Memorandum submitted by the Learning and
Skills Council
INTRODUCTION
1. In June 2007, the Government announced
radical changes to the way that education and training for young
people and adults were to be managed and funded in the future.
A major part of these Machinery of Government changes was the
dissolution of the Learning and Skills Council (LSC) and the establishment
of two new bodies, the Skills Funding Agency (SFA) and the Young
People's Learning Agency (YPLA). These new organisations will
come into effect from 1 April 2010.
2. Whilst the Machinery of Government transition
programme has been a complex and challenging piece of work, it
has also been a successful one with many positive outcomes. The
Learning and Skills Council's successor bodies are now operating
in shadow form and from a total of 3,347 staff, fewer than
10 remain unconfirmed in new posts. As the shadow "running"
of the two new organisations began in the autumn of 2009 and
destinations of staff have been confirmed since September, there
has been a long lead in time to help ensure a smooth transfer
in April 2010.
3. The existence of effective joint management
arrangements between the two new shadow organisations has ensured
that the statutory responsibilities of the Learning and Skills
Council have continued to be discharged effectively. Importantly,
learners, employers and colleges and providers have not experienced
any interruption of service during the transition. The continuation
of effective joint working, at Departmental level down to sub-regional
and local level will be critical in ensuring that customers remain
well-served.
GOVERNANCE OF
THE TRANSITION
PROGRAMME
4. Once Machinery of Government announcements
had been made, the Learning and Skills Council worked closely
with its two sponsoring Departments to put in place robust governance
and management arrangements to oversee the transition. Overall,
the Machinery of Government programme was governed by a Joint
Programme Board, chaired jointly by the then Director General
of the Department for Innovation, Universities and Skills (and
now the Director General of the Universities and Skills Group
in Business, Innovation and Skills) and the Director General of
the Young People's Directorate in the Department for Children,
Schools and Families (DCSF). This Board reported directly into
Ministers.
5. Underpinning the Joint Programme Board,
a Joint Transition Management Group was established to ensure
that all of the detailed tasks regarding organisational structures,
staff and resourcing for the Skills Funding Agency, Young People's
Learning Agency and Local Authorities were completed in a timely,
coherent and consistent way. David Cragg was appointed as Transition
Manager for the Learning and Skills Council and represented the
organisation on all aspects of the transition.
PRINCIPLES AND
COMMITMENTS UNDERPINNING
THE TRANSITION
6. During 2008, the Learning and Skills
Council worked with its sponsoring Departments to shape the future
organisational structures of the Skills Funding Agency and Young
People's Learning Agency. Guiding principles were established
to ensure that the new Skills Funding Agency would be developed
and built on the achievements of the Learning and Skills Council
in the successful delivery of Public Service Agreement targets
for basic skills, level two qualifications and Apprenticeships.
7. At the same time, a Transition Plan was
produced that set out the timeline and process for matching staff
to the new organisations. Specifically, the plan focused on establishing
shadow structures by September 2009 and ensuring the maximum
number of Learning and Skills Council employees were offered roles
in new structures that would be considered as a reasonable offer
of employment.
8. The Transition Plan was endorsed by the
Joint Programme Board in January 2009 along with a set of
principles that would be adhered to throughout the transition.
These are set out below:
(a) DCSF, DIUS, the LSC and Local Authorities
(represented through the Local Government Association and the
Association of Directors of Children's Services) will work collaboratively
to ensure a smooth transition to the new arrangements. This approach
should minimise destabilisation and disruption to the LSC's operation
until April 2010, including maintaining sufficient management
and staff capacity during the transition to ensure the LSC can
carry out its delivery responsibilities and meet its operational
targets (as set out in the Grant Letter and its annual Statement
of Priorities) and to fulfil new priorities in response to the
economic downturn.
(b) The approach adopted maximises the retention
of LSC staff and their expertise.
(c) There will be a single unified HR Framework
for the People Transition that will cover all staff irrespective
of destination and will be underpinned by the principles already
agreed.
