Further Education

HC Deb 14 May 2003 vol 405 cc101-22WH

2 pm

Mr. Deputy Speaker (Mr. Edward O'Hara)

This debate will last one and a half hours, and it may help hon. Members gauge their contributions if I say now that the first Front-Bench spokesman must be called no later than 3 o'clock.

Dr. Vincent Cable (Twickenham)

I appreciate the opportunity to introduce this debate. I chose the subject for a mixture of reasons—national, local and personal—as many hon. Members do.

Nationally, a great deal of controversy is building up about recent increases in funding for schools and higher education, but little has been said about the further education sector. I suspect that that is for two reasons. One is that the further education sector rarely attracts headlines, and the other is that the mood in that sector has changed. The Government made a big increase in grant awards last November, and ended 10 years of cuts and contraction. I will try to show that despite that, there are still considerable problems, and perhaps the change is not as impressive as it seems. None the less, the mood of frustration and anger that many of us encountered in recent years, with further education lecturers striking and so on, has certainly changed.

At local level, there are two further education colleges in Twickenham, and they are an important part of the local community. The Learning and Skills Council described the tertiary college, on the basis of its published results, as the top FE establishment in Greater London. The college is an outstanding institution, not just in conventional academic and vocational training qualification terms, but in terms of value added. An interesting experiment took place in which the performance of a cohort of 250 GCSE students who went to the tertiary college was compared to that of an equivalent cohort that went through the private sector and attended top private schools. It showed that the tertiary college significantly outperformed the private sector, and that there was real value added. The college is in a relatively affluent part of suburban London, but a high percentage of its intake comes from deprived parts of inner London, and from adjacent boroughs such as Hounslow and Baling, which have a high ethnic minority population. Its achievements are considerable.

The second institution is the adult education college. It is more difficult to measure performance in adult education, and it is hard to ensure that we are comparing like with like, but some assessments suggest that the college is one of the top colleges, if not the top college, in the country. It is certainly enormously appreciated locally. There are high participation rates, and it is greatly valued. The Minister will be familiar with it, as she recently visited its new business department.

I use the example of those colleges not simply to talk about them in a parochial sense but to test the impact of recent changes in funding. I will go through the arithmetic as it affects those colleges, because that makes the points more concrete arid real, but first I shall add a personal note. My father has been dead for 20 years, but in his time he was one of the leading figures in FE. He was one of those people who first worked on the shop floor, and then educated himself. He became an FE lecturer, trained two generations of people in York in the building trades, which included everything from bricklaying and stonemasonry to quantity surveying, and eventually became the national president of his trade union. He helped to introduce much of our training infrastructure in the late 1960s and early 1970s, including the block day release schemes, which have become somewhat battered over the years, but are none the less the foundation of FE. Among the things he taught me were the importance of further education for people who wanted to improve themselves but did not have the opportunity to go to university, and its critical importance for the skill base of, for example, the building industry. Those two things are as important now they were then.

The issue of funding is central. I shall take the arithmetic that the Government have given us at national level and apply that to the institutions I know, to try to tease out what it means. The headline was that the Government's three-year award was a 26 per cent, cash increase, which in real terms was estimated to be 19 per cent. The fact that that was a three-year settlement was an advance and a positive change; it will give greater certainty, which is important. In the coming academic year, 2003–04, that settlement amounts to a 10 per cent, cash increase, which is an increase of 7.5 per cent, in real terms. That is impressive, and has been regarded as such in the sector.

I discussed the numbers with the college principal, Eric Kirby, and his chief finance officer, Graham Try, whose analysis is all the more credible because he is chairman of the Chartered Institute of Public Finance and Accountancy, one of the leading organisations of public sector accountants in the country. They showed me that of that 7.5 per cent, real-terms increase, 2 per cent, goes towards the national teacher superannuation scheme, and 3.5 per cent, consolidates two existing pots of funds that were available last year, partly for teachers and partly for standards—that is not new money. A further 1 per cent, is for employers national insurance. The 7.5 per cent, increase cannot therefore meaningfully be described as additional real resources, because 6.5 per cent, is already spent. The increase is welcome, but it does not provide additional real money.

We are talking about a real increase of about 1 per cent., although even that description is flattering. Colleges must also account for their support staff pension fund, which is an additional obligation. There is also a rather technical accounting point—I do not fully understand it; perhaps the Minister can explain it—which is that the standards fund consolidation does not allow for an increase comparable to that in the last financial year. The estimate for the college, which was made by someone who is reputable and professional, was that it would end up with no real increase. In fact, things are slightly worse, because staff pay must be taken into account.

All hon. Members will know from the deputations that we have seen during the past few years, and from the strikes that took place in some of our colleges, that there has been cumulative enormous frustration among technical college lecturers. There are major shortages in certain skill areas where there is competition from the commercial private sector, and the salaries of many of the people teaching academic subjects lag considerably behind those of people teaching the same subject in schools. The maximum figure was 30 per cent.; even the official figures show more than 10 per cent.

Colleges are faced with a dilemma: either they award the lecturers 2.5 per cent., which is the inflation level built in to the award, in which case they will not solve the structural problem of pay, or they pay over the odds and face the need to make a real cut in services. I do not know how different colleges would deal with such a dilemma. The people whom I spoke to at the college were aware that it was in a serious predicament. Although that college is excellent and well managed, and is not thinking about laying off staff or affecting student welfare, it is going to neglect the maintenance of its building, which has already been condemned by Ofsted as totally unsatisfactory. People already have to make hard choices.

I also went to the other college that the Minister visited and I spoke to the principal, Christina Conroy, who is dynamic and successful. She took me through the arithmetic of her institution, where the position was even worse—the cost increase factors applied there as they did in the tertiary college. In addition, only half of that college's revenue comes from the Government. One of the problems for adult colleges is that a substantial part of their income is funded by adult community learning. My local college is seriously underfunded in that area, and it cannot escape because the Government have decided to freeze the allocations until 2008 because of the complexities of a new funding formula.

Adult colleges are trapped. Their only other source of income is to increase fees, but that will cause a dilemma for them. If they carry out market testing and make an increase of 5 per cent., they will lose a substantial number of pupils. There is a problem with the elasticity of demand; they will have to safeguard the interests of the vulnerable clients. There is a limited scope for fee increases. Adult colleges are faced—as tertiary colleges are, but in a different way—with cuts, not increases. I am having to explain to constituents why popular, albeit economically marginal courses are now having to be cut, when the Government have announced big headline increases in cash.

