Education Bill

The devil is in the detail. There is a lot that we do not know about this system. Any bureaucratic system of repayments must be flexible enough to allow employers to pay to support employees, both old and young, and to support apprenticeships in the workplace. It must also be flexible enough to allow those individuals with the means to repay to do so when it suits them. They are planning for the rest of their life, and study cannot be separated from that. 

Martin Bean: We would be worried about the dip that I have already touched on. If we are not careful, one of the unintended consequences of this may affect those in our society who just want to get started and need some support in their first year for their hopes and aspirations so that they can succeed in higher education. If the funding levels for widening participation drop, we will see a dip in the number of those people. Of all the dips we may see, I would be saddest about that one. It is fair to say that we do not know. The only certainty is that if there is a wholesale drop in funding for widening participation for targeted populations under the current system, we can expect to see a greater drop in the future system. 

Q 314 Mr Wright:  Mr Bean, you mentioned support for part-time students. The Browne review was quite scathing in many respects, and suggested that support for part-time students is not adequate or equivalent to that provided to their full-time counterparts. Is that a valid observation? 

Martin Bean: Thank you for the question. It is absolutely a valid observation, and I am delighted to see how everybody has rallied around that finding in the Browne report and supported it. That is terrific; it is the point that everyone seems to agree on at last. As I have said before, it is about 40% of all undergraduates. Your first question was about the practicality. Browne also talked about it being free at the point of entry—that is absolutely critical. David has talked to you a little about at what point people should start repaying, and there has been some great work on that. On the lowering, Browne recommended 33% intensity and dropping that to 25%. That one change allows the OU alone to bring in an extra 19,000 students. This is a journey of cleaning up and normalisation. The White Paper has to put a lot of the meat on the bones, as does the legislation that will follow. 

There are a couple of points to illustrate what still needs to be decided. One of the things recommended by Lord Browne and his team was that we should meter numbers into the system through UCAS tariff points—A-level tariff points. He also mentioned in the report that there should be a separate system that operates for those such as the Open university. Let us put that in context. I have 265,000 students and 41% have one A-level or fewer. That is why I am sure David Willetts stated that that is an unworkable way of metering numbers into the system. 

Mr Hayes:  We won’t do it. 

Martin Bean: Thank you, John. I have another illustration of that point because it is important and there are a wider number of things that need to be cleaned up. The 1962 Act likes to define full-time education through an in-attendance rule. That might have been appropriate for the 1960s, but in a web 2.0 world, defining full-time education by being in attendance is somewhat laughable. We have to have the courage to clean up those types of things. Otherwise, we will inadvertently perpetuate the two systems. 

Q 315 Mr Stuart:  Do you think that the Bill and the policies set out in it will allow a more dynamic and flexible future for the provision of higher education? Could you describe what that might look like? 

Professor Latchman: Absolutely. In the next few years we will start to see people having a choice of whether to study full time or to work and study part time. Many mature students now go through UCAS and study full time, probably because they do not know about the availability of part time. It is an amazing change that UCAS is proposing to flag part-time courses from 2012–13 and have a single entry system from 2014–15. We are absolutely clear that all parties are committed to doing this, and we to delivering it, but the only caveat is that the detail needs to be got right. The devil is in the detail. There is no deliberate attempt at whatever; it is an issue of not understanding. I was told in the last few days by a senior civil servant that, because my students

John Widdowson: That is the key price—there will inevitably be short-term turbulence. For part-time students in the FE sector, there will be a significant increase in the price of courses and we will have to explain that. It will be difficult. I cannot predict what our enrolments will be in 2012 compared with 2011—having said that, I predict that they will possibly go down for all sorts of reasons. We are faced with price increases to individuals or employers, which we will have to stand by and justify in terms of the quality of what we offer. But the artificial divisions between full and part time need to be broken down. I do not think that there is any comprehensive or widely understood definition of what full-time study means these days. Most students on full-time courses have part-time jobs. Those jobs can extend into the rest of the time they have, and that is no bad thing in many respects, because it prepares them for work. So if we could get away from some of the artificiality of the system, which has held us in good stead up to now, and let it open up access to higher education to people who choose different routes at different stages in their lives, it will be a job well done. But we need to think about different definitions, and I do not think that full and part time are very helpful as we go into this new world. 

Q 316 Mr Stuart:  It seems to me that we have been focusing on careers guidance and trying to make sure that vocational and academic routes are made available. Careers guidance needs to bear in mind part-time study, as well as vocational and so on. I think it is only about 4% of people who start an apprenticeship go on to HE at the moment. This Government is, in my view rightly, building on the previous Government’s efforts on apprenticeships and will take them forward. How do we ensure that apprenticeships can lead on to whatever level a person wants to reach? 

Martin Bean: There is no doubt that we need to do a much better job of knitting together secondary, further and higher education with more connected pathways. It is not just about the advice and guidance, but also structural reform in the way that we validate institutions, the normalisation of the Quality Assurance Agency with what it takes for a higher education college to collaborate with a further education college. It is about ensuring that credit is more transferrable within the system and that we have vocational lattices where people can see how they can progress between and through institutions. 

