Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [HL]

Committee (1st Day)

Clause 1: Transfer of functions

Debate on whether Clause 1 should stand part of the Bill.

My Lords, I shall also probe whether Clauses 2 and 3 and Schedules 1 to 3 should stand part of the Bill.

At Second Reading, we heard about the importance of skills development to boost economic growth, the gaps that employers face in finding the skills they need to fill vacancies, the continuing complexity of the skills landscape, and the ambition of the Government to meet these challenges. At this point, I thank particularly the Learning and Work Institute and the Association of Colleges for their advice and their perspectives on the Bill. On these Benches, while we accept that the Government have a real commitment to address these issues, we also believe that they need to give Parliament and employers much greater clarity on their plans. The Bill is clear in the door that it closes—the abolition of IfATE—but is silent on the door it opens; that is, Skills England and its powers and accountability. We are left with an interregnum, with the Secretary of State holding all the powers of IfATE and a few more for good measure.

I will try also to explain the logic of my Amendments 32 and 33. Ideally, we would have liked to be debating a much clearer, more detailed Bill and have all the answers to the concerns expressed across the House at Second Reading. I note that in her closing remarks at Second Reading, the Minister committed to setting out the relationship between the Department for Education and Skills England in a publicly available format which will be updated periodically. Even the phrase “updated periodically” begs questions about the clarity and stability of roles and accountability. No doubt the Minister will give us further details on this today.

My amendments suggest solutions on a sliding scale. At one end, we are proposing to stick with the status quo through the stand part notices for Clauses 1 to 3 and the associated schedules; from there, to different degrees of independence and accountability for a new body called Skills England; to, finally, although not in this group of amendments, accepting the Government’s proposals, but with a clear and rigorous reporting requirement to Parliament. At this stage, these are probing amendments.

As we heard at Second Reading, there are genuine concerns about the transfer of IfATE’s powers to the Secretary of State, in terms of compromising the independence with which apprenticeships and wider technical qualifications, including T-levels, are accredited, and in diluting the voice of employers. These concerns are only amplified by later clauses which extend the powers of the Secretary of State beyond those of IfATE to prepare standards without employer input, and remove requirements for regular reviews of technical qualifications and third-party examination of standards. We will, of course, debate these points later in Committee.

The proposed creation of Skills England as an executive agency within the Department for Education, rather than as an independent statutory body, although not part of the Bill, has raised questions about both its autonomy and its effectiveness. More broadly, our stand part notices seek to elicit from the Minister explanations on the following points.

First, why does the Minister believe that this organisational change will be any more effective than the previous 12 changes in the past 50 years?

Secondly, the impact assessment set out that the Government had considered both keeping IfATE as an organisation separate from Skills England and expanding its powers to take on Skills England’s full set of powers. My Amendment 32 attempts to reintroduce this as an option for the Government to consider. It would create an executive agency of the department, which would be called Skills England, and would focus on wider skills strategy, as well as keeping IfATE as an independent body for the accreditation of technical education qualifications and for its other responsibilities.

That amendment has a lot in common with Amendment 21 in the names of the noble Lord, Lord Storey, and the noble Baroness, Lady Garden of Frognal, although Amendment 21 would not retain IfATE, as mine would. One can make the case that it is more coherent to have everything in one place, but one can also argue that Skills England has a huge brief and should focus on some of the more urgent priorities, leaving IfATE to continue its good work in setting up clear lines of communication.

It is hard to avoid the conclusions that the Government are knowingly diluting the voices of employers; that they want to have as much control as possible over these qualifications in future; and, importantly, that they are seeking to reorganise the structures to deliver skills reforms rather than getting on with “doing the doing”, which is much needed on the ground. The impact assessment sets out briefly the advantages of the Government’s chosen approach but says almost nothing about the drawbacks of losing an independent, employer-led organisation that the Government acknowledge does an excellent job. It would be most helpful if the Minister could explain in more detail the barriers to doing this and how His Majesty’s Government evaluated the shortcomings of this approach.

Moving along the sliding scale, I turn to Amendment 33, which aims to commit the Government to introducing a draft Bill that would create an independent arm’s-length body, to be called Skills England. I note that organisations such as the St Martin’s Group, which represents employers, training providers and awarding organisations, have been clear in their briefings that it is

“crucial that Skills England’s independence needs to be exerted in statute”.

Given the independence that this would create from the department, we have assumed that IfATE would no longer need to exist. I hope very much that this is something to which the Minister can respond positively.

In my Amendments 32 and 33, we stipulate that the chief executive of Skills England must report to the board of Skills England. It seems extraordinary to have to make this point but noble Lords may have noticed that the job description for the CEO of Skills England made no reference to the board; rather, they report to the relevant director-general in the department. Given the emphasis that the Minister put at Second Reading on the strength and operational independence of the Skills England board and its members, it seems a major drawback that the chief executive of the organisation, on whose board they sit, does not report to it. Could the Minister undertake to reconsider this?

