Memorandum 25
Submission from the Council for Industry
and Higher Education (CIHE)
EXECUTIVE SUMMARY
1. The Council for Industry and Higher Education
(CIHE) is pleased to offer the following input to your inquiry
"into how responses to the agenda set out in the Leitch Report
will affect the broader structure of further and higher education
and lifelong learning."
2. We do so from the premise that the UK
has to up-skill those in the workforce as well as develop more
enterprising and employable graduates—the fundamental belief
in the Leitch review. Equally we are clear that a highly skilled
workforce is a necessary but not sufficient condition for business
success. Employers need to be ambitious and demanding in the strategies
they set for their businesses. High value-adding strategies backed
by investment in new knowledge will pull through a demand for
high level skills. The Government's innovation and skills strategies
are therefore linked. Universities and colleges can help organisations
reposition themselves through knowledge exchange as well as through
the supply of skilled graduates, post-graduates and learning for
those already in work.
LEITCH AND
HIGHER LEVEL
LEARNING
3. The Leitch Review had twin aims that
created an internal tension. These were to consider the learning
and skill needs appropriate in the face of ever increasing global
challenges notably from Asia, and to consider how to address the
skill needs of those who currently have low levels of qualifications
especially in maths and English. The result was a report that
was strong on the latter and on up-skilling to levels below higher
education but weaker on the former. However, its analysis on how
the jobs of the future will increasingly require higher levels
of learning and its recommendation that at least 40% of the working
population should be qualified to level 4 (HE) by 2020 were extremely
important.
4. Generally it was weak on the roles of
higher education in raising the capabilities of the workforce
and building the knowledge intensive and high value-adding economy
we need to face the global challenges. What it did say was founded
on a questionable presumption that employers think in terms of
levels and qualifications. Hence it underplayed the substantial
changes needed to establish in England[74]
a comprehensive system of learning credits and funding by credits
as well as the quality and other frameworks needed to support
universities and colleges to engage in work-based learning.
"WORLD CLASS
SKILLS"
5. The Government's initial response in
World Class Skills [75]
displayed the same tensions as were evident in Leitch. It also
seriously underplayed the need to up-skill a workforce that can
only compete with Asia on the basis of higher level learning,
enterprise and innovation.
6. Hence the report had little to say about
the development of higher level skills or management and leadership.
HEFCE funding for just 5,000 additional student numbers (ASNs)
in 2008, 10,000 in 2009 and 15,000 in 2010 should be seen as just
a holding response. There are some 23,000,000 who are in the workforce
and 70% of these have had no assessed experience of higher level
learning. We need tens of thousands of learners every year rising
to hundreds of thousands per year to have their existing learning
assessed and then upgraded if organisations are to have the capacity
to absorb knowledge and reposition themselves against global competition
as rightly envisaged by Lord Sainsbury in his report The Race
to the Top[76]
and in the DIUS Innovation Nation report of April 2008
7. HEFCE will also want to rethink the notion
of ASNs. Offering ASNs is appropriate to full-time or part-time
courses where there is a substantial amount of learning over a
year. For bite-sized learning where the credit rating may be uncertain
at the start and/or may be only 10 to15 credits, it is less appropriate
and could be excessively bureaucratic for HEIs to agglomerate
the learning to FTEs. It may not prove attractive if the learner/employee
has to pay fees and the employer half the cost of the provision
(as stated in the HEFCE guidance letter to HEIs 04/2007). We need
to make the process as attractive as possible to all parties.
HIGH LEVEL
SKILLS STRATEGY
CONSULTATION DOCUMENT
8. We welcome the thrust of the recent Government's
Higher Education at Work consultation document[77].
We agree that this high level skills strategy complements the
DIUS Innovation Nation and the BERR Enterprise Strategy and that
a key aim has to be "to raise the skills and capacity for
innovation and enterprise of those already in the workforce".
9. The commitment in the new DIUS consultation
document to drive towards an approach built on credits is particularly
welcome. Small businesses in particular cannot release staff for
long courses at universities or colleges and many people want
to take one step at a time down the learning road. They want learning
in small chunks delivered at times and in ways that suit them—often
in the workplace or at evenings or weekends. They do not necessarily
want to have to go to an institution. They may want the learning
they have already acquired in the workplace to be assessed and
accredited. They may want to build up credits towards a range
of awards such as certificates, diplomas, two year degrees or
MBAs.
10. Credits also help those learners from
non-traditional backgrounds get a taste and drop in and out of
learning. Currently if you do not finish a whole course of study
you and the university or college are classed as failures. In
fact a person may well have learned a lot and benefited even though
a year long course could not be completed all at once. They might
like to return later and the credit route makes that possible.
