Education, Children and Young People Committee

Meeting date: Wednesday, November 15, 2023

Official Report 710KB pdf

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Independent Review of the Skills Delivery Landscape

The second item on our agenda today is an evidence session with James Withers on the independent review of the skills delivery landscape.

We will move straight to questions. I have a broad opening question. It has been some time since your review was published. What assessment have you made of the response to the review so far?

First of all, thank you for the invitation to speak to the committee today. I spent some time at the Economy and Fair Work Committee a couple of months ago, and it is good to speak to members here today.

How would I characterise the response to the review? In general, I am heartened. I met the cabinet secretary and I have subsequently met the minister a couple of times to discuss progress with the implementation of the review. There was an early signal that they welcome the general direction of my recommendations. I have landed them with a big job to reform a complex system. There were initial announcements on skills planning going back into Government, which is one of the recommendations, and having a single funding body.

This might sound counterintuitive, but I am heartened by the fact that some time is being taken to consider the review, rather than there being a rush to say, “Yes, we agree all the recommendations. Let’s go.” That is because it is such a complex area and there will be unintended consequences. When you lift the lid on one thing, you find other things for sure. Considering the series of recommendations for big structural and operational reform that I came up with, alongside the work that Louise Hayward has done, which supplements the work that Ken Muir has done and that Grahame Smith did on careers, that approach makes sense to me.

My one nervousness is that momentum might be lost. Anyone doing such a review fears and dreads the idea that the review will just sit on the shelf. I do not get the sense that that is what is happening, but I think that keeping up the momentum is critical.

You said that you have met some members of the Scottish Government, which has published “Purpose and Principles for Post-School Education, Research and Skills”, which it says is the initial response to your review. Is anything major missing from that response?

No, it is a really helpful document. One of the main areas of concern that I had was that, within the whole skills system, there is no single definition of what “good” looks like. I was asked to look 10 years ahead: how do we build a skills system that is fit for the future? My first question was, how would we know that we have a skills system that is fit for the future? The reality is that there is no single definition of what is good or what success is. Worse than that, many different parts of the skills and learning system had their own version of success and they did not necessarily talk to one another.

The advantage of the purpose and principles document is that it starts to set out some of the values that we are trying to embed in the whole learning system. Although my report suggests big structural reform, I identified a few key steps that could be delivered early, one of which was established in the purpose and principles document. I am pleased to see that that work is being done.

Thank you, James. We will move on to some questions from Ross Greer.

James, you have said that you are somewhat heartened by the fact that the Government has not just rushed into a response to your recommendations. However, your overarching recommendation is that this should be seen as a coherent package rather than a pick ’n’ mix. How concerned would you be if the Government did not accept your recommendations in full? If the Government takes a more selective approach to what it wants to take forward, how could that be managed?

I think that cherry-picking elements of the review would worry me if it was driven by what might be expedient or felt easiest to do. I do not have a sense that that is where the Government is going from my discussion with ministers, but the reason why I positioned my findings as a coherent whole is that I was seeking to build a more coherent system. My overriding observation, having spent nine months inside the system, was the scale of fragmentation. I was expecting to see complexity and some fragmentation, but the scale of fragmentation within the system surprised me, in a way.

If you want a joined-up system, you need to join it up, and that includes all the moving parts. To me, having a single qualifications body without having a single funding body, and a crystal-clear approach to who is delivering business support, who has leadership on careers, and who has leadership over skills planning, would mean that it would remain a fragmented system—hence the need for the system to be looked at as a whole.

It sounds as though the most important response is that of the Cabinet Secretary for Education and Skills and the minister, which have been broadly pretty warm. You certainly seem optimistic about that.

What do you detect the response from within the system to be? Part of your report is—entirely fairly—pretty critical of elements of the system and of how they communicate and interact with each other. Part of the discussion with the previous panel of witnesses was about the issue that overrides a lot of education reform at the moment—that might be an unfair way of putting it, but you will get what I mean—which is that the people who have been responsible for a system that has come under a lot of criticism are then responsible for changing that system. If they do not buy into and do not accept the premise of the need for change, we can end up with a rebranding exercise rather than the more fundamental changes that are required. What responses have you picked up from those who are involved in delivering the system as it currently stands?

