Clause
4
Strategies
for functions of
Council
Sarah
Teather:
I beg to move amendment No. 17, in
clause 4, page 4, line 6, at
end insert ‘, including—
(i)
approved local area agreements (as defined in section 82(2) of the
Local Government and Public Involvement in Health Act 2007),
and
(ii) local improvement
targets (as defined in section 83 of that
Act);’.
The
Chairman:
With this it will be convenient to discuss the
following amendments: No. 18, in
clause 4, page 4, line 8, at
end insert ‘, including consultation
with—
‘(i) responsible local
authorities (as defined in section 78 of the Local Government and
Public Involvement in Health Act 2007),
and
(ii) partner authorities
(as defined in section 79 of that
Act).’.
No.
23, in
clause 4, page 4, line 8, at
end insert
‘, in
particular, to determine the level of demand for specific skills in the
economy’.
No. 24, in
clause 4, page 4, line 39, at
end insert
‘, in
particular, to determine the level of demand for specific skills in the
economy’.
Sarah
Teather:
With your permission, Mr. Atkinson, I
should like to make some general remarks about the clause before going
on to discuss amendments Nos. 17 and
18.
The
Chairman:
Order. I am happy as we move on to different
areas of the Bill to allow a wider-ranging debate on the first group of
amendments. However, that means that any move to have a clause stand
part debate will be looked at rather severely by the
Chair.
Sarah
Teather:
Thank you for that clarification. In principle,
we are very supportive of the clause. First, it establishes the skills
and employment board for London, which brings democratic accountability
to the organisation of training in London, and most critically, it
allows it to be integrated with other economic planning and provision
of services such as transport. That is particularly essential for a
place such as London. As a London MP, I was quite excited by that idea,
and felt that it offered a real opportunity to ensure that we take
account of London’s uniqueness. London generates a large
proportion of the country’s wealth, and draws in many of the
tourists who come to this country, but we also have significant levels
of unemployment and lower rates of employment than the rest of the
nation.
London is by
its nature a more transient place. There are waves of immigration and
pockets of poverty and wealth are found side by side. Many other cities
across the UK have those factors, but none in the same concentration as
London. London has unique training needs because of that, which are
heightened by the Olympics and the considerable building programme that
goes with that. We support that aspect of the
clause.
The second
important thing that the clause does is to allow flexibility for
sub-regional structures to be set up, and we support that idea in
principle. We have already had a discussion about sub-regional
structures and the need sometimes to take account of a city
organisation and the way in which employment is drawn into a city hub.
Amendments Nos. 17 and 18 are probing amendments designed to probe the
relationship between any new bodies that will be set up, given the
structures outlined in the clause, and local authorities. More
specifically, they are designed to probe local area
agreements.
I know
that the Minister referred to some of those aspects in the discussion
on clause 2, but I would like to push him a little further on this
point. When local authorities set up local area agreements, they are
designed to set targets for improvement between local authorities and
their partners, and Government as a whole. My concern about the wording
of the clause is that it appears to over-rule that, or appears to allow
the Secretary of State to over-rule that. I would be grateful if the
Minister could be clear about the relationship between existing
partnership arrangements and any new bodies that
might be set up. Obviously, it is essential that any new bodies take
account of existing plans and
partnerships, and I would like to ensure that there is consistency
between the Bill and the Local Government and Public Involvement in
Health Bill, which defines that relationship with local area
agreements. Local area
agreements bring together a whole range of services, and economic
development targets as well as skills and further education plans and
partnerships that are outlined in local area agreements. It is
essential that any new body works closely in collaboration with those
existing plans. They are probing amendments that are designed to get on
the record from the Minister exactly how that relationship will work
and to ensure that it is consistent with the other Bill that is
proceeding through Parliament at the
moment.
11.45
am
Mr.
Hayes:
I shall not add to what the hon. Member for Brent,
East said about her amendments, although I am sure that the Minister
will want to respond to her interesting and useful comments. I take her
point that they are probing amendments, designed to elicit
clarification.
On
amendments Nos. 23 and 24, section 24A of the 2000
Act allows the Secretary of State by order to specify a body to
formulate a strategy in relation to specified functions of the LSC for
the whole of England or part of it. However, it contains no provision
about consultation to determine demand, in line with the Leitch review.
