Amendment 36

Skills and Post-16 Education Bill [HL] - Report (2nd Day) (Continued) – in the House of Lords at 2:31 pm on 21 October 2021.

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Lord Storey:

Moved by Lord Storey

36: Before Clause 14, insert the following new Clause—“Personal Education and Skills Account(1) A Personal Education and Skills Account (“PESA”) is an account—(a) held by an eligible adult (an “account holder”); and(b) which satisfies the requirements of this section.(2) An eligible adult is a person who—(a) is aged 18 or over; and(b) is ordinarily resident in England.(3) A PESA may be held only with a person (an “account provider”) who has been approved by the Secretary of State in accordance with regulations.(4) The Secretary of State may by regulations establish a body to administer the operation of the PESA scheme.(5) In the case of each person who is eligible under subsection (2), the body established under subsection (4) must open a PESA for that person.(6) If a person does not wish to hold a PESA, they must inform the body under subsection (4) in writing in accordance with regulations.(7) The Secretary of State must pay into each PESA a deposit of £4,000 during the year in which each account holder attains the age of 25 and a deposit of £3,000 during the year in which each account holder attains—(a) the age of 40; and(b) the age of 55.(8) Further contributions may be made to a PESA by—(a) an account holder;(b) employers; or (c) any other person as may be prescribed by regulations by the Secretary of State.(9) At any time after an account holder has attained the age of 25, they may transfer funding from their PESA to an approved institution for their chosen education or training course.(10) For the purposes of subsection (9) an “approved institution” is—(a) a “relevant provider” under section 18;(b) such other education or training providers as may be approved by the Office for Students.(11) Prior to an account holder making an initial funding transfer, the National Careers Service must offer a careers guidance consultation to that account holder.”Member’s explanatory statementThis amendment provides for individual “skills wallets” which may be used by a person to pay for education and training courses throughout their lifetime. The Government will make a payment of £4,000 when an individual turns 25 and then two further payments of £3,000 when an individual turns 40 and 55.

Photo of Lord Storey Lord Storey Liberal Democrat Lords Spokesperson (Education)

Amendment 36 provides for the introduction of personal education and skills accounts, commonly known as skills wallets. As stressed by many of your Lordships during the passage of the Bill, there is growing discontent about the way in which post-16 education and training are provided and the reality of the skills needed for our population.

We know that in future the average British worker will do several different jobs throughout their lifetime; almost half will retrain completely during the course of their career. Meanwhile, the number of adult learners has fallen dramatically, almost halving between 2004 and 2016. With technology advancing and the world of work always rapidly changing, skills learned at 18 or 21 will not last a lifetime. It has never been more important for people to continually develop new skills. Yet our higher education and student finance systems are still tailored mainly to people taking their first degree or beginning an apprenticeship around the age of 18. Meanwhile, there is a desperate shortage of funding in the FE sector. The current system limits the opportunities, and people do not get the chance to make the most of their talents. Do we not want to empower people to develop new skills, so that they can thrive in the technologies and industries that are key to Britain’s economic future? Championing flexible lifelong learning will give people the power to follow the path that best suits their ability. A skills wallet would be open to every adult over the age of 18 and resident in the UK.

I remind the House of the quite important words of the previous Secretary of State for Education when introducing the lifetime skills guarantee:

“What we are determined to do, and what we must do, is give people the opportunity to retrain and upskill, so that if one door closes, they will have the key to open others.”

He went on to say that the Government

“stand for empowering everyone in this country, wherever they live. We stand for the forgotten 50% who do not go to university.”

The measures that he wanted to see

“will embed greater flexibility in the technical and vocational system to support not just young people but adults who need to retrain and upskill at any point in their working lives.”—[Official Report, Commons, 1/10/20; col. 541.]

Those comments justify the need for this amendment. I beg to move.