Going back to your question, the good thing is that the Bill and the work before it puts all those enablers in place. But again, there is a piece of work, which I know John is very supportive of as well, which still needs to get done to ensure that our world’s work more effectively together so that people, through the various stages in their lives, can move through and in and out of the system as and when they need to. 

John Widdowson: The 4% figure is UCAS-derived if I am not mistaken. It will only monitor full-time progression. So if a young person takes an apprenticeship at 16, they

Q 317 Mr Gyimah:  One thing I want to understand is this whole idea of levelling the playing field. Before we go there, can you explain to me how those on part-time courses, who are not funded by the employer, currently fund themselves? 

Professor Latchman: Currently, if you have an income below a certain level, you are able to obtain fee support, but it is paid to you as a grant. That fee support is capped at a level that is approximately half of what you would get if you were studying pro rata to full time. In other words, it will pay about half your fee. That is at the minimal level on a very low income. That tapers away as your income rises. There is very poor support—minimal amounts of money—for the very poorest students. That is not a level playing field in terms of what is available for full-time students. 

Q 318 Mr Gyimah:  Presumably, there are some students who would use things such as the career development loan to fund part-time courses. Some take out commercial loans. In that context, the new regime, which is in this Bill, is a significant step forward to how people on part-time courses fund themselves at the moment? Am I right? 

Professor Latchman: That is precisely why we and the OU have greatly welcomed this change. 

Q 319 Mr Gyimah:  The next thing is about the participation. Martin Bean, you made a comment about lots of your students being in their 30s and 40s. In the interests of widening participation, especially in an area in which fees are going up, how would you go about attracting students in the lower age groups, the 18 to 21 group? 

Martin Bean: In fact, our fastest growing cohort in the last 12 months has been the under-25-year-olds. About 25% of our student population are 25 years or younger and there has been a 20% increase in that cohort. That is because part-time education—earn and learn as it is starting to be characterised in the media—is

Q 320 Mark Hendrick:  On the earn and learn, the previous panel mentioned the fact that sandwich courses were beginning to die out. I am one of those people who, in the past, did a sandwich course and benefited greatly from it. The advantage was that you could earn money and that helped with your costs. Why have they died out when fees have been introduced and there is natural incentive to do such a course? 

John Widdowson: That type of course was in decline well before the existing fees regime, partly because of the difficulties in finding the right sort of placements for students for a year. There were still some, but as HE developed and grew, the number of placements probably did not grow to the same degree. One’s mind moves more towards how we educate people already in employment so that they do not have to make that break in the sandwich provision but can actually not rule themselves out from higher education by choosing a work-based route. That was starting to emerge as a real option. I am not particularly surprised by the decline of the sandwich course. For some people and for some industries, it is the right thing, but there are other options that might be more flexible and more appropriate that allow people to earn alongside learning in a much more organised and structured way that employers support and that leads to a job at the end of it, or even has a job all the way through, which is the ideal solution. 

Martin Bean: Just to add, four out of five of the FTSE 100 companies sponsor employees on OU programmes today. It still is alive and well, in another way. This notion of the sandwich programme as you described it is about to go through a renaissance. Some of you may have seen KPMG’s announcement with the university of Durham about allowing people to start straight away and begin their audit careers as well as doing their accountancy qualifications in parallel. Our ability to bring in to FE and HE in more meaningful ways what the CBI estimates as the £18.5 billion a year that is spent on plc training, while at the same time allowing people to get the goodness of studying and practising at the same time, will create some great outcomes. Going back to your question about painting a picture for the future, I think that is a great picture of the future. 

Q 321 Kevin Brennan:  Perhaps I could direct this question to Professor Latchman in particular. Would you welcome the Government accepting an amendment to the Bill requiring parliamentary scrutiny of the setting of the interest rate on student loans? 

Professor Latchman: We would say that that was a matter for the general sector. All we would ask is that whatever scrutiny is applied is applied equally to full-time and part-time students. 

Q 322 Kevin Brennan:  That would be your answer too, would it? 

Martin Bean: Yes, I would agree with that. In principle, scrutiny over anything is important, particularly on the way that we fund education and ensure that it is as inclusive as possible. As David said, it must be applied equally. 

Q 323 Kevin Brennan:  You have expressed concern, Mr Bean, on the position of part-time students who are already earning over £21,000, which is the repayment threshold for student loans, while they are studying. How would you recommend that these students be treated under the new system? 

Martin Bean: Certainly, free at the point of entry, along with full-time students. The current statement on students repaying once they are three years into their course of study is something that we support. I also support David’s comments that we need to avoid anything that looks like part-time students being treated unfairly compared with full-time cohorts in terms of the expectations. If that means that we need to move more to a four or four and a half year delay, based on the discussions or David’s comments, to ensure that there is that parity of treatment, that is critical. That is because we need to avoid, at all costs, any further impression that there is a distinction between part time and full time. 

Professor Latchman: Currently, if you earn over the threshold you repay in the April after your third year, and I would suggest that for part-time students, one should move to the April after the fourth year. There are two very good reasons for that. First, that places it in line with four-year full-time students, who repay after they have graduated. Secondly, it would remove the unfortunate strapline that, as currently constructed, all full-time students will reach their repayment point, whether they repay or not, after they have graduated, while all part-time students will reach it before they have graduated. 

