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Either Lord Adonis was wrong then and the Minister is going to tell us so, or we have a real problem.

Nick Ainger: The hon. Gentleman is quite right, which is why I am seeking an assurance that the Order in Council process can actually deliver degree-awarding powers to FE colleges in Wales. It is a very important point and, as I say, I really hope that the Under-Secretary will come up with the same assurances that I sought to give to the Committee last month.

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I conclude by saying that we need to recognise that we are to some extent feeling our way in these matters when dealing with the new powers requested by the Assembly. What we should learn from the experience is that we need to participate actively in the scrutiny. I was the only Welsh member of the Committee, but I am sure that it would have been different if, before the Committee stage, Members had been aware of the concerns that they have expressed today. The message needs to go back to Wales and to organisations that represent Welsh interests that this place is still a very important part of law-making that directly affects Wales. They need to engage with us in the same way that they engage with Members of the Assembly.

Adam Price (Carmarthen, East and Dinefwr) (PC): There is a wide consensus in the House that the idea of foundation degrees in further education is an important and progressive step. It does what the hon. Member for Wrexham (Ian Lucas) said, helping to create better, wider and stronger progression routes through further and on to higher education. It is particularly important among many of our most disadvantaged communities, where participation rates in further and higher education are nowhere near as high as they should be. The idea of creating intermediate steps to engage people more fully in further and higher education will be warmly welcomed by all of us.

As the Minister said yesterday in a different context, the settlement for Wales is very complicated. Sometimes even Members of Parliament find it difficult to get our heads around the process with which we must engage. As many Members have said, the process by which we have arrived at this afternoon’s discussion has been far from ideal. I am sure that those lessons will be taken back for consideration.

Will the Minister tell us a little about the specific issue in relation to the Privy Council? While it is right and proper that elected Members of Parliament should debate here all matters that are of interest and importance to our constituents, the proper place for a decision on the shape, structure and future of further education policy in Wales lies in Wales. It is perfectly proper to hold the web review to which the hon. Member for Carmarthen, West and South Pembrokeshire (Nick Ainger) referred, and for a decision to be made in that context, but we should enable the Assembly to decide whether foundation degrees are the way forward. My party believes that there is a strong case for their introduction, but that is ultimately a decision for the National Assembly.

Is the constitutional hurdle that the National Assembly in no circumstances has the power to confer functions, issue instructions or whatever the polite terminology is with regard to the Privy Council? Is that the case for the Scottish Parliament too? Alternatively, could we provide the enabling power to them through an amendment to the Bill? I hope that the new Welsh Assembly Government will allow that minority of colleges in Wales that currently wish to proceed with foundation degrees to do so. It should be possible for us to enable the Welsh Assembly Government to make that decision. The last thing that Plaid Cymru Members would want is to prevent the Welsh Assembly
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Government from conferring that power on further education colleges in Wales that wish to go down that route.

Mr. Hayes: Many Members who have contributed to the debate speak about Welsh affairs with more knowledge than I do. It seems to me, however, that the issue is the methodology or process. Is it appropriate to use primary legislation to extend the powers of the Welsh Assembly when a parallel process is in place to do that? The Welsh Affairs Committee considered that in some detail, and expressed considerable doubt. We might want Welsh colleges to have the same powers—I do, because I moved the amendment—but we need to address the issue of the process, because a big constitutional point is at stake.

Adam Price: Obviously, as a Plaid Cymru Member, I take a maximalist position in relation to conferring powers on the Welsh Assembly Government. The hon. Gentleman is right that there are parallel procedures—the Order in Council process. Depending on the Minister’s discussions, that might be the most appropriate mechanism now for conferring an enabling power on the Welsh Assembly Government so that it can confer the power to award such degrees in turn on further education colleges in Wales. In that regard, it appears that a settled view has not yet been reached, to which the right hon. Member for Torfaen (Mr. Murphy) referred.

The general mood is that, because of the nature of the devolution settlement, an important role for the House remains. Welsh representative bodies in all sectors need to be mindful of that. We should not have this debate in this way at the tail-end of a process; we should have a better, more fully informed process, involving all sections of the appropriate interest groups in Wales.

3 pm

The Parliamentary Under-Secretary of State for Wales (Huw Irranca-Davies): As I rise to address the House for the first time outside Wales questions, I recall a slogan used by the Welsh Assembly Government—“The Learning Country”. We are experiencing a learning process now. Certainly I am learning, but we are also learning how this system works. I hope that I shall be able to reassure Opposition Members and my colleagues about the way in which we expect it to work, and also to convey the view of the Welsh Assembly Government.

