Select Committee on Education and Skills Minutes of Evidence

Examination of Witness (Questions 280-299)



Mr Chaytor

  280. Minister, on the question of convergence of funding (16-19) the Government's policy is for convergence between school sixth-forms and further education. When will that happen and how much will it cost?
  (Mr Lewis) We have made no commitment to a timescale, we have expressed an aspiration and believe that it is right that that convergence takes place but we have said quite clearly that it is in the context of available resources. It really returns us to the discussion that the Chairman was quite rightly raising earlier about the different choices and different priorities that have to be made. Therefore, the aspiration is there should be convergence, the decision will be made in the context of available resources and all the other decisions that have to be made.

  281. So we will not know until the Comprehensive Spending Review next July?
  (Mr Lewis) I think it would be very unlikely.

  282. Part of that convergence process is the guarantee of funding for sixth-forms whose numbers do not fall. Is that an aspiration or is that a guarantee and does that have a time limit to it or is that forever?
  (Mr Lewis) There is no time limit, it is more than an aspiration and, at the moment, it is a guarantee.

  283. At the moment it is a guarantee?
  (Mr Lewis) It is a guarantee.

  284. It might not always be a guarantee?
  (Mr Lewis) It is a guarantee. It was in the Labour Party's Manifesto at the general election, therefore, it is a guarantee.

  285. It will remain a guarantee?
  (Mr Lewis) It will remain a guarantee during the period the Labour Party Manifesto takes effect for this term and the Government will, no doubt, return to this subject at a later stage.

  286. It is a guarantee for the whole of this Parliament?
  (Mr Lewis) Yes.

  287. Given that the existing funding for schools and further education, respectively, is based on schools getting an increase each year and further education getting a reduction each year, the difference is actually widening as each year goes by, if the convergence is not brought about, surely?
  (Mr Lewis) It depends.

  288. What I am saying is, is the problem not getting worse, and, therefore, is it not crucial that a timescale is given, because the schools budgets are going up by RPI plus x per cent a year and so college budgets are coming down by RPI minus x per cent. So the gap is getting wider year by year.
  (Mr Lewis) I think, again, we need to look at this in the context of the issue as a whole. There is the fact that we will have a much bigger idea very soon of the overall cost in terms of where numbers in school sixth-forms, for example, are dropping significantly and where they remain the same. The real terms guarantee is linked, as you know, to pupil numbers. So that is absolutely integral to the real terms guarantee. There is also the LSC's responsibility for looking at 16-19 provision generally in the area of inspection plans and the new responsibilities that they have there. Clearly, one of the issues that will have to be addressed over the next few years in terms of the LSCs responsibilities in terms of defining high-quality provision at 16-19 in each locality is the consequences of differential funding levels in different institutions. That is something that will have to be addressed as part of that process.


  289. Minister, I visited my technical college last week and my Learning and Skills Council in Yorkshire on Monday. In what time? The places that you have said that you care about most are institutions that are dedicated to training and giving relevant skills to the more deprived members of communities—and we are very pleased they are staying on at 16—but they are under the most terrible pressure now. My technical college in Huddersfield, which does a wonderful job, has more students than the local university but is under tremendous pressure for funding now, and if we wait much longer, I was told only last Friday, they are going to cut engineering training, they are going to cut electronics and cut catering. What sort of sector have we got and what sort of Government have we got if we say "Over the years, in the long term we are going to balance"? The emergency and the urgency for that sector of education is now. Members of this Committee really want to know what are you going to do about it now, not only in three or four years?
  (Mr Lewis) The answer is that we are not in the short-term going to be in a position to change that. We have acknowledged that from a policy point of view and from a reality point of view we need to achieve that convergence over a period of time, but that is not going to change within the next year, 18 months or two years. It is going to have to be in the context of difficult decisions made about the spending review and, also, the amount of money that we make available to Learning and Skills Councils.

  Chairman: I hope the alarm bells are ringing.

