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Having a proper committee structure in place is important, but I stress that since the capital programme is going to be shared between the two organisations, and sixth-form colleges are going to be separate and have their own programme, there needs to be a committee structure to link the appropriate parts of the system.
Baroness Howe of Idlicote: My Lords, I am rather attracted by this idea, not least because there is nothing in the Bill that refers to capital projects. As the school population expands and takes in those up to the age of 25 in certain respects, there will clearly be a need for adaptations, if not totally new buildings. Will the YPLA have a young person or a children's voice helping it to decide what to do and what to spend money on? I am not certain what the group in particular areas will comprise in terms of locality, the localness of people, the expertise and the people who will benefit, or not benefit, from what is proposed. I am rather attracted by this suggestion. I can see that there are advantages in having something like the YPLA but, having listened intently to what was said in the previous debate, I find it very difficult to think that there will be any saving of money in what is proposed and that there will be any advantages in it.
Lord Hunt of Wirral: My Lords, I rise strongly to support my noble friend Lady Perry of Southwark and to say that I found myself very much in agreement with the noble Baronesses, Lady Sharp of Guildford and Lady Howe of Idlicote. I think that they have put their finger on something that does not quite work and that my noble friend has proposed a modest amendment that seems to make a great deal of sense. I hope that the Minister will feel able to accept it.
The amendment extends the remit of the YPLA so that it has,
- "to oversee financial provisions for capital building projects for further education and sixth form colleges".
My noble friend has enabled us to raise the concern that we have seen time and time again throughout these debates about where are the lines of responsibility.
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The amendment moved by my noble friend Lady Perry would simplify this structure just by ensuring instead that capital funding is overseen by the YPLA. I read the worries of the Association of Colleges about the very division of funding and responsibility, and I hope the Minister will respond to its idea of a college capital committee that spans both types of colleges, the SFA and the YPLA. All this demonstrates the confusion created by having two agencies divided by age, where the line between the two remains blurred at some points. My noble friend's amendment would help to solve this problem by putting all responsibility under the YPLA. We all look forward to the Minister's response, and I very much hope that he will accept this amendment.
The Parliamentary Under-Secretary of State Department for Business Inovation and Skills (Lord Young of Norwood Green): My Lords, Amendment 149A would require the Young People's Learning Agency to put into place a committee structure to oversee capital allocations for further education and sixth-form colleges. I understand the concern, which follows on from the well documented problems of the Learning and Skills Council earlier this year. The LSC had a committee that was a single body, but it still did not seem to be the solution to the problem because the problem was more deep-seated than that.
In his well considered and independent review of the further education capital programme, Sir Andrew Foster found that,
As the noble Baroness, Lady Sharp, reminded us, the intentions were good-although, as we know, the road to hell is paved with those-but the implementation was, to say the least, less than satisfactory.
Sir Andrew Foster went on to make a number of recommendations, including for the stronger management of the FE capital programme, better prioritisation, and the need to shift from a demand-led to a need-based approach to funding. He urged that consideration be given to future working arrangements. The recommendations of that report have been fully accepted by the Department for Business, Innovation and Skills and by the LSC.
As a number of people have pointed out-the noble Baroness, Lady Sharp, really got to the heart of this-the YPLA will have responsibility only for the 16 to 19 capital fund, which underwrites the costs of
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The Secretary of State will set out his expectations through his remit letter to the YPLA. We will ensure that, through that letter, the YPLA takes account of the lessons learnt from the FE capital funding programme in devising effective systems for managing the capital resources that it allocates. On that point, and to give a little more detail, simply imposing a committee structure is not enough, as we know from the lessons learnt from the LSC, unfortunately. We need to ensure that the YPLA, once it begins operating, has learnt from the problems with FE capital and has devised appropriate arrangements that minimise the risk to their capital resources. The remit letter will place the duty on the new chair and chief executive to do that. In conclusion, we believe that the remit letter is the best place for any details. It would not be right to describe essentially operational matters in the Bill, which anyway only deal with part of the problem.