11. The Higher Education at Work consultation
document states[78]:
"For the first time, we now have a clear
timetable and prospect for nationwide credit arrangements to be
in use in higher education. By 2009-10, HE institutions should
have credit-rated their main provision and be publishing details
in the descriptions of the programmes they offer. This more consistent
and transparent approach to the use of credit will encourage learners
and aid progression."
We urge the Select Committee to press the Department
on the need for a credit based approach to high level learning
as the key to engaging businesses and individuals in lifelong
learning and progression.
THE IMPORTANCE
OF CREDIT
FRAMEWORKS
12. While there are regional consortia[79]
we need a system-wide approach that embraces all the players:
universities, colleges, private sector providers and in-house
provision. England has nothing equivalent to the Scottish Credit
and Qualifications Framework. Each sector has its own architecture
and nomenclature of levels; and in neither has credit been fully
adopted as a measure of transferable learning. While some universities,
mainly post `92, do use and accept credit transfer, this is not
generally the case with the pre-'92 universities. There is little
here, and elsewhere, to compare with the currency of credit in
the American system across diverse institutions and the amount
of mobility afforded to (and taken by) its students as a result
of the centrality of credit within State-wide systems.
13. Lifelong Learning Networks were established
with the main aim of constructing local vocational pathways to
HE. In their relatively short lives, they have gone some way to
addressing this issue through the development of Progression Accords.
However, these local arrangements are often between one course
at one College and one particular course at one University. As
Lifelong Learning Networks come to the end of their lives, what
will be their lasting legacy?
14. If we are serious as a nation about
enabling learners of all ages and backgrounds to develop higher
level skills, to acquire learning when and where it suits them
and to explore and progress around the climbing frame of learning,
then systems of credit accumulation and transfer have to be implemented[80]
and be made compatible across the country. Individuals need to
be able to have the learning and skills they have acquired in
the workplace validated and credited, go on an in-house or external
course whether provided by a private sector provider, a College
or an HEI and build further credits.
15. New initiatives on a sub-regional basis
such as across learning providers in Manchester offer potential.
In the Thames Gateway all of the HE and FE institutions have signed
to support a guarantee of progression for all with a level 3 qualification.
This commitment is indeed an important part of the Thames Gateway
Plan. "But generally UK hierarchies have mitigated against
federal FE/HE structures and Government/HEFCE incentives are needed.
LLNs simply do not go far enough. Despite getting a lot of their
students from FE, many pre-92s keep FE at arms length for fear
of dumbing down by association."[81]
By contrast we note that credit and credit transfer lies at the
heart of the Community College and university systems in many
US States[82]
and that all of Hong Kong's top rated Universities have an FE
college within their governance[83].
16. The moves under Bologna to develop an
EU wide European Credit Transfer System (ECTS) credit and transfer
system offer a way forward that international employers want to
see implemented as soon as possible. All universities and colleges
will want to consider how they might best work together to learn
from the best practice in the US, implement ECTS and make credit
frameworks central to their provision. We have to help learners
transfer their learning when they transfer their job. We have
to help them build their learning from all learning sources including
on-the-job practical learning. We have to help learners value
every step they take down a learning road and stop classifying
those who "stop out" as "drop outs". An English
credit framework can help enormously with these aims.
We urge the Select Committee to stress the need
for a comprehensive qualification and credit system in England
along the lines of that already in place in Scotland.
FOUNDATION DEGREES
17. When first announced, the Foundation
Degrees (FD) was described as akin to the American Associate Degree.
But it has always tried to face in two directions. It is required
to function as a transfer qualification (offering progression
to the final stages of the bachelor degree) as well as a complete
qualification keyed to the needs of employers in specific occupational
areas. The emphasis given to the transfer or the exit function
has varied with universities being more interested in the latter
and the preservation of their supply chain than in it being a
terminal award that would meet the skills gap at supervisory and
higher technical level. The tensions inherent in this dual role
became particularly open when the Government announced that future
expansion would be at FD level. Those universities that saw themselves
in that FD market were naturally keen to preserve and expand their
offerings even at the expense of local Colleges. Foundation Degrees
also lack the broad base of the US Associate degree and are specifically
aimed at skills development in a way Associate degrees are not.
This in turn may affect transition as some HEI third year programmes
are based on broad approaches in years 1 and 2 thus creating the
bizarre position where some FDs may be too focused on employer
need to afford easy progression.
18. High performing colleges should be at
least as well-placed as certain business facing universities to
contribute to the growth and development of foundation degrees.
Indeed, where they have a particular vocational niche they may
be the most appropriate player with the credibility and understanding
to develop such awards. Some learners may welcome the local nature
of their College or do not want to be constrained by an academic
year and timetable. Currently, 140 FE Colleges are directly funded
by HEFCE to deliver HE. The Government agrees that direct funding
might be appropriate in some instances where niche provision is
offered or where there are no obvious higher education partners.