I have illustrated some of the problems suffered by the two colleges—and I stress that those are particularly well managed and successful colleges. I imagine that further down the food chain, with badly managed colleges in more difficulty, the consequences are much worse. I do not want to pretend that the crisis is enormous. I am not talking about redundancies or a critical financial situation, but I am stressing the fact that the expectations that were aroused are being deflated rapidly. One of the colleges described the situation most eloquently, saying that there had been a curve of constant cuts for more than a decade, which had now reached a plateau at a lower level. That is the environment in which the colleges have to operate.

I have several other specific points to make, the first of which concerns staff. I have already mentioned the dilemmas faced by many colleges, certainly in the southeast of England, including the part of outer London that I represent, where there are acute labour market difficulties. One of the changes, which is designed partly to counter the adverse labour market trends, is an improvement in inner London weighting for the part of London that I represent. It used to be 6 per cent., but it has now been increased to 12 per cent. That is a substantial and welcome improvement.

The problem is that the studies on which the Department based its formula suggest that to meet changes in the real costs of living and the market conditions in which people operate, particularly with housing, the figure would need to be about 16 to 20 per cent. We have the awkward problem that although the Government have taken a substantial step forward, the conditions perceived by those who work in the environment, and those who employ them, are deteriorating. I appreciate that it is difficult to meet expectations, but the position of staff, especially in high-inflation areas, is difficult, and that problem has not been solved by the current changes.

Many of the problems that I have described do not apply only to this year; they will apply next year too, because the same cost factors will exist. Colleges are emphasising that the funding that they attract in real terms is conditional. It is not automatic. They have to satisfy a variety of tests to receive something that amounts to between 0 and 3.5 per cent, in real terms. That makes sense up to a point, but it entails uncertainty and complexity.

One of the matters that I have been asked about is business links. In future, the Learning and Skills Council will evaluate colleges in terms of how successful they have been in employer engagement. In a general philosophical sense, I do not have a problem with that. Of course colleges must be economically useful; they must make themselves relevant to their local business community. I do not think that either of my two colleges has problems with that. They are active participants in a business club. They constantly hobnob with the local business networks. As the Minister knows, the business school is very much at the forefront of their minds. Anxiety is felt, however, about the fact that, certainly given the comments of the Secretary of State, the Government seem to believe that the further education sector is failing collectively in such areas.

The Government perhaps do not appreciate that one of the fundamental difficulties that the further education sector has in dealing with business is caused by the problems of small firms. What tends to happen in that sector is that there are employees who want to be trained and there are colleges who want to train them, but companies cannot release their work force because of the fundamental difficulties of releasing staff in a small company. It is important that colleges should not be punished by a crude indicator of business engagement. We look forward to the ideas that will come through in the skills exercise to be carried out imminently by the Government to show how they will address the problem of the small company and how we can obtain the release of staff in a way that meets the needs of employees, companies and colleges.

One of the positive changes taking place, of which there are many, relates to the gradual roll-out of the maintenance allowance for people aged between 16 and 19. There are growing numbers of teenagers who did not do particularly well at school, who now have the opportunity to do post-school advanced vocational qualifications—A-levels—with the help of maintenance allowances. That is a big step forward. As I understand it, the programme is being rolled out, and it would be useful to know at what pace that will happen.

The Foyer Foundation has carried out some interesting research that suggests the enormous potential of building on the concept of the maintenance allowance for people over 19 years old. I meet many people, particularly young mothers, who are trying to get back into the labour force through upgrading their qualifications and training. That would also apply to people who have been mentally ill and are trying to rebuild their lives, who have enormous difficulties with the benefits system, which will help them with employment-related benefits, but will not help them to retrain.

The Foyer Foundation suggests that if the maintenance allowance could be extended to that age group, that would give a very favourable economic cost-benefit ratio. I do not want to go into the technicalities, but there are suggestions that that would be a productive use of Government funding. It would be interesting to gauge the Government's reaction to that work.

In conclusion, I am grateful for the opportunity to introduce an important subject. This is not a crisis point in further education, but perhaps it is a good time to think about FE and take stock of the changes that have taken place in the light of the Government's new settlement last autumn. The fundamental problem remains that the FE sector is still in the shadow of higher education; sadly, it still does not have the same degree of status and impetus behind it. Part of my effort is to ensure that that situation is changed.

2.18pm

Mr. David Lepper (Brighton, Pavilion)

I begin by congratulating the hon. Member for Twickenham (Dr. Cable) on securing the debate. It is a little disappointing that there are not more hon. Members present to consider the important issues that the hon. Gentleman has raised about the funding of further education. My hon. Friend the Minister will know something of the variety of further education provision that exists in the city of Brighton and Hove, part of which represent. We are perhaps unusual in that we have a long-established FE college.

I am glad that the Minister was able to come down in November last year to open the refurbished and latest version of that college—City College Brighton and Hove. It was established in the late 19th century as one of the colleges funded by the tax on whisky, which was directed to increasing opportunities for those who might not otherwise have them. We also have two excellent and innovative sixth-form colleges—one in my constituency and one in the constituency of my hon. Friend the Member for Hove (Mr. Caplin). As a result of a historical accident in the Hove part of the city, we have secondary schools with their own sixth forms. Therefore we have a breadth of provision at that level.

My colleagues who represent the city of Brighton and Hove have made a point of regularly meeting representatives of all those institutions at least once a term. I can attest to the welcome that was given in November last year to my right hon. Friend the Secretary of State's announcement of the £1.2 billion increase over the next three years in funding for further education; the three-year funding system that is linked to performance agreement plans from each college and the extension of the educational maintenance allowance.

As I have said, there is a variety of provision in Brighton and Hove, and in the past that has presented problems. Last year, I corresponded with the Minister and drew her attention to some of the problems that can exist in capital funding when sixth-form colleges are governed by one regime, and schools with sixth forms by another. I thank her for the flexibility that both she and the officials in her Department showed in their discussions with the Learning and Skills Council nationally that led to a relaxation of some central Government funding restrictions to sixth-form colleges. We will wait to see what the impact of that will be on the colleges in my constituency, but it is a welcome move.

As the hon. Gentleman has said, the sector generally welcomed last year's changes with enthusiasm. John Brennan of the Association of Colleges, writing in the spring edition of FE Now!, describes it as "a major step forward". He refers to the 78 per cent, increase in cash terms, the 42 per cent, increase in real terms since 1996–97 and the increase both in cash and real terms of funding per student. He says in his article that

The 1990's nightmare of the efficiency squeeze has been replaced by a steadily improving funding picture". As the hon. Gentleman said, colleges are expressing worries about the impact on the funding announcement of factors such as employers' national insurance contributions, pension schemes, the effect of consolidation into core funding of allocations for pay, especially professional standards payments in sixth-form colleges, and the staff development component of the standards fund. Colleges are also expressing concerns about their ability to meet the participation targets of further education within the increased funding that is available, which they willingly embrace. I am sure that they will find ways of meeting them.