(d) A joint Skills Funding Agency/Young People's
Learning Agency/Local Government Association communications and
employee engagement strategy will support the people transition
programme.
(e) Managers fulfil their People Transition role
and responsibilities in a timely and professional manner.
(f) All employees fully engage and participate
with the People Transition Framework.
(g) We aspire for the full support of the Trade
Unions for the People Transition Framework.
9. In addition to the principles set out
above, DCSF, DIUS, LSC and the Public and Commercial Services
Union made the following commitments to LSC staff:
(a) Unnecessary uncertainty will be minimised.
(b) Where possible, expertise will be retained.
(c) Genuine consultation with staff and trade
unions will take place.
(d) Staff involved in any transfers will be consulted,
collectively and individually.
(e) Best practice and the principles set out
in the Cabinet Office Staff Transfers in the Public Sector will
apply. If TUPE does not apply, we will act as if it does.
(f) Staff involved in any transfers will be treated
fairly and consistently.
(g) Every effort will be made to avoid compulsory
redundancies (and we have committed that there will be no compulsory
redundancies prior to the transfer of responsibilities).
(h) Affected staff should have the opportunity
to update existing skills or acquire new ones.
10. Each of these principles and commitments
were overwhelmingly met during the transition process and the
right balance of staff will transfer to each of the Learning and
Skills Council's successor bodies and Local Authorities.
11. The recognised union for Learning and
Skills Council staff, the Public and Commercial Services Union
was consulted throughout the transition programme.
PEOPLE TRANSITION
12. In 2008, prior to the formal people
transition process beginning, the then Chief Executive of the
Learning and Skills Council, Mark Haysom, hosted national and
regional briefing sessions on the Machinery of Government changes.
These provided key information to staff and allowed them to ask
questions about the implications of the changes for the organisation
and for the sector. These events are one example of many communication
activities that continue to take place throughout the transition.
PHASES OF
THE PEOPLE
TRANSITION
13. On 9 April 2009, every member of
staff received a standard and detailed briefing on the Machinery
of Government transition from their senior management team. During
these briefings, staff were provided with a presentation on new
organisational structures and functions, a clear explanation of
how the matching process (see below) would work and details of
the offer available for staff transferring to Local Authorities.
Briefing materials and supporting documentation were made available
to all staff along with clear communication routes for questions
and issues to be raised and responded to.
14. Phase 1: March 2009: in line with a
TUPE process, this phase involved the matching of functional blocks
that could be transferred en masse to the new organisations because
the purpose, numbers, grade mix and locations would remain effectively
unchanged (eg the National Employer Service that now forms part
of the shadow Skills Funding Agency.) In addition, matching also
took place where it was determined that the function would continue
post-transfer and the numbers required were broadly the same or
similar, although the precise roles may be different to those
in the Learning and Skills Council. During this process, all individuals
were consulted on where they felt the majority of their work lay
(ie on youth or adult related activity) and the impact of any
location change. The major benefit of this approach was that it
removed the need for staff to compete for roles they already filled.
15. Phase 2: April to May 2009: the second
phase of the staff transition ran from April to May 2009. This
involved matching individual posts to posts in new structures.
Managers held one to one session with staff to identify with each
individual where they spent the majority of their time (functionally),
their preferences and any constraints on their working arrangements.
Individuals were then provisionally matched to the roles available.
It was made clear to staff in integrated functions that they were
being matched in order to identify their right to transfer, but
that they would not be expected to take on their new role until
the point of transfer in April 2010.
16. Phase 3: July 2009: the third phase
of the transition involved the scrutiny of every individual's
provisional match by Senior Management Teams to ensure the matching
process had been conducted consistently and effectively. If staff
were unhappy with their provisional match, they had the right
request that their match be reconsidered by a moderation panel.
