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We know now that Clause 3 defines the future of the 47 local LSCs not as change but as abolition. So far, nothing leads us to Clause 2 and regional councils.

What did we know about the existing nine non-statutory regional boards? First, that the LSC has expected them to become statutory, and now the Minister has said that they will. That makes for some clarity in amplification of new Section 18A, introduced by Clause 2, which, at present, leaves it to the Secretary of State to specify the number and geography of the proposed areas of England. However, as the noble Baroness, Lady Sharp, asked, what has happened to the 148 partnerships with local authorities? Presumably they will continue. The trouble is that new Section 18A is no more than an enabling measure, prompting questions other than, “Will there be nine?”. For example, under new Section 18A(3)(j), the Secretary of State can make provision for,

What will the representative do? Will he deliver the Secretary of State’s directions on the strategy to be followed by the LSC, as envisaged in new Section 24B?

It is almost as though the Government were using Clause 2 to think out loud; yet, only six years ago, all the usual and expected provisions for the 47 were set out in the 2000 Act, with the LSC retaining responsibility for much of the detail. Why is there a change in the arrangements for the nine? There is no good reason why the Government have not decided what to do, and not put it clearly in the Bill in the usual way. As the noble Lord, Lord Low of Dalston, said, the membership of regional councils is of great interest to Parliament.

It is unhelpful to present us with this widely drawn and unusual clause. It would leave too much discretion to the Secretary of State and too much doubt in the minds of the LSC and the further education sector. Left as it is, we would speculate, as would the LSC, because, despite the referendum in the north-east, regions remain the darlings of the Government. Who is to say which body will be reformed out of existence next in the pursuit of nine city-based centres of power? Will the Minister look again at Clause 2? Draft regulations are a poor substitute for provisions in the Bill. As it is, it is a pity that the confirmation of the nine was left until today. However, there is no need to stop there.

7.09 pm

Lord Moser: My Lords, I join noble Lords who have spoken in opposition to Clause 19, on foundation degrees. Others, such as the noble Baronesses, Lady Blackstone and Lady Warwick, have explained very well why this is a seriously wrong direction to take, so I shall not take up much time, but I hope the Government will think again.

I want to concentrate on the serious problems regarding the basic skills of literacy and numeracy, for which further education colleges, and therefore the council, have major responsibility. One cannot remind

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oneself often enough that those are truly the basic skills on which everything else rests. I must declare a personal interest: for a number of years, ending in 2002, I was chairman of the Basic Skills Agency, which, under the innovative leadership of Alan Wells, made many telling contributions to improvements in basic skills.

I realise that this has been a serious government priority from the beginning and that on the whole there has been good progress, especially in the primary sector. These educational issues figure frequently in your Lordships’ discussions, so I will not take up time on them, because more relevant to this debate is the area of adult basic skills. I must declare another interest as former chairman of the committee, to which the Minister referred, set up by the Government some years ago to improve the basic skills of adults. Our report, A Fresh Start, appeared in 1999, again with the Basic Skills Agency as a critical partner.

Most people knew that there was a problem, but most people, including the Government, were staggered by the horrifying situation whereby millions of adults were suffering from poor literacy and very poor numeracy. It is a complex picture, and I can refer only briefly to the findings. It is worth keeping in mind that our key criterion for what was called functional illiteracy and innumeracy was a level below what is expected of an average 11 year-old. On that basis, 7 million adults in England—one in five—were so affected, with more having poor numeracy. Clearly the country faced a massive problem.

With millions of adults handicapped by their inability to read and write, and to deal with numbers, something had to be done. Our report made many recommendations, and it is good to think that the Government accepted most of them. It was realised and made very public that those who liked league tables had to realise that this was a league table in which England came second from the bottom in Europe. Only Poland fared worse. The report had an enormous public impact and led the Government, not least through the priority and personal commitment of the Prime Minister and the then Secretary of State, David Blunkett, to work fairly quickly with a number of our recommendations. In fact, the Prime Minister called it “a crusade”.

