The EU referendum result was a vote for change, and it is for politicians to listen and act accordingly. Some of the research has shown that many Leave voters felt that globalisation had not delivered good outcomes and opportunities for them and they wanted to see change.
One policy area we should look at is how to equip young people and adults, in every part of our country, to respond to the modern world of work and keep their skills up to date. This will enable them to get and retain good, well-paying jobs and ensure they reach their full potential.
The introduction of T-Levels (a technical alternative to A-Levels) is an important step in providing young people with high quality routes beyond university. I am pleased that the Government is sticking to 2020 as the start date for delivering T-Levels. The success of these qualifications will depend on whether employers value them.
I hope that the Government will work with employer organisations, such as the Confederation of British Industry (CBI), British Chambers of Commerce (BCC) and Federation of Small Businesses (FSB), to advise the business community about the value of T-Levels. Small and Medium Enterprises should be properly engaged through their trusted advisors such as accountants, solicitors and business bank managers to ensure the message reaches everyone.
Apprenticeships are the gold standard in technical education. The Government has rightly reformed apprenticeships in order to both increase the quality and quantity available. Recent data showed that almost half of apprenticeships were of the ‘standards’ type, compared to just 5% the year before. Apprenticeship standards are seen to be better than frameworks because they are employer designed.
However, since the apprenticeship levy was introduced, the number of apprenticeship starts has fallen. Therefore, we need to change how the levy operates. Many businesses have said they plan to treat the levy as a ‘tax’ which defeats the purpose of the policy. There should be greater flexibility for levy account holders in how they use their funds, including the ability to pass on levy funds down a supply chain and also for companies to collaborate with other levy payers to plug local skills gaps. There would also be merit in using dormant levy account funds to support the roll-out in T-Levels.
According to the House of Commons Library, the new national funding formula for schools includes a minimum funding level per secondary school student of £4,600 in 2018-19 and £4,800 in 2019-20.4 The maximum university tuition fee for 2018-19 is £9,250. In comparison, the national per student funding rate in the 16-19 funding formula is set to remain at £4,000 until at least 2019-20.
The Institute for Fiscal Studies (IFS) has concluded that “16-18 education in England has been the big loser from education spending changes over the last 25 years”. The introduction of T-Levels and the reform of apprenticeships will ensure that technical education is held in the same esteem as more academic courses of study. Increasing Further Education (FE) funding would tell employers and students that the FE route is neither second class nor just a ‘second chance’ but a viable and valuable route in itself.
English universities are being sufficiently funded, participation rates keep increasing and more disadvantaged students are going to university in England than ever before. However, there are further reforms which should be made.
First, we should use the CPI measure of inflation, not RPI, to calculate student loan interest rates. The Office for National Statistics says of RPI that ‘we do not think it is a good measure of inflation and discourage its use’. This change would have the benefit of reducing the headline interest rate.
Second, the Government should support students who are not supported by their parents to go to university, but are not eligible for the maximum maintenance loan of £8,200. I believe that maintenance loans are designed to contribute to a student’s living costs, and students are expected to supplement them through either employment or parental support. Allowing students to apply for an increased loan if their parents are unwilling to make any financial contribution would empower them to make their own decisions about their education.
Third, the Government should improve the way in which it communicates about student loans. The student loan system is more akin to a graduate tax, and this should be made clear. The IFS estimated that the average loan subsidy per student amounts to just over £17,000, and the lowest-earning 10% of graduates receive a subsidy of 93% (£36,481 on average). A degree is of benefit to the holder and society, which is why the responsibility is currently shared between the individual and the taxpayer.
Shifting the focus to FE is not only the right thing to do, but it sends a powerful message. Whilst Labour is pushing for the abolition of tuition fees, which ultimately benefits the most privileged parts of society-graduates, the Conservatives would be ensuring that the most disadvantaged have the skills to enter the workforce and keep their skills up to date, in line with changes in the world of work.