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Education and Skills Bill

My Lords, I understand noble Lords’ intentions in tabling these amendments. My officials and I have met them on a number of occasions since they raised similar amendments in Committee. The noble Baroness, Lady Sharp, accuses us of a lack of inspiration and aspiration. I find that a bit over the top given that here we are discussing an Education and Skills Bill which is raising the participation age and applying free funding to a significant range of individuals. I reject her charge. I feel that, as we approach Christmas, I am somehow being labelled Scrooge and I will endeavour to prove that that is not a fair description. This Bill gives us something extra in our efforts to raise skill levels. For the first time it introduces a legal requirement to ensure the Learning and Skills Council waives fees for adults undertaking specified basic skills—first full level 2 and, for adults aged 19 to 25, first full level 3 qualifications. This is a really strong signal of the Government’s commitment to supporting skills development. Amendment No. 74 would extend to those aged up to 30 the duty on the Learning and Skills Council to secure free tuition for a first full level 3 qualification. We know level 3 skills deliver good returns to individuals and the economy. The returns over the lifetime of a person moving from level 2 to level 3 are around £45,000, so it is right, as the noble Lord, Lord Leitch, said and many employers demand, that as many people as possible should be qualified at higher levels, including at level 3, which is often a gateway to further higher level learning. However, level 3 learning programmes do not come cheap and our initial analysis is that extending the duty on the Learning and Skills Council to include free tuition for a first full level 3 qualification for adults aged between 25 and 30 would cost around £85 million over the next three years. This includes education and training secured by the LSC through both Train to Gain and mainstream further education routes. We are already doing much to help all adults, including those over 25, to reskill and upskill by helping them gain full qualifications at level 2 and level 3. Compared with 2001, there are now 2.2 million more adults of working age with qualifications at level 3 and above, and around 100,000 adults achieved a level 3 qualification in 2006-07 through LSC-funded programmes. Over the next two years alone, we plan to increase by 20 per cent the investment in level 3 training that the economy needs. I do not see a lack of aspiration in that kind of investment. Unfortunately, if I were to agree to this amendment—and I reassure the noble Lord, Lord Dearing, that we have considered it carefully—I would have to divert resources within the Learning and Skills Council’s budget away from the priorities that we have set out for the next three years. That would have a significant impact on the provision available for the lowest skilled and most disadvantaged individuals in the country—a subject on which I know from my conversations with him that the noble Lord, Lord Dearing, has strong feelings. I want to address the question of competitiveness, which was touched on by both the noble Lord, Lord Dearing, and the noble Baroness, Lady Howe. Compared with countries such as France and Germany, we have far fewer young adults achieving a level 3 qualification. Evidence shows that the number of 19 to 21 year-olds qualified to level 3 as a percentage of the population is on a par with our competitors in Germany, the US and France. However, our competitors have caught up and overtaken us in relation to 25 year-olds: 74 per cent of adults aged between 25 and 28 in Germany and 62 per cent in France have level 3 qualifications or higher, compared with 54 per cent in the UK. We need to build on a strong base up to the age of 19 to keep pace with other countries, and that is a rational and reasonable approach. Even when the other provisions in the Bill that raise the participation age are fully implemented, there will still be young adults up to the age of 25 who, for various reasons, will benefit from being able to undertake level 3 qualifications without having to pay tuition fees. I have cut out some of the argument in the interests of time, not because it was not necessarily important. In Amendments Nos. 75 and 76, noble Lords focus on the other end of the learning spectrum and wish to make qualifications within the foundation learning tier free to those aged 19 to 25. As a Minister with responsibility for skills, I am fully behind the goal of supporting the most disadvantaged adults in developing new skills and bettering themselves. This is already a key objective of the Government and a core mission of our department. I wish to be clear, as was the noble Lord, Lord Leitch, that level 2 is the platform of skills that will make a real difference to an individual’s career prospects. People with skills at level 2 or higher are half as likely to be unemployed as those with skills below it. There is no evidence that individuals achieving qualifications below level 2 reap such fruitful returns. Therefore, it is right that we prioritise our efforts and resources on supporting as many individuals as we can in getting to this level. We have a set of actions already in place that we believe will address the concern expressed by noble Lords that, for some learners, a full level 2 qualification is an extremely challenging step. Those in receipt of means-tested benefits and many on the working tax credit do not have to pay tuition fees for any LSC-funded learning. This includes those undertaking qualifications which will, in the future, be part of the foundation learning tier. In addition, we continue to drive forward integration of the employment and skills services that we offer jointly with the Department for Work and Pensions to ensure that the most disadvantaged individuals are given the opportunity to develop the skills that they need to find sustainable employment and progress in their careers. We are backing up our commitment to learning below level 2 with significant funding. Each year we invest a total of £1.5 billion in learning below level 2. Again, that does not strike me as lacking in aspiration or willingness to invest. In 2008-09 alone, we expect to support more than 2.2 million LSC-funded places on learning below level 2. Shortly, we expect to publish the Learning and Skills Council’s grant letter for 2009-10, which will reflect our strategy for continuing investment in further education and skills. I should like to address the point that the noble Baroness, Lady Verma, emphasised. We believe that equipping people with essential skills in numeracy and literacy is one of the best ways in which we can help them. I know that the noble Lord, Lord Dearing, and the noble Baroness, Lady Howe, wanted what they saw as a rather modest extension to that to include information and communications technology. Having done a bit of investigation, I can say in response that in many cases of improving literacy and numeracy, ICT is used as a means of delivery. It is a very good means of doing it. Also I am told by those involved in further education that it is not the only means of delivery. Some people respond much better to embedding this in other forms of delivery. We are going some way towards equipping people, albeit not quite as far as the noble Lord, Lord Dearing, and his supporters wish. I stress that we still believe that we have got it right in focusing on numeracy and literacy, as did the Leitch report. We are committed to examining the scope for extending administrative entitlements to free learning into the foundation learning tier in the future, as set out in the Adult Learning and Skills: Investing in the First Steps document, which we published in November 2007. Over time and as resources allow, we will concentrate public funds on programmes that align with these ladders of progression. In particular, we have stated our commitment to look at extending the administrative entitlement for 19 to 25 year-olds to foundation learning tier programmes. The Government will continue to monitor progress towards the ambitions of the noble Lord, Lord Leitch, very closely. In the future, should we decide that we are in a position to extend the funding duty in proposed new Section 4B(4) to courses below level 2 or to those aged over 25 at level 3, the proposed order-making power in proposed new paragraph 9 of Schedule 1A will give the Secretary of State this flexibility. I return briefly to the question asked by the noble Baroness, Lady Howe. The Leitch report did not say 45 per cent; it suggested exceeding 40 per cent at level 4. In response we said that we would aim for 36 per cent of adults qualified at level 4 and above by 2014, on the way to world class by 2020. This is up from 29 per cent in 2005. I shall write about the impact of measures to get to level 4 because the amendment is on level 3. The noble Baroness has that assurance. I hope that noble Lords are sufficiently reassured that the Government are serious about improving higher level skills and supporting the most disadvantaged adults, and that the Bill builds in flexibility to reassess our priorities in the future. We do not have infinite resources, but we believe that we are focusing and targeting them in areas where the Leitch report indicated there was the greatest need, and in areas where employers identified the greatest need. That will benefit employers, employees, and the country as a whole. In light of that I hope that the noble Lord will withdraw his amendment.