UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 850 iv

HOUSE OF COMMONS

ORAL EVIDENCE

TAKEN BEFORE THE

EDUCATION COMMITTEE

16-19 PARTICIPATION IN EDUCATION AND TRAINING

WEDNESDAY 8 JUNE 2011

ANNE-MARIE CARRIE, JOHN HAYES MP, LORD HILL OF OAREFORD CBE, PETER LAUENER, SEYI OBAKIN, BOB REITEMEIER and DR THOMAS SPIELHOFER

Evidence heard in Public

Questions 235 - 332

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Oral Evidence

Taken before the Education Committee

on Wednesday 8 June 2011

Members present:

Mr Graham Stuart (Chair)

Neil Carmichael

Nic Dakin

Bill Esterson

Pat Glass

Charlotte Leslie

Ian Mearns

Tessa Munt

Lisa Nandy

Examination of Witnesses

Witnesses: Anne-Marie Carrie, Chief Executive, Barnardo’s, Seyi Obakin, Chief Executive, Centrepoint, Bob Reitemeier, Chief Executive, The Children’s Society, and Dr Thomas Spielhofer, Senior Researcher and Consultant, Tavistock Institute of Human Relations, gave evidence.

Q235 Chair: Good morning and welcome to this session of the Select Committee on Education looking into participation by 16 to 19-year-olds in education and training. We tend to do things fairly informally, so if you are comfortable with us using your first names, we will do so. The Committee conducts inquiries, takes oral and written evidence and then makes a report to Government, to which they are obliged to respond to Parliament, through us. If there are any recommendations you would particularly like to see in our report to Government, please make them clear to us in your testimony today. We do not have very long. I know members of my Committee will keep their questions short and pithy. If you could do that with answers as well, that would be fantastic.

The number of 16 to 18-year-olds who are so-called NEET-not in education, employment or training-increased by more than 30% between 1999 and 2009. Do you have any particular thoughts as to why that was, and what do we need to understand in order better to address participation by young people in that age group? Who would like to start? Bob?

Bob Reitemeier: I’ll jump in. Thank you very much. In relation to that percentage increase, one of the things we would encourage the Committee to do is look at particular disadvantaged groups within it. Our concern really lies with disabled children, children with special educational needs and refugee and migrant populations. Part of the reason why they, unfortunately, are in the NEET category is that the support services surrounding them that are necessary to help facilitate their transition to higher education, apprenticeships or work placements are greater than is necessary for other children. If there isn’t that additional support, we see a lack of success in that area.

Q236 Chair: Right. What about the labour market? Has that played a significant role, Thomas?

Dr Spielhofer: You’ve put me on the spot there. I was going to talk about something else.

Chair: You answer as you see fit. Don’t be led by me.

Dr Spielhofer: One of the things that we have looked at is the fact that the increases and decreases have been different for different age groups. One of the things you will see-I am sure you know the numbers-is that for 16-year-olds, the numbers have decreased significantly. That has been balanced out predominantly at the 18-year level. There are various hypotheses to explain that. One is that, generally, these things are related to the opportunities available once young people complete their education and training, but they are also related to what young people who engage at 16 actually do.

This is a well-rehearsed debate, and it relates to the Wolf review about what young people actually do when they engage-it is definitely an issue. One of the aims was to replace E2E with foundation learning. In my previous role in NFER, we did an evaluation of foundation learning. One of the criticisms of E2E was that it was like a holding cell, and people did not actually go on to anything positive. The aim with foundation learning was to introduce more progression, so that young people would do something that would lead on to something. The recent impact evaluation that we did on behalf of the Department for Education showed that there was some positive impact and some evidence that foundation learning did lead to positive outcomes and progression. The Wolf review suggested that one of the disadvantages of foundation learning was that it did not lead to employment, but I do not think that was really the intention of foundation learning. Foundation learning is at such a low level that you would not expect it to lead into employment, but you would hope that it would lead on to further learning.

Seyi Obakin: I was going to add that, before you get to thinking about the impact in terms of the labour market, you first need, for the disadvantaged groups that Bob was talking about earlier, to think about where their lives are, because they are that much further back from the labour market. If you take the sorts of young people who will come to Centrepoint, for example, they will have very chaotic lifestyles, so you need to sort that out first of all. They would have very poor basic education-literacy, numeracy and those sorts of things. About a quarter of our young people have that, so they are that far back from the labour market.

The point about flexibility of provision is a problem, too. We were talking earlier on about people not having a second chance. The fact of the matter is that that is quite true, and it is a serious problem for young people who are over 16-the sort who end up at Centrepoint, for example. What you need is some way of creating the flexibility for them to get back into attaining basic literacy and numeracy. Then, you can move them nearer the labour market. We have done some work around that theme, which we can share with the Committee.

Q237 Chair: I am just trying to work out why you use that particular statistic. What deteriorated? Obviously, I am particularly interested in the most vulnerable young people, but why was there an increase in the numbers? These problems-with flexibility and homeless people moving and struggling to maintain their education-did not change between 1999 and 2009, but the number of 18-year-olds, in particular, increased.

Anne-Marie Carrie: But, Chair, the provision was not suitably differentiated, so we did not have multiple start and finish dates. There were not individual learning programmes. For example, a young person in a young offenders institution is told 24 hours before they are due to be released which bed and breakfast they are going into. There is no real chance for them to plan for a college course. When they are released 24 hours later, they cannot start a college course until the next semester-into the spring or whatever. There is no flexibility in start and end dates, in terms of when young people can enter individualised programmes. The flexibility of provision-differentiated provision-is one issue.

We have not necessarily addressed pre-entry barriers-the fact that children often cannot even have a shower or get transport to education and employment. The other barrier is children who have disengaged from education, and the question is how we get their confidence back so that they can participate. We are working with 2,500 children, and some of our statistics show that 80% of them go on into further and higher education and into employment, because we can put a flexible package and support around them.

Q238 Pat Glass: What do you see as the balance between motivation and barriers to participation? What is the role of incentives in that?

Dr Spielhofer: Can you explain exactly what you mean?

Pat Glass: Some of the young people I have worked with and have known over the years have massive, complex barriers to learning, and I am not talking about learning difficulties. They need massive incentives, and compulsion alone is not the issue. Where does the balance lie for most young people?

Dr Spielhofer: In terms of motivation, our research has shown that generally, when you ask young people in almost any group-we have done a lot of research with disaffected young people and young people in the lower achievement groups-how important it is to achieve qualifications and get an education more generally, the vast majority see value in it and want to achieve. They want the things that everyone else wants. When we did our now famous barriers to participation study, I think 94% of all the young people surveyed said that they saw the value of education and training-I don’t remember the exact phrasing-in getting on in life. Of course, that leaves 6% who do not, and they will be a lot of the young people with whom my colleagues here deal.

The question then needs to be: since 94% see the value in education and training, why isn’t participation as high as that? That is where the particular barriers and constraints that young people face that prevent them from participating come in, and there are various things, such as personal issues. There are 6% who do not want to participate, and that will often be related to their experience of school. They will have been put off by education and training, so they just do not want anything to do with anything that they associate with their previous experience of it. I guess that the strategy there is about preventing that from happening when they get to 16. There are other things about flexibility, which my colleagues were talking about.

When we researched raising the participation age in, I think, 2009, the press was quite negative. Studies were published that said that young people were against it. We interviewed 120 young people and asked them what they thought about raising the participation age. There were some who were negative, but there were quite a few who were positive about it, and they were young people who were NEET, who were in jobs without training or who had previously been in those positions. Their interpretation was that the advantage of raising the participation age would be that it would force providers to deliver the kind of provision that would suit those young people’s needs. It would not be that young people needed to adapt to what was already there, but that providers would be forced to provide the kind of provision that suited those young people. I thought that that was an interesting angle. I think that what they were talking about is, as the Committee said here, flexibility of start dates and the kind of provision that really engages them.

Pretty much all the research I have done is with disaffected and disengaged young people, and a lot of them say that they want the kind of provision that is relevant to them-often work-related and employer-based. They are often denied that provision because of their low educational achievements. When you ask young people at the decision point at 16 what they would like to do, a lot of them say the traditional stereotypical thing, which is, "I want to do an apprenticeship", but often that is denied to them because of their low educational attainment, and also because that provision is not available for them. The employer apprenticeships are often just not available.

Anne-Marie Carrie: I wanted to comment on three types of provision that I think address both the barriers and motivation. We have some projects that work with what I would call soft skills, and I do not think that sixth-form or FE colleges have the capacity to deal with some of those soft skills-punctuality, attendance and how you get yourself motivated to get up in the morning. We have volunteers who pick up children and take them to further education-and then they fly. Sixth-form and FE colleges are not prepared for those barriers and that soft skill work, and there needs to be something about how we get the soft skills to support young people.

The second area is vocational training. We run Dr B’s, which is a training restaurant in Harrogate for children with both learning difficulties and behavioural difficulties. We have children turning up at 8 o’clock in the morning who have never turned up at any time for school. It is worked-based training for getting skills in restaurants; then they move on into the restaurant trade. A high percentage-70%-of those children go on to secure good employment.

That is vocational training. There are also soft skills, and there is another area: Barnardo’s Works, an award-winning scheme operating in Scotland with Scottish Power. I know that is probably not a very good name to use this morning. However, Scottish Power has developed a work-based employee scheme that we are now running out across England, Ireland and Wales. There is an 80% take-up into employment from that scheme. There are volunteers pooling cars to pick up kids to take them to that work-based learning. So there are three things: soft skills, vocational training and work-based learning. All three of those can transform some of our more vulnerable children into what we were discussing earlier. You need to recognise the social, human and financial cost of not getting these children into employment and training.

Seyi Obakin: I do not think motivation is a real problem; it is an apparent problem. When you scratch beneath the surface, all the young people we work with want to do well. They want to attend; they know that if they have qualifications they will do better in life. They could come across as not motivated because of the barriers they faced before-because they were falling out of a regular school system, because they got into trouble with teachers.

About a year or so ago we started to think about an idea that we call college without walls. We simply said, "What if you got a personalised learning opportunity that starts with where you are, that doesn’t fit with the constraints of an academic year, and that means that you can take short and modular courses that are accredited? You are allowed to enrol and, if you drop out, that doesn’t mean that your enrolment stops. When you are ready you can come back again and pick up from where you were. It is not bound by time in that sort of way, and it is passportable." Every single young person said yes, that would work for them. There is something in there about how you make provision a lot more flexible for those who have fallen out, in order to get them back into participating.

Q239 Chair: Can you flesh that out at all? We often have aspiration. What we have to struggle towards is a policy recommendation that Government or local authorities can implement that will make it more likely.

Seyi Obakin: We were thinking at that time about putting together a combination of online learning with being in school with a learning mentor, who might be a volunteer, who helps the young person to ensure that they don’t drop out. I think that is possible, in a policy context, to implement.

Bob Reitemeier: One of the benefits of having a panel is that there can be slightly different perspectives on the same question. On motivation, I think you are right to talk about when young people are self-motivated, and when they really do have that desire. The issue is that a large percentage of those who are NEET or not engaged do not have self-motivation. The reason is that they are not being motivated. People’s expectations of their future and possibilities are extremely low.