I understand that colleges have until August to set their budgets for the next year. I am sure that the Minister will be liaising with learning and skills councils throughout the country, as they in turn will be liaising with the colleges within their areas, so that we can ensure that, as we approach the August deadline, some of those problems in school funding that have hit the headlines recently do not occur in the further education sector as well. There is great enthusiasm, and I am sure that Ministers will be willing to listen to the reasonable approach that they will find coming from that sector, while welcoming the settlement announced last year.

There are some other concerns that affect sixth-form colleges in areas where there is variety of provision. These relate to the inequality of funding generally between sixth-form colleges and school sixth forms, and not only in respect of capital issues. I am glad that the Government are taking steps to reduce that inequality. The gap is likely to be down to about 5 per cent, in the near future, and we hope that further progress will be made. However, there is some concern on the part of colleges about what the impact will be on sixth-form colleges when funding for 16 plus is under the remit of learning and skills councils.

Before I leave this area of further education, I should like to put on record my family's debt of gratitude. The hon. Gentleman talked of his father's contribution to FE. My son, who is now an established journalist with a national magazine, received his initial training in journalism at City College Brighton and Hove. My daughter, having spent eight years as a poorly paid nursery nurse, went to Varndean college—a sixth-form college—to take an access course that gave her the opportunity to go to university. Such a debt of gratitude to our FE institutions is probably shared by families throughout the country.

The hon. Gentleman referred to the research undertaken by the Foyer Federation. I have the honour of chairing the friends of the Brighton and Hove foyer. Its role is to secure support from the community for that excellent institution; it is one of 120 foyers throughout the country. There are 50 spaces at the Brighton and Hove foyer, and all respect is due to the manager of the foyer, Sheila Hall, and her staff for their excellent work in providing stability to young people who have faced either real hardship—of a sort that we cannot imagine— or great instability and vulnerability in their lives up to the point when they arrive at the foyer.

The Brighton and Hove foyer caters for people with few, if any, formal qualifications. It gives people, as all foyers do, a second chance. They are young people who have reached the age of 17 or 18 and who have probably left school with no qualifications, or who may not have attended school for much of their last two or three years of formal education.

We all welcome the Government's aspiration to ensure that, by 2010, 90 per cent, of young people will have participated in a full-time programme fitting them for higher education or skilled employment by the age of 22. Foyers have an important role to play in helping to meet that target, as young people who attend often have not only left school with little in the way of formal education, but, because of that, are likely to drift into low-paid employment with little chance of training on the job. Research that is quoted in the Government's skills strategy progress report, published earlier this year, found that 22 per cent, of people with a degree or its equivalent who are in work are likely to receive continuing training opportunities; only 5 per cent, of those with no qualifications are likely to receive continuing training opportunities when they find work.

As the hon. Gentleman suggested, the problem is that at the age of 19 some of the excellent work that helps young people comes to an end because of changes in benefit rules, in particular access to housing benefit which comes into force at that age if the person is in full-time education—that is, studying for more than 16 hours a week.

I shall cite the cases of two people at the Brighton and Hove foyer. Mr. X came to live at the foyer when he was 18. He was doing a full-time media course at City college. Whatever might be said in some quarters about media courses, I remind hon. Members that my son found gainful employment through taking one at City college. After doing very well in his first year, Mr. X went back to college in the second year. However, as the course was full time, when he reached his 19th birthday, he had to move out of the foyer because his rent could no longer be paid by housing benefit. Therefore, the stability that underpinned his education success was being undermined.

The second case is that of Miss Y, who came to the foyer from a difficult family background. She was entitled to income support and full housing benefit because of her family circumstances. She was in year 2 of a full-time HNC course in design. However, when she reaches her 19th birthday, she will no longer be entitled to those benefits. Under the current rules, as her studies are not considered to be vocational, she will not be allowed to continue them. Unfortunately, as she is in full-time education, the housing benefit department will not pay her rent, even if she is no longer claiming benefits. The skilful work of the staff at the foyer, and the helpful offices of the local new deal team, ensured that that young woman was able to continue her education and remain at the foyer. Such successful cases often involve staff turning a blind eye to certain regulations, or engaging in a degree of subterfuge, to ensure that the youngsters can continue studying: that should not be necessary.

As the hon. Gentleman said, the Foyer Federation is proposing an extension of the education maintenance allowance, which the Government will be rolling out from 2004. I commend to my hon. Friend the Minister the submission from the federation, of which I am sure that she is aware. That submission is entitled "Second Chances", and is a response to the progress report on the skills strategy. It argues for an extension of the education allowance to people aged between 19 and 30 who are on courses leading to level 2 or 3 attainment. It would be a means-tested allowance, linked to attendance at, and completion of, those courses—so it would not offer something for nothing, but it would be tied to the study that the young people are doing. That— along with, perhaps, some change in housing benefit entitlement—would make a great difference to the life and education opportunities of some young people, many of whom are extremely vulnerable.

I hope that the Minister and her colleagues will carefully consider what the Foyer Federation has to say, and that they will discuss such matters with Ministers in the Department for Work and Pensions, because this is a cross-departmental issue. I believe that some announcements will arise from the skills strategy progress report that will be produced later this summer, and I look forward to seeing some acknowledgement of the Foyer Federation's findings in them.

The benefits that are to be gained will not be only for the young people themselves. Our economy will also benefit because there will be an increase in the skills base that underlies it, and an outlay at this stage will reduce the likelihood of later benefit dependency by those young people, because they will have been given a chance by the foyers, with their links to educational institutions.

I end by joining the hon. Gentleman in welcoming much of what the Government have done over the past few years, and particularly the announcement in November. The Government have set high targets and expectations for participation in full-time education, because they know that the opportunities for the rest of our lives are often governed by those educational opportunities. I welcome the progress that has been made, and look forward to the Minister's comments on the issues that are raised in the debate this afternoon.

2.34pm

Mr. John Horam (Orpington)

I thank the hon. Member for Twickenham (Dr. Cable) for raising this subject because I, too, believe it to be extremely important. I agree with the hon. Member for Brighton, Pavilion (Mr. Lepper), who spoke well and charmingly personally about his own and his family's experience, that we do well to debate the issue as often as we can in the House. I apologise to the hon. Member for Twickenham, to other hon. Members and to the Minister for the fact that I shall have to leave before the end of the debate, because I have to chair a Select Committee. That is one of the consequences of the new sitting hours. I put it on record, however, that I support the new hours, even if they do cause the occasional inconvenience.