Among our most important recommendations was the role of the FE sector. I say all this, not just to remind us of those stark findings of some years ago, but because the evidence is clear that the situation today still poses a major challenge for the Government, the council and, above all, FE colleges. I realise that reducing the number of adults so affected has continued to be a government concern and that there has been serious progress, but I must note that the statement in recent years that our earlier targets have been not only reached but surpassed is statistically misleading. I refer particularly to the 750,000 learners who were to reach basic skills requirements by 2004. It was announced that that had been achieved. That is seriously misleading. In the Skills for Life strategy, the target audience has been enormously widened to include everyone who does

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not possess a GCSE grade A* to C in English or maths, and so many, perhaps as many as half, of those who have reached the basic skills target are already way up the educational ladder and not part of the seriously disadvantaged group dealt with in our report, so that claim was misleading.

Against that background, I turn to the current facts. David Sherlock, the chief inspector and chief executive of the Adult Learning Inspectorate, who has already been quoted, wrote recently that the Skills for Life strategy is intended to tackle the problem, but:

He also says—and this is the key point—that the programme,

Present figures, mentioned by the Minister, suggest that in 2006 some 5 million working-age people still lack functional literary skills, and nearly 7 million—which I believe to be a serious underestimate—lack functional numeracy skills. The Leitch report refers to those points and makes practical recommendations, some of which follow those in our report of years ago.

I realise that this is not the occasion for reviewing the many policy areas which need now to contribute to solving the problem, ranging from issues grounded in social exclusion to all the years in school and, not least, in the work place. But they also mean a serious commitment from the further education sector as the key educational provider. Can the Minister reassure us that the “crusade”—the Prime Minister’s term—has not lost its impetus, as I suspect it has? Is there still the public commitment that so encouraged us after our report a few years ago? Another reason I feel discouraged is that Alan Wells, a long-term leader in this field, was allowed to leave his post as director of the agency, and the Government have just announced their regrettable decision to stop funding the Basic Skills Agency. This is a backwards step, given the innovations and independent thinking of which it has been, and could remain, capable.

I hope that, whatever the formal changes resulting from the Bill, basic skills will be given their necessary priority as the base of the pyramid—priority by the Government; by the council, with adequate resources; and, above all, by colleges. I would like to be reassured that the crusade remains in place and that this role of FE colleges will not be squeezed out by other new roles.

7.19 pm

Baroness Morris of Yardley: My Lords, I agree with the implications of others that this is not the most inspiring legislation that the House has had to consider. It is a necessary one, however. There is a time to tidy up previous legislation; with one exception, the Bill certainly does that.

I recognise the importance that the Government have given to the skills agenda and the great progress being made. Given the extent of the work, it is perhaps unsurprising that tidying-up legislation is

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needed. As noble Lords have said, the skills agenda is attacking failed education and school systems of the past and meeting the new technological and employment needs of the present. It is trying to build new institutions to deliver that. I want to start on a positive note by congratulating the Minister and a number of government departments for placing skills, skilling people and giving opportunity at the centre of the political and economic agenda for the first time. Long may it be there.

I suspect that a lot of us saw most of the Bill coming about three years ago. With the greatest respect to my noble friend Lady Blackstone, I must say that, although the LSC as set up was really good, the structural difficulties with having 47 councils and a fairly strong national council could be seen in those first 18 months. I am glad that we waited five years; it has given us time to reflect and ensure that we get it right this time. That is a tidying-up, and my only comment would be that I am still concerned about what is almost over-activity at regional level. We have seen lot of changes in what happens at regional level over the past five to 10 years. We now have powerful RDAs and will have powerful LSCs. We have, in many respects, more powerful government offices, especially with their directors of learning—I am not sure that that is the exact title. I say to the Minister that we need clarity at regional level, rather than too many bodies stepping on each other’s toes. I ask for assurances that the relationship of the new regional LSCs with the RDAs and government offices will be clearly marked out.

I suspect, however, that Clause 19 will be the only really contentious part of the Bill, making it something other than a fairly boring piece of legislation. I, too, declare an interest, both as pro-vice chancellor of the University of Sunderland and a member of the governing council of Goldsmiths College in the University of London. I cannot think of too many new arguments to add to those that have already been made. Given that there was so little debate on the proposal before it came to your Lordships’ House, I hope that numbers might be counted up and a message sent back to the department that an awful lot of noble Lords felt that this was a great mistake. I therefore apologise if I am about to repeat some of the arguments, but they stand repeating to add weight to the numbers and the strength of feeling in the sector and the House about how wrong the Bill would be.

