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Lord Brougham and Vaux: My Lords, I am grateful to the Minister for raising this matter. I much appreciate the time that he and his colleagues spent

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discussing the matter at a dinner the other night. I believe that that discussion was fruitful and that, with a bit of push and shove, we shall get somewhere.

Lord Whitty: My Lords, I hope that it does not require much of a push and shove. However, pushes and shoves from the noble Lord are always welcome. With that, I thank my noble friend Lord Davies for initiating the debate.

Learning and Skills Bill [H.L.]

8.44 p.m.

Consideration of amendments on Report resumed.

Baroness Sharp of Guildford moved Amendment No. 42:

    Page 4, line 34, at end insert--

("( ) The criteria specified pursuant to subsection (3) above shall amongst other things take account of local circumstances.").

The noble Baroness said: My Lords, Amendment No. 42 returns to the issue which the House debated before the adjournment in the context of an earlier amendment concerned with the powers of the learning and skills council in relation to funding issues. This amendment is related specifically to the requirement for colleges and other institutions to set fees and other charges according to specified criteria.

In his reply at Committee stage the noble Lord, Lord Bach, stressed the need for the learning and skills council to have flexibility and to exercise flexible judgments (as he put it) about the financial agreements that it needed to reach with providers. He rightly pointed out that the Further Education Funding Council dealt only with a relatively homogenous group of providers, namely the further education colleges, and that the learning and skills council would have a highly diverse group with which to deal. For this reason, the need for flexibility was all the greater. We do not deny that. However, it is precisely for that reason that we on these Benches tabled the amendment.

It has been put to us from a number of sources that, flexibility or no, the powers embodied in Clause 6(3) are considerable and give the LSC power to impose a fee structure on any provider, be it a college or other provider. Yet fees which might be acceptable in the south-east of England, where unemployment has fallen and incomes are high, would be wholly unsuitable in, say, Cornwall or Sunderland. For that reason we ask that the criteria which are specified in these cases should include local circumstances. It is vital that there is local flexibility. I beg to move.

Baroness Blackstone: My Lords, the noble Baroness, Lady Sharp of Guildford, indicated in Committee that she would return to this issue and expressed concern that a national fee scheme could not work. National arrangements are already in place and operated by the FEFC in relation to fees for further education provision. For example, a national fee

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exemption policy applies to those who are unemployed and in receipt of benefits or to 16 to 19 year-olds who are undertaking full-time education. This amendment would obstruct those arrangements. I hope that the noble Baroness agrees that fee exemption arrangements for the disadvantaged and vulnerable should not be a matter for local discretion but rather national policy.

There is a range of areas in which the LSC will need to make assumptions about fee levels by reference to national criteria and local discretion may not be appropriate. There will need to be arrangements for the fees of home and overseas students and it is likely that those will need to take account of the national fees and awards regulations already in place. More particularly--this will be the subject of further consultation that is to start in May--the LSC will need to establish benchmarks against which fee levels can be established for the many thousands of programmes that it will fund. Against those benchmarks it must determine the level of public funding that it will provide where there is a case for a contribution from the student or employer.

Let me try to illustrate the point by way of an example. The LSC may determine that the proper cost of a particular full-time course is £2,000. It would set that as the fee level. If one assumes that for a particular type of provision 25 per cent of that cost should be met by an employer, then it would be clear and transparent that the LSC would pay £1,500. Establishing national assumptions about rates of grant and about fee levels will enable everyone to know what the starting point is.

Of course, nothing in Clause 6 would prevent the LSC from responding to local circumstances by providing an additional contribution if that were warranted. That is why local LSCs will have the flexibility to vary from national funding tariffs so that they can respond to local circumstances and needs. We think that it is essential that they have the flexibility to make proper allowance for the variation in costs associated with different groups of learners and skill types.

As I have indicated, we shall be conducting a detailed consultation on these and other funding issues in May. There will certainly be a role for the local arms of the LSC in responding to local circumstances. But the present amendment would inhibit the establishment of policies which, quite properly, should be set at the national level. I hope that with that explanation the noble Baroness will withdraw her amendment.

Baroness Sharp of Guildford: My Lords, I am grateful to the Minister for her explanation. In some degree it conflicts with the evidence presented to us from a number of colleges. I need to talk again to them about their worries. We tabled the amendment because of worries expressed to us by those colleges.

The Minister assures us that the local learning skills council will have flexibility in its provisions. From her response, there seems to be sufficient flexibility written into the procedures. Therefore I beg leave to withdraw the amendment. However, I may wish to return to the issue later.

