I commend the hon. Member for City of York (Hugh Bayley) for his tradition of commissioning an important work of art from a local artist following his election to Parliament. I am sure that his successor will wish to follow that tradition.

I want to drag the debate south from Yorkshire, where it has been for the past three speeches, to Hampshire, where it began with an excellent speech by my hon. Friend the Member for Havant (Mr. Willetts). I wish to pick up the point that the hon. Member for City of York and my right hon. Friend the Member for Skipton and Ripon (Mr. Curry) made about the fiasco of the Building Colleges for the Future programme.

Many of us took part in a debate in Westminster Hall in March, when the Under-Secretary of State for Innovation, Universities and Skills had an uncomfortable 90 minutes being beaten up by Members of all parties. If I may give him some respectful advice, perhaps his response to this debate might be less pugnacious than it was on that occasion and a little more constructive, bridge-building and conciliatory. Whereas other Ministers have come to the House and told us that they are bringing forward the capital programme for counter-cyclical reasons, he has had to tell us of a freeze in the further education capital programme with projects, far from being brought forward, being indefinitely postponed.

Two years ago Cricklade college in Andover merged with Sparsholt college, just outside Winchester. Thanks to the energy and commitment of the principal, Tim Jackson, and his team, the quality of education in Andover has been driven up since the merger. They are doing a fantastic job in challenging circumstances, but they have not been assisted by recent events. At the time of the merger, the LSC wrote to me:

It went on to say that those figures were indicative at that stage, but concluded:

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