Examination of Witnesses (Questions 660
WEDNESDAY 27 FEBRUARY 2002
660. In your contract the ILA website had to
be available 90 per cent of each day, otherwise there were penalties.
You gave various figures, for example 93.5 per cent, 93.06 per
cent and so forth. Are those percentages simply that the website
was available or did they take into account of the fact that we
heard from a lot of training providers that they would try to
log onto the website and they would be in a queue and would never
get through? So does the 93 per cent or 95 per cent availability
simply mean that the site was operating and the call centre was
operating, or did it allow for people in a queue who never got
through. So although the site was available 93 or 95 per cent
of the time, an awful lot of people were not actually able to
get onto it.
(Mr Pilling) My understanding is that that is saying
the site was available and I do believe it also means that people
were not queuing, but were able to get through.
661. Just before we leave our intruder, why
are you so certain? Some of us here are Hollywood movie buffs
and we have seen so many movies which show you can get into a
computer in seconds and extract data. Indeed there was a Professor
at a research institute in Britain only this week on the Today
programme who told us that in a matter of 15 seconds valuable
information was stolen. How sure are you that this intruder was
harmless or not the sort of intruder who could obtain information
from the database.
(Mr Doyle) It depends on why they are there. If they
are there to take something which is valuable and is quickly saleable
then what they are after is the chips out of the boxes. A lot
is about what they are actually going in to do.
(Mr Pilling) The point is that you are talking about
accessing through a computer system, through a screen, taking
information out. You can do very fast things through that. The
break-in we alluded to earlier was a physical attack, so therefore
you have to lift whole data boards out and that takes a lot of
time, you have to unscrew the back of things. It was physical
access. You cannot do that in a matter of seconds or even minutes.
662. The lessons learned. We want to move forward,
we are not quite sure about the extent to which you are going
to be involved in a new ILA, but we are keen that you are involved
with the Department in understanding what went wrong and how a
new system can be put in place. If I were to ask you what the
key issues were for you, perhaps in this meeting this afternoon,
what are you going to say to the Department, the key issues for
improving a new ILA scheme from your perspective?
(Ms Metcalf) It is some of the points I made earlier
in relation to the provider element where perhaps some of the
controls ought to be applied before they are able to join a national
ILA database. We would want to see a closer relationship between
ourselves and those providers in terms of us being able to ensure
that they met appropriate IT security arrangements, that all of
them, bearing in mind some of them are quite new providers, who
have access to the system have properly trained personnel and
that they use the right disciplines in terms of changing ID user
access, that they recognise those sorts of disciplines. We would
want to be a bit more proactive and a bit more involved in terms
of that. Simon might expand in a moment in terms of security.
Internally we have quite rigorous system security processes and
we have kept a separation of duties and responsibilities between
the provider database and the individual database which we would
see as appropriate going forward. I suggested earlier we might
like to encourage the Department to look at splitting the payment
profile, so that although it is a departmental issue we have some
way of saying this person has signed up for a course and then
a mechanism to check they have actually attended the course, that
is had the product delivered, before a second payment is made
to the provider. There is a possibility of a scheme link in there
where we contact the individual part way through their course
and ask them to confirm attendance. That sort of discipline or
663. Would that add increased costs?
(Ms Metcalf) That is why I say it is an element of
balance. One might like to link that to the risk profile of the
provider. It sounds quite complicated but if you give the providers
a risk rating, then you might want to do more checks. You would
not need to write to every account holder but you might have a
profile which says you write to one in 50 in a long-term public
sector body; you might write to one in ten with the new provider.
If all of that is positive in the first 12 months, the next 12
months you might only write to one in ten. You can develop a risk
register with them in terms of trying to keep an eye on administrative
costs, but also ensuring that you have the right sort of mechanisms.
We would also want to have a more rigorous information system
that would recognise that reporting after the event is perhaps
too slow. We need now to look at a system which produces more
reactive management information reports, more exception reports,
so that should there be any issues we can alert the Department
or indeed ourselves to take action.
Mr Shaw: Thank you very much. It does seem from
what you have said that you have many of the solutions at your
fingertips and I hope the Department will take heed of those.
664. In trying to look forward can I just have
your assessment of how practicable ILA 2 is going to be in trying
to get a balance right between having a universal approach to
Individual Learning Accounts, something that is unbureaucratic,
so does not stifle entrepreneurs coming into the market, and at
the same time ensuring that there is no abuse of the system? Bearing
in mind that we had ILA 1 where you were very experienced players,
you had a good working relationship with the government, but it
ended up in a shambles, how can we move it forward now? Can we
have the universal approach to Individual Learning Accounts but
keep it tightly controlled and ensure there is no abuse?