Photo of Baroness Garden of Frognal Baroness Garden of Frognal Deputy Chairman of Committees, Deputy Speaker (Lords)

My Lords, I think there has been a regrouping; I was about to speak on an amendment that seems to have disappeared from here. I have added my name to Amendment 45A from the noble Lord, Lord Watson, which is still in this group, and of course I entirely endorse what my noble friend Lord Storey said about the importance of the skills wallet.

The amendment from the noble Lord, Lord Watson, is on lifelong learning. Of course, we would much rather see the support for this as grants, rather than loans, to attract adults with financial obligations that deter them from accruing more long-term debt—particularly if it is to encourage their own learning. The amendment is designed to monitor how well the lifelong learning arrangements are working. We particularly wish to see how restricting funding for those studying for an equal or lower-level qualification than one they already hold is impacting the nation’s skills level.

Changes in the world of work mean that many people who already have a level 3 qualification, if they are made unemployed and need to retrain, will need to be able to study for a subsequent qualification at this level or below. The lifetime skills guarantee extended the entitlement beyond those aged under 25 to all adults, but only to a limited list of level 3 qualifications and only for those who do not already have one. It is vital that adults are able to reskill at a lower level in a skill area different from the one already mastered, if that will enable them to gain employment.

This really important amendment calls for the Secretary of State

“to publish an annual report on the impact on re-skilling of funding restrictions on those who wish to pursue a qualification at a level equivalent to or lower than one they already hold.”

Photo of Lord Aberdare Lord Aberdare Crossbench

My Lords, I have also added my name to Amendment 45A from the noble Lord, Lord Watson. During the first day of Report, the noble Lord, Lord Coaker, spoke about previous unsuccessful skills improvement initiatives and asked,

“why will it be different this time?”—[Official Report, 12/10/21; col. 1765.]

Why will the Government’s new skills system, as embodied in the Bill, work better than its predecessors? In my view, one of the answers will need to be a really vigorous and well thought-through approach to reporting, monitoring and evaluating the different elements of the strategy and how they all work together. The lifelong learning entitlement and the lifetime skills guarantee—I think I have those the right way around—are essential elements of the strategy but need to be transformed from slogans into realities. A crucial part of achieving that will be review, review, review.

I might prefer this amendment if proposed new subsection (1) ended slightly differently, to read, “a report on the impact on the overall levels of skills in England and Wales of all the provisions of this Act”, rather than confining itself to

“the rules regarding eligibility for funding for those undertaking further or higher education courses.”

In the meantime, I will content myself with supporting the noble Lord’s amendment as it stands—with its effect of ensuring that the impact of the equivalent or lower qualification rule is at least reviewed and assessed on a regular annual basis—while encouraging the Minister to look at beefing up further the process of reviewing the overall progress of the skills strategy, beyond the performance monitoring and review of designated employer representative bodies described in her letter to us.

Photo of Baroness Bennett of Manor Castle Baroness Bennett of Manor Castle Green

My Lords, I slightly unexpectedly find myself to be the first person to speak to Amendment 40 in the name of the noble Lord, Lord Watson of Invergowrie, also signed by the noble Lord, Lord Storey, and me. Amendment 45A calls for a review to look at the issues around a restriction on allowing people to study at a level below that which they already possess. Amendment 40 goes further in removing restrictions.

I would have thought that naturally the Conservative position would be a belief that the person best placed to decide their best course of study would be the individual concerned rather than the state. This is a question of individual choice, about people knowing best their own situation. Therefore, while I very much support Amendment 45A, which at least calls for a review, I would go back to the more fundamental change in Amendment 40.

I am also in favour of Amendment 36 in the name of the noble Lord, Lord Storey. Education is a public good. We hear a lot of talk about investment for levelling up. Well, investment in people is the most fundamental investment of all. It is flexible, it enables people to make choices for themselves. A new or improved railway line or better school facilities are there and accessible to people, but people making their own choices is what investment in education is all about.

I am also in favour of Amendment 48, not yet addressed by the noble Baroness, Lady Sherlock. I will leave her to fully explain this, but it is worth stressing that what does not get measured and focused on does not get funded or supported. That is the principle behind that amendment.

