I am grateful for the opportunity to introduce this debate on the very important matter of the funding of Scottish colleges of further education. Perhaps a better title for the debate would be "The underfunding of Scottish colleges of further education", because the underfunding is so serious that some colleges are rapidly approaching a crisis.
Many of the problems stem from 1993, when the Government removed Scottish colleges of further education from local education authority control. Before 1993, there was a strong element of local control and accountability, and local education authorities were able to take decisions to improve the funding of the further education colleges, taking into account local circumstances and priorities.
However, since incorporation was introduced in 1993, the 43 colleges have depended almost entirely on central Government instead of local government for funding. Since the financial year 1994–95, there has been a cut of grant in aid from £241 million to £230 million, with a further planned reduction to £211 million by the year 1998–99, making a total reduction at 1994–95 prices of £30 million or 12.5 per cent., yet there has been an increase of 23 per cent. in full-time equivalent student numbers since incorporation and an increase of 50 per cent. in students taking higher education courses in FE colleges. The Minister may tell us later that the revenue element for the current financial year increased compared with that for last year, but the extra revenue was funded by cutting the capital element.
Twenty-eight of the 43 colleges have suffered real cuts in income this year, and although the cut for any individual college has been limited to a maximum of 5 per cent.— about 8 per cent. after taking inflation into account—there is no guarantee that there will be such a limit next year. The consequences for many colleges have been very serious. Twelve colleges suffered the maximum cuts, including some of the largest colleges in Scotland, such as Bell, Dundee, Fife and Inverness, as well as some of the smaller colleges, such as Coatbridge and Thurso. Another victim of the maximum cut is the Jewel and Esk Valley college, which suffered such a bad cut last year that the management resorted to compulsory redundancies.
The underfunding has been exacerbated by the fact that Scottish Enterprise is also cutting its training budget, which in effect will reduce the income to colleges that participate in training schemes funded by local enterprise companies.
Responsibility for student bursaries has been transferred from local education authorities to the colleges, but despite the increasing number of students the total amount for bursaries has been frozen at £45 million a year for the next three years. As a result, many students will inevitably suffer considerable hardship.
It is ironic, too, that at a time when the number of students is increasing the number of staff in many colleges is decreasing. Last year saw the first ever compulsory redundancies, and more jobs are threatened if the underfunding continues. At Falkirk college in my constituency, the college authorities have apparently run out of volunteers opting for early retirement; and the Scottish Office pension scheme for early retirers is limited to employees over the age of 50. Since incorporation, more than 100 employees, including teaching and support staff, have left Falkirk college. The financial restrictions imposed by the Government also have a limiting effect on salary negotiations. That in turn has an adverse effect on staff morale.
Education is not, however, simply a job for teachers and lecturers. Teachers' jobs are very important, of course, but what is even more important is the valuable service that teachers provide by improving the educational, training and job opportunities of students—including the 200,000 students who attend Scottish colleges of further education. If there is a significant reduction in the number of teachers, that could lead to larger class sizes, and it could have an adverse effect on the quality of education.
There is also a danger of some entire courses being discontinued, and even of the scrapping of whole areas of the curriculum. Specialist courses will be available in fewer colleges, so students will be obliged to travel further and colleges may feel obliged to drop courses whose cost per student is relatively high—for instance, in construction and engineering.
The Government have also frozen the intakes to higher education courses in FE colleges and have stopped the introduction of new higher national certificate, higher national diploma and degree courses. Yet Ministers tell us that they agree about the need to increase the number of people who are educated and vocationally trained to high standards.
This country does not compare well with our major industrial competitors in the proportion of our work force with full craft and technician qualifications. The FE colleges have a key role in providing such qualifications, which are essential to our economic and industrial regeneration. It therefore does not make economic sense to deprive the colleges of the resources to do the job.
The cuts also affect buildings maintenance and equipment, and students will find it difficult to reach their full potential if they are in oversized classes, in overcrowded classrooms or ill-equipped workshops. Later, the Minister may refer to the private finance initiative, but the PFI will not be enough to renew or replace dilapidated buildings or obsolete equipment; and some colleges may be forced to cut recurrent expenditure in order to fund essential capital projects.
The reason for the crisis facing many colleges is not just the inadequacy of the total grant in aid from the Scottish Office. There are also allegations about the unfairness of the formula used to allocate to each college its share of the grant. The total grant is divided up according to SUMs, or student units of measurement, generated by each college in the previous financial year. A SUM is defined as 40 hours of teaching delivered to a student.
Although some other factors are also taken into account, there is considerable concern that the formula does not take sufficient account of the diversity of the 43 college system. Some colleges are large, others are small. Some are in urban areas, others in small towns or rural areas. Some are polytechnics, others are virtually monotechnics. Some may have stronger community links than others.
The larger colleges complain that all 43 colleges receive the same amount of "institutional factor", irrespective of size. The institutional factor currently amounts to about £250,000 a year, which can be as much as 10 per cent. of the budget of a small college, compared with only 2 per cent. of the budget of a large one. The polytechnics complain that the formula discriminates against them because they have a greater proportion of higher education courses—for example, higher national certificate courses—which are more expensive to operate but which attract less money than further education courses under the existing formula. Yet the skills gap in this country is mainly at HNC or SVQ III and IV levels, which—ironically—are the worst funded courses in Scottish FE colleges.
The formula also discriminates against colleges in areas with low potential for assistance from the European social fund or the European regional development fund. This could amount to a difference of as much as £1 million a year between the amounts of help available for colleges of similar size.
There are also complaints about the fact that the funding is based on past student numbers, thereby limiting the opportunity to fund future developments, especially if high capital investment is required for new proposals. Such projects at Falkirk college would include biotechnology, food technology, petrochemical plant and mechatronics. The college management has set the laudable objective of becoming mid-Scotland's polytechnic by the year 2000, but Government underfunding will make it more difficult to achieve that objective.