Mr Chaytor

  290. Going back to the issue of consistency in government policy, on the one hand we have got the move to rationalise small sixth-forms with falling numbers—and this is the Government's view and it is the Learning and Skills Council's view—but, on the other hand, we have a White Paper that encourages every new school who wishes to, to open a new sixth-form. Is there not a contradiction there? By definition, every sixth-form that opens is going to a small sixth-form which is going to be struggling for numbers and it is going to increase the funding problem. Is there not an inconsistency there?
  (Mr Lewis) I think for school sixth-forms to, ultimately, be successful, if a school wishes to create a new sixth-form, then there will have to be a linkage between that and the existing provision within the area. If you simply say any school that wishes to can set up a sixth-form without any regard to the rest of the provision, collaborative and partnership—

  291. The White Paper does say that. It does not describe the mechanisms by which they will be established. It does say, however, that it wants to encourage any new school that wishes to to establish a sixth-form.
  (Mr Lewis) We believe there is an important place for school sixth-forms within the system, and for more and new school sixth-forms. There is no suggestion, as far as I am concerned, that that will be irrespective of existing provision, as defined by the LSC, both in terms of quality and capacity with regard to whether those new applications talk about collaborative and partnership arrangements with existing institutions. All of that will have to be considered before we make decisions to spend money on the expansion of school sixth-forms. It has got to be a credible, robust application which demonstrates a need and a justification, and fits with our raising standards agenda but also fits within the provision for a particular area.

  292. You would accept that for every new school sixth-form that opens the bill for convergence is going to be higher?
  (Mr Lewis) I would accept that if we simply said there was going to be significant expansion of school sixth-forms and there were no other changes or reconfigurations within 16-19 provision anywhere in the country, that would be accurate. However, we also know that, as we home in on this phase of education, we have area inspection reports, we have the new responsibility of the LSC, and it is very, very important that we ensure that in each area there is appropriate provision and relevant provision and, therefore, there is appropriate configuration. We will not be imposing that. If this is a popular local facility that seems to be working well, the Government is not going to close it down, but if it is a sixth-form—be it a college or a school—and it is clear that numbers have declined to such an extent that parents do not regard it as a valued option any more, it is by stealth in decline, we have got to do something about it. It would be irresponsible simply to allow that situation to continue.

Paul Holmes

  293. You said that school sixth-forms will have their money protected as long as their numbers do not drop. Can you clarify what the details of that are? I was the head of a sixth-form for the last twelve years and I know that in some years the number of pupils coming into our Year 12 would be less than in others and in some years more. Sometimes you could not see any reason why that was; sometimes it was just a population bulge that was coming through or there was a low Year 11 cohort to draw on. So there were all sorts of reasons which are nothing to do with particular sixth-forms why figures fluctuate up and down. Over what period of time do numbers have to drop before the school loses its guaranteed funding? Is it one year, is it over six years?
  (Mr Lewis) You can probably answer the question better than I can, really. I will try. It is complicated. There has been a significant consultation process and we wanted to get this as right as you can get it when you are moving from one system to another. We believe the approach that we have adopted does reflect more what people have said they wanted than not. So we have tried to listen. The baseline starting point is the amount of funding that was allocated via LEAs based on what they tell us for the year 2000-01—the beginning of that financial year—based on the information they have provided to the department in terms of what they were spending on school sixth-forms. In terms of numbers, at what point do we look at: "Has there been a decline or an increase or have numbers stayed the same?" We are talking about the September 2001 figures. So those are the baseline indicators, if you like. There is a guaranteed increase, I think, over a two-year period in terms of inflation of 3 per cent per year. In terms of increases or reductions in numbers, I think the figure that has been agreed is £2,600 per pupil. So that is the sort of starting point. That is the framework and, clearly, the Learning and Skills Council—and it has been based on very in-depth consultation, as I say, and trying to get consensus—has to work on that framework and that financial regime.

  294. So if numbers going into Year 12 went down next year in a particular sixth-form because there was a smaller Year 11 cohort to pull from, they would then lose funding. If numbers went up the year after because there was a larger Year 11 cohort, would the money go back or once you have lost that guarantee you have lost it forever, even if your numbers then go up the next year or the year after?
  (Mr Lewis) I think there would have to be a consideration by the LSC of a significant or unusual set of circumstances which led to a one-year blip which did not seem to be logical or did not seem to make any sense. We would have to look at the possibility of the LSC using some discretion in those circumstances. In most cases, however, the formula I outlined will be the one used. That will be the starting point. I accept that that can lead to situations where you may have one year where something unusual or out of the ordinary happens, and there will be an opportunity for the LSC to consider that in the context of an individual institution where that happens, but the financial regime is as I have outlined. I acknowledge it is very difficult from day one when there is such a shift, to get it right. I think they have got it as right as we can get it.