In tabling the amendments we are anxious to insert the
term
“the level of demand
for specific skills in the
economy”.
Perhaps
I should remind the Committee that the Leitch review says
that
“analysis shows that
previous approaches to delivering skills have been too 'supply driven',
based on the Government planning supply to meet ineffectively
articulated employer demand. This approach has a poor track
record—it has not proved possible for employers and individuals
to collectively articulate their needs or for provision to be
effectively planned to meet them. Employers are confused by the
plethora of advisory, strategic and planning bodies they are asked to
input to. Under a planned system, the incentives are for providers to
continue doing what they have done in the past so long as that meets
the requirements of planning, rather than responding flexibly as demand
changes”.
Our
concern is that the system should provide what the economy needs. Like
Lord Leitch, we believe that a demand-led system, with employers in the
driving seat, does that best. I do not say for a moment that that does
not depend on there being a partnership between educators and
employers; of course it does. I said at the outset that I value
immensely the role that further education and other training providers
play in equipping our people with the skills that they need if they are
to make a worthwhile contribution, as well as those that add to their
well-being.
However,
in an advanced economy, in which need is dynamic, it is critical to
communicate demand as effectively as possible to trainers so that what
is provided through the system accurately reflects real economic need.
That is fairer to trainees and to employers, because all too often,
people who have been trained have to be retrained when they obtain
employment because the training with which they were provided was not
up to date. It is difficult to be
absolutely sure of achieving that, but it is most likely to be
guaranteed, as Leitch argues, by a demand-led system. Our purpose is to
assert that decisively, hence the wording of the amendment. Amendment No. 24 concerns the
function of the council in London when the LSC’s powers are
delegated. It would require the body established by the Mayor to
consult SSCs to determine the level of demand in London for particular
skills. It, too, is born of our determination to ensure that, in a
demand-led system, the needs of a particular locality are transmitted
as effectively as possible. We believe that the SSCs will play a
critical role in that regard. All SSCs are not equally strong; they are
evolving and there will be further changes in the way in which they
operate. However, they are the vehicle that should be used as a conduit
for the supply of information about demand and to ensure that what is
provided meets that demand. The amendments are designed to achieve that
outcome and I shall be interested, as ever, to hear the
Minister’s response to our helpful suggestions. They would
improve the Bill and bring it into line with the findings of the Leitch
review which, I can tell, will play a lively part in our
deliberations.
Bill
Rammell:
It is some time since I have contributed to a
wide-ranging debate on clause 4, but I am happy to be able to do so.
For the record, may I correct something that the hon. Member for South
Holland and The Deepings said when he summed up on the previous group
of amendments? He asserted that it is Sandy Leitch’s view that
the LSC will, over time, wither on the vine. That is not what Sandy
Leitch has said. He has explicitly said that he is not in favour of
ripping up structures for the sake of it and starting again, but that
he is of the view, as am I, that the LSC’s role and function,
and the way in which it operates, should continue to
evolve.
Amendments
Nos. 17, 18, 23 and 24 relate toclause 4 and the strategies
for the functions of the LSC. Amendments Nos. 17 and 18 apply to
directions and guidance about the consultation, and matters to which a
body specified to formulate a strategy for an area of England outside
Greater London is to have regard when formulating or reviewing its
strategy. Similar amendments were tabled at Committee stage in another
place. We considered the points that were raised, and have made a
number of changes to the draft directions and guidance in relation to
the formulation and review of the skills strategy for London by the
London skills and employment board. Similar directions and guidance
will apply to other bodies outside London. I am, therefore, pleased to
be able to restate the reassurances given by my noble Friend Lord
Adonis.
I agree that
provision should be made in directions and guidance, but I do not
believe that specific reference to these matters should appear in the
Bill. While I agree that a range of bodies should be consulted, I
cannot see a case for favouring particular categories of consultee by
naming them in the Bill. If we were to go down that path, we would
burden the Bill with unnecessary detail, and to name only some would be
misleading and unhelpful. Those drawing up and reviewing strategies
will want to have regard to existing local area agreements and local
improvement
strategies, as the hon. Member for Brent, East has asserted, and also to
other relevant matters such as sector skills agreements. Again, I
believe that the place for such matters is in directions and guidance,
not in specific mention of them in the Bill. Taking London as the first
example, a list of bodies to be consulted and matters
to which the board is to have regard is provided in the draft published
directions and guidance. Those draft directions say, as the result of a
debate on amendments tabled in another place, that the board must
consult responsible local authorities where the authority falls partly
or wholly in Greater London, and partner authorities where the board
considers it appropriate. Directions also require the London skills and
employment board to have regard to local area agreements and local
improvement targets specified within them, which have been prepared by
any responsible local authority where the area of the authority falls
partly or wholly in Greater London.
