Skills and Post-16 Education Bill, Second Reading, House of Commons, 15 November 2021

• Good jobs and career opportunities where people live are central to the Government’s levelling up ambitions. Adults and young people deserve access to quality education and training opportunities provided by a joined up, place-based employment, skills and careers system.
• Local government – local authorities (LAs) and mayoral combined authorities (MCAs) – have a crucial role in making the skills and employment system work for their areas, and have wide-ranging functions and expertise in the skills system. During the pandemic, councils were trusted and relied upon by government to coordinate employment and skills provision locally.
• While we support the Bill’s aim to make the skills system more responsive to employers’ needs, the reforms need to be implemented as part of an integrated, place-based approach. Without a meaningful role for local authorities, the reforms risk creating an even more fragmented skills system, with different providers subject to different skills plans, a lack of progression pathways for learners and no local democratic accountability.
• It is essential that local authorities and MCAs vital role in the skills system is properly recognised in the Bill, and they are named as a core, strategic partner in the Local Skills Improvement Plan (LSIP) process. Effective local partnership working between Employer Representative Bodies (ERBs), local authorities and MCAs, their Further Education (FE) provider base and other local partners will be needed to shape a joined-up and coherent local skills offer. We are pleased that the Bill was amended in the Lords to embed greater partnership working between ERBs, FE providers, local authorities, MCAs and wider local stakeholders. We would want to see this maintained as the legislation is considered in the Commons and enacted.
• We would also like to see LSIPs strengthened through local approval and democratic oversight. Giving local and combined authorities an opportunity to sense check LSIPs before approval, would ensure they work for local areas, add value and join-up with other local provision.
• MCA’s already lead adult skills provision in devolved areas. Councils should also be empowered to coordinate an integrated skills and employment offer for their areas through a new ‘Community Skills Lead’ role, with strategic responsibility to plan adult education. This would enable them to work with the proposed ERBs and their provider base to better coordinate provision and align pathways of progression for learners.
• Provision for Level 3 (A-Level or equivalent) and above courses within the Bill are welcome, but too many adults do not have a Level 2 (GSCE or equivalent) and will be unable to access this offer. To truly level up, urgent investment in skills at Level 2 and below is needed. The complementary role of local authority adult education provision is integral to a joined up local provider base and should be properly resourced and recognised in FE reforms.
• Clause 25(A), which was introduced by the Lords, would ensure that two thirds of apprenticeship funding is spent on people who begin apprenticeships at Levels 2 and 3 before the age of 25. While we recognise the need to boost training opportunities for young people, this clause needs further consideration to prevent it from undermining the vital contribution of apprenticeships to lifelong learning.
• The Bill’s introduction of a National Provider Register should not impede councils and devolved authorities’ ability to take a place-based approach to provision and deliver on local needs. MCAs, which have devolved responsibilities for skills procurement, should be excluded from the register.
• Councils and MCAs are ambitious to design and join up local provision to create a local, integrated skills and employment offers tailored to the needs of local businesses and residents. We want to work with Government to ensure the Bill and wider reforms utilises councils and MCAs’ expertise in the skills system to deliver the best outcomes for every community. We continue to advocate for Work Local to be a blueprint for skills devolution

• The Bill legislates to place Local Skills Improvement Plans (LSIPs) on a statutory footing. These plans will be developed by employer representative bodies – for example, accredited Chambers of Commerce - in partnership with colleges and training providers and in consultation with key local stakeholders, to set out technical training provision for a local area and align it with employers’ skills needs.
• The Bill introduces a new power for the Secretary of State for Education to designate employer representative bodies to lead the development of LSIPs and to remove designation. It also places a statutory duty on all colleges and training providers to co-operate in the development of LSIPs, and act in regard to the plans.
• In Mayoral Combined Authority areas, final drafts of LSIPs will need to be approved in partnership by Mayoral Combined Authorities, while outside of devolution areas, LSIPs will be approved directly by the Secretary of State.

LGA view

LSIP development

The LGA supports the Bill’s ambition to give local employers a strong role in the skills system through LSIPs. However, the wide-ranging role of local authorities MCAs is missing from the Bill. It is vital that they have a core, strategic role in the development of LSIPs, working with ERBs, providers and other partners, to ensure they effectively consider local strategies, take a holistic view of the skills and employment system, and create an integrated offer that works for learners and employers.

We are pleased that the Bill was amended in the Lords to embed greater partnership working between ERBs, FE providers alongside local authorities and MCAs and other stakeholders. We want to work with Government to ensure this passes through the Commons and is carried into legislation.

