Making a Success of the National Skills Fund - Adult Training and Retraining for All in the 2020s - NCFE
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Making a Success of the National Skills Fund Adult Training and Retraining for All in the 2020s March 2020 Michael Lemin and Julia Wright (Editors)
NCFE
NCFE is an awarding organisation which designs, develops and certifies nationally recognised
qualifications and awards.
www.ncfe.org.uk
Campaign for Learning
The Campaign for Learning is a national charity which works for social and economic inclusion
through learning.
www.campaignforlearning.org.uk
Disclaimer
The views expressed by contributors are those of the authors and, where relevant, not necessarily
the views of their respective organisations.
Previous NCFE and Campaign for Learning Policy Pamphlets
Earn or Learn for 18-21 year olds: New Age Group, New Policies
November 2015, Mark Corney
University or Apprenticeships at 18: Context, Challenges and Concerns,
April 2016, Mark Corney
Reforming Technical and Professional Education: Why should it work this time?
February 2017, Mick Fletcher
Mending the Gap: Are the needs of 16-18 year olds being met?
January 2018, John Widdowson
Shaping the new National Retraining Scheme
March 2018, Susan Pember
T-Levels for 19-23 Year Olds – The value of maintenance loans
August 2018, Mark Corney
The Post-18 Review of Education and Funding – A Review of a Lifetime
December 2018, Editors: Michael Lemin, Julia Wright and Mark Corney
Post-16 Education and Apprenticeship Levy Funding – Next Steps for English Devolution
April 2019, Editors Michael Lemin, Julia Wright and Mark Corney
Future Proofing Apprenticeship Funding in England for the 2020s, October 2019, Editors
Michael Lemin and Julia Wright
No 16-18 Left Behind – As the Cohort Grows, February 2020, Editors
Michael Lemin and Julia Wright
___________________________________________________________
2 Making a Success of the National Skills FundContents
4 Introduction
9 Stephen Evans, Learning and Work Institute
Renewing Lifelong Learning through the National Skills Fund
11 Tom Bewick, Federation of Awarding Bodies
Backing Adults - Turning the National Skills Fund into Skills Accounts
13 Mark Dawe, Association of Employment and Learning Providers
Funding Skills Accounts through the National Skills Fund
15 Ewart Keep, University of Oxford
A Dual Approach - Retain the National Retraining Scheme and Devolve the
National Skills Fund
17 Jamie Driscoll, North of the Tyne Combined Authority
Devolve the National Skills Fund to Elected Mayors and LEPs
19 Gemma Gathercole, Coventry and Warwickshire LEP
The National Skills Fund and Part-In, Part-Out Devolution
21 David Hughes, Association of Colleges
Bringing the National Skills Fund and Adult Education Budget Together
23 Simon Parkinson, WEA
The National Skills Fund – Engaging the Whole Community
25 Kim Chaplain, Centre for Ageing Better
The National Skills Fund – No Older Adult Left Behind
27 Greg Wade, Universities UK
HE and FE must collaborate over the National Skills Fund
29 Andy Westwood, University of Manchester
From the National Skills Fund to a ‘Right to Retraining’
31 Mark Corney, Policy Consultant
The National Skills Fund - Creating a Retraining Revolution
3Introduction
We enter the 2020s when adults In February 2020, the investment in staff retention, skills,
and employers are confronted government outlined its new- technology and automation.
with unprecedented economic skilled based immigration policy
and labour market change. using a points system. The temperature is rising over
whether special arrangements
Longer Working Lives From 1st January 2021, a high- – or carve-outs – should apply
skilled worker route will be to sectors requiring low skilled
The state pension age will introduced. Workers from any migrant labour. Key sectors
increase to 66 in October and country in the world will be able include construction and adult
rise again to 67 between 2026 to apply for jobs sponsored by social care. The government has
and 2028. Longer working lives UK employers requiring RQF3+ said it will keep under review
is a reality for thousands of older qualifications and paying above sectors adversely affected by the
adults in their fifties and sixties £25,600 per year. new skills-based immigration
who will seek to remain in paid system.
employment – as an employee, No cap on numbers is planned.
agency worker or self-employed Migration at RQF3+ could be Risks and Opportunities from
– up to and, indeed, beyond higher than 65,000 per year if Increasing Automation
state pension age because of UK companies take high skilled
economic necessity. migrants on as employees. Self- About 7% of jobs in the UK in
employment will no longer be an 2017 are at a high risk of being
Limits on Low-Skilled Migrant option. affected by automation and a
Workers further 65% of a medium risk of
The government does not plan being so. Workers most at risk
The working age population to introduce a low-skilled worker have qualifications at Level 2 and
in the UK is projected to rise route (jobs requiring RQF2 and below. Automation will gather
by 2.3m between 2018 and below qualifications). Nor does it pace as the 2020s wear on. Some
2027. This forecast includes an plan to introduce a self-employed job roles will disappear, new ones
assumption that net-migration worker route (irrespective of the will be created. Employment
will fall from 265,000 per year in RQF level). in some sectors will increase –
2018/19 to 190,000 by 2024/25. as jobs in new roles outweigh
From 1st January 2021, a cliff- declines in old ones.
At present, about 65,000 migrant edge low-skilled migration policy
workers – mainly from the could cut the labour supply by An Increasingly Flexible
EU – fill skilled jobs requiring 90,000 per year. On the other Labour Market
qualifications on the regulated hand, the government has
framework (RQF) equivalent decided to increase the number Over 25% of employees work
to Level 3 and above. These of migrants on the agricultural part-time, some 7m in total.
jobs might be on an employee, seasonal worker pilot from 5,000 More than 1 in 20 are temporary
agency or self-employed basis. A to 20,000 per year. workers. And 15% of workers are
further 90,000 migrant workers self-employed – now over 5m –
fill low-skilled jobs requiring RQF The rationale for restricting low- with self-employment becoming
Level 2 and below qualifications, skilled worker migration is to an important employment for
again as employees, agency shift the economy away from a workers aged 50 and over.