When pointing to recommendations, there is an issue around the workplace and work force and how we help schools, workplaces and the apprentice environment to have higher expectations and ambition for these young people. We know in human relationships that we all react to how people perceive us-how people think about us and our potential. There are a lot of young people, unfortunately, on whom the adult world is looking down, saying they have no potential. That really needs to be addressed for those who are not self-motivated. In terms of recommendations, work force training is a critical area.

Q240 Pat Glass: Can I ask about transport in particular and how much of a barrier to participation that is? I come from a large rural county that has just abolished all 16-plus transport. I see that as one of the biggest barriers. How much of a barrier is that?

Chair: Short, sharp answers, please.

Dr Spielhofer: I agree. The interesting study that got all the press about the EMA essentially focused on transport-the EMA was just a subtext-and it showed statistically that transport was more likely to be a barrier in rural areas than in other areas. So I strongly agree. Transport is definitely an issue. We have just done another study looking at three local authorities and aspirations, and again transport came up as an issue.

Anne-Marie Carrie: Transport is certainly an issue for many of our young children. We are lucky that we have been able to dip into a pool of volunteers. I know of one child who has a team of 14 volunteers who take her to a workplace placement in a hotel for 4 o’clock in the morning, and they have been doing that for three months in rural Cornwall.

Bob Reitemeier: I agree with the point about transport. There are two things about transport. One is that when it is covered-included into a package of support-it is often transport just from home to a course or from home to an activity. For a lot of disabled children, but also for disadvantaged children, it is not getting just from A to B; it is all the transport in between, which is about enjoying life, being part of activities and getting out-the friendship aspect of it. We push that aside as the soft side, as Anne-Marie mentioned earlier. It is actually hugely important for a child’s development. We often limit transport to getting just from A to B, and transport has to be looked at in a much wider context.

Dr Spielhofer: Can I just jump in? I know that I have made my point, but can I make another little one? I want to relate to something that was said earlier by Bob. With some of the young people who don’t participate, it is not necessarily an issue about motivation or self-motivation; in many cases, the issue is about resilience. Transport overlaps there. Often the issue with young people who do not participate is that they have very low resilience, so if anything is a small barrier or if anything goes wrong they drop out or do not even start to participate. Transport then becomes an issue.

If somebody who is very motivated comes from a background that is well supported, transport is a constraint but they overcome it. But if they come from a background where they are not supported or there are more problems-if they have issues about education-they can use transport to some extent as an excuse or it just becomes a barrier. I have had a number of interviews with people who have said, "I started college, I realised it took me too long to get there, I dropped out." That is where transport becomes a barrier.

Seyi Obakin: Transport is an issue. For a typical young person who is, say, on income support, the income for the week is £51.85. Young people are telling us that if you live in London, transport for a week is probably £20 of the £51-it is very substantial-so it is a problem.

Q241 Charlotte Leslie: Thank you very much for coming along. I want to start with an observation that will lead to a question. Using as an example the independent travel training schemes, I know that the NFER has done some work that shows that only about 17% of those aged 16 or 17 with learning difficulties or disabilities take them up. In a sense, it struck me that that should not be surprising, because the very thing that makes it difficult for young people to work out timetables, and to work out what travel is available to them and how to use it, is exactly the same thing that is going to make it difficult for them to work out what help schemes are available to them.

My first question is: to what extent is the challenge facing our helping the most disadvantaged children and young people with learning difficulties or disabilities into the right kind of opportunities an access problem, in which even the information that is provided is difficult for them to access and unpack, which is a double whammy? To what extent is it that suitable opportunities do not exist? So, to what extent is it access, in a sophisticated way, and to what extent is it opportunities?

Bob Reitemeier: It is similar to the previous question about motivation and barriers: it is both. There is still a big issue despite all the legislation, and there has been loads of legislation about how to improve accessibility-helping children with special educational needs and disabilities to have proper access to forums and to understand the process. It is about the realisation that the child, and even the child with the family, needs further support-that independent person, either an advocate or tutor, who can explain at the pace of the child and the family what is available and how to access it. Access is still a major issue. It is more about implementing what is actually already available, but not being applied universally.

As for opportunities, you asked about the labour market. If we do not recognise children’s special educational needs and that disabled children and some refugee and migrant children have extra needs than those under a universal package, they will not get such opportunities. The process is a slower process; it requires more intensive one-on-one support and somebody who is acting on behalf of the child. We must recognise that it is a resource issue and, if we do not put it in place, the opportunities will not be successful.

Q242 Charlotte Leslie: More specifically, looking at things such as pre-apprenticeships and earlier vocational work-based learning, is the demise of the pre-apprenticeship model causing difficulties for most disadvantaged young people? Is it having an effect? What is your view?

Anne-Marie Carrie: There is something about pre-entry and pre-entry support. Whether that is part of a pre-apprenticeship model or foundation courses, there is something about pre-entry being ready to take up to the next stage. That is certainly true.

Seyi Obakin: We are delighted that it will create a lot more apprenticeship opportunities. We say that there will be 50,000, but we are quite worried that disadvantaged young people who are further away from the market will not benefit from that unless we have the pre-apprentice schemes that deal with those sorts of issues.

Q243 Charlotte Leslie: In the headline figure of so many apprenticeships being created and offered, do you have any thoughts or concerns about the quality of each apprenticeship?

Bob Reitemeier: The labour market has changed over a decade. Currently, even though the financing is available for apprenticeships, the apprenticeships are not being filled because employers are finding it difficult either because of the economy and their own financial situation or because they can choose between a 22-year-old graduate and a 16-year-old disadvantaged youth for the same post, and the common-sense choice for them is the 22-year-old graduate.

There is a general principle in respect of disabled children, especially those with educational needs. With that particular group of children, it may be helpful to look on pre-apprenticeship and apprenticeships as a transition into adulthood as opposed to a transition into education, training or employment. For the transition to work successfully, it will take the children well into their adulthood. We should look at it as a pathway in that regard, as opposed to a limited time offering.

Dr Spielhofer: One of the things you should probably look at is the valuation that we did of foundation learning, which is just about to be published. It found that the foundation learning programme has the most positive effect on young people with special educational needs and learning difficulties. There are various hypotheses why that is the case. It is a type of pre-apprenticeship.

Q244 Charlotte Leslie: Not to pre-empt your thoughts, but do you have any recommendations in that regard to put to the Committee?

Dr Spielhofer: I’ll think about that.

Q245 Tessa Munt: I would like to concentrate a little on the National Foundation for Educational Research study in which you were particularly involved. I have a note saying that you surveyed 2,029 young people. How many of those were rural, how many were in suburban areas and how many were in urban areas?

Dr Spielhofer: I don’t have the figures in front of me. It is worth saying that I am not a statistician. I was leading the research. Statisticians who did the study would be able to give a more precise answer. The study was criticised very widely in terms of the EMA not being representative. The 2,029 young people were the main sample size, and the EMA was a sub-group within that. They were sampled to be representative; we went to six different local authority areas and we sampled on the basis of the CCIS data. I always forget what it stands for.

Q246 Tessa Munt: I can see that there is a balance of gender, attainment, incidence of learning disabilities and difficulties, and destination. I am particularly interested in the geographical areas. What were the six local authorities?

Dr Spielhofer: They were not named in the report. You would have to check with DFE. That is part of the policy of the research that we don’t name the six areas. The DFE would know what the six areas are and you could check with it. Again, we sampled. We did not just go to six rural areas or six urban areas. We chose different types of areas and we had a ruralicity factor within that. I really don’t think that that would be an explanatory factor.

Q247 Tessa Munt: I would like to put it to you that it might be. You have spoken to children in schools. Am I correct?

Dr Spielhofer: No. The research has been misrepresented in many ways. People have said that this was only based on children in schools. It was not. It was based on school leavers. It was based on 16 and 17-year-olds who had either just left education or had left a year ago.

Q248 Tessa Munt: But they had only had experience of school? Am I correct?

Dr Spielhofer: No.

Q249 Tessa Munt: How many had gone to further education colleges?

Dr Spielhofer: We did not specifically ask what they were doing. They were people who had left year 11 either that October so had not yet started and ones that had left earlier. It was basically a sample from the CCIS that was not based on the type of provider they were with. It included something like 32% who were doing a below level 2 qualification, so it was not just students doing A-levels.

Q250 Tessa Munt: All right. You talked to young people who were year 10 and year 11.

Dr Spielhofer: It was not year 10 and year 11.

Q251 Tessa Munt: Sorry. I beg your pardon-had done year 10 and 11. You say that they were 16 and 17-year-olds.

Dr Spielhofer: We were talking to young people who had either just completed year 11, so were just making the transition or did the transition a year ago. So it is basically young people who have either done one year of post-16 education or are just moving into post-16 education.

Q252 Tessa Munt: Okay. I would like to know how many of those young people were in further education college. I will take my example as a scenario. If you are a young person in Somerset and you are looking at what your opportunities are, there is almost no transport system. I have one station to the far west of my constituency. No trains. The bus service is appalling. If you want to buy a car you buy a banger but it still costs £3,000 to insure and tax it. You can’t fill it with fuel because it is so expensive. So what you think are your opportunities are fantastically limited. If you ask a young person, "How are you going to go to college?" they are not going to be able to tell you what the answer is because it is so far out of their reach that they are not even going to consider that. They are not going to raise the question of transport half the time because money is always the answer.

Chair: Question please, Tessa.

Tessa Munt: So I would really be interested in knowing exactly what those samples were. I think if you are in a rural area your expectation is nothing. No cash will solve that. What I am particularly concerned about is that we have Government policy around EMA which has been wholly based on a 12% figure, who will apparently have their problem solved by having money. We’ve got this thing where only 12% of EMA recipients-

Chair: Tessa, I must insist on a question please. I want to hear from the witnesses.

Tessa Munt: Okay, so are the Government justified in basing their policy on that 12% of students to whom EMA would make a difference?

Dr Spielhofer: That is a very direct question. It is a sort of yes and no and I don’t want to give a yes and no answer in that sense. One of the things that I want to emphasise about the study is that first of all it was not about EMA. It was about barriers to participation of the population as a whole. We were not asked to sample just rural kids. That was not the aim of the study. We had one question in the study that was about EMA and a sub-question related to that. The question was-and it was basically young people who were in education and training-whether they were getting EMA. Of the 2,029, 838 said they were getting EMA. Then we asked, "If you had not received it, would you have done the training anyway?" and 88% said yes and 12% said no.

Now, you can interpret that in different ways. You can interpret that 12% quite negatively, and say that for 88% that was wasted money, but I don’t actually see it that way. I think it has been misinterpreted, in that sense. The 12%, I think, is quite worrying-the 12% saying they would not have done it. I think that is quite a worrying statistic. The 88% can be interpreted in different ways. It will include some young people for whom it probably didn’t make any difference whatsoever, but it also probably includes young people for whom finance is a constraint. Actually in some sense it shows resilience; it shows that they are so committed to their education and training that finance would not have stopped them from doing that, but the percentage of that we don’t know, because that was not the focus of the study. We did not provide enough supplementary questions on that, so we don’t know. I think to say, "It’s only 12% for whom this is an issue, and for all the others it isn’t an issue-therefore it’s wasted," is misinterpreting the facts.

