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As other speakers have said, foundation degrees are still at an early stage in their struggle to gain acceptance among employers and potential students. Having been party to their invention I really want them to succeed; so I beg the Government not to do anything that will jeopardise this important route

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to widening participation, to progression and to employability achieved through working directly with employers. After a slow start they are now growing faster and acquiring the status they deserve. That validation by universities helps to secure that status.

While being wrong in principle, Clause 19 also has a number of unintended consequences, as the noble Baroness, Lady Sharp, and other noble Lords have said. I do not want to whinge about lack of consultation. I have sat too often where the Minister is sitting to know that that does not get you very far. However, it is always better to ask around before introducing a new power of this kind, if only to become aware of the consequences.

The most worrying aspect is that the clause threatens partnership arrangements between FE and HE. Many universities have spent a great deal of time and effort in developing collaborative relationships with colleges, including allocating to them their own HEFCE numbers for foundation degrees. What will happen next? Will universities have to compete rather than collaborate with their partner colleges, which are using the universities’ HEFCE numbers; or will universities have to withdraw these allocations from the colleges and try to devise ways of teaching their own foundation degrees, or, failing that, leave the places unfilled? Surely the Government do not want that to happen. What will happen to the guaranteed progression to honours degrees that the present system offers? This proposal is immensely disruptive and provides no obvious advantage.

What will Ministers say when they host the next stage of the Bologna negotiations in London next year? There is a real danger that they will be criticised for devaluing degrees. The UK HE brand could be damaged and our position weakened in these negotiations. We should take that seriously. The noble Baroness, Lady Morris of Bolton, said that FE colleges are over-regulated, with 17 different bodies overseeing them. I have sympathy with that view. This clause will introduce yet another regulator for FE colleges, the QAA. It will do nothing to resolve what the Foster report said about over-regulation.

What will the relationship be between this Bill when enacted and the 2004 Act? It would be helpful if the Minister replied to that. If FE colleges are to validate their own foundation degrees and presumably have their own HE places, will they set their own fees and, if so, will they be subject to OFFA agreements? If so, that would impose another regulator.

I will leave other speakers to elaborate further on the threats that this change poses to the relationships between higher education and further education and to the established boundaries between the two sectors and their regulation and inspection. I end by asking the Government to think again and, having thought about it, to abandon this last-minute addition to the Bill. It will create more problems than it solves and it leaves many vice-chancellors and their senior colleagues who support the Government’s aims in establishing foundation degrees deeply concerned.

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6.08 pm

Lord Plumb: My Lords, I declare an interest as chancellor of Coventry University. Many noble Lords will remember that, before it received university status, it was a famous polytechnic college that provided skilled workers for some of the finest engineering works in the country, both in wartime and after. It then received university status and now has some 18,000 students. It has been built up over time into a university that has to be reckoned with. It has a fine international reputation with students coming to it from various countries in the Far East and from elsewhere. I know from the awards ceremonies that I attend that those students welcome the chance to spend time in Coventry and to feel part of the university.

At this stage in the debate we have covered a lot of ground. One listens with care to what people have said, and I do not wish to repeat what has already been said. I wholly support the opening statement by my noble friend Lady Morris and what has been said by speakers from this side of the House since. I would like to express my concern, and the concern of many who have approached me, about Clause 19. I will concentrate on that because the Minister referred to that clause in particular, and said that it was the Government’s intention to give further education colleges the power to award foundation degrees in their own name.

What does that mean? What effect will it have on universities and honours degree courses? These questions are being tabled and are of concern to many at the moment. I could say that we would like the Government to drop this clause completely, or at least, as the Minister said, apply some stringent criteria before further education colleges are granted their powers. Therefore, I would like the Minister, in his final remarks, to spell out a little more clearly what these criteria would mean.

I have four points of concern. First, if further education colleges are permitted to award degrees, surely the brand of UK universities will be weakened internationally. It could make it difficult for the United Kingdom to be part of the Bologna agreement on higher education. Secondly, does it not represent considerable “mission drift” for further education colleges, which were meant to be focused, as my noble friend Lord Baker said, on 14-to-19 level 2 or 3 provision, and adult level 3? Even foundation degrees, as I read and understand it, are level 4.