On the basis of this assurance, I hope we will ensure that the lessons of what happened at the LSC are learnt and reflected in the remit letter. I want to give an assurance to the noble Baronesses, Lady Perry and Lady Sharp, and all those who have contributed in this debate that we are not in any way treating this matter lightly. We will ensure that the details of the remit letter are circulated in advance because we share the same concerns as noble Lords. The way in which the capital programme is allocated is fundamentally important. We have seen the repercussions that have taken place when it goes wrong. I am not in any way dismissing the concern. We do not believe that this amendment is the right vehicle for dealing with it, although we share the concern of the noble Baroness, Lady Perry, and others about the need to address this problem. With my reassurance about the remit letter and the opportunity to look at it, I ask the noble Baroness to withdraw the amendment.
Baroness Sharp of Guildford: As I understand it, there will be one capital programme for further education, which will be divided between the SFA and the YPLA. Since the SFA is not an NDPB, it will not receive a remit letter. How will this be dealt with as regards the SFA? If the programme is to be shared with sixth-form colleges, there will be yet a third player. Will whatever letter goes to each of the bodies ensure an effective co-ordination mechanism, to make sure that they are all singing from the same hymn sheet? When there are three authorities, the great danger is that something will fall between the stools and not be addressed.
Lord Young of Norwood Green: The short answer is yes. I said that the YPLA will need to have arrangements for working with the Skills Funding Agency. We will ensure that we cover both points made by the noble Baroness.
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Viscount Eccles: I hesitate, but I think that there is a more fundamental problem. All organisations need some focus. The YPLA focus is not on capital spending. As far as I can see, the Bill is completely silent on capital funding. My noble friend's amendment seeks to find out, as well as to suggest a way forward, how the YPLA will tackle project management. Capital funding and capital spending is project management, which requires a completely different skill to that required to make provision for the education of young people. How will the Government guarantee that, in the selection of the members of the board of the YPLA, they will include this project management skill?
I have been in project management for a great part of my career. As the chairman of a non-departmental public body, the Royal Botanic Gardens, Kew, I took responsibility for the rebuilding of the Palm House. All I can say to Ministers is that if I had relied on its board and staff, and had not taken special steps to ensure that the Palm House was rebuilt to the required standard, it would never have happened.
The Government are simply saying that all they will provide is a remit letter. For goodness' sake, we all get letters telling us what we should do. But have we got the capability to do it? This Government should think much more carefully about the skills that will be required-and, goodness me, the Bill is all about skills-to devise and control capital expenditure projects. Nothing here gives me comfort that the YPLA will be any good at the job.
Lord Lucas: The YPLA has a rather difficult remit anyway. It is supposed to drive up participation without being in any way directly involved in the provision of education, and it is supposed to be involved in equipping the workforce with the right skills without having any direct connection with employers. It is altogether an odd and strange animal. I note too that the term "demand-led" in this amendment is pejorative, but in the previous amendment it was approbative. It was hymned by the noble Baroness in her reply to the amendment of my noble friend Lord Hunt. Perhaps the Government are also confused about what is going on here.
Lord Young of Norwood Green: In answer to the noble Viscount, Lord Eccles, I think he is right that we have to ensure that project management skills are applied. I shall take that into consideration because it is a valid point. In response to the noble Lord, Lord Lucas, context is everything. As for "demand-led", we were dealing with a totally different scenario, which is why my noble friend extolled its virtues in that situation. There was probably nothing wrong with "demand-led" in this situation if it had been controlled and properly project-managed.
I do not want to repeat myself. We understand the importance of the issues and we understand where the noble Baroness is coming from. We have undertaken to write with an outline of the remit letter and will take into account the importance of the two agencies working together. I hope, with those repeated assurances, that the noble Baroness will feel able to withdraw her amendment.