Photo of Baroness Sherlock Baroness Sherlock Shadow Spokesperson (Work and Pensions), Shadow Spokesperson (Education)

My Lords, as this is my first speech on Report, I welcome the noble Baroness, Lady Barran, to her new ministerial role, and place on record my thanks to the noble Baroness, Lady Berridge, for her hard work on the Bill and her openness and willingness to engage with those of us on this side.

I speak specifically to the government amendments in this group. My noble friend Lady Wilcox will talk about the others in this group. We would have preferred them to be de-grouped, but time is short. However, the Government were planning to bring back for Report detailed amendments on the lifelong loan entitlement. Since they have now decided not to do that, we are left with several questions which I must ask. I apologise for doing so on Report, but we have not had an opportunity to do so otherwise.

In Committee, the Government tabled some amendments which were presented as providing some of the wiring in the basement of higher education that would be needed when Ministers unveiled their renovation plans in the form of the LLE. However, since those plans must wait until another day and, we are told, until more primary legislation, because Ministers want to wait for the consultation first, we are left with some big questions. One obvious question is: when will the consultation happen? Indeed, why is it not already out there? What is holding it up?

Ministers have brought back some parts of the wiring amendments on Report. The LLE is meant to cover courses and modules in FE and HE. Clause 14 amends the Teaching and Higher Education Act to allow for the funding of courses in FE and modules in FE and HE, a lifetime funding limit and for funding not just for an academic year. Clause 15 amends HERA to change the definition of a “higher education course” to make it clear that the regulatory regime applies to modules. Government Amendment 39 defines what a course and a module are. However, at the risk of being nerdy, I point out that the Government have not brought back the parts of an amendment that they tabled in Committee which required the Office for Students to specify fee limits for modules as well as courses. We are told offline that the Government will provide for modular fee limits after the consultation. Will that require primary legislation? Does any other aspect of the LLE require primary legislation? If so, can we have a timescale for it? If not, can the Minister say how and when Parliament will have a full debate on the shape and scope of the LLE absent primary legislation?

Where does that leave us in the gap between the Bill taking effect and the new regime being brought forward? If THEA will now permit student loan funding to cover modules which are not taken as part of a full course, does that mean that a provider could do that now but with no fee limits, or would that require regulations to be made, perhaps under THEA? If so, can the Minister assure the House that no such regulations will be brought forward ahead of the debate on the primary legislation promised to enable LLE?

I have three other questions. First, does the same definition of a module in the Bill, as it will be amended, apply for all purposes—funding and regulation—in both HERA and THEA? I ask because Clause 15 as amended by government Amendment 39 offers a definition of a module, which I mentioned in Committee. However, new subsection (1)(e) in Clause 14(1) provides that regulations under Section 28A of HERA may prescribe the meaning of “module” in relation to HE or FE. Can the Minister clarify that distinction? Secondly, on funding, irrespective of how LLE develops, does it mean that a module can be funded via the student loan book only if it is part of a full course? In other words, would the Bill as amended exclude a module which was not part of a qualification?

Finally, the Bill brings the regulation of modules clearly within the remit of the OfS but there are lots of outstanding questions about what quality looks like for modular provision. The OfS has just closed its second-phase consultation on its proposals for new quality and standard conditions, in which it repeatedly stressed that their new conditions were designed to work for modules as well as courses. It will shortly consult on new quantitative metrics. The current measures—student continuation, completion, and progression to graduate jobs—will self-evidently not transfer across to modules from full HE courses. Is the intention for that consultation to consult on new metrics which will apply to flexible modules as well as full courses? If so, is the Minister concerned that this may pre-empt decisions of this House?

I am concerned that by legislating now on the regulation of flexible provision but holding back on funding and other details, the law is being changed without adequate scrutiny of what the new system will look like. Why have the Government brought these amendments back now? Why not hold off until we have that new primary legislation and Parliament can have a full, informed and coherent debate about how this will work?

