Article first published by FENews 24 July 2024

Written by Dr Mandy Crawford-Lee, Chief Executive, UVAC

Recent Political Developments

In the past two months and more, the higher and further education system has seen electioneering campaigns unfold, the publication of party manifestos, the first Labour King’s Speech in 14 years, a new line up of secretary of state, ministers of state and parliamentary under-secretaries of state at the Department for Education (DfE) and, just this week, the promise of a new Skills England bill to create the next non-departmental public body to repair what is “fragmented and broken” in apprenticeships and skills. Finally, we are getting to see the implementation of new policies and new priorities.

The Emergence of Skills England

The ‘time for a change’ mood pre-election continues as expected post-election. The appointment of Richard Pennycook (the former boss of the Co-operative Group, an organisation that waded in to capture headlines in 2023 by claiming that £600M of ‘wasted’ apprenticeship levy was returned to the Treasury) as interim chair seems a safe choice given his current role as lead NED at the DfE. A role, albeit temporary, that will require good listening skills if Skills England is to emerge, as some have described, as ‘a Swiss army knife of an agency’ responsible for meeting the needs of the industrial strategy and Green Prosperity Plan, the occupation shortage elements of the Home Office’s migration work, support regional and local growth initiatives, connect to local commissioning bodies, provide accurate labour market data, reconfigure local skills improvement plans and decide on which skills provision and what funding … all at the same time.

The Potential Impact of Skills England

Will Skills England be a big deal? Undoubtedly, because it will be the new post-16, post compulsory, arm’s length body, framed as complementary to and necessary for greater devolution of skills planning and spending powers. It is also to be the ostiary to the new Growth and Skills Levy, deciding on and maintaining the list of those courses outside of apprenticeships that should be funded. Perhaps Skills England will achieve a consensus on the aim and objectives of the ‘skills system’ or its coverage, and what the respective roles of government, employers, individuals, and institutions are within that system. What has been missing is a national vision of the skills challenges and opportunities facing England and an annual report on the impact of apprenticeships and skills provision. I hope that Skills England gets to perform such a role.

Key Considerations for Skills England’s Success

If Skills England’s role is to have the optimum impact on productivity, social mobility, transition to the net zero economy and the delivery of public sector services my hope is that first and foremost, Skills England will encompass individuals of ALL AGES and include ALL LEVELS of programme, and ALL TYPES of providers, when considering policy. Secondly, that government ensures that the country, in the form of government, employers and individuals invest more in training and development.

Investment must, however, have a focus. The country needs to invest in the skills and occupations needed to raise productivity, deliver key public sector services and the net zero economy. This does not mean a rigid national plan. After all, employers generally know which skills their organisations need. Labour markets are also frequently regional or indeed local.  Government does, nevertheless, have a role in ensuring colleges, independent training providers and universities deliver the programmes employers and individuals need and that employers invest in training. This is why Labour’s decision to establish Skills England is an interesting one.

The Economic Context and Skills Policy

One of the core priorities for the new government is the economy and the context in which Skills England will function. To deliver significant growth in this area it will need to focus skills policy on lifelong learning, to raise skill levels and productivity amongst those already in work. The development of a high skill, high productivity and high-income economy calls for an emphasis on higher level skills rather than just those at lower level, which pre-election Labour were primarily concentrated on. Research UVAC conducted amongst its university members revealed that 88% feel that Labour now needs to recognise higher and degree apprenticeships as vital to addressing the UK skills gap. Given the challenges Labour has inherited within the NHS and across all public services, raising skill levels in the public sector will be pivotal to improving the delivery of those key services. Four of the seven most popular degree apprenticeships are for public sector occupations – police constable, registered nurse, advanced clinical practitioner and social worker. It would be a little odd for Labour, which sees itself as the party of public sector services, not to champion the use of degree apprenticeships and levy funds to train registered nurses, police constables and social workers.

Funding Challenges and Priorities

In my view, Skills England will find it hard to determine what training programmes/courses it approves, in addition to apprenticeships, for levy funding. Good arguments will be advanced by employers, training providers and stakeholders for levy funding for a range of different programmes. What is certain is that the costs of funding the range of programmes proposed will be far greater than the funds raised from any growth and skills levy. Skills England must ensure that any training the Growth and Skills Levy financially supports focuses on tackling the skills needs of the economy and those other key government policies.

For the near future, I hope that in its shadow form Skills England is not persuaded to make any recommendation involving “ring-fencing more levy funding for training of younger apprentices and learners”. This would be flawed and very damaging to the role of apprenticeships and skills in raising productivity, recruiting, and training individuals for key public sector roles and supporting social mobility. We know skills policy has a key role in raising productivity, arguably the UK’s number one economic challenge.

Recommendations for Skills England

Crucially, Westminster Government will need to ensure that Skills England is independent, blind to provider type and focuses on the skills the economy needs, regardless of level of skill and age of employee. Without a doubt, England has the right range of institutions – universities, further education colleges, independent training providers, and employers – to deliver the skills provision the economy needs.

Finally, and rather radically, if the Prime Minister and Chancellor of the Exchequer want to demonstrate Labour’s commitment to growth, productivity and increasing the labour supply, they could also require Skills England to report to His Majesty’s Treasury (HMT). This would reflect the need to support and require employers to invest more in the training and development of their workforce, to change this low train culture to a culture where employers invest and celebrate their investment in training and to determine the respective roles of the state, employers and individuals in funding training and professional development. Skills England would do well to remember that skills policy involves fiscal matters, the levy and financial incentives and measures to increase employer and individual investment in skills, as well as productivity, means HMT really matters.

Now that would be real change in the making.