The volatile operation of the funding formula has also been criticised. It tends to produce some large annual variations in the budgets of some colleges, so that it is quite possible for a college to make people redundant one year and take on additional staff the following year. Obviously, that does not help with continuity or planning. Such volatility could be alleviated if the funding formula were based on the numbers of full-time equivalent students—a methodology already used by the higher education funding councils. If the core funding for each college were supplemented by development funding, that would also help with planning.
Moreover, the Government should stop the capping of higher education in those colleges, and should end the unfair anomaly that higher education courses in FE colleges attract less funding than further education courses. The funding of higher education courses should be the same in the FE colleges as in the universities, and the Government should look at the possibility of making the Scottish Higher Education Funding Council responsible for the funding of all higher education in Scotland, both in universities and in colleges of further education.
Finally, the Government should give further consideration to strengthening the links between colleges and local education authorities by decentralising the funding process. I realise the Government's unwillingness to turn back the clock, but perhaps some contractual arrangement between the colleges and the local education authorities for the funding of further education courses would enable the different characters of the colleges to be recognised and would enable the colleges to retain the benefits of incorporation while giving them an element of local control and accountability.
In any event, the Government must give urgent consideration to the serious problem of underfunding of the colleges. The further education colleges have made an important contribution to increasing the participation of people in education, particularly young people. By 1998, the total number of 17 and 18-year-olds will have increased by 12 per cent. since 1995. The Government have set a key target for 2000—that 70 per cent. of young people will have at least an SVQ III qualification. However, last year only 51 per cent. of young people had that qualification—19 per cent. short of the target—and last year's figure was lower than that for 1993. The colleges have an important role in meeting the key targets for 2000.
The hon. Gentleman referred to young people in our colleges. Does he accept that further education colleges also have a significant role for women whose families have grown up and who wish to return to college to undertake courses? One of the difficulties that these women face is that some of the colleges charge for creche and nursery facilities. This aspect should be looked at in depth. Women should be encouraged back into employment.
I agree with the hon. Lady. Many of the courses that appeal to women may be discontinued if the Government do not provide adequate funding, which will severely limit education opportunities for many women throughout Scotland.
The colleges have traditionally played an important part in Scottish life, enabling many people to continue their education—whether it be for their individual development and enlightenment or for the acquisition of the types of vocational qualifications that are so essential for industry, commerce and the economy. If the colleges are to continue their excellent work, they must be given sufficient resources.
The Government must face up to their responsibilities. They introduced incorporation, so they can no longer pass the buck to local education authorities. The Government must provide the resources now. More expenditure on the colleges should be a top priority: it is an investment in education, an investment in training, an investment in people, and therefore an investment in Scotland's future.
Good morning, Madam Speaker. I congratulate my learned Friend the Member for Falkirk, West (Mr. Canavan) on securing this important debate and on covering it so eloquently. He has left little for other hon. Members to say, other than to mention important issues that concern the colleges that he did not mention, such as Kilmarnock college.
No, I do not think that there is. In four and a half years, I do not think that anyone has ever said good morning or good afternoon to me—which is why I appreciated it this morning, after a rather late night.
Madam Speaker, the point that you raise is valid: late nights and early mornings sometimes mean that we lose our sparkle.
Kilmarnock college is in my thoughts at the present time because of the Government's proposal to decrease the overall amount of funding for further education over the next two years. The proposal flies in the face of the success of all the colleges that have been mentioned, such as Kilmarnock college which is in my constituency. Evidence from Government reports has identified the need for a well trained and well educated work force, particularly at technician level in industries such as electronics, textiles, food and drink, and engineering.
All those industries are well represented in Ayrshire, particularly in Kilmarnock. In fact, the area used to be even better represented by these industries, before the loss of Massey Ferguson and almost 1,800 jobs at the stroke of a pen. That was some time ago. No multinational company of that size ever came back to Kilmarnock or to many other areas of Scotland. However, the small firms have done extremely well and we hope that their success continues.
Kilmarnock college has an effective working relationship with Enterprise Ayrshire and local authorities to deliver innovative training schemes. Kilmarnock college is working with small and medium-sized engineering companies, offering work-based training in a flexible, multi-skilling project. One has to ask why—at a time when ambitious national training targets have been set—are the Government squeezing the very organisations that are making the greatest contribution to achieving their targets?
Why are the Government reducing funding to further education colleges when, at the same time, they are producing competitiveness documents that indicate the need for Scotland to have a well trained work force to compete in European and international markets? Electronics, textiles and engineering are the industries in which we need to have a highly skilled and well qualified work force. These industries are already in Ayrshire, but why have the Government reduced the amount of money available to further education when an increase is needed?
At the same time, I see no logic in allowing colleges to expand their full-time provision at higher national certificate and higher national diploma levels in areas where there is a proven need for engineering, science and technology. The Scottish Office further education funding unit should be working much closer with colleges to allow growth in areas that are vital to our local economies, particularly in engineering and electronics. They are holding at current levels the courses in soft areas, such as arts and social science. I am not a critic of holding the places in those so-called soft areas.
I am concerned that further education colleges do not have the necessary modern buildings and equipment to provide the appropriate courses to meet local needs. Some of the buildings are modern, but they have proved to be totally inadequate for the Scottish climate, particularly those that have flat roofs. Kilmarnock college has to spend some £500,000 on roof repairs at its Kilmarnock campus and some £250,000 on roof repairs at its Irvine campus.
I would have expected the college to receive a generous capital allocation from the further education funding unit so that it could tackle the problems. There is no point taking people into a building if the roof is likely to fall in at any time. Roofing repairs cannot be put off until next year so far as capital expenditure is concerned—they have to be done now. What did the further education funding unit give Kilmarnock college to tackle this pressing problem? Nothing.
It is also important that colleges are able to purchase modern equipment that allows relevant and appropriate training to take place. In engineering, computer-aided design and manufacturing equipment, electronics equipment and science equipment are essential if we are to keep up the struggle with the competition in Europe and beyond. Electronic equipment and science equipment are vital, and my learned Friend the Member for Falkirk, West covered those points very well. However, they are worth underlining and I want to hear what excuse the Minister will give for not providing the funding necessary to purchase that equipment.