Photo of Baroness Wilcox of Newport Baroness Wilcox of Newport Opposition Whip (Lords), Shadow Spokesperson (Wales), Shadow Spokesperson (Work and Pensions), Shadow Spokesperson (Education) 2:45, 21 October 2021

My Lords, as the Bill before us today is about education, I hope that noble Lords will not mind me veering slightly off topic for a moment. Today marks the 55th anniversary of the Aberfan disaster, the catastrophic collapse of a colliery spoil tip on 21 October 1966 that killed 116 children and 28 adults as it engulfed Pantglas Junior School. I was a pupil at Pontygwaith Junior School in the Rhondda at that time, another valleys primary school built on the side of a mountain, and as we returned to school after lunch we were sent into the yard and told to put our hands together, close our eyes and pray for the children of Aberfan. I had never heard of Aberfan at that time, but I have never forgotten it since.

I speak to Amendments 40, 41, 45A and 61 in the name of my noble friend Lord Watson, who unfortunately, because of the change to the timetable, is unable to be here today. The Government originally promised to table LLE amendments ahead of Committee, but unfortunately very few of substance materialised. We were told that they would be tabled for Report, but we have now been advised by the Minister and her Bill team that this was not possible and that they intend to consult and pilot the lifelong loan entitlement before returning with new primary legislation. This is disappointing given that the LLE is supposed to be the Government’s flagship policy and is urgently needed, but it is not surprising, because the sheer complexity of what they are trying to build was immediately apparent to all—apart from, it seems, the Bill team.

Perhaps the delay will give the Minister time to reflect on the length of the LLE. At present, it will offer up to four years of equivalent funding for levels 4 to 6, and while for some people this may be enough, for others it simply will not be. Undertaking a foundation or access year plus a three-year bachelor’s degree, which is a common route, would use it all up in one go. Therefore Amendment 41, requiring the Secretary of State to consult on extending eligibility to six years to give greater flexibility, is important. It will be especially important to those studying part-time and help to encourage adult learners to take up an offer to study and upskill. It is supported by the Association of Colleges, training providers and other stakeholders that we have engaged with in preparation for this debate.

I am very grateful to the noble Lord, Lord Storey, for tabling Amendment 43, which allows the Secretary of State to make provision for the LLE to include maintenance provisions to include living costs to help disadvantaged students. We tabled this amendment in Committee and, as my noble friend Lord Watson highlighted then, one of the main barriers for adult learners, highlighted in the DfE’s own impact assessment, is the cost of study, including living costs. Yet, as drafted, the LLE covers only tuition costs. The Welsh Government recently introduced reforms to tackle this issue by extending maintenance support, including means-tested grants to all students regardless of mode of study, while maintaining low tuition fees for part-time study. Unsurprisingly, this has had a huge impact on participation.

Amendment 40 removes the equivalent or lower qualification—ELQ—exemption rule for the LLE to ensure eligibility for student loan funding for another qualification at that or a lower level, to facilitate career changes. It also ensures LLE eligibility regardless of subject, intensity of study, institution or learning style. We are concerned that, unless reformed, the ELQ rule could pose a significant barrier to further education providers working with local employers to deliver training in priority sectors that support communities.

I will not repeat in full the arguments my noble friend Lord Watson gave on this issue in Committee, nor will I repeat the searching and directly targeted questions from my noble friend Lady Sherlock. The ELQ rule means that anyone qualified to level 4 cannot access government loans or grants to study a qualification at an equivalent or lower level. I suggest this must be urgently reconsidered if the LLE is to succeed in providing opportunities for people to reskill for a new career where such skills are in demand. According to the Office for Students, there are exemptions to the ELQ rule if it is a qualification in a public sector profession, such as medicine, nursing, social work or teaching, or if the student is studying for a foundation degree or receiving a disability student allowance.