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Amendment, by leave, withdrawn.

Clause 7 [Funding of school sixth-forms]:

Baroness Blatch moved Amendment No. 43:

    Page 5, line 11, at end insert--

("( ) In making a grant to a local education authority, the Council must take account of a maintained school's choice to provide minority subjects or to provide mainstream subjects to low numbers of students when the consent of governors and parents is established.").

The noble Baroness said: My Lords, I return to the funding of sixth forms. Clause 7 states that the council may make a grant to a local education authority, and sets out the conditions. Clause 7(2) states:

    "A grant made under this section may be made on conditions in addition to the condition mentioned in subsection (1)(a) above (including conditions of a kind which could be imposed under section 6)".

Clause 6 sets out,

    "for the provider to charge fees by reference to specified criteria; ... for the provider to make awards by reference to specified criteria; ... for the provider to recover amounts from persons receiving education or training or from employers (or from both)".

I do not know whether that provision refers only to a place of work. These conditions do not appear to have a great deal to do with sixth forms. Clause 7 refers to "section 6". Clause 6 states that the conditions may,

    "require the Council or a person designated by it to be allowed access".

Clause 6(3) states:

    "The conditions may require a person providing post-16 education or training ... to make arrangements providing for all or any of the following".

I could go on listing the conditions in Clause 6. However, I return to the theme of local flexibility, referred to earlier today. Where a positive decision has been made which parents and governors have accepted and supported to teach minority subjects or to teach subjects to small groups, that policy should be properly recognised.

The amendment deletes Clause 7(2) and replaces it with the following:

    "In making a grant to a local education authority, the Council must take account of a maintained school's choice to provide minority subjects or to provide mainstream subjects to low numbers of students when the consent of governors and parents is established".

I hope that the amendment speaks for itself. I am greatly concerned that the conditions set out in Clause 6 are in addition to the condition set out in Clause 7(1)(a). I beg to move.

Baroness Blackstone: My Lords, on Amendment No. 43 I remind the noble Baroness that under the new arrangements LEAs will still have the same direct interest in the planning of school sixth form provision as they do now. They will need to consider ways of providing a wide choice of options for pupils when doing so. Small classes are not the only or indeed the best way for schools to be able to offer minority subjects. Where a sixth form cannot offer sufficient curriculum breadth, or pupils are being taught in isolation, LEAs and schools will be able to explore

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other, more sensible, means of provision. This includes collaboration or co-operation arrangements between one or more schools with sixth forms or between schools and FE colleges. Such arrangements can help ensure that the widest possible choice of options is available and that school sixth forms remain dynamic and attractive to potential students and their parents. I am sure that the noble Baroness will agree with me that that is something we should encourage.

The noble Baroness has expressed concerns about how the LSC would react to a decline in numbers in a sixth form, and has suggested that it might automatically seek to close such sixth forms. She has also said that the Bill could be a threat to small sixth forms in general. I want to take this opportunity to reassure her once again that there is no such threat. The LSC does not have the power to propose closure in relation to size, only in relation to quality. The Government are committed to maintaining a broad base of learning provision for 16 to 19 year-olds and within that good sixth forms, whatever their size, will continue to play a vital role. The Bill is in no way an attack on small sixth forms. But we have made a commitment to drive up standards, and that means that the Bill contains clear measures in relation to poor quality sixth forms, whether they are small or large. As I mentioned in previous debate, those sixth forms which are struggling to make the grade will be given the opportunity to turn themselves around. We do not, however, want to see sixth form pupils let down by weak provision, and high standards must be the aim.

For those reasons, I cannot accept the amendment the noble Baroness proposes. It would cut across the need for LEAs to make sensible judgments about their plans for local provision and it would discourage schools from selecting cost-effective means of offering a viable and attractive range of sixth form provision.

Turning to Amendment No. 44, the LSC will have a wide remit to fund a diverse range of providers, and school sixth forms are at one end of that spectrum. For that reason, the powers to impose conditions of grant, as laid out in Clause 6, need to exist, or there would have to be specific reference to every type of provider within the Bill. I am sure the noble Baroness will agree that this would be unwieldy. However, under subsection (2) of Clause 7 we recognise the special nature of the grant made to schools and, in doing so, recognise the need for some continuity between the conditions of grant for pre-16 and post-16 funding for schools.