I welcome this opportunity, and will attempt to live up to the reputation for “alacrity and enthusiasm” bestowed on me by the hon. Member for South Holland and The Deepings (Mr. Hayes). I pay tribute to the work of my predecessor, my hon. Friend the Member for Carmarthen, West and South Pembrokeshire (Nick Ainger), who not only brought this Bill to its current stage but dealt with the Government of Wales Act 1998. He is due great credit for the role that he played over many months and years. I also note the interest in these matters shown by a number of Welsh Members. The Chamber is quite crowded today, particularly with Welsh and Labour Members.

As has been said, amendment No. 23 would confer on the Privy Council power to specify further education institutions in Wales as competent to grant foundation
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degrees. Let me try to explain the rationale behind post-16 education in Wales, and explain why it is considered appropriate at this time. As the hon. Member for South Holland and The Deepings will know, “Reaching Higher” is the Welsh Assembly Government’s strategy for higher education, which recognises that Wales has a disproportionately larger number of small higher education institutions than England. The most effective way in which to meet learning need, achieve critical mass sufficient to reduce overhead costs and increase access for low-participation groups—mentioned by a number of Members—was for Wales to develop integrated networks and clusters of colleges, including both higher education and further education institutions with shared missions to deliver higher education.

That focus on networked planning and collaborative delivery is far more than mere partnership delivery. “Reaching Higher” emphasised the importance of establishing geographical or function-based clusters of colleges with shared missions. That approach is intended to open up a wider range of opportunities for learners through the sharing of resources such as staff, equipment and infrastructure. As “Reaching Higher” pointed out, Wales is too small a country for any institution to work purely in isolation.

In 2003 a KPMG report on relations between higher and further education institutions, commissioned by the Higher Education Funding Council for Wales, drew attention to the significant costs that would be faced by further education colleges in Wales that sought independently to set up the infrastructure associated with the provision of higher education on a directly funded basis. England has a large mixed economy of further education colleges; Wales, at this moment, does not. The KPMG report concluded:

Such an approach offered cost-effectiveness and economies of scale in areas such as curriculum development. Its success in meeting the needs of Wales has been highlighted by the findings of a further recent independent study of the delivery of foundation degrees in Wales. In a report produced in March this year, the independent consultants SQW pointed out that there was limited support from Welsh higher education and further education institutions for the possibility of granting FE colleges power to award their own foundation degrees.

The representation of Fforwm is relevant here. I will deal with some of the comments about that later, but I will say now that we are aware of certainly two, perhaps three, further education colleges in Wales that are keen on such a possibility. We are not sure of the exact number—it may be one, two or three—but the vast majority are not clamouring for it. I appreciate the role that Fforwm plays in representing the views of the FE sector, but there is not an overwhelming clamour from FE colleges to provide such a power.

Mr. Hayes: There is no overall clamour from colleges in England either. No one expects there to be a plethora of colleges in the first wave that grant foundation degrees and, just as in England, it is likely that a small number of colleges in Wales would be willing and able to do so. The Minister uses the terms HE and FE as if they were interchangeable when he
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describes the enthusiasm to pursue this opportunity. I suspect that the views of the sectors might be rather different.

Huw Irranca-Davies: The hon. Gentleman might find that he is not correct in terms of HE and FE sectors in Wales because of the networking and collaborative approach that I have mentioned. I say this as a former lecturer at Swansea college, an FE institution, and at Swansea institute, an HE institution with its own degree-awarding powers under the University of Wales. There is extremely good collaboration, which is the pattern across most of Wales and the strategy that the Welsh Assembly Government have pursued. The hon. Gentleman pre-empts some of my later comments on what we do from here and on the independent inquiry. Fforwm has stated:

I have referred to the unique needs of Welsh institutions detailed in “Reaching Higher”. In response to the issue of the disproportionately large number of small higher education institutions in Wales, the SQW report emphasised the need for a dynamic and fluid system of interaction between providers, with shared missions and shared planning. Importantly, HE strategy in Wales has not yet focused strongly on foundation degree growth but has targeted under-represented groups through the “Reaching Wider” programme. “Reaching Wider” aims to increase higher education participation from groups and communities in Wales by raising aspirations and by creating new study opportunities and learning pathways to higher education. All higher and further education institutions in Wales are members of the “Reaching Wider” consortiums, along with local authorities, schools and the voluntary sector. Mention was made of the Welsh way, and this is certainly the Welsh way. Wales has been at the forefront in the UK in increasing participation from under-represented groups.

Mr. Paul Murphy: No one would disagree with anything that my hon. Friend is saying; the co-operation between higher and further education is superb and ought to continue. In most cases in Wales, that co-operation will provide the sort of higher education that we need. Why on earth would the denial of the principle of the right to foundation degrees in any way cut across what he has said?

Huw Irranca-Davies: I hope to be able to assuage some of my right hon. Friend’s concerns as I respond to a detailed debate in which good points have been made.