workers or self-employed reliance on cheap labour from
workers. Europe. The government wants Average earnings in real terms
UK employers to concentrate on has only just reached pre-2008
___________________________________________________________
4 Making a Success of the National Skills FundIntroduction
financial crash levels. Close to 1 form of A levels – and aged 19-24 must be swept away. Graduates
in 8 part-time workers would like or even older wishes to re-skill need to re-skill at any level they
a full-time job. And a quarter of to achieve a second Level 3 – wish, from Level 2 to Level 6.
temporary workers are looking usually in the form of vocational Non-graduates need up-skill to
for permanent jobs. qualifications. Level 6 if they wish but re-skill
at Level 2 and 3 if it meets their
The Need for Adults to Train Myths needs.
and Retrain
In the higher education world, Post-18 Education and
The need for adults to train and there is a strong belief that a Training
retrain is strong and obvious. graduate with a Level 6 who
Developing a system of post- needs to reskill means achieving a Our best estimate is that the cash
18 education and skills to meet second Level 6. Whilst this might cost of post-18 education and
these needs will be a challenge be the case for some adults with training in England in 2019/20
which the new Conservative graduate level qualifications, is about £22.4bn (See Table
Government must fulfill. many might choose careers 1). If these figures are correct
and occupations where a Level in general terms, 83.5% went
Up-skilling 2 or 3 is required or can only to higher education (i.e. Level
find employment requiring 4+) and 16.5% to adult further
We start the 2020s, with 30% of Level 2 and 3 qualifications. education, adult retraining and
19 year olds in England not having And so, re-skilling at Level 2 and adult apprenticeships which is
achieved a Level 2 in maths and 3 is the answer. In the further primarily at Level 3 and below
English – including functional education world, by contrast, (although Level 4-6 provision is
qualifications but primarily GCSEs there is an equally held belief growing through apprenticeship
– and 1 in 5 of 18-64 year olds that up-skilling is the priority funding).
without a Level 2 qualification with adults achieving a first Level
and more than 1 in 3 without 3 and progressing to first Level The Review of Post-18
Level 3 qualification. On current 4-5 and then first Level 6. Many Education and Funding in
trends, more than 10% might still adults, however, with a Level 3 England
not have a Level 2 qualification by qualification could be seeking
2027 and 26% without a Level 3. employment re-skilling at Level 3 Extending Up-skilling through
or Level 2. the Adult Education Budget
Increasing the proportion of the
adult workforce with a first Level A large amount of publicly One of the key recommendations
3, first Level 4-6 and indeed a funded post-18 education and of the Independent Panel
first Level 7-8 is a critical part of training funds up-skilling primarily Report to the Review of Post-
the policy challenge not least in the form of a first Level 4-6 18 Education and Funding (May
because employers are likely to qualifications. Add to this the fact 2019) was to create an all-age
demand workers with Level 3+ that higher education funding is entitlement to a first full Level 2
qualifications. And yet, the policy not generally available to support and a first full Level 3. Effectively
challenge is also about re-skilling. qualifications equal or lower than an up-skilling measure, the
a qualification achieved – the proposal was estimate to cost
Re-skilling so-called ELQ rule – FE policy £500m and would represent an
makers want to restrict graduates up-lift to the grant-based Adult
There are two classic examples of with Level 6 qualifications from Education Budget.
re-skilling. The first is from higher accessing public money for
education where an adult with a retraining because they have Re-skilling at Level 3 through
first Level 6 wishes to re-skill to had a large amount of taxpayer Adult Learner Loans
achieve a second Level 6. The subsidy already. If introduced, the all age
second is from further education entitlement to free training for
where typically 16-18 year olds As adult training and retraining a first full Level 3 in particular
achieve a first Level 3 – in the policy develops, these constraints
5would have a knock-effect on the Re-skilling at Level 4-6 through 4, 5 and 6 regulated degrees.
role of Adult Learner Loans – i.e. HE fee-loans If this is accepted by the new
fee-loans – in the adult further Conservative Government, adults
Another important
education sector. In effect, Adult seeking to re-skill at Level 4, 5
recommendation by the
Learner Loans would become a and 6 would be eligible to access
Independent Panel on Post-18
reskilling funding stream at Level fee-loans which would probably
Education and Funding was the
3 (noting that fee-loans at Level be part-time fee loans. A separate
removal of the ELQ rule for Level
4+ are relatively small). question, however, is whether
TABLE 1: ESTIMATED CASH COST OF POST-18 EDUCATION AND TRAINING IN ENGLAND: FY2019/20
HIGHER EDUCATION
Post-Graduate HE
Level 8: Doctorates Fee and Maintenance Loans £35m
Level 7: Masters Fee and Maintenance Loans £675m
Total: £710m
Undergraduate HE
Level 4-6: Full Time Fee-Loans £9,430m
Maintenance-Loans £6,840m
Level 4-6: Part-Time Fee-Loans £290m
Maintenance-Loans £60m
Total: £16,620m
Office for Students Teaching Grant £1,387m
TOTAL HIGHER EDUCATION £18,717m
ADULT FURTHER EDUCATION
Level 3-6 Fee-Loans £220m
AY: 2016/17 (i) L4-6: 19-23 £2m
(ii) L4-6: 24+ £12m
(iii) L3: 19-23 £35m
(iv) L3 24+ £140m
(v) Access to HE: 19-23 £16m
(vi) Access to HE: 24+ £40m
Maintenance Grants Linked to £35m
Adult Fee Loans (AY 2015/16)
Level 3 and Below Adult Education Budget
Provision £1,376m
Discretionary Learner Support (AY 2015/16) £86m
TOTAL ADULT FURTHER EDUCATION £1,717m
ADULT RETRAINING
National Retraining Scheme (Grant Funding) £55m
National Skills Fund 2021/22 £600m
TOTAL ADULT RETRAINING £55m
ADULT APPRENTICESHIPS
Level 2-7 English Apprenticeship Programme Budget
c£2,410m in 2019/20 - Assume 65% Adults £1,566m
TOTAL ADULT APPRENTICESHIPS £1,566m
OTHER
CITB Grants (FY 2018/19) Not all Adults £144m
ESF GRants (FY 2018/19) Not all Adults £198m
TOTAL OTHER £342m
GRAND TOTAL £22,397m
Higher Education - share 83.5%
Adults - share 16.5%
___________________________________________________________
6 Making a Success of the National Skills FundDIAGRAM 1: APPROACHES AND OPTIONS FOR THE NATIONAL SKILLS FUND
Funding Devolution Mechanism
Apprenticeship Levy Single Employer Employer – Grant - Account
HE Fee and Maintenance
Full-Time Single Adult Adult – Loan - Account
Part-Time
Adult Fee Loans Single Adult Adult – Loan - Account
National Retraining Scheme Sectors
Employers and Workers Affected by
Automation
Note: Scheme could be
- scrapped
- retained
- linked to National Skills Fund
National Skills Fund Option 1: Adult – Grant - Account
Single Adult
Adult Skill Accounts
Individual Learning Accounts
Adult Opportunity Grant
Option 2: Regional and Sub-Regional
Adults in a Region or Commissioning
Sub-Region with an Elected Mayor
Note: Opens up question about LEP Areas
Adult Education Budget Adults in a Region or Sub-Region with Regional and Sub-Regional
Elected Mayors Commissioning
Note: Opens up question about LEP areas
Combined National Skills Adults in a Region or Sub-Region with Regional and Sub-Regional
Fund and Adult Education Elected Mayors Commissioning
Budget
Note: Opens up question about LEP areas
16 - 18 Education Providers
adults re-skilling at Levels 4-6 Skills Fund from 2021/22 at a and construction training grants).