Q253 Tessa Munt: It is a bit of a shame, isn’t it, that the whole Government policy around funding young people is based on something that might possibly have been misinterpreted. I accept that you made notes about the fact that they are not the only barriers, and stuff like that, but I think that, particularly in rural areas, young people tend to go into catchment.

Dr Spielhofer: I’ll give you a sort of alternative thing. Look at, for example, free travel for over-65s. If you asked over-65s a question-"You receive free travel; would you travel even if you didn’t receive that free travel?"-do you think 100% would say, "No, I would never get on a bus?" No, so do you abolish free bus travel for over 65s?

Chair: Good idea.

Dr Spielhofer: I’ll probably be credited with this as well.

Q254 Nic Dakin: Just to follow that up, are you happy with the concept that’s been put forward that EMAs are therefore a dead weight-this 88%?

Dr Spielhofer: No. First of all, there have been other studies as well, by the IFS, that actually focused on EMA. We did not ask, because it wasn’t the focus, "How much EMA are you receiving?" so some of our 88% may only have been receiving £10. Do you really expect that that would be a deal-breaker for these young people-that all young people would say, "Because of £10 I’m not going to do any education or training?"

Q255 Chair: Anne-Marie, do you want to come in?

Anne-Marie Carrie: I want to say that some of our 2,500 service users are the most vulnerable children in the country, and actually EMA has been a bit of a deal-breaker for them. For our service users-I’m not saying for the population, but for our service users, who are vulnerable people-the EMA is, our research would show, a big deal.

I have to put on record, because I want you to know Barnardo’s position, that we are utterly in opposition to the discretionary support fund, and to moving that fund to providers-that is a proposal in the legislation-so that it will be colleges and sixth-form colleges who decide who gets the support fund, and at what level. I consider that unfair. It is inefficient, and it will stigmatise some young people who don’t want to say, "Well, actually, I was in a young offenders institution and I need a bit of extra support because of x, y and z." You ask for specific recommendations; you ask what we want to say. I think there are huge flaws in giving the discretionary learner support fund to providers to disburse to children and young people.

Q256 Ian Mearns: This is so important. We have a significant Government policy on education maintenance allowance. Thomas, you are saying that the study that you did was about barriers to learning. Quite clearly, I am getting the impression that you are not happy that such a significant shift in Government policy has been based on research that you carried out. I doubt that you ever thought that the outcome would be the abolition of EMA.

Dr Spielhofer: That is completely correct, yes, and it was done without any discussion with us as well. It was just announced that it had been abolished as a result of NFER research and the 88% figure.

Q257 Ian Mearns: I have put questions to Ministers about the number of young people receiving EMA at the higher level, and we have got a figure of 567,000 youngsters in Britain getting EMA at £30 a week. In north-east England, it is 36,000 youngsters, and in Gateshead, which I represent, it is almost 3,000 youngsters. This policy will obviously have different impacts in different parts of the country.

Dr Spielhofer: That is another thing that has been ignored from the studies. That is the headline figure. I completely agree that for particular sub-groups with particular needs, that was a barrier. A very high proportion of teenage parents, for example, said that if they hadn’t received EMA, they would not have continued. Among those who had not continued-those in jobs without training, or those who were NEET-there was a question about whether they would have considered participating if they had received more money for transport and so on. I think a third said yes, which is a very high proportion. There are other barriers as well; it is not the only one, and our research showed that. As we know, you can’t just say, "Throw money at them and they will all participate," but it is a significant issue.

Seyi Obakin: I was just going to say that you can’t say, "Throw money at them and they will all participate," but our experience from the young people we work with is that EMA is a deal-breaker if they don’t get it. I invite anyone at all on the Committee to come and talk to the young people who live in Centrepoint who are disadvantaged. They will tell you that it is a point for dropping out.

Bob Reitemeier: To support the panel, we at the Children’s Society had the same concerns that all the panel members have expressed about the discretionary element of what is being proposed. It is worth reminding ourselves that the vast majority of children who received EMA were in families that earned £21,000 or less.

Q258 Lisa Nandy: I want to ask you about the new bursary scheme that replaces the EMA. The Government have confirmed that people on income support, people in care and care leavers will be automatically entitled to it, but are there other groups of disadvantaged young people that you are concerned about, which this bursary scheme may not reach?

Anne-Marie Carrie: It’s quite interesting, because the applicability of the bursary scheme will be different in different settings. I will need to get the figures correct on this, but if you were in work-based learning, the scheme, which is £800, would give you only £15, or whatever it is, a week. If you were on an academic course, it would go up to £21.50 or something. I will give you the exact figures, but it is quite different. The sum of money remains the same whether you are in a year’s work-based learning or on an academic course, so there is an issue there.

We think there is also an issue for some children, such as teenage mums and children who are carers, as well as children who are care leavers and children who have problems with mental health and substance misuse. They do not seem to be part of this discretionary bursary. Also, it is quite silent on the detail of at what stage people will know, and where the transferability is. Seyi and I were discussing this; some of our children will move inevitably, because they get moved in care homes or wherever. If the money is with the provider and not with the young person, when that breaks down, they will have no money for some period of time until the system catches up with the fact that they have moved and they are in a different foster home, or they are in a different bed and breakfast.

Seyi Obakin: A further concern about that is that if the schools are administrators, we do not know that they will necessarily take account of the chaos in the life of these particularly disadvantaged young people. If we stick with that, it is really crucial that we have a responsible adult who is able to mitigate that, so that penalties that actually put those young people back are not applied unjustly and too quickly. It is a bit about replicating the estrangement rules in the current EMA legislation.

Bob Reitemeier: We were particularly focused on disabled children, children with special educational needs and the refugee population, some of whom are included in the care system. As a general group, we would include those as a special target for the bursaries.

Dr Spielhofer: One of the real strengths of EMA was the universal awareness of it and the way that the rules worked. A big concern about a discretionary fund is that because it is discretionary, some people do not know about it and might not even consider education and training, because they will think, "Well, I’m not going to be eligible anyway." Again, it comes back to the dead-weight thing. The big strength with EMA was that people were aware of it and saw it as a way of continuing.

Q259 Lisa Nandy: We also heard evidence in this inquiry from witnesses who were concerned that stigma would be associated with having to go forward and ask for the fund, because we are moving from an entitlement to a discretionary system. Do you share those concerns?

Anne-Marie Carrie: Absolutely. That could have huge unintended consequences. The fund is supposed to get the children who are most vulnerable into education and employment training, but they might have to give someone very personal information to qualify for it. The only other issue that has not been raised is whether there will be an incentive or a disincentive for pre-excluding some children. We are now saying that schools, sixth-form colleges and further education will be responsible for exclusions, so during the admission process, might there be a weeding-out of some children who might need further support in sixth forms and colleges? We have not explored using admission processes to pre-exclude vulnerable children from the system.

Bob Reitemeier: The word "culture" comes into play here. The culture in schools and colleges might not be of trying to raise children’s ambitions and encourage them. As we mentioned, children might not have the self-motivation or the resilience to put themselves forward for the bursaries, so it is almost illogical. It really is a big issue, and that comes back to work force training, too.

Q260 Lisa Nandy: We have heard evidence from a lot of young people directly about what the EMA has meant to them. Some of them have told us that the allowance is now an essential part of their household income. Do you have any concerns about the fact that under the new system, they will not necessarily know what they are going to get when they are deciding whether to go on to college?

Dr Spielhofer: That is what I was saying. A key thing was that people got some EMA and could budget it in, but with the discretionary fund they will have to wait and see. It is very much up to providers, as we discussed. The onus will be on providers and schools to make sure that young people are aware of the fund and that a decision is made early on, so that people can budget.

The problem is that the most vulnerable will be the hardest hit. They will probably not even go there. They will just say, "It’s not for me; I’m going to look for a job." In our study, a very high proportion of young people in jobs without training said that finance was a key concern, as you can imagine. Why did they go into jobs without training? Many of them said that they could not participate, or that they needed money to pay rent to their parents and so on, which was a key financial barrier.

Q261 Charlotte Leslie: Just a quick question: did you consider that every single penny under the EMA system was 100% efficiently spent or delivered? If the nation’s ability to pay for the overall budget of EMA was always constrained, how would you ration it down to ensure a targeted effect? How would you reduce an overall EMA budget, and has there been any waste?

Bob Reitemeier: Is 100% of any budget efficiently spent? The only answer to that is: "Of course not; no budget is 100% efficiently spent." The point is that the scheme is going from £550 million to £180 million. Is that representative of the inefficiency of EMA? No, it is not, so it should be a higher amount. If you compare that to the 30% increase in NEETs, it is a much more drastic cut. Once you take away the automatic recipients-children who are in care or in transition, or who are on income support-the allocation to a local authority will be equivalent to £800 for 15% of the 16 to 19-year-old population. That is a much lower percentage of children who need support than I would argue is necessary.

Anne-Marie Carrie: I can only speak on behalf of our service users who have EMA. They do not save it up for holidays. They use it to get dinners, to get transport, to get equipment, and to get themselves washed and clean so that they can turn up on time for their college course.

Q262 Charlotte Leslie: What I’m asking is this: the Government have had to make a difficult decision, which is what Governments must do. What priorities would you have in protecting those who most need it? What would your priorities be and how would you deliver them, if there had to be a constraint in budget?

Anne-Marie Carrie: I think we have identified vulnerable groups. We have identified children with special educational needs and disabilities, asylum-seeking children, children who are carers or who are the significant carer, children who have been in the care system, and children who have been fostered or have had multiple family placement breakdowns. You could have a list of children whom you consider to be the most vulnerable, and the system could be set up to support them, and there may also be an element of discretionary income levels, in terms of household income and what is available. I do not think it is for us to design the system. However, you can, without doubt, design the system to support the most vulnerable, but a discretionary learner support fund is not that system.

Bob Reitemeier: I would suggest that the way in which the proposal is projected is that the two criteria are either the care system or income support, so it is an income-based analysis, if you will. What we have been talking about today is the fact that other groups of children require additional support, because of their personal needs. We have talked about special educational needs, disability, and so on. I would add to the categories of care or income those with additional support needs. Those are identifiable, and I would include them in the categories.

Chair: Great. Thank you all very much for your evidence this morning. We will move on to our next witness.

Examination of Witness

Witness: Peter Lauener, Chief Executive, Young People’s Learning Agency, gave evidence.

Q263 Chair: Mr Lauener, thank you for joining us today. Congratulations on your appointment, which was announced yesterday, as the new chief executive of the Education Funding Agency. It is a pleasure to have you with us. We have just heard from a set of witnesses who feel that 16-to-19 participation, particularly for the most vulnerable groups, is being put at risk by current Government policy. How would you respond to that?