The hon. Member for South Holland and The Deepings, among others, referred to Privy Council powers and whether the Welsh Assembly Government had the power, in essence, to award foundation degrees. Fforwm queried whether foundation degree-awarding powers were a matter for Welsh Ministers, as the Welsh Assembly Government have not been devolved any powers with regard to the Privy Council. Yet clause 19
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amends section 76 of the Further and Higher Education Act 1992, which makes provision for degree-awarding powers for institutions in England and Wales.

There has not been a formal transfer of functions of section 76 to the Welsh Assembly Government, but the First Minister will advise the Privy Council on the exercise of its functions under that section. The First Minister advises the Privy Council by virtue of his role as a Privy Councillor and of the fact that HE and FE in Wales are devolved matters. Therefore, this is a matter for the Welsh Assembly Government, but the First Minister has a direct role as a Privy Councillor.

Let me illustrate how that would work in practice. If a higher education institution wished to secure degree-awarding powers, it would ask the Privy Council, which would ask the First Minister—a Privy Councillor himself—for advice. Taking advice from the First Minister, the Privy Council would then decide whether to grant the HEI degree-awarding powers. There is a direct link, and a mechanism does exist.

Mr. Hayes: In the light of the hon. Gentleman’s most recent remarks, will he deal with the point made by the right hon. Member for Torfaen (Mr. Murphy) about the involvement so far in these matters of the Secretary of State in his Privy Council capacity? I ask that because it seems to me that if that involvement had been profound we might not have had some of our recent difficulties.

Huw Irranca-Davies: I understand the hon. Gentleman’s question. I have tried to clarify several points about the Privy Councillor issue and to make it clear that a mechanism exists.

Mr. Murphy: My hon. Friend is now saying that, in terms of the matters under discussion, the Privy Councillor for Wales is now the First Minister for Wales. I have no objection to that, but I simply ask whether the situation has changed, because in my time the Secretary of State for Wales was the Privy Councillor for Wales.

Huw Irranca-Davies: I ask my right hon. Friend to give me some latitude by allowing me to return to that query later. I do not wish to make excuses, but I have only recently taken up my present post so my knowledge of the detailed chronology of these matters is limited. I hope that I might be touched by some inspiration and return to that point before I conclude my remarks.

Nick Ainger: I understand the Minister’s point about the Privy Council, but what about the process? If, following Sir Adrian Webb’s report, the Assembly decides that it wishes in principle to allow FE colleges to award foundation degrees, will the process be that an Order in Council will be requested from this place to give the power to the Assembly to do that, and that the power that the First Minister has as a Privy Councillor will also be used?

Huw Irranca-Davies: My hon. Friend is correct. We should not assume that the matter under discussion would preclude an Order in Council being brought
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forward at some point—and the mechanism involving the Privy Council, which we have mentioned, would then come into play in that process. It would be possible—with proper scrutiny from this place, I should add—for an Order in Council to be brought forward. My hon. Friend the Member for Aberavon (Dr. Francis), who chairs the Welsh Affairs Committee, has been closely involved in setting the procedure by which Orders in Council come forward, and I am sure that he will make sure that the scrutiny will be adequate at that stage.

Mr. Hayes: I understand that the hon. Gentleman is new to his post, but he is not answering the question that was asked. What the hon. Member for Carmarthen, West and South Pembrokeshire (Nick Ainger) wanted to know is not whether the matter under discussion could preclude an Order in Council, but whether an Order in Council would be a necessary prerequisite of the Assembly’s exercising its competence in respect of granting degree-awarding powers. We need to know that, because if we do not know it the Minister’s description of the process is of less value than it might be—I will not say that it is valueless.

Huw Irranca-Davies: I will seek to provide clarification on that point later.

However, I can now offer further clarification on the matter raised by my right hon. Friend the Member for Torfaen (Mr. Murphy). The Secretary of State for Wales retains their position as Privy Councillor on non-devolved issues—it is vital to put that on record—but the First Minister is Privy Councillor on devolved issues. Although not many people will have paid attention to the procedures in schedule 7 to the Government of Wales Act 2006—it was discussed yesterday in Committee—that delineate those roles, it is very important to understand the two different Privy Councillor roles.

3.15 pm

Dr. Hywel Francis (Aberavon) (Lab): I thank my hon. Friend for giving way and for drawing attention to the role of the Welsh Affairs Committee in this matter. In the light of this afternoon’s debate, will he assure us that he will convey directly, through the Secretary of State, obviously, to the Minister for Education and Lifelong Learning the nature of this debate and the strength of opinion throughout the House—the progressive consensus that was referred to earlier—in order to ensure that, if an Order in Council is forthcoming, it comes sooner, rather than later?

Huw Irranca-Davies: My hon. Friend makes a very good point, particularly regarding the progressive consensus. Yes, I can assure him that today’s deliberations will be conveyed strongly and clearly to the First Minister and to Welsh Assembly colleagues.

Mr. Touhig rose—

Huw Irranca-Davies: I will give way one more time, and then I will try to make some progress in dealing with the many points that have been raised.

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