17. Phase 4: August 2009: the fourth phase
of the transition was the final stage for the vast majority of
staff as this involved the confirmation of their match. This phase
was complete by the end of August 2009. In some cases, there were
situations where there were too many staff for the posts available;
in these instances, interviews were held to confirm which individuals
would fill the roles.
18. Staff that had the right to transfer
but were still unmatched by September 2009 were supported
through a contingency and redeployment process through which Cabinet
Office protocols for handling surplus staff were followed. The
proportion of unmatched staff was extremely small and now numbers
fewer than 10. There was no early retirement or severance scheme
on offer during the transition process.
19. The outcomes from the people transition
process have been extremely positive with the overwhelming majority
of Learning and Skills Council staff now confirmed in a post in
the Skills Funding Agency, the Young People's Learning Agency,
a Local Authority or other organisation (see paragraphs 22 and
24).
20. The Skills Funding Agency has an establishment
structure of 1896 posts of which the vast majority have been
filled.
STAFF TRANSFERRING
TO REGIONAL
DEVELOPMENT AGENCIES
AND BIS
21. On 31 July 2009, Peter Mandelson
wrote to Jim Braithwaite, the Chair of the South East Regional
Development Agency to set out his intention to make Regional Development
Agencies the single body responsible for regional skills strategies.
This has necessitated a transfer of around 50 staff from
the Learning and Skills Council (staff that would have transferred
to the Skills Funding Agency) along with the budget for those
staff. As this development occurred in the midst of the Learning
and Skills Council's people transition process, it was handled
with extreme sensitivity and care so as to minimise disruption
for staff midway through an existing matching process.
22. It was agreed with BIS and Regional
Development Agencies that staff would be appointed on a secondment
basis rather than being transferred. In November 2009, each Regional
Development Agency delivered a standard presentation to Learning
and Skills Council staff that had expressed an interest in taking
up the posts. This has resulted in around 30 staff being
confirmed to move with a further recruitment exercise taking place
in January 2010. Learning and Skills Council employees will have
priority on Regional Development Agency vacancies because of their
TUPE rights.
23. A small number of other specialist functions
are being transferred to other bodies (eg BIS on evaluation and
strategic analysis, UK Commission for Employment and Skills on
research).
OPERATING AS
SHADOW ORGANISATIONS
24. The Transition Plan for the Machinery
of Government programme set a clear commitment for shadow structures
to be phased in from September 2009. The exception to this was
the formation of the National Apprenticeship Service (housed in
the Skills Funding Agency) as this was established in April 2009 with
a complement of 400 posts.
25. During the summer of 2009, regional
and national teams developed detailed handover plans to ensure
staff could transfer to shadow organisations without incurring
any risk to the delivery of the Learning and Skills Council's
statutory responsibilities. Staff within integrated functions
(such as funding teams) continued to remain integrated (supporting
both youth and adult activity) until such time that a handover
could take place to new shadow teams. Staff in finance teams remain
integrated and will do so until the end of March to ensure that
the Council's remit continues to be fulfilled.
26. An acting and permanent Chief Executive
had been appointed to the Young People's Learning Agency in March
2009. David Cragg was appointed as the Interim Chief Executive
of the Skills Funding Agency in November and in December 2009,
Geoff Russell was announced as the future Chief Executive of the
Skills Funding Agency, completing the appointments to the executive
management team.
27. Staff transferring to the Young People's
Learning Agency moved into their shadow roles from September 2009 with
delegated authority for 16-18 budgets passing to the shadow
Young People's Learning Agency on 1 October. Staff due to
transfer to Local Authorities remain under the management of the
Learning and Skills Council but are operating in their new roles
and progressively taking up their new responsibilities, while
ensuring that residual Learning and Skills Council responsibilities
are discharged
28. Staff transferring to the Skills Funding
Agency moved into their shadow roles between September and November
2009 when formal delegations for 19+ were made. The transition
to shadow Skills Funding Agency structures was managed carefully
to ensure its account management function was able to assume responsibility
for provider management without causing any disruption to colleges
and providers. Account management teams are now in place and are
working with colleges and providers to agree their allocations
and contracts for the 2010-11 academic year.
