§ Diana Organ (Forest of Dean)I am pleased to be able to deal with pay in the further education sector and the concerns and challenges facing that sector in Gloucestershire.
Education is a priority for the Government. They have made clear through their vision for lifelong learning that they want high-quality education to be made available to all who want it. Lifelong learning recognises the need for individuals to develop their potential, tackle social exclusion and equip local economies with the skills necessary to compete globally. A national framework has been put in place with the learning and skills councils working with the learning partnerships to provide diversity and the necessary provision to meet the needs of the customer.
The key provider in the agenda is the FE sector, which has 4 million students in 271 colleges—the numbers have more than doubled since 1992. If the sector is not properly resourced, funded and rewarded, we will not be able to deliver the Government's agenda and vision. For too long, further education has been the Cinderella of education. It is now time for her to have the dress and carriage and go to the ball In the past four years, the Government have put resources into the schools sector through initiatives such as nursery funding, the new deal for schools, money for books, the pay awards, the standards boards, the new threshold for teachers, the laptops for teachers and money going direct to head teachers. That has all had a major beneficial impact on raising standards.
There is more to education than school provision, however. Now in their second term, the Government must match that provision for the FE sector. Indeed, the funding and resources invested in the schools sector have only exacerbated the destructive differential between the two. The Government are aware of the serious long-term underfunding of the FE sector, which has affected levels of pay and rewards of college staff. They demonstrated that by awarding £300 million over three years for college lecturers' pay, which is the first time that colleges have had earmarked funding for pay. As I shall explain, however, that is not the solution to the problem.
Lecturers and staff in the FE sector deserve recognition and respect for their achievements. Pay is crucial for colleges to be able to recruit, reward and retain staff. The poor comparison between pay in the FE sector and schools damages morale in the sector. That has led to a recent national day of action by members of the National Association of Teachers in Further and Higher Education on 22 May and a lobby of Parliament on 3 July. During the day of action in May, I met local staff from the Royal Forest of Dean college. In June, I organised a meeting with Gloucestershire principals, chairs of governors, other Members of Parliament, trade unions such as UNISON and NATFHE—bodies from across the county—so that I could hear their concerns. Three Labour Members of Parliament attended and the Liberal Democrats sent a representative; the Tories are not interested.
292WH Most of the points that I make today arise from those two meetings. The picture that was presented at them to me was not a good one. It is clear that the demand for a fully funded flat-rate increase of £3,000 for all lecturers and managers is a valid start to closing the gap between lecturers and school teachers. College lecturers' pay is around 10 per cent. below that of a school teacher. Even if a lecturer in an FE college had received every pay increase agreed at national level since incorporation in 1993, that difference would still exist.
Many colleges have not received all the nationally agreed increases, however. Since 1993, colleges have been responsible for setting their own pay levels and awards, in line with local conditions, need and affordability. Unlike schools, colleges have to meet the cost of pay awards from existing resources. It is clear from data from the Department for Education and Skills that colleges' resources have been significantly reduced in the past five years and that the unit of resource will not be restored to the 1995–96 levels until next year. In fact, the money available per student in further education is actually expected to decrease by 4 per cent next year.
In the case of the Royal Forest of Dean college, lecturers have not received all the nationally agreed increases and their pay is now a further 5.8 per cent. behind. Yet the college is the local sixth form for the Forest of Dean and its teachers do the same work as sixth form teachers in other schools. Its results are excellent, placing it in the top 10 colleges nationally for A-level passes and making it the top non-selective sixth form A-level provider in Gloucestershire. At the Royal Forest of Dean college, a newly appointed, fully qualified teacher with a degree earns £16,423; that compares with nearly £18,000 for most new school teachers. The maximum that a fully qualified, experienced lecturer can earn at the college is £24,459—that is reached after 10 years—but teachers in local schools after nine years' experience can apply to cross the threshold and, if successful, gain access to a nine-point scale that exceeds £30,000.