MCAs have responsibilities for over half of England’s Adult Education Budget (AEB) and are responsible for the planning of adult education in their areas and a range of other related functions. Councils and devolved authorities also have wide-ranging functions that are vital to making the skills and employment system work for their local communities and economies and this should not be overlooked. These include:

• Working directly with existing and incoming businesses, representative bodies (Chambers of Commerce, the Federation of Small Businesses) and further education providers, to develop and connect growth, infrastructure spend, inward investment, SME, employment and skills strategies
• Lead labour market intelligence and scrutiny through Employment and Skills Boards (or similar)
• Performing granular analysis of national data and generate local data to target national and local provision to local labour market and learner needs
• Connecting, simplifying and promoting multiple national employment, training, skills and economic growth initiatives
• Commissioning and delivering adult and community education to level 2.
• Running their own devolved or discretionary employment and skills services, working with Jobcentre Plus and National Careers Service to provide a tailored local offer.
• Statutory duties to plan young people’s learning, including young people with special education needs and disabilities (SEND) and re-engaging people not in employment, education or training (NEETs)
• Supporting people with complex barriers to be training or work ready through wrap-around support services

On 4 November, the Department of Education issued LSIP trailblazer guidance for ERBs, which set out the stakeholders they must engage with when developing LSIPs. This included Mayoral Combined Authorities (MCAs), Local Economic Partnerships (LEPs) and their Skills Advisory Panels (SAPs) but did not include local authorities. We are concerned this could result in parts of England without devolution having unnecessary further fragmentation of the skills system, additional complexity for employers, individuals and providers, and disrupting pathways of progression from lower to higher levels of learning.  In practice, many local authorities are already working with their local Chambers of Commerce to support and help them prepare for the introduction LSIPs, so it is unhelpful for their key role not to be acknowledged.

If higher-level technical skills are the primary or sole focus of LSIPs, providers will have a new legal obligation to meet the delivery of this training in a way that they do not currently have for other skills and qualifications at a lower level. Without adequate local coordination, this could result in skewing the balance of provision within an area and disrupt the ‘skills escalator.’ For example, ERBs may identify the need for providers to introduce or expand provision of a higher-level technical qualification to address a local skills gap. Without an occupational pathway of progression from entry-level to higher qualifications, lower-level learners will be unable to access this training, limiting social mobility and potentially undermining employers’ access to a pipeline of talent.

Working with ERBs and other local partners, local authorities and MCAs can add significant value to LSIP process by ensuring they take a holistic view of the whole local skills and employment system, including tying in vital role of council-run Adult Community Learning (ACL), to create a joined-up offer with clear pathways of progression. This will be essential to provide opportunities for people with the least qualifications and to truly level up.

LSIP local oversight and accountability

We would also like to secure a role for local and combined authorities in the approval and oversight of LSIPs. This will enable local and combined authorities to understand how LSIPs will support learners and businesses, add value to other local jobs and skills provision, and raise any identified issues before LSIPs are rolled-out. There are various ways this can be done locally, for example, through scrutiny committees or employment and skills boards.

• The Bill will introduce a new loans system to allow adults to access funding for courses, with flexible access to learning across their lifetime. The “lifelong loan entitlement” will provide all adults with four years’ worth of loan funding for higher technical and degree level learning (levels 4 to 6), at university or college, and enable people to take-up individual modules to study flexibly alongside work. A consultation is expected this year. The Government will lay underpinning secondary legislation in Parliament in 2024, in order to introduce the “lifelong loan entitlement" in 2025. 
• Alongside this, the Government introduced the Lifetime Skills Guarantee in its Plan for Jobs. The Guarantee offers adults not yet qualified to Level 3 (equivalent of A-Level) the opportunity to gain a new qualification for free, from a specified list of over 400 qualifications.

LGA view 

The Government’s commitment to offer all adults a flexible, lifelong access to train for a Level 3 in-demand qualification through the Lifelong Skills Guarantee is welcome. We also welcome the ‘delegated’ role for MCAs to plan how the offer will work locally and are also pleased that these are being delivered in council-run adult learning centres.

Some MCAs found that sections of their foundation economy would not benefit from the national list of economically viable approved Level 3 qualifications, so they have used their devolved Adult Education Budget to widen access to supplementary qualifications, supporting more people to upskill. As local government seeks to support communities recover from the pandemic, this type of flexibility should be afforded to all local areas.

Level 3 provision alone will not deliver on the levelling up agenda, nor address longer-term productivity gaps in many areas of the country. Thirteen million adults in the UK do not have a Level 2 Qualification (equivalent to a GCSE) and nine million adults in England lack functional literacy and numeracy skills (OECD), meaning they are unable to take advantage of the Government’s expanded Level 3 offer. A mixed and balanced skills funding offer, which invests in community skills, basic and functional skills, technical skills, and higher-level skills, will be essential for addressing inequalities and supporting those with the fewest qualifications. The complementary role of local authority adult education is integral to a joined up local provider base, and it is important that it is recognised and properly resourced in proposals to reform the FE system.

There is an urgent need to prioritise training and support that helps adults progress from community-based, pre-entry level learning through to Level 2. Training at Level 2 is primarily provided by local authority adult and community learning (ACL) services who are experts in delivering community outreach and providing the intensive support these learners can need. Funding for adult skills mainly comes from the £1.5 billion annual Adult Education Budget (AEB), which has been reduced by 50 per cent over the last decade.

• To expand lower-level training opportunities, the Adult Education Budget funding should as minimum, be restored to its 2010 levels and fully devolved to local authorities and MCAs to target to local needs.
• The Government should focus efforts on supporting and funding the training network below Level 3, alongside the expansion of Level 3 provision. Both parts of the system need to work together and align provision to support learners to progress.