Over the past 18 months at the University of Sunderland, I have had the pleasure of seeing the strength of the partnership between colleges and our university. One of my roles there is to build links with the community, colleges and schools. It works very well indeed, and we should celebrate the fact that universities have taken on the Government’s agenda of widening participation and building links with the wider learning and geographical communities. That is a mammoth change from the ivory towers of 15 or 20 years ago. The Government have asked them to do that, and building those relationships with the colleges has taken a lot of patient work, trust-building, resources, time and energy. It has meant that

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vice-chancellors and those in universities and colleges have had to prioritise that relationship. It has been done, and it has worked. Nothing the Minister has said calls that into doubt.

I am convinced that that relationship would be jeopardised if colleges were given powers to make their own degrees. First, the incentive will go. Secondly, whether we like it or not, further and higher education would be moved into marketplace economics. That generosity of spirit, where people do something just because it is right, tends to get squeezed out in the marketplace. People will look carefully at where their money and time will be spent and conclude that this is risk investment for their own institutions.

At every graduation ceremony at Sunderland, we have about 100 students walk across the platform to receive their foundation degrees. Because they have a degree from the University of Sunderland and walk across our platform at our graduation ceremony, it is so much easier for them to come the following year and—if you like—finish off their degree and get a BA. We know that the trick to widening participation is giving people confidence to enter new institutions and types of institutions. That is why the Government spend so much money getting universities to work with schools: people get nervous if they have never done it before.

First, the Government have completely underestimated the power of the relationship between universities and colleges in making the move from foundation degree to college seamless. Secondly, as my noble friend Lady Blackstone said, foundation degrees are a success but are not really embedded in the educational landscape. To be honest, three years ago we were worrying about the numbers. People have had to work hard at making foundation degrees a success. Some things are wrong—people do not get a salary increase when they return to work; some employers do not value or pay for it—but none of them will be solved by giving degree-making powers to colleges of further education.

Do not rock the boat. Why change and give mixed messages to employers? We have just about got them to the point where we can say, “Hang on, we can breathe a bit easier now”. They are not likely to go away, but they need bolstering, looking after, caring for and nurturing. I do not see why or how changing the institution that validates them will help at all. I worry that employers and students will make a quick judgment that the degrees are validated no longer by a university but by a college and are not as good as they were or that it is an admission that they are not proper degrees.

Whatever the Minister says about that not being the intention, we are talking about non-academics who do not necessarily understand, or want to understand, the differences between universities and colleges. In our education system, universities validate degrees. That is simple to understand, and I do not know why we are muddying the waters. So I come to a question: what is it for? What problem is it solving? Where is the evidence that anything needs to be done? It will not help the student or the employer, and it

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certainly will not help the universities. So I have come to the conclusion that it helps colleges. If this is some sort of trade-off or offer to help colleges increase their status, I suggest to the Minister that we should not be doing that. We should tackle this from the skills agenda. Will it help improve skills? Will it help the status of foundation colleges? Will it mean more people go on foundation degree courses? Will it mean more progression to university? The answer is “No”.

Finally, there is no way at all that this can be contained by only a few colleges seeking permission for degree-making powers. It will become a badge of status. In his opening comments, the Minister said—the only thing he said on the issue—that not many would want it and it would be for high-performing colleges. Does any noble Lord know of a principal of a college of further education in this country who is not now incentivised to pursue it? Not to do so is to admit that theirs is not a high-performing college. Nobody will settle for less. It was the same with specialist schools and CoVEs and will be the same with double specialisms. Once you introduce the power as an incentive and a badge of good performance, you incentivise every institution in that sector to pursue it. That is the beauty of specialist schools. It is the beauty of CoVEs. They are incentivisers to high performance. The Minister has dropped in another incentiviser. To become a degree-awarding college will be an incentive that every principal worth his or her salt will pursue. It is a key decision. Once you open the door, you cannot close it to any college that reaches the standard. It cannot be number-limited; it has to be quality limited. There is no notion of how many may achieve that standard.