Q 324 Kevin Brennan:  That is a very helpful clarification. Can I just ask Mr Widdowson about the price of courses, which he mentioned earlier? If you were to make an estimate, what would be the FE rate of inflation that we can expect for courses, all things being equal, over the next couple of years? 

John Widdowson: Because of the withdrawal of the HEFCE teaching fund contribution, we are probably looking at a doubling at least of most course fees in the first year. 

Q 325 Kevin Brennan:  Did you say a doubling? 

John Widdowson: Yes. Courses are now priced in their hundreds. We will pro rata price them. It depends what the price for each course is fixed at—whether it is between £6,000 and £9,000, or less than that. I would expect it to be pro rata to the price that is fixed. 

Q 326 Kevin Brennan:  So we could expect an FE rate of inflation for courses, other things being equal, of 100%. 

John Widdowson: In the first year, as we compensate for losing the HEFCE teaching grant. 

Q 327 Mark Durkan:  My question would be to Mr Widdowson again, based on his FE experience. On the provisions in the Bill on powers for members of staff in FE institutions to search students, do you see any issues with how those powers are provided? Would you have any apprehension that colleges or staff could face controversy or litigation either for the exercise of such powers, or, as often happens in my part of the world, Northern Ireland—where litigation is increasingly based on people being accused of dereliction—for not having exercised powers, in a way that led to a risk to someone? 

John Widdowson: It is important that college staff have the same powers as those available to staff in schools. That seems to be entirely sensible. There is a further complication in virtually every FE college—maybe not in sixth-form colleges—in that we have adult students on the premises as well. It might be slightly different to deal with a young person under the age of 18 and then to deal with an adult. Given that we are trying to widen participation not just in HE but in all sorts of other provision as well, we get all sorts of adults through colleges, as you will be aware. 

Therefore, I think, that power needs to be handled sensitively. Certainly, in my own institution, it would be done—and is done at the moment, where we have powers to intervene with students—only by trained staff, and in most cases by specialist security staff. It is not something that I would expect every classroom lecturer to engage in as a day-to-day activity; that would be most unusual, and to be discouraged. But to have the same power would be very useful and very valuable. 

Q 328 Mark Durkan:  Further to that, on the disciplinary powers in schools, the Bill makes reference to school rules, but there is no equivalent reference that I can see to college rules specifically in relation to the powers given here. The powers are basically given to staff. There is also a provision that in exercising those powers, people would have to have regard to the guidance issued by the Secretary of State. How often do you think the Secretary of State might issue guidance on such matters? Every time that there is controversy over a particular case or issue, will there not be demands for the Secretary of State to give a view on whether what happened at a particular college was consistent with the guidance issued? 

John Widdowson: We always value the guidance of the Secretary of State, obviously, but it is important that they listen to what actually happens in colleges, the reality of how we deal with our students, the sorts of issue that our students present us with and how we have to cope with them on a day-to-day basis. There are some really serious issues within some inner-city colleges, where you have to make sure that the environment is safe and controlled and that it is a place where we would want to send our kids, in the same way that we expect other people to send theirs. I would expect and hope that the Secretary of State would consult widely on this, listen to the voice of experience within colleges and then give effect to that in whatever guidance he came up with. 

Q 329 Julie Hilling:  My question is at the other end of that and involves postgraduate education, whether that is masters, doctorates or professional qualifications after people have done their degree. Have you considered at all whether fees will have a detrimental effect on people continuing with their education? 

Professor Latchman: We do both full-time and part-time masters and PhDs, whereas we do only part-time undergraduate degrees. I am expecting that the full-time market might start to contract due to the burden of debt, but I rather think that the part-time market will expand, because it will become increasingly attractive to say, “I’ve got my job and I’m going to study part-time because I’ve got the debt carried over from my undergraduate degree.” I think we might see a shift between studying full-time and studying part-time at that level. The fees will presumably be affected only in a different way, because there is no direct effect in terms of the changes in support at the undergraduate level. 

Q 330 Julie Hilling:  I do not know whether you do full-time professional qualifications post-graduation. 

Professor Latchman: We do part-time professional qualifications. 

Q 331 Julie Hilling:  So you do not have courses where people cannot work until they have completed them? 

Professor Latchman: No. 

John Widdowson: With regard specifically to professional qualifications, there is already a lot of self-funded provision there, not least because if it gives some form of licence to practice, in the way that you just said, the student can see some incentive. Equally, to go back to my point about employers, often employers will pay for their staff to be qualified, because it helps them carry out their business more effectively. In accountancy practices and legal practices, it is to the benefit of the employer to have people qualified to a certain level. Then they can undertake more independent activity. 

I think that there is an issue about access to the professions, however one defines the professions: not simply surgeons and lawyers at the top end, but all the other professional bodies that give access to people from low-participation groups. There may be an issue there that crosses the different funding streams for FE and HE. Many of those courses start at level 2 or level 3 and then have a progression pathway into level 4 and beyond. There are some issues at that lower end—the access end—where we probably need to look again at what sort of support is available and what sort of support for fees is available for people who want to go down a professional route as opposed to a traditional academic route. I would not want that to be neglected in this debate. There is a challenge in relation to full and part-time definitions and a real question about how we can break down some of those barriers and give support to the people who need it. 