Peter Lauener: It might be helpful to start by looking at the historical context on this. I looked back recently at figures over the post-war era. If you go back 60 years, the participation rate for 16-year-olds was 20%, and the participation rate for 17-year-olds was 10%. Going back to 2009-10, which was the last benchmarked year, the figure of 20% for 16-year-olds was up to 93.7%, and the figure of 10% for 17-year-olds was up to 85.2%. We think that that has gone up further in the current year of 2010-11, and the allocation of places that we have made for 2011-12 will, we think, result in that going up a little further again. In terms of that trajectory, it is actually one of the biggest changes in society in the post-war era. It has continued over the last couple of years, and I think that there is every prospect that we are on a good trajectory to get to the YPLA targets for 2013 and 2015.

Q264 Chair: And the answer to my question?

Peter Lauener: I took the question to be whether we are on track to get to full participation in 2013 for 16-year-olds and-

Q265 Chair: My question was this: we have just heard from a pretty distinguished set of witnesses that some of the most vulnerable children are less likely to participate as a direct result of Government policy, whether because of the unfair, inefficient, hugely flawed bursary scheme or the loss of the EMA. I want you to comment on that.

Peter Lauener: Looking at EMAs, there is no doubt that the change from the EMA to the bursary scheme is a big change. It would not be right for me to comment on the policy. No doubt you will be addressing these issues with the Ministers who follow me. When the bursary announcement was made, there was a substantial increase in funding over what had been expected in this sector. I think the bursary pot of £180 million, although less than the EMA expenditure, would be sufficient to allow good targeting on those who would particularly need financial support to help them participate in the first place, and stay in participation at 17. The bursary pot is really important.

Q266 Chair: On participation, you talked about the trajectory and the huge societal change that that indicated, but our trajectory is below that of most other European countries, is it not? Our collective participation is less than that of most of our competitors. Are we going to catch up with them over the next few years?

Peter Lauener: It is pretty good for 16-year-olds. We are not far off 100% participation for 16-year-olds in the current, first post-compulsory year. There is certainly a way to go for 17-year-olds. There are still young people who start at 16 and then drop out at 17, and that raises questions about whether we have the right range of courses for young people to take. We all get into a position where we start on something and think, "Actually, I would rather have done something else." Are we giving enough support to young people to make those choices and changes? That is the area that I would focus on most-the participation of 17-year-olds, where there is a bit further to go than on 16-year-olds.

Q267 Ian Mearns: Good morning. The YPLA, in its 16-to-18 funding statement published in December last year, said that it expected 98% of 16-year-olds to be in education or training in 2011-12. We heard evidence earlier this year from college principals who felt that the numbers were actually dropping in terms of participation. You have produced projections that say that you expect a 1.5% increase in further education, a 4.8% increase in school sixth forms, and a 20.4% increase in apprenticeships. Do you really still expect 98% of 16-year-olds to be in education or training in 2011-12?

Peter Lauener: The figure of 98%, which is in the document I have here, also included employer-funded training, which is knocking on for a percentage point, so that is pretty consistent with the figure I just gave of 96.6%, not including employer-funded training. So yes, I think we are on track to fulfil what was in this funding statement as far as 16-year-olds are concerned, and 17-year-olds. The point you picked up, which a lot of college principals became aware of around the turn of the year, is that recruitment overall, in a lot of cases, was less than was planned, but that was mainly about 18-year-olds.

The number of 18-year-olds starting in the current year, 2010-11, was definitely three or four percentage points down on what we had expected. That would certainly affect colleges’ budgets and colleges’ positions, but it would not affect the question of raising the participation age. I think there are wider issues of what happens to 18-year-olds, the trajectory to higher education, and the labour market, and of course there is a big set of issues about jobs for 18-year-olds. The numbers for 18-year-olds are a bit down; the numbers for 16 and 17-year-olds are carrying on up.

Q268 Ian Mearns: The EMA was mentioned in passing in the answer to the previous question. In my authority area, one of the biggest factors in increasing post-16 participation rates was the introduction of EMA, because we were an EMA pilot authority. There was no doubt about it-the evidence from that period of the EMA pilot was that participation rates almost doubled within a number of years. Do you not see this as a significant additional barrier to the projections that you have set out?

Peter Lauener: When EMA was introduced, there was a lot of thorough evaluation. That could be done because of the way EMA was introduced in the pilot areas; for a time, we were in a very odd position in which some areas had EMA and others did not. I remember quite a number of MPs saying, "I’d like mine to be a pilot area, because I would like my constituents to benefit from this," which is all very understandable, but it allowed some quite thorough evaluation of the impact on participation. Generally, the overall impact assessed through those studies at the time was that there was an impact on participation-I cannot remember the precise number, but it was something like five or six percentage points, rather than an enormous effect on participation. That is partly why I gave that long-term trend, because we have been on a long-term upward trend.

The challenge now is for schools, colleges and other providers to use the bursary fund, which is a much larger amount, and target on those who need the extra financial support to take part. Given the percentages, there seems to be scope to make that work. That is a big challenge now, however, and we are waiting for the final decisions on the way it should be done, but we expect to make the final allocations for the coming year in the next few weeks. That will make everyone suddenly focus on how we can use this tranche of funding best to support young people. For next year, of course there is the EMA transitional support, so if you are on £30 you will get £20 next year, which again is quite a good way of easing into the changes.

Q269 Ian Mearns: Have you projected the numbers for every year between now and, say, 2014-15? If so, have are you making any assumptions in the light of the forthcoming increases in tuition fee levels for university places?

Peter Lauener: It is probably fair to say that we have not yet been able to take account of whether there will be a knock-on effect because of tuition fees. That feels like an uncertain area, doesn’t it? It is developing as we go along. However, we have projected participation right through to 2014-15 and we have built in the expectation that we will get to within a reasonable statistical percentage of full participation. As soon as you get very close to full participation there are always questions about whether the base is right, and all that, but basically, we are projecting that we will get to full participation for 16 and 17-year-olds. The projection for 18-year-olds is a little more variable in the way that I indicated, but as a result of those projections we expect that we will be paying for more places in 2014-15 than we are now.

Q270 Nic Dakin: Good morning. How much is funding going to be reduced per learner in forthcoming years?

Peter Lauener: You will of course be aware of the detail in the funding statements, which set out the significant changes. Very broadly, the story is this: we have rising participation because of raising the participation age and these long-term secular trends. We actually have a demographic downturn, but we still have rising numbers, so we have to pay for more learners. We are also looking to build up the learning programmes of learners who are currently very part-time. We expect to pay more for those, and we are looking to pay more for things such as the disadvantaged factor as part of the Government’s Pupil Premium policy continuing post-16.

All those things put a lot of financial pressure on the budget. In a more favourable financial climate we might have expected the budget to go up, but I expect the budget to be broadly flat, so we are having to recycle and to make savings in parts of the budget to pay for those pressures. That led to the decisions about what is called the entitlement funding being reduced significantly, from 114 hours to 30 hours. We put in place the transitional protection, which meant that no college or school could have a unit reduction of more than 3% last year-that is cash of course; inflation is on top of that, so that is quite a significant change. It is impossible to give an overall figure, because it will vary from college to college.

Q271 Nic Dakin: To go back to my question, because coming from the sector I understand all that, how much is funding being reduced per learner over the next few years?

Peter Lauener: If you take the overall budget and the overall number of learners, it is being reduced very little-only 3 or 4 percentage points or something like that. For some providers, however, who have a low disadvantage factor and things like that-

Q272 Nic Dakin: Is that 3% each year for each forthcoming year?

Peter Lauener: No. The budget is broadly cash flat. The number of learners is going up.

Q273 Nic Dakin: So the 3% reduction per learner is over how many years?

Peter Lauener: By 2014-15-sorry, could you just let me check a point? I do not want to leave the Committee with an incorrect figure. It may be 4 percentage points by the end of the period in cash.

Q274 Nic Dakin: I am sure that you can always clarify that later.

Peter Lauener: I can always clarify, but it is that kind of overall figure.

Q275 Nic Dakin: That is helpful. How will the YPLA evaluate the impact on learners of the cut in entitlement funding?

Peter Lauener: The first thing we look at is what is happening to overall participation. The second thing we look at is what happening to overall achievement. The third thing we look at is what is happening to the gap in achievement, because we are looking to narrow the gap between learners from different socio-economic groups. The story in all those in recent years has been quite good, so we want to keep monitoring those things to see whether we still remain on track for the RPA targets for raising achievement and for narrowing gaps.

The second thing that we are looking at very carefully is the financial viability of providers. We have a robust monitoring system for looking at the position of any providers that face significant financial changes, because, let me be clear, around that average I gave you some providers will face significant unit cost reductions, and schools with sixth forms will face a further reduction to come down the FE funding rate. There are big changes going on as we rebalance funding and it is very important that we look at the financial position of different parts of the sector.

Q276 Nic Dakin: From the first panel, we heard some frustration about the system’s lack of ability for young people to get into education and training mid-year or at different times during the year. Are you looking at ways of altering or improving the funding mechanism to make that more likely to happen?

Peter Lauener: There are two points that I would make. The first is that we have introduced a system called a lagged learner number system-basically, if you deliver 1,000 learners one year, you can expect to have 1,000 learners the next year. I think that is quite a big incentive for colleges, schools and other providers to be quite flexible about when they take students on. Secondly, however, a number of providers, such as the independent training providers, tend to have much more flexible roll-on, roll-off entry dates. In order of flexibility, you have many of the independent training providers and then colleges in the FE sector, and it is much more difficult for schools running the traditional A-level provision to take people mid-way through a course; but looking at the sector as a whole, there is flexibility to take people on mid-way.

There is a further flexibility, which is quite important. We fund up to three years of education through the 16-18 funding system, so if someone starts on a course and realises that they are on the wrong course, they have the opportunity to start a different course and get a further two years of funding.

Q277 Tessa Munt: I want to talk about the bursary fund. I know that the consultation finished on 20 May. I just wondered whether you had any early indications of the sorts of decisions that are going to be made around the administration of the fund.

Peter Lauener: The final decisions are with Ministers to consider. Again, I am sure you would want to ask Ministers how they see these things developing.

In terms of the administration of the funds, we have been looking at two issues: one is how funds should be allocated; the second is what kind of guidance there should be. On the allocation of funds, the responses to the consultation seemed to favour allocating funds on the basis of the current year, where EMA-supported learners are getting £30. We have good data on that. If the decision is to go ahead, we have been modelling on that basis and we would be ready to allocate quite quickly. To take the example of a college. if you had 1% of the national total of EMA learners that had been on £30 this year in your college, you would get 1% of the bursary fund, something like that. Basically, we want to do something nice and simple so that we can get the funds out quickly and straightforwardly. We are waiting for final decisions on that.

The second area is guidance, which we would like to keep as slimline as possible, because it is important that colleges, schools and other providers are able to make best use of the funds and take the decisions locally. That is the philosophy of the bursary fund. We have, however, been working with the Association of Colleges, which might produce further guidance for its members. That is a good way to minimise what is produced by the Department, and for associations to take that a bit further. Again, I want the minimum order burden on this.

Q278 Tessa Munt: When will you issue the guidance for providers?

Peter Lauener: All being well-it is impossible to say at the moment-I hope that we would be able to issue guidance and allocations over the next few weeks. I know that it is high on Ministers’ agenda to take quick decisions, because everyone in the sector is waiting for this news.