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Baroness Perry of Southwark: I thank all who have contributed to what has proved to be an important issue in the structure of the YPLA. I am not entirely sure that anyone feels that they have had a complete answer to the concerns they have expressed. There is a yawning hole in the assumption that a remit letter to the chief executive and the council of the YPLA will somehow magically translate itself into the right kind of oversight of what presumably will be quite a large budget. Although the remit letter is a part of it, it must be taken delivery of by someone or some part of the organisation that will actually have to see it through, and my amendment was an attempt to secure that. Just a letter sent to the YPLA could produce exactly the same kind of situation we had with the LSC where there was a committee without expertise or any particular project management skills and which, as we all know, made a fair old mess of the job it was given to do. To say that one committee did not help does not mean that therefore you should never have a committee again, but perhaps that is a rather trivial objection.
Much more important is something that perhaps I did not make clear enough in my opening remarks to move the amendment. I refer to the point made so pointedly and accurately by the noble Baroness, Lady Sharp. The Skills Funding Agency and the Young People's Learning Agency will both have money for capital projects that will have to be spent in one place, so to speak: on the organisations and buildings that are to provide education. It is vital that there is one point between the two bodies which takes responsibility for that. It is sensible that it is the YPLA not only because it will get the remit letter-again as the noble Baroness, Lady Sharp, has said-but because the agency will be in close touch with the huge body of the further education and sixth-form colleges which the Skills Funding Agency quite clearly will not be.
I am not claiming that the wording of the amendment is perfect but something like it should be in the Bill, not tucked away in a schedule or in advice and guidance that comes out after the Bill is passed, if it comes to pass. There should be something there which says that, for the two responsibilities that the bodies have-for revenue funding, yes, but also for capital funding-there needs to be a point where responsibility is shared.
It would be nice if Ministers, just once, would say of something that has a great deal of agreement in the Committee, "Okay, we will take it away and think about it". It would help a great deal. It would make those of us who have worked away-and we are grateful for the meetings that we have had over the summer with the Minister-feel good if the Minister could do that.
Lord Young of Norwood Green: We have not dismissed the importance of what the noble Baroness is saying; indeed, I stressed that I took it very much to heart. However, we do not believe that this is quite the right vehicle. What is contained in this and any arrangements that we need to make will be important in any consideration. I was simply making a plea in the circumstances and saying that we have listened to the debate, we have heard the concerns expressed across the Committee and we will take them away and give them serious consideration, even to the point of seeing
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Baroness Perry of Southwark: That was a very gracious speech by the Minister and I thank him for it. Certainly at this point I am not going to pursue the matter but, unless we see something more substantial along these lines on Report, I am not promising that I will continue to remain silent. In the mean time, I beg leave to withdraw the amendment.
Amendments 150 to 152 not moved.
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153: Clause 59, page 44, line 21, at end insert-
"( ) The YPLA shall ensure that by 2010-11 the funding base rates per standard learner number for school sixth forms and further education colleges are equivalent."
Baroness Sharp of Guildford: My Lords, Amendment 153 was debated in the Commons but we feel it is worth bringing forward here because we were not satisfied with the answer that came from the Commons.
The numbers studying for A-levels and other level 2 and 3 qualifications in FE colleges and sixth-form colleges are considerably greater than in school sixth forms and yet for the past 20 to 30 years-indeed, ever since the college sector emerged as an alternative provider of education and training for 16 to 19 year-olds-the per capita funding per pupil in the colleges has been considerably lower than that received by schools for sixth-form pupils. Traditionally schools with sixth-forms have received quite generous funding for their 16 to 19 sixth-form cohort. Whether running A-level courses or vocational courses it has been accepted that class sizes are often very small, sometimes as few as, or even fewer than, half a dozen and that the degree, therefore, of personal tuition is high.
This in turn reflects on costs. In the old days of block grants, schools used to cross-subsidise their sixth forms. Once this was translated into funding formulas, it was reflected in a generous funding of the "standard learner numbers" for those over 16 and remaining in school. By contrast, colleges, which have traditionally concentrated on post-16 courses, have been funded on the basis of standard class sizes, with additional funding only for those with learning difficulties. When the LSC took over in 2001, the gap was more than 20 per cent; by 2005, when Ruth Kelly was the Secretary of State, it stood at 10 per cent, and she famously promised to eliminate it. Sadly it is still there.