The hon. Gentleman said that Richmond upon Thames college was the highest performer in the London area, and that is indeed the case. He may like to know that Orpington is ranked No. 2 out of the further education colleges. Moreover, Richmond upon Thames college is a tertiary college, and is therefore in a different category from Orpington, so Orpington is really the No. 1 when it comes to straight further education colleges. However, I will not pursue that further, as they are both very good colleges. Orpington college has received a string of awards, most recently for its basic skills training, for which it received a quality mark. It is a brilliant college and we are proud to have it in the London borough of Bromley, and in particular in Orpington.

I recognise the value of the new funding package that the Government put in place last November, and would not like anything that I am about to say to detract from my appreciation of that. However, I shall make several general points about how the situation is working out. The Minister will be aware that the Association of Colleges has made the point that qualifications are often inflexible rather than modular, and that the funding that colleges receive is often linked to students completing their qualifications. In practice, that means that colleges are inhibited from offering employers and students the learning that they want.

The Minister will also be aware of the excellent early-day motion tabled by the hon. Member for Bury, North (Mr. Chaytor), who I know takes an active interest in further education issues. That early-day motion urges the Department for Education and Skills, the Qualifications and Curriculum Authority and the Learning and Skills Council to implement proposals in the interim skills strategy which … give colleges greater ability to develop bespoke"— I emphasise the word "bespoke"—

training and flexible qualifications with simplified assessment systems so that they can equip more individual learners and employers with the skills they need in the modern economy. That is the heart of the matter; we need flexibility and a more bespoke approach.

I mentioned that Orpington college is remarkable for its emphasis on basic skills and its basic skills strategy. However, as the hon. Member for Twickenham mentioned, there are some problems in that area arising from the reluctance of businesses to identify staff who are in need of support, or to give time to it, because they fear that, as a consequence, they will lose staff or may have to pay them more because of the increased qualifications gained. I wonder, therefore, whether the Government could find ways of rewarding employers if they engage staff in accredited training, and simultaneously reward colleges, in funding terms, for delivering a better work force.

My next point is a familiar one, but still valid, and one that weighs heavily on the principals of further education colleges. It concerns the excessive bureaucracy that accompanies much of the funding. The way in which colleges are expected to bid for additional project money, and the constant auditing of how resources are spent, create huge additional costs. I am aware that the Government have made a commitment to reduce such bureaucracy in many areas, including education, but on the ground floor there is little evidence of it happening. That is a problem for FE colleges that are trying to work the new systems.

Finally, I wish to raise the question of the starter home initiative. I raised that issue in a previous debate on further education in this Chamber some time ago—

2.40 pm

Sitting suspended for a Division in the House.

2.55 pm

On resuming—

Mr. Deputy Speaker

Fifteen minutes' injury time will be added on.

Mr. Horam

We all have some difficulties with Divisions in the middle of debates; I am sure the Minister feels the same as we all do. I shall recap my point about the starter homes initiative. Lecturers at further education colleges cannot participate in the scheme, whereas teachers can. The Minister is a London MP, as I am, and she will be aware that this is a particular disadvantage in London and the southeastern area, where housing is such a problem.

She will know that I raised the matter the last time we discussed further education in Westminster Hall. Indeed, she interrupted my speech to say that the problem had been sorted out. Sadly, it has not. She may recall a flurry of correspondence on the subject between her Department, the Office of the Deputy Prime Minister and myself, in which she finally agreed that FE lecturers did not qualify for the starter homes initiative. The latest word that I had—I do not know whether she was copied in to this correspondence—was from the Under-Secretary of State, Office of the Deputy Prime Minister, the hon. Member for Harrow, East (Mr. McNulty) on 16 April this year. He said:

The Starter Home Initiative (SHI) is jointly run by the Office of the Deputy Prime Minister and the Housing Corporation, and funded centrally by ODPM … The Corporation expects to hold a bidding round for key worker and other affordable housing schemes in the autumn this year. We are in the early stages of drawing up the details of our approach, in consultation with the Housing Corporation and other Government Departments, including DfES. As part of this work, consideration is being given to the eligibility of key worker groups for housing assistance from April 2004". In conclusion, I ask the Minister to look into that matter and, as a departmental Minister with responsibility for further education, to do her best to promote the case of further education lecturers to be included in the starter homes scheme.

2.57 pm

Linda Gilroy (Plymouth, Sutton)

Before I begin my speech, Mr. Deputy Speaker, may I ask when the summing-up speeches will start?

Mr. Deputy Speaker

We have added 15 minutes on, so the first Front-Bench spokesman will be called at 3.15 rather than 3 o'clock.

Linda Gilroy

Thank you, Mr. Deputy Speaker.

I welcome the opportunity for this debate, and congratulate the hon. Member for Twickenham (Dr. Cable) on obtaining one of these much-prized opportunities. I shall reflect on the wider context of the contribution that FE makes in the south-west region before turning to the further education sector in Plymouth. In the south-west region as many as 416,000 people are studying in further education—one in seven adults of working age. The majority—some 330,000— are studying part-time, but just over 70,000 are either 16 to 19-year-olds on full-time A-level, AVCE or GNQ courses, or studying HND/HNC in further education establishments.

Colleges are key to the regional economy and to raising the skills level. They produce an ad ded value of some £660 million in our region, and something like 21,000 jobs over and above those directly in the sector. I think that in Plymouth, about 4,000 people are in full-time further education, and about 20,000 part-time students from Plymouth and the surrounding area are studying in Plymouth.

Two of the leading establishments are Plymouth college of further education, which is predominantly sited in my constituency of Plymouth, Sutton, and Plymouth college of art and design. Both play an important part in the life of the city, and in changing a community that has seen the decline of a traditional industry—the defence sector—into a community in which new sectors require people to be trained through further education. In particular, the colleges have been the key to preparation for call centre work and tourism, and, indeed, the groundwork—basic skills.

We have particularly high levels of need for basic skills education; there are low levels of adult literacy and numeracy in the city. I shall return to that issue shortly. The colleges play a critical role in achieving access for people from some of the poorest communities in our city and the surrounding areas, particularly those who have no tradition of higher education in their backgrounds. The links that the further education sector provides between people in such circumstances and the possibility of higher education are critical.