Unlike the higher education sector—universities have diverse sources of funding—further education colleges struggle to provide such equipment. As I have said, the Scottish Office allocation to Kilmarnock college this year is zero. How long can that be allowed to continue? It must not continue and I hope that the Minister will announce today if not a solution to the whole problem, at least some capital funding that will enable Kilmarnock college to begin to repair its roofing.
Like us, the Government must recognise the importance of further education to the economic and social well-being of our local economies and our communities such as Kilmarnock and Loudoun and other areas of Ayrshire and supply adequate funding so that colleges, including Kilmarnock college, can provide adequate further education within the terms of the Further and Higher Education (Scotland) Act 1992. The Act states that the Secretary of State has a duty to make adequate further education available throughout Scotland and I think that he and the Minister are in danger of defaulting on their duty in that regard. The Secretary of State is also in danger of failing in his duty to the people of Kilmarnock, of Ayrshire and of Scotland as a whole. I look forward to hearing the Minister confirm today that not only is he seriously concerned about the issues that hon. Members will outline but that he has immediate plans to reverse the trend.
I congratulate the hon. Member for Falkirk, West (Mr. Canavan) on his choice of subject for debate. While there has been considerable concentration on nursery, primary and secondary education due to the Government's interference and bungling in those areas and upon university education due to massive under-resourcing, the further education sector has been left out of the limelight. This debate gives credit where it is due. I know from my time as a senior lecturer at Angus college and at Dundee college the massive value of further education and the range of subjects that are taught at FE level.
Further education colleges have always been at the innovative and the pioneering edge of the education system. The hallmarks and the strengths of the FE sector are flexible courses, staff who are willing to adapt and reflect changing needs and the ability to cope with a wide range of demands for different courses—from the practical to the out-and-out academic. I enjoyed teaching in further education and I witnessed at first hand a period of growth at Angus and Dundee colleges which showed the FE system in its best light.
More than 200,000 students participate in either full-time or part-time further education—an increase of more than 50 per cent. since 1993. There is certainly a demand for further education. It has always been particularly important in the Scottish context as a provider of education and employment. According to the McNicholl report, further education colleges generated an estimated £600 million and 19,000 full-time equivalent jobs for the Scottish economy in 1993–94. They sustain many Scottish communities as both employers and education providers. I believe that we should invest in the sector—greater investment will be repaid handsomely in the future.
Under Government policy, which has consistently attacked local authorities, the right to award bursaries has been removed and the colleges are now funded directly by the Secretary of State for Scotland. The move to a new funding methodology was established through the use of a formula which directly links the level of funding to the volume and quality of learning. The key criteria in formula funding are student recruitment and retention. It represents an abrupt change from historic funding and has caused major difficulties for individual colleges.
While grant allocations are based entirely on the number of students at respective colleges, the Government have sought to encourage the growth of private finance initiatives. I believe that the loss of control associated with the development of PFIs undermines accountability. The Government have cut capital grants assuming that PFIs will step in, but the lack of proper investment has hit developments in science, engineering and technology. I am told that there are no funds to prepare for and implement "Higher Still" in 1998. I hope that the Minister will address those problems directly.
Some £11 million was axed from the Government's previous funding plans for further education colleges in 1995, despite a projected increase of 12 per cent. in the number of young people aged 17 and 18 in the period 1995–98. Thus the success of further education colleges is leading to their being penalised. The cuts also ignored the fact that the Government are already under-performing in terms of their training targets.
The effect of the cuts has been twofold. First, the need to make savings has caused huge staffing problems. The hon. Gentleman underlined that point admirably when he pointed out that Falkirk college of technology was forced to save £670,000, which is equivalent to 35 jobs. Lecturers at Coatbridge college have not had a salary increase since April 1994, which led to a strike by Educational Institute of Scotland members.
Secondly, there has been an attack on the national character of further education colleges, as increased funding for one college reduces funding for another. Simple numbers of students is a crude means of evaluation, which ignores special needs and the importance of the continued existence of a diverse choice of colleges at a time when increasing numbers should be a prime objective. FE colleges contribute greatly to the Scottish economy and we should build on that strength.
The Association of Scottish Colleges has offered some possible solutions to the problem and I recommend its suggestions to the Minister. They include an increase in the overall recurrent grant, a relaxation of capping, stronger policy support for vocational training, support to implement "Higher Still" in 1998 and more capital funds to bring buildings and equipment up to modern standards. Instead of greater investment, the Government propose further cuts in resources.
I note with despair that grant aid to colleges will be reduced by £15 million in the next three years—a cumulative reduction of 12.5 per cent. Those cuts are not sustainable without hefty redundancies of staff and a loss of quality and/or range of teaching—which is the strength of the FE sector. The PFI certainly cannot renew or replace dilapidated buildings or obsolete equipment. There is a danger that funds for bursaries in vocational further education will be frozen and that there will be a shortfall in key training targets.
The Government are failing the further education sector which would amply repay the extra investment that it needs. I have worked in further education and I know its strengths and the immense benefits that it offers across society. I echo the point made by my hon. Friend the Member for Moray (Mrs. Ewing): some of the best students I taught were women with families who returned to education. Many of them went on to university and they now have degrees. They are a credit to the further education sector, and their progress should be developed rather than hindered by a lack of investment.
Young people relish the further education atmosphere. Mature students who are given a second chance at education are faced with a dazzling range of courses that meet the needs of individuals and industry. I believe that further education is an asset that the Government are failing to resource properly. In so doing, they are making a major mistake.
I say amen to the considered, well argued and well informed speech by my hon. Friend the Member for Falkirk, West (Mr. Canavan), who knows and cares a great deal about the issue. My hon. Friend the Member for Kilmarnock and Loudoun (Mr. McKelvey) and the hon. Member for Angus, East (Mr. Welsh) also made important speeches and raised many issues which deserve answers. I hope that the House will forgive me if I stick to a wholly local issue: the proposed relocation of West Lothian college to Livingston.