Thirdly, the proposal potentially drives a coach and horses through the partnerships built up between further education colleges and universities, rather than bringing them together on the basis of mutual development routes for learners, which is surely what we would all like to see. On the basis of the proposals, they would appear to be competing head-to-head instead of collaborating, as surely they should. In these cases a market solution is not necessarily in the best interests of learners or of widening the participation of students. It could jeopardise the lifelong learning networks, which HEFCE has set up and funded in each sub-region as consortia of

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universities and further education colleges. Finally, foundation degrees will be seen as further education qualifications, undermining their credibility with employers, where they are still a fragile new qualification.

Like many others, I was surprised to learn that there appears to have been a lack of consultation with the higher education sector generally. Nor has there been any modelling by the DfES of the impact on higher education provision in each sub-region, or any consideration given by Ministers or advisers to the secondary consequences of change. Surely that should have been going on long before we saw this Bill in order to debate it. I hope that the Minister can inform the House on those points and that, in particular, he will reconsider Clause 19.

6.14 pm

Baroness Maddock: My Lords, I share the doubts of my noble friend Lady Sharp of Guildford about why this Bill is before us now. Indeed, I can identify with some of the comments made by the noble Lord, Lord Baker of Dorking. This is yet another reorganisation of learning and skills councils. This point was raised by the noble Baroness, Lady Morris of Bolton; she gave figures, which I cannot at present recall. From my own experience, the learning and skills councils have, after a pretty shaky start, just about got into their stride. I have sympathy with those who believe that there are too many of them. Certainly, in their early days, they were incredibly bureaucratic, as the Minister said.

There is some muddled thinking about degrees from FE establishments. Clause 19 has been mentioned by almost every speaker today. Despite being co-chair of the University All-Party Group, I do not intend to dwell on that aspect tonight. I want to concentrate on what it is like for learners in the further education sector and to ask the Minister how educational opportunities will be improved for young people staying on in education after the age of 16 as a consequence of this Bill. Most of us recognise that further education provision is not uniform across the country. In some areas there is excellent provision, with plenty of choice and ease of access; in others, it is quite the opposite and falls well below the standard it is reasonable to expect.

I will start with the good. Earlier this year I was a member, as I had been for seven or eight years, of the board of corporation at Brockenhurst College, in Hampshire, in the middle of the New Forest. I attended it in the 1950s and early 1960s, when it was a grammar school. It then became a sixth-form college under the local education authority, then a further education college under the Further Education Funding Council, and then, most recently, an FE college under the Learning and Skills Council. Despite these ever-shifting sands of governance and funding, and due to a very good principal in Mike Snell—regrettably, now retired—it is among the top five colleges in the country. I know that the Minister has recently visited it.

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Nearby are several schools with sixth forms. My noble friend Lady Sharp talked about the different amounts of funding per student received by sixth-form colleges in our area—quite a lot more. There are other further education colleges nearby, so there is plenty of competition and choice for students in academic and vocational courses. There are very good transport links in the area, though less so to the north of the New Forest. It is a very prosperous area, so many students drive to the college in their own cars, which used to cause great problems for us in finding places for them to park. There are plenty of job opportunities locally for those students who do not go into higher education. It is a densely populated area: the conurbations of Southampton, Bournemouth and Poole are less than 20 miles away.

Now for something completely different. For the past five years I have lived in Berwick-upon-Tweed, in north Northumberland. Since May 2005, I have been a Northumberland county councillor. For the young people who live in my division of north Berwick, the picture is very different from the one I have just described in Hampshire. There is one high school with a sixth form. The next closest high school is 30 miles away. The nearest further education college is 50 miles away, in Ashington, and the next one 67 miles away in Newcastle. Efforts to establish vocational courses in Berwick, particularly in building and associated trades, have not been very successful, despite support from local tradespeople, because the tutors, I am told, do not want to travel to Berwick from Newcastle.

The area has almost the lowest average wage in England, and the take-up of FE is one of the lowest in the country. Borough and county councils have both stated that raising aspirations is vital for the whole community and its economy. The population is very sparse, with fewer than 60,000 people in the whole of north Northumberland, so further education students must travel long distances, and the cost of this travel is high.