Q279 Tessa Munt: This year, the funds for learner support have been allocated in three blocks: August, December and March.

Peter Lauener: The discretionary learner support?

Tessa Munt: Yes. What is the intention for this funding?

Peter Lauener: I would expect to allocate it in a similar way. We would allocate the agreed amount of funding in three blocks in a similar way. We want to keep the administration as straightforward as possible.

Q280 Tessa Munt: I am just wondering about some of those students who might need to access funds for transport purposes.

Peter Lauener: That is why we would frontload it. I cannot remember whether the current year is frontloaded.

Q281 Tessa Munt: So that is the intention as well.

Peter Lauener: I think we would look to frontload the overall funding, perhaps putting half in the first tranche, then a quarter and a quarter, something like that. You make a very good point.

Q282 Lisa Nandy: We were told that the Young Apprenticeships pilot programme is to end, because of high delivery costs that are not justified in the current economic climate. Why were these costs so high? Could something be done to reduce the costs of delivering the programme, so that the programme could be saved?

Peter Lauener: Young Apprenticeships is an expensive programme, because it is funding on top of the existing school funding. In the current climate, it is difficult to justify paying a full capitation fee to a school and then paying an additional amount of top for two days a week. It is an expensive programme, although the results are terrific, I have to say. The programme is very popular with young people and the achievement rates are good. I am not quite so sure of this, but I think I have read that the progression story is pretty good as well.

The challenge-this is part of the whole philosophy of the Government’s approach and is very much reflected in Alison Wolf’s report-is for schools and colleges to develop those kind of approaches as part of their mainstream programmes. I would like to see that kind of approach being developed. You could say, and Lord Baker may well say, he is expecting the UTC approach to reflect those models. It is a very similar philosophy: two days a week on technical subjects and three days a week on academic subjects. That would be within the mainstream funding. I hope that the lessons will be taken through, but in the current climate it is difficult to see how we can justify continuing it.

Q283 Lisa Nandy: If the results are terrific, does that not represent good value for money-investing in young people to make sure that in the future, it does not cost us more?

Peter Lauener: It is not a basis for roll-out more widely than the pilot. The important thing is to learn lessons about the curriculum and the way of arranging provision for young people. But it needs to be done within mainstream funding.

Q284 Lisa Nandy: Are you confident that schools and colleges will take that challenge on and deliver it?

Peter Lauener: I think that there is a lot of good practice. One of the things that struck me over the last 18 months is that there is a lot more collaboration embedded between schools and colleges than when I worked with the further education sector seven or eight years ago, when we were trying to start that out. Generally, funding mechanisms have been put in place between schools and colleges to pay for the one or two days a week that young people might be spending out of a school environment in a college environment. There is a lot more of that happening, much more widely than young apprenticeships, and that gives me confidence that there is the basis for taking that forward, plus the reforms that will be made on the back of the Alison Wolf report, which I think are really important reforms that elevate the importance of vocational education.

Q285 Chair: Can I ask you quickly about the quality of apprenticeships? The Government are obviously keen to have a great deal more. Can you tell us about what quality assurance there will be? Are they long enough? Are they going to be able to maintain quality while increasing numbers?

Peter Lauener: The first thing I ought to say is that the YPLA is not directly responsible for apprenticeships-the funding goes from the Department to the National Apprenticeship Service. Again, if you take a look at the long-term success rates-I cannot quote the before and after in the way that I did earlier on my 60-year trend-there are some quite startling improvements in success rates for apprenticeships. Seven or eight years ago they were languishing at around the low-30s percentage points, which was just not good enough; they are now, I think-my memory may be faulty-60% or 70%, so there is no doubt in my mind that the quality is far higher than it used to be. Also, for 16, 17 and 18-year-olds, the numbers are more static; the real growth is in the older apprenticeships.

There is certainly a challenge to make sure that there is real added value and that it is not just about accrediting learning that is going on anyway. Again, Alison Wolf comments on the importance of looking at international comparisons. Her feeling was that there is still quite a lot of bureaucracy around apprenticeships. There are quite a few challenges in there, but I think there is some good recent performance, which is very encouraging.

Chair: Thank you very much for giving evidence to us this morning.

Peter Lauener: Thank you all very much.

Examination of Witnesses

Witnesses: John Hayes MP, Minister for Further Education, Skills and Lifelong Learning, Department for Education/Department for Business, Innovation and Skills, and Lord Hill of Oareford CBE, Parliamentary Under-Secretary of State, Department for Education, gave evidence.

Q286 Chair: Welcome both of you. Thank you for joining us to talk about 16-to-19 participation. It is always a delight to have Lord Hill with us. It is a particular delight to have John Hayes, because he is the final missing ministerial piece of the Department to give evidence to us. It is a pleasure to have you before us, Minister.

The number of 16 to 18-year-olds who were not in education, employment or training actually increased by more than 30% between 1999 and 2009. What is the Government analysis of why that happened? What lessons can be learned to ensure that participation improves in future years?

Mr Hayes: I think you are right to identify it as a trend change, rather than the product of a particular set of economic circumstances. If you look at the change in the number of NEETs over the period you described, it happened irrespective of economic peaks and troughs, so clearly there is a trend issue around the employment of young people. I could write an essay on this, Chairman, but you will not want me to do so, so let me just identify three reasons.

Chair: Armed with a thesaurus, I would be able to read it.

Mr Hayes: It would be a delight to write it for you, but perhaps I will do that offline. I think there a three reasons. First, there is a significant problem with prior attainment, which I am sure Lord Hill will want to comment on; and as the labour market has changed, the number of jobs you can get and keep that do not require core skills has fallen. Lord Leitch’s review identified the fact that the number of unskilled jobs in the economy is shrinking-he said that by 2020 it might fall to as low a figure as 600,000-so if you leave school without core qualifications, it is harder to get a job and keep a job.

Q287 Chair: Sorry to interrupt you, but is it still the Government’s assessment that those numbers from Lord Leitch are broadly correct?

Mr Hayes: What I would say about the Leitch report, as many said about it when it was published, is that while one might not want to get into a debate about the exact number, he was right about the trend. It is hard to predict those kinds of numbers, but he took a stab at it, which was brave. I would not want to say it was going to be 500,000, 600,000 or 700,000, but what is very clear is that the number of unskilled jobs in the economy is shrinking and has been for a considerable time. This, by the way, is a feature of the change in the economy itself. As economies advance, two things happen: first, they become more high skilled and, secondly, they become more dynamic-they change more rapidly.

To return to my main thesis, though, the second reason is that there are real issues around whether we have got the vocational offer right. If you compare our level of vocational skills with that of most of our principal competitors, there are fundamental problems about people having the skills to match economic need. That is the second reason. Vocational education in those terms is very important, and I have spoken about it at length over a long time, as you know, Chairman.

The third issue is around the entry point into work. What we know is that some NEETs have had jobs for a very short time; they have drifted in and out of employment; and many of them have had an unhappy experience in the transition from the world of learning to the world of work. We need to get the advice and guidance better. We need to look at things like work experience as a way of easing that transition. We need to do all kinds of other things to bring people from disengagement to engagement. We should recognise that that might require small chunks of learning and small steps to re-engagement. This is particularly true when people are disengaged for a long time; it is not actually that easy to get back into a full-time job when you have had a very poor experience of learning and a mixed experience of work.

Those are three of the things I think we need to look at. The previous Government understood this, and I do not want to make a party political remark, but I am not sure any of us has made significant progress with this, and it requires urgent action.

Chair: Thank you very much, Minister.

Q288 Nic Dakin: Welcome John and Jonathan. We have just had evidence from Thomas Spielhofer, who was the lead on the NFER research that the Government have relied on as an evidence base to justify their policy decision on EMAs. He made it very clear that he did not see that as a correct use of his research, and he did not identify with the concept of deadweight-indeed, he spoke positively about EMAs. We have also had evidence from the chief executives of Centrepoint, the Children’s Society and Barnardo’s, each of whom said that EMAs were a deal breaker, that they were utterly opposed to the discretionary loan support, and that they had real concerns about unintended consequences. Does that evidence give you pause for thought on the direction of policy travel on EMAs and the damage that might be done to young people?

Lord Hill: On the EMA, obviously I did not hear the remarks that he made, but the Government looked at a range of research, of which that was one, commissioned by the previous Government.

Q289 Nic Dakin: What other research did the Government look at?

Lord Hill: There was IFS research, there was research carried out by NatCen, I think. Across the piece, the conclusion that we drew from that-research carried out under the previous Administration-

Q290 Nic Dakin: The conclusion you drew, rather than the researchers drew. That is the point that came out in previous evidence, which I think you are confirming.

Lord Hill: The point across the piece is first, assistance that goes to 45% of young people does not feel enormously targeted. Secondly, there is the underlying principle of a scheme that was understandably designed to provide an incentive for young people to stay on; as you move to a system where we have raised the participation age, where it is going to be a requirement to stay on, then a system based on an incentive does not feel right, and a system that is based on financial support for those who need it most feels a more sensible way forward. That is why we took the decision that we did.

Q291 Nic Dakin: Do you think that Government and all of us have let down the current year 11 students, who still do not know what support they may or may not have? Are we still letting them down? They still don’t know, do they?

Lord Hill: They don’t. I am keen that we should get the allocations and the guidance out.

Q292 Nic Dakin: But we have been keen. We have had Ministers here throughout the year and we have been asking Ministers in the House, and they have been keen every time-they have been keen for nine months and the kids still don’t know. Is that not very shoddy?

Lord Hill: One can make perfectly fair criticisms about the length of time it took us to come up with the replacement, the new bursary scheme. It would have been good to have done that more quickly. I accept that reproach and criticism. In terms of the length of time it has taken since then, clearly we had to consult on the back of those new proposals-quite rightly. That ended on 20 May. I hope that we will be in a position to get the allocation and guidance out together at the same time within a week or two. That is what I am pushing my officials to do.

Q293 Nic Dakin: Given that the figure has increased over that period to £180 million, would it not be better to go for a universal scheme like the EMA, rather than go through all the administrative complications, which are still going through, that are part of the reason why young people still do not know what’s what? In one part of the country, we have heard this morning, they will have a different deal from another part of the country. Is that fair?

Lord Hill: Again, as you will know, one of the broad approaches that we are keen to develop across the piece is first, pushing decisions down to heads and schools and colleges as autonomous institutions and trusting their judgment-trusting those who know their pupils and students best to make those calls. The principle is to devolve that money, ask them to make those decisions and give them a proportion of the sums for the administrative cost. According to the conversations that I have had with principals, apart from their concerns about the ending of EMA, the principle that they should be responsible for disbursing it is one they are broadly content with.

Nic Dakin: That is perhaps correct, but it is also correct that they were very clear they would have preferred EMA to remain, even if it was in a slightly smaller quantum or shape. You are not far off getting to the level of quantum that would have been effective.