It is a risk to ask the same agents, who might feel criticised for what has gone before, to deliver comprehensive change. I tried to position what I had done as a forward-looking exercise; it was not really about scoring anyone’s homework or carrying out a performance appraisal. However, I came to the conclusion that our skills system is not fit for the future. Even if it was firing on all cylinders, it could not possibly be fit for the future because of the scale of change that is coming. When I started this work in September last year, no one wanted to talk to me about AI; now it is all that they want to talk to me about. The pace of change is remarkable.

The response that I have had from parts of the system has been mixed. Generally, there has been a pretty warm welcome for the diagnosis. The prescription depends on your part in the system and what has been prescribed for you. I have met a lot of practitioners who have an appetite for reform. In fact, I did not meet a single person in nine months who felt that the system was working optimally, and most people called for a pretty radical reform of the system. However, if, for example, Skills Development Scotland is to be substantially recast, as it could be, into our national careers agency and to provide leadership there—I think that it has the chance to deliver a transformational impact by doing that—we need to be careful that such a body is in the mindset of embracing change and is not in any way hurt, concerned or scarred by the fact that it is losing other functions. Ultimately, whether they are in the right mindset to drive that forward will be for the judgment of ministers, but it is a legitimate risk.

I recognise that this is a somewhat different bit of work, so it is fine if you are not across the detail of it. Are the processes and structures that are being used for setting up the new qualifications body and reforming Education Scotland similar to what you think would be required to deliver on your recommendations? Looking at what is happening in that space, would you be concerned if that was the approach that we took to implementing what you have recommended?

To be honest with you, I am not close enough to it. I spent more time in the education system than I had planned to at the start of the process, but the evidence took me there, particularly in careers, apprenticeships and the future of the curriculum. I spent some time with Louise Hayward on the work that she was doing, because there were very similar themes across our work.

My plea is that, throughout the reform process in education and the wider skills system, we keep absolutely arrow focused on the customers and users of the system. Sometimes the reform process, understandably, gets bogged down or disappears down rabbit holes, talking to the delivery agents rather than the customer end.

My review had strengths and challenges, and I probably succeeded in some parts and failed in others, but I tried to take that whole-system approach, step out of the whole thing and think, “In 10 years’ time, where do we want to be?” That kind of mindset and approach is critical, but I am not that close to the detail and structure that has been set up to deliver the educational reforms.

The report states that your interpretation of success is about everybody having equitable access to learning opportunities and being able to reach positive destinations in their work and life that can help Scotland’s economy to flourish. How should we measure that success during the implementation period of the recommendations? Should we use qualitative data, quantitative data or a mix of the two?

It is probably a mix of the two. My definition of a positive destination is defined by the individual and not by Government or society. For example, our universities are incredible and world class, but our entire education, schools and learning system is still dogged by the idea that university is the golden pathway and that any other pathway is a varying degree of second best. There is pressure to achieve five highers, because that is deemed to be the golden success in school—that is the culture—but, in many schools, that probably leaves at least half of the pupil population behind.

For me, that is a system that is not achieving success. There are other metrics out there. University attendance across multiple socioeconomic groups remains a valid way of measuring things, and a higher attainment level remains a valid measure of success, but it cannot be the only game in town.

In many ways, the challenge of measuring other forms of success is that they are subjective—a sense of wellbeing, a sense of contribution, a sense of hope or a sense of personal satisfaction. Economists find it very difficult to count such things. You can count jobs and grades, but you cannot count a broader sense of wellbeing or a sense that you have reached a positive destination.

That is a wider economic issue, but we need to find a way of trying to do that, because, at the moment, we have jettisoned a broader sense of truly measuring what might be a positive destination for an individual—it might not be a university or a collection of grades—in favour of just measuring those things. It leaves a lot of people behind and, crucially, stigmatises an awful lot of learning pathways that will be massively important for us going forward.

Should we ask the young people themselves?

Yes, that would certainly be a good start. I thought about that in relation to the conversation that I had last night with my son about what he is going to do after sixth year. Young people at 16, 17, going on 18, do not really know how they would measure success in their lives or what they want to do next. There has to be continual monitoring of that throughout their lives.

One key issue in the skills work that I did was the need to take an all-age focus. There is an understandable focus on young people, which is obviously critical, but we need to have an all-age focus on skills development and equipping people to maximise their own potential.

11:30  

We heard last week about the real need for a culture change, but change takes a long time and this one could take up to 10 years. What would be a reasonable timescale for embedding change and is there anything that you think would help to expedite that culture change?

