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Baroness Blatch: Before the Minister sits down, the noble Baroness referred yet again quite specifically to £50 million worth of savings. Can she say how that has been arrived at? Can she give some estimate of the cost of putting into place the new ConneXions proposals contained within the new document? Also, can she throw some light on the fact that in the Financial Memorandum the Government say that it is not yet possible to provide details of the resources that could be made available for powers to provide services for use? The Government also say that it is not yet possible to provide an accurate estimate of what may be needed for the extension of Ofsted duties and that the expenditure required for the setting up of the new adult learning inspectorate and the transformation as regards the FEFC will not rise substantially. They have also said that it is too early to provide an accurate estimate of the extent of the transitional costs of putting in place the new arrangements for the Welsh authority. How can the Government be so specific therefore about saving £50 million?

Lord Hylton: At the same time, will the Minister reply on the issue of democratic accountability which was so forcefully raised by the first two speakers?

Lord McCarthy: Perhaps when the noble Lord, Lord Tope, responds, he will tell us what is meant by the "democratic deficit". As far as I can see from looking at the amendments--I may have got it wrong--nobody is proposing direct elections. What sort of democratic influx is there to be? For example,

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are we to take it from the Opposition that direct elections or elections of some kind are now the Conservative Party's policy? They never were in the past. They were all quangos. They were formed and then abolished, but they were never democratic. Can we be told in what sense they are to be democratic, which ones are to be democratic and how they are to be elected?

3.30 p.m.

Baroness Sharp of Guildford: Can the noble Baroness also say why it is assumed that it is at the national level that the strategic over-view is required? In Germany and the United States the concept of strategy takes place at a much lower level. In Germany it is at the La nder level. Even here in the United Kingdom, Wales and Scotland have their own models. We had a national model before called the Manpower Services Commission. It was a pretty disastrous model. One reason why it was decentralised down to the TECS was to try to emulate the German model at a more local level. I do not believe that the TECS have been perfect.

One of the problems we now have is that the Government have created a hybrid in the local learning and skills councils. They are neither at the strategic regional level, such as the regional development agencies, nor at the local executive level for local authorities to which we are looking to perform many of the functions of this council. We have here a hybrid stuck between the two. I understand what the Government want to do, but the model has been tried and it failed. I do not understand why the Government reject the regional model which implicitly we are operating in Scotland and Wales. If we tried, we could operate it in England as well.

Baroness Blatch: Perhaps I may return to the specific question of the democratic deficit. I and our colleagues on the Liberal Democrat Benches have amendments to key into the process local authority representation. That will go some way towards getting some local input into this matter. The other point which disturbs us concerns the top-down approach. The directions will come from the Secretary of State to the national council and then cascade down to the local councils. Then local education authorities and local authorities will have to produce plans in conformity with the instructions that come from the top. That is not a bottom-up system, but very much a top-down one without any democratic representation at all.

Baroness Blackstone: I indicated at the beginning of Committee stage this afternoon that I believed that we should try to be orderly and not anticipate amendments which have to be dealt with later on, otherwise we shall never reach the end of what is quite an ambitious day's business. I do not want to go into the issues that the noble Baroness has just raised relating to later amendments. I do not believe that it would be right at this stage to go into issues as regards ConneXions because they will be raised on a later date. Also, I do not wish to go into matters concerning the

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extension of Ofsted's role of inspecting FE colleges and sixth-form colleges and neither do I wish to go into issues concerning Welsh authorities.

I have already explained to the noble Baroness on a previous occasion how the figure of £50 million was reached so I am a little puzzled as to why she is asking the same question again. That figure does not relate to the overall savings from the entire ramification of changes that are brought in as a consequence of the introduction of this Bill. However, it relates to the new structures of a national learning and skills council, along with 47 local learning and skills councils, instead of 72 TECS, the FEFC and its regional committees.

I say once again to the noble Baroness that our assessment is that there will be savings of £50 million. They come from two main sources. First, they come from savings on operating through 47 instead of 72 bodies. Savings will also be made partly through operating more efficient systems and also through some savings on the provision of accommodation. These savings have been fairly carefully put together. I am a little surprised that the noble Baroness has yet again asked for information about them.

I now turn to the issue of the democratic deficit.

Lord Tope: I am grateful to the Minister for giving way. The noble Baroness has explained again how the savings arise. Can she explain to us what will happen to them? Will they be put to the general benefit of further education or will they simply disappear back into the large Treasury pot?

Baroness Blackstone: An incredible improvement is anticipated over the previous situation as regards the availability of further education and a new ConneXions service for young people. The Government intend to spend more money on making sure that all young people and far more adults gain access to the learning and skills that they need. We shall be able to reinvest the savings so that they reach the learner rather than be soaked up in bureaucracy.

I return to the issue of democratic accountability. Again, I find it very puzzling that the Conservative Opposition is raising questions on this matter when the previous government took local education authorities out of this area completely. The LSC will be accountable nationally to the Secretary of State. The local LSCs will be accountable to LSC councils which will comprise local people. I accept that they will not be elected in the normal democratic fashion as for a local authority. But we have many structures of that kind throughout our system. I believe that this is the right approach to take in this area. It builds on what the previous government did in certain respects.

The noble Baroness, Lady Sharp of Guildford, referred to the German federal system. We do not have such a system in England or the regional assemblies with which the Liberal Democrat party is so enamoured. I do not believe that it is right to claim that the TECs follow the German model because they are of quite a different construction.

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I repeat what I have already said. I believe that the appropriate way is by having a structure with a national body that attempts to identify the needs for national skills and to work out appropriate systems for funding those needs; with local arms that can meet the needs of local communities and which have some degree of flexibility in how they spend and control part of their budgets. Of course, it is absolutely vital that the local LSCs work with both the RDAs that cover their area and with the local authorities. Having said that, I very much hope that once again the noble Lord will be able to withdraw his amendment.

Lord Tope: When the Minister first responded she described this set of amendments as going to the heart of the Bill and I entirely agree with that. They are intended to do so. I believe that I said in my opening remarks that they address one of the principal concerns that we and many others have about these proposals. Therefore, we are agreed from that point of view.

She also described them as wrecking amendments. I totally reject that. They are not intended to be and I do not believe that they are wrecking amendments, but a genuine attempt to try to produce a better, simpler and clearer structure which is less complex, bureaucratic and less undemocratically accountable, if I may put it in that strange way.

The noble Lord, Lord McCarthy, asked about the democratic deficit. I say straight away that the current policy of the Conservative Party on that subject is as much a mystery to me as it is to him. I am quite certain that the noble Baroness, Lady Blatch, would no more wish me to answer for the Conservative Party than I would wish to do so.

Perhaps I may answer for my own party. When the noble Lord reads the report of the debate in the Official Report tomorrow, he will see that I tried to cover in my opening speech what I saw as the democratic deficit. I shall not bore the Committee by repeating that. I tried to explain that while I accept that the model we are proposing is not perfect, it is certainly better. It proposes just nine local regional and skills councils. I accept that they are not democratically elected and that they are appointed by the Secretary of State until such time as we have the regional assemblies with which we are so enamoured. However, the work below that level will be carried out by the local authorities and the lifelong learning partnerships in which local authorities play a significant role. That addresses the democratic deficit--not a great deal and not enough, but significantly better than is the case with these proposals.

I have a very real concern that if this is to be successful, as we all hope it will be--I certainly hope so--it needs to be firmly rooted in local communities. I do not believe that the proposals in the Bill will do that, but the proposals that these amendments try to encapsulate will do it very much better. However, I shall not pursue the matter further today, although I

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suspect we may well return to these issues at later stages of the Bill. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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