We are clear that LEAs will continue to make decisions, as now, as to the allocations to individual schools from their sixth form grants. These allocations will continue to be governed by regulations made by the Secretary of State. And we have said that individual schools may continue to vire money between their pre-16 and post-16 provision. Indeed, we have made clear that the overall system will work much as at present with the LSC providing funds to LEAs in the interests of coherence right across the post-16 learning spectrum. The conditions which the LSC might attach to its sixth-form grant to LEAs would not cut across any of that.

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By accepting the amendment and leaving subsection (2) out of Clause 7, we would be leaving the door wide open for LEAs to receive or spend their grant without reference to entirely reasonable guidance or rules of propriety. The LSC might want, for example, to require that LEAs supply evidence on pupil numbers and related data for their areas. The council would be put in a position to check such data. Another example might be a condition that the LEA in question supplies the LSC with copies of the published budget statements relevant to each school with a sixth form. Those are the kind of conditions which support the Secretary of State's funding guarantees to school sixth forms.

I understand that the noble Baroness might be concerned about the council having undue control over LEAs, but I assure her that that will not be the case. The conditions which might be made under subsection (2) would be those which rightly attach to public funding in the interests of protecting its proper use.

The noble Baroness might want to bear in mind the fact that we have no intention of imposing conditions on sixth forms that have not been fully considered. That is why we are consulting widely and are in discussion with key partners on a number of issues related to sixth-form funding. We have not made those issues plain on the face of the Bill because they are not matters for primary legislation. However, we shall issue appropriate guidance when the time comes and I shall ensure that the noble Baroness receives a copy.

I hope that the noble Baroness will support the need to ensure that public money is spent wisely and with proper accountability, including in school sixth forms, and that she will not feel the need to press her amendment.

9 p.m.

Baroness Blatch: My Lords, I found the Minister's answer deeply worrying--even more worrying than at first. I thought that I was pretty neurotic about the provision, but there were many inconsistencies in the noble Baroness's answer. She said that the conditions would not cut across and that there was no intention of imposing conditions on sixth forms. She said that it might be necessary to provide information on pupil numbers and related data. My goodness, there is not a school in the land which does not provide such information! They state the number of pupils; their ages; their achievements in examination and at the key stages; attendance on any given day; the number in a class; the number of teachers available; and so forth. If the Minister is referring to information over and above that already provided specifically for sixth forms as well as for every other age group, it would be helpful to know tonight what that might be.

I have looked again at Clause 6 and find it worrying. The first part relates to access and checks on the technical equipment and the people who will be providing the courses. Subsection (3) contains the list to which I referred earlier about charging fees; making

13 Mar 2000 : Column 1378

awards by reference to specified criteria; recovering amounts from people receiving education or training or from employers; and amounts to be determined by reference to specified criteria. None of that subsection can be applied to a sixth form unless there is an hidden agenda to charge fees and recover amounts of money.

Subsection (4) relates to disabled people. There are already requirements on local authorities to make provision for young people with disabilities. The statementing system, which we tried to have extended beyond the age of 16 outside schools, works extremely well in schools. Subsection (5) enables the council to require the payment in whole or part of sums paid by it if any of the conditions subject to which the sums were paid are not complied with. It then requires the payment of any interest in respect of any period in which the sum was due to the council. Subsection (6) gives a definition of "disabled persons".

I find it extremely disturbing that the noble Baroness still defends the council's right to impose conditions and to relate some of them to Clause 6. Clause 7(1)(a) states:

    "on the condition that the grant to be applied as part of the authority's local schools budget for a financial year".

However, I would accept that as read. Ministers in this House and in another place have constantly said that schools will continue to be funded at sixth-form level as they are at present. Therefore, Clause 7(1)(a) comes as no surprise and I am pleased to see it as some form of reassurance. If money were given to schools and not used for the purpose for which it was given, there would be considerable worries.

But why have Clause 7 at all? There is not a school in the land which does not receive grant for the education of children; which is fully accountable through the inspectorate and an auditing system; and which is accountable to its governing body, its LEA, its parents and the Secretary of State. What on earth is Clause 7 about, other than giving the council the power to make the grant?

I can understand that, but the Minister prayed in aid that Clause 6 should apply. She gave no reason other than the provision of information, all of which is currently provided. She did not say what in Clause 6 might be pertinent to conditions which may be imposed--that word is used in the Bill--on sixth forms by way of funding; in other words, funding given on the condition that certain things must be done. It is incredible to think that there is further information in addition to that which is already provided by school sixth forms. Can the noble Baroness say what part of Clause 6 would be pertinent to sixth forms in future arrangements?

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