A 10-year horizon is not unrealistic for the scale of change and reform that we are talking about. To go back to a point that I made earlier, there is no agreed definition of what success in our skills and learning system looks like. In the absence of that, I attempted to write a version, which is that everyone should have equitable access to the learning opportunities that they need in order to reach a positive destination.

It is important to establish a definition of success and a vision that all parts of the system can buy into. I found a system that is full of good people who are passionate about equipping people with skills for the future, but they define success within their own particular lane. Those who fund universities focus on universities; those who fund apprenticeships focus purely on apprenticeships. There is no broad view of how the system works together, so it is absolutely critical to establish that vision.

Thereafter, this might be a long haul. If I am nervous about anything, it is about the fact that the public sector requires at least two things—time and tolerance—to be able to reform properly, but it rarely has either. It is rarely given much time and there is rarely much political tolerance. The benefits of the scale of reform that I think needs to be seen will not be seen quickly, and that could be pounced upon by those who resist change.

I have a short follow-up question. Would equipping the leaders right at the top of education with skills in systems thinking and systems leadership have positive influence?

There is a dearth of systems thinking within the broader public sector. That is entirely understandable, because people are measured by the key performance indicators that sit on their desks, which tend to be entirely related to their own particular role and do not take a broader view. For example, I do not see passes at higher as being a KPI that we should necessarily focus on, because that is a process point. The output comes from looking at what an individual does with the highers that they achieve, or, if they do not achieve highers, what they go on to do.

I tried to take a whole-systems approach to the skills system. That is not easy, but it would be good to embed systems thinking in the public sector.

My final point is that we should not necessarily assume that the public sector has the skills for broad reform.

The review mentions other recently published reviews of education and skills, and you have spoken about your engagement with Professor Hayward. How can the Scottish Government best oversee this period of reform? How quickly can we move forward? In your opening answer, you talked about being glad that some time is being taken to consider implementation but said that there should a balance.

There should. Mr Greer asked about responses from practitioners in the system. There is a fair degree of cynicism about what will happen afterwards, because this feels a little bit like death by review.

There is a real opportunity to find the common threads between my review and the others, and you do not have to look too hard to find them. There is a need for a curriculum for equity as much as for a curriculum for excellence and for parity of esteem. There is a need to recognise that the chase for grades is only one part of the system and that boiling 13 years of education down to how much someone remembers for two hours in an exam hall might not be the smartest way to determine their future potential. There is also a need to recognise that individuals can have a whole heap of skills that will not necessarily allow them to flourish in traditional academic routes.

To answer your question, it is important to recognise the common themes in Grahame Smith’s work on careers, in Professor Hayward’s work and in mine. I am less close to Ken Muir’s work. Those themes of parity of esteem and equity of access to opportunity are there and are clear.

The other key thing is to provide a much greater degree of autonomy and to trust the people on the ground who deliver. In my case, that was about giving regions much greater power over funding and establishing educational provision in their areas, giving them the ability to work with business and there being a lot less control freakery at national level. A national agency telling an individual college how many apprenticeships it can have on a particular course seems mad to me. We should give greater freedom.

I did not hear much of the evidence from the previous panel of witnesses, but I imagine that the average headteacher would welcome greater autonomy and the ability to be more creative. There is a need to devolve greater power to the individuals and put greater trust in practitioners to deliver what is appropriate in their setting. That is a common theme that runs through other reviews.

You talked about momentum earlier. Should there be momentum for pressing on and making progress on change and implementation in relation to the common themes that are shared between the reviews?

Yes. Take my report as an example. I set out a clear aspiration that there should be absolute clarity of responsibilities.

I found a system that is incredibly complex. I take great heart in it being complex, because it has an incredibly complex set of customers from different backgrounds with different requirements and aspirations, so it should be complex. The problem was a lack of clarity. Having multiple different agencies involved in qualifications, funding, business support and careers provision makes the landscape murkier than it need be for practitioners and, ultimately, customers of the system.

There are steps that could be taken. We could say that we will make the system clear. We could have a crystal clear lead on qualifications, funding, careers, business advice and skills planning but also recognise and be honest that we are talking about cultural reform. That refers to the mindset of parents as well as young people, businesses and the system as a whole.

There are things that can be done that set a direction of travel, including defining what good looks like and clarity of responsibilities and roles, but we also need to be honest and recognise that that will involve cultural reform, which will take time and the benefits might not be visible for some years.