The pay differential affects recruitment and retention of staff. Greg Smith, the principal of Gloucestershire college of arts and technology, said that there have been recruitment problems, particularly in maths, science, computing and engineering. Gloucestershire's economy is based on aerospace, engineering and manufacturing, with 23 per cent. of employment based on manufacturing and 35 per cent. in the forest. We face major skills shortages in those areas yet, only last year, a maths lecturer with 20 years' experience left the Royal Forest of Dean college to take up a post in a local school. His pay is higher, he has less responsibility, and he no longer has to teach evening sessions. Clearly, the pay discrepancies cannot continue.
There has not been a fully funded pay award to further education since incorporation in 1993. The teachers' pay initiative suggested by the Government is not the solution, as it represents only a 2 per cent. increase in the college pay bill for this year. The competition between schools and colleges was intense before the new system allowed so many school teachers to go through the threshold, and now it is even worse. The equivalent offer to the FE sector does nothing to bridge the gap: the money is guaranteed for only three 293WH years and is allocated to colleges in relation to student numbers and not the number of fully qualified, experienced staff who could stand to benefit.
The TPI provision allocation to the Royal Forest of Dean college for the first year is £73,000, which is less than £700 for every full-time member of staff who qualifies. There was a strong feeling at my meetings with the Gloucestershire colleges that TPI is not the solution as it is divisive, and that was deeply regretted by all.
Another way out of the problem is to go for growth. The amount of money per student, however, has not increased but gone down and is expected to fall by another 4 per cent. next year. In addition, Gloucestershire might not be able to attain growth. Participation is already high, and the county enjoys very low levels of unemployment, so it will be difficult to grow quickly to get extra money. The high participation rates achieved in Gloucestershire and the good state of the local economy are testimonies to the success of the FE sector. Surely, we should not penalise that success.
A representative of Stroud college told me that the number of full-time students drops year after year because so many young people are able to find work. They do not wish to do long courses but instead want to earn money and learn skills while working. What they demand are part-time vocational courses, which cost more to deliver than courses in the sixth form sector. In addition, it is difficult to recruit and retain lecturers with vocational experience in a rural area, and the possibility of growth in 16-to-19-year units is particularly difficult to achieve in Gloucestershire because there is a substantial competitive sixth form sector with a very high stay-on rate. It is estimated that only Cirencester college will be able to grow in the sector.
Many further education colleges in Gloucester serve wide, dispersed rural areas and that gives rise to particular problems of transport and access. Vocational courses and the upskilling of the work force must be done throughout the county and in small classes. Those classes are expensive and difficult to organise and deliver in rural colleges that are often small, as Stroud and the Royal Forest of Dean colleges are. Gloucestershire does not qualify for the educational maintenance allowance, which is only at the pilot stage in places such as Hereford, Devon and Cornwall. There is a case for Gloucestershire to receive it as well. Gloucestershire does not qualify for any special postcode funding either, but a special case should be made because of the sparsity of our large rural areas, our pockets of deprivation and the need to skill an engineering and manufacturing work force.
Further education colleges can draw down extra money, such as money for staff development and training, only by matched funding from challenge funds. That system is inflexible and Gloucestershire colleges do not believe that it is the answer, because they do not have many unqualified staff. The colleges recognise that the standards fund is useful and flexible in schools, but they regret that nothing comparable is available for FE colleges.
There are problems in recruiting and retaining support and administration staff, who are so vital to FE colleges. Colleges are unlike schools because they have 294WH a mix of students with a wide age range and deliver many different courses. Teaching times are not set between 9 am and 4 pm, but go on into the evening and Saturdays. That means that there is a bigger burden in further education than in schools on departments such as administration. We face double jeopardy, however. As we have low unemployment, colleges face intense competition from district and county councils and the public and private sectors for quality administration and support staff. In some colleges, it was reported that staff turnover in those departments was as high as 33 per cent. The other competitors can raise salaries—Cotswold district council talked about raising administration staff pay by 15 per cent. and then putting up the council tax. FE colleges cannot match such salary increases because they do not have the funding, so they lose out to other sectors on vital staff.
The colleges in Gloucestershire are proud of their achievements, and rightly so. They believe in and want to meet the Government's agenda, and work in partnership. They have confidence in the national Learning and Skills Council and are wholly supportive of the vision for lifelong learning. They want to demonstrate and deliver quality value-added post-16 education and will continue to work to achieve that. However, for too long the sector has not been flexibly and adequately funded. Staff pay has fallen behind and is uncompetitive and the solutions being offered will not close the gap.
