What do the interim Augar response and Skills for Jobs white paper mean for HE?

Debbie McVitty digests the Westminster government's post-compulsory skills agenda as set out in the Skills for Jobs white paper and the interim conclusion of the review of post-18 education and funding.

Today further education takes centre stage in the Westminster government’s Skills for Jobs white paper and interim response to the Augar review.

And rightly so – the sector that has faithfully delivered the less glamorous elements of the post-16 education system despite decades of funding cuts, complex accountabilities, and forced reorganisation is having a well-deserved policy moment.

But we know our readers are mostly interested in the implications for higher education so that’s where we’ll start.

Interim conclusion to Augar

The government’s interim conclusion of the review of post-18 education and funding picks up several measures elaborated further inthe Skills for Jobs white paper, including the lifelong loan entitlement, local skills improvement plans and the rollout of approvals for higher technical qualifications. It’s indicated that the government’s plans for incentivising more modular and flexible delivery apply across higher education.

As predicted, home undergraduate fee levels and any other serious funding reforms are deferred until the government can muster a comprehensive spending review – with the current freeze on the maximum fee level extended until then. But there are some additional nuggets in there.

In addition to consultation on the lifelong loan entitlement we’re promised a consultation on “further reforms” to the higher education system in spring 2021” – which could include thorny issues like minimum entry requirements for higher education, the treatment of foundation years, and reforms to student finance, “and other matters” (quality? freedom of speech? grade inflation?) ahead of a final decision as part of the CSR.

There’s a plan to realign teaching grant funding towards national priorities, including STEM, healthcare and “specific labour market needs” as well as a shift in the current teaching capital funding, currently allocated on a formula basis, to a system based on providers’ bids against criteria relating to economic needs and the levelling up agenda – a move that, given we’re only talking about £150m annually in funding could end up costing rather more in burden for providers and the regulator than is worth it in outcomes.

Higher technical provision

Turning to the FE white paper Skills for Jobs, and plans for boosting higher technical provision, there’s a clear framing argument that expansion of higher education has not led to improved outcomes across the piece for students and employers.

Three claims are made to support this argument:

  • There is growth in employer demand for higher level technical skills – the source is Working Futures 2017-27, labour market analysis compiled for DfE by the University of Warwick’s Institute for Employment research and Cambridge Econometrics and published in February 2020. This report does indeed predict that employment growth will be most rapid in the associate professional and technical occupations (but also predicts growth in managerial and professional occupations).
  • Only 66 per cent of graduates are employed in highly-skilled occupations. The source is DfE’s graduate labour market statistics which are based on Labour Force Survey data of 16-64 year olds.
  • Higher technical courses can lead to better employment/salary outcomes. The source is a briefing note from the Centre for Vocational Education Research, which explores the earning outcomes of different post-18 routes. The report does find that estimated short-term salary returns to males with level four qualifications and females with level five qualifications are better than graduate salary returns. However, the authors suggest that these difference may narrow or disappear over time as people hit their thirties. They also warn against assuming that massive expansion of sub-degree qualifications would result in similar differences in returns.

Building on this case, the white paper sets out a plan to boost higher technical routes at level four and five, with the same quality and prestige that academic routes enjoy currently. Approval for higher technical qualifications will sit with the Institute for Apprenticeships and Technical Education and be based on the institute’s employer-led standards for higher apprenticeships. Approved higher technical qualifications get a kitemark and from 2023 funding will be reduced for those non-approved.

Initially OfS registration will be the system for quality assuring providers of higher technical qualifications; from 2023 a new system for assessing quality, designed with Ofs and Ofsted (but not QAA apparently) will quality assure all technical education providers, including apprenticeships.

Rollout of higher technical qualifications will be aligned to T levels, enabling progression from T levels to HTQs. And in summer 2021 there will be funding for a further eight Institutes of Technology (there are 12 currently), with the aim of offering high quality higher technical STEM provision in all areas of England. There’s a (limited) plan to improve careers advice, with improvements to the national careers service website and further rollout of local careers hubs – all with an emphasis on showcasing the range of options at post-16 and post-compulsory.