I am not casting aspersions on the motives of those who have made the proposal. I do not doubt their good faith and I understand perfectly well the attractions of a college under one roof on a single site rather than the difficulties that inevitably arise with an institution based on two separate sites, although it may not be such a serious problem to have two sites for a further education college which, by its very nature, would be concerned with full-time learning rather than part-time courses. But any such move would tear the heart out of the proud town of Bathgate.
Those of us in the area of Bathgate have accepted that the police headquarters, the council headquarters and a number of other important institutions should move to the new town, but at some point we must ask questions about the centres of old boroughs. The Minister should take it from me, as the local Member of Parliament and a local person, that the removal of that college from Bathgate would be a serious matter for the town and for that part of West Lothian. I therefore have five questions to ask.
First, what are the responsibilities of the board of management of the college to the Scottish Office? Perhaps I should know, but I am not the only one who is not clear about that. Secondly, the proposal has leaked out, but has the Scottish Office been consulted—it may not have been—and, if so, what did it say? Thirdly, what has the Scottish Office advised about staff and resource requirements? As my hon. Friend the Member for Falkirk, West has said, there is a desperate shortage of resources and so many other urgent priorities. Has the Scottish Office been consulted about the proposal as a priority for the use of scarce resources and, again, what has it advised?
Fourthly, what consideration has been given to the proposal by planners in the Scottish Office? West Lothian council has not been consulted about the rebuilding—if there is to be rebuilding—or new building on the St. Mary academy site and on the land above the college which, as far as we know, is free land on which major building work could take place. Has consultation taken place about that proposal?
Fifthly, as I understand the current proposals—I am open to correction—the builders are to erect a new building on the Livingston site. In return, West Lothian college proposes to give—I repeat, give—the current buildings and land to the builders, though not the old academy, which I believe is listed, because it belongs to the people of Bathgate. We are uncertain about who the people of Bathgate are in that respect, other than the successors to the old West Lothian county council. That is a grey area. As I understand it, West Lothian college will then lease—I repeat, lease—the new building and equipment from the builders. If I have understood it right, and if other people have understood it right, that arrangement raises a few eyebrows. What does the Scottish Office think about the leasing proposal?
The issue is the future of the town of Bathgate. I ask those questions, in gentle tones, because I genuinely do not know the answers. I do not want to jump to any conclusions until there has been a proper discussion.
I wish to add my congratulations to my hon. Friend the Member for Falkirk, West (Mr. Canavan) on obtaining this debate on the subject of further education. The subject has been much neglected in debate in the House and it is high time that further education, especially Scottish further education, got a thorough airing. My hon. Friend the Member for Kilmarnock and Loudoun (Mr. McKelvey) spoke about equipment and facilities for people undertaking skills training and I fully support all that he said.
I wish to raise an aspect of further education that has always been neglected—the wider general education of students in further education. Everyone who has ever worked in further education knows, as the hon. Member for Angus, East (Mr. Welsh) will confirm, that there is not only a long-standing lack of appropriate funding, but sometimes a problem, unfortunately, with the attitudes of the traditional craft teachers, who regarded any time spent on general education as a waste of students' time. It has always been a struggle to provide appropriate general education for students who come straight from school and spend some years on day release or block release.
When my hon. Friend the Member for Falkirk, West mentioned the fact that teacher numbers in FE were dropping, he filled me with alarm. I taught in FE for some years and I remember what happens when there are not enough teachers to serve the students' needs. Teachers get landed with timetables that have far too many class contact hours and they cannot get through timetables of that size without using devices to overcome the problems, such as doubling up classes; that is not good for the students, but it is one of the strategies that teachers are forced to adopt when they have marking or preparation to do for other classes.
Teachers are also asked to teach subjects that they are not qualified to teach. I recall my first week in FE. I had spent several years acquiring an honours degree in economic history, with English as my second subject, but I was given a timetable that included four periods of chemistry. I went to the head of department and said that there must have been a mistake. He said that the students were only studying chemistry at a low level and that I need be only one chapter ahead of them. I refused point blank to teach chemistry because I had not spent all those years acquiring my qualifications to end up teaching a subject that I could have taught equally badly when I left school. I failed science in my third year at school and never attempted it again.
It is nonsense that teachers can be asked to teach subjects that they are not qualified in, but it happens. I was able to resist the request because I was in a full-time, permanent post and I had a union that could back me up if necessary. But now, when so many people have short-term, impermanent posts and contracts, they find it difficult to resist such nonsensical suggestions. Such problems will lead to a failure to educate young people in further education so well as they could be educated.
Another problem is the discontinuation of courses because there are not enough staff to teach them. Another danger, which has not yet been mentioned, is the requirement that a course must have a certain number of bodies in the classroom to be taught. If a small number of students genuinely want to do a course and are appropriately qualified for it and keen to get started, they might be disappointed unless the number of bums on seats can be increased.
What happens is that people for whom that course is not really appropriate are persuaded by unscrupulous persons to enter that course, which might not be right for them because it is either beyond or beneath their capacities. It might not be a suitable subject area for them. In some instances students will be directed to the course merely to get it started. If they later fall by the wayside, too bad. Some will say, "At least the course was started." We must avoid such nonsense taking place in further education. We know, of course, that they arise because of shortage of funds.
I should like to know—the Minister will probably not be able to tell me when he replies, but the information could be set out in a written answer—what is spent per head on further education and higher education students. We know that HE necessarily costs a great deal of money. We have seen the results of underfunding in FE, however, which can be grotesque. I spent several years in a business studies college, which was virtually asked by the local authority not to use so much paper. That was a nonsensical request of a business studies college. We were not making paper aeroplanes. Paper was being used for work.
Anyone who has taught general education in an FE college will recognise the Wilt syndrome. Tom Sharpe wrote about the experience of a general studies teacher staggering from block A to block D with 20 copies of "Shane" in his arms. Tom Sharpe was not exaggerating and he was not joking. Students do not have the funds to enable them to buy their own books. I remember ancient and battered copies of texts that we had to cart from room to room, or even block to block, so that we might give work to students. We had constantly to spend time devising our own materials or finding them because there were insufficient funds. That time could have been spent on teaching. Those are examples of what happens when there is underfunding in further education.
