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I thank the noble Lord, Lord Hunt, for his introduction and for giving me the opportunity to walk us through some of the key issues. He is right that this is an important debate, and how we frame it is important. I speak with some passion, having worked on the previous education Bill that came through this House and that focused so much on raising the participation age for young people. I remember the passion that we put into that. Many strands flow from that Bill into this, and we see the importance of getting these bodies functioning properly and well set up.
There are a number of reasons why it is appropriate for the YPLA and the Skills Funding Agency to be established as separate bodies. They will serve very different constituencies. The YPLA will support local authorities to ensure that the interests of all young people aged 16 to 19, of those aged up to 25 with learning difficulties, and of young people subject to youth detention on whom we have just focused, are met. The Skills Funding Agency will meet the demands of employers and adult learners and is exactly about the flexibility to which the noble Baroness, Lady Perry, pointed. These groups are different and they have different needs. Each requires a distinct focus for really strong delivery.
The Skills Funding Agency will oversee the demand-led funding system that we know employers are looking for. It will support employers and adult learners through a number of customer-focused services, including Train to Gain, the National Apprenticeship Service, the Adult Advancement and Careers Service and the learners' skills services. The YPLA, on the other hand, will have a supporting and enabling role, assisting local authorities and their partners to meet the needs and aspirations of our young people. It will fund local authorities on the basis of their commissioning plans. Detailed work needs to go into developing those commissioning plans because we need to ensure that they are right.
Such diverse models and client groups suggest to me and to many with whom we have consulted that two separate agencies are needed. As one would expect, the noble Lord, Lord Hunt, brought some very interesting quotes to our debate. The Association of Colleges has been on record as welcoming the proposals for the structure of the 14 to 19 education system. The Association of School and College Leaders also welcomes the proposals. The CBI said:
"Business welcomes the intention to create a more 'demand-led' approach to adult skills funding through the ... Skills Funding Agency".
As separately run organisations, the YPLA and the Skills Funding Agency will be governed to respond to their customers. The YPLA, as an NDPB, will have a strong sector-led representation on the board, as the noble Baroness, Lady Sharp, was concerned to see. The SFA, as an agency of BIS, will have that close relationship to government which is necessary to deliver a strong, demand-led post-19 system.
Having separate organisations also enables clear and unambiguous lines of accountability to each Secretary of State, as well as to Parliament, which this House is
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The range of functions required at national and regional level is such that these functions must be undertaken at arm's length from the department and that only a stand-alone YPLA would deliver the intensity of focus on young people and the local authorities that serve them which is required to make a success of the raised participation age, about which I have talked already.
The noble Lord, Lord Hunt, asked for clarification on intervention. Earlier, I said that the YPLA will have powers to intervene if a local authority is failing in its commissioning duty in respect of young offenders. It will have the same power to intervene in an authority if it is failing in its duty for all young people. It is right to have that backstop power in the interests of young people, but it is very much for extreme, exceptional cases. These powers stand out in the Bill, but they have to be in legislation of this nature because we are talking about the use of public money and ensuring that the best results are achieved.
As regards this being a complicated system, I do not accept that two bodies will make life more complicated for colleges and other providers. As noble Lords are aware, colleges and other providers manage multiple funding streams and blend their work across government with the vast sums that are spent by the private sector on training. Having two main funding streams, one for young people and one for adults, is not dissimilar to present arrangements. I would argue that this is a step very much in the right direction. As the noble Lord, Lord Hunt, requested, we said that we will write to noble Lords about transitional costs in detail before Report, and I reiterate that commitment.
The noble Lord was very concerned about references to increasing bureaucracy. I, too, would be very concerned at any suggestion that these plans are about increasing democracy. We plan very clearly to reduce bureaucracy, which is why we have been in discussion with the Association of Colleges, the ASCL, the LGA and others about how we can do so in practical terms. We are committed to doing that.