Finally, I turn to my Amendment 42, which I tabled, as the French might say, “pour encourager”. I am hopeful that the Minister will take my other amendment seriously as a way of actively demonstrating her commitment to the independence of Skills England but, failing that, this amendment seeks to sunset this legislation and give the Government time to come back with a Bill that addresses the concerns that we heard at Second Reading—and that we will no doubt hear more of in Committee. I beg to move.

My Lords, I consider myself encouragée. We on these Benches have some sympathy with these wrecking amendments. We have never supported taking decision-making out of the hands of experts and into the hands of a Secretary of State, whoever he or she may be and however informed and enthusiastic he or she may be about colleges, further education, and technical and vocational qualifications. As I said at Second Reading—I do not apologise for repeating it—politicians are almost always university-educated and may have little understanding of or enthusiasm for the world of skills. I exempt our Minister from this because I know that she cares but, of course, there is no guarantee that she will not be replaced—not for some time, I hope—by a “here today, gone tomorrow” Minister with no knowledge of this sector. These posts do not last, as we all know.

I speak with some knowledge. In the coalition Government, I was appointed Minister for the Olympics and Sport, having never had any interest in sport in my life. At school, I was a fat little bespectacled nerd who was always chosen last for any team. But, given the portfolio, I spent days and weeks of my life learning all there was to know about rugby league—thanks to my noble friend Lord Addington—cricket, hockey and other unmentionables in order to give educated answers to questions. But that is not the same as having a lifelong enthusiasm, and, because Ministers have almost always been educated—surprisingly enough—and can display an astonishing academic superiority, they may look down on practical achievement, as I discovered when I worked in Michael Gove’s team.

We are disappointed, as we always thought of Labour as a party supportive of education in all its guises, yet it has brought forward the damaging VAT on independent schools Bill, which would make us the first country in the world, I believe, to tax education—shame on them—and now this damaging Bill to attack practical education. It is a sad day indeed. We are also bemused that this apparently is the skills Bill, yet there is no mention of skills in it. It might as well have been the flying fish Bill because there is no mention of flying fish either. Some of the amendments in this group try to remedy this, including Amendments 32 and 33 in the name of the noble Baroness, Lady Barran, which we broadly support.

My Lords, I start by reminding the Committee of my educational interests, in particular that I serve on Pearson’s qualification committee, which includes its oversight of BTEC and other technical and T-level qualifications. I apologise that I was not present at Second Reading, but I had to be elsewhere. I have a number of noble friends who would have liked to have been here today but unfortunately are unable to be, particularly my noble friends Lord Blunkett, Lord Watson and Lady Morris.

I listened carefully to the noble Baroness, Lady Barran, with all the considerable respect that I afford her and was reminded of the ill-fated Schools Bill. She is playing the same game that some of us played at her, with the stand part notices and trying to wipe clauses out, which we did successfully in the case of the Schools Bill. It is interesting to reflect on that, because there are a few lessons that the department perhaps needs to learn about introducing controversial Bills in the Lords. There is controversy, as we have heard from the noble Baroness, Lady Garden, who spoke more fruitily than I might have expected.

I am sorry.

Well, not fruity—more forthrightly than I would have expected. Is that better? There is some reflection to be had on that because if a House of Lords starter gets significantly amended, it is difficult to undo that anywhere else.

I also think some learning from the Schools Bill is necessary in respect of the Secretary of State taking on significant powers without really consulting or properly engaging and not having time to do that. In the case of the Schools Bill it was a trio of ex-Ministers—the noble Lords, Lord Nash, Lord Agnew and Lord Baker—who did for it. We do not have a trio of ex-Ministers trying to do for this Bill, so I hope that is a relief to my noble friend the Minister.

In this case, I think we are all completely sold on Skills England and on the need for a body that takes on the IfATE functions but also has high-level discussions and co-ordinates thinking across government and with employers, trade unions, the combined mayoral authorities and all those stakeholders, including the Migration Advisory Committee, in the industrial strategy and the regional industrial strategies. I think we are sold on that, so we want Skills England to be a powerful, substantial body.

The problem that some of us have with the Bill is that it feels like the second half is missing. The second half is the establishment of Skills England as a statutory body. There is a lot of merit in giving that status to the body, and to its chief executive and chair, to be able to work across Whitehall with other government departments and other Ministers, and with mayors, leaders of trade unions and substantial employer bodies. Being subsumed within a division of the Department for Education, not even accountable to the Permanent Secretary, and, as the noble Baroness said, with the CEO not accountable to the board, is problematic. The Minister needs to reflect on it.

Incidentally, my understanding is that if Skills England became an executive agency, the department would be the awarding body for T-levels. IfATE is the awarding body. Organisations such as Pearson and the other contractors do the work, but the certification is sent out by IfATE. It is a nightmare to imagine a government department becoming an awarding body for an examination such as T-levels. It fills me with a certain amount of disquiet.