The market has been brought into further education and, as a result, colleges are competing with one another for courses instead of adopting a more sensible planning approach to ensure that colleges play to their own strengths and teach the subjects which are traditional to them and which they are accustomed to teach. A planning approach would ensure that students' needs were better met than at present. Students now are even more disadvantaged than they were 20 years ago when I was involved in FE.
I look forward to the day when we have a Scottish Parliament. At long last we shall have a dedicated and elected body that will take the interest in FE that is now sadly lacking.
I shall speak only briefly because the debate takes place on the firm foundation provided by the hon. Member for Falkirk, West (Mr. Canavan), who covered almost all the ground. It was tempting to say, "Let the Minister reply to that." The hon. Gentleman made all the key points.
I take up the final remark of the hon. Member for Glasgow, Maryhill (Mrs. Fyfe). I, too, look forward to the day when there is a Scottish Parliament. If it works as those who are involved in the constitutional convention foresee, it will use committees and have a greater involvement in consultation. As a result, the further education and higher education institutions will have a close link with the Scottish Parliament. When it makes decisions that affect FE and HE, and other education sectors, they will be informed ones. I have no doubt that it will legislate accordingly. There will be good and close links between the Scottish Parliament and those involved in the various education sectors.
When the Government took legislation through the House to take FE colleges away from local authority control, the proposal was met with considerable resistance, and naturally so. There is considerable concern when Government have the opportunity to centralise. They follow up that process with direct controls over funding, which is really the substance of the debate.
In a local context, I appreciated the fact that the Scottish Office gave proper recognition to the fact that the FE colleges in both Orkney and Shetland were closely integrated with the secondary schools on both islands. Since structural changes have taken place, it has been pleasing to watch the development of FE facilities on both Orkney and Shetland. I had the great pleasure last year of opening some splendid new facilities for the FE college on Shetland. I know that on Orkney considerable efforts are being made to establish the FE college in its own right. I believe that we shall see it moving away from its integration with the secondary school.
What we have achieved locally on the islands echoes one of the calls made by the hon. Member for Falkirk, West. There should be a way of establishing better links with the local education authority and FE colleges. It is important to establish a link between the community and its FE college. That is something that we have achieved on Orkney and Shetland because of our slightly different status.
It is important to develop—I am sure that this is not exclusive to FE colleges in the highlands and islands—distance learning techniques. A considerable amount of education is now delivered by that means, and I am sure that the technique will be developed still further in years to come. Many FE colleges will play an important part in the development of the university of the highlands and islands. It is thought that the university should not be concentrated in one place and instead should be a multi-campus institution. I am sure that FE colleges have a considerable and important role to play in that context.
We have heard that, since the incorporation of FE colleges, there have been considerable achievements in terms of increasing numbers of students and efficiency gains, which last year were assessed as 4.2 per cent. As has been said this morning, however, we cannot go on and on increasing numbers and expecting efficiency gains to be achieved. Increasing numbers pose their own problems in terms of providing accommodation and ensuring that proper staff time is made available to students.
The cry that is coming from the debate is that it must be recognised that we cannot continue to reduce funding year upon year. There is a predicted reduction in funding of about 4 per cent. in real terms, year on year, from now until 1998–99. That will lead to a reduction in the quality of the education provided, and it is bound to have an effect on staff morale, especially if there are redundancies to meet lower budgets. Reduced funding will also have an effect on students.
Those engaged in FE, and the nation as a whole, face a considerable challenge. It is clear that FE is an important resource and an important opportunity for the 60 per cent. of young people who do not wish to enter HE. It is an important sector in which the skills of our young people can be developed. When we consider the targets that have been set by the Government and the Advisory Scottish Council for Education and Training, we realise how far we are still falling behind. One of the most alarming targets is that 60 per cent. of the work force should have SVQ III qualifications by the year 2000. We had reached 47 per cent. by 1995, and the position was static. Given the trends that have been discussed this morning, it is difficult to see how the gap can be bridged satisfactorily in the four years left to do it.
Everyone—the Government and the Opposition, the Confederation of British Industry and the Scottish Trades Union Council—agree that it is important to improve the skills and training of our young people. As the hon. Member for Moray (Mrs. Ewing) rightly reminded us, it is not only young people and women returners who are to be considered. We must increasingly recognise that in a rapidly changing world the skills that young people acquire at the age of 18 or 19 may not be the skills that they need for employment or employability when they reach the age of 35 or 40. We shall increasingly see people returning to colleges to update their skills, and the FE colleges in Scotland will have a significant role to play.
We must maintain a network of FE colleges which achieve high standards. That can be done only if it is accepted that there must be the funding and resources that go with producing the quality education that our country and especially our young people so desperately need.
I join my hon. Friends in congratulating my hon. Friend the Member for Falkirk, West (Mr. Canavan) on securing this important debate, as further education has become very much the orphan of the education system, which is regrettable, as it is a tremendous window of opportunity for people and, indeed, the economy.
I hope that such an experienced parliamentarian as my hon. Friend will not consider it amiss if I—as an inexperienced parliamentarian—echo the points made by my hon. Friend the Member for Linlithgow (Mr. Dalyell) and pay tribute to the considered nature of my hon. Friend's speech, much of which was obviously the result of considerable thought and experience. I listened to it with interest and will read it tomorrow with even greater interest, as he gave us some pointers to the future that merit detailed consideration by my hon. Friends and me, and also by the Government. Many of my hon. Friend's points about the future of higher education funding and the relationship with further education funding are important. The key point he made is at the root of the debate—the paucity of funding for further education in Scotland, which is of considerable importance to Scotland.
Since taking over the education brief, I have had lengthy discussions with representatives from further education colleges. Indeed, I have a constituency interest, as a further education college is adjacent to my constituency. In the House today are representatives of the further education colleges, who have travelled all the way from Scotland at considerable inconvenience and expense, so it is with regret that I see that on the Government Benches the Minister sits isolated with only the Whip for interest. Do none of his hon. Friends represent areas with an interest in further education? Further education is at the heart of the education system in Scotland, and it is regrettable that Conservative Members have not taken more interest in the debate, given that all the Opposition parties in Scotland have been represented and a number of significant points have been made.