would be eligible for part-time cost of £3bn over five years. This £3bn investment is seen as a
maintenance loans. At £600m, the National Skills down-payment towards a Right
Fund would represent about to Retraining.
The National Skills Fund and a 3% of public spending on post-
‘Right to Retraining’ 18 education and training and Issues to Address
18% in public spending on adult
During the general election, further education, the National There are, perhaps, five separate
the Conservatives promised Retraining Scheme and adult but interrelated issues.
to introduce the National apprenticeships (excluding ESF The first is how the National Skills
7Introduction
Fund will relate to existing funding account mechanism can take participation. This is why policy
for post-18 education and the form of a loan account – to makers attempt to take the sting
training, and decisions by the new manage income contingent fee out of training and retraining
Government to take forward any and maintenance loans – or a by offering entitlement to free
of the specific recommendations grant account – also known as provision or provide access to
made by the Independent Panel. Adult Skills Accounts, Individual income contingent fee-loans
Learning Accounts or Adult which precludes up-front funding
The second is the level of Opportunity Grants. by adult learners. And yet, even
training and retraining the where provision is free or covered
National Skills Fund will support. And finally, there is the question by fee-loans, adult training and
The introduction of an all-age of whether the National Skills retraining might be held back by
entitlement to free training for a Fund should be brigaded in some income insecurity and low-pay.
first Level 2 and first Level 3 could way with other budget lines such
form part of the Adult Education as the Adult Education Budget In-Work Progression and
Budget, and re-skilling at Level although this would depend on Adult Training and Retraining
4, 5 and 6 should be funded the level of qualification since
through HE fee-loans. In turn, up-skilling at Level 4, 5 and 6 are At the Whitehall level, a major
adult fee-loans are available for funded via fee-loans and if the ideological difference exists
reskilling at Level 3. ELQ rule ceases so to would re- between the Department for
skilling at these levels. Work and Pensions, and the
The third is how the National Department for Education. For
Skills Fund will specifically Levelling-Up All Adults the DWP, in-work progression is
relate to the National Retraining through Training and about increasing weekly earnings
Scheme which among other Retraining through working extra hours. For
things has a sector focus. DfE, progression in work is about
Originally, the National Retraining We recognise the importance the investing in adult training and
Scheme was designed to recently returned Conservative retraining to secure and increase
assist employers and workers Government to levelling-up earnings in the future.
in a sector confronted by the deprived communities in England. Universal Credit is expected to
challenge of automation. The end Access to adult training and be rolled-out by 2024. A third
of low-skilled migration adds to retraining opportunities will of claimants will be in work.
the rationale for a sector focused enable adults, employers and Enabling adults claiming UC to
scheme. Even so, the National communities to level up. retrain through the National Skills
Retraining Scheme could be Fund without loss of benefit will
scrapped, retained – bearing in Even so, longer working lives, the be a critical policy challenge.
mind its potential sector focus impact of automation and flexible
– or linked in some way to the labour markets will impact the The Pamphlet
National Skills Fund. nation as a whole. Our position
is that every adult – whether 24 In this context, we asked twelve
The fourth is the nature and or 64 - should have the same authors to set out their initial
extent of devolution and whether opportunities to train and retrain thoughts on the National
the National Skills Fund is seeking from Blythe to Basildon, and Skills Fund and the journey
to support a specific employer Grimsby to Grantham. towards a ‘right to retraining’.
akin to the apprenticeship levy The contributions are rich and
and digital employer accounts Income Insecurity and Low diverse and have influenced the
in England, a specific adult (via Pay as a barrier to Adult preparation of this introduction.
account mechanism), a specific Training and Retraining We would like to express sincere
place (such as areas with elected thanks to all of our contributors
mayors) or indeed to providers Making a financial contribution to and invite everyone to read their
in line with 16-18 education the cost of a training or retraining thought provoking articles and
(see Diagram 1). In terms of course is rightly viewed by recommendations.
devolution to a specific adult, the policy makers as a barrier to in
___________________________________________________________
8 Making a Success of the National Skills FundRenewing Lifelong Learning
through the National Skills Fund
Stephen Evans, Learning and Work Institute
Lifelong learning matters young people to replace adults in individuals and employers. It sits
the workforce. alongside existing funds including
The case for lifelong learning the £1.5 billion per year adult
is widely made. Learning and Decade of decline education budget and £2.8 billion
improving your skills improves per year apprenticeship levy, as
your chances of being in work The bad news is that the 2010s well as the developing National
and climbing the career ladder. were a decade of decline in Retraining Scheme and Shared
It boosts productivity and lifelong learning in England. Prosperity Fund intended to
economic growth. But more Just one in three adults say they replace European Social Funds.
