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Lord Lucas: Yes, my Lords, I agree with much of what the noble Lord said. When the GNVQ system was introduced it was in many ways a very new system. We of course knew that it would turn out to have many faults. The question is how they should be dealt with. To our mind they have been dealt with extremely well. I believe that there is a common, and right, perception that a lot of the faults in the system have been shown up as overload on the teachers. The teachers have responded to that extraordinarily well, not least because I believe that they see how good the examinations are for their pupils and how much hope they offer for the future. But we clearly need to deal with these problems. We are bringing in a number of important changes in September and will doubtless follow them with others.

Baroness David: My Lords, does the Minister agree that the criticisms made show the need for a review of the whole area of post-16 qualifications to ensure that courses for academic and vocational qualifications are equally well prepared and equally valued? Does he further agree that a unified qualification for post-16 year-olds is what is really needed?

Lord Lucas: My Lords, apart from the last part of the noble Baroness's question, I do not think that I would disagree with her at all. As she will be aware,

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we have just announced such a review. The question of whether the qualification should be a unified one or a number of separate qualifications which are made coherent and properly linked is one on which we can have a long debate. But I believe that the option that we are pursuing of a coherent series of linked examinations is likely to prove much more flexible in covering a very wide range of requirements.

Lord Quirk: My Lords, is it the case that of the 160,000 who are currently registered for GNVQ only 2 or 3 per cent. have opted for the manufacturing option? If that is true, what explanation can the Minister offer? May I ask also whether it is the case that about half of the 160,000 who are currently registered for GNVQ are going for the advanced GNVQ and whether that is a sign that the advanced GNVQ is achieving that longed-for parity of esteem with the advanced level of GCE?

Lord Lucas: My Lords, to answer the second question first, yes. We believe that that parity of esteem is on the way to being achieved. Clearly, one needs a little bit of history and a little experience before one can say that it has actually been achieved, but we are confident that we are moving in the right direction. Perhaps I may characterise the manufacturing GNVQ as the runt of the litter: it has not done as well as the other qualifications. We are giving it particular attention and support. If I were to hazard a guess as to its problems, I think that it has been directed a little astray from where it should have been and therefore has not proved as attractive to industry and people interested in industry as should have been the case.

Baroness David: My Lords, following the Minister's earlier answer to the noble Lord, Lord Quirk, when he mentioned the "overload on teachers", what is being done to make the teachers' load less heavy in the light of what we know about the teachers' situation at the moment?

Lord Lucas: My Lords, I shall write to the noble Baroness with the details, but it is very much involved with reducing the burdens of assessment and record-keeping and with ensuring that the whole system works to remove unnecessary bureaucratic overload.

Transport Research Laboratory

2.52 p.m.

Baroness Castle of Blackburn asked Her Majesty's Government:

    Whether they will state their latest decisions with regard to the privatisation of the Transport Research Laboratory.

The Parliamentary Under-Secretary of State, Department of Transport (Viscount Goschen): My Lords, the Secretary of State for Transport announced on 14th March 1995 his objectives for the sale of the Transport Research Laboratory, which he aims to complete during 1995. He will be seeking bids for the

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laboratory from a wide range of interests. He also announced his decision to provide the laboratory with guarantees of future research work for a number of years, subject to the delivery of high quality, independent and impartial research at competitive prices.

Baroness Castle of Blackburn: How can the Government justify giving guarantees of future research work for an indefinite period to a private buyer of the Transport Research Laboratory which they have refused to give to the TRL, their own acclaimed centre of excellence, as long as it remains in public hands? Does not that favouritism for private enterprise show that the Government are afraid to allow the public sector to compete on equal terms, as we found in the case of British Rail?

Viscount Goschen: My Lords, no. I do not believe that it shows that at all. We believe in a strong Transport Research Laboratory, and we believe that the best future for that institution lies in the private sector, where it will be able to compete and enter new markets. The guarantees will not be indefinite, but because the Government account for a major share of the work commissioned from the TRL—some 85 per cent.—we feel that it is appropriate to give guarantees of future research work in order to transfer that organisation smoothly into the private sector.

Lord Dean of Beswick: My Lords, in view of the fact that there has been no criticism of the performance of that organisation in the past, can the Minister now tell us the real reason that it is being sold off—other than political ideology?

Viscount Goschen: My Lords, it is not a question of political ideology. The fact is that the Transport Research Laboratory has faced a loss of business. Given the fact that there has been a change and that rather than the laboratory's work being provider-led, departments are now customers, and in view of the fact that the Government's share has declined, we feel that if the research laboratory is to be able to compete properly, to enter new markets, to go for new business and to raise money in the way that it wants, its best future lies in the private sector. We strongly recognise the value to this country of having a strong TRL.

Lord Dean of Beswick: My Lords, but what proof does the Minister have that this is the right course to adopt if, once again, the Government are only guessing?

Viscount Goschen: My Lords, it is not a question of guesswork. The TRL has lost business. That is the case. We recognise that it is a centre of excellence, but it is constrained by being in the public sector. It cannot, for instance, price its products in the way in which a commercial organisation can. It cannot provide loss-leading products—

Baroness Fisher of Rednal: My Lords, why not?

Viscount Goschen: My Lords, as a public sector body, it has to reclaim its costs. Therefore, it cannot compete on an equal basis with what will be its

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commercial competitors. We believe in a strong organisation. The private sector will be the best place for it.

Lord Mackie of Benshie: My Lords, is it good commercial practice to get a good price for a saleable object by promising to pay a large income to the same seller?

Viscount Goschen: My Lords, I believe that I have covered the reasons that we feel that the guarantees are necessary. The fact is that the Government commission some 85 per cent. of the work of the TRL. It is because the Government are by far and away the largest customer of the organisation that we believe that those guarantees are necessary in order for it to move smoothly into the private sector.

Lord Renton: My Lords, when the Government are requiring more work to be done by the TRL, can my noble friend say whether the criterion is to be the public need for such work or whether it will be done without cost?

Viscount Goschen: My Lords, my noble friend asks an interesting question. In the past, the Transport Research Laboratory conducted its research as a provider rather than at the customer's request. Now that government departments and others hold budgets for such research, it is demand-led. Departments decide what research they need and they then have the option to commission that research from TRL. The Transport Research Laboratory has a very good reputation as a centre of excellence, and I am sure that government departments will continue to commission research from that body.

Baroness Farrington of Ribbleton: My Lords, I wonder whether the Minister could be a little clearer. First, he referred to the TRL benefiting from the fact that in the private sector it would not be required to reclaim its costs. That is what I inferred from the noble Viscount's comments, but it was a slightly confusing statement. Secondly, will the Minister confirm that it is possible for the Government, through deregulation, to allow a public sector body to compete in the open marketplace and that therefore privatisation is not necessarily the answer to such an organisation's inability to compete when that inability is due to government restrictions?

Viscount Goschen: My Lords, no. I do not agree with the noble Baroness. However much one deregulates and moves such an agency towards an arm's length position, ultimately it is a public sector body and therefore cannot compete on the same terms as a commercial body with government money behind it. The noble Baroness was confused by my statement about the recovery of costs. A commercial organisation has complete leeway when deciding how to price its products. It might loss-lead, for example, and provide

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services to its customers at a lower cost than they cost the organisation. That is not possible for a public body because a public body must recover its costs.

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