Debate on the Address

My Lords, I shall talk briefly about several key parts of the Government’s legislative programme, which was announced in the gracious Speech. It is clear from that programme that education remains a priority for the Government, who have backed it up with a strong record of investment. This is particularly true of science and technology, and I hope that the House will permit me to pay tribute to the noble Lord, Lord Sainsbury, who was Ministerfor Science and Innovation until recently. He has made an outstanding contribution to science and innovation in this country, and I know it is in a better shape for his hands-on approach. Indeed, it is pleasing to see a cross-party consensus emerging on taking forward a set of very complex issues, and I hope that the noble Lord’s successor, the noble Lord, Lord Truscott, and Malcolm Wicks in the other place will continue to keep science high up the political agenda. The skills agenda, which figured so large in the gracious Speech, has assumed an increasingly prominent position in government thinking in the past three years. It has been driven by a number of broad social and economic factors, which were neatly summarised by the Chief Secretary to the Treasury in his Written Statement announcing the Comprehensive Spending Review, to which several noble Lords have referred. In it, he set out five strategic challenges facing the United Kingdom, which the review would have to address. The first three are directly relevant to the Government’s skills agenda. The first is a rapid increase in the old-age dependency ratio as the baby-boom generation reaches retirement age. I feel particularly strongly about that. The second is the intensification of cross-border economic competition as the balance of international economic activity shifts toward rapidly growing emerging markets such as China and India. The third is an acceleration in the pace of innovation and technological diffusion and a continued increase in the knowledge-intensity of goods and services. Employers have not been slow to react. They have said emphatically that they need higher skills to compete in a global economy driven by technological change and the need for ever more effective management. According to the CBI, almost three-quarters of employers say that their employees need increasing skills. They also say that world-class education is fundamental to ensuring that young people are equipped to succeed in the world of work. There is a real appetite for responding to this challenge right across education. I can speak with personal experience from the higher education sector, and I declare an interest as chief executive of Universities UK. There are a huge number of opportunities in higher education—from contributing to the efforts to widen participation, to increased continuing professional development, to new relationships with business and, particularly, to close partnerships with further education. However, there are risks in this for both further and higher education. In particular, the financial risks associated with developing new provision in collaboration with employers where it is not certain whether there is either student demand or long-term demand from the employer’s side is currently a barrier to development. I feel that the Government could consider providing—the Minister might comment on this—additional financial support to institutions to cushion that risk as they develop new employer-led provision, which clearly they are keen to do and, patently, need to do. Further education will figure in legislation during this Session. Today, in an article in the Guardian, my right honourable friend the Secretary of State set out what the Government have done and intend to do on reorganisation and investment in the further education sector, including the work of the skills academies. The Government rightly wish to emphasise this work further, first, through the work being done by my noble friend Lord Leitch—we eagerly await his report, which, I believe, is due very shortly; and, secondly, with the publication of the Further Education and Training Bill, designed to develop the management of further education colleges and streamline the learning and skills councils. I would now like to address a similar concern to that expressed by the noble Baroness, Lady Sharp. The Bill also contains measures allowing for further education colleges to be given the power to award foundation degrees. As many noble Lords will be aware, a small but significant proportion of higher education courses are run through local further education colleges, often very successfully. I know that the Government intend to consult on this proposal and I look forward to taking part in those discussions because there are some key areas where I would like to understand better their thinking. For example, will further education colleges be subject to accreditation by the Quality Assurance Agency, as are higher education institutions? I hope that the Minister will be able to provide further detail on that point later. I look forward to seeing details of the proposed Immigration Bill, also raised in the loyal Address. I understand that that will be primarily a tidying-up measure, rather than creating any new law. Although I appreciate that this is a Home Office matter, I hope that noble Lords will not object if I remind the House of the impact that our immigration system can have on higher education. While I, and all members of this House, clearly support the maintenance of safe and secure borders, I must emphasise the importance of ensuring that our immigration system does not act as a barrier to attracting bright, well qualified, bona fide international students to study in the UK. As we are debating health today, I would like to ask the Minister in the Department of Health what he proposes to do to solve the current crisis in National Health Service workforce planning. A number of higher education institutions are currently grappling with the problem of strategic health authorities cutting training budgets. The consequent financial uncertainty means that, for a number of higher education institutions, education for nursing and allied health professions may no longer be either viable or sustainable. I refer to the point that I made on the skills agenda: institutions are willing to work with one employer—this happens to be the health service—but on this occasion the financial rug has been pulled out, which underlines the risk associated with the development of those courses. The situation regarding NHS workforce planning could have dire consequences for future patient care and health services overall. Putting higher education institutions through a boom-bust cycle of funding is no way to ensure stability in the National Health Service or our higher education sector. If it means, as the noble Baroness, Lady Finlay, emphasised, a lack of opportunities for nurses and allied health professionals that is a very sorry outcome. I hope that the Minister will be able to enlighten me on his discussions with his colleagues in the DfES on this matter. All the issues that I have covered are indicative of the range and importance of the higher education sector to the UK. Higher education institutions are worth £45 billion to the UK economy and, for every 100 jobs in a university, a further 99 are created entirely as knock-on effects. Just in terms of export earnings, it is worth reminding the House that education is already worth more than £10 billion—bigger than exports in food, tobacco, drink, insurance, ships and aircraft put together. Finally, with the coming spending review in mind, which several noble Lords have mentioned, I should like to urge the Government to continue to ensure stability in the public funding of higher and further education by maintaining their unit of resource for teaching, and enabling them to continue to deliver the high quality teaching and learning for which they are world renowned. They are crucial to developing the skills base and innovation culture in our country. I know that the Government recognise the contribution that higher education makes to the economic, social and cultural well-being of this country, as do many Members of this House. I look forward to debating these very important issues over the next parliamentary Session.