than this, learning helps people participated in learning in the This gives a real opportunity
be active in their communities, last three years, the lowest in the to innovate and tackle these
improve their health and 23 year history of Learning and structural challenges in a holistic
wellbeing, and access public Work Institute’s annual survey. way.
services which are increasingly This is partly because the adult
digital by default. education budget has been cut Recommendation 1: Take a
by around 45% since 2010. joined-up approach with local
This case is strengthening leadership
over time. Economic change, There are stark and profound
including advances in technology, inequalities in access to learning The National Skills Fund will
is changing the jobs available by socioeconomic group only work if we decide what
and the skills needed for them. and region, important for a it’s for and think about how all
Reports of robots taking our jobs Government that has promised the pieces of the jigsaw, the
grab the headlines, but advances to ‘level up’ opportunity across many other funding streams and
in technology are having a more the country. To tackle these policies, fit together.
profound and nuanced impact: challenges, we do need more
creating new jobs, replacing investment, but also new ways The National Skills Fund is
old jobs, and changing the skills of investing too. Our research a great opportunity to align
needed in many current jobs. shows a need to inspire people new skills provision with
There is a rising bar of skills to want to learn, support people infrastructure investment and
needed to get into the labour with the cost of learning, and find priorities identified in national
market at all, and a changing set ways to fit learning around work and local industrial strategies.
of skills needed over time in the and home life. It also shows clear In this way we can help boost
same job or to retrain for a new gaps in existing policy: support economic growth, which has
career. is limited for those looking to been weak since 2008 in part
retrain and, while apprenticeships because improvements in skills
Meanwhile, longer working lives, are great, by definition they are have stalled. We need to avoid
with 50 year careers becoming not an option for people who a predict and provide approach.
the norm, means people will be are self-employed (you cannot But what about focusing effort
living with this changing labour apprentice yourself). on co-designing provision in
market for longer. Adaptability, key sectors in different parts of
updating skills and changing Toward a National Skills Fund the country with employers and
careers will be essential. At the trades unions? And making this
same time, an aging population The National Skills Fund is provision free at all levels for
means that 80% of our 2030 expected to be worth £3 billion those that need it?
workforce have already left over the next five years, and aim
school: we cannot simply wait for to match contributions from We should also empower local
9Stephen Evans - Renewing Lifelong Learning through the National Skills Fund
areas, such as Mayoral Combined or numeracy, and even more benefit them. Let’s test new ways
Authorities, to lead and use with low digital skills or those to inspire and engage adults in
their convening power to join without a level 2 qualification. learning.
up support. Beyond this, their This is increasingly a barrier both
role could be anything from the to finding work and to being We could also test, in new
ability to set financial incentives adaptable to changes in the provision designed with
to target provision on Local workplace or need to change employers aligned with
Industrial Strategy priorities careers. Yet the number of adults the Industrial Strategy, new
through to full responsibility for improving their skills has fallen approaches to supporting
commissioning the fund, perhaps by more than one third in recent people with the non-course
based on outcome agreements years. costs, such as maintenance,
setting out what will be achieved of learning. We would need to
through the funding (such as the The National Skills Fund should, rigorously evaluate all these
number of people finding work). therefore, have as much focus on new approaches, encourage
increasing take-up of basic skills innovation from providers, and
Recommendation 2: Focus on as it should on promoting level build in work to disseminate
learning at all levels 3 learning. And learning should these findings. That would help
mean modules as well as full us build the evidence base on
We need to increase the qualifications – flexibility is key. what works, and spread the use
proportion of people qualified of best practice more widely.
at levels 3 and above, and to Recommendation 3: New
help people already qualified at approaches to engagement
this level to retrain where they and delivery
need to. That’s something the
National Skills Fund could usefully The National Skills Fund is an
do, given it’s not something the opportunity to design and test
adult education budget currently new approaches. For example,
supports well. Learning and Work Institute’s
However, this should not be at research shows that many adults
the expense of the nine million don’t even think about learning
adults who have low literacy or how improving skills could
___________________________________________________________
10 Making a Success of the National Skills FundBacking Adults - Turning the
National Skills Fund into
Skills Accounts
Tom Bewick, Federation of Awarding Bodies
20% of the Workforce Under- 2010. It is just 0.3 per cent per Skills Fund has a real job of work
Skilled for Their Jobs by 2030 annum today compared to the cut out to try and improve, or
long-term trend rate of growth at least reverse, some of these
Andy Haldane knows a thing or for the British economy of negative trends. The new national
two about the UK’s skills and around 1.75 per cent. imperative – given that 80 per
productivity puzzle. As the long- cent of the workforce will still be
standing chief economist at Official unemployment is in employment in 2030 – must
the Bank of England, he’s had a currently low by historical be to shift the entire skills base
ringside seat on developments in standards, yet, under- up the value chain; creating
the British economy – both pre- employment – particularly better quality, higher-wage, more
and post the 2008 financial crisis. amongst graduates – is at an all- environmentally friendly and
The historic weaknesses in the time high. The Office for National digitally-based jobs.
country’s vocational skills base Statistics (ONS) estimates that
is what he calls: “the collapsed 31 per cent of millennials, who To achieve this, the National Skills
left lung of the UK’s education studied bachelor’s programmes Fund must essentially deliver on
system.” at Level 6 and above after 2007, three key aims.
graduated into job roles that do
As chair of the UK government’s not require a university degree. The first aim of the National Skills
Industrial Strategy Council, Fund must be to halt the collapse
Haldane hasn’t pulled any Redressing a Decade of in post-compulsory participation
punches about the scale of the Lifelong Learning Going in lifelong learning which has
challenges ahead: He says: Backwards seen a reduction of 4 million
adults taking up opportunities
“The ISC estimates that These major mismatches, that since 2010, according to the
an additional 7 million a number of economists and Learning and Work Institute’s
people – 20 per cent business lobby groups have long respected annual participation
of the workforce will be pointed to, coincide with over a survey.
