Time for us to show our skills

19th March 2014

Column originally published in The Municipal Journal on 5 March 2014.

I recently argued in these pages ‘what matters is what works’ in reforming the national learning and skills system.

To address this challenge, rebalancing skills alongside infrastructure, housing and transport looks set to become the most significant strategic issue facing local enterprise partnerships (LEPs) this year.

We have now had the 2013-16 Skills Funding Statement. This is the equivalent of the local government Revenue Support Grant (RSG) settlement, this year not received until February.

Like the RSG, it is usually pre-Christmas. Like local government, the annual muted outrage at late settlements fell largely on deaf ears in Whitehall.

Further education colleges, private and independent training providers, local authorities and the Offender Learning and Skills Service will have been keenly anticipating this statement. LEPs, where they are aware of the opportunities it could provide, should have been doing the same.

So how does the Skills Funding Statement meet the challenge? And is local government aware of what this statement presents to their economic renewal plans?

We are not strangers to bad news about public funding. Almost 20% of the already depleted £2.46bn adult skills budget will be lost by 2015/16. This budget provides much of the core funding to local further education colleges, and the bulk of apprenticeships delivered via colleges and independent providers.

Further strain comes from it also having to pick up the costs of higher level apprenticeships as a result of the failed loans policy. Other resources for ‘employer ownership’ – putting a small amount of skills funding in the hands of employers (and for offender training, community learning in local areas, and the National Careers Service) – stay largely unchanged, albeit not in real terms.

The Government’s priority remains ‘skills provision focused towards young adults and the unemployed’. This is demonstrated starkly in the virtual absence of publicly funded provision for people over the age of 24 that will now characterise the period beyond the 2015 election.

We argued that retaining a ‘ladder of progression’ was essential – from adult basic literacy and numeracy, through foundation learning, Level 2 and 3 skills (including apprenticeships) to level 4 and higher education.

The Government’s rhetorical intent to protect opportunities for those who benefitted least from their initial education is welcome. But funding pressures remain stark, alongside the depleted opportunities for the whole of the local labour market – especially those over age 24.

So where is the opportunity for councils and LEPs? Local priorities for skills are central to Growth Deals. LEPs have submitted their final strategies for 2014- 20 European Structural and Investment Funds, including £170m in the Skills Funding Statement as matched funding.

Three new Skills Funding Incentive Pilots (North East, Stoke and Staffordshire and West of England) await evaluation. For two years from 2015, £330m of skills capital funding will be available via competition for LEPs, open to providers offering vocational education provision.

The golden opportunity is for LEPs, with councils, colleges and employers round the same table, to do what they are best at – strong local partnership working on skills and economic regeneration.

LEPs must become central to influencing learner and employer demand and motivation against this challenging financial backdrop.
The simplistic critique of the further education supply side can become a more strategic debate on matching supply and demand across the whole local labour market in this.

Like the best in local government that has risen to the challenge of austerity rather than giving up on local communities who need them most, the challenge is now for the learning and skills sector, working hand in glove with LEPs, to do the same.