There is some merit in Amendment 21, but that is arguing for an executive agency. My preference would be for something closer to Amendment 33 in respect of being clear that we want a statutory body. Those are just things for my noble friend the Minister to reflect on. I would encourage noble Lords to not move their amendments and allow the Minister time to reflect, but it is important that she hears all our views on how important it is to set up Skills England to succeed.

My Lords, I very much support the intention and aims underlying the Bill; namely, to create a new and more effective UK skills system, with Skills England at its heart, to replace the current system—if you can call it a system at all—which is complex, fragmented, lacking in clear measures of success, and failing to deliver the skills we need.

The King’s Speech spoke of a Skills England Bill and that promise is surely not met by a Bill which does not mention Skills England at all. It has required considerable ingenuity on the part of several noble Lords to produce amendments that do mention Skills England and are deemed to be in scope.

The Bill focuses entirely on abolishing IfATE and transferring its functions—not to Skills England but to the Secretary of State—but it says nothing about the role, status and powers of Skills England, to which presumably these functions will in due course be passed, nor, as other noble Lords have mentioned, about how Skills England will combine the essentially practical, administrative and awarding functions it inherits from IfATE with its much broader and important role of aligning the skills system with the aims of boosting growth and spreading opportunity.

I feel some sympathy for the amendments from the noble Baroness, Lady Barran, to remove Clauses 1 to 3 and their respective schedules, because they and other amendments address the fundamental issue of how Skills England is intended to work, how we are supposed to get there from here—I was interested in the point made by the noble Baroness about the interregnum—and what the transition plan is.

I would prefer Skills England to be a statutory body, with sufficient authority and independence to fulfil its vital mission across the numerous government departments and other bodies involved and to bring together the demand challenges that employers face with skills shortages and so forth, given that the education and training systems are not delivering the skills we need to meet that demand.

My Lords, I want to speak to the amendments tabled by my noble friend Lady Barran, raising the issues that arise from the fact that Skills England, for all the hype, is to all intents and purposes the DfE. As others have mentioned, it will not have a statutory basis of its own. It might have a grand name and have been billed heavily in advance by the Government, but it is not a non-departmental public body which would be legally separate from the department and staffed by public servants rather than civil servants; it will be created by simple administrative action rather than legal instrument, meaning that it is basically just the department.

Executive agencies, of which Skills England will be one, are units of central government, perhaps administratively distinct to some extent but remaining legally very much part of it. What does this mean in practice? In some ways, it could be good. Potentially, it means a shorter feedback loop into Ministers’ red boxes, where responsibility for overarching skills policy rightly resides—there will be no room for excuses; the buck will stop with the Secretary of State for Skills England’s performance; and there will be no excuses for any failure of Skills England to work successfully across government departments and to corral Treasury to fund our skills system appropriately. However, that is the upside and, to be honest, I think there is potentially rather more downside from this change, because it is a misdiagnosis of where priorities need to be right now.

A prerequisite for a successful skills system is a reasonable degree of stability and certainty necessary to get businesses to invest in training, and there is no doubt in anyone’s mind that our businesses are not investing enough in training their workforce—as we all know, we are spending less than half the OECD average. Instead, we have near-permanent policy churn in this area. Supposedly once-in-a-generation reforms take place nearly every Parliament, sometimes every other year, creating chronic instability in the policy framework for investment for skills.

My Lords, in rising to speak very briefly in this debate, I apologise for the fact that I was not at Second Reading. Most of the points that I sought to make have already been made. Therefore, I do not need to repeat them, save that I am sure that there is an absolute commitment in this Room that what we need is high-quality skills training and education and that no one would demur from that. The differences—or possibly the similarities—across the aisle are that we want to make sure that it is done effectively and as speedily as possible while ensuring it is done properly.

I am very sympathetic to the view expressed by my noble friend Lord Knight about the consideration that might be given to a statutory body. Some noble Lords who know my history may know that I have not always been a great fan of everything being held in the hands of the department or the Secretary of State—obviously, it depends on the Secretary of State. In this case, we can afford, if we to make a move, to think about making the appropriate move. From the discussions that I have had, it seems that the appropriate move from where we are would be to a statutory body, for all the reasons that a number of speakers have outlined. That may well confer a greater sense not just of stability but of consistency, which is where we need to be if we are to carry with us young people, their teachers, their parents and employers, who are all extremely concerned, and to ensure that we have excellent skills provision and skills acquisition in this country.

My Lords, I too apologise that I was unable to be at Second Reading, although I have read all the contributions made by noble Lords, including those here, at the time. I add my general support to pretty much everything that has been said, including on Amendments 21 and 33. I have considerable sympathy with the proposal to get rid of Schedule 1, and specifically with those noble Lords who have said that we really need a statutory body. Just putting everything inside the Department for Education in an extremely unclear way is really unsatisfactory.