I refer the hon. Lady to the
documents about the Bill that we circulated to the Committee,
particularly item (c), draft regulations on the strategy-making body
for London, made under clause 4. Section 7 explicitly mentions the
board’s having to consult particular bodies, including
responsible local authorities, as defined in section 78 of the Local
Government and Public Involvement in Health Act 2007, where the area of
the authority falls partly or wholly within Greater London, and each of
their partner authorities within the meaning of section 79 of the Local
Government and Public Involvement in Health Act 2007 where the board
considers it desirable to do so. I hope that that provides the
reassurance that the hon. Lady seeks and that she and the hon. Member
for Leeds, North-West will feel able to withdraw their
amendment.
Amendments
Nos. 23 and 24 would provide that, where directions
and guidance about consultation are given by the Secretary of State,
the particular need to consult to determine demand for specific skills
in the economy should be considered. I agree that the level of demand
for skills in the economy is an exceedingly important issue as we
formulate or review our strategy, but I do not see a reason to refer to
it specifically, when we do not refer to other matters of equal
importance, such as improving employment and tackling
worklessness.
The
demand for specific skills, along with many other relevant matters,
will be taken into account in our strategy. It would not be appropriate
to refer to just one matter in the Bill, and to include all relevant
matters would over-burden the Bill with too much unnecessary detail.
For those reasons, I ask the hon. Member for South Holland and The
Deepings not to press his
amendment.
The
Chairman:
Order. The hon. Member for Brent, East will need
to withdraw her amendments at the end of the debate, but if the hon.
Member for South Holland and The Deepings wants to speak, now would be
the time for him to do
so.
Mr.
Hayes:
Thank you for your indulgence and advice,
Mr. Atkinson. We need to be absolutely clear. The Leitch
review is explicit in its advocacy of a demand-led system, which I
think the Minister has fully acknowledged. The report is unequivocal
about the changes that would be needed to achieve such a
system. The Learning and Skills Council is not mentioned in any
significant way until page 73, and then in not particularly glowing
terms. In describing the move from a supply-driven to a demand-driven
system, Lord Leitch
says:
“The LSC
allocates funding on the basis of expected demand. If demand does not
meet expectations, funding for subsequent years is adjusted. This can
mean that colleges aim to ‘recruit’ employers and
individuals into planned courses to fill places, rather than responding
flexibly to
demand.”
The
assumption underpinning the report was that the current system does not
always deliver, which is reflected in our skills performance. The
Ministers on the Committee have been straightforward about that in the
past. We need to improve our performance radically, particularly in
intermediate and higher level skills, where we lag behind France,
Germany, the USA and other competitors.
The purpose of our amendments
is to enshrine in the Bill the principle of responsiveness to demand.
There is no difference of principle between us in that respect, but the
Minister has made the case that the amendments would entangle the Bill
in a level of detail that would not be appropriate from a legislative
perspective. I hear what he says, but I use this opportunity to probe
and to reinforce my absolute determination to ensure that the principle
behind the Leitch report, of moving from a supply-driven to a
demand-driven system, should inform all that we do in the Committee, as
well as future public policy. Having heard the Minister’s
assurances, I beg to ask leave to withdraw the
amendment.
The
Chairman:
Order. The hon. Gentleman does not need to
withdraw the amendments, because they have not been
moved.
Mr.
Hayes:
I take your advice, Mr.
Atkinson.
Sarah
Teather:
I thank the Minister for his helpful response to
our amendments. As he assures me that the requirement to consult with
local area agreements will be written into guidance for all areas, not
just for London, I am happy to beg to ask leave to withdraw the
amendment.
Amendment,
by leave,
withdrawn.
Clause
4 ordered to stand part of the
Bill.
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