Mayoral combined authorities with devolved powers have begun to move away from the ELQ rule. Indeed, the Conservative-controlled West Midlands Combined Authority is running a pilot offering fully funded care management qualifications at level 3 and 4 to black, Asian and minority-ethnic women regardless of their prior attainment. The Augar review also proposed scrapping the complex ELQ rule. The need has been recognised, and there are precedents for the Government to follow.

It was disappointing that the noble Lord, Lord Johnson, withdrew last week what was then Amendment 42, requiring the Secretary of State to publish an annual report on the impact on reskilling of funding restrictions on people requiring a qualification at a level equivalent to or below the one they already hold. We were supportive of that amendment, so it has been resubmitted in the name of my noble friend Lord Watson and appears as Amendment 45A. I do not propose to elaborate, as it is self-explanatory.

Another complex area concerns credit transfer arrangements to allow students to move between education providers. Amendment 61 is a probing amendment designed to elicit more information on this. A universal credit transfer system would have significant benefits to many students, not least in terms of widening participation. The Open University’s OpenPlus programme, where students initially study at one institution before completing their studies at another, is an example of what can be achieved. I would be very grateful if, ahead of consultation, the Minister can outline how the Government intend to address and overcome the lack of commonality which my noble friend Lord Watson raised in Committee. Can she say what discussions the DfE has had since then with the devolved Governments and what those discussions have produced? Any scheme for allowing students to use credit flexibly must enable transferability across the UK—many people living in Newport study in Bristol, and vice versa—and internationally. It also needs to support credit transfer not just in HE but between FE and HE. I hope the Minister can say how she anticipates that will be facilitated.

Photo of Baroness Barran Baroness Barran The Parliamentary Under-Secretary of State for Education

My Lords, I thank the noble Baroness, Lady Wilcox of Newport, for reminding us of the tragedy of Aberfan and the terrible loss of life on that day. I will speak first to the amendments in my name on the lifelong loan entitlement and then respond to your Lordships’ amendments.

The amendments being laid today primarily address the technical underpinnings of the LLE and make other minor corrections to enable a strong legislative framework. We are laying them now to introduce the enabling powers for the Secretary of State that are necessary to the delivery of the LLE from 2025. The Government previously set out that we would table additional amendments, as your Lordships have noted, outlining further detail on the modular fee limit policy of the LLE. Following further policy development and engagement with stakeholders, including debate in Committee in this House, the Government have decided not to lay these before we consult. As noble Lords have noted, these are complex issues and it is essential that our final policy approach is informed by the needs of students, providers and all key stakeholders. This complexity was demonstrated in Committee by some of the questions on the detail and implementation of the lifelong loan entitlement. Given the intricate nature of such legislation, we must not pre-empt further policy design or decisions based on the consultation.

The noble Baroness, Lady Sherlock, asked what the consultation will contain. We intend to seek views on our ambition, objectives and coverage. This will include aspects such as but not limited to: the level of modularity —this will cover the minimum number of credits a course will need to bear to be eligible for funding; maintenance support; how to support quality provision and flexible learning; how to incentivise and enable effective credit transfer; and whether restrictions on previous study should be amended to facilitate retraining and stimulate high-quality provision. We intend to bring further primary legislation following consultation. This will allow us to meet the rollout timetable of the LLE from 2025, as originally planned.

The noble Baroness, Lady Sherlock, describes herself as nerdy; in my world, that is a great compliment. I thank her for her kind remarks about my getting to grips with the role, but I also commend my noble friend Lady Chisholm, who has found herself on an equally steep learning curve. To be clear on the timing of the LLE consultation, we commit to delivering the LLE from 2025. We cannot give the noble Baroness a firm date today, but it will be lined up so that we can deliver on that commitment. She also asked whether fee limits would require primary legislation; I can confirm that they would.

The noble Baroness also asked why the Government are laying amendments on the LLE now rather than waiting for future primary legislation—I have an instinctive feeling that, if we had not laid these amendments, she might have challenged the Government on our commitment to really delivering on this. Part of the reason is to be absolutely clear that there should be no doubt about that level of commitment.