I greatly welcome, therefore, the largest ever investment programme in further education, which represents a vote of confidence in the colleges. I particularly welcome the fact that all hon. Members here have recognised that that involves a significant increase, even if it also involves challenges for those setting the budgets of the further education sector, as hon. Members have taken the time to outline. The £1.2 billion extra going into the sector means a real terms increase of some 19 per cent, over the next three years. Certainty comes with knowing that we have a three-year increase. That will be helpful, because what people in the colleges want most is stability and simplicity.

I hope that my hon. Friend the Minister can assure us that everything possible will be done to reduce to a minimum the significant shifts that result from technical changes in funding rules, and the audit problems that the hon. Gentleman outlined. Those shifts may happen after courses have been provided and resources have been dedicated to running them, and that can create difficulties.

The hon. Member for Orpington (Mr. Horam) referred to the need to be able to align the investment with flexibility in courses. Plymouth college of art and design, a big and important institution, is now one of only a handful of specialist art colleges in the country. In welcoming the skills strategy, it wrote to me:

Too often, qualifications are inflexible rather than modular and too often the funding which comes to colleges is linked to students completing whole qualifications. In practice this means that we are inhibited from offering employers and students the learning they want. I hope that the Minister can assure hon. Members that every encouragement and incentive will be given to colleges to use the additional funding to close the gap between the pay and conditions of lecturers and teachers who do similar work. Every hon. Member has probably been lobbied about that. A significant number of teaching posts as well as student places and additional jobs are created through the further education sector.

I hope that my hon. Friend the Minister can assure me that the work that further education colleges do to improve access to higher education continues, particularly for those from the least advantaged communities, which I have mentioned. I hope that she will join me in congratulating Plymouth college of further education and the local foyer. Hon. Members have referred to the foyer campaign, and I believe that my own college and foyer have just received a beacon award from my hon. Friend at Westminster today. Others attended the ceremony, but unfortunately I could not be there as I was chairing a meeting of our Cooperative group of MPs. I understand that the college and the foyer have just been recognised for achieving excellence in improving access for some vulnerable young people—which other hon. Members have also spoken about. The Minister probably heard about that in the citation.

The partnership between the Plymouth foyer and Plymouth college of further education has sought to provide residents with the opportunity to gain formal accreditation for the personal development targets that they have achieved. The programme was developed to broaden key skills, work with others, and improve learning performance and problem solving. A tutor from the college, key workers and support staff identified potential students and worked with them on the compilation of folders of evidence.

Some 10 residents enrolled on the programme. It is interesting to examine the outcomes that the programme achieved: increasing confidence and refreshing skills learned at school that some people might have forgotten. Of the 10 participants, two enrolled on an access to higher education course at the college, one is doing a GNVQ in health and social care, one is doing A-levels, and another has entered the employment market. That is a laudable outcome, given that the participants were so vulnerable and had some of the greatest barriers and hurdles to surmount.

I hope that others have commended the further education maintenance allowance proposal submitted by the Foyer Federation. Last week I attended a meeting hosted by the Chairman of the Broadcasting Committee, my hon. Friend the Member for Brighton, Pavilion (Mr. Lepper), and was very taken with the contribution that the proposal could make to constituents living in the foyer in Plymouth and to a wide range of other young people.

Mention was made of the need to persuade my right hon. and hon. Friends in the Department of Work and Pensions, as well as my hon. Friend the Minister here today, of that. However, we will probably have to persuade the Treasury in the end, as the proposal carries a large price tag. If piloting is being considered to show that the foyers' suggestions can add value to the economy as well as to individuals, I can think of no better place for it than Devon and Cornwall, where a network of foyers operates under the Devon and Cornwall housing association. The Minister might like to consider that suggestion. Plymouth and the southwest have a good record. The Minister may recollect the success that we made of the Connexions pilot and the robust results that we achieved, so if she wants an ally when she goes to the Treasury about such matters, she should look west.

General work is being done to enable people who aspire to university education for the first time to develop the building blocks that lie in between them and it. Such work is important in a city such as Plymouth. I hope that the Minister can assure me that it will continue, and that she will do everything that she can to highlight the damage that the plans that the Conservative party announced yesterday could do to young people, such as those whom the Plymouth project seeks to help. I hope that she will ensure that everyone knows that the Conservatives' plans will limit the number of higher education places available to young people, and that they will be bad for an economy such as Plymouth's, where there are whole swathes of households that have never aspired to higher education.

Other countries already have far larger proportions of their young people going into higher education, and that affects not just our ability to compete as a city economy, but our ability as a country to compete internationally. Other hon. Members outlined in significant detail the challenges that face those who draw up the further education budgets. I am sure that my hon. Friend is already aware of some of those. I look forward to hearing her concluding remarks, and I hope that she can offer some of the assurances that I have sought.

3.10pm

Mr. David Rendel (Newbury)

For reasons that I hope to expand on in a moment, further education is certainly worth funding properly. It is in the Government's interests to do so if they are serious about expanding the educational opportunities available to us all, particularly those opportunities that are available to those who in traditional terms have perhaps not enjoyed any education beyond 16. My hon. Friend the Member for Twickenham (Dr. Cable) is therefore to be congratulated on securing this important debate. Politicians have not been talking about FE nearly enough.

For a very long time, FE colleges have been the Cinderella service of our education and skills system: under-recognised, undervalued, and underfunded. That is extraordinary given that FE involves twice as many students as there are in higher education. Part of the trouble is that two-thirds of FE students are part-timers and that is one of the causes for their low priority in Government thinking. That is quite absurd. There is no reason to suppose that a course is any less valid because it is spread over a longer period and studied on a part-time basis.

England's 400 FE colleges are responsible for nearly 4 million students. That is nearly one in 10 of our population. They are studying for 17,000 different qualifications. In fact, FE is and must be central to the Government's entire education and skills agenda. It is central to opening up vocational learning opportunities for 14 to 16-year-olds. It is central to academic and vocational opportunities for 16 to 19-year-olds. It is central to adult learning and skills. FE is central to assisting people to achieve the qualifications that they need to enter higher education, as well as being a direct provider of higher education. It is not difficult to see that the sector is crucial not only to the Government's aim of widening participation in education but to the wider strategies aimed at tackling social exclusion, unemployment, skills shortages and prisoner reoffending—a subject to which I intend to return shortly.

We are talking about a student intake drawn in large part from the very groups for whom the Government want to expand such opportunities. Indeed, 27 per cent, of college students come from the most deprived 15 per cent, of all local government wards. To give credit where credit is due—something that hon. Members may think I do all too seldom—in last year's comprehensive spending review, there was at long last some recognition by the Government that the FE sector requires more money, as my hon. Friend pointed out. Although the Secretary of State talks in terms of a 19 per cent, real-terms increase in funding over the three years to 2005–06, funding per student will rise by only 5 per cent, over that period. Most colleges are receiving increases this year that will just about keep pace with inflation, but little more.

