Memorandum 9
Submission from the 157 Group
SUMMARY OF
THE MAIN
POINTS
1. Responding successfully to the Leitch
targets ultimately lies in the hands of the employers not the
providers. The Government needs the key employer organizations
the CBI and the BCCI to be central to the Skills Pledge campaign
shouting the skills message from the rooftops and supporting their
members' engagement. (paragraphs 18, 20)
2. History suggests that compliance comes
before a culture change so it is essential that the Government
legislates to hold compliance powers over sectors that are slow
to train. The powers may not be needed but their existence concentrates
the mind. It may be difficult for that lead to come from the new
UK Commission for Employment and Skills (UKCES) and Sector Skills
Councils (SSC) as employer led bodies. (20)
3. The SSCs need to press ahead with their
flexible and relevant qualification frameworks with a significant
number of employers and providers becoming awarding bodies. Every
SSC should have a provider on their board to ensure that an effective
supply chain dialogue can take place. (22)
4. The Learning and Skills Council and the
Government need to ensure their targets and funding are aligned
to support that flexibility. (23)
5. The Regional Development Agencies and
Regional Skills Partnerships led by employers need to continue
to provide good quality data to monitor progress towards the Leitch
targets and set Regional Economic Strategies which guide and support
the network of skills providers. (25)
6. Local Authorities and key partners such
as large GFE Colleges and DWP contractors should develop realistic
local economic strategies with particular regard to re-engaging
the economically inactive and assisting labour mobility. (26,27)
7. The new Skills Funding Agency should
integrate the Apprenticeship programmes into its wider funding
of Train to Gain as an all embracing package for employers and
dramatically simplify the paperwork involved in the whole employer
engagement process. (28)
8. The public sector should be targeted
to make a significant contribution to the Leitch targets following
the example of the Health Service. (29)
9. It should be recognized that collaboration
as well as competition has a role to play post 19. (31)
10. Large providers can support partnerships
that enable smaller deliverers to meet local or specialist training
requirements. Partnership between public and private providers
should be encouraged and regional operating restrictions abandoned
for quality providers. (31)
11. The provider network needs to meet the
new Training Quality Standard and should be assisted directly
to develop their supply chain capacity following the example of
HEFCE with the University sector. Just as with the broker network
it is unlikely that maximum benefit will come from funding intermediaries.
(32)
12. GFE Colleges should expect to be key
partners in their local communities providing the glue that links
local government and neighbourhoods to the business community
taking on the strategic role currently played by the local LSC
offices. This should be recognized and encouraged by DCLG, DIUS
and the RDAs. (33)
13. Following the FE Sectors success in
exceeding the targets set quality providers should be trusted
with deregulation rather than sector self regulation. (34)
ABOUT THE
157 GROUP
14. The 157 Group was established in March
2006, in response to the recommendation of Sir Andrew Foster in
his report "Realising the Potential". In paragraph
157, he advocates:
"|a greater involvement of Principals
in national representation, in particular those from larger, successful
colleges where management capacity and capability exists to release
them for this work. There is a strong need for articulate FE College
principals to be explaining the services they give to society
and how colleges can make a significant contribution to the economy
and to developing fulfilled citizens."
15. The criteria for membership of the 157
Group include achieving Grade 2 or higher for leadership and management
in the last Ofsted inspection, and having a turnover of not less
than £35 million per annum (although some smaller high quality
and influential colleges will be included).
THE PURPOSE
OF THIS
MEMORANDUM
16. The 157 Group represents large key players
delivering the Skills agenda on behalf of employers and individuals
in line with Government policy priorities. We have a major interest
in ensuring that the structures and responses established post
Leitch deliver a vibrant economy that maintains the nation's influential
position in the world economy and brings prosperity to our communities.
SUPPORT FOR
A DEMAND
LED MODEL
TO ACHIEVE
THE LEITCH
TARGETS
17. The Group fully endorses the proposition
that provision should be demand led; that the employer and the
individual should as directly as possible influence the pattern
and quality of provision. In this context it is important not
to confuse skills with qualifications. We share with government
the view that there are areas such as the first Level 2 and possibly
Level 3 skills where the public good requires interventions to
ensure provision where the market driven by individual demand
might fail. In terms of social equity and economic welfare there
are vulnerable groups such as those with learning difficulties
and disabilities, the unemployed and economically inactive and
ex-offenders where support for an extended period may be required
before such individuals are securely placed on the employment
ladder. The tactical or employability skills need to be taught
alongside the vocational skills.
THE CENTRAL
ROLE OF
EMPLOYERS
18. If the proposition is accepted then
clearly the first duty to develop a highly skilled, productive
and flexible workforce rests with employers. They are responsible
for recruiting and developing their staff. It is their bottom
line that is at stake as well as the nation's prosperity. Clearly
the government, business advisors and providers all need to reinforce
the message that training and skills significantly impact on a
company's success. Key employer organizations such as the CBI
and BCCI need to be fully committed to promoting this agenda.