(Mr Doyle) I believe if we want to continue to get
the number of people we got in ILA 1 that it has to be done on
some form of national basis. One of the biggest challenges we
face, once we really get down to the nitty gritty of this, is
how to do that and get the balance you are talking about. If we
have everybody running scared in terms of being frightened that
somebody is going to make a mistake here or that there will be
any abuse at all, it will close this thing down so far that the
government will have difficulty spending its money. It is where
you move people from that swing I was talking about earlier. In
the situation where we find ourselves people move to being very,
very protective. It is about getting those discussions moving
and finding somewhere in the middle where people say okay, there
is risk in there, we understand that there is risk in there but
it is risk we believe we can control at a level at which we can
live with it. We are still a little way away from that yet. As
a private company we would probably be more on the risk side of
the things. The Department would come from the more protected
side of things. The hope is that between us we can move to something
in the middle which gets a sensible balance. We can. The experience
is not a great one to have gone through but history is a wonderful
teacher. From the experience we have, I think we can get to the
665. May I just press you on that? Forgive me
for being slightly sceptical here in the sense that we have you,
a major supplier of help to the government when it came to education
services generally, very experienced in the field, good communication,
according to you, between you and the Department in question,
yet you got it badly wrong. How are you going to make sure, what
provisions are you going to introduce this time, which are going
to ensure that the ILA 2 is going to succeed this time? What are
you specifically going to recommend in order to make sure that
we get this balance, if it can be achieved?
(Mr Doyle) The biggest single factor will be that
the business model in ILA 1 was proved to be wrong. I cannot see
this time round that we are not going to work through that business
model in every which way.
666. Could you be more specific? When you say
the business model was wrong, what do you actually mean?
(Mr Doyle) The business model in terms of a completely
open, non-bureaucratic system with IT systems at the back end
which were mirroring that openness was wrong. It did not work.
We now have to back off and rebuild a business model which tries
to keep the best things from ILA 1 but tries to close down all
those things where the business model obviously failed. That would
be tested and tested, which I do not believe it was in ILA 1 before
the contract was put in place with us or this scheme was delivered.
667. Does it surprise you that we have only
had one successful prosecution?
(Mr Doyle) It frustrates me; I am not sure it surprises
me. Having had a couple of conversations with the police, there
are some elements of this where it was very difficult to decide
whether it was fraud or not fraud. I do not understand all the
elements of that. As a simpleton in it, when I see some of the
abuse that went on, it frustrates me that there are not more prosecutions.
668. Are we going to have a more open, transparent
relationship between yourselves and the Department in ILA 2? We
had both yourselves and the Department to a certain extent backing
each other up but in other respects being critical. At the same
time nobody was ever privy to the conversations you had or the
warnings you had. Is there some way that those who are interested
in this, interested in seeing ILA 2 succeed, can be privy to the
communications between the two parties, between yourselves and
the Department, to make sure that there is a radar there to highlight
potential problems at an early stage?
(Mr Doyle) I do not think our intention, or the Department's,
was not to be open. Both of us found ourselves in a difficult
situation over the last few months. As an organisation we are
an extremely open organisation with our customers and we are happy
to be that way and we shall continue to be that way. We have no
objections and we welcome third party involvement in the contracts
we have won because you can learn. We do pride ourselves on having
experts, but there is always someone somewhere who knows more
than you do and who bumped into something last week or the week
before. The government have a large number of those specialists
themselves. We welcome the opportunity of people coming in and
looking at what we are doing and giving constructive criticism
or ideas in terms of how we make improvements at that time.
669. In terms of future lessons, we are trying
to look at ILAs as the testbed for a private/public sector partnership.
One of the frustrating things in what I have heard from both yourselves
and from the Government is that in a sense here was a scheme in
which you often described yourselves as partners but when we actually
push you, you do say you were only responsible for that and they
were responsible for that. Then when we try to push as elected
representatives at what the contract looked like, the contract
is confidential so we really cannot see in detail what the basis
of the contract was and we have to take the government's word
and your word for that. What frustrates us in a sense is that
if you were involved in ILA 2, very much what this Committee would
like to understand would be that that was based on a genuine partnership
so that as partners, if something goes wrong, you stand together
and say together, corporately, you made a mistake. In a sense
that has been the frustration of some of the evidence we have
had from yourselves and the government. What we are trying to
push, for example if you are now going to be advising in a much
broader way on ILA 2, is that if we ever wanted to come back to
it, because we hope the next time we see you will be when ILA
2 is a great successyou, or whoever, are in partnership
with governmentwe would be pushing you to explain the lessons
of the success rather than the failure. Can you see what we are
pushing to? Here is a very interesting point of public policy
which has implications right across a number of departments and
where we are trying to get is what went wrong with this one, to
learn from the lessons and then also from our point of view how
we in future find out, make you accountable, so that we can scrutinise
what went on. Do you have any suggestions how that could better
(Mr Doyle) We would welcome that approach. I am not
sure who would do it, whether a third party in its widest sense,
not us and not the Department, but if something were set up where
some body wanted to come in and see what was going on, how we
were progressing, how we were knocking over issues between us,
then we would welcome that. There have been comments about the
way we and the Department may have behaved over recent weeks.
We have worked closely with the Department, we have considered
ourselves close partners with the Department. We have both been
tested over recent months. A lot of stuff has been thrown about,
some of which is true and a lot of which is not true, but it still
hits papers. We are a good company. The Department have their
responsibilities. It tests it. On the whole we have come through
it not too badly really, but it is a test and it is difficult,
a difficult time. We would most certainly welcome that open approach.