In terms of the definitions of a module in the Bill, from both a funding and a regulatory perspective, I know that the noble Baroness has been in correspondence with colleagues in the department and I am happy to put a full, detailed response in a letter in the interests of time. The THEA and HERA legislation have two very different purposes. The former makes provision for loan funding via a broad set of regulation-making powers for the Secretary of State; the latter is principally about the regulatory regime—the powers of the Office for Students—and specifically enables the setting of fee limits for higher education courses by the Secretary of State. In Clause 14, new Section 28A(1)(e) modifies Section 22 of THEA by inserting new subsection (2ZA). That enables the Secretary of State to define what “module” means in relation to a higher or further education course for the purposes of making loan regulations.

Clause 15, which is to be amended by the government amendments, takes a slightly different approach due to the different regime that it covers. It clarifies that a module of a “full course”—an HE course, for example, mentioned in Schedule 6 to the Education Reform Act 1988—is itself a category of higher education course for the purposes of Part 1 of HERA 2017 when it is taken separately from the course from which it is derived.

Finally, the noble Baroness asked whether it was the intention that a module can be funded via the loan book only if it is part of a full course. The funding of modular loans will be delivered via regulations, using the modified powers to THEA under Clause 14 of the Bill, as noted earlier. The policy intention is for the lifelong loan entitlement to fund whole courses—or their component modules, if taken separately—that meet the necessary regulatory requirements and are provided by or on behalf of a registered provider. All registered providers currently offering loan-funded provision should be able to offer modular learning through the LLE. It is not the policy intention to fund modules that are not component parts of whole courses. The Bill would allow for regulations that could include or exclude from funding modules that are not part of a qualification. We will consult on the scope and policy of the lifelong loan entitlement, including seeking views on objectives and coverage, together with aspects such as the level of modularity.

The noble Baroness also asked about the regulations on fee limits and whether these would be introduced ahead of debate on the primary legislation. Any fee regulations would have to follow an affirmative resolution procedure, so there would be a debate in both Houses if and when the primary legislation has been introduced. I hope that that answers the noble Baroness’s questions, and I thank her for giving me warning of them.

As I was saying, we intend to bring further primary legislation following consultation, and we are still committed to meeting the rollout timetable of the LLE from 2025. As a number of noble Lords have said, we share that vision for lifelong learning to make sure that everyone, no matter where they live or their background, can gain the skills that they need to progress in work at any stage of their life.

As part of the lifetime skills guarantee, the lifelong loan entitlement will be introduced from 2025, providing individuals with a loan entitlement to the equivalent of four years of post-18 education to use over their lifetime. The LLE will create a flexible skills system through which people can build up learning over their lifetime and have a real choice in how and when they study. It will make it easier for students to navigate the options available, and it will encourage provision to meet the needs of people, employers and the economy better. We will endeavour to keep the House updated on the progress of the development of the LLE.

I turn now to the government amendments in my name, which seek to do three things. First, they will clarify what is meant by “module”, in reference to a higher education course. Secondly, they will avoid introducing a potential bureaucratic burden on providers. Thirdly, they will correct a previous error in legislation surrounding the teaching excellence framework. Specifically, Amendment 39 will amend Clause 15, which itself amends the definition of “higher education course” in the Higher Education and Research Act 2017, to make express provision for the regulation of modules.

Currently, the post-18 education student finance systems do not provide for modules. The LLE will transform student finance by supporting more flexible and modular provision. These proposed changes will provide the explicit underpinning for the delivery of modular provision. On Amendments 37, 38 and 39, Clause 15, once amended, will make specific provisions for modules in Part 1 of HERA 2017, which relates to the regulatory regime under the Office for Students. These amendments also reduce the potential burden on providers to provide or publish information in relation to modules under Section 9 of that Act.