Sadly, that is in the context of an overall decline in unit funding over the last decade. Between 1993–94 and 1998–99, real terms funding per student in further education fell year on year and by 14 per cent, overall—from £3,910 to £3,350. Recent funding settlements have merely halted this trend. They have not put it significantly into reverse. There has been a 70 per cent, increase in the number of students in the FE sector over the past five years. Unfortunately, as in our higher education sector, funding has not kept pace with the rise in the number of students. Like our schools, colleges also face extra costs such as the rise in national insurance and pensions contributions and increased pay for teaching staff.

Furthermore, the new money has come with strings attached. In his speech to the Association of Colleges annual conference in Birmingham on 19 November 2002, the Secretary of State announced that the investment would be tied to a new system of targets and performance management … designed to deliver the Prime Minister's four key principles of public sector reform". He said that the resources will be allocated on the basis of a performance contract with each college based on the following: increasing customer focus, with targets for student numbers and employer engagement; providing high quality teaching and learning, with a target for learner success rates; and improving the capability of the college workforce, with a target for professional qualifications for teachers. It is ironic to say the least that one of the Prime Minister's key principles of public sector reform as outlined by the Secretary of State is to promote devolution and delegation to the front line". There is an obvious contradiction between that principle and the targets regime announced in the very next sentence. One target is to reduce bureaucracy—only new Labour could institute a centrally imposed target with the aim of reducing bureaucracy. If that is not a contradiction in terms, I do not know what is.

On the subject of bureaucracy, will the Minister act on the unnecessary bureaucracy introduced by at least some of the local learning and skills councils? They vary in how they deal with what they require of their local colleges, but there are horrific tales of colleges having to account for spending down to the last paperclip and of learning and skills councils failing to inform colleges in good time about their budget for the following year, apparently in the expectation that colleges can simply raise or cut staff levels at the stroke of a pen, even in the middle of the academic year.

The Government must also do something about the many separate funding streams through which colleges receive their finances. A typical college has about 30 different funding streams. Far too much money is stuck in specific pots, all of which require separate applications. I suspect that someone will soon start a further education course in how to apply for money to run FE courses.

I turn now to just one illustration of the work that colleges and the FE sector in general can do. It is a demonstration both of the vital part that FE services play in our society and of why the funding question is so important. A recent investigation by the Public Accounts Committee, on which I sat, highlighted the role that education plays, and could play, in reducing prisoner reoffending. In fact, the Prison Service told us that investment in education to help offenders secure jobs after their release would be the single action most likely to affect reoffending.

In response to my questions, the then director general of the Prison Service, Mr. Martin Narey, told us that education can reduce reoffending by 10 to 14 per cent. annually. He said that the return from investment "would be dramatic" but that not enough money is going into the system. As a consequence, he said that, with the exception of the under-17 age group, I do not believe I am doing much more than playing at the edges". The implications of that analysis, at a time when record numbers of people are behind bars and our prisons are struggling to cope, should be clear to all: the financial cost of providing at least some basic education to those in prison is far outweighed by the cost of locking them away for a second stretch.

It is never easy, and it is certainly not popular, to call for more spending on those in prison, and I suspect that I do so at some risk. It is all too easy for the tabloids to say, "If there's enough money to spend on offenders, why can't we have enough money for our schools and those who have not offended?" However, it is an area of policy in which politicians will just have to defy the tabloids. We must point out that prison education is hugely cost effective not only in helping prisoners to become productive members of society, but in reducing the costs of crime, both financial and social.

I shall turn to the dramatic new Conservative policy announced yesterday. The Conservative press release, of which the hon. Member for Daventry (Mr. Boswell) will be well aware, states that the Government's 50 per cent, higher education participation target forces too many young people onto unsuitable courses when they would benefit more from high-level vocational qualifications. For a party that says that it believes in choice, one might suppose that such a decision is for the individual student rather than the shadow Secretary of State for Education and Skills. Leaving that aside, where will the money come from for the roughly 400,000 extra places on vocational courses that the policy implies? The Conservatives are hoping to use all the money that they save from taking people out of universities to pay for the abolition of tuition fees, but they have not told us where they will find the extra money for all the extra vocational courses.

Colleges already face real problems with the recruitment of teaching staff because salaries are so uncompetitive, as other Members have said. If the Conservatives are serious about providing more courses to train people to be plumbers and carpenters—as their leader said yesterday—they will need to find the money to pay for more tutors. The salaries will have to be competitive enough to attract people who at the moment can earn far more on the job—more, in most cases, than MPs earn. The truth is that the Conservatives are nostalgic for the old days when a university education was the preserve of a privileged few. There will be fewer places and less support for students from non-traditional backgrounds in higher education, and no commitment to additional resources to help those who prefer vocational courses in FE instead.

To return to the Government, the reality is that they have no coherent vision for the role of the FE sector in our education and skills system. As I said at the outset, it is arguable whether the Government's aim of widening participation in this sector will be met at all. Some 11 per cent, of degrees already come from FE colleges. There seems little recognition from the Government, however, of the huge role that FE is ideally placed to play in expanding the educational opportunities available to us all. That is reflected in the discrepancy between funding for colleges and funding for school sixth forms; between the support offered to part-time students and that offered to full-time students; and between the different levels of support students can expect depending on whether they opt for the FE or the HE route.

In addition to well funded FE colleges, we need to support students in FE. We welcome the Government's decision to introduce education and maintenance allowances for 16 to 19-year-olds. However, the time has come, as has been said in relation to the foyer movement, to develop a comprehensive system of student support for adult FE students. It is interesting to note that we spend in excess of £2.2 billion a year on student support for full-time higher education students, but barely a tenth of that amount on full-time and part-time adult FE students. That is despite the fact that the FE sector has twice as many students. Those inconsistencies are indicative of a Government who, after six years in office, continue to lack a coherent sense of direction for the FE sector. That failure undermines the Government's strategy for 14 to 19-year-olds, their higher education strategy, and their adult learning strategy. It also points to a continued failure to recognise the immense value of the FE sector to society as a whole. Our FE colleges are a vital resource, and we should support them.

