Examination of Witnesses (Questions 140-151)
MR MARTIN
DOEL, MR
GRAHAM MOORE
AND DR
JOHN BLAKE
20 MAY 2009
Q140 Chairman: This is the April
meeting?
Dr Blake: Yes. I think it was
a good start. I feel that the new regime in LSC terms is heading
in the right direction, without sounding patronising.
Q141 Chairman: Can I interrupt, were
the minutes of that meeting published?
Dr Blake: I do not know if they
have been published. I have certainly had a copy. I am not sure
of the status but I can check that.
Mr Doel: The minutes were published
in conjunction with the LSC.
Q142 Mr Boswell: When is your next
meeting, because that was only three weeks ago?
Dr Blake: I think it is mid-June.
There are some dates being canvassed at the moment, after the
LSC meets on 3 June to decide on this first phase of money. I
think they have made a good start in terms of being more open
and more transparent and more involving. They have still got to
produce some of the evidence that has been asked for but at least
it has been said that it will be produced. They were talking at
the first meeting about the process to be used to decide how the
extra money that is available this year will be allocated on 3
June at the National Council meeting. It was an objective process.
It was much more needs-based than previously. I think if a number
of colleagues have got a concern it still has the risk of being
about first-come, first-served, which is what we feel has happened
so far. Shovel-ready basically means you have to have been lucky
in the capricious process that got you this far in the LSC capital
funding process to date so the 30 or 40 colleges who were successful
may not be the most needy but they may be the ones who just happen
to be ready this August.
Q143 Chairman: Sir Andrew Foster
makes that clear in his report, this lack of prioritisation and
in fact the issue that Gordon Marsden has been particularly interested
in, the regional prioritisation as well, because there are two
dimensions to this. Is this new capital group actually looking
at the multi-dimensions of delivering a programme?
Dr Blake: Yes, they are making
big strides in the direction of having a needs-based system in
the way that you describe, but they are dealing with the residue
of a system which was not like that, so there is lot of gear changing
going on at the moment. I think it will be better in phase two—and
phase two is dealing with all the other colleges who are not successful
on 3 June—and I think that a more logical, needs-based,
regionally assessed process will come out of that. Of course,
there is no guarantee of any funding for phase two at all at the
moment and I suppose the biggest concern of colleges who are at
the Reference Group is where will the funding for phase two ever
come from? The other concern—and this is being addressed
at the next meeting—is the costs. The £200 million-plus
that has been risked with no guarantee of success is going to
be talked about at that meeting in terms of a process for paying
colleges back in some way. That is positive.
Q144 Chairman: I know you want to
comment here, Martin, but could you also address the issue of
what I call "overhang" from existing programmes and
whether in fact the stuff which the Capital Reference Group are
now trying to deal with is actually including the overhang from
a programme where clearly the cash flow was going badly wrong?
Mr Doel: First and foremost, you
need to understand the role of the Reference Group. It is to inform
the criteria that will be used. It is not to have one set of principals
judge upon another set of principals' projects to see which will
go forward. It is to produce an objective set of criteria and
to inform that process so that they are applied in a way that
is fair, transparent and can be seen to be proper.
Q145 Mr Boswell: So it is a kind
of working party to draw up a series of guidelines?
Mr Doel: For the criteria and
the process, not to judge individually between the programmes
because I think that remains the duty and task of the agency appointed
by government in order to spend the monies.
Q146 Mr Marsden: That is the lobster
pot really into which DIUS tried to draw you originally which
you resisted?
Mr Doel: I think it would be inimical
for a representative and membership organisation to be judging
between each of its members in terms of where funds and resources
ought to go. Quite clearly throughout this I have been saying
that our role is to inform the process and, if necessary, challenge
that process but not to carry out the process, so in that sense
it is not deciding how the money will be spent, it is deciding
on the criteria that will be applied to how that money is spent.
In terms of overhang, I think this manifests itself in terms of
the money that will be available on 3 June to be allocated, it
will depend on what overhang exists already, and what funds are
available in order to pay for new projects to start. In terms
of the overhang, it is not visible or transparent to me how much
overhang is being carried forward. The line will be how much money
there is for allocation on 3 June. As John has said, the next
thing we really do need to think about is what happens to all
of those colleges that do not receive the go-ahead or the prospect
of going ahead? The word we have so far is that there will be
no new starts on current plans until 2011, and funding for that
is uncertain. There will be a considerable period of another hiatus
here and what we are very concerned to ensure is that, first of
all, costs remission occurs in that period so that colleges can
identify their own way forward and have some certainty in terms
of what they plan there, but also what we have been arguing for
is a small amount of money for a capital innovation fund so that
people can find alternative means of funding their projects in
the meantime, perhaps on a scaled-down size or through refurbishment,
in order to meet their essential and immediate needs, and in order
to respond to the demands that have been placed on them in the
face of the recession and 16-19 growth and other factors that
apply. It is a long period from now through to 2011 if there is
no prospect of moving a significant number of these projects forward.