Amendment 59 relates to the high-level quality rating, which is currently an award under the teaching excellence and student outcomes framework—TEF—for providers without an approved access and participation plan. Higher education providers with a TEF award currently benefit from an uplift to their fee limit, which means that they are able to charge at a higher level than higher education providers without a TEF award.

There is currently an error in the legislation that could prevent a timely link between TEF awards and a provider’s fee limit. For example, let us consider a provider that does not have an approved access and participation plan. Whether that provider is entitled to the TEF fee uplift in any academic year is dependent on whether it had an award on 1 January in the calendar year before the relevant academic year. This means that a provider seeking to charge the TEF fee uplift in the academic year 2022-23 would be able to do so based on an award in force in January 2021, rather than January 2022, which was the original intent. This amendment will correct this and ensure that there is a more timely link between fee limits and the TEF, helping to further incentivise excellence in higher education. Amendment 73 to Clause 27 is a related consequential amendment that sets out that the new clause in Amendment 59 will come into force two months after Royal Assent.

Finally, I turn to Amendments 68 and 69, which set out the territorial extent of the provisions contained within the Bill. The LLE provisions extend to England and Wales but apply in relation to England because we are making amendments to the English student finance system. The noble Baroness, Lady Wilcox, asked about our engagement with the devolved Administrations. We have engaged with them on the LLE and on other measures in the Bill, and contact and engagement continue as work on this area progresses.

Overall, we believe that these changes will help pave the way for more flexible study and for greater parity between further and higher education. As I said, we will consult on the detail and scope of the lifelong loan entitlement in due course.

I will now respond to your Lordships’ amendments and I thank all noble Lords for their contributions today. I turn first to Amendment 36, in the name of the noble Lord, Lord Storey. The Government warmly share the noble Lord’s desire to promote lifelong learning. However, this amendment would create significant fiscal and logistical challenges. It has the potential to disrupt our established loan support system in order to accommodate an additional system of grants. This would substantially increase costs to the taxpayer, both in the costs of such grants themselves and in their administration.

The amendment would mean that every individual in England would have a personal education and skills account. A report on this policy was published by the Independent Commission on Lifelong Learning in March 2019, setting out that the maximum total liability to government of PESAs would be £6.6 billion per year. It is worth noting briefly that this figure is likely to be an underestimate, because the PESA envisioned in that report was for a £9,000 sum, rather than the £10,000 suggested here.

The amendment also suggests that a new body would be created to administer these learning accounts for every adult resident in England. This process would have to happen seven years before an individual can first make use of any funds at age 25, and integration of these new accounts within the Student Loans Company’s existing operations would have significant cost and operational impacts. Moreover, there is an opportunity cost to the Government depositing thousands of pounds into these accounts, only to be left idle, waiting for an unknown point of use. This poses a strong contrast to our current loan support, made available at the point of study. Finally, these significant changes would risk delaying the rollout of the lifelong loan entitlement beyond 2025.

Turning next to Amendment 41, from the noble Lord, Lord Watson, the Government’s vision for a four-year post-18 education loan entitlement mirrors the four years’ full-time undergraduate training recommendation of the Independent Panel Report to the Review of Post-18 Education and Funding. As many noble Lords will be aware, the panel reported following extensive consultation and stakeholder engagement, and sought specifically to promote both uptake of higher technical qualifications and flexible study through this recommendation.

The recommendations made were intended to strike the right balance between taxpayers and students. This amendment would potentially enable much greater cost to be borne by taxpayers than has been proposed by the Government. It is also worth noting that the existing flexibilities for part-time students will remain under the LLE and that part-time study would be able to exceed four calendar years, as needed. This would mean that, as currently, a student could study a course of four academic years at a lower intensity, over, for example, six calendar years, if they desired.

I turn to Amendment 61, again from the noble Lord, Lord Watson. I warmly welcome the interest that he has placed on ensuring that the Government have the powers needed to deliver the LLE, and agree strongly with the underlying principle. The Government believe that at the heart of the LLE is enabling greater flexibility. Where appropriate, learners must be able to accumulate and transfer credit between providers, building up meaningful qualifications over time. The Bill, and the government amendments we have tabled on the lifelong loan entitlement, provide the building blocks of a modular system; we intend to come back with further legislation once we have consulted on how that system should be made to work best in the interests of students.