The extent of the funding cut affecting colleges—half the colleges have suffered quite a severe cut—is causing grave concern to all of us who are concerned about the future of further education in Scotland. The point has been made repeatedly that there has been a continuing quest for efficiency on the part of the Government, not recognising that year-on-year quests for efficiency, with student numbers increasing, as the hon. Member for Orkney and Shetland (Mr. Wallace) pointed out, are not the route to efficiency but are the route to reducing quality. That point was made by my hon. Friend the Member for Glasgow, Maryhill (Mrs. Fyfe). I shudder to think what I would have done if I had been asked to teach chemistry. I referred in Committee yesterday to the lengths to which I went to get a higher in Latin, which involved learning Latin off by heart to get through the exam. I should add that I was successful and now have a higher in Latin, but do not ask me to translate any of it.
This is the European Year of Lifelong Learning, and the hon. Member for Aberdeen, South (Mr. Robertson), in his capacity as Scotland's Education Minister, took part in its impressive launch at the new conference centre in Edinburgh just few months ago, in the presence of Mrs. Edith Cresson. Is it not ironic therefore that this year we are cutting the resources to one of the key elements of lifelong learning—further education?
My hon. Friends and the Minister will recognise that I have a specific interest in this in relation to the career of my personal assistant, Mr. Frank Roy, who was a Ravenscraig shop steward and was made redundant as a consequence of the closure of that plant. The closure had a devastating effect on the economy not just of Lanarkshire but of all Scotland. With the help of Motherwell college, he got his highers, and with his own determination he got a degree from Glasgow Caledonian university. He now works for me, which is a bit of a dip in his prospects, but in the next few months my hon. Friends and I look forward to welcoming him to the Labour Benches as the Member of Parliament for Motherwell and Wishart. [Interruption.]
I have a limited sense of direction, but I am sure that my hon. Friend, as he will be at that time, will be a great help to a Labour Government, given his wide range of skills and his common sense. Common sense is lacking in the Government's attitude to further education in Scotland. It is common sense to build up the skills base of our economy. As my hon. Friend the Member for Kilmarnock and Loudoun (Mr. McKelvey) pointed out, what is the point of competitiveness White Papers when we are slipping to 35th place in the world list of educational qualifications? We are cutting the very means by which people can acquire skills throughout their career.
Those of us who are in our prime left school, but the opportunity was there to pursue further or higher education and to look forward to a reasonable spread of careers, until the Conservative Government took over in 1979. Now our children will probably have to change careers three or four times in their working lives, not just as a consequence of the policies of the Conservative party Government but because of industrial and technological change. One key way to ensure change in the skills base is through an adequate system of further education. My party pledges itself to a strong and vibrant further education sector.
I have taken on board a number of the points made by my hon. Friend the Member for Falkirk, West, which are extremely interesting. I have also taken into account one of the significant points made by the hon. Member for Orkney and Shetland regarding asset targets. We recognise that, if we are to have a viable economy in future, we must increase the skills base. I pay tribute to the work carried out by the advisory committee on education and training in Scotland, which has done a tremendous amount of work in identifying the weaknesses in the skills base.
I was particularly impressed with some of the points made by the Association of Scottish Colleges, which I had hoped to meet on Monday. Because of parliamentary business at the Scottish Grand Committee in Perth, however, I was not able to do so. That association and the Educational Institute of Scotland pointed to the shortfall in meeting the asset targets in Scotland. To an extent, that is because Ministers refuse to accept ownership for the targets and refuse to accept responsibility for the funding of further education to ensure that we meet them.
In another part of the House, we have discussed in the past few weeks the establishment of a single examination board that will take into account the Scottish Examination Board and the Scottish Vocational Education Council to ensure that the examination structure in place for the introduction of "Higher Still", which is a radical change in post-16 education in Scotland. One important element to secure changes in post-16 education in Scotland is to ensure that our further education colleges are equipped to prepare themselves for "Higher Still", and they are limited as a consequence of the decisions that the Government have taken on funding.
How many colleges began this year with a deficit? Further education colleges have been under pressure not just because of the impact of incorporation but because of the policies that the Government have adopted. One of the positive consequences of incorporation is the involvement of local businesses in further education. Many business men and women are appalled at the way in which the Government have conducted further education funding: they continually move the goalposts. They insist on efficiency savings whenever they are not prepared to make resources available, and they fail to recognise the crying need of local industry for a well-skilled work force.
I listened with great interest to the points made by my hon. Friend the Member for Linlithgow, who pointed out the difficulties that Bathgate is likely to experience as a consequence of the decision to centre his further education college in Livingston. I do not wish to go into specific constituency points, but my constituency is adjacent to Bathgate and I recognise the extent to which a college can give some vibrancy, life and hope to a community. My constituency is adjacent to Coatbridge college and I recognise the significance that it brings to the local community. I know from my local employers how important it is to have the college nearby, one with which they can co-operate and get a ready supply of skilled workers.
The hon. Member for Angus, East (Mr. Welsh), who has worked in further education, made an important point about the availability of resources. He also spoke of the need for a diverse range of courses. We in Scotland pride ourselves on the diversity of our education system, which must be extended and maintained in further education. The point was amplified by my hon. Friend the Member for Maryhill, who referred to her own experience and made an interesting point about the quest for improved general education standards in Scotland. That relates to the availability of general education in further education colleges for those pursuing craft courses.
If we are to have multi-skilling, and if new skills are to be available for the future, people must have the self-confidence that will enable them to change skills. That may not seem important, given the self-confidence of my hon. Friends, but increasing people's confidence is difficult in Scotland, partly because we have experienced generations of high unemployment. Our education system is very sound on the basics, which gives us the edge, but we lose out through not giving people enough self-confidence. That is one of the great things that educational qualifications can provide, because achievement in the further education sector is recognised.