As regards Amendments 146B, 146C, 146D and 146E, and the concern that the YPLA's board is representative, I will consider further the proposals of the noble Baronesses, Lady Sharp and Lady Garden, further and will think about coming back on Report with proposals. The noble Baroness, Lady Sharp, asked another detailed question on EMA about which I shall have to write to her and I undertake to do that
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7.45 pm
Amendments 145 and 169A seek to limit the number of staff employed by the Young People's Learning Agency to 500 and by the Skills Funding Agency to 1,800. Our current plans are that the two bodies will start off their lives with staffing at about the levels highlighted in the amendments. We are confident that staffing will not rise significantly beyond these levels. We do not see the need to set these ceilings in primary legislation for a number of reasons. First, as with every organisation in the public sector, both bodies will be expected to contribute towards year-on-year efficiency targets. Just because they are new bodies does not exempt them from that. Secondly, the principal brake on staff numbers will come through the annual remit and budget letter, which will set out the objectives and budgets of each organisation. Thirdly, proper structures are in place to ensure that both bodies can be scrutinised effectively and held to account for the use of the resources they are given. They will be required to report annually to Parliament. The chief executive and, in the case of the YPLA, the chair, will be or can be summoned by the Public Accounts Committee or their departmental select committees and their work will be subject to scrutiny by the National Audit Office.
Amendment 146A would require the Secretary of State to carry out a regulatory impact assessment to review the costs of abolishing the Learning and Skills Council, and the setting up of the Young People's Learning Agency and the office of the chief executive of skills funding. The impact assessment for this Bill, which, as the noble Lord, Lord Hunt, highlighted, has been updated prior to introduction to this House, confirms our commitment that the transfer to the new arrangements will be cost-neutral, which I reiterate now. In designing the new structures we are working to an indicative administrative budget, which is set at the same level as that within which the Learning and Skills Council currently operates.
As noble Lords would expect, there will be one-off costs associated with the transition to new arrangements; for example, to close down premises which are no longer needed and to pay for possible staff relocation and retraining costs. They are the normal transitional costs that one would expect. Initial estimates are that these costs will total around £38 million, but we expect the reduction of the estate to rapidly generate savings in subsequent years, with annual savings of up to £17 million. The potential for additional savings from operating shared services in relation to the IT systems will be particularly important. I want to be absolutely clear that this is being driven by the outcomes we are looking for in adult skills and in raising the participation age for young people in education in this country. I hear the concerns raised by noble Lords and I have offered to consider further the amendments put forward
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Viscount Eccles: As a Back-Bench Member, I have been wondering, if the Motion that Clause 58 should stand part was moved and was voted down, what the Government would do then. It has been tabled in the name of the Opposition Bench and that of the Liberal Democrats. That prompts me to ask, after the speedy reply given by the noble Baroness, why it is right to have an executive agency on the one hand and a full-blooded non-departmental public body on the other, and then to say that they will share things. The constitutional position of an executive agency is different from that of a non-departmental public body and I do not think that they will find it easy to share anything. For a start, the executive agency basically has to do whatever the Secretary of State tells it to do; that is its position. A non-departmental public body, if one goes back to 1998, is said by the present Administration to be at arm's length. I think the noble Baroness used that phrase, although of course the arm can be twisted either to a small degree or to a large one. Nevertheless, the fiction-or perhaps it is the reality-is that non-departmental public bodies are independent.
As the noble Baroness, Lady Sharp, said, we really do not know anything about how the YPLA will use its independence. It is quite indicative, on reading the Bill, that the schedule covering the YPLA extends over six pages while that for the SFA goes over three. That is the difference in a nutshell between an executive agency and a non-departmental public body. The draftsmen have to take a great deal more care with a non-departmental public body than they do with an executive agency. In this case, the amendments tabled by my own Front Bench suggest that the SFA should be the primary body, because if it is going to employ 1,800 people while the YPLA employs only 500, it can be seen that there might be a good case for the SFA. So I am in a state of confusion because I do not understand, for all the passionate explanation given by the noble Baroness, what is really intended, and I feel quite strongly that this matter needs a great deal more careful consideration than it has had to date.