The Lords introduced a new clause (25(A) to the Bill which states:

Any employer receiving apprenticeship funding must spend at least two thirds of that funding on people who begin apprenticeships at Levels 2 and 3 before the age of 25.”

LGA view

Councils recognise the importance of expanding vital early career opportunities for young people. However, we are concerned that this clause challenges the policy direction of apprenticeships being an all-age, all-levels career development tool, that is open to everyone at any point in their career. While improving opportunities for young people is a welcome ambition, it is important that the Bill does not undermine the important role apprenticeships play in supporting people to retrain, change careers or return to work. Apprenticeships provide vital opportunities to train for people of all ages, including young adults who may not have been ready for an apprenticeship at an earlier age (such as care leavers) and the over 50s, who are widely acknowledged as a priority cohort for targeted skills and employment support. It is also not clear how this clause aligns with employment and equalities legislation.

• The Bill will enable the Secretary of State for Education to create a new list of post-16 education or training providers, to indicate which providers have met conditions that are designed to prevent or mitigate risks associated with the disorderly exit of a provider from the provision of education and training.
• Any provider not on the new National provider register will not be granted funding agreements and providers will not be able to subcontract with another provider that is not on the list.

LGA view

The proposal for a National Provider Register risks impeding local and devolved authorities’ ability to directly fund or sub-contract, any provider not on the new national provider register.

We are concerned that there may be unintended consequences to this policy. For instance, a national provider register could hinder local and devolved authorities’ ability to take a place-based approach to provision; restrict their ability to commission services from local Voluntary, Community and Social Enterprise (VCSE), specialist and niche providers, and prevent market-entry for small local providers. In rural and inner-city areas, local authorities and MCAs may not be able to fill gaps in provision at-pace, if larger providers on the register cannot deliver for financially viability reasons. Local flexibility is needed to ensure they can target and commission provision to deliver on local needs. One further concern is a risk that government could decide that all education and skills provision – national or local – had to be procured through this register.

As part of devolution agreements, it was agreed that MCAs would determine their own procurement requirements in compliance with appropriate legal regulations, which often go above national standards. Mayoral Combined Authorities should therefore be excluded from the National Provider Register.

In non-devolution areas, skills policy and provision is complex and lacks local accountability. This often results in a confusing picture for businesses and learners, with courses, advice and support being run by different providers, with lots of different rules on eligibility, access and entitlement. Without a formal devolution role, it is difficult for local authorities to untangle this web of national and local provision and create a coherent local offer.

To complement the Government’s FE reforms, we recommend that local authorities outside of devolution areas are given a defined ‘Community Skills Lead’ role in the Bill. This would empower local authorities with responsibility to strategically plan and coordinate adult education across their areas. It would cement the complementary role of Adult Community Learning (ACL) and other provision, and allow local authorities to work in partnership with ERBs and their FE provider base to align progression routes from community level training to higher-level skills and created joined-up skills offer. Local authorities are uniquely placed to fulfil this role, given they are democratic local leaders and local conveners, deliver ACL, lead economic spending, and work with existing and incoming local employers.

At the recent Budget, the Chancellor announced the Multiply programme which will help up to 500,000 adults improve their functional numeracy skills. It must add value to existing support, and where possible be delivered via adult and community learning (ACL) settings. This would allow them to provide learners with the wrap-around support they need to overcome any additional barriers to being work-ready and bring in literacy and digital support from the outset to provide a more rounded learning offer. If this is run nationally with a new set of providers, it will almost certainly duplicate existing numeracy activity funded through the AEB delivered locally. 

Local and combined authorities are ambitious to do more to join up local provision to create local, integrated skills and employment offers tailored to the needs of local economies and residents. The national skills and employment landscape is complex. Our previous analysis showed that funding was split across 20 employment and skills funding streams and managed by eight departments or agencies. New analysis will be out soon. At the local level, this results in a confusing picture with courses, advice and support being run by different providers, with different rules on eligibility, access, and entitlement. Councils play a key role in coordinating provision across their areas, to deliver a coherent offer that is accessible and simple for learners and businesses to navigate.

As we move forward, government should empower councils to work innovatively with their communities, government and its agencies to design a locally determined skills and employment system that can deliver sustained outcomes for their communities. The LGA’s  Work Local model provides a framework to make this happen, by giving combined authorities and groups of councils, working in partnership with local and national partners, the powers and funding to plan, commission and oversee a joined-up system by bringing together advice and guidance, employment, skills, apprenticeships and business support for individuals and employers, at the local level.

Based on analysis of an anonymised medium-sized combined authority, a Work Local model could lead to additional fiscal benefits for a local area of £280 million per year, with a benefit to the economy of £420 million. This would be associated with an additional 8,500 people leaving benefits, an additional 3,600 people achieving Level 2 skills, and an additional 2,100 people achieving Level 3 skills. We are calling on the Government to trial the Work Local model. This would include funding pathfinders across rural, coastal and metropolitan areas and deepening existing devolution deals.

Megan Edwards, Public Affairs and Campaigns Adviser

[email protected]