3.23 pm

Mr. Tim Boswell (Daventry)

It is a privilege to participate in this debate, and I congratulate the hon. Member for Twickenham (Dr. Cable) on opening it in such an appropriate manner. When we debate further education in this place, we find that so few people are committed to it that, in one sense at least, those who are so committed are all hon. Friends, and their concern should be that so many people do not pay as much attention to the subject as they should. That is the spirit in which the contributions of the hon. Gentleman who introduced the debate and those of other hon. Members have been made. It is true of the interesting comments by the hon. Member for Brighton, Pavilion (Mr. Lepper) on progression, and those by my hon. Friend the Member for Orpington (Mr. Horam) about the particular problems faced by his local college— incidentally, I am aware of those problems having visited that college, as well as that in the constituency of the hon. Member for Twickenham.

It was interesting to see so many participants in the beacon awards. One is familiar with those because they have been given to leading and outstanding colleges. It was also a particular pleasure to see the local college of the hon. Member for Plymouth, Sutton (Linda Gilroy) receive the award from the Minister, not least because its principal was exported from Northampton, which is adjacent to my constituency. There is a lot of good in further education—that is perhaps the most important thing that we can say.

In case the hon. Member for Newbury (Mr. Rendel), who speaks for the Liberal Democrats, feels left out, I wish to say that I agree with his remarks about bureaucracy and about prison education, and want to associate myself with them.

The hon. Member for Plymouth, Sutton caused me to lift one eyebrow because in talking about Conservative proposals—which I do not intend to do at length today, because time does not permit it—she assumed that all post-16 activity would need to be conducted in higher education. It is clear from other remarks that she made that that is not the case. However, the hon. Member for Newbury implied that under our proposals, things would be like that.

Linda Gilroy

May I clarify the point that I made? I was stressing the importance of the FE sector in stretching the imaginations of people who do not aspire to higher education. If the numbers in higher education are restricted, the incentives that encourage people to go in that direction will be significantly diminished—and there are a range of other associated issues.

Mr. Boswell

I am grateful to the hon. Lady for clarifying that. However, her argument is somewhat numinous. I would prefer to see proper provision of proper educational instruction in training and in skills that have a practical end result, rather than hopeing that the problems of further education will be solved at one remove through the higher education sector.

Briefly—because it would take too long if we were to draw out these matters—I turn to the attacks of the hon. Member for Newbury on policies that have at least some resemblance to his own. I will not debate that similarity now, but I say to him, with respect, that he should not be worried about Conservatives wishing to go back to the metaphorical dark ages, because it was under a Conservative Government—indeed, it was largely under the Administration of Baroness Thatcher—that the proportion of young people in higher education rose from 8 to approximately 30 per cent. So we will hear no more of that.

On the skills agenda more generally, I will make a contribution tomorrow, if I manage to catch Mr. Speaker's eye, so I shall confine my current comments to the subject of further education funding and related matters. My hon. Friend the Member for Orpington had to leave the debate early to chair a Committee, but he made a distinguished contribution before he left, and I agree with him that this is a better settlement for further education than a couple of the past settlements. That is clearly true, so why argue about it? This is what we must now say to the Minister: whereas in the past we have had new Labour rhetoric unsupported by funding, on this occasion it is accompanied with a measure of funding, and that is at least some advance, but the key questions are about where we go with that and how far it will take us.

The hon. Member for Twickenham used his forensic skills to make the following point very well, and he had more time than I to do so. Clearly, it is possible to deconstruct the Government's inflated figures of what will be available by 2006. First, there is the issue of inflation. Secondly, there is the fact that this comes through over a period of three years, and in year one there will be no increase above inflation. There are also the increases in costs: in national insurance contributions, which alone account for £25 million in the sector, in pensions, and in pay, which has already been referred to. There is a need to keep pay broadly aligned with that of schoolteachers, and there are also further developments to come involving technicians' pay, which are welcome and necessary.

In itself, widening participation and increasing the effort and outreach entails further costs. The greater load will be carried by new enrolments. The assessment by the Association of Colleges suggests that there will be an overall increase of some 5 per cent, for students. To put it another way, most colleges will receive an extra 2.5 per cent, both in 2004–05 and in 2005–06, and that, of course, adds up to 5 per cent. A small number will receive 1 per cent, more than that in both years, for outstanding performance. However, those are conditional receipts, and are not yet actual receipts. I am sure that the Minister would wish to argue that that is proper. As the hon. Gentleman said, the guts of the matter is that in the real-life college situation, there may be no increase at all. That is better than a diminution, but it does not add up to a whole strategy.

One of the points that I want to make refers back to our brief exchanges on higher education. As the Association of Colleges points out, some of the figures for expansion, such as the proposed 11 per cent, increase in enrolment, depend on participation in foundation degrees. I am not here to rubbish such degrees. However, top-up fees may become a deterrent in themselves, and a far greater one than what I described to the hon. Member for Plymouth, Sutton as the somewhat numinous advantages of the availability of mass higher education on the scale that she envisages.

In any case, there are already real pressures on adult enrolment. Adults are excluded from modern apprenticeships, for example. No extra money is available to take on additional adults at the moment. In a press release that I quickly scooped up during the last Division interval, the association refers to difficulties with access at level 3. That is part of cutting off natural progression; we should be repairing historic skills deficits in cities that are comparatively disadvantaged.

A second issue, on which we all agree, is that colleges are central to the skills agenda. In the past I have been the first and foremost among those criticising Ministers for their rather sniffy attitude to colleges' delivery. I do not think that Ministers always take into account the value added by colleges or the difficulties that they face.

3.32pm

Sitting suspended for a Division in the House.

3.46 pm

On resuming—

Mr. Boswell

I was saying that we all accept that colleges are central to the skills agenda, and that Ministers have not always been generous to them in the past. If we put that beside the spirit of the new skills proposals, to which we look forward, it seems that there is an anomaly in the present remuneration for colleges, and the way in which employer requirements are scored in respect of college participation. That is a central issue.

The point has already been made that the funding formulae sometimes reward only full glasses and give no acknowledgment to half-full glasses. That may well be a disincentive, either for completion—people may not be able to get through to the end—or because the course may not be what is actually required by the employer or by the individual.

However, another problem for employers is the proportion identified as employer-driven participation. I understand that the Secretary of State has said that it is as low as 7 per cent. On the occasions when I have examined the total revenue for colleges derived specifically from fees, it has always been quite low. I believe that it is below 10 per cent. The Minister is nodding. Of course, some of the students who are in colleges—we hope that they are there and that they have not been deterred, as some employees of small and medium-sized enterprises may have been, according to earlier exchanges—may not be counted as having been sent there by their employers even if the employer is actually picking up the tab, because they may not be directly funded on contract to the college.