It is regrettable that we have had to have this debate. It would have been much better if we had gathered here to examine the opportunities for further education in Scotland. As we approach the turn of the century, new industries and opportunities will emerge. I hope that that will happen under a Labour Government.
Those of us who represent Lanarkshire constituencies are very conscious of the impact of inward investment and companies such as Chunghwa Picture Tubes, and of the need to provide the diversity of skills that that company will require. The same position is replicated throughout Scotland. Another important part of Scotland's economic future is tourism. Many of our colleges provide courses in hospitality, which are vital to the improvement of the service that we offer the tourist industry. They, as well as the many science and technology-based courses of which we have been so proud in the past, are important in Scotland.
I cannot understand the reasoning of the Scottish Office. I hope that the Minister will be good enough to give us a clue to why he is selling not just the family silver but the future in refusing to fund our colleges adequately. It is not necessary to travel far to find colleges that are doing sterling work in deplorable conditions. There will be no sustainable future for those colleges if there are to be hefty staff redundancies, and a lessening of the quality and range of teaching because of the pressures put on teachers who must work in dilapidated buildings with obsolete equipment that the private finance initiative cannot renew or replace.
The only form of growth that has taken place is the granting of responsibility to colleges for the allocation of bursaries. We shall be discussing that elsewhere in the House of Commons in the next few days, but is it not ironic that the Government, while trimming and fiddling at the edges, are ducking the key issue? If we are to invest in the future of the Scottish economy and the confidence of our young people, and secure the place in the world economy which I believe we are capable of securing rather than languishing where the Government have put us, the investment that we make in education is crucial.
I commend the speech of my hon. Friend the Member for Falkirk, West. He made valid points that summed up the issues that people in Scotland are currently discussing. As my hon. Friend the Member for Kilmarnock and Loudoun pointed out, in investing in further education we are investing in training, education, our people and our country's future.
This morning's debate shows the nature of the issues that a Scottish parliament will address. It will be in tune with the demands of the people of Scotland, and will provide a degree of co-ordination and commitment that I consider important. I hope that the damage that the Government are doing to further education will not have dug in so deep that it will be too difficult for us to address in the early days of a Labour Government.
I join other hon. Members in congratulating the hon. Member for Falkirk, West (Mr. Canavan) on securing the debate. It has been a good debate, and, although I may not have agreed with everything—indeed, anything—said by Opposition Members, I do not doubt their sincerity for a moment. That applies both to the specific constituency cases cited by the hon. Members for Kilmarnock and Loudoun (Mr. McKelvey) and for Livingston (Mr. Cook) and to the more general points that were made.
I did not agree with everything, and perhaps with anything, but the hon. Gentleman may agree with some of what I say. As I have said, I do not doubt Opposition Members' sincerity, although part of what was said by the hon. Member for Monklands, East (Mrs. Liddell) seemed unnecessarily strident.
The debate is important because of the vital role that our colleges play in meeting the skills needs of the Scottish economy. I hope that the hon. Member for Falkirk, West read the article in yesterday's edition of The Herald, which said that substantial growth in the uptake of Scottish vocational qualifications was being stimulated throughout Scotland by the further education sector. That flies in the face of one of the central points of the hon. Gentleman's speech.
No one disputes the fact that we need a highly competitive and skilled work force in an increasingly competitive global economy. The role of colleges, and their success—for I believe they are successful—is not mentioned often or loudly enough. Today's wide-ranging debate has highlighted some of those successes, but, unfortunately, it has also misrepresented the dynamism of Scotland's FE sector to a great extent. I welcome the opportunity to make clear the Government's support for the colleges, and to describe what we have done and will do in the future.
I am personally committed to that, having visited nine colleges in virtually as many months. I did that because I wanted to see at first hand what they were doing and how they were doing it. I was impressed by the enthusiasm and commitment of the management, staff and students whom I met, and I pay tribute to them.
In the period since April 1993—which, after all, was only just over three years ago—colleges have built on earlier strengths and, through that liberating process, have achieved some remarkable advances. Incorporation has assisted college responsiveness by devolving decision making to local level, and has led colleges to look critically at their structures and systems to ensure that they are appropriate to a dynamic environment.
The hon. Member for Kilmarnock and Loudoun asked why a college in his constituency had received a nil capital allocation for this year. Capital works in our colleges are increasingly being funded successfully from the private finance initiative. What the hon. Gentleman did not mention was that Kilmarnock college had received 5.12 per cent. additional funding this year, and last year had received a capital grant of more than £500,000. I was concerned by much of what the hon. Gentleman said, however, and I shall be happy for my officials to meet representatives of the college as a matter of urgency to see whether the issues that he raised can be explored further.
The hon. Member for Linlithgow (Mr. Dalyell) mentioned the relocation of West Lothian college from Bathgate to Livingston. The college has not yet assessed the financial and other implications of the option to relocate the entire college. In reaching its conclusions, it will have regard to the best interests of education and training in the West Lothian area as a whole, and we shall study those conclusions carefully.
The hon. Gentleman asked five specific questions. If he does not mind, I shall reply to them fully in writing.
I do not hesitate to give the hon. Gentleman that assurance.
As the hon. Member for Monklands, East said, colleges are also involving employers, as major stakeholders, in what they do. That involvement takes place at many levels: on the board of management to ensure strategic vision, with the local enterprise company to collaborate in the local achievement of education and training targets and with individual employers to meet their specific needs. What characterises 0the 220,000 students who attend colleges is the differences between them, and that is the strength of those colleges. About a third of college activities are undertaken by part-time students, with 5 per cent. of students studying by open or flexible learning. In recent years, much of the growth in Scottish higher education has occurred in colleges.
The hon. Member for Glasgow, Maryhill (Mrs. Fyfe) spoke of staff numbers being in decline. That is not true. In October 1992, there were 6,850 teaching staff, but since incorporation the number has risen, to just under 7,000 in 1994–95. The increases in the volume of student activity in 1994–95 over the previous year were as follows: art and design, up 14 per cent.; social studies, languages and communication, up 9 per cent.; and special needs programmes, up 17 per cent.