Q 332 Mr Stuart:  I wondered what your thoughts were on the tuition fees policy more widely. It seems that the policy Professor Smith laid out earlier has shortcomings, but not the ones that have been communicated to the public. In terms of access, lower-earning people should not be put off; they should be celebrating this new system. The question, rather, is

Martin Bean: It is impossible to know right now what the implications will be, but here are just a few thoughts for you, so that I can answer the question. Firstly, because part-time is set outside the current system, we have always charged fees and we have always been market facing. So we have always had to be in tune with the notion of value for money for our students and returning value for what they invested with us along the way. The same methodologies we have always used to price in the market historically are exactly the same ones we will use to figure out where to go in this new world. As I have mentioned, it was absolutely vital that it was free at the point of entry and that payment did not begin for part-time students right away or until they were earning above £21,000. Those things have been taken care of. Without being repetitive—because I know the Chair would like me not to be—looking forward, should we see a retrenchment away from the current investment in widening participation funds, we absolutely will see a drop in participation from those communities that need a starting point to enter higher education, irrespective of how we structure the loan programme. 

Professor Latchman: I entirely agree with that. The full-time sector will have to learn some of the lessons that we learned in the part-time sector a long time ago. I was interested to note, when talking to the chief executive of UCAS, that she thinks some institutions will introduce a tiered fee structure with different fees for different things. We have that already, with a default tier in the middle, higher fees for certain popular professional-type courses—such as law—which are strongly supported by bursaries, and a lower tier for widening participation-type courses. We will continue that in the new system with higher fees. The full-time sector will probably have to learn that lesson, but there will not be many institutions that just put a blanket fee out. If they do, they might well have to change to a tiered structure in a few years’ time. 

Q 333 Mark Hendrick:  On that point, you see universities marketing courses a bit like supermarkets market their goods, with loss leaders and some courses cross-subsidising other courses. They are selling it in that way in order to maximise income and keep the show on the road. 

Professor Latchman: If you go down the London underground, you will see huge numbers of Birkbeck adverts. We spend an enormous amount on that sort of marketing because we do not have the captive audience of 18-year-olds who come through UCAS. We have had to learn lessons about that, including the type of courses I mentioned earlier—low-cost access one-year certificates that, if you pass, you go into the second year of a degree course. Courses like that could be offered in partnership with FE colleges, for example, which is something we are exploring with a few colleges in London at the moment. They will have to be more creative in those terms, rather than relying on a captive cadre that just looks at UCAS and says, “Okay. That seems fine. I’ll go there.” 

John Widdowson: I shall point out three things. First, participation initiatives have been valuable, but they take time. They do not just take effect at the point of

The second thing is just the need to communicate this. We are probably dealing with a lot of debt-averse families and individuals. The sums look very big and the repayment periods look very long. There has to be a clear explanation of what this means and what the deal is for them. 

The third thing would be about keeping the bureaucratic burden of all this on the student as simple as possible. It is early days yet and we do not have much detail, but it looks quite complicated from the student’s point of view. There are quite a lot of gateways to get through that were not there before and which need to be explored and simplified as quickly as possible. 

Q 334 Mr Hayes:  This is a question targeted at John. By the way, I think my office has been in touch with your college today to arrange a visit. 

John Widdowson: We are anticipating it already. 

Q 335 Mr Hayes:  With glee? 

John Widdowson: Absolutely. 

Q 336 Mr Hayes:  You will be familiar with the Foster report of some years ago which talked about a galaxy of oversight, inspection and so on. The measures in the Bill do two things. They lift colleges out of some of the statutory requirements that previously prevailed and they give them some new freedoms. How welcome are they? 

John Widdowson: They are very welcome. Colleges, like universities, value the autonomy that they are given. The more autonomy we have to make our own way, even through difficult times, the better. That allows innovation and creativity. It also allows accountability in a much more direct way. Although that can sometimes be difficult, if you are the person being held accountable, it is important, given the amount of public funds and individual funds that are now in the system and always have been in the system. It is to be welcomed. It is something that we are used to and we look forward to it. That is a very positive element in the Bill. 

Q 337 Mr Hayes:  How much of that is about simplifying the funding? One of the complaints that I heard over the years in opposition—in the dark days before I came into the light of government—was that funding and funding mechanisms can sometimes inhibit the kind of discretion that you need to respond to learner choice and employer demand. 

John Widdowson: Particularly in terms of responding to local need and local demand, what operates in the south-east of England may not operate equally well in the north. The priorities may be different and what we have to do to serve our communities will certainly be

Q 338 Mr Stuart:  Do you think that the end of the diploma entitlement is a regrettable move or a recognition of reality? What does the future hold? 

John Widdowson: That is an interesting question. I think it is a recognition of reality, to be honest. If we take the headlines from the Wolf report in the media today, I do not think that is a vote against vocational education, it is a vote for meaningful and realistic vocational education. Colleges have had a lot of experience in delivering that. Until recent times in my own college, we had 500 young people coming in a week under what was known as the increased flexibility programme. They were doing NVQs at level 1. They were learning real skills and you could see the competence that they got in a context that they enjoyed, which led to them succeeding better at school and progressing to study, employment or apprenticeship at 16. Those programmes have a real impact. It would be wrong to have any form of dilution or any form of soft-edged vocationality, which does not do anybody any good, particularly the students. 