Mr Withers, you said earlier that public sector reform takes time and—please excuse me.

Tolerance.

Tolerance. That is the word that you used, wisely.

A common theme that we have heard from a number of people who have given evidence to us recently is that the political arena needs to create the space and have the maturity and tolerance to enable the change that needs to happen. Do you want to say anything more about that? It is a responsibility that we and our colleagues need to share and about which we need to be serious.

I am politically an optimist. I noted that my review was part of a debate last week. I have seen a strong cross-party consensus and I engaged with most of the parties—I certainly reached out to all of them—during the process. That there needs to be reform is not up for debate. The how is where there will be division of opinion.

I will make a purely political observation. We have at least two years before we might enter another Scottish Parliament election. That feels like a window of opportunity to harness that cross-party consensus and drive change forward before things get spicier politically. Although I say that a longer-term, cultural, decade-long journey is starting, there is a window of opportunity to try to make the momentum unstoppable.

Then parties will need to be responsible as to how they position themselves before 2026.

They will. I am sorry, convener, can I make one final point?

You have lots of opportunity to make lots of points, Mr Withers. You are okay. Carry on.

The change will require a strong ministerial stomach, too. It is big reform. I have already seen parts of the system putting their defences up. Complex systems naturally evolve on their own. They have done that and there has not been sufficient ministerial direction of the system. Although such systems evolve on their own, however, they do not reform on their own. This reform will be difficult and lots of people will be able to say, “You can’t do this because it’ll do that,” so it will require real ministerial bravery to drive it through. I hope that cross-party consensus will make having that courage less fraught or perilous than it might otherwise seem.

That is a really helpful and important point. Some of the feedback on the review that I have received in my capacity as a constituency MSP has been on ensuring that we meet the needs of industry and the economy in a tight labour market—something that we have discussed in different capacities in the past—that is the result of external factors. What engagement needs to happen with the business community to ensure that, in that overall scenario, we nurture and consider its needs as well as young people’s abilities?

That issue comes back to the theme in my work around regionalisation and giving greater autonomy to individual areas to drive forward the establishment of educational provision and shape the kind of frameworks and qualifications that are developed.

Where I got to was that the DYW network is great and has real potential but that it is still a story of unrealised potential. I want to see the establishment of a network of regional employer boards and a national employers’ board to help to shape the entire learning system.

One of my recommendations that has proved quite controversial, I suppose, for those who currently perform that role of apprenticeship approval—the Scottish Apprenticeship Advisory Board—is that that board should be wound up. That is not because it has not done its job but because it has proved that employers can shape part of the system. However, unfortunately, the apprenticeship system has been carved out from the rest and put on one side; it has not been mainstreamed. I have suggested that we wind that function down and embed the principle of employer involvement in shaping our learning framework in every single part of the learning system, not just apprenticeships.

That is why I would like to see the DYW boards resourced and taking on more responsibility to really drive that at a regional level. There will be different views within DYW but, personally, I would also like to see the “Y” element dropped from DYW, because it has the potential to help shape the system for all ages, not just young people. There is huge potential in using that as a mechanism for business and industry to help to shape the future of the whole skills system.

Thank you for joining us this morning. I think that you used the term “death by review” earlier. Do you have any concerns that your review will get lost in the multitude of other worthwhile reviews and documents as time is taken, by necessity, to look at them?

Yes, because it has happened before. I have spoken to people who have done reviews such as this, and I have been involved in such reviews before. They fall by the wayside because priorities change and events arise. My instinct is that there is enough commonality across the reviews and enough general momentum to ensure that the system has to change because of what is happening out there, including changes in the economy, society, technology and the new industrial revolution. There is no longer a question whether there should be reform; the question is how it is done.

I would be lying if I said that I did not have a human fear that you do all this work and it ends up not going anywhere. All I can do is take in good faith what I am told by ministers and, probably, also what I have heard from a lot of people who are involved in the delivery of the system, which is that there is enough in the work that I have done—alongside the work of many others who came before me—to create a momentum that might be unstoppable. However, yes, I have certainly had dark moments when I have thought that I might have wasted nine months of my life—hopefully I have not.

We have talked a wee bit about where we are in the political cycle and you mentioned “time and tolerance”. How do you square off—as you expressed it—time and tolerance against the urgency that you have undeniably put across today and in your report, bearing in mind the political cycle and all the other potential barriers and resistance to change?