However high quality, flexible and responsive the supply side
is will be of no avail if there is a demand deficit for skills
upgrading from employers. Therefore the first focus of this memorandum
will be to examine if the actions proposed impact sufficiently
on employers to bring about the step change in training necessary
to meet the Leitch targets.
THE ROLE
OF THE
UK COMMISSION FOR
EMPLOYMENT AND
SKILLS
19. At the pinnacle of the new employer
facing structures is the new Commission for Employment and Skills
supported by eminent leaders from the business community. The
UKCES, which was set up as a result of Leitch, operates across
the UK and plays a central role in raising the UK's skills base,
improving productivity and competitiveness, increasing employment
and making a contribution to a fairer society. Having developed
a view of what's needed, the UKCES will provide independent advice
to the highest levels in the four UK governments to help achieve
those improvements through strategic policy development, evidence-based
analysis and the exchange of good practice. As well as providing
greater employer influence over the employment and skills systems,
the UKCES will promote employer investment in people. So it will
also manage the performance of the employer-led Sector Skills
Councils, advising Ministers on their re-licensing.
20. Will this bring the step change in employer
commitment to workforce development? From the providers perspective
this could become another supply side initiative to improve providers
offer. The key challenge the Committee may wish to put to Chris
Humphries the new CEO is how they will tackle the Leitch challenge
for 2010 to introduce compliance legislation for those sectors
that fail to grasp voluntarism. It is not clear how an employer
led body will be able to step outside the CBI view that the Government
should keep interference with employment practices to a minimum.
21. Will the UKCES be able to influence
the SME sector that needs to spawn the world beaters of tomorrow?
We need the influential players such as the CBI and BCCI to step
up and proactively promote the skills agenda. This would carry
significant weight with their members.
THE CONTRIBUTION
OF SECTOR
SKILLS COUNCILS
22. This takes us to the second group of
influencers on whom Leitch placed a significant burden of responsibility
to transform the skills and qualification landscape. The 157 Group
welcomes the move to empower Sector Skills Councils to work with
employers and providers to ensure the qualification structure
becomes more bespoke whilst retaining coherence and standards.
To ensure an effective dialogue every SSC should have at least
one provider on their board. The structure of QCA and established
Examining Bodies with an effective monopoly over the qualification
structure can now be transformed into a responsive and relevant
instrument for companies and trainers to develop to reflect both
sector and individual employer needs. The challenges that the
Committee may wish to put to SSCs are how they ensure coherence
and portability of qualifications as the number of awarding bodies
increases.
23. The LSC or its successor bodies needs
to ensure that the flexibility in the qualification framework
is reflected in the funding model where public support is available.
There will still be a tension between government targets for full
qualifications and the desire of employers to focus on a narrower
range of skills. This must be resolved if we are to see the full
benefits of this new freedom. The key role of SSCs in the new
diplomas needs to be nurtured if we are to get qualifications
that ensure our pupils leave school or college with employability
skills. These broad employability skills need to be given as much
prominence as the narrowly defined functional skills.
24. Whilst flexible qualifications are a
help they still don't guarantee that all firms will train and
develop their workforce. SSCs are relatively small organizations
who can only communicate directly with a minority of their members.
They need to work through employer networks, trade bodies and
at a regional level perhaps Regional Development Agencies and
Regional Skills Partnerships.
THE REGIONAL
STRUCTURE—RDAS, SKILLS
PARTNERSHIPS AND
THE LSC
25. The Regional Development Agencies give
significant prominence to skills within their Regional Economic
Strategies. Regional Observatories provide quality data about
skills levels and trends in the region. They, together with some
Regional LSCs who provide employment sectors skills plans have
developed, through the Regional Skills Partnerships, Skills Action
Plans. The question to ask the RDAs is who is influenced by these
plans? The perception of the 157 Group is that it is public sector
bodies such as the LSC, Local Government, colleges and perhaps
SSCs (though in the latter case they are more likely to input
to rather than draw on the data). The RDAs have relatively limited
funds to pump prime their strategy. They do however have responsibility
for the business broker network which now incorporates the LSC
training and skills brokers. The brokers regularly interface with
thousands of SMEs across the country. Is this a force that will
transform an employer's attitude to training? The evidence to
date is not strong. Talk to a large number of providers in the
public and private sector and they will report very few broker
leads that have resulted in significant volumes of new training.
They rely on their own employer engagement teams to generate training
business and develop strong supply chain links. This needs to
be recognized in future funding models.