significantly under-skilled decade of going backwards in
for their jobs by 2030; and lifelong learning policy. A perfect Second, there is an enhanced
another 1 million will be storm has gathered around falling role for government and the
over-skilled. That will leave participation levels in learning; private sector coming together to
many more workers less reductions in employer workforce tackle skills gaps and shortages
productive in their jobs or investment; over-reliance on on a more geographical and
out of work completely” low-skilled migration from the sectoral basis. The Confederation
(Worsening UK skills gap EU; government austerity cuts of British Industry (CBI) has
will hold the country back, disproportionately affecting FE called for the “partnership of the
Financial Times, 24th colleges; and weak linkages century” which, in part, is to deal
October 2019.) between higher-education with the fact training investment
expansion and productivity per employee has actually fallen
Low Productivity and Under- improvements in the economy as in the UK, by an average of 23
Employment a whole. per cent since 2005 (British
firms invest five times less per
To compound matters still Three Aims for the National employee than their German
further, wage growth – a key Skills Fund counterparts, according to cross-
measure of increases in output national studies funded by the
per worker – has slumped since Against this context, the National European Commission).
11Tom Bewick - Use the National Skills Fund to finance Adult Skill Accounts
And third, post-compulsory that is earmarked to come with has the potential, over time,
public spending on education it, is a recognition at least, that to help reduce the country’s
and training needs to be for too long the patient has been reliance on low-skilled labour
rebalanced towards higher hooked up to basic life support. from overseas. The National
technical qualifications at Levels Now is the time, in the words Skills Fund, perhaps topped up
4 and 5 (sub-degree level), as well of the Prime Minister, Boris from the fees employers and
as ensuring the ‘skills progression Johnson, to “level-up” education individuals will have to pay to
ladder’ of opportunity is not and skills investment across the acquire new work visas, could
kicked away by the Department whole country. That is ultimately be specifically targeted at those
for Education by removing – how the UK’s productivity puzzle sectors – like health, hospitality
too hastily or crudely – many can and will be solved. and social care – which have
important qualifications at Level in recent decades overlooked
3 and below. Apprenticeships Recommendation 1: Adult attracting, retaining and retraining
might be excluded from the Skill Accounts funded through the resident labour force.
scope of the National Skills Fund, the National Skills Fund
but reform of the employer Levy Recommendation 3:
could benefit from being co- We know from past experience Introduce a ‘Right to Time Off
ordinated with other forms of that the Individual Learning to Retrain’
post-18 education and training Accounts concept was a
spend. Indeed, there is an popular one amongst adult Linked to new skill accounts,
argument to consolidate all forms learners. The problem was not the government could look at
of non-schools-based funding so much simulating demand, statutory legislation to give all
into a single National Skills Fund, but weak implementation of the employees, with workers aged
including HE student finance, scheme, which led to fraud. A over 35, the ‘right to retrain.’
with tripartite contributions reintroduction of more secure The legislation would grant
from the state, employers skills accounts, linked to a lifelong employees a statutory right to
and individuals collected and learning entitlement to retrain request up to 8 days annual
disbursed via the tax system. in accredited qualifications that ‘learning leave.’ The self-
meet specific skills needs up to employed would receive tax
Level 5, could be just the kind of credits in lieu of the time taken
Breathing New Life into kick-start the British economy off. All or even a more limited
Lifelong Learning needs. combination of these measures
would help create additional
What is clear is that breathing Recommendation 2: Targeting demand and boost productivity.
new life into the economic lungs Sectors No Longer Able to
that will drive Britain’s future Recruit Low Skilled Migrant
prosperity, skills and improved Workers
productivity performance, will
take some time to fully realise. As the country recalibrates to
Skills 4.0 and the fourth industrial life outside of the European
revolution beckons. Union and an end to Freedom
of Movement with the EU27
The National Skills Fund, in January 2021, the intended
including the extra investment points-based immigration system
___________________________________________________________
12 Making a Success of the National Skills FundFunding Skills Accounts through
the National Skills Fund
Mark Dawe, Association of Employment and
Learning Providers
Two Schemes AELP has called for the creation
of a form of adult traineeship National Skills Fund Financed
Since the general election for both the unemployed and skills accounts
manifesto commitment, we have employed participants through
learnt that there will be a tie-up the scheme. Its recent shaping The faults with the original
between the proposed National into an information-sharing individual learning accounts
Skills Fund and the National platform simply duplicates largely relate to failures in quality
Retraining Scheme. The latter of existing government-backed job control. Addressing these
course owes its conception to a signposting initiatives. should be at the forefront of a
previous manifesto but progress relaunch of skills accounts and
in getting it off the ground under What’s needed is a clearly defined we should start by ensuring that
its ‘Right to Retrain’ brand has set of outcome and progression their funding is routed through
been slow. measures within a proper training a robustly tested and approved
scheme, with providers being provider base as opposed to the
The National Retraining financially incentivised to support unmanageable 8,910 providers
Scheme participants to both complete that previously accessed
and progress. At present, the lack funding for individual learning
AELP hopes that the £3bn of investment in core delivery and accounts. This is not about
allocation for the Fund over the provider participation funding is restricting access to the market
course of the new Parliament a weakness and there’s a danger for new providers who offer
doesn’t all get channelled into that government will repeat the innovation and competition but
the National Retraining Scheme. mistakes made with the Employer learning from past mistakes and
It is true that we were one of Ownership of Skills pilot which experiences from programmes.
the organisations who said that over five years until 2017 saw
the £100m initial funding for the £350m of taxpayers’ money The government should control
scheme wouldn’t be enough to completely wasted. the breadth of qualifications
make a tangible impact, but on and programmes available for
the basis of what we have seen The National Skills Fund individuals to buy with their skills
so far, a further injection of £3bn account with a catalogue of
would be unwise and difficult to AELP believes that the National approved programmes, building
justify. Skills Fund gives us the on the lessons from advanced
opportunity to bring back skills learner loans and the use of an
Irrespective of whether much accounts twenty years after approved central qualifications
more funding will be allocated to the experiment with individual catalogue. In 2013 for the launch
the National Retraining Scheme, learning accounts went so of advanced learner loans,
the government should work badly wrong. The link-up the ESFA produced a central
with employers, trade unions and with the National Retraining online catalogue of fundable
training providers to transform Scheme makes sense because programmes which is regularly
the programme to really make one of the areas in which updated. Having a similar
a difference to the 1.5 million skills accounts could make an catalogue for skills accounts
individuals whose jobs are at impact is supporting the right would be a sensible way forward.
risk of automation along with to retrain. Other target areas
supporting those trapped in should include: the digital skills Digital Skills Accounts
low-level employment with little entitlement; level 2 and level 3
prospects. entitlements; Higher Education The National Skills Fund should
and Advanced Learner Loans actively embrace the latest
funding; and maths and English.