11:45  

It is an incredibly difficult balancing act, and I am not sure that you can square it off. You need to make a judgment as to whether you are willing to sacrifice some progress in the short term, because there is a bigger, longer-term dividend that can be grasped.

As I said, I identified five early steps that I felt that the Government could take to develop the purpose and principles; get the new skills planning process motoring and embedded in Government; determine a new model for funding to embed equity of access and parity of esteem; and carry out an audit of qualifications, which are a mess of terminology.

Again, this is personal, but, in helping my son to choose his sixth-year courses, I found an alphabet soup of acronyms, with NPAs, FAs, SFW—national progression awards, foundation apprenticeships, skills for work—highers and advanced highers. Those are all beautifully mapped out on the SCQF framework, from level 1 through to levels 10 and 11. How on earth have we managed not to use that framework and not to refer to levels 6 and 7 and instead have come up with different terms? That blows my mind. That solution is sat there; we could embrace that, and we could establish the employer boards.

There are steps that can be done quickly but within an overarching framework and definition of what good looks like. While we are working on individual areas of improvement or implementation, there should be an understanding of how that feeds into the longer term, so that we stitch together the urgency of action and the longer-term game. That is the only mechanism that I would use to stitch the two together: identify what we can do quickly and be crystal clear about how that feeds into the broader, perhaps decade-long, journey.

We go to Pam Duncan-Glancy.

Good morning—I think that it still is morning. Thank you for answering our questions so far and for the work that you have put into your report. I will start with questions that are on the same theme that we have already discussed—leadership and reform—and then I will move on to funding. How will the Scottish Government taking responsibility for skills planning bring about the required culture change?

There is an important point around skills planning, and I would divide it into a game of two halves. It is a difficult challenge, but there is a need to identify some critical national priorities for skills planning that are relevant for all parts of Scotland and to which every part of the country will need to respond. I have not said what they are in my review. There will be different views on that and on whether the priorities should be net zero, green skills or digital.

Beyond the critical national priorities, we need to release the regions to do the rest. There might be two or three national priorities and we would expect all parts of the country to develop their version of skills plans to respond to those. My instinct is that, now that we have city region deals and eight economic regional partnerships in place, we should use them. If we are trusting them to manage billions of pounds-worth of investment, we can trust them with the skills plan that sits alongside that and free them up to determine what the plans look like.

On the balance between national and regional, I do not think that Scotland is big enough to have 32 or even eight different skills frameworks. There should be a national framework, but the detail of that could be driven by regional areas, and at the moment there is not enough autonomy at regional level for that.

There is an element of leadership at national level around the two or three priorities. That is a tough call because, if you get them wrong, you will get hammered. It is difficult to pick three winners. After that, you are not jettisoning everything else—you can focus on individual elements. Hospitality is important to the Highlands and Islands and Argyll and Bute because of the tourism industry, so let them develop their plans on that, working with businesses, colleges and others. However, get the balance right between national and regional. Does that answer the question?

It does—I appreciate that. In a similar vein, do you agree with Universities Scotland that some of the changes that you have suggested, including those that you have just described, can happen without legislative change? What decisions could be taken now around funding work-based learning or upskilling and reskilling, without legislative change?

Yes, I agree with that. Skills planning does not require legislative change, and I am no legislative expert. To establish a single qualifications and funding body, I have suggested that a recast SDS should be founded in legislation, which it is not at the moment, to deliver careers.

Some of that would require legislation. However, some of the cultural aspects around levels of autonomy, thresholds for authority and releasing the regions to crack on do not require a legislative framework. In my mind, it is more the way of working that needs to change.

Could that be done quite quickly?

Yes. One of the first things that the Government talked about was bringing skills planning in-house. A lot of skills planning work is happening, so there are good skills plans in place. South of Scotland Enterprise has done great work with SDS and other agencies and colleges. There are good plans in place that should not be torched or put in the bin—they can crack on. However, where there needs to be greater autonomy to deliver some of that, that could be done, but it would require a real mindset and, to some extent, political bravery to release the reins a little bit, to trust those on the ground to make some of the decisions, and to recognise that, when we do so, some things will go wrong. It is guaranteed that they will go wrong, but the overall benefit will outweigh the odd case study where stewardship of money has not been absolutely perfect.

Thank you. I suppose that that links back to your point about the ministerial stomach, which is important.