670. Why I pressed you at the beginning was
that you have just said you have come through it not too badly,
but there are an awful lot of people out there who are casualties,
lying about the place, whom we have to restore to health. We have
to bring them back into provision of training, we have to re-energise
them into being excited about ILA 2. Let me give you two examples.
When we see you again, we will want to know, for example, if you
are involved in ILA 2, what you said about dead weight. We are
very concerned as a Committee about this term dead weight. We
would hate to see an ILA 2 specifically only going for those people
who have never had any training. Some of us believe that would
ghettoise training. One of the refreshing things about ILA 1 was
that it was open to all. It was open access; something many of
us in the field have been looking for for a very long time. In
a sense what we want you to be able to say is that you gave that
advice, you are a very experienced organisation, you spoke to
the Department, you are changing cultures here. Also you are saying
to the Department that speed is of the essence. You remarked that
you had come through it all right. A lot of people have not and
need action soon.
(Mr Doyle) I was really referring to the partnership
between us and the Department; that the partnership has been tested
and has stood up reasonably well. That is what I was referring
to. Your point is extremely well taken and the people out there
who are having difficulties do exist and there is no-one more
than we who would like to see this move forward at speed. It is
the best thing for all of us to get something underway again as
soon as we possibly can.
671. When you go round to Great Smith Street
this afternoon and you are discussing the new ILA, do you think
there is a strong argument for retaining that brand name? It is
something people are familiar with and companies spend lots of
money branding themselves and re-branding themselves.
(Mr Doyle) I am not an expert on marketing or branding
but my own view is that whilst tarnished, I do not think it is
dead. It still has a value.
(Ms Metcalf) I would agree with that.
Chairman: No suggestions for a new brand name?
672. A Doyle, a Metcalf.
(Mr Doyle) No, please, there are enough Doyles in
673. Your comment about welcoming someone to
oversee fills me with horror in one sense. I do not want to see
yet another accounting firm or somebody else coming into market
to get their cut in this and make it more expensive. Last time
you were with us, you suggested that because the monitoring of
the provider and now the monitoring of the product was so important
perhaps there should be someone, since you were not that person,
who was the educational expert. When I put this to the Minister
he did admit that the DfES ought perhaps to be the educational
quality assurance people. Do you think there should be someone
else in that triangle as it would then become, doing that specific
role for the DfES?
(Ms Metcalf) It might be useful purely from an operational
perspective because it is a very practical thing. Although I am
sure the Department would want to be involved in setting the protocols
and the standards, you are talking about quite a hands-on role
and I am not sure that is one the Department would want to get
involved in on a personal basis or whether they would go through
674. Like the LSCs?
(Ms Metcalf) Possibility.
675. You are still concerned that that area
is of such importance that there really does need to be someone
other than the DfES involved.
(Ms Metcalf) It is recognised that it is an important
area. I am not saying it would necessarily have to be other than
the DfES. I am saying it is quite a hands-on role.
676. Is that part of the discussions which are
now going on in the DfES?
(Ms Metcalf) Yes.
677. It is. I want to end my comments with the
urgency again. Have you any idea when, as far as you are concerned,
all of this is going to come to fruition either with you or without
you? Is there anything in your mind that gives you a timescale?
Is it months, is it weeks, is it years?
(Ms Metcalf) We have staff in place, so we are very
hopeful that something might happen.
678. We are desperate that something happens
now, as of, certainly this September. If it goes beyond this September,
then we have not only lost a year but we have lost so much goodwill
and in terms of the providers in some cases their livelihoods.
Where is the urgency? What do you have in mind?
(Mr Doyle) There is urgency. I have no idea of a date.
It has not been our place to push too hard in recent weeks. We
are pushing, we would like to see movement, we have people in
place and we are going to leave them in place as long as we possibly
can so that we can pick up things quickly. I doubt that it would
be weeks; if it is years that is too long and it will all be away
and gone. We now have to push hard and we have a role in this,
if the Department are going to allow us to play that role, in
terms of giving people the confidence to move so that we do not
have people too frightened to move because of the issues which
were around in ILA 1. We have to work very hard in trying to knock
those issues down and give people the confidence to move. That
is what I see as our role now.
679. May I give you some advice on quality assurance
and a good brand to be associated with? I hope you will take this
seriously. The Open University. The Open University has an outstanding
reputation for quality and quality assurance. Speaking to the
relevant people in the Open University may be very valuable. I
have to say that brand of the Open University is one which over
30 years has built up an enormous reputation of respect and prestige.
In a sense it would give some je ne sais quoi, that feeling
of excellence. One of the problems in ILA which came out in some
of your evidence and something the Minister said yesterday was
that you had an ILA but what was the brand. Everyone who has taken
even a short course in the OU has a feeling that they are somebody
and in a sense the next step for our ILA is to have that kind
of feel: "I did ILA and I got it" and it is something
to be very proud of. I do hope you will talk to someone at the
(Mr Doyle) A point well made.