INTERDEPENDENCIES
AND SHARED
SERVICES
29. Early in the transition process, it
was recognised by both Departments that in a number of critical
areas it would be essential to establish strong joint working
arrangements between the two new agencies and at a local and regional
level with Local Authorities. These interdependencies have been
fully scoped as part of the Transition Plan and working practices
have been agreed that will avoid confusion or duplication at provider
level, particularly for colleges. This work is now embedded in
joint management arrangements between the shadow organisations.
The areas include:
(a) Joint capital planning.
(b) Performance management including implementation
of Framework for Excellence and FE intervention.
(c) FE regulation/sponsorship including mergers,
federations etc.
(d) National Apprenticeship Service 16-18 commissioning
in conjunction with Local Authorities.
30. There are also several cost effective
shared services between the two organisations that are co-ordinated
through joint management arrangements. These include:
(a) Information Services including the Data Service.
(b) European Social Funding.
COLLEGES AND
PROVIDERS
31. A key principle underpinning the transition
has been to ensure that colleges and providers experienced no
disruption as a result of the Learning and Skills Council's organisational
change. Whilst 2009 has been a challenging year for the sector,
with ongoing issues on Train to Gain and capital, no issues have
arisen because of the transition. In large part, this is due to
the hard-work and professionalism of Learning and Skills Council
staff in offering continuity of service to the sector.
32. A significant amount of communication
and briefing has been provided to the sector on the impact and
implications of the Machinery of Government changes and how the
Learning and Skills Council's successor bodies will engage with
them. In November and December 2009, the shadow Skills Funding
Agency ran a round of briefing events for colleges and providers
on BIS's Skills Strategy and Skills Investment Strategy: these
briefings set out the Government's priorities for the adult skills
sector and the funding settlement for 2010-11.
33. Each college and provider is now clear
who their shadow Skills Funding Agency Account Manager is, enabling
them to have one single point of contact for all matters relating
to post-19 delivery. Account Management teams are based around
the country and are responsible for a caseload of colleges and
providers, from those that deliver in the local area to those
that are multi-regional or national. In all cases, Account Managers
deal with the whole of a provider's post-19 delivery, regardless
of where that delivery takes place.
34. The shadow Skills Funding Agency is
currently developing a Single Account Management IT System that
will allow information about accounts, contracts, funding and
performance to be shared with colleges and providers. This will
replace a number of Learning and Skills Council legacy systems
and will greatly streamline planning, allocation and performance
management processes.
RISK MANAGEMENT
35. Since his appointment as Acting Learning
and Skills Council Chief Executive, Geoff Russell has undertaken
a fundamental review of risks and management accountabilities.
This has resulted in the implementation of changes to governance
and a new and systematic risk management regime, overseen by the
Learning and Skills Council's National Council. A Chief Operating
Officer was appointed on an interim basis, as was a National Projects
Director to work specifically on the Further Education capital
issues. The role of the Learning and Skills Council's National
Audit Committee has also been strengthened through their oversight
of the risk management process.
36. On capital, the entire further education
capital budget is the responsibility of a Tier 2 member of
staff reporting directly into the Chief Executive of the Learning
and Skills Council. He is working closely with the Finance Director
to ensure that there is strong control on the capital budget.
The 16-19 capital fund is the responsibility of another senior
member of staff (transferring into the Young People's Learning
Agency). On both programmes, extensive work was carried out in
April and May 2009 to understand the full range of liabilities
on these budgets; this has helped the Learning and Skills Council
establish budgets for the next five years (2009-10 to 2013-14)
against which all potential and new liabilities can be set. Monthly
monitoring of the expenditure and reporting into the National
Council, BIS and DCSF provides complete transparency on the overall
programme.
37. A recent Financial Healthcheck of Learning
and Skills Council systems and controls provided confidence that
the capital programme and other financial systems are strong.
11 January 2010
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