13Mark Dawe - Funding Skills Accounts through the National Skills Fund
technological advancements to enables it to flexibly direct Recommendation 2:
enhance, control and protect funding to support additional Reintroduce Skills Accounts
the integrity of the skills account specific targets to meet new or financed from the National
system. This means identifying developing needs; for example, Skills Fund
trends quickly, with the ability to it could include an amount in
suspend or investigate accounts an account to fund training The government should
based on specific behaviours on digital skills development. reintroduce skills accounts
or patterns, be that by learner An account should be able to financed from the National Skills
type, geographical location or by facilitate a mix of grants and loan Fund and drawing on lessons
programme/qualification type. funded provision in one place, from the first individual learning
acting as a one-stop shop for the account experiment.
We shouldn’t always expect individual to control and make
government alone to shoulder informed choices.
Recommendation 3:
the full responsibility to meet
Individual Choice to Drive use
the total cost of the investment Recommendation 1: Retain
required. In addition to the of Skills Accounts
the National Retraining
entitlements and access to Scheme
loans, there could be incentives Skills Accounts should be
for individuals and employers designed in such a way as to
The government should retain allow individual choice from a list
(and even combined authorities) the National Retraining Scheme
to top up a skills account for of approved courses but enables
to meet the needs of adult government to direct funding to
targeted training. Incentives workers whose jobs are at risk
could be in the form of tax relief, specific priorities.
from automation and use some
national insurance contribution of the National Skills Fund to
relief or rebates. finance it but by no means
The government should structure exclusively.
skills accounts in a way that
___________________________________________________________
14 Making a Success of the National Skills FundA Dual Approach - Retain the
National Retraining Scheme and
Devolve the National Skills Fund
Ewart Keep, University of Oxford
A Right to Adult ‘Training and In any event, the National profiles and requirements altered,
Retraining’ Retraining Scheme is the vehicle sometimes in quite profound
for a sectorally-focused attempt ways. Workers across different
The National Skills Fund’s to reach out to employers over sectors and occupations, at
underlying long-term aim is adult skills and there is little very varied skill levels are likely
stated to be moves towards a point in the National Skills Fund to need to upgrade and change
‘right to train’, analogous to (how duplicating this approach, not their skills, not least if employers
is unspecified) the Conservatives’ least as experience with the levy continue to retreat from offering
famous ‘right to buy’ (the council suggests that this road ends in substantive training to the bulk of
house you live in). Does this deadweight. In other words, their employees.
focus on the individual make public money ends up supporting
sense? training that employers would Recommendation 1: A step
otherwise have had to undertake change in IAG for Adults
The overall answer seems to and pay for themselves. linked to the National Skills
be ‘yes’. There are huge adult Fund
learning challenges looming The employer-focused strand of
and the trend has been one adult learning policy will, sooner First, we need to address
of decline in both individual or later, have to try to nail down the current inadequacies in
participation and a huge fall what employers are responsible information, advice and guidance
over time (60% in the volume for and fund. Don’t hold your (IAG) which render it extremely
of training days between 1997 breath! difficult for adults to understand
and 2017) in employer-provided the shape and direction of travel
learning opportunities. As ever, Adult Focused - Regionally within their local labour markets,
the nature and scale of the Devolved – ‘National Skills or to know what learning
rights, roles and responsibilities Fund’ opportunities and options they
of employers within our skills may be able to access to help fit
system unfortunately remain as The second strand of policy them new opportunities. Unless
nebulous and ill-defined as ever. development covered by the we deal with this and put in
Even so, the government needs National Skills Fund needs to place a high quality IAG offer that
to develop a dual policy for adult adopt an individual focus and provides a blend of computer
training and retraining. to offer tailored support to and face-to-face based support,
adults who want to up or re-skill the National Skills Fund is very
Sector-Focused ‘National themselves, either in order to unlikely to be able to deliver what
Retraining Scheme’ progress within an occupation is needed for individuals.
or sector, or to change
First, on what employers need to jobs, perhaps in the face of Recommendation 2: Setting
start doing. The existing National technological change. It would the right output measures for
Retraining Scheme is already be unwise to assume, as some the National Skills Fund
piloting how best to work with commentators do, that only
firms to re-skill workers facing lower level workers are going Second, there is a need to think
technological change and to be impacted by digitalisation hard about what the outputs
potential redundancy. It is still and automation. It is clear from and performance indicators
early days, but rumours suggest emerging research that many for National Skills Fund activity
that employers are proving hard graduate level jobs (for instance, should be. In the past, there
to engage with. in legal services) will be impacted has been an obsession with
by digitalisation and their skills imparting full qualifications –
15Ewart Keep - A Dual Approach - Retain the National Retraining Scheme and Devolve the National Skills Fund
witness New Labour’s Train to learning packages. Designing have started to do with their
Gain programme. It is doubtful and developing these kinds of devolved Adult Education Budget
whether this approach is what courses and finding appropriate allocations. There have been
is either wanted or needed by and enthusiastic providers to interesting attempts to slim
all adult learners. For a lot of deliver them is likely to be by no down the number of contracted
adults, time, energy and money means simple or easy. providers, offer more courses
are in short supply, and learning that target a gap in provision at
structured around monolithic Recommendation 3: Pilot levels 2 and 3 for adults in work,
full qualifications will be off- Regional Devolution of the and give financial incentives
putting. For some, perhaps National Skills Fund to providers to innovate. The
many, what they will be seeking is Combined Authorities may
the opportunity to access bite- Third, the policy makers be ideally placed to pilot the
sized chunks of learning, perhaps developing the design of the National Skills Fund.