It is not clear to me exactly who is responsible for supporting students with the cost of travel. Over the years, the county council has provided support for FE student travel costs, but that is not a statutory duty. It has been increasing the amount that students and parents contribute, and this year it rose very rapidly from £235 a year to £360. The story does not stop there. For the students in Berwick, the situation has been made even worse, because the council has stopped altogether contributing to those students’ rail costs. Little do I think the county councillors realised what they were doing. Putting on buses means four hours’ daily travel for a student going to a FE college in Newcastle, when the train journey would have taken three-quarters of an hour each way.

Other counties in our region have claimed hundreds of thousands of pounds from the Learning and Skills Council to provide support for student travel costs, but for some reason, Northumberland County Council has failed to claim that money, and it has got very little from the Learning and Skills Council. I am very pleased that that is being looked at, but it is far too late for students this year. The

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take-up of FE out of Berwick has halved, and students who were halfway through two-year courses have given up.

Which is the body responsible for help with travel costs? Those travel costs are so badly needed in sparsely populated, rural areas. It is not clear to me; I have looked in the Bill. Perhaps a provision in Clause 6 can clarify how this can be dealt with. Secondly, I hope that the Minister can convince me that the Bill will reduce the inequalities that I have outlined tonight. Thirdly, I hope that he can look into how we can get much better opportunities for FE students in north Northumberland.

Only last week, in his Pre-Budget Statement, the Chancellor of the Exchequer laid great emphasis on the need for a highly educated and trained workforce. He emphasised the rapidly decreasing number of jobs for those who have no skills; indeed, the Minister also referred to that in his opening remarks. Today, in response to a Question by the right honourable Member for Berwick-upon-Tweed, Alan Beith, the Prime Minister flagged up the fact that the economy in the north-east has improved tremendously. It is stronger than it has been for a long time. Unfortunately, it is very challenging for the young people in the area where I live to join in that prosperity, and I have clearly described that for the Minister.

It is even more irritating to some of us because Scotland is four miles up the road. I believe in devolution, but again the picture is very different. I am not sure that I dare mention the Barnett formula. I apologise for being parochial, but I hope that the Minister will use this information to ensure that the legislation that is put in place is not too urban-centric. I hope that he is as concerned as I am to improve the prospects of young people in Berwick, in north Northumberland. The community’s economy depends on our young people being well educated and well trained.

6.23 pm

Lord Northbourne: My Lords, I shall be relatively brief. I want to raise one issue, which relates more to the White Paper than the Bill, but I believe it to be crucial to the success of the Bill in achieving its declared objectives. I understand that the declared objectives of the Bill are, first, to increase the employability of young people who have fallen through the net or who have, for one reason or another, missed out on the academic route, and, secondly, to increase equality.

In my view, there is one golden key, one talisman, and one general skill that can do more than any other to achieve the Government’s two objectives, whatever specific subject a pupil may choose to study. As far as I can see, that skill is not mentioned either in the White Paper or in the Bill. It is the ability to get on with other people and to communicate effectively. The communication skills of reading, writing and numeracy are mentioned in the White Paper, but there is no mention of the equally important skills of listening, understanding, speaking clearly and effectively, making a presentation, negotiating to a

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mutually satisfactory conclusion without anger, learning to work as part of a team and perhaps sometimes to lead that team. Those skills are sometimes referred to as the soft skills, but they are not soft skills; they are the key skills.

Many young people today who have lost out on the academic route have done so partly or wholly because of their inability to get on with their teachers or their peers. Sadly, many of them have done so because they did not get the chance to learn those skills in the family. The last hope that they may have to acquire those skills is through the further education system. If we genuinely seek equality, that group must be a prime target for help within the FE system.

It is not only the hard cases who would be helped to develop a successful and fulfilling career if their interpersonal and communication skills were improved. The Library has given me a mass of statistics, but I will not lengthen this debate by going into them in any detail. Of the 22 million people in employee jobs on a given date in 2006, 18 million were in jobs—including construction, wholesale, retail, hotels and restaurants, business activities, public administration, health and social services—that are impossible to do if you are not a reasonably good communicator.

In my experience, those interpersonal skills can be taught and can be learnt. Where they already exist, they can be improved by suitable practice, training and guidance, not so much by formal teaching but by activities, games and challenges, through confidence-building and the experience of working and learning together as a team. I agree with the Government’s policy that the choice and content of further education courses should be demand-led, but surely there must be some basic guidance and underlying rules. Indeed, the Bill reserves for the Government the powers to direct learning and skills councils, and I am sure the Government will also direct Ofsted about what they are looking for.