Baroness Sharp of Guildford: I had not expected the Minister to respond as positively to all the amendments in this group and we are very grateful to her. Obviously we shall await the government amendments before we decide where we stand on this issue. She has promised them for the Report stage and I hope that we shall have a chance to look at them before Report.
I do not have the impact assessment with me, but I have one question for the Minister. Some 1,000 members of the LSC are going to work with local authorities. Are local authorities going to be compensated for the cost of employing these people? It is clear that over the past 10 years local authorities have run down their education authorities so that they are now often rather slimline bodies because they are not really involved in the functions of strategic planning and running schools, let alone doing anything in the further education sector, which they came out of some 20 years ago. Local authorities need the resources to employ people
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Lord Elton: Could the noble Baroness direct me to something which I ought to be able to put my finger on at once; that is, to the part of the Bill describing who will discharge the functions of the YPLA as regards schools, universities and so on in Wales?
Baroness Morgan of Drefelin: I shall pick up the question from the noble Baroness, Lady Sharp. The current high-level figures show that the Learning and Skills Council has a budget of roughly £12 billion, of which around £5 billion would be apportioned to the SFA and £7 billion to local authorities through the YPLA. What we are looking at in terms of the running costs of the LSC is £205.7 million, which is the ceiling beyond which we do not expect the SFA or the YPLA to go in terms of administration. On the allocation of staff, as the noble Baroness said, we are looking at around 950 members of staff from the LSC, which currently has around 3,300 staff, to go to local authorities. We expect that overall the devolution of £7 billion to local authorities will not by any means put them in a difficult financial position when they receive those staff. I am quite sure about that, but if I can go into more detail for the Committee, I will do so.
The noble Lord, Lord Elton, asked about Wales. The YPLA is an England-only body, as is the Learning and Skills Council. As I think I have said before, a lot of the Wales powers are mirror powers. However, because the YPLA is an England-only body, I am not able to point to a place in the Bill that sets out the functions he is looking for.
Lord Elton: Does that mean that this reorganisation applies to England only and does not touch Wales?
Baroness Morgan of Drefelin: As I said, the YPLA and the SFA will be England bodies. I am sorry: the YPLA will be an England body.
Lord Elton: Is it the case for the Skills Funding Agency as well?
Baroness Morgan of Drefelin: Yes, my Lords. I see that there are lots of nods.
Lord Elton: I hope that I have it correct in saying that everything we are discussing applies only to England, so that everything in Wales remains exactly as it is now. Do I see a nod of profound relief or otherwise?
Baroness Morgan of Drefelin: I am sorry, but I cannot hear the noble Lord.
8 pm
Lord Hunt of Wirral: First, I should like to say how much I enjoyed the speech of the noble Baroness, Lady Sharp of Guildford. As always, she has given me a lot to think about. I realise that she was delving into
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The sum of all this is that I hope the Minister will take time to reflect on the debate because she gave a number of assurances. The noble Baroness, Lady Sharp of Guildford, obviously feels that the Government have given a commitment to consider bringing forward amendments. I did not hear the Minister say the word "amendments", but, if that is the case, I would greatly welcome it because we need clarification. The Minister got so bound up in the whole, if I may say so, quixotic verbosity and chivalrousness of the speech she had been given that she said it was in no way her intention to increase "democracy"; I think she meant "bureaucracy".
Baroness Morgan of Drefelin: I thank the noble Lord wholeheartedly for giving me the opportunity to clarify that for the record. He is very generous in allowing me to correct it.
Lord Hunt of Wirral: Everything else the Minister said would gladden the heart of Sir Humphrey because she defended the indefensible brilliantly. There is no doubt that when you create more bodies you create more bureaucracy; that is a sad fact of life.