Q294 Bill Esterson: I have been comparing your two opening comments. I think everybody would agree with John’s analysis of the economic needs, but surely there is a concern that taking away the EMA will make the situation worse. There is evidence, reported to me by Merseyside Colleges Association, that principals are very confident that the element of compulsion, and the improved results of those on EMA compared with those not on EMA, indicate that taking away the universal element will add to the number of NEETs. Although John’s analysis was strong, the new policy on EMA is going to make that situation worse, not better.

Lord Hill: I know that I do not need to rehearse for the Committee the economic imperatives that were driving our decisions across a range of issues to do with funding. There may be others that we will come on to talk about as well. We had to act quickly on the EMA. As I said before, we were spending £560 million a year on something that was designed as an incentive scheme, when we are moving, rightly, to raising the participation age and seeking full participation. Obviously, I agree with John and with you that that is the direction that we want to go in. The targeted way that we are delivering it is, we think, the right way forward, but obviously, as you would expect, we said when we announced the new scheme that we will have to see how it operates, and we will keep those arrangements under review.

Q295 Bill Esterson: One other big concern that has been raised with me is young carers and other vulnerable groups. Principals tell me that they do not know who those young people are, because young people do not like to admit to being a young carer or from a vulnerable group. It is very hard to target those groups if you do not know who they are, and those are some of the people who are most in need of EMA.

Lord Hill: We hope that, as the way to demonstrate the entitlement-through receipt of income support or whatever-is straightforward, it should not be a difficult task for people to claim it. I take your broader point, though. It links to the points that Mr Dakin made. The length of time that this has taken means that the need for clear communication about what people’s entitlements are is extremely important. The AOC is working with a group of colleges to develop that guidance. I am keen to get the details of the scheme and the criteria out there as soon as possible, so that people can see that, and so that we can address your concerns.

Mr Hayes: Might I say a word about that? We had an interesting and valuable debate about the purpose of that kind of support. When EMA was introduced, participation patterns were quite different. There is an absolutely legitimate argument to be had about how you support learners and the effect that that has on participation. As Lord Hill knows, in the discussions that we had at ministerial level, I was very anxious to ensure that the most disadvantaged learners were not further disadvantaged by changes that we might make.

The complex thing about dealing with those disadvantages is that they may be very different in different parts of the country, and for different kinds of learners and colleges. Maximising discretion, in those terms, seemed to me to be critical. What we are doing is trying to maximise that discretion while ensuring that money is targeted at the most disadvantaged learners. That is what underpins what we have been doing, albeit in the context of trying to do something that is cost-effective, given the financial circumstances. Whoever was in government, it is likely that EMA would have been reviewed and reformed because of those changing assumptions about participation and cause and effect with regard to how you support learners.

Q296 Lisa Nandy: We have just heard from a whole range of witnesses who have told us that the shift from a system based on entitlement to a discretionary system will impact on the most disadvantaged the most because of the stigma associated with having to come forward to claim under what is now a discretionary system. What are you going to do about that?

Mr Hayes: That is a good point. There are issues around how you allocate the money, and you make an interesting and useful point about the risk of stigma, but I am absolutely convinced that discretion matters because of what I said in the previous answer-the different requirements in different places. For example, in Lincolnshire, the area that I represent, transport is a fundamentally important issue. That applies disproportionately to the most disadvantaged learners.

Q297 Lisa Nandy: I completely accept that transport is an important issue; I think we all do. The key point that they made is that the system that you are introducing is based on the wrong principle, because the people who most need it will not come forward to claim the help. What will you do to make sure that they do?

Mr Hayes: I will give you a straight answer to that. That is an extremely useful insight, and in the work we do on the guidance, we will look at how we can address that specific point as a result of the representations we have received not only from this Committee, but from others. This is not the first time I have heard that argument. I am absolutely determined that the most disadvantaged should not be worse off as a result of this change.

Q298 Lisa Nandy: The other point that has been made to us very forcefully, directly by students, is that many students now rely on the EMA as an essential part of their household income. The decision to go on to further schooling or college is based on knowledge of the income that they will have. Obviously, under the new system, it will be very difficult for students to know in advance what they will get. How will you make sure that they can base their decision to go to college on sound financial information?

Mr Hayes: In a sense, that is the tough issue, isn’t it? The original intention of EMA was to change the character, nature and scale of participation. What it became, what it metamorphosed into, was the kind of much more general financial support for the family that you are describing. I am not sure that we can legitimise that as a Government. I am not sure that public policy makers of any colour or kind could legitimise that metamorphosis and embed it in public policy. I just do not think you can do that.

Q299 Lisa Nandy: Are you arguing that the Government’s position is that students should experience serious hardship in order to get the same opportunities as their better-off peers?

Mr Hayes: No, I am arguing that in the tough climate we face, it is very important that we tie EMA directly to its original purpose, which is the relationship with participation, in a way that addresses particular challenges, needs and disadvantages, rather than allow what has become a distortion of the original intention. EMA was paid as a much more general payment that was absorbed into the family income and used for other things. I do not say that that does not have consequential virtues, but it is not what EMA was intended to be, and it is not what EMA or its replacement should be. I want a more targeted and more cost-effective system of support that can be directly linked to and measured by its effect on participation.

Q300 Lisa Nandy: May I probe you a little on the definition of "in need"? When BIS drew up the student funding guidelines for higher education, it said that there would be greater financial support for those whose family income is less then £25,000. Obviously, BIS felt that there would be financial barriers to accessing higher education for students who come from such backgrounds, but the EMA remains only for those in households earning less than £20,800. Shouldn’t there be a consistent definition across Government of what constitutes "in need"?

Mr Hayes: If you look at the participation changes that I described earlier, with 96% of 16-year-olds and 94% of 17-year-olds now participating, and how that has changed over the period from when EMA was introduced to now, and then look at the participation in higher education from under-represented groups, progress in higher education has been much slower. I think all would acknowledge that widening participation in higher education has been a significant challenge, and not necessarily one in which we have made the progress we would have liked. I am putting that in as measured a way as I can.

I would argue that the need to address some of the fundamental problems of engaging working-class students and other under-represented groups in higher education is so pressing that it requires a different set of assumptions, and a different policy outcome from those assumptions. We have had quite a lot of success, in other words, in boosting participation among 16 and 17-year-olds, but we have not had anywhere near as much success in boosting participation in HE from those under-represented groups you describe.

Q301 Lisa Nandy: On a point of fact, we were just given a much lower number from Peter Lauener, the head of the YPLA, for participation rates among 16 and 17-year-olds. He said that it was 85% at the moment.

Mr Hayes: I am using the figures from the Department, and I can only use those figures. As a Minister at the Department, it would be quite wrong of me not to refer to the Department’s analysis.

Q302 Chair: He did differentiate between some figures that included work-based learning and others that did not, so it is possible that that is the discrepancy, but if officials wrote to the Committee to clarify the point for us, we would be grateful.

Mr Hayes: We would be delighted to do that.

Q303 Neil Carmichael: The Minister touched on some central funding issues, but I was wondering about free school lunches. Obviously, children in a sixth form can get free school lunches; will you extend that to FE colleges?

Lord Hill: It will be the same principle for the new fund. Whether it is transport or helping with food, that would be at the discretion of the school or college. That reflects in part the fact that the landscape and what young people are doing post-16 is quite different from what they are doing pre-16. They are working in different places; they travel; they arrive; they might be doing an apprenticeship; they might be at work. The universal approach to all in the cohort saying, "This is the entitlement you get" does not fit as comfortably with one model post-16 as it does pre-16.

Q304 Neil Carmichael: So, essentially, it is at the empowerment of the institution and organisations to make decisions to fit the circumstances of the students.

Lord Hill: Yes.

Q305 Neil Carmichael: It seems perfectly logical to me. Is it equally fair to say that 17 and 18-year-olds attending compulsory study or training should be eligible for free school transport and so forth?

Lord Hill: I would argue that the post-16 situation on transport applies to free school meals. Again, in different parts of the country there are different priorities around transport. If you are in a sparsely populated rural area, transport obviously weighs more heavily in your mind than if you are living in a city and can walk up the road. The approach to that is to put the discretion with the college. Transport is an important issue.

As for the local authority role in the provision of transport, by the end of May it will have been publishing all its statements on what provision it is making for post-16s. We need to look at that to ensure that its duties are being discharged. We need to be consistent about transport and put the decision to the local institution. As we said when we put in the replacement, we will keep it all under review, because I do not underestimate the importance of the issue.

Q306 Neil Carmichael: What sort of capacities will you have to check that local authorities have, in fact, undertaken those responsibilities?

Lord Hill: As I said, I have asked officials to look at all the statements that local authorities have been making. We will then meet to look at them, because across the country, what appears to be happening so far is that different local authorities are discharging those duties in different ways.

Q307 Neil Carmichael: Finally, this is really a question for John. You will obviously reduce entitlement funding. What impact do you think entitlement funding will have on FE colleges?

Mr Hayes: It needs to be seen in the context of the overall work we are doing in FE. The critical thing about provision is that it matches demand. Historically, FE colleges are a bit too limited in their flexibility to respond to demand, so we have tried to free FE colleges from some constraints, particularly financial, that prevented them from being as responsive as they would like to be. A good example is being able to move money between budgets to deal with different and changing demands. My feeling is that participation, which is at the heart of your point, will be affected by changing entitlements, but that effect will be offset by the increasing capacity of FE colleges to devise and implement an offer that is better suited to demand. I am very confident, as I think the FE sector is, that in a world where it will be given much more freedom in the way that I described, it will be able to engage people to maintain participation.

Q308 Neil Carmichael: Are you picking up any evidence that those freedoms are being discussed and even developed in colleges?

Mr Hayes: Yes. They have been warmly welcomed by the sector and by the representative organisations in the sector, such as the AOC and the 157 Group. We are introducing more in the Bill that is currently going through the Houses of Parliament, and there is evidence that the colleges are responding to that new opportunity by forming more creative partnerships with local businesses and looking again at how they can allocate funds and resource to new kinds of courses of training. They have been very successful in moving budgets from Train to Gain to the apprenticeship budget.

I know we will probably move on to apprenticeships at some point, Chairman, but I hope that when I am able to say more to the House in June about apprenticeships, we will be able to show very substantial growth in apprenticeship take-up for young people as well as other age groups, which is in part a response to the good work that the colleges have done in moving funds in the way that I have described.

Neil Carmichael: Thank you.

Q309 Tessa Munt: As an observation on some points that Neil raised, I have serious concerns about rural areas, as Jonathan will know, and about the whole transport thing. In Somerset, there is no indication of what the bus pass is going to cost, and no idea of when that decision will be made. That really is a serious problem for young people who are trying to plan anything for September. I will put in a plea for free transport for young people again.

I wanted to ask you some questions about the transfer of information from schools to colleges. Some local authorities say they cannot pass on data, and there are problems with that sort of thing. How do we get that data if there are data protection issues and statutory requirements stopping people passing on information? Colleges perform better with young people who are new if they know what they have got coming.

Mr Hayes: The kind of relationship that you are describing, both between schools and colleges and between colleges, schools and other bodies, is critical to charting the progress of a young person through their learning. It is right that some schools and colleges do this very well. The partnership between schools and colleges in particular areas-I am thinking of my own constituency-can be highly effective, but that tends to be the case when they do not see each other as competitors. When they see each other as competitors, sometimes there is more tension in those relationships.