Q 339 Kevin Brennan:  Do you have any estimate of what you expect to happen to apprenticeship numbers for 16 to 18-year-olds in your area over the next couple of years? 

John Widdowson: They are in very short supply at the moment. We are working very hard to get employers to support young people into apprenticeships, but it is difficult. It is difficult because of the economic situation. When employers look at the size of their work force, it is quite difficult to look at reductions they may have to make and at the same time to create opportunities for young people to come in. 

Q 340 Kevin Brennan:  So will they go down? 

John Widdowson: I think they will. 

The Chair:  I thank the panel for being very polished and informative in giving evidence. Thank you for joining us today. 

3.15 pm 

The Chair:  Hello. We shall crack on; there is half an hour left, so I shall hand you over to the Minister. Can we have quick questions and quick answers? 

Q 341 Mr Hayes:  You know that the Government are committing resources, emphasis and status to apprenticeships. Do you welcome that? 

Michael Davis: Absolutely, yes. 

If you would like a slightly longer answer, at the UK Commission for Employment and Skills, we see a commitment to apprenticeships across all four nations within the United Kingdom, which is nice to see when school policy is often devolved. In Wales, Scotland, and Northern Ireland, you see a strong commitment to

Q 342 Mr Hayes:  The recent national statistical first release shows growth in apprenticeships in every area and every age group, but what more can we do to support apprenticeships? Is it about frameworks, levels or employer engagement? How do we deal with those things? 

Mark Farrar: I would see that coming in various tiers. One of the starting points is with information, advice and guidance in schools, and there are what I would describe as various pathways through the schooling system that would lead young people into an apprenticeship, or, as in my case, to a wider career in the construction industry at a professional level. Funding also has a part to play, not only at the 16 to 18-year-old level, but in how that is orchestrated over higher-level apprenticeships and those pathways into higher education that were discussed earlier. 

Michael Davis: If I may briefly add something to that, what you see from the data is variation in the take-up of apprenticeships by sectors. Clearly, Mark’s is a leading sector in terms of the take-up of apprenticeships, but there are others where more can be done. When you look at apprenticeships by numbers of employers, you see pockets of small businesses that do an awful lot, and the number of apprenticeships that such employers take on relative to the size of their work forces is very strong. Larger employers take on more apprenticeships, but they make up a lower percentage of their work forces, so there are opportunities to extend the number of apprenticeships there. 

There are also progression opportunities, so if more can be done to extend apprenticeships at level 3 and level 4, it would be very positive. We need to look at the apprenticeship frameworks, because a small number of them provide a vast majority of apprenticeship numbers. The commission’s own work around future skills demand highlights the importance of STEM subjects, so science, technology, engineering and mathematics all have areas where we see prospects for apprenticeships in the future. 

Q 343 Mr Hayes:  One small question in response. You talked about information, advice and guidance. You will know that there will be an all-age careers service from the autumn, and part of its purpose is to rebalance advice that is given so that it is more equal in respect of vocational options. Should sector skills councils, however, be given greater clarity about their role in primary legislation? Would an amendment to the Bill that defined the legal personality and the function of sector skills councils be welcomed? 

Mark Farrar: Employers should be engaged in that information, advice and guidance on two levels. First, the raw information needs consistency and it needs to be bang up to date right across the country in its delivery. Employers in various sectors—not only my own—can participate in ensuring that that is the case. Secondly, employers can play a very hands-on role in engaging with schools. On construction skills, there was an example at our Cambridgeshire training group with employers where we had schools and schoolchildren, and it all worked perfectly. There was real-buy in from

Q 344 Mr Wright:  Do you see this Bill as moving away from the previous Government’s approach to apprenticeships? Is it a different direction of travel? 

Mark Farrar: It is good to see support for apprenticeships —there is no question about that. 

Q 345 Mr Wright:  But, essentially, the previous Government revitalised apprenticeships by trebling them and doubling the number of completions. Apprenticeships really were revived. 

Mark Farrar: We certainly have seen increasing numbers of apprenticeships in past years—certainly in construction —but the dominant factor that we have to deal with at the coal face in my organisation at the moment is the economy and the output. Construction has gone through a tough time and the forecasts for an industry that employs more than 2.5 million people and that accounts for 8% of GDP are lacklustre at best for the future. The challenge is to get that basic contract of employment for a young person that will secure them the apprenticeship. The challenge will lie in how public funding in particular can assist that, especially in specialist areas. That will be over a journey for that individual. The road ahead will be rocky, but it is the economy that will drive it. 

A good example might be something like the Government’s own green deal and the low-carbon agenda. If I was a young person who had fallen out of the industry or who was unemployed through no fault of my own, there would be challenges getting back into the industry or skilling myself to the degree required to participate in some of the potentially growing markets of the future. That can be surmounted, but it will take time and effort. 

Q 346 Mr Wright:  Our parliamentary colleague, Catherine McKinnell, has brought forward a private Member’s Bill on linking public procurement with growing numbers of apprenticeships, and the Minister has been very positive towards it. It has not got through due to lack of parliamentary time, but would you welcome amendments to this Bill that would enact a lot of what Catherine tried to do on public procurement in her Bill? 