We would like to reflect on this important debate, which has been an excellent opportunity to air concerns. I hope the Minister will take time to consider all the points she has not had an opportunity of responding to because there were a whole series of questions which she has not had time to deal with today. Undoubtedly we will return to the subject on Report. In the mean time, I beg leave to withdraw.
Schedule 3 : The Young People's Learning Agency for England
Amendments 146B to 146E not moved.
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Clause 59 : Provision of financial resources
Amendments 147 to 149 not moved.
House resumed. Committee to begin again not before 9.03 pm.
Pharmacies
Question for Short Debate
8.03 pm
To ask Her Majesty's Government what steps they are taking to ensure that reform of the pharmacy sector will contribute to better health, increased patient choice and an improved relationship between community pharmacists and general medical practitioners.
Lord Clement-Jones: My Lords, I first need to declare an interest and the reason why I have initiated today's short debate, and, despite appearances, not as a Front Bencher, I may add. Last year I took up the role of chairman of the Council of the School of Pharmacy, University of London. The school achieved outstanding results in the research assessment exercise published last December and is top of the so-called power rankings for research among the pharmacy schools and faculties. We are also making a global contribution to pharmacy education through the Global Pharmacy Education Taskforce and having a major input into the future of pharmacy education and regulation here in the UK.
Today, however, I want to highlight the unexploited opportunities for improved care with the further development of pharmacy services in the community. Let us have a quick look at the figures. There are 12,000 pharmacies in the United Kingdom and 32,000 registered pharmacists. They dispense some 1 billion items annually across the UK. The nature of pharmacy is changing rapidly. It has traditionally focused on dispensing medicines. However, if we invest wisely in community pharmacy now and build intelligently on the heritage of NHS community pharmacy and GP practice, it can help achieve better public health and more cost effective delivery of clinical care.
The recent White Paper, Pharmacy in England: Building on Strengths and Delivering the Future, set out some of this landscape. The regulatory context is changing significantly, too, with the creation of the General Pharmacy Council, which comes into being next year. Growing demands from people recovering from acute interventions after short stays in hospital and others living with long-term health problems are putting new strains on GPs and their practice colleagues. Extended care by community pharmacists can help patients of all ages to obtain and use the medicines as productively as possible and can free GPs to focus more of their time on patients with the highest levels of need and enable more members of the public, particularly older people, to obtain good quality care and advice closer to their homes and workplaces and help them stay healthier for longer.
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Examples of extended pharmacy care-some foreseen in the White Paper and included in the current range of enhanced services-include diagnostic and preventive screening; the identification and reduction of vascular disease related risks; other preventive services such as smoking cessation support and the provision of emergency contraception; common ailments treatment and obesity management; the management of long-term chronic conditions; improved repeat medicine dispensing services and the targeted provision of home and other medicines' use reviews; and improving health outcomes in areas such as diabetes through integrated care delivery, as experienced in Hackney and in Tower Hamlets.
Every political party recognises that the future public spending climate will be difficult and that there needs to be a rebalancing towards primary care. But we have to make sure that it really happens in practice. Pharmacists will, with the right support, be increasingly capable of helping us all to treat risk rather than disease, but there are real challenges to be overcome if lasting progress is to be achieved. These include pressures on PCTs which are leading some to fail to invest in community pharmacy developments. It seems that current local and national arrangements for funding community pharmacy in England and the other nations of the UK are not adequate to deliver necessary cost-effective developments.
The pharmaceutical needs assessments are a recommended commissioning tool for primary care trusts, but lack of pharmacy involvement in their execution, as the RPSGB says, has hindered their effectiveness and the provision of services. Then we have the issue of enhanced services: the evidence from pharmacists is that they form less than 3 per cent of income but 7 per cent of pharmacists' activity on average. Should there not be a set of non-discretionary services-call them advanced or nationally arranged, if you like-provided in each area?
We need to standardise accreditation by PCTs: each PCT has a different accreditation system. In larger companies pharmacists move from one store to another, but each PCT has a different system to accredit them. We also need to standardise service specification and commissioning.
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