We have muddied the relationship between universities and colleges. I have always thought that the big problem for colleges is the difficulty in clarifying their relationship with schools because of our muddle over 14 to 19 year-olds. The one relationship that was clear for colleges was the relationship with universities. The danger now is that we shall make that interface between universities and colleges as confusing and overcrowded as that which existed between colleges and schools.

I differ from my noble friend Lady Warwick in only one respect. I do not think that at this stage we should offer conditions should the clause go through. If the situation is that serious, ill thought-out and potentially damaging, we should ask the Government to reconsider including it in the legislation rather than to mitigate it; otherwise, in five years’ time, this House will be considering again how legislation can sort out the mess that Clause 19 could bring.

7.32 pm

Baroness Murphy: My Lords, there is a wonderful book called Bluff your Way in Public Speaking, which has the advice, “Tell’em once, tell’em twice, and when they have heard it and relaxed, tell’em again”. So I shall repeat some of the comments made by noble Lords. I must declare an interest in the Bill as chair of council at St George’s University of London, where we are proud of the progress that we have made in

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widening access to medicine and the biosciences and in forging links to other HE institutions and local FE colleges.

Like others, I am puzzled by the timing of the Bill. No doubt, the Minister and his officials knew what was going to be in the report by the noble Lord, Lord Leitch, but most of us have had exactly seven days to digest its contents and no time in which to discuss it with colleagues and local partner organisations before the debate today. The Minister has a reputation for consultation and careful listening. We would have liked the time to do the same. Most of the Bill seems to be about the regional reorganisation of the Learning and Skills Council, even though, I note, Leitch cautions against time-consuming restructuring. Let no one mistake this: it will be an 18-month diversion from the job in hand and, as always, we risk losing some of the good work that is in train.

I am particularly concerned about the possible loss of progress for young people with a disability. The LSC launched recently its first national strategy for learners with a learning and/or physical disability in the FE system. The Disability Rights Commission is concerned that, with the radical structural changes proposed in the Bill, there is a real risk that the strategy will run into the sand. The Government have outlined an ambitious vision for improving the chances of disabled people. We know that, if a young person with a disability loses six months of education or training between 16 and 18, that is the single most powerful predictor of unemployment at age 21. The FE system has a vital role to play in achieving the Government’s vision for young people with a disability. I hope that the Minister will reassure us that a rigorous disability equality impact assessment will be published on the Bill.

Nevertheless, I understand the drivers to regionalisation, but larger geographical organisations often lose flexibility and local responsiveness. Are the Government sure that we shall gain more than we lose? If the Minister can say that he is sure, why are the changes in London proposed only on a temporary interim basis? Doesn’t London need more certainty and permanence about the arrangements, if it is to take the full benefits of regionalisation?

Like others here today with knowledge of the higher education sector, I am absolutely mystified by the notion of FE colleges being granted the power to award foundation degrees. We have several tiers of types of university already. Do we really want another layer of quasi-academic institutions producing qualifications called degrees without having to forge links to higher education? I grant that people say that the process is slow and expensive, so let us find ways of speeding it up. But it is often a matter of developing trusting relationships between organisations. Speeding up trust is rather a difficult matter. The finances are a matter for discussion between the Higher Education Funding Council and government.

There are other ways of solving the problem. The whole point of foundation degrees was that they were meant to lead on to opportunities for full honours

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degrees, but I fear that they will now become stand-alone diplomas without offering the real possibility of progressing up the learning ladder. I know that they are stand-alone qualifications at present for some of the reasons that the noble Baroness, Lady Morris, outlined. But who are we kidding? The students? The employers? If FE colleges can go it alone, they will. It is darned hard work creating close links between further education and higher education. This proposal jeopardises much good work that has been done.

Perhaps I may give two or three examples known to me locally that crucially involve higher education. First, from my own institution, St George’s, we have a health sciences foundation degree essentially to train paramedics from the ambulance services. The degree is delivered by Kingston University and St George’s in conjunction with local FE colleges and NHS ambulance trusts in south-west London. It is an example of how HEIs, even traditional elitist ones like medical schools, can get involved in luring people on to a career ladder where the sky is the limit.

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