The purpose of the amendment is to bring the existence of this gap to the attention of Ministers and to make a last ditch attempt to eliminate it. Given that more students study post-16 in further education colleges and sixth-form colleges than in schools, it is cheaper
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It is shocking that these colleges, which already take a disproportionate number of young people from the more disadvantaged homes for 16-plus education, should receive less per student than the schools. It reflects, in many senses, an outdated class system that should have been eliminated long ago. As I have said, Ruth Kelly promised in 2005 to eliminate the gap. The college sector is still waiting for Ministers to honour that promise, and I hope that they will do so today. I beg to move.
Lord Young of Norwood Green: My Lords, Amendment 153 would commit the YPLA to equalising the basic funding rate for a given programme of learning in schools and FE colleges. This important principle, that publicly funded providers of learning should receive comparable funding for comparable provision, has been at the heart of government policy and the work of the Learning and Skills Council in planning and funding post-16 learning for a number of years. We recognise that there have been historic differences in the way that schools and colleges have been funded, which has given rise to a gap in funding. In 2004-05 this gap stood at 14 per cent. We have responded to that by committing ourselves to a reduction of the gap by eight percentage points by the end of the 2008-09 academic year. I am pleased to say that, through the work of the Learning and Skills Council, at the end of the last academic year we had achieved that 8 per cent point reduction in the gap. This achievement has been verified by independent research published in 2008. We are not there yet, but I hope that the Committee-or at least the noble Baroness, Lady Sharp-will agree that this represents significant progress, although that is not to deny the validity of the point that she was making.
As I have expressed before, I also share some of her concerns about the nature of what we hope in the future will be more independent and balanced advice and guidance. The noble Baroness was right that there tends to be a move towards pushing everyone towards A-levels when for some the vocational route would be more appropriate and valid, and in the end could still lead them to undertake degree-course studies. So we intend to improve the nature of that advice and guidance, and indeed we are committed to doing just that.
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My noble friend Lady Morgan confirmed at Second Reading that the Young People's Learning Agency would continue to operate a national funding formula as the basis for funding schools and colleges beyond April 2010, and that important commitment will ensure that the achievement to date in narrowing the gap is sustained. While we will continue to make progress as funding allows, I hope that the noble Baroness will agree that our foremost priority in our use of public funds must be fully to fund a learning opportunity for every 16 to 18 year-old as we move towards raising the participation age to 17 from 2013, and to 18 from 2015.
I hope that with that caveat, but with the assurance that a national funding formula will remain central to our plans and that we understand the importance of sustaining our commitment to remove that gap, the noble Baronesses will feel able to withdraw their amendment.
Baroness Perry of Southwark: I could not quite understand whether the Minister was saying that for the next year the 8 per cent differential will be sustained or that it will disappear.
Lord Young of Norwood Green: It will be sustained and, unless my numeracy skills are wrong-I hope that they are not-we have said that we have achieved an 8 per cent reduction. I hope that I have got this right. So it is 6 per cent, actually. Sometimes I worry about my own numeracy skills, but I thought I could manage 8 from 14. So the straight answer is yes, it has been narrowed to a 6 per cent gap, and we are committed to sustaining that. Definitely.
Baroness Perry of Southwark: You are committed to leaving it at 6 per cent, not reducing it by a further percentage?
Lord Young of Norwood Green: In my answer, I pointed out that we also have to manage the question of raising the participation age from 17 from 2013 and 18 from 2015. There is a balancing act to achieve there. We are absolutely committed to sustaining the 6 per cent that we have at the moment. If we can make further progress then, of course, we will-but we cannot ignore the scenario. It is a very important step forward in raising the participation age.
Baroness Howe of Idlicote: Perhaps the Minister could make it clear to me, because I am a little confused about this. I thought that there were plans to ensure that deprived areas had rather more resources available to them. How does that fit into the scheme?
Lord Young of Norwood Green: I must apologise. I was slightly distracted, so I missed the point that the noble Baroness was making.
Baroness Howe of Idlicote: I was asking whether the Minister could clarify the position for me. I had thought that although getting parity was a good idea, in reducing the percentage, nevertheless there were special funds for those from deprived areas. How does that fit into this?
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