The cost of further education is the same as in 1995, but the sector's productivity has increased by 40 per cent. It is successful and meets the targets set by Governments. Colleges in Gloucestershire have examined everything to reduce overheads and costs, including the sale of buildings, and making redundancies is now the only way to meet their budgets. The Government's vision and priority for education must address the fact that the FE sector has a recruitment, reward and retention problem. They must ensure that highly valued staff do not walk out the door and prevent us from delivering the vision of high quality education for all who want it. The Minister should come to Gloucestershire to listen to the concerns of the people I met in my June meeting. He should meet the principals, heads, staff and trade unions of all colleges in Gloucestershire to find a way forward out of their present difficulties.
§ The Parliamentary Under-Secretary of State for Education and Skills (John Healey)I listened with interest and empathy to the concerns of my hon. Friend the Member for Forest of Dean (Diana Organ). I warmly congratulate her on securing the debate about matters that she, the Government and I feel strongly about. I listened with empathy because, similarly to my hon. Friend's constituency, my constituency had a long—though now sadly past—association with the coal industry and my constituents, like hers, still cherish the opportunities that further education and training can bring.
I am pleased to respond because I have an early opportunity in my new post to place on record my appreciation of the work that teachers in further education colleges—not only in my hon. Friend's area of Gloucestershire but throughout the country—are 295WH doing to open up opportunities for people in the communities that they serve. As my hon. Friend said, further education colleges are key providers in that field.
I also pay tribute to the manner in which my hon. Friend champions her constituents and, especially, to the detailed work that she has done on the matter, which strikes me as an exemplar of how good constituency Members should operate. She has pulled together the principals, chairs, unions and the learning and skills council in Gloucester. I am glad that they welcome the Government's vision of lifelong learning and that they want to play a part in realising that vision. I will be pleased to meet my hon. Friend's delegation, either in Gloucestershire or in my Department, to do justice to the detail of her case.
I want to ensure that my hon. Friend understands the context in which we must view the concerns that colleges have raised with her, and I shall touch on the most relevant Government policy that is being put in place.
More than 4 million people are learning via further education and the Government recognise the commitment and dedication of the staff who deliver education and training. However, too much of the provision is patchy and the levels of learner recruitment, retention and achievement are too low in many areas. That is why we are committed to raising standards. Colleges have responded well. Standards of teaching and levels of achievement have substantially improved, although we must build on that improvement. Colleges will continue to be challenged and supported by the Government, the Learning and Skills Council and the independent inspection carried out by the Office for Standards in Education and the new adult learning inspectorate. We have charged the LSC with developing a strategy to raise standards. This year, that is backed with funding of £160 million in the new standards fund, which is double the sum that we invested last year.
On pay, the Further and Higher Education Act 1992 established an independent further education sector through the creation of independent corporations to provide further education and training. The governing bodies and principals of colleges are required to secure efficient and effective management of all their college's resources, expenditure, capital assets, equipment and staff. They are also required to conduct academic and financial affairs to balance their budgets. The appointment of local governors means that the needs of local people, local employers, the local community and the local economy can be better met.
Each college must settle the annual pay and conditions of its staff in the context of the overall resources that are available and, as my hon. Friend rightly said, local need and local conditions. Those are matters between employers and staff within the broad parameters of public sector pay policy.
To help colleges solve the retention and recruitment problems mentioned by my hon. Friend, to reward high calibre teaching staff and support the restoration of proper career development within the sector, starting this year and running over the next three years, we have made an additional £300 million available in the FE teaching pay initiative. I am disappointed to hear my hon. Friend describe that as divisive and not the answer to the sector's problems.
296WH I am also disappointed that the local colleges that she has spoken to dismiss the initiative. We expect more than two thirds of teachers in general FE colleges to qualify for payments of at least £1,000—in many cases, up to £2,000 a year. In addition, we expect 10 per cent. of such staff to secure the restored principal lecturer grade, which will carry an additional payment of up to £4,000 a year.
Alongside that initiative, sixth form colleges are offering a professional standards scheme with payments to experienced teachers. Both schemes are designed to encourage and reward eligible teachers on a par with the threshold payment scheme for school teachers. From April this year, all payments can be backdated to 1 April. No college need lose out even if it is slow off the mark in submitting a declaration of intent to the local LSC.