I will move on to ask about the role of colleges and universities, and the funding in that space. Colleges Scotland said that the skills framework that you have outlined, and skills in general in Scotland, rely on a strong college sector. Do you agree with that?

I do. I worked in and around the skills system for maybe 15 or 20 years, but in quite a narrow lane—from a business and trade body perspective. There were large parts of the system that I did not know in depth, but I have got to know them over the past nine months. The college sector is in that category.

I have been blown away by the potential of the college sector. I spent time inside colleges, and I was excited, enthused and came away buzzing at their potential. They are rooted in their communities, connected to businesses and well connected to high schools, and they deliver real practical skills and learning to individuals who were viewed—and might still be viewed—as having somehow failed academically because they had not collected a bunch of grades.

The potential of the college sector is phenomenal, but I worry about it. It is a burning platform in relation to finance and sustainability. I worry that we might see a more chaotic reorganisation of the sector, based on the law of natural selection—who is most vulnerable, who might fall and who might not—which might need to be looked at in time.

Given where the economy is going, what businesses have told me and what I have seen in relation to the skills that are required, the college sector is an absolute jewel in our crown, and the more that we can do to support it and, crucially, embed it at the heart of regional skills planning, the better—I have met some colleges that felt that they were not around that table. The sector is a huge asset.

I share your concerns about the sector’s funding, as do colleges and universities. For example, Universities Scotland said that it is not necessarily the methodology that is the problem but the fact that university places for Scotland-domiciled students are chronically underfunded in Scotland and that there is more and more reliance on international students. Of course, the numbers of international students coming to Scotland are dropping. Does that context for universities and colleges concern you in relation to skills for the future?

The whole funding piece was a really interesting area for me. It would be fair to say that, when I was appointed to do the review, I was given a very free hand. There was an underlying message of, “Don’t come back with something that’s going to cost a lot more.” That is entirely understandable, given the fiscal position that we are in. That said, we spend £3.2 billion every year in this area, which must be 5 to 7 per cent of the Government’s entire budget.

I do not think that the problem is underinvestment, but there is duplication and inefficiency in the system. That said, you cannot ignore that you have a line of university and college principals and staff who are worried about funding. I think that more can be done to release some of the shackles. Universities should be free to determine, for example, how much of their provision they want to put into full-time education versus delivering graduate apprenticeships and degree apprenticeships through an earn-and-learn approach. At the moment, graduate apprenticeships are capped every year, their funding is uncertain and they are separated off into a different system. Why do we not trust universities to use that funding as they so wish? I think that elements could be released, but, as in probably every sector of the learning education system and of the economy, funding is a concern.

My final question is, what duplication did you notice in the system?

That comes back to a lack of clarity. Multiple agencies were involved in qualifications development; in funding, of itself; and in the development of some of the educational frameworks. At the moment, it can be difficult for a business that is interested in workforce development to know whether to go to Business Gateway, the local enterprise company, Jobcentre Plus or Skills Development Scotland. There is a natural duplication in the system. It is born not of any bad intent but of a system that has been allowed to evolve, is fragmented and does not collaborate as tightly as it could, as well as a lack of political direction to shape the system.

Stephanie Callaghan, do you want to ask a supplementary on that?

Yes. Earlier, James, you said that we have to accept that things can go wrong when power is handed down regionally. That makes me think about political and ministerial accountability. What are your thoughts on that? When an aeroplane crashes, a team goes in to look at why that happened. Given your business background, can you say in what kind of direction accountability would not be an issue?

Business culture and political culture are often very different. Most business schools will talk about permission to make mistakes—that we learn more from our mistakes than we do from our successes. It might be incredibly naive to say that we could achieve a political system that would allow for that. Certainly, if I was the accountable officer for a major agency, I would live in perpetual fear and terror that something would go wrong and I would be in front of an audit or other committee, being scrutinised as to why money in one area did not deliver what it was supposed to, or—worse—ended up in the wrong place. That is just the way of life.

My observation is that, overall, the benefits that will be achieved by putting greater trust in the people who deliver things on the ground and who are connected to businesses, colleges and universities will far outweigh the problem. However, more political and media scrutiny is on the bits that go wrong, so I might just be incredibly naive.

Good morning, Mr Withers. On a similar topic, one of your structural recommendations was the establishment of a single funding body that would cover SDS, the Scottish Funding Council and, potentially, the Student Awards Agency for Scotland. I think you said that the rationale for that was a “fragmented” system at the moment that impacts the ability of providers to deliver. What are the risks of not going forward with a single funding body?