Can the Minister give an assurance that the Learning and Skills Council will be under an obligation to deliver key basic training in interpersonal and communication skills to all students under the guidance of well qualified teachers? I hope that he can give me that comfort; if so, I shall not have to delay noble Lords by bringing the matter back in Committee.

6.27 pm

Baroness Lockwood: My Lords, unlike the Front Benches opposite, and like the right reverend Prelate the Bishop of Durham, I welcome the Bill. It is a technical Bill, but it is also a facilitating Bill. It improves the 2000 Act in a way that makes it more possible for us to work towards the targets set by the Leitch report. They are very ambitious targets given where we are at present but, as most people will accept, they are the minimum required if we are to match our international competitors.

As the Minister indicated, there is much in the Bill to be welcomed. Unlike the noble Baroness, Lady Morris of Bolton, I particularly welcome the intention for the powers to be devolved down. I do

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not think that it is a centralising Bill; it is a devolving Bill. The Government are to set the overall national objectives and then powers will be devolved down to the national and regional LSCs to develop strategies.

I hope that the Secretary of State will not be too prescriptive in how the objectives are to be realised. Equally, I hope that the national LSC will give much greater scope to the regional LSCs than does the present bureaucratic body and that after setting annual budgets the national LSC will allow flexibility and financial virement to the regions to enable them to develop appropriate strategies. I also hope that care will be taken in making appointments to these bodies. Those appointed should be familiar with the problems of the region and with the education and discrimination problems mentioned by the noble Lord, Lord Low.

I approach the Bill from a regional perspective, particularly from a Yorkshire and Humber viewpoint. In Part 1, Clause 4 gives the Secretary of State new flexibility in allowing bodies other than the LSC to formulate strategies. London, in particular, has been mentioned because of its acute problems. Like the noble Baroness, Lady Sharp, and my noble friend Lady Blackstone, I believe that there are other areas that would qualify under this clause. What will be the process for promoting this flexibility to those other areas? I have in mind, of course, the Yorkshire and Humber region, which has its own very real problems. There is under-performance in that region on all the key indicators.

In its regional strategy, Yorkshire Forward is addressing this historical, cultural and industrial inheritance. Progress is being made to close the gap between the region and national averages, but we are not yet there—let alone meeting anything like Leitch targets. There are historical, cultural and industrial problems still to be overcome, especially in those parts of the region where industries have been run down and we are trying to re-industrialise.

In some of these areas there are entrenched anti-learning and anti-education views, especially about continuous learning. After all, the previous experience has been that you learnt either by sitting by Nelly or by watching Jimmy. Real educational and training progressions have not been experienced. Often, this covers the generations of a family and it is not just confined to elderly people. Nor is it confined to families alone. There is also a lack of demand for training from some employers, thus denying the Leitch employer-led approach. Employers operating in low added-value markets have no intention or incentive to finance training or utilise a more highly skilled workforce. This needs to be addressed in the regional strategy.

On the other hand, there is a tremendous resource in the region. The eight universities produce excellent, employable graduates—40 per cent of them come from the sciences and engineering. Most of the graduates, however, seek careers outside the region. The universities and employers are aware of this and are working with Yorkshire Forward and the LSC to

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try to address it. An increasing number of regional students, many from ethnic communities, could help to stem the leakage.

Another encouraging sign is the success of school non-achievers—children who have left school without qualifications but are gaining level 2 qualifications during the 16 to 19 period. This is catching up to a low level instead of building on the achievements of schools. The new qualification to be phased in from next year could be a great help in this respect.

I am sorry if all this sounds negative. It is not meant to be. It is a question of facing up to the realities of a region where traditional industries have collapsed and where we face new problems. Of course, there have been some great successes in the region: the development of new industries; the building of critical masses and industrial clusters; and so on. For example, there are areas in North Yorkshire that exceed national averages. In South Yorkshire—one of the areas that has suffered greatly from industrial collapse—the National Metals Technology Centre, based at the Advanced Manufacturing Park in Rotherham, is succeeding well. These are all factors that are being built into a broad regional strategy, embedding the supply and the demand of education and training, together with innovation, into a high priority.

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