  Paul Holmes: So the implication could be that just one year's drop, for whatever reason, that is it, you lose the guarantee. Also on that—I am sorry, I have lost the thread.

  Chairman: Jeff Ennis can come in, and we will come back to you.

Jeff Ennis

  295. I would like to put you in an actual scenario, Minister, and get your response to the situation in Barnsley. In the early 1990s (at the time I was Deputy Leader of the Council) we persuaded all the parents and all the staff to close all the small sixth-forms in Barnsley and go over to a more or less homogeneous tertiary college system. In fact, the only other sixth-form in Barnsley is the grammar school, which is not a grammar school but a fully comprehensive school, right on the fringe of the borough in Penistone, which is inaccessible to many areas in the east of the borough. Given the fact that we have differential pay and conditions at the present time between staff in colleges and in schools, we have now got the potential leakage of staff from Barnsley College—and the surrounding colleges, by the way, have still got their fair share of sixth-forms—into the surrounding sixth-form school provision. What are going to do or what can you do as a minister and as a government to actually stop this haemorrhage from happening in both the short term and the medium term?
  (Mr Lewis) I think we have to look at ensuring that we do value FE provision in the way that it should be valued and recognise that it has an absolutely essential part to play. One of the things that we are looking at at the moment, for example, in response to the sector making some very strong and, I think, fair representations to us, is the whole issue of bureaucracy and red tape, audit, different funding streams which go in to the colleges. This has been a—

  Chairman: The question was specifically pay.

Jeff Ennis

  296. The differential pay rates.
  (Mr Lewis) We have to address that in due course. Again, we have to do that in the context of limited financial resources and hard choices. I probably sound like the Iron Chancellor now!


  297. Minister, you started your statement saying you cared very deeply about what we always talk about here, the 30 per cent of non-achievers, the people from socially-deprived backgrounds, who do not get education. What we are bringing you to, towards the end of our discussion, is the very sector that deals with those people, who actually do manage to keep them on—and, increasingly, perhaps, with the EMAs and your policy will keep them on. This is the area that is feeling more of the pinch, in terms of good quality teaching, and holding the quality of teaching in FE, and that is why we are bringing you back to this. It is a very serious challenge to the Government at the moment. Most Members of this Committee are not happy about how speedily the Government is reacting to this. It is all right saying "It may resolve itself"; what Jeff Ennis was saying is this is an emergency and an urgency now.
  (Mr Lewis) The Secretary of State made an important speech this week in this particular area of policy, which was generally, as I understand it, well-received by the sector, where she made it absolutely clear that we are extremely committed to the integral and central role that FE plays, and that we understand and acknowledge there are difficulties that we have to address. That is the starting point. We clearly need to look at terms and conditions and we clearly need to look at the quality of provision. We need to look at that in the round.

  298. You would like to pay a bit more within this sector, really?
  (Mr Lewis) We would like to see, I guess, two things: we would like to see a clearer focus with regard to performance and we would also like to look at the terms and conditions of staff. If they are not being paid the appropriate amount to attract and retain high-quality and high-calibre people, then any government that is responsible has to consider that.

Mr Pollard

  299. Moving on to modern apprenticeships, there is a distinct skills shortage; try getting a plumber or a carpenter, etc, etc, you cannot get them. There is a great danger that this shortage will hold back our economy. What are you doing to develop greater awareness and understanding of the modern apprenticeships scheme amongst employers?
  (Mr Lewis) It is true that whenever we meet employers they say "It's a shame we do not have apprenticeship any more". However, as I became aware recently, obviously, we do have not only an apprenticeship but a very good one in terms of modern apprenticeships. The Cassel Committee which has now reported, which has looked at modern apprenticeships in a variety of ways, has come up with some very important and very useful recommendations as to how we make modern apprenticeships of high-quality, how we make them readily available and how we persuade and encourage as many employers as possible to offer modern apprenticeship opportunities to young people. The Government and the Learning and Skills Councils will be responding formally to the Cassel recommendations next week, and one of the fundamental outcomes of that will be that we will invest a significant amount of resources and effort in marketing and promoting modern apprenticeships, both to young people—because it is very important that they see them as a high-value, high-status option route—and employers. As a consequence of the Cassel recommendations and the Government's response, in a sense, what that does is put the framework down and creates a structure and a vision for the direction of what we intend to do to raise the profile, increase the number of young people going down the modern apprenticeships route and raise the status of that route for young people.

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