Linking London. Xmas Debate. Policy Picture Dec 2012

The 12 Days of Christmas 12. Growth Plan 11. Quangos 10. Richard recommendations 9. New Challenges/New Chances 8. Core Cities 7. Baccs 6. Key chapter in Heseltine 5. Apprenticeship Reports 4. Skills priorities 3. m learners 2. Fiscal targets 1. Single pot

How’s it looking out there? Coalition moving into second half, new tone set in Autumn Conference speeches, aspiration nation v one nation Reshuffle over, main players in place for build up to election, narrative emerging, renewal of marriage vows coming Economy still key factor, Coalition sticking with Plan A, Opposition with 5- point alternative Economic forecasts remaining cautious, UK ‘consolidation’ rolling on to 2017/18 Growth flat, inflation up and down, unemployment down, underemployment up Rolling growth plan in place, subject to various outriders: industry plan (Sept,) economic plan (Oct,) apprenticeship plan (Nov,) budget plan (Dec) Education and skills agenda built around the 12 elements in the Growth Plan: apprenticeship developments; Eng/maths; STEM; youth employment; qualification reform; destination data; employer ownership But, 4 key issues: funding; quality; qualification reform; system reform

1. Funding Four areas Messages from the Autumn Statement Skills investment 2013/14 Loans 16-19

Messages from the Autumn Statement (1) General Key word: ’healing’ Most used word: ‘fair’ Main message: ‘it’s a hard road but we’re getting there’ Meaning of main message: stick with a) us and b) Plan A Sub text: strivers v skivers Rewarded: Michael Gove Recognised: Michael Heseltine Surprised: FE sector (pleasantly) Some important numbers Growth, slower than forecast: -0.1% (2012,) 1.2% (2013,) 2% (2014,) 2.3% (2015) Jobs: better than forecast: unemployment to peak at 8.3% in late 2013 Total budget: £745bn Dept spending: cut by 1% (2013,) 2% (2014) but met through efficiencies Pay: 1% rise, though performance linked for school teachers Welfare: 1% pa rise for next three years 80:20: balance maintained

Messages from the Autumn Statement (2) Specific Schools –£980m up to 2015 for new free schools and academies –New pay/performance structure possibly from 2013 –School budgets remain protected FE/Skills –£270m for capital investment –Extra £90m for EOPs –£350m for RGF –£6m match funding for development of digital content skills –Movement towards a single pot by April 2015 –£250,000 +£10m for individual LEPs to enable creation of local skill priority plans –LEP local skill plans by July 2013, employment measure data/KIS by end of 2013 –Endorsement of Heseltine model HE/science –£600m for RCs and R and D –Updated Life Science Strategy –£120m for Adv Manufacturing

The Heseltine effect (1) Landmark Report. Commissioned March 2012, published Oct 2012, incorporated into Autumn Statement Dec 2012, formal response spring 2013 Remit: what do we need to do to invigorate growth? 89 recommendations, 14 for education and skills Key messages: need for a clearer national focus, simpler funding channels, demand through local drivers, more responsive education and skills system Key players: –A new National Growth Council (chaired by PM, set overall strategy) –Gov Depts (shared responsibility for aspects of growth strategy) –LEPs (take a lead at a local level for setting local priorities) –Chambers of Commerce (work with LEPs building local support) –Economic sectors (work with Depts on delivery) –Regulators (ensure measurement and recognition of economic impact) –Schools, FE, HE (provide skills pipeline) Key mechanism: single funding pot

The Heseltine effect (2) Schools: –Raise standards through improvement strategy, LA leadership, Ofsted RDs –Improve employability of school leavers through focus on Eng/maths, access to work exp, greater business engagement, stronger destination data FE –Make skill system more responsive to local needs using EOPs, ESBs, City Deals –Devolve 19+ skills budget and 16+ apprenticeship budget through to single pot –Ensure vocational and training provision agreed with LEPs –Use single pot to support local NEET and careers activity HE –Support for KIS and industry kite marking –Use Industry Councils to ensure courses match employer needs –Make greater use of employer student sponsorship –Review approach to visa arrangements

