I beg to move,
That leave be given to bring in a Bill to make provision for Institutes of Technology to apply to receive a Royal Charter; and for connected purposes.
At first blush, this might sound like a somewhat arcane issue involving an unlikely combination. The world of royal charters and the Privy Council approvals process may feel a million miles away from the new institute of technology agenda, but when I explain the reason for this proposal, then all should, and I hope will, become very clear.
One of the greatest challenges facing our country is the so-called skills gap—the shortfall between the demands of modern industry and business for suitably qualified entrants and the supply of people with those very qualifications. For too long, there was a dislocation between what our businesses actually needed and what was being provided educationally. A range of studies have identified the lack of people in our country with higher technical skills and the economy’s growing need for even more skilled technicians. Without change, productivity rates will slow or even fall, which means lower wages and an economy no longer at the cutting edge of innovation.
The policy response was, rightly, the creation of institutes of technology. IOTs are a new type of provider designed specifically to deliver the technical STEM—science, technology, engineering and maths—skills, mainly at levels 4 and 5, that employers and our economy need. Their main characteristic is a model of collaborative work involving partnerships between further education providers and higher education providers with a proven track record, and, vitally, employers, this time with employers right at the heart of decision making and the development and delivery of the curriculum.
Following a rigorous competition, 12 wave 1 IOTs were established, supported by £170 million of capital grant funding to invest in state-of-the-art equipment and facilities. My hon. Friend the Member for North Swindon (Justin Tomlinson) and I pushed the Department for Education hard for Swindon to be selected, and we were delighted when Swindon and Wiltshire Institute of Technology was announced as part of the first wave. It received capital funding of over £17 million and launched last year with a range of new courses based on both campuses in Swindon. My hon. Friend, with whom I have always worked as part of our joint team for Swindon, strongly supports this Bill too. As well as delivering against their own work programmes, I am glad to see that the IOTs are involved in the delivery of key initiatives in the 2021 skills for jobs White Paper, such as the skills accelerator, the in-work skills pilot, and the higher technical qualifications growth fund.
Our 2019 manifesto committed to introducing a further eight IOTs. The Department ran another competition, and I am glad to say that a further nine proposals have now been selected to become new IOTs. These are backed by an additional £120 million of capital grant funding, bringing the total to be invested in IOTs to £290 million. That will mean that there will be 21 IOTs across England comprising over 75 further education providers and 34 universities, and over 100 employers, including Microsoft, Nissan, Bosch, Babcock, Fujitsu and many more. They are delivering a wide range of technical courses in STEM sectors such as construction, advanced manufacturing, digital and cyber- security, agritech, aerospace, automotive engineering, healthcare and laboratory science. Being employer-led, IOTs can tailor their provision to react quickly to the current and evolving technical skills needs of employers in the areas that they serve. There might be a skills shortage in areas such as transport or in supporting the fourth industrial revolution, which requires new skills in artificial intelligence, data and innovative technologies. I believe that IOTs can help to plug that gap.