Understandably colleges seeking additional funded numbers must
also meet criteria including critical mass, their track record
on quality and standards, and the nature of such provision. The
Further Education and Training Act 2007 enables those Colleges
who have major provision of higher level learning to award their
own Foundation Degrees.
19. But generally Colleges are now expected
to develop Foundation Degrees on the basis of structured partnerships
with universities where they are funded indirectly through franchise
or consortium arrangements. Such partnerships, the government
argues, can help stimulate demand for the Foundation Degree and
establish its currency. But Colleges have to rely on their HEI
partner to accept their proposal for a Foundation Degree and not
submit a competing one when student numbers from the school leaving
cohort is about to turn down. There is every incentive for universities
to squeeze out foundation degree provision by Colleges. Regional
Development Agencies (RDAs) might have a role in brokering partnerships
between universities and colleges to see how they can be built
on a mature appreciation of the strengths that each side can bring.
20. Up to 72% of FDs are reportedly delivered
in Colleges which have a presence in areas where there are no
local universities or none interested in FDs. Colleges also have
close associations with businesses, a track record in widening
participation and encouraging progression and an apparent ability
to deliver at competitive rates.
The select Committee might like to question
the Government on its policy stance and the priority it attaches
to the delivery of high level learning by Colleges as well as
Universities.
FUNDING COLLEGES
21. Roughly 140,000 students are taught
on prescribed courses at higher education level in Colleges[84].
Some 140 colleges are funded directly for their prescribed higher
education by HEFCE. Funding for the significant amount of "non-prescribed"
higher education geared to professional qualifications comes from
the Learning and Skills Council which historically has had a focus
(driven by Government priorities) on the development of lower
level skills and qualifications.
Might the announced demise of the LSC and its
replacement by a new Skills Funding Agency (so far as adult learning
is concerned) be an opportunity for all higher level learning
to be funded by HEFCE?
22. The Select Committee might like to probe
on why there does not appear to be much enthusiasm in Government
and HEFCE for this proposition. Such a unified approach to funding
high level learning might make it easier for an integrated view
of skills (ie integrated across levels) to be taken by RDAs as
skills brokers. LLNs, HLSPs and Aimhigher have all reinforced
the role of the RDA as planning bodies and this has been reinforced
by placing Business Link with the RDAs.
23. An aspect of plural funding arrangements
is that the regulations governing prescribed higher education
in Colleges do not allow these institutions to receive direct
funding for short and flexible forms of provision, such as might
be required by employers to enhance the skills and knowledge of
their workforce. Funding for this kind of provision is allowed
and available to higher education establishments. In these circumstances,
colleges could seek indirect funding for such work but, as in
all franchise relationships, some of the funding would be retained
by the higher education institution to meet the costs of its quality
assurance. Unit delivery can already be done with indirect funding.
But directly funded colleges are unable to offer anything other
than whole courses, thus hampering their flexible response to
business need.
The Select Committee might like to probe the
logic of this distinction. Do the safeguards on quality and the
need for colleges to set out and justify their strategies for
the delivery of higher level learning justify a change of approach?
STIMULATING BUSINESS
DEMAND
24. The key to achieving the aims set out
in the Leitch Review and reiterated by the Government in Higher
Education at Work will be the reaction of businesses.
25. We suggest that the Select Committee
might like to note the lessons learned in Scotland. We agree with
the statement in the Scottish Government's report Skills for
Scotland[85]:
"Simply adding more skills to the workforce
will not secure the full benefit for our economy unless employers
and individuals maximise the benefits that they can derive from
these skills. Furthermore, how skills interact with the other
drivers of productivity, such as capital investment and innovation,
is crucial."
26. We suggest that it will be ambitious
employers who realise that they have to reposition their businesses
for a more knowledge intensive age who will pull through a demand
for high level skills. Organisations are unlikely to demand more
skilled people without changing their business strategies, their
products, processes and management styles. Scotland has for many
years had levels of higher education participation amongst young
people considerably above those in England. But in the absence
of organisations able to absorb them, offer them graduate level
jobs or free them to transform the organisations they join, many
have either drifted south or remained as a wasted resource in
non-graduate occupations. GDP and productivity has lagged that
in England despite the high output of graduates.
27. Businesses have to be helped to add
greater value in what Lord Sainsbury has rightly called "The
Race to the Top"[86].
Government can help most through the power of innovative public
purchasing. The Government spends some £150 billion per year
on procurement against some £10 billion on research. If just
2.5% of the former encouraged small businesses to be more innovative,
link with universities and upgrade their capabilities, that would
represent an injection of some £3.75 billion[87].