Q147 Mr Boswell: I think I have understood
this but I just want to be clear. What you are saying is that
notwithstanding the criteria which are now being developed by
the Capital Reference Group the monies which are available are
likely to be required to deal with the overhang and that whatever
the pressing needs of a new project, at least on the face of it
so far, new projects could not be initiated for another two years
in effect?
Mr Doel: The amount of money that
is going to be used on existing projects going forward is still
not transparent to us, so we do not know how much of the monies
within the LSC's gift currently will have to be allocated to that
and how much will be available for new builds.
Q148 Mr Boswell: But the inference
is that new build, as it were, from cold without a previously
presented project, may well have to wait a couple of years?
Mr Doel: As presented now and
our view within the Capital Reference Group is that there is unlikely
to be any further funding allocated until 2011. That may not prove
to be the case because there might be economies found with existing
programmes and existing works and as funds become available they
may be released earlier than that, but what I am concerned about
particularly—and I think all of us would be—is what
happens after 3 June for those colleges that are not, if you like,
in the mix immediately for the allocation of funds? They need
to have some clarity and transparency to release what is the innovation
within the sector to find alternative solutions to the issue that
they face.
Q149 Mr Marsden: I agree that it
would be invidious for the AoC to comment on individual projects
in the way you described it, and I take what you say about the
Capital Reference Group and the provisional nature of what it
is doing, but does the AoC agree with what Foster says in his
conclusions across the sector that a key element for these criteria
must be the regenerative effect and context of the proposals that
come forward?
Mr Doel: I think that is as acknowledged
by the Capital Reference Group and as by the criteria that are
being applied that is one of the factors that is being taken into
account, and I think that is right. Weighting between factors
will always be an issue. Others might say, "If my building
is falling down and I cannot teach my students next year, even
though that is not a regenerative effect is also a factor,"
so these are a complex mix of factors that will apply.
Q150 Mr Marsden: I understand that,
but what I am just trying to get out of you is that the AoC are
not holding to the principle, I want to be absolutely clear, that
first-come, first-served and shovel-ready should be the guiding
principle as to where we go now?
Mr Doel: Absolutely not and I
have made known my concerns both to DIUS and also to the LSC about
the requirement to be shovel-ready and the money being applied
only on that criterion at this stage.
Mr Moore: May I just add to that
that I think the LSC under Geoff Russell's leadership fully understands
the needs-analysis that needs to go on and about the educational
case being paramount. There are property issues which have to
be taken into account. The 157 Group would argue also that it
is not about a little bit for everybody, it is about proportionality
to reflect the size of the task that you are being asked to do
by the Government to serve the community. I think things are heading
in the right direction. I think the Committee would be missing
a trick if it did not actually look going forward at the capital
vision for education and how FE fits into that vision. Since the
two departments have split apart there is almost a rivalry as
to who gets the capital budget, for schools or for colleges. When
you actually think about it schools and colleges are often dealing
with the same particularly tricky 16-19 issues, increased participation
and so on, so there is a real need to think together as two departments
on the capital investment.
Q151 Chairman: With the greatest
of respect, first of all, that is not part of our immediate remit
so I will stop you in mid-flow, but also that has been a problem
ever since, quite frankly, the Learning and Skills Council was
set up when there was that division post-16. There is nothing
new in that case. It was very frustrating for many colleges that
you had a Building Schools for the Future programme which did
not include colleges even though they were going to have a significant
number of the same students. Can I assure you that your thoughts
are not lost on this Committee and there is an inevitability that
at some time in the future, probably around 2020, that somebody
will return to this idea of why have we got two separate departments
because we keep coming across the same problems time after time
after time, but that is not our fault!
Mr Moore: I appreciate that. Another
issue that I think comes out of the Foster Report is that this
can happen again, and we have with Train to Gain at the moment
all the signs that we might be in the same sort of situation but
under different management and leadership. It is being tackled
with a degree of gusto, albeit a bit late, but I think we must
learn from Foster about the way in which we deal with these funding
issues.
Chairman: On that happy thought that
the Train to Gain programme might go the same way, we will thank
Martin Doel, Graham Moore and Dr John Blake. Thank you very much
indeed for being splendid witnesses this morning.
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