Colleges should be examining ways to restructure their pay systems to base promotion and rewards on competence, professional development and high quality teaching. The sector must seize both the opportunity and the extra funds that we have provided to improve staff pay. It has been wrongly suggested that there is a bureaucratic delay in getting the new money for pay to colleges, so I will make the position clear: colleges received their provisional allocations for this year's funding for pay in April.
Our discussions on implementation are continuing separately with sixth form colleges. The onus has been on all the other colleges to submit to the LSC a brief summary of their implementation plan for the FE teaching pay initiative. Three months on, less than 10 per cent. of colleges have done that. None of the five colleges mentioned by my hon. Friend that serve her county have done so either. Once colleges have sent in the information, they will receive their funding. I urge colleges to get on and complete their summaries, so that their lecturers can benefit from the extra funding that we are providing to reward their work.
My hon. Friend pointed out that the teacher's pay initiative funds have been spread across the FE sector this year in line with the allocation of core funding to colleges, or, as my hon. Friend described it, in line with student numbers. Our purpose, however, is to recognise the different retention and achievement rates in different colleges. Let me be clear: I will press ahead with plans to examine the scope for refining the TPI arrangements for next year in discussion with the learning and skills council and representatives of the colleges.
My hon. Friend made great play of the comparison between schools and the FE sector. Work is under way to ensure that the FE sector benefits from some of the initiatives already proposed for schools, such as golden hellos and help for new teachers working in shortage subjects to pay off their student loans. I am also conscious of the high proportion of part-time staff in the FE sector and I am considering ways to strengthen the teaching delivered by and support available to such staff.
Qualifications and training are as important as pay. I do not know whether my hon. Friend appreciates that, in many respects, an equivalent of the standards fund exists in the FE sector and I hope that it will have an impact similar to that which she acknowledged it had in schools. Of the £160 million that would be in the 297WH standards fund, £80 million will help new FE teachers to gain teaching qualifications and support existing college lecturers and teachers with continuous professional development. The extra money for standards is part of an increase of £527 million for FE in this year alone—a 12 per cent. real terms increase on the money available last year—and next year it will increase by a further 3 per cent., not decrease, as my hon. Friend suggested. That funding includes support for the introduction of the new FE pay arrangements, for new centres of vocational excellence in FE, for higher standards of teaching and learning and for a step change in capital investment, including in IT infrastructure.
Further education has been crying out for such resources after years of neglect. I am certain that the proposal will enable further education to support the extra students that we all want. During the debate, my hon. Friend forcefully pointed out the disparity in pay between some FE lecturers and teachers in schools. We are all well aware of the historic funding gap between schools and FE and how it opened even wider during the 1990s. We are pledged to increase funding and ensure upwards convergence. However, being realistic and honest, that can be achieved only in time. With the TPI for FE colleges and the professional standards payments scheme in sixth form colleges, we have made a start. I understand that the association colleges have offered a 3.7 per cent. general pay increase this year. I am bound to say that that, in combination with new schemes such as TPI, is one of the best outcomes in FE for years.
My hon. Friend also referred to individual colleges where nationally negotiated pay increases are not implemented in full. As I explained, it is for colleges to make such decisions in discussions and negotiations with their local work force representatives. They must operate within their budgets and make what I appreciate can be difficult decisions. As my hon. Friend said, those decisions are for her five local colleges. I understand the uncertainty that that can cause members of staff and students, especially in rural areas such as the Forest of Dean.
I end on a positive note about a powerful new player that the FE sector should regard as its ally, not its administrator. My hon. Friend paid tribute to the new Learning and Skills Council. Its creation in April is one of the most significant and far-reaching reforms ever enacted in the post-16 learning sector. For the first time in 100 years, the planning and funding of all post-compulsory learning outside higher education will be integrated. The local learning and skills council in my hon. Friend's constituency, in Gloucester, is central to our purpose and to ensuring that the needs of local learners, lecturers, staff, employers and communities are properly met.
§ Mr. George Stevenson (in the Chair)Order. As the Minister and the hon. Member concerned are present, we may start the next debate.