I think what we need to do as a Government is encourage good practice, identify it and look at ways that it can be exported more widely. Those collaborations are clearly, in the end, a matter for local judgment, because the circumstances in different localities, of course, necessitate different approaches. None the less, Government can send out very clear signals that they expect information to be transmitted between organisations and that they expect the progress of a young person’s learning to be charted across the period for which they are statutorily engaged in education. I think we can send out signals about good practice, and I think we can build on the good practice that is already out there.

Q310 Tessa Munt: But there is going to be a conflict always, isn’t there, between schools, which will receive funding if students stay on? The head teacher will want that student to stay. I have raised on previous occasions the issue of how that stops students having access to information on getting to an alternative provider of further education.

Mr Hayes: Yes, but it may also be about progression; Jonathan may want to say more about that. Where a student is studying to a particular level at school, then going on to college to take their studies further, we need to make sure there is a good fit, both in terms of what they are studying-so there is a good, progressive fit with the work that they are doing-and in terms of the information that is then sent from one institution to another about that learner. That can be done even in a world which is, as you describe it, competitive. It is not just about the money, as it were; it is also about the offer.

Lord Hill: Can I make one point to follow on from that? We may come back to it-I don’t know-but it is on the development of destination measures. The concern, as you rightly say, that sixth-form or FE colleges might have is that a school will want to keep its pupil there to keep the cash. As we develop the destination measures on which we are working-I would welcome suggestions either collectively from the Committee, or individually from Members with a particular interest-we will get to a point where we can look at the comparative performance of different kinds of provision, whether it is school or college. You see what the destination of those pupils is one year on after key stage 4 and after key stage 5. If what one then sees is that school A, by doing what you are afraid it will do, has results-the progression of its pupils-that are less good than sixth-form college B or FE college C, I think that that will create a powerful lever alongside the kind of pressures that John is talking about to address those concerns.

Q311 Tessa Munt: I will certainly come back to you; you know that.

Is there any legal restriction that prevents data being passed from school to school, and school to college, and vice versa? We have found in other inquiries that when children move from first school to middle school, or from junior to senior school, the school does not know about ability and any special needs.

Lord Hill: I know that there is one data issue around the provision of the destination measures that we need to address, which we are taking powers to do in the Bill. In other areas, to be honest, I am not sure, but I will check whether there are any of these barriers.

Q312 Tessa Munt: Will you come back to us?

Lord Hill: Yes, of course.

Tessa Munt: Thank you, that would be kind.

Mr Hayes: Perhaps, Tessa, I could add to that. If there are issues of the kind you describe in these schools and colleges, I will take a look at that and we will address it. There is no good argument for not transferring information that is of value to the learner, as long as other considerations about privacy and so on are taken into account and dealt with, so we will certainly look at that and address it.

Q313 Tessa Munt: Thank you. I will ask you just one other thing. I wonder why the Government have paused on the enforcement around participation age.

Mr Hayes: That was debated at length when these matters were originally raised in the previous Parliament. The argument ran-I think it was put by the then Opposition, and I put it no more strongly than that, to the then Government-that enforcement would be very difficult. Were you really going to criminalise young people who did not engage? That was used as an argument against raising the participation age, but there have been arguments against raising the participation age at every stage since it was raised from 13 to 14. There is a challenge on enforcement, but it never seemed to me to be a sufficiently strong argument to oppose the principle of raising the participation age, which is why that very Opposition at that very time did not oppose it.

Lord Hill: There is also a linked and important point, apart from John’s arguments about carrot rather than stick, that underpins what we are doing in terms of Wolf and our school reforms more generally. Attainment before 16 is the most important determinant of success and progression after 16. So, with school reforms, we have to get to a situation where 16 and 17-year-olds want to benefit and progress, and then there is the overhaul of vocational qualifications. We did not want to be in a situation where you criminalise those who don’t. We have to make it attractive and to improve the quality of the offer, but we have the power to keep the situation under review, which we have said we will do in every year after 2013 to see how it is going.

Q314 Tessa Munt: Have you got a plan for those who do not participate when it is the law to do so?

Lord Hill: What we are doing across the Government is this: BIS and DWP are working over the summer to come up with a strategy on participation and addressing the specific NEETs issue. The answer is therefore yes. The duties on local authorities, which have been there for some time, are to identify, report, target and work with the voluntary sector. There is a range of measures, but we are looking at the issue across the Government.

Q315 Tessa Munt: Do you think that local authorities use those powers?

Lord Hill: Yes, they do. Through our RPA trials that are going on, which is an important element, local authorities are trialling and learning from other local authorities what is the most effective way of identifying, tackling and supporting NEETs, and of getting them into worthwhile work and training.

Mr Hayes: The previous Select Committee-the Children, Schools and Families Committee-in its report on Young People Not in Education, Employment or Training, the eighth report of the 2009-10 Session, specifically recommended that kind of cross-departmental working. The Government are anxious always to consider the reports and recommendations of Select Committees, and we do our best to ensure that they are built into our assumptions-

Chair: We are always open to flattery, and we appreciate it. During that inquiry, we went to Holland, which has the lowest level of NEETs in the OECD-that is touched on in there. Following up on that, the Dutch recently changed the incentives for local authorities. I know that this is as much to do with the DWP as it is to do with the DFE, but I put it to you that by changing the incentives and the financial impact of youth unemployment on local authorities they, instead of possibly only paying lip service to dealing with NEETs, took on a much more proactive role and made a difference. I hope that you might look at that, if you have the chance.

Q316 Neil Carmichael: John, how many 16 to 18-year-olds have we got in apprenticeships right now?

Mr Hayes: I cannot give you those figures, but I will happily confirm them after, because we are about to report to the House on the information that we have available up until June. It would obviously be wrong for me to bring those figures to the Select Committee before they have gone to the House. The provisional data for the first period showed substantial growth in the number of 16 to 18-year-olds engaged in apprenticeships. That is across sectors, by the way, and across levels-level 2 and beyond.

Our ambition is clear, Neil. I intend that we create more apprenticeships in Britain than we have ever had before in our history. We have the funding in place to do that, and the information that I will make available in June will show that we are making very good progress.

Q317 Neil Carmichael: Is there a difference between the ability to recruit 16 to 18-year-olds and to recruit adults into apprenticeships?

Mr Hayes: Yes, there is a big series of differences. First, we know the patterns of the previous Government’s performance in respect of apprenticeships. I want to acknowledge through you, Chair, that there was considerable improvement. There is no doubt that apprenticeship numbers grew under the previous Government, which needs to be put on record. We are going to take it faster and further, but none the less progress was made. We know, for example, that some employers are more reluctant to consider a young person because of things such as soft skills-they are often called employability skills. We also know that, in sector-by-sector terms, the patterns are different in terms of different age groups, so there are challenges around 16 to 18-year-olds.

That was recognised by Alison Wolf in her report, which was produced for the Government. As she argues, the virtues of apprenticeships as a key vehicle for delivering the vocational offer, which we want to make as rigorous and as attractive as the academic offer, are that the brand is strong, that employers value apprenticeships, that potential learners also value them and that the competencies offered really add to employability. Yes, there are challenges about 16 to 18-year-olds, but they are not insurmountable, in my view.

Q318 Neil Carmichael: How about getting more apprenticeships into SMEs, because that seems to be a challenge?

Mr Hayes: Yes, and if I may say so, SMEs with very young people bring two separate challenges, which combined can create a hurdle that we need to overcome. Alison Wolf argues that we should actually financially incentivise SMEs-[Interruption.]

Chair: If you wait until the bell finishes, Minister. Thank you.

Mr Hayes: Saved by the bell.

Chair: You have always been masterly in your use of pauses, anyway.

Mr Hayes: Alison Wolf says that we should financially incentivise small businesses. We do not resist that idea. We have to look at it in some detail, because there is always the risk of deadweight, which was a criticism of Train to Gain. None the less, there may be arguments around particular kinds of learners, sectors and businesses that do require us to consider what Alison Wolf recommended.

Other things that we are doing are around bureaucracy. I was in a meeting yesterday with business leaders. I held a series of briefings and meetings with representatives of business to look at how we can make the system more streamlined and less bureaucratic. We can cut red tape and thereby make this more attractive to particularly smaller firms, which find it harder to absorb all that. I hope very soon to be able to say more about what we are going to do to reduce bureaucracy. I think bureaucracy matters too.

Finally, the frameworks have to deliver competencies that match real employer need. I am absolutely determined that-working with the UK Commission for Employment and Skills and the sector skills councils-what is taught and tested is what businesses want.

Q319 Chair: How long is your average apprenticeship in this country? How does it compare with others and how long do you think they ought to be?

Mr Hayes: An apprenticeship is typically a three-year training course. The length of time and the cost of that varies according to the sector, so there is immense variability, as I think you know. It is a significant commitment for both the employer and the young person, which is what I think you are getting at. That is why we need to look at some of the perceived and real costs of that, and see if we can make it even more attractive than it is.

Q320 Chair: I just wanted to check that you were not thinking of encouraging shorter apprenticeships, which I would consider to be misguided thinking, because that would make things cheaper and easier. During an apprenticeship there is a long period in which the young person is not particularly contributing. If there is a longer apprenticeship, there is a decent period in which they do contribute.

Mr Hayes: Let me take the opportunity to put this on record. If we grew the numbers as rapidly and to the extent that we intend, there would be a risk of diluting the quality, but I have absolutely no intention that that will happen. My determination is immense that we will retain quality so that the brand is regarded-as described by both learners and employers-as something of immense worth, as it always has been. It would be to short-change both learners and employers to do anything other than that. We are absolutely sure about maintaining the quality as well as the quantity.

Q321 Neil Carmichael: Returning to SMEs, can we encourage them to share apprentices?

Mr Hayes: That is a good question, Neil. When I was speaking to the sector skills council and employers from the horticulture industry very recently about that, they told me that they found it quite hard to take apprentices because, as small employers, they found it difficult to meet some of the requirements of apprenticeship alone. They have started to work on systems of collaboration of the kind you described. Several of them have come together to meet the requirements of apprenticeship without diluting quality. I am very happy to take their work further to see if we can look at how SMEs might come together without in any way changing the rigor of the requirements.

Group training associations, of course, are another way forward for SMEs. GTAs have a proud history, but we would like to see them grow. That is a way for very small businesses to come together and share some of the administrative and resource costs, through the GTA. Apprenticeship training associations and group training associations are things that we want to see grow as a means of engaging more SMEs.

Q322 Neil Carmichael: Excellent.

One of the things that I have noticed is that we still need to demonstrate the attractiveness and good sense of getting involved in manufacturing and engineering. The rebalancing of the economy should obviously be uppermost in our mind, but there is also the obvious point that we are not attracting sufficient skills into those sectors. What do we do, first of all, to highlight the advantages of those sectors and, secondly, to start encouraging people to go into them?