Mark Farrar: Certainly, at ConstructionSkills, we have spent a lot of time and effort helping to develop procurement guidelines for clients—in this case, public sector clients of all sorts—particularly to deal with OJEU requirements in particular. We have specified, on a light-touch basis, skills and, particularly, apprenticeships. That work has progressed over the past 18 months, and I believe that it is having an impact at this moment in time on maintaining a flow of apprentices, certainly in some areas. I would welcome a deeper embedding of that, but the caution that would be needed, if I take construction as an example, is that, at the end of the day, construction companies are there to build things, so there is a limit to what can be put in their contracts and what they can be expected to deliver alongside that. 

Q 347 Mr Wright:  What needs to be done to increase the numbers of apprenticeships for 16 to 18-year-olds as opposed to, for example, for people over the age of 25? 

Mark Farrar: In construction specifically, our challenges tend to be at 19-plus if employers are seeking a slightly older intake. You do not necessarily want a 16-year-old at the top of a 20-storey scaffolding rig for various reasons. On 16 to 18, in my own sector, we would continue to do as we do now—engaging with schools and with career pathways through something like the construction and the built environment diploma—to keep that throughput moving through and the attractiveness of the industry. 

Michael Davis: To answer your first question, I think that the growth in apprenticeships builds on the policy of the previous Government. I echo that it is reflected in all four nations, so there is a genuine UK consensus to do more and to continue to do more. 

To answer your question about procurement, the commission’s view would be that sectors, and strong sector leaders and business leaders, should be identifying what is the best mechanism in their sector that would really drive the demand for them. I think that that highlights the importance of a sectoral approach. When we have looked at international evidence on what we call collective measures, there is no single magic bullet so that you can say, “Well, if we did procurement everywhere, that would solve the problem.” You look at it in each sector and say, “What is your biggest skills challenge? How do apprenticeships play a role? How can we cause an action?” In construction’s case, that is through the levy. In another industry, it might be through a collective measure action, but the important thing is the bottom-up business leadership that says that this is the right thing for us to do so that business is driving that change of behaviour. 

In relation to 16 to 18-year-olds, the take-up will, again, vary by sector. The most important thing is provision of work experience opportunities. When you look at things such as the commission’s employer perception survey, you see that although only a small number of employers take on 16 to 18-year-olds, when they do they are broadly satisfied with them, and as they get older they become more satisfied with them. So the logic of that is that the greater the quality of the work experience that you can offer, the greater the chance that you could increase the number of 16 to 18 take-ups. 

Q 348 Richard Fuller:  I just want to evolve that theme, if I may. There has been some commentary, both here and outside, saying that over the past few years, there has been over-concentration on university as the only way to go and a lack of focus on apprenticeships. Do you think that that is fair comment? Do you think that there is a need to herald and champion apprenticeships? 

Michael Davis: There is a continuing need to herald and champion apprenticeships, and I think we are getting very close to a tipping point at which higher education becomes an increasingly expensive option about which young people will think very seriously before they embark on it. At the same time, with groups such as the Apprenticeship Ambassadors Network, there are some very strong household-name employers, and the UK Commission for Employment and Skills has some very strong case studies and examples of the value of the apprenticeship route. There is strong economic evidence about the wage returns for individuals pursuing the apprenticeship route. We just need to keep pushing out those messages. 

Q 349 Richard Fuller:  So there was no over-focus on universities in the past. You do not think that is a fair comment? 

Michael Davis: Governments have sought to widen the number of options for higher education in the past—yes, perhaps at the expense of the vocational route. 

Mark Farrar: What is important is that we get the career pathways mapped out to enable those linkages. In construction, there is a propensity for at least some cohorts to go through on a part-time basis. In ConstructionSkills we use employer funds to support some 20,000 apprentices, but we also have 5,000 undergraduates. Those undergraduates are not necessarily full time. Some are part time, and some could even be day release. 

We have been doing some work with the Institution of Civil Engineers and we have a higher level apprenticeship coming on stream. Care needs to be taken in future to ensure that funding is mapped out all the way from 16 right through to higher education. Particularly with the introduction of loans, you do not want to have a lower rate of funding for, say, a level 4 apprentice, only to hit a higher rate of funding and loan system for foundation degrees or undergraduate degrees. 

Q 350 Richard Fuller:  I have a second question on apprenticeships and small businesses. I was heartened to hear you say that small businesses are very active in taking on apprentices, because I assume that there is a quite a lot of burden on small businesses with limited overheads when managing people through apprenticeship programmes. Could you talk a bit about some of the practical problems that small and medium-sized businesses might encounter in keeping apprentices? What can be done to smooth that further? Could skills based on entrepreneurship and setting up businesses be incorporated into apprenticeship training? 

Michael Davis: As the Minister knows, I am also chair of governors at Leicester college, which has an apprenticeship training agency. That is one of the really good examples of how you support small businesses. The apprentice is employed within the agency housed by the college or the provider, which takes away many of the employment regulations—it does not take away the responsibilities, but it eases the burden—and supports the individual in an apprenticeship. Another example is group training associations in which an apprentice is shared among a number of employers. So there are burdens but, equally, you are seeing a number of innovative responses coming through from sectors, employers themselves and providers to address them positively. 