I shall write to the hon. Lady. If she wants me to write to her again, perhaps she will write to me and we may make some progress.
We funded growth, but, following rapid expansion, it has proved necessary to hold full-time numbers to their current record levels, although colleges are being encouraged to continue to expand the number of students on part-time higher education courses.
Such provision is not capped. Just under half of all students are over 25, reflecting the range of innovative programmes on offer and the colleges' commitment to lifelong learning. Increasingly, colleges provide training for employers on their premises, often to Scottish vocational qualification standards. I want to encourage these trends, with colleges increasing student participation further, particularly by introducing more part-time provision and open and flexible learning opportunities in partnership with employers.
The goal of increasing student participation has been one of our major objectives since incorporation, and we are meeting the objective. In the academic year 1994–95, student activity increased by 6 per cent. Colleges will continue to increase activity this academic year and in future. That growth is being stimulated by the funding of colleges and by the way in which funds are distributed.
Listening to some hon. Members, one would think that colleges do not have the resources to fund that expansion. Since incorporation in April 1993, recurrent funding for further education has increased by 14 per cent. In each year, the recurrent funding made available to colleges has increased. In 1996–97, £233 million will be available. That has been possible despite the need to maintain downward pressure on public expenditure.
The hon. Member for Monklands, East, in a wide-ranging and well-crafted speech, said that the Government were underfunding further education. I assume that she missed out the page in her speech that stated by how much we are doing so and how quickly and how much an incoming Labour Government would put into Scottish higher education. I give her the chance to rectify her mistake, which she made when she turned over two pages in her speech instead of one.
I was aware that a number of colleagues had made the point and I did not wish to be unnecessarily repetitive. However, £45 million less is available to colleges than employers say they need simply to maintain 1995 service levels.
I recognise that the Minister is practising for being in opposition, questioning the next Government. We will adequately fund Scottish further education. My hon. Friend the Member for Dunfermline, East (Mr. Brown) has published wide-ranging proposals that will ensure that our young people get the skills and training that the Government's funding of further education is limiting.
I hope that all those from the colleges who are watching the debate and those who will read it later heard the hon. Lady refuse to give any commitment on how much an incoming Labour Government—that will not happen—will spend.
The challenge for now and for the future is to maintain and improve standards while increasing efficiency. We have set the colleges challenging targets, delivering efficiency savings of 4 per cent. each year. I am pleased to say that the colleges are achieving that, and there is no reason why they cannot continue to do so.
At the time of incorporation, the costs of providing further education varied enormously throughout Scotland. In some colleges, it cost about twice as much to teach comparable subjects. Colleges were not funded coherently or systematically. We have therefore gradually phased in a newer and fairer approach to allocating funds, based on student activity achieved by colleges. This aims to ensure that a reasonable balance is struck between resources that colleges receive from the taxpayer and the need to encourage them to deliver value-for-money increases in student participation and high standards, which they are achieving.
I make no apologies for the new funding formula, requiring high-cost colleges to find efficiencies to bring them closer to the average. The wide variation in colleges' cost efficiencies could not continue. We are assisting colleges to make the necessary adjustments by restructuring funds—£4 million in 1995–96—for retraining or enabling staff to take early retirement. This is not all about shedding staff; restructuring must reflect the changing pattern of demand for courses. Many colleges are recruiting staff to meet the changing and growing demand in new areas, as the hon. Member for Falkirk, West said, such as mechatronics.
Our decisions on college funding reflect our view that, increasingly, the private finance initiative will replace capital grant funding. It is an important policy in bringing together a new partnership between the private and public sectors. Despite Opposition Members' comments, colleges are enthusiastic about it.
We do not doubt colleges' enthusiasm, but it would be greater if they received sufficient resources to do the job. The figures that I quoted were given to me by the Association of Scottish Colleges, which in turn were extracted from the Scottish Office's plans. Taking revenue and capital expenditure into account, in real terms, there will be a 12.5 per cent. reduction in the amount that the Scottish Office gives colleges from 1994–95 to the financial year 1998–99. How on earth can the Minister justify such a massive decrease in assistance to colleges?
Unfortunately, the hon. Gentleman has not been listening to me. I am glad that he accepts that colleges are enthusiastic about the private finance initiative.
Two projects—a new campus for Falkirk college in Stirling and a new campus for West Lothian college in Livingston—are at an advanced stage. The PFI is not the only public and private partnership that is under way. By operating more efficiently, colleges are freeing resources to improve their buildings and equipment, both directly and through the freedom to borrow. There are examples all over Scotland.
Among the best is the new multi-million-pound campus at James Watt college at the waterfront development in Greenock. Perth college has attracted £2 million of support from the Gannochy trust for a new library and study centre, which will put it at the forefront of the use of new technology.
I was pleased to inaugurate the construction of that building, where I announced a grant of £200,000 to assist with equipment. The policy document "Training for the Future" announced an allocation of £500,000 to equip colleges generally with new technological equipment. We have also invested substantially in upgrading college buildings since incorporation, with capital grants of £46 million. Hon. Members who visit colleges will see the transformation for themselves.
The list of achievements is long: the multi-million-pound project at Edinburgh's Telford college, whose refurbished north campus opened on Monday; Cardonald college, where investment of £4 million has been made; and Langside college's business school, which I recently opened.
If we are to face future challenges, a partnership approach is important. I should like briefly to identify what they will be. We must strive to provide better guidance, raise participation and improve success in achieving qualifications. We are working with colleges in these areas.
The "Higher Still" reforms, which will be implemented in academic session 1998–99, will provide a unified programme of academic and vocational learning, leading to certificates on a subject or group basis.
Information technology opens up an exciting new way of responding imaginatively to the needs of students and employers. Colleges need to facilitate that process, and we have the excellent example of Fife college, which demonstrated to me the use of telematics to support training in small and medium-sized enterprises. Information technology will also provide a way of delivering much of the teaching and learning at the new university of the Highlands and Islands. I am confident that further education colleges in Scotland will have more students studying more subjects with more staff and money than ever before. That is a tribute to the Government, and it is unfortunate that Opposition Members cannot see that.