Mr Hayes: Jonathan may want to say more on this, but in anticipation of this Committee sitting, we have been discussing the link between the world of work and the world of learning. I think that we need to do more to encourage contact between businesses, and schools and colleges. We need to make the world of work attractive to young people who are choosing their careers. The careers service will play a part, but as well as that, I want to look at how we can get more businesses into colleges and schools to show young people what a career is like in manufacturing or engineering, for example, and why it is attractive. We know that it is. To give an example, if I may, if you have a level 3 apprenticeship in engineering, your earning premium over a lifetime is equivalent to a degree, roughly speaking. There is therefore no doubt about the reality, but the perception matters, too. Better communication between the world of work and the world of learning would help to change perceptions.

Lord Hill: Also, there are a couple of specific examples, such as the development of the university technical colleges, which should do exactly what you are talking about-they will be bringing in universities and local big employers, who are often manufacturers, and offering 14 to 19 courses of education with an academic core and vocational side. That is one example, and alongside that, there are studio schools, which the previous Government pioneered. I am very keen to build on that and roll them out as far as possible. Children there have often been a bit switched off from learning, but they are able to learn. Local employers-often small employers, in this case-come in so that children get accustomed to the kinds of skills and attributes that they will need to go and work. Often, having been through that, they will go and get jobs with people who are coming in and teaching.

Q323 Neil Carmichael: What about the 80,000 additional funded work experience places that were announced in the Budget? Could you tell us a little more about them?

Mr Hayes: Yes, absolutely. In fact, I was in a meeting with the DWP and the Minister of State there yesterday. One of the issues we talked about was how we manage that process to ensure that the work experience places that we secure are meaningful and that they deliver progression of the kind that I described earlier in a different context.

Work experience, as we know, is an important way in which people can get their first taste of employment. In another report of a previous Committee, it was argued that work experience was a very valuable way for people to get the necessary experience to make judgments about where their future might lie. I will not bore with you the details of it, but you can be assured that we take that very seriously. That is why we have been engaged with large, national companies and with representative organisations of companies-I was speaking to the CBI about this yesterday-to ensure that those work experience places grow, that they are meaningful, and that they are progressive. We see them as an important part of an overall programme, in terms of changing perceptions about different career options, in the way that you suggested in your previous question.

Q324 Neil Carmichael: How are we going to ensure that quality control is sufficiently robust?

Mr Hayes: Of work experience?

Neil Carmichael: Yes.

Mr Hayes: That is exactly what I just described. We will make sure that the work experience on offer is meaningful. If work experience is not controlled in the way in which you describe, it does not serve the purpose that I want it to. We are working with the DWP to ensure that we look at each of the work experience places and each of the employers that are offering them to make sure that they are indeed meaningful.

Neil Carmichael: Great. Thank you.

Q325 Chair: You have scrapped programme-led apprenticeships. We heard from evidence today that under-achieving and vulnerable young people find apprenticeships a rung too high to reach. When will the Government announce a policy on what they will do to help to get such people ready for apprenticeships?

Lord Hill: We announced the 10,000 access to apprenticeship places.

Mr Hayes: Exactly. In the autumn, we will say more about the access to our apprenticeship programmes. I agree with the assumption behind your question that there is a need to provide a ladder that allows people who are not ready to engage in a full apprenticeship to access meaningful training. Access to apprenticeships will be just that ladder. What I want to create is a pathway that is progressive, rigorous and just as seductive as the academic route that many of us took. That means moving people from disengagement to engagement through bite-sized chunks of learning. It means providing access to apprenticeship courses that then lead to levels 2 and 3 and beyond. It means having a robust product that allows people the kind of opportunity that you describe.

Programme-led apprenticeships may have served a purpose in some cases, but the problem was that they were not enough like a real apprenticeship because they were not enough like a real job.

Chair: Some were.

Mr Hayes: Some were not. They may have served a purpose in some cases. I want to ensure that access to apprenticeships is much more like a real apprenticeship and therefore much more progressive in those terms. As I said, we will say more about that in the autumn. Just yesterday-I think that I can reveal this-I asked my officials for a progress report to ensure that they are up to speed and up to scratch when we make those announcements on details in the autumn.

Q326 Ian Mearns: I want to ask questions about careers. Before I do so, seeing as we are talking about apprenticeships, let me say that we heard Peter Lauener in the previous session telling us that although it was expensive, the results from the Young Apprenticeships programme were terrific. Rather than abolishing it, could we not have reduced those costs without harming the essence of the programme? Would it not have been more sensitive to delay the ending of the pilot until university technical colleges had become better established?

Mr Hayes: The problem with the Young Apprenticeships scheme was not the level of learner or employer satisfaction. Indeed, the survey suggested that there were quite high levels of support from employers, parents and learners. As you suggested in your question, the problem is the cost. Measured in any kind of cost-effectiveness terms, it was a very expensive way in which to give the kind of taste of the world of work that I mentioned to Neil. In the work that we do on access, we need to take the best of what Young Apprenticeships offered. We need to take the best of that product, frame it in a way in which it is more cost-effective, and build in our assumptions about access to apprenticeships. Indeed, we have had this debate. I made the case that there was value in the Young Apprenticeships programme and that we should not ignore it, but we have to do it in a way in which we could afford.

Q327 Ian Mearns: You are right. It has been described to us as expensive, but it was very successful. There is a value-for-money element to success, and that should be taken on board.

Mr Hayes: Yes, but it affected a relatively small number of people and it involved the investment of an immense amount of money. I would not want to under-estimate its value, but in the form in which it previously ran, it was unsustainable in the current financial circumstances. I mentioned that it had good feedback from various people, and I want to look at that feedback and the best aspects of it to see how we can build it into future work.

Ian Mearns: But if the head of the YPLA says that the results were terrific, that is evidence in itself, isn’t it?

Chair: It is, but we will move on to careers now.

Q328 Ian Mearns: The careers service is in a mess at the moment isn’t it, Minister? There is evidence from all over the country that we are losing careers advisors. We have a good aim-to establish an all-age careers advice and guidance service in the near future-but in the interim period we are in a bit of a problem.

I think that it is quite clear that we were told in this Committee a number of weeks ago that the Hayes vision for the careers service was good, but that it had been eroded by the Department for Education. One commentator actually said that it appeared that Michael Gove’s strategy of stonewalling John Hayes’s work had paid off, and that, in an act of extraordinary vandalism, a world-class young people’s service was being replaced in many places by whatever head teachers chose to offer, or nothing at all. Another commentator has said that the withdrawal of entitlement has not been well marketed. How do you feel about that?

Mr Hayes: We face challenges with respect to the careers service. We are going through a very significant transition. The case for change seems to me to be a very strong one. Connexions wasn’t always delivering what it should. It was actually too big an ask of Connexions for it to be able to offer advice on a whole range of lifestyle issues as well as to be an expert on careers. We know that its performance was patchy.

The performance of careers provision in schools was also patchy. I think that one survey for Edge, which was carried out by YouGov, revealed that teachers knew less about apprenticeships than any other qualification, apart from the Welsh baccalaureate. I have nothing against the Welsh baccalaureate, Chair, but none the less that is a cause for concern. The case for change was a strong one.

Last year, as you know, we rolled out the adult careers service, Next Step, which was originally envisaged by the previous Government, and we put in place, for the first time, an adult service. What we are now talking about is a very significant transition to an all-age service. That ambition, as you said, Ian, has been widely welcomed.

Let me just say a word about the progress that we have made, Chair. Forgive me for the length of the answer, but it is an important subject, as I know you agree. First, there is an unprecedented level of co-operation within the careers profession itself to establish a well-set range of professional standards, training and consequent accreditation. That has been led by the taskforce and the alliance, and informed by the work of Dame Ruth Silver who, as you know, was commissioned to produce a report with a series of recommendations, which we very largely accepted.

Q329 Chair: Minister, there is a risk that your answer becomes so long that we think that you are flannelling in the face of a difficult question, which I know could not be further from the truth. Could I bring you back to focusing on the service provided to young people, as opposed to the adult service, because that is what comes under the remit of this Committee, and that is what we’re particularly concerned about?

Mr Hayes: With respect, Chair, the work that has been done on professionalising the service will apply to young people and adults. The work that I am describing-in terms of the supply side, as it were-will have a universal benefit for people at school, through to people upskilling and reskilling. So, on the supply side, there is substantial progress. I can report to the Committee that by the autumn those standards will be in place. The profession tells me that it is well on target and on stream to bring the fruit of that unprecedented level of co-operation to bear.

In terms of the demand side, if I can put it in those terms, I have, as you know, written to local authorities to remind them of their continuing statutory responsibility to encourage participation. I have also notified schools that they should, from September-anticipating their statutory duty, which will come into force next year-put in place arrangements to provide good, independent careers advice and guidance.

Now it is true that schools will interpret that responsibility in a way that is best suited to their own young people, but none the less it is a statutory responsibility and they should take it seriously. Let me say again to the Committee, because I think it will want this assurance, that I take the unequivocal view that a properly managed school-and don’t forget that Ofsted will continue to look at management as a key element in judging whether a school is performing well or not-should have a management responsibility for all its statutory duties. That responsibility will include its new statutory duty in respect of advice and guidance. So, yes, it is a challenge and, yes, we are going through a big change, but I am absolutely confident that at the end of the process we will end up with a much better product than we have had before.

Q330 Ian Mearns: You have not really covered the issue of transition though, because we are losing careers advice professionals from the system now. You have referred to the responsibility of local authorities, but up and down the country local authorities are going through a terrible process of trying to rebalance their budgetary systems, and they have had the careers service put back on the map at the same time.

Will the Government take action against local authorities that they believe are failing in their statutory duty to encourage, enable or assist effective participation of young people in education or training? Young people have received independent advice and guidance. We do not want to go back to a situation that Malcolm Wicks described as being akin to pensions mis-selling, with careers advice returning to how it was in the 1980s and 1990s.

Mr Hayes: I have told local authorities that they have a statutory duty. The Government take statutory duties very seriously, as have previous Governments, and we will, of course, use necessary powers to ensure that they are fulfilled.

Q331 Chair: Other countries-New Zealand and others, I think-have passed the provision of careers advice down to individual institutions. Is that right? However, in all previous instances, they have passed a budget to those schools with which to provide the supposedly impartial service. What is there to make us believe that the system will work in this case when no such budget is being passed to schools?

Mr Hayes: Two things. First, remember that schools already spend money on careers advice and guidance. They do so patchily-some schools do it rather well; many do not do it well enough. So, given that they now have a duty to secure independent advice, they will have to make a judgment about how they use the resource that they have already allocated to the provision of careers advice in a new and fresh way.

Secondly, schools will be subject to the destination measures that Lord Hill has mentioned. It will be a very unwise school that does not take seriously the relationship between the advice it gives its learners, and their subsequent progress and the destinations they reach, because the new level of scrutiny, which is born of a new kind of information, will bring those outcomes into sharp focus.

Q332 Chair: Do you have anything to add, Lord Hill?

Lord Hill: Solely on the budget point. Over time, the pupil premium is precisely the stream of funding that one could be putting towards the development of individual targeted support for some of the most disadvantaged children, which underlines and supports the point of putting that responsibility on the schools.

Chair: Thank you both very much for giving evidence to us this morning.

Prepared 14th June 2011