Mark Farrar: I would endorse that. We certainly have advisers on the high street directly assisting SMEs, which do need such help with the paperwork and the form filling that is required. We have some pilot models of group training associations running, which seem to be proving successful and enable us to share the burden on employers. Equally it allows the young person involved to widen their experience, because it is difficult, particularly in the current climate, to get all the experience you need in one firm. 

In the context of training in more general business knowledge, I believe that you can have your trades in construction and professions bang up to speed, but

There is only so much you can do in the early days of that, although you can provide some training, because other factors come to bear, such as the carbon agenda, that need to be accommodated. We are focusing particularly on SMEs and trying to assist them at the moment on how to survive a recession, how to engage and how to compete for business, and some of them might not have had to do those things before. These things are actively being pursued, but all sectors will be experiencing this in different ways. 

Q 351 Mr Stuart:  Do you think that programme-led apprenticeships were sometimes useful and that the Government urgently need to introduce some sort of course that helps to make people ready to start an apprenticeship proper? 

Mark Farrar: In construction, we have never engaged with programme-led apprentices as they existed in other sectors. We were quite wedded to ensuring that we had employer engagement from the off. Indeed, at the moment we are looking to work with schools on what we are terming “Pathways to Construction”, where we are organising between employers and young people a 16-week training programme as a block release somewhere in there as part of their experience. 

That sits alongside a very successful young apprenticeship programme that has been operating. The statistics from that programme show a high proportion of those students moving on either into a full apprenticeship or elsewhere into the industry. At the moment, a lot of time and effort has been invested by employers in our construction and built environment diploma. Even my own chairman and his construction company, the Wates Group, have put a lot of time and money into web-based activities or resource going into schools to assist with pulling that throughput through. We have had some good models working down in Wales. So I do not think that it is a case of any one model working. There are two or three models, certainly in my own sector, that are operating successfully. 

Michael Davis: The employed status of an apprenticeship is critical and it is the defining feature of what an apprenticeship is. We have seen a reduction in the number of programme-led apprenticeships during the last 12 months and the system seems to have coped with that. So making the employed status a defining feature is very important. When you talk to employers—one of our commissioners is himself a former apprentice—about the value that comes from an apprenticeship, it is inextricably linked to that employed status. 

Q 352 Mr Stuart:  The Bill places what I view as a very welcome requirement on schools to bring in professional careers advice. Would you welcome it if that careers advice, when it is provided, offered information about both vocational and academic routes? Would you welcome it if that provision was explicitly in the Bill? Do you think that that might be helpful? 

Michael Davis: Yes. 

Mark Farrar: Yes, I subscribe to independent professional advice on this subject and my understanding is that there is a commitment to an all-age service. We would

Q 353 Mark Hendrick:  The 1980s and early 1990s saw the demise of traditional apprenticeships in many ways and the introduction of schemes such as YTS—the youth training scheme—and YOP—the youth opportunities programme. In my view, they were a poor substitute for apprenticeships. Now that there is cross-party agreement on the importance of apprenticeships in the 21st century for a modern industry, do you think that there is a role for the industry training boards, such as the construction industry training board, many of which were abolished in the past? Do you think that there is a role for more of them in the future in providing more of the traditional longer-term apprenticeships, whereby firms made commitments to apprentices and offered them good prospects for the future? 

Mark Farrar: We are not the only one, but certainly the construction industry is a very diverse industry. There is a long tail of smaller employers—the SMEs. I believe that the model that we are operating allows us vertically to integrate—that is how I would describe it—standards, skills council and educational qualifications with, in our specific case, an employer-funded grant scheme through our levy. That is done through the targeted delivery on the ground, where others simply cannot go. It might be targeting training, or whatever. It works and works well. It enables a speed of response and the industry is certainly very engaged. I am scrutinised from various directions. The one that catches my attention every day is the industry’s own scrutiny of us. It is a model that, certainly for our sector, has worked. It is a blend of different approaches and it has some substance and longevity behind it. I would imagine other sectors would vary in what would or would not work there. 

Michael Davis: I come back to my earlier point. We should hope for sectors defined by their own bottom-up sense of leadership, and their primary skills challenge and how best to resource and support it. Mark has described the model that works well for his industry. Others would say that is not the model that works for theirs, because of how they are constructed. It is important to understand that skills are derived from the wider strategy or the wider ambition that sits within a business. You then expect unique solutions to come forward. 

Q 354 Mark Hendrick:  In the past there was no software industry, nor any of the modern high-tech industries that we see today As newer industries come on, is there a way in which the old EITB could have a renaissance and apply to the newer industries? 

Michael Davis: In the sense that the skills that those industries are developing take time to form. For me, institutional form follows after the strategy and the sense of direction that an industry wants to follow. The risk is that you put the form in front of the function that you are seeking to pursue. Then you end up boxing it in to be something that it is not. 

Q 355 Mark Hendrick:  The problem surely is that we have huge skills shortages in many important sectors of the economy. Students are not choosing those subjects at university or earlier, so there are shortages across the board. Is there any way we can stimulate that? I am not suggesting a levy on industry, for example, but maybe industries could get together and replicate some of the organisations that used to exist and provide support of the type that we need. 