Skills Funding Settlement 2013/14 Dept resource reductions to be managed through efficiencies Total T/L budget of £3.2bn for 2012/13, £3.1bn for 2013/14, £3.2bn for 2014/5 Providers can bid into EOP funding which rises to £340m for 2015/16 Increase in rate for Functional English and maths endorsed, details Jan 2013, distance-travelled funding potentially from 2014/15 £129m set aside for loans in 2013/14 rising to £398m in 2014/15 £764m for adult apprenticeships in 2013/14 rising to £770m in 2014/15 Review of QCF including review of NOS £550m over 2 yrs for capital investment Detailed 2015/16 spending plans to follow a review in the first half of 2013

2. Quality Some concerns evident in latest Ofsted report Some figures: –81% success 78% for apprenticeships –1.5m learners with ‘not yet good’ providers –56% of overall good or outstanding –33% of providers satisfactory (35% last year,) 51% good (same as last year,) 13% outstanding (12% last year,) 3% inadequate (2% last year) 5 areas of concern: –Overall quality of provision –Poor T/L –Lack of effective leadership, governance and challenge –Some apprenticeship provision –English and maths success rates

3. Qualification reform March of the Baccs Changes at English and maths Apprenticeships

3. March of the Baccs EBCs –Primarily aimed at 16 yr olds, long-term GCSE replacement –Largely knowledge based, core academic subjects –Offered through tendered exam process ABacc –Possible IB variant to complement A level reforms –Incorporating ‘contrasting’ subject, dissertation, community activity Tech Bacc (1) –Labour alternative for –Conditional on L2 Eng/maths, an accredited L3 qual, ‘quality’ work experience –Builds on Adonis thinking, informed through Husbands’ Review Tech Bacc (2) –Government adoption at –To include quals from new approved KS5 list, maths, extended project Baker Bacc –Ken Baker model to support UTCs, available at 16 and 18 –At 16, Eng, maths, science + a tech qual, work exp, IT and employability skills –At 18, 2 A levels in sciences and technical subjects, 2 approved tech quals Not forgetting –International Bacc, Welsh Bacc, Birmingham Bacc, Mod Bacc and other variants

3. English and maths Current position Adoption of L2 benchmark for all programmes (2012) Poor success rates highlighted in Ofsted report (2012) Additional funding announced (2012) Richard Review propose L2 as a condition of apprenticeship success (2012) Launch of National Numeracy Challenge (spring 2013) Report on distance travelled funding pilot (June 2013) Funding conditionality introduced at (Sept 2013)

3. System change. FE Current position –Launch of initial Skills and Investment Strategy (Dec 2010) –New Challenges/New Chances reform programme ( –Introduction of Innovation Code (autumn 2011) –Emergence of Gazelle Group (spring 2012) –Final Lingfield Report (Oct 2012) –Funding settlement for 2013/14 (Dec 2012) –Recruitment of yr olds announced (Dec 2012) Key issues –4 yr budget reduction; sweeping changes to 16-19, adult skills, ESOL and community provision; changes to and HE alignments; emphasis on quality provision; employer ownership; new forms of governance What to look out for –Reports from the CAVTL (Dec 2012, March 2013) –Consultation on Guild and chartered status (Jan 2013) –Consultation on perf table criteria for VQs (2012/13) –Application of common performance measures (2013) –Implementation of new PoS and funding system (Sept 2013) –Recruitment of 14+ learners (Sept 2013) –Implementation of new streamlined funding system and 24+ loans (Sept 2013) –Alignment with LEP skills priorities (2013)

3. System change. HE Current position –Government Response to White Paper outlines future direction (June 2012) –First intake under new fee system (Sept 2012) –Maximum fee level remaining for 2013/14, maintenance grants uprated in line with inflation (April 2012) –New institutional fee levels for 2013/14 signed off by OFFA (July 2012) –Tariff policy liberalised to ABB and 5,000 added to margin places for 2013 entry – Introduction of KIS, NSP, Unistats (Sept 2012) –Approval of university title for 10 new colleges (Nov 2012) Key issues –So-called ‘squeezed middle;’ growing debt burden; potential lifting of the cap; impact on recruitment; emergence of high – table; nature of regulation; global market; widening participation; HEPI analysis of fee regime What to look out for –UCAS milestone data (Jan 2013) –Interim WP Report (Jan 2013) –Confirmation of 2013/14 funding settlement (Jan 2013) –Adoption of HEAR (2012/13) –Development of new QA system (2013) –Impact Reports from HEFCE and Independent Commission (2013)