News analysis Learning the lessons from our skills shortage

30 Nov 06
What links climate change, transport, planning and health? Answer: they are some of the issues that Chancellor Gordon Brown has outsourced to expert, independent review.

01 December 2006

What links climate change, transport, planning and health? Answer: they are some of the issues that Chancellor Gordon Brown has outsourced to expert, independent review.

Skills is another area deemed by the Treasury to be of strategic importance to the UK, and thus hived off to a member of the great and the good to chew over for a couple of years.

Lord Sandy Leitch, chair of the National Employment Panel and a leading light in the financial services industry, has been heading the skills review since its establishment in 2004.

His mission is to consider the skills base the UK should aim to achieve in 2020 if it is to maximise growth, productivity and social justice and make attendant policy recommendations.

Leitch's final report is expected to be published alongside the Pre-Budget Report later this month. What it is likely to say, however, is cloaked in mystery, and further education experts are beginning to doubt that much of significance will emerge.

Leitch's interim report, published in April 2005, set out some stark conclusions. More than a third of adults of working age do not have a basic school-leaving qualification and 5 million adults have no qualifications at all.

Even if the government's challenging targets for 2020 are met, and increased numbers of people go on to achieve degrees and other qualifications, UK skills levels would still compare poorly in international terms, Leitch said, warning that this could undermine the country's long-term prosperity.

'The scale of the challenge is daunting,' he said. 'The UK must become world class on skills – for all our sakes.'

But the publication of the Further Education Bill on November 21 has led some commentators to suggest that the government is putting the cart before the horse: the Department for Education and Skills is busy reforming the FE sector before hearing Leitch's verdict on what should be done to improve the bigger picture.

Julian Gravatt, director of funding and development at the Association of Colleges, told Public Finance that it was difficult to anticipate Leitch's final recommendations as he is 'holding his cards quite close to his chest'.

'Leitch has the potential to be a radical approach,' Gravatt says. 'It is looking at further and higher education together across the whole of the UK rather than as devolved entities… The signal is that he will put basic skills quite high. What is unclear is how it's going to be paid for.'

Dan Taubman, a national officer at the University and College Union, is more pessimistic. 'It's going to be profoundly disappointing. There's not going to be much in it of substance. There will no doubt be more exhortation about the need for a step change, but where is this step change going to come from?'

The UCU has been pushing for statutory requirements on employers to train their workforces, but this is a nettle Leitch will not grasp, Taubman confidently predicts.

British industry has been muscling in on the debate. Last week, the CBI published a four-point plan outlining action that should be taken if the mismatch between the £3bn spent on training and the needs of employers is to be addressed.

'At present the skills system is failing to deliver,' CBI director general Richard Lambert said. 'Employers find much of the available publicly funded training irrelevant, and individuals are not offered the support they need.'

The CBI wants employers to design qualifications so that they reflect the skills they need. It adds that government funding should be channelled through the Train-to-Gain system – a new scheme that encourages employers to identify their skills needs and purchase their own training – rather than being parcelled out between FE colleges.

The FE sector has been unimpressed with the business lobby's contribution. 'The CBI is not talking about a sector that we recognise. It hasn't cottoned on to what is going on,' Gravatt says.

Even Education Secretary Alan Johnson expressed his disapproval at the AoC's annual conference in Birmingham last week. '[The CBI] didn't give us any credit at all for that improvement that's been made,' he told delegates during a question and answer session.

'Employers have a very real stake in this, but the debate ought to be conducted in a grown-up way, recognising the achievements that have been made and that no part in this debate is totally blameless for the situation we are in now.'

That the DfES does not necessarily want to wait for Leitch is evidenced by the publication of the FE Bill.

The Bill, which was broadly welcomed takes forward many of the recommendations outlined by Sir Andrew Foster in his review of FE in 2005. It allows colleges to award foundation degrees, and restructures and streamlines the Learning and Skills Council, the sector's funding body.

It also grants the LSC powers previously held by the secretary of state to intervene in failing colleges and order the dismissal of the principal.

The AoC is unhappy with this proposal, particularly given the improving performance of FE colleges, which was endorsed by Ofsted in its latest annual report.

Gravatt says: 'At the moment, a college might get into trouble and all sorts of things will happen and in some cases the principal will go. The Bill means the LSC will be empowered to tell governors to sack the principal, then employment law kicks in, which could hinder things actually getting done. The powers go beyond what powers local education authorities have to deal with head teachers.'

Dan Taubman of the UCU echoes this view. 'Why have we got all this hot air when the quality of colleges is going up?' he told PF.

With the Pre-Budget Report due to be published on December 6, there isn't long to wait to discover whether Leitch produces something more substantial than hot air.

UK skills — the current picture

Conclusions of Lord Leitch's interim report

  • Over a third of adults of working age do not have a basic school-leaving qualification
  • Five million adults have no qualifications at all
  • One in six adults do not have the literacy levels expected of an 11-year-old
  • Half of all adults do not have functional numeracy

Further Education and Training Bill

  • Creates a new power for FE institutions to award foundation degrees
  • Empowers the Learning and Skills Council to intervene in underperforming colleges
  • Reorganises the Learning and Skills Council from 47 local councils to nine regional ones
  • Ensures the Learning and Skills Council and colleges take account of the needs and views of employers and learners
  • Places a new duty on the Learning and Skills Council to encourage diversity of education and training and create greater opportunities for learners and employers to exercise choice in type, place and form of learning

PFdec2006

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