I will use apprenticeships as an example. They are an incredibly important part of the whole learning system. The establishment of apprenticeships as a critical part of our learning system required a distinct focus, distinct funding and, probably, distinct agency ownership. Those things are exactly what is now holding apprenticeships back. As long as apprenticeships remain carved out from our wider learning system—over on one side, with a separate agency, separate funding, separate KPIs and uncertain annual funding—they will remain separate from the system and will not be mainstreamed.

Dividing university and college funding into SFC and apprenticeship and training funding into SDS crystallises a false divide between “education” and “vocation”—the idea that education delivers learning and vocation delivers skills—whereas, in reality, the position is much more nuanced. Clearly, education delivers skills for the workplace and vocational routes deliver broader learning on problem solving, innovation and other things. To be glib, if you want a joined-up system, you need to join it up. Having funding brought together into one place makes sense.

There are real risks in that, though. One of the risks is that, unless we have a culture that recognises the enormous value of apprenticeships, putting them inside a body that has hitherto largely looked after university funding risks diluting the focus on them. The timing is critical. On balance, in order for apprenticeships to be properly mainstreamed, they need to be plugged into the mainstream of funding, qualification development, curriculum development and careers provision. Although I have not stipulated it in my report, we might need some safeguards there. There are certain thresholds of funding that have to be ring fenced for certain parts of the system. Overall, though, I felt that, by bringing funding into one place, we are more likely to end up with a joined-up system.

12:00  

I am grateful for the detail.

The committee has been alerted to another risk. Universities Scotland gave us a very useful submission, in which it suggested that, with a single funding body, there could be a risk to the status and autonomy of universities and their Office for National Statistics classification. It would have exactly the opposite effect in that it would restrict universities’ ability to respond to needs. Were you aware of that risk when you made your recommendation? If so, why did you nevertheless make the recommendation? If not, does that cause you to reflect on whether it is the right recommendation?

I understand that the creation of a single funding body does not, in and of itself, present that risk. It is more about what the status of that body is—in other words, whether it is a non-departmental public body. I deliberately did not get into what the governance status of that body should be, partly because it looked like a bit of a rabbit hole and was incredibly complex. I walked away from that.

The only body on whose legislative or governance status I made a specific recommendation was Skills Development Scotland, in relation to its future. That was for two reasons. First, I was specifically asked to do that in the terms of reference. Secondly, SDS’s unusual status as a public company that is limited by guarantee, rather than one that has been established in statute or is an executive agency—an NDPB—did not feel appropriate for a body that is ultimately about delivering a public service and being accountable to ministers.

I did not take a view on what the governance status of the new funding body should be, but I hope that it will be taken as read that I would not want that body to be set up in any way that jeopardises the status of universities or their relationship with the ONS. If that requires it to be an NDPB—I will leave that to others who are better versed in public sector models for agencies—then that is what it requires. However, I do not think that that in itself is an argument that we should not bring funding together under one body.

Thank you, Mr Withers, for an interesting background and for the review, of course.

On the back of what you have just been talking about, the review suggested the importance of setting national priorities. You might not want to point the finger at who should take responsibility for that, but what are your thoughts on how those priorities could and should be divided? What should be taken into account?

That recommendation, as much as anything, lands Government with a difficult issue. Everyone agrees with prioritisation until they are not a priority. That will be challenging, not least for different sectors of industry. I used to work in food and drink, and the idea that food and drink would not be a priority would be a declaration of war to businesses in my old sector.

Who should make the decision is one question. Obviously, we have a national strategy for economic transformation and a national strategy for economic transformation delivery board, which have a pivotal role. However, one of the reasons why I recommended establishing not only a network of regional employer boards but a national employer board was to help to inform that process. It needs to be informed by business and also by third sector and other groups. How we might establish those priorities, though, and for how long a priority should remain as such will be political calls.

My observation on NSET is that having a longer-term, 10-year horizon for economic ambition is a very good thing. My criticism would be that it prioritises everything that currently exists and everything that is coming down the line, which then does not feel like prioritisation. There is a need to define the areas of Scotland’s competitive advantage. Alongside business voice, I would add insight and foresight on where the economy is going and identifying where Scotland has competitive advantage and strength, where it has competitive opportunity, and which areas of significant change will affect the four corners of Scotland. Although I have been asking other people to be brave, I have not been brave enough myself to identify what those are. I would probably use the example of the transition to net zero as one aspect that would be in there. At the moment, we have lots of reference to green skills but I do not know what they are. No one has drilled down to say what they are.