certificated through micro- National Skills Fund would
qualifications or credits, which do well to look at what some
over time can be assembled and of the combined authorities
aggregated into more substantive
___________________________________________________________
16 Making a Success of the National Skills FundDevolve the National Skills Fund to
Elected Mayors and LEPs
Jamie Driscoll, North of the Tyne Combined Authority
From the Adult Education market could be under-skilled funding commissioner for the
Budget to the National Skills for their job requirements. If skills Adult Education Budget in
Fund mismatch in the UK’s labour Newcastle, North Tyneside and
market is projected to worsen, Northumberland. This allows us
The additional opportunities the then we need to mitigate against to focus funding of approximately
National Skills Fund will offer are this by making lifelong learning £22million on the current
welcome. This, in conjunction the norm. challenges facing our region;
with our newly devolved Adult high levels of worklessness
Education Budget will start to These lifelong interventions will and economic inactivity, low
address the decline we’ve seen in vary by sector and job role, but employment rates and high in
the adult education participation workplace skills set to experience work poverty.
rate in the North East, which the most acute under-skilling
according to the Learning and in 2030 are basic digital, STEM In the longer term, our economy
Work Institute has the lowest and social and emotional skills. will shift toward growth in sectors
proportion of adult learners in Unison has identified that digital, such as digital and technology,
2019. supervisory and management financial and professional
skills are most needed in the business services, health and
Any new money that is coming workplace, with older workers life science, energy, offshore
into the Combined Authority needing more computer and and advanced manufacturing
from central government is a digital skills. and tourism, leisure and culture.
fraction of the money that a We are going to work with our
decade of austerity has taken The National Skills Fund is ideally providers to drive our residents
away. These are our taxes being placed to respond to these skills toward opportunities in these
returned to us. As the IFS has needs. The Fund shouldn’t be sectors.
stated, the proposed £600m per prescriptive in the courses or
year National Skills Fund would sectors it will support and be We will also be supporting
‘reverse about one fifth of the flexible enough to allow each already excellent local provision.
cuts to total spending on adult MCA to respond appropriately There will be ongoing skills
education and apprenticeships with the best fit provision for replacement needs as people
since 2010’. lifelong learning, through the leave the workforce, with analysis
appropriate learning providers. showing that the North of Tyne
Safeguarding the Skills of our area also has skills shortage
Workforce Creating Synergy within the vacancies in Transport, Business
North of Tyne Combined Services & Education and the
By devolving this fund to Mayoral Authority wholesale & retail sectors. We
Combined Authorities (MCAs), are also mindful of economic
regions will be empowered We are keen to avoid duplication shocks that may be forthcoming
to safeguard the skills of their and ensure alignment of skills and be ready to respond to these
workforce and will be trusted to interventions. There is an obvious through our provider network.
make the best decisions for the synergy between a National Skills
future prosperity of their region. Fund targeted at adults and the And we will be working with
work ongoing devolution of the further education colleges and
This additional investment is Adult Education Budget. local authorities based in and
sorely needed. Industrial Strategy around the North of Tyne area to
Council analysis has found that From August this year, the address these challenges, whilst
by 2030, about 20% of the labour NTCA will become the also working with innovative
17Jamie Driscoll - Devolve the National Skills Fund to Elected Mayors and LEPs
and high-quality providers skills interventions in a region. smaller businesses that have
selected through last year’s This will ensure that we make difficulty accessing training and
procurement activity. Ideally adult education meaningful and development opportunities
more local and smaller providers tailored to the individual, not the through other channels.
should be involved upskilling institution. A route to richer lives,
their workforce, the National not just better trained workers. Recommendation 3: Use the
Skills Fund is an opportunity to National Skills Fund to Fund
support smaller business that Recommendation 1: Devolve Flexible Provision
have difficulty accessing training the National Skills Fund to
and development opportunities Regions and LEPs The National Skills Fund should
through other channels. not be restricted to courses or
The £600m per year National sector and be flexible enough
The National Skills Fund will Skills Fund should be devolved to to allow each region to respond
provide wraparound support and commissioned by Mayoral appropriately with the best fit
for this activity by taking our Combined Authorities (where provision for lifelong learning.
residents beyond their initial they exist) and Local Enterprise
levels of training and build a Partnerships.
culture and habit of lifelong
learning and opportunity. Recommendation 2: Use the
National Skills Fund to Assist
It makes sense for MCAs to Small Firms to Train
take on this commissioning, to
ensure that it complements, and The National Skills Fund
does not compete with, existing should be available to support
___________________________________________________________
18 Making a Success of the National Skills FundThe National Skills Fund and
Part-In, Part-Out Devolution
Gemma Gathercole, Coventry and Warwickshire LEP
Local Enterprise Partnerships full membership and voting a postcode lottery of provision
rights, including voting for the and access.
At the core, local enterprise West Midlands Mayor. However,
partnerships are about Warwickshire County Council We cannot escape that funding
collaboration. They are business and four of the five district drives behaviour. What is needed
led partnerships between local councils are non-constituent is better access to information
authorities and local private members, which gives them less about what skills are needed in
sector businesses, playing a voting rights, they do not vote on the labour market, while this is
central role in determining the Mayor and are not part of the relatively easy to do in the short
local economic priorities and devolved Adult Education Budget. term, it’s much harder in the long
undertaking activities to drive term.
economic growth and job This in and out reality gives us
creation, improve infrastructure an unusual perspective on the The National Skills Fund is
and raise workforce skills within impact of devolution and the needed to support individuals
the local area. issues that arise from imposing to access training that leads to
policy borders that create dividing better paid, more secure work, to
Coventry and Warwickshire lines that people, jobs and skills enable them to progress in their
Economy needs do not recognise. chosen careers and, should they
want or need to, it should allow
The economy of Coventry and National Skills Fund them to retrain in another sector.