THE PROPOSED
SKILLS FUNDING
AGENCY, EMPLOYMENT
AND SKILLS
BOARDS AND
LOCAL GOVERNMENT
26. The LSC as currently constituted would
have a regional planning role even if a skills action plan didn't
exist. The successor body, the Skills Funding Agency's core function
will be to transfer funds to education and training providers,
increasingly through the demand led Train to Gain and Skills Accounts.
The new agency will work with Employment and Skills Boards where
they exist and with local partners (led by local government) including
Job Centre+ and the new Adult Advice and Guidance teams, to ensure
that employment and skills commissioning is considered within
a local context. This is likely to encompass Local and Multi Area
Agreements with skills and engagement targets. Is this demand
led or planned? Are we in danger of having a number of players
with some confusion and possibly even conflict over their respective
roles? Does this have any relevance to the key relationship between
the employer and the skills and training supply chain? The current
DWP push to hold contracts with a few large organizations may
not do full justice to the value of local ownership of the problem
of economic inactivity.
27. Currently the LSC have focused adult
funding strongly on the achievement of full level 2s and level
3 qualifications. FE providers are not slow to pick up the signals
and the number of such qualifications has risen swiftly. Does
this mean that employers and their workforce are getting the skills
they need to drive up productivity? In some cases the answer is
yes but too often the qualifications are catching up with the
skills that already existed, albeit uncertificated. In Scotland
a rapid improvement in qualification levels has not been matched
by a similar rise in productivity. Planning by regional or local
public sector bodies, particularly if focused on the narrow achievement
of LAA qualification targets may not achieve the required results.
An important emphasis should be on areas of market failure such
as the re-engagement of the economically inactive or coping with
closures and structural change in local employment patterns.
THE NEW
NATIONAL APPRENTICESHIP
SERVICE & SKILLS
FUNDING AGENCY
28. Will the new focused National Apprenticeship
Service (NAS) with its sub-regional teams deliver the step change
in provision that the Leitch and the Government seek? A closer
inspection suggests a structure that has survived largely intact
since the days of the Training and Enterprise Councils with its
own team, enrolment and funding processes which have resisted
integration through the FEFC and LSC regimes. The Skills Pledge
initiative offers the chance to work with employers in an integrated
fashion with Basic Skills, Level 2 and Apprenticeship targets
being looked at as part of an overall employer's HR strategy.
DIUS need to ensure that this vision is not lost in discrete funding
silos and that the Skills Funding Agency ensures that the offer
is seamless from both the employer and provider's perspectives.
THE PUBLIC
SECTOR CHALLENGE
29. The Government has a really big opportunity
with the Public Sector Challenge (a variant of the Skills Pledge)
to raise the qualification levels for a large part of the workforce.
In many parts of the country the public sector is the largest
employer. A substantial part of the Leitch targets can be met
by targeting these big employers. The Health Service have led
the way with the LSC and Department of Health agreeing matched
funding arrangements and workforce development plans for every
Trust and Strategic Health Authority focused on workers in Bands
1-4. These plans are then shared with the local health care provider
network. The Committee would find it enlightening to talk to Bob
Fryer and his widening participation team (now transferred to
the Skills for Health SSC). Local Government could well be encouraged
to follow suit.
THE ROLE
OF GENERAL
FE COLLEGES—PROVIDING
THE GLUE
30. Colleges are key players at the heart
of their communities who can support the local economic and social
strategies linking local government, employers, universities and
job centre+ to transform the skills in their communities. The
larger colleges can do much more as has been demonstrated by Newcastle
College's intervention to secure the future of Carter and Carter's
Apprentice provision. They represent respected and secure not
for profit providers, rooted in their communities who are long
term players with an ethos of quality public service.
31. They can establish strong training networks
in their region linking with other quality providers, large or
small. They can network nationally, either together or in partnership
with large private sector operators to win national contracts.
32. They will offer guaranteed standards
of employer engagement through the new Training Quality Standard
and should be assisted directly to develop their supply chain
capacity following the example of HEFCE with the university sector.
Just as with the broker network it is unlikely that maximum benefit
will come from funding intermediaries. There is a danger that
the "Machinery of Government" changes will perversely
disincentivise colleges to take on post 19 work.
33. They are well placed to take on the
local strategic partnering role that the LSC will relinquish,
with the advantage that they can not only fund but also deliver
the agenda. GFE Colleges should expect to be key partners in their
local communities providing the glue that links local government
and communities to the business community. This should be recognized
and encouraged by DCLG, DIUS and the RDAs.
34. To do this effectively the move to deregulation
needs to gather pace. Care must be taken to ensure that the new
structures do not stifle a reactive and responsive sector. Colleges
are corporations that need to be allowed to grow, develop, merge
and federate as dictated by their business governors in response
to market forces. The performance of the sector in meeting every
government target it has been set should give the government the
confidence to empower its most flexible and responsive education
partners.
April 2008
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