Most people have the idea that the Government should eventually take responsibility for many things. Should it be led along a path of working with other organisations and groups in society that have experience of the green skills and business elements to bring responsibility across a board before those are put into policy?

There is a real strength to doing that. Thinking back to my experience in the food and drink sector, the Government used to write the strategy for the industry, which did not make any sense to me. The Government has its role, and it does not strike me that it is in the best place to write a strategy for any industry. However, it can be quite easy for industry to allow that to happen, because then, when things go wrong, it is the Government’s fault and there is no ownership of it. There is an important principle about industry and business taking ownership of their own strategic directions.

How we embed such a structure into day-to-day Government work is something that Governments wrestle with. We have advisory boards, steering groups and stakeholder groups by the dozen, which help to inform that process, but they are a valuable part of the approach.

The other important aspect is the need to compare our approaches with those of other countries—what we might call comparator nations. Patently, we are not the only small country that is trying to work out how to transition to net zero. We must look at that more broadly than our relationship with other European Union countries. In my previous work I studied skills systems from elsewhere, such as those in Germany, Switzerland, Singapore and Ireland. In the food and drink sector, most of the good things that were done, and most of the successes, involved ideas taken from elsewhere.

That is very helpful. Thank you very much indeed for that.

Mr Withers, at the outset of the session you mentioned how, at the beginning of your review process, people were not really talking about AI but that, now, it is all that they are talking about. As your review is sitting there, I am curious to know how adaptable it is to the pace of change that we see happening externally.

I would probably use that example to justify why I did not pick my winners out of all the priorities, because technology moves at such a rapid rate. I had hoped to consider how we could build a system that could pivot to absorb whatever the priorities, opportunities or challenges might be on a particular day. I hope that my review has made some contribution to that.

In all the work that was done between me and the secretariat that supported me, I tried to follow the evidence. It was clear that people wanted a more agile and flexible system. That is easy to say but really difficult to deliver. Having a system that gives greater autonomy and ownership to places and regions to determine what is right for them allows them to pivot when an opportunity occurs. For example, if a big inward investment is made in an area and a company lands there and has a particular skills requirement, we should free up the system to allow it to work in a more agile way. Such an approach will work regionally rather than nationally.

My hope is that, in taking a whole-system approach and building such a system, we can create a machine, in a sense, with agility and flexibility built in, that will be free to move with changing priorities and opportunities.

Is there anything that you were hoping to present to us this morning that you have not had a chance to say? I know that that is an open question.

No, I do not think so. We have touched on the culture of reform, for instance. I think that we have covered most areas.

To refer to what your first panel focused on, I view educational reform and reform of the curriculum and of what is happening in schools as absolutely integral to the broader skills piece. It is a cliché to talk about starting as young as possible, but parity of esteem and equity of learning opportunity are the ball game here. Culturally, practically and financially, the system does not embed that. It serves too small a proportion of the pupil population and the wider population of the country.

Scotland’s working-age population is shrinking, and the ONS thinks that our population will shrink faster than that of any other part of the United Kingdom. The immigration situation is different now that we are out of the European Union. The need to make the most of the skills and the potential of our population requires us to reform the education system as well as the post-school skills and learning environment. The two go hand in hand, and I think there is a lot of good in what Professor Hayward is proposing that I can relate to, from what I have seen.

What do you think the Scottish Government should do next?

I go back to the point about establishing a vision for what good looks like, which should be the north star, so that we are clear about where we are headed.

I caught the end of the previous panel discussion, and it was said that we are never going to achieve consensus, so we should give up on that. We should be bold and take some decisions, with the certainty that there will be people who will be upset and nervous about that. In my experience, the people who will be upset, nervous and discombobulated by that will not be customers of the system; they will be people involved in the delivery of the system. Care less about them—that is my message to the Government. Keep the momentum and try to make that momentum unstoppable. That means setting out the vision and starting to take some of the early steps. I have identified five that I think could be taken to make it much more difficult to reverse out of reform than to carry on with it.

That is super, James. Thank you for your contribution today.

That concludes the public part of our proceedings. The committee will now consider its final agenda items in private.

12:13 Meeting continued in private until 12:42.