That compares with the £150 million that the Government intends
to inject via the supply side of universities in knowledge transfer
under the Higher Education Innovation Fund (HEIF 3) in 2010, £350
million going to the Technology Strategy Board (TSB) for their
business led activities and perhaps £100 million from HEFCE
for delivering Leitch.
28. There is an increasing recognition that
the future competitiveness of the UK rests on continuous innovation[88].
It is innovation that will drive businesses to be more
knowledge intensive, to add still greater value to the products
and services they offer and the management practices they use
in their quest for international competitiveness. It is this repositioning
that in turn will drive the skills agenda and make
it necessary for the organisation to recruit more highly educated
people and up-skill their existing workforce. The DIUS innovation
agenda will drive the realisation of the Leitch agenda.
29. Currently we know little about the demand
from businesses for higher level learning[89].
HEFCE is funding a number of mostly post-'92 universities to pilot
a range of approaches and specific projects. The Government is
funding three Pathfinder regions in the NW, NE and SW to the same
end. But it will take some time before it is possible to assess
what works and why, whether the small scale initiatives are scaleable
and on what conditions[90]
and before a range of co-funded pilots at the local and sector
levels enable us to assess the range of options that might work.
30. The Government's preferred approach
appears to be to rely on an expanded Train to Gain brokerage service
to build relationships between businesses and learning providers.
"The commitments in the Train to Gain Plan for Growth will
ensure that Train to Gain provides an advice and referral service
which truly meets employers' high level skills."[91]
This is high risk as the service is unproven at HE level and the
experience so far in the NE is that brokers have had only limited
success at bringing in new learners at HE level. We would prefer
to see a range of approaches including via Sector Skills Councils
and through expanding the business focused expertise that exists
in HE and FE institutions—including through an expanded
HEIF allocation. Universities and colleges are well placed to
understand not only what it is feasible for them to provide but
also their local markets. They need to be encouraged to augment
their market knowledge and focus. A range of appropriately funded
approaches will be needed to raising business and individual learner
demand.
31. We welcome the roles that Sector Skills
Councils (SSCs) have to engage more in working to help their businesses
articulate the high level skills they consider they need. SSCs
are business organisations much more than RDAs and should be the
main route through which business demand is articulated. Equally
RDAs are largely artificial geographical constructs. Universities,
colleges and businesses work across such boundaries. So while
RDAs are useful in pulling together regional and local partnerships
both from the supply and demand side, it is our view that business
led organisations must take the lead. As we noted above, Local
Learning Networks have had only limited success and there is no
reason to believe that RDAs will be more successful at dealing
with essentially sector focused learning needs.
The Select Committee might like to probe the
Government on how far the innovation agenda will drive the skills
agenda, the linkages between the two and how far available funding
focused on stimulating innovation and enterprise might bust pull
through a demand for higher level skills.
The Select Committee might consider whether
business demand is most likely to be articulated and driven forward
by business led organisations such as the SSCs rather than organisations
such as the RDAs and whether resources should be allocated accordingly.
April 2008
74 A credit and qualifications framework exists in
Scotland while Wales has a system of funding by credit. Back
75
DIUS 30th May 2007 Back
76
HM Treasury 2007 Back
77
DIUS April 2008 Back
78
cf Para 7.9 Back
79
The Greater Manchester Strategic Alliance which incorporates all
universities, colleges and some other key players is particularly
promising in being extensive and inclusive Back
80
There have been many attempts to implement such schemes; see eg.
the INCCA Report for the then DES in 1999-2000 chaired by Dr Geoffrey
Copland and supported by the then Minister Tessa Blackstone Back
81
Private communication from a recent CIHE Vice-Chancellor Back
82
CIHE forthcoming publication on US and UK colleges Back
83
Professor Sir David Melville communication Back
84
Roughly 100,000 students are taught at levels below higher education
in HEIs-largely in what were previously Colleges which have been
absorbed into universities. Back
85
The Scottish Government September 2007 Back
86
HM Treasury November 2007 Back
87
The 2.5% figure reflects the US Government's approach under Federal
public procurement policy deployed under the SBIR/STTR schemes.
The CIHE report Using Public Procurement to Stimulate Innovation
builds on the support for this approach in the Sainsbury
review and makes specific recommendation on how US experience
can inform the practical steps that now need to be taken. Back
88
See also International Competitiveness: Businesses working
with UK Universities, CIHE 2006 Back
89
See the summary of available evidence in Workforce Development:
how much engagement do employers have with higher education?
Madeleine King, CIHE March 2007 Back
90
See however an interim assessment Workforce Development: what
works and why; Helen Connor, CIHE July 2007 Back
91
DIUS op cit Para 7.4 Back
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