Apprenticeships will also see further efforts at expansion, with funding for smaller employers to offer apprenticeships, greater ease for larger employers to transfer their apprenticeship levy funds, and the publication of salary returns data for apprenticeships.

Lifelong loan entitlement

Where things get interesting is in plans for the new lifelong loan entitlement (not to be confused with the lifetime skills guarantee). The new entitlement aims to underpin parity between academic and technical routes, giving equal access to loan funding and maintenance whatever path is chosen for up to four years of study throughout life – though clarity about the actual shape of the finance system will have to wait until the CSR like everything else. Almost in passing the white paper notes “We will examine the fee limits that apply to different qualifications at higher levels to ensure value for money for the learner and the taxpayer.”

Clearly for this to make any difference, you need to tinker with the shape of provision. The white paper sets out plans to incentivise more modular and flexible higher education provision and, importantly, credit transfer, in the hopes that it becomes possible to move between courses and institutions at different life and career stages without incentivising the production of hundreds of low-quality modules that don’t lead anywhere in particular. OfS will roll questions of standalone modular provision into its thinking on the development of the quality regime.

If the government can crack this policy Holy Grail, it will have a genuine claim to having radically transformed post-compulsory education. But this white paper marks an intention to start developing the answers rather than concrete proposals. There will be a consultation on the objectives and implementation of the lifelong loan entitlement, including questions like the minimum credit level for a single module, rules on accessing funding for equivalent and lower qualifications and the dreaded credit transfer (again) – and in 2021-22 there will be funding for trials of modular provision.

Boosting colleges

The parts of the white paper that have less immediate relevance to higher education are still worth engaging with, especially for those institutions who have close relationships with colleges, are involved in Institutes of Technology or have a local college that has ambitions in the higher technical space.

There will be new employer-led local skills improvement plans, with employers working with colleges on identifying skills gaps and a strategic development fund to help colleges pivot provision. If you were wondering how this integrates with local enterprise partnership activity and mayoral combined authority remits, there is still some ironing out to do – but there’s an ambition to write employer leadership of local skills agendas into law.

Chapters four and five are all about strengthening colleges, with carrots and sticks in evidence. There’s formal clarification of the purpose and role of colleges, with a focus on provision of job-focused technical and higher technical education. There’s a promise to streamline funding and give colleges more autonomy in how it’s used, with a greater focus on outcomes. College governance is to be strengthened, and colleges are to be supported to engage more closely with business. And there’s a plan to improve teaching quality in colleges, with alignment of ITE with employer-led standards, enhanced professional development and a national recruitment campaign.

But there’s also the promise of a clearer and more direct line of sight between DfE and individual colleges, with annual reviews and new “last resort” powers for the Secretary of State to intervene, including in college leadership and governance, where colleges are failing.

Summing up

Overall, though each individual policy is potentially rather thin, the package as a whole – with sustained focus and funding – could begin to move the dial on diversifying post-compulsory options and boosting lifelong learning. Higher education can be cheered by the implied agnosticism in which organisations should deliver higher technical. There is a clear role for universities in developing progression routes and a lifelong learning offer – which would mean biting the bullet on facilitating credit transfer.

Effective local coordination is notoriously tricky to deliver, with some localities simply culturally and historically better at working together with others – with geography as much of an issue as local personalities. DfE will need to invest in understanding some of these local variations and being flexible to get the best out of local skills improvement plans.

Greater power and profile for colleges could provide a useful corrective to the tendency of some universities to take a rather dismissive view of what colleges have to offer – and we’re sure the reverse is sometimes the case as well. Universities may need to double down on the work that has taken place over the last few years to improve partnerships and collaborations with FE, or risk being sidelined.

And no aspect of this policy agenda is made easier to give the necessary consideration and strategic thinking by the Covid-19 pandemic. The detailed work of developing and consulting on effective policy that has a lasting impact is even less likely than usual to happen in the way the government hopes.

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