In developing the LLE, we are working closely with the sector to understand current incentives and obstacles to credit transfer and recognition. We will examine how to support easier and more frequent credit transfer between providers, working towards well-integrated and aligned higher and further education provision, with flexibility that enables students to move between settings to suit their needs. So while we welcome the push behind this amendment, it remains important that consultation informs our approach to credit transfer. We must not predetermine the outcome, nor pin the Government to a path of top-down regulation, without understanding fully the impact on providers and learners.

I will now address Amendments 40 and 45A, tabled by the noble Lord, Lord Watson, on retraining and ELQs. The Government agree that many learners need to access courses in a more flexible way to fit study around their work, families and personal commitments, and to retrain as both their circumstances and the economy change. Developing skills across the country is a key priority for the Government as we seek to build back better from the pandemic.

In April, we launched the “free courses for jobs” offer as part of the lifetime skills guarantee. This gives all adults in England the opportunity to take their first level 3 qualification for free, regardless of their age. The offer builds upon the pre-existing legal entitlement for 19 to 23 year-olds to access their first full level 2 and/or level 3 qualification, which the free courses for jobs offer complements. Through the adult education budget, full funding is also available through legal entitlements for adults aged 19 and above to access English and maths, to improve their literacy and numeracy, and to access fully-funded digital skills qualifications for adults with no or low digital skills.

However, I should also note that existing equivalent or lower qualification rules were designed to help maintain a sustainable system. As such, we are designing the lifelong loan entitlement to support students pursuing higher and further education flexibly, but also to share the costs fairly. We want the lifelong loan entitlement to provide value for money to students, the education sector and the taxpayer. The complexity of this balance and the transformative nature of the LLE are among many reasons why we intend to consult on the detail and scope of the LLE before legislating on eligibility. It is crucial that careful consideration of the needs of providers, learners and stakeholders informs our final policy design and that we do not pre-empt the findings of the consultation.

Regarding Amendment 45A, introducing an ongoing review on eligibility into primary legislation before the policy detail is yet finalised may also prejudice the outcome of the consultation. Additionally, the Government believe that a yearly report without an end date could be an undue and non-proportionate burden to be tied to at this stage.

I again note that Amendments 40 and 45A would be out of kilter with similar legislation passed previously in your Lordships’ House in relation to student finance. As outlined earlier, much of the detail of how the system works, such as exact eligibility criteria, has been set out in secondary legislation, and the necessary monitoring and review will be undertaken after changes have been implemented and had time to embed.

On Amendment 43, tabled by the noble Lord, Lord Storey, I can reassure him that the Bill already provides the necessary powers for maintenance support. Clause 14(1) modifies the powers in Section 22(1) of the Teaching and Higher Education Act 1998, so that regulations will be able to provide for maintenance and living cost loans for eligible students taking designated modules of higher or further education courses. The introduction of this would follow consultation, which, as I have mentioned, will cover maintenance support. This amendment is therefore not necessary but I warmly welcome—and the Government agree with—the underlying principle: a need for appropriate support for students while they undertake their studies.

The Bill makes explicit provision for supporting the introduction of the lifelong loan entitlement. The funding of modules of courses will help create a more flexible system of provision across higher and further education. As I have said, much of this work is subject to the consultation on the lifelong loan entitlement, which we will be launching in due course. As such, I would hope that noble Lords will feel able not to move their amendments when they are called.

Photo of Lord Storey Lord Storey Liberal Democrat Lords Spokesperson (Education) 3:15, 21 October 2021

I thank the Minister for all her comments. I beg leave to withdraw Amendment 36.

Amendment 36 withdrawn.

Clause 15: Lifelong learning: amendment of the Higher Education and Research Act 2017