I hope that Ministers will review that and refine the formulae, so that at least they do not jump to the conclusion that because colleges have a relatively low direct employer participation rate, that means that employers are not interested. I believe that the experience of most of us is that among good employers—to be fair, I must add that that usually means those that are well organised—there is a strong wish to make full use of college facilities.

It might also be worth considering whether students who are inspired by their employers to participate in basic skills training for which there is no fee nexus should not also be counted as participating with the encouragement of their employers. I believe that to be the case, and it is hugely important.

This year's funding settlement provides some relief. It is better than recent settlements; there is no point in arguing about that. However, we do not need a one-off—or even a three-year-off—change of gear without further progress. With all the difficulties and handicaps that further education has faced in the past, what is needed now, alongside a central role for FE, is a steady and sustained effort, without too many initiatives, but with a continuation of appropriate funding and a degree of continuity of policy and approach. That is the only way to deliver what we want collectively, which is a long-term improvement in the broad skills base of the entire labour force.

3.49 pm

The Minister for Lifelong Learning and Higher Education (Margaret Hodge)

It is refreshing to come to a debate in which all hon. Members from all political parties welcome the Government's investment in a particular sector. It is also refreshing to come to a debate in which all those who have spoken recognise the importance of the further education sector.

In response to the rather sour contribution from the hon. Member for Newbury (Mr. Rendel), I should point out that if FE had been a low priority in Government thinking, we would not be increasing investment by 19 per cent, in real terms over the coming three-year period. We would not be issuing a whole series of policy documents and initiatives that bring FE in from the cold and ensure that it can make its proper contribution. FE is central to what the Government are about. It is central to our desire to raise skill levels and qualifications, to improve our skills base and enable us to have a prosperous economy. It is central to our social inclusion agenda that we enable every individual to develop their potential and to contribute fully.

I do not recognise the interpretation that the hon. Member for Newbury put on our policies. Indeed, it is because FE covers everything from basic skills through to higher education, and because it deals with everyone from the age of 14 through to our oldest learner, who was 107, that it plays such an important role in what we do. If the hon. Gentleman were properly informed he would know that, as promised by the Learning and Skills Council, all colleges—except five, where there is still a dispute—received their budgets by the end of April. Again, I do not recognise his figure of 5 per cent. He should look at our departmental annual report, published today, in which we show that funding per student will rise by 7 per cent, in the next three years in real terms. By 2005–06, total funding for students will be 13 per cent, in real terms higher than it was in 1998–99.

The hon. Member for Twickenham (Dr. Cable), whom I congratulate on securing the debate, acknowledged that there is a 10 per cent, cash increase in the base funding rates for all colleges. He has two particularly good colleges in his constituency. I am in correspondence with the principal of Richmond adult community college about her funding. Funding for people in that area comes through the learning and skills councils. If the college gains funding elsewhere it is difficult for us to justify putting in additional funding to support activities that are funded elsewhere. I hope that he will recognise that.

A number of hon. Members mentioned that our funding over time will depend on performance. There will be a 2 per cent, real-terms increase this year. We recognise that there are additional pressures, but with that additional money all colleges are much better equipped to deal with them. Over the three-year funding period, which many hon. Members have welcomed, those that perform well next year will get a 2.5 per cent, premium. Excellent colleges that exceed their performance targets will get a 3.5 per cent, premium, which will go through into the following year. The outcome-focused funding mechanism is one of the most innovative structures that we have developed in government. Colleges will be rewarded for meeting and exceeding the outcomes that we want. The outcomes involve participation, success rate, employer engagement and raising the skills of the work force.

I will deal quickly with some of the issues that have been raised. The hon. Members for Twickenham and for Daventry (Mr. Boswell) expressed concern about how employer links are to be refined. We are aware of the importance of having sensitive mechanisms for measuring employer engagement; it would be different if someone were talking about a sixth-form college, and very different in many general FE colleges. We will be sensitive to that, but we want to encourage employer engagement. We are also sensitive to the importance of bringing small and medium-sized enterprises into the loop more firmly, and of ensuring that colleges can respond to training needs in SMEs. We will have something to say about that in the skills strategy that we shall publish in the summer.

I had the great pleasure of visiting City college in the constituency of my hon. Friend the Member for Brighton, Pavilion (Mr. Lepper), and seeing much of the excellent work that he has done there. I congratulate him on his active engagement with the FE sector, which is apparent in our correspondence on various issues. He talked about the foyer, as did the hon. Member for Twickenham, and he asked whether we could move towards some kind of support beyond the age of 19. All hon. Members recognise that that is important. We will introduce the education maintenance allowances nationally by 2004 and I hope that we will have something further to say about our proposals beyond that point in the skills strategy paper we will publish in June or July. We recognise, as other hon. Members do, that for many disadvantaged people in our community it is not beneficial for support for individuals to be cut off at age 19.

Linking with the Department for Work and Pension, which my hon. Friend the hon. Member for Plymouth, Sutton (Linda Gilroy) mentioned, is complicated and expensive. We are in constant discussion with our colleagues in the DWP, and my hon. Friend is correct to say that we should bang a little more consistently on the Treasury's door to try to get sensible working across Departments. There is, however, a real attempt to deal with that throughout the Government.

My hon. Friends the Members for Brighton, Pavilion and for Plymouth, Sutton spoke about our moves towards trying to get a level playing field between sixth-form colleges and schools with sixth forms. I acknowledge and welcome their recognition of the work we are doing on that. We hope to go further, and the financial settlement has taken us a long way down that road. However, no one can account for things that are outside their control. For example, because of pension contributions, we have probably been able to make less progress than we would have liked. Nevertheless, I think that we will make serious progress.

The hon. Member for Orpington (Mr. Horam), among others, spoke about qualifications being flexible. The importance of having bespoke qualifications to meet employer needs was also mentioned. We hope to deal with that matter in the skills strategy. Indeed, those who have read the document that we issued in consulting on the skills strategy will have seen various suggestions as to how we can move forward on modular and bespoke qualifications to meet the needs of individuals better.

I do not take kindly to hon. Members saying that we are not tackling bureaucracy. We have a long way to go, but the hon. Member for Newbury ought to ensure that he is better informed. I shall simply say that we have reduced some 75 or 76 different funding streams to five. We are implementing all the recommendations of the Sweeney task force on bureaucracy, and I hope to make announcements in the not-too-distant future about how we can take that good work further forward.

I know that hon. Members are anxious to move on elsewhere now. This has been a good debate; I welcome it, and the support that has been given to the generous funding settlement. I also welcome the partnership that we have established with colleges, in which we will put the learner at the centre, to increase participation and raise standards.