Warwickshire builds on its central For employers it should provide
location, distinctive businesses, Read any report on skills and access to a pool of suitable
innovation assets and highly you will be clear that we have a talent for their roles or support
talented workforce. Coventry skills gap in the UK. What is less them in accessing training to
and Warwickshire is recognised clear is any form of consensus upskill where there isn’t a pool of
as a global hub in the advanced over how we can address it. suitably qualified applicants.
manufacturing and engineering The reasons for the skills gap
sector, with business and are numerous, complicated and Recommendation 1: Allow
research links across the world. interconnected. decisions to be made locally
It is a major player in the Digital
arena which plays a key part in We can and should make the At local levels, business support
the local economy. system easier for individuals providers and intermediary bodies
and employers and for training can have detailed conversations
A Mixed Devolution Area providers to deliver. As a Local with individual businesses to
Enterprise Partnership within a understand the support required
But in the context of devolution, devolved area, we have some by businesses, the National Skills
this doesn’t explain the whole experience of implementation Fund needs to replicate this for
story. While Coventry and and some lessons to learn for the skills training.
Warwickshire LEP is a non- skills fund.
Constituent member of the West When examining data for skills
Midlands Combined Authority, There is a fine tightrope for the needs, it is easy to aggregate and
our partner local authorities and National Skills Fund to tread in come to a conclusion that there’s
district councils have different order to be a success. It needs enough commonality of requests
positions. Coventry City Council to be sufficiently locally focused that national policy and national
is one of seven Constituent Local to respond to skills needs in local entitlements can appropriately
Authorities, which gives them areas, but not too local to create serve skills needs, but there are
19Gemma Gathercole - The National Skills Fund and Part In, Part Out Devolution
different emphases when you While, WMCA constituent to access more than one
look at the data available in residents can access a more intervention, probably over time
smaller geographic areas. The flexible and locally defined offer, but a skilled Engineer does not
qualification levels of Coventry Warwickshire residents can only enter the workforce day 1 at
and Warwickshire are generally access the national offer. This the highest level. A senior care
high, but within that there’s complexity will only increase worker was probably a junior care
great variety and across the with further devolution and given worker at one stage. Put simply
employment landscape there’s a that the UK workforce doesn’t the expert at anything was once a
great diversity of industry, which always live and work in the same novice. The National Skills Fund
makes any attempt to capture a area, never mind post code, the and probably the skills system
single picture a challenge. skills fund needs to understand more widely needs to support
individual mobility a little more. individuals to understand not only
Recommendation 2: Avoid a the breadth of opportunities but
Postcode Lottery Recommendation 3: Work also the pathways to achieving
Collaboratively them and the pathways within
While it might feel a little that career as a whole and that
contradictory to the above, our The National Skills Fund will not needs FE, HE, employers, local
experience of devolution tells exist in a vacuum and we can’t authorities, LEPs and others to
us to be cautious of creating expect wholesale change to the support a more collaborative
artificial dividing lines. Our machinery of government and approach.
providers, especially those in particularly to the skills system
border locations, now have to institutions. And so, there needs
maintain two different offers to be a greater emphasis on
– that supported by the West collaboration. The reality is that
Midlands Combined Authority individuals needing upskilling
and that of national entitlement. or reskilling will probably need
___________________________________________________________
20 Making a Success of the National Skills FundBringing the National Skills Fund
and Adult Education Budget
Together
David Hughes, Association of Colleges
A Nice Problem to Have Consult in Partnership
How will the National Skills
We have a nice problem – how The promised approach of Fund fit with Other Post-18
to help the Government decide engaging and consulting on Programmes?
how to spend £3bn over the the design of the National Skills
next 5 years on a programme Fund is a great start, but we need If those drivers result in those
which feels at the moment like to ensure that it continues into challenges, then we can start
a fairly blank sheet of paper. implementation, monitoring, to see a world in which the
The commitment was one of review and the inevitable emerging National Retraining
relatively few in the Tory party tweaking and adapting that will Scheme could be linked closely
election manifesto, and shows be needed to make it work. Co- to the Adult Education Budget
that skills and colleges are design is important, but shared to provide opportunities for
significantly higher priorities than destiny is equally essential. people with lower level skills and
for a long time. education needs.
Seismic Changes
Three Risks A reformed apprenticeship
The seismic changes happening scheme could help people move
It is a nice problem to have, but in our world – technology, into the semi-skilled and skilled
there are 3 key risks which must climate crisis and demographic jobs which employers will find
be avoided. First, we will need to changes - are starting to have hard to recruit to. Leaving the
help officials resist the threat of profound impacts. Brexit and its new National Skills Fund to be
‘urgency’ which besets many new impact on immigration will also focused on people already in
policies and programmes. I’ve be an important driver for labour work who need a module or two
seen too many sound reforms go market pressures. Making sense of new skills in their profession/
pear-shaped when politicians ask of that is not easy, but three big craft to be able to stay current
for quick results – Train to Gain, challenges are likely to dominate and be productive. A module or
Individual Learning Accounts for adults. two which can also add up to full
and the current apprenticeship qualifications over time, delivered
reforms come to mind. The first is the need for more flexibly to help fit with people’s
adults to have good literacy, lives and work.
Secondly, we should work hard numeracy and digital skills in
to achieve as much clarity as order to be able to learn new If the National Retraining
possible about the purpose and things to stay active in the labour Scheme, Adult Education
the success measures of the market. The second is that people Budget, Apprenticeships and
programme. Let’s not accept already in work will need to learn the National Skills Fund could
muddled thinking, or overly new things as their jobs, sectors be properly aligned, colleges
ambitious, lofty aims. and employers transform. And should be funded once to
third is that employers will find deliver all of them. That would
Thirdly, we need to make sure it increasingly difficult to recruit cut the bureaucracy and make
that we do everything we can skilled and semi-skilled people the system more coherent for
to make sure it fits with other in many sectors where colleges everyone – colleges, employers
existing policies and programmes provide the bulk of the current and students alike.
and does not increase skills provision.
bureaucracy and complexity for Policy makers should also go a
colleges, employers or students. bit further though, because we
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