Michael Davis: There are two parts to that. One, as we have discussed, is the importance of advice and guidance in the system, that help individuals make the most informed choices. There should be more information about where the income opportunities lie. Then individuals will start to follow where the learning opportunities are that give them the greatest wage gain. From our perspective, sector skills councils are well placed to achieve that sector reach and to define the appropriate solution for their sector. 

Mark Hendrick:  If sector skills councils are doing the same job, then fine. I wondered about which model best suits industries. 

Q 356 Kevin Brennan:  The Bill gets rid of the apprenticeship entitlement, which was a requirement on the chief executive of the Skills Funding Agency to secure a sufficient number of apprenticeship places for young people in the area within reason. Do you think that there is any danger that taking that away—you always have to have a number of employers—might take away some of the drive within the Skills Funding Agency itself to push for more apprenticeship places? 

Mark Farrar: The stark reality we deal with is the need for work, physical output for any organisation, which allows it to take the risk—and it would be seen as a risk—of employing X number of apprenticeships. That dominates all other factors on this. I am placing reliance on the fact that, because of the ongoing priority for apprentices and the funding that is being allocated in behind them, there will be sufficient support from the public sector to bolster the commercial sector’s approach to this. From within the Skills Funding Agency, therefore, I do not necessarily believe on the financial funding side of it that that will make a significant difference. If I speak again of my own sector, we are pushing as hard as anyone to get those apprenticeships in and that will not change. 

Q 357 Kevin Brennan:  Michael, it is fine if you want to comment on that. However, can I also ask you for a response on this matter? John Widdowson, the principal of New College Durham, said that he felt the number of 16 to 18-year-old apprenticeships were likely to decline in the next couple of years. There are obviously economic reasons for that. Is that something that you and the UKCES in your scanning of the likely skills needs have picked up and think might happen? 

Michael Davis: To answer your first point first. The Bill’s amendment is a pragmatic response. It seemed a responsibility that would be very difficult to fulfil, because ultimately an apprentice is employed by a business. I do not see that that would in any way change the emphasis that the Skills Funding Agency is putting upon it. The demand for individuals clearly outstrips the number of places currently available, so that is positive. 

On the second one, as the answer was being given, I was trying to flick through the data. If there is any, it will be in response to the economic conditions and employers simply not employing rather than any change in approach or attitude from businesses themselves. 

Q 358 Kevin Brennan:  If we see apprenticeship growth, is it more likely to have come from what can be described as the low-hanging fruit of people already in employment, perhaps at an older age, being re-assigned from what they might have done at Train to Gain in the past and perhaps doing an apprenticeship within an existing employment, rather than seeing apprenticeship growth among young people seeking work for the first time? 

Michael Davis: No, the emphasis is in the actions that you see from the Skills Funding Agency and the National Apprenticeship Service on finding strong apprenticeships for young people and supporting them. 

Q 359 Kevin Brennan:  So do you predict—because it is your job to scan such things—that, in the next couple of years, there will be stronger growth in the number of apprenticeship starts among 16 to 18-year-olds than the older group? 

Michael Davis: That will only be caveated by what goes on in the labour market at large. An apprenticeship or an employment opportunity sits within the overall state of the labour market, so it will be challenging. 

Q 360 Kevin Brennan:  I understand that, but it is a fairly simple proposition. Would you expect to see stronger growth? Your previous answer seemed to suggest that you would expect to see stronger growth among 16 to 18-year-old apprenticeship member starts than you would among older age groups. Are you standing by that as a proposition? 

Michael Davis: Yes. 

Q 361 Julie Hilling:  My question is totally different. I think you, Mr Davis, said earlier that you saw the STEM subjects as important. The English baccalaureate does not contain a number of subjects to which you referred. What would you like to see in an English baccalaureate, as a standard qualification that young people would expect to do? 

Mark Farrar: Can I start my answer somewhere else? Our industry put a lot of time and effort into the existing construction and the built environment diploma. It has other routes. There are apprenticeships, and there is clearly the traditional academic route through into

Michael Davis: It is not an area of specific expertise of mine, so I cannot add anything more to what Mark has said. 

Q 362 Julie Hilling:  Do you think that there is a risk that the schools are being focused on history and geography—the academic bit? I have certainly heard it from apprentice providers in my area that technology has been a key plank whereby their young people can go into engineering. Do you think that those subjects will not be on offer in school? 

Mark Farrar: One of the things required in this country is something that motivates young people and acts as the background wrapper to their education. It clearly needs to include basic numeracy, writing and communication skills. I can only speak for my own sector. We find that it is useful, probably because, unlike France or Germany, we do not have an artisan pull through on the technical master craftsman side as a country. Some degree of push and encouragement is needed that takes us into vocational qualifications. Beyond that, we must get the right balance and the right sort of vocational training locally. It is not necessarily to make the job ready or directly lead them in, but just to encourage them and give them a breadth of experience on the way through. 

Q 363 Kevin Brennan:  Alison Wolf said in her report today said that there is a risk that the English baccalaureate could do that. Do you think that she is right? 

Mark Farrar: You have clearly got further down Alison Wolf’s report than I have managed to in the time available today. 

Kevin Brennan:  Page 136. 

Mark Farrar: Thank you. I shall refresh my knowledge. 

3.45 pm 

The Chairman adjourned the Committee without question put (Standing Order No. 88).  

Adjourned till Tuesday 8 March at half-past Ten o’clock.