Lifelong Learning Inquiry
We move to item 2—I am sorry for holding back Wendy Alexander a bit.
I welcome Wendy Alexander, the Minister for Enterprise, Transport and Lifelong Learning, who is here with Ed Weeple, the head of the Executive's lifelong learning group, and Heather Jones. I ask Wendy to give her introduction, after which we will ask questions.
I will pick up where the committee left off. I thank the committee for the opportunity to comment on its interim report. I learned from my officials how well the convention went on Monday—I thought that it would be inappropriate for me to attend it.
The process of being open and inclusive to stimulate a debate has been helpful. It has focused the minds not only of the committee but of the wider learning community on what our big strategic objectives should be if we want to be a learning nation. As the process has shown, that debate is much needed. That is one matter on which we have much common ground.
We have made significant progress in advancing lifelong learning in recent years, but there is much more to do. I will touch on how the creation of the enterprise and lifelong learning department has put learning and skills close to the work that we do on enterprise, which has been broadly welcomed.
Economic and demographic realities feature in the committee's report and I hope that we can strengthen the focus on them in the coming months. In the next 20 years, the size of the 20 to 34-year-old age group will decline by 25 per cent. While the number of young people declines, it is expected that the UK will have 2 million extra jobs, of which Scotland's pro rata share will be 200,000, so I would welcome further guidance from the committee on the need to focus on adults and on SVQ levels 2 and 3 for adults in the work force.
We need to think further about how to create the right routes and pathways for everybody in the work force. We also need to think about those who will be looking for the jobs of tomorrow. We have done a lot to try to get that interface right. To a large extent, I share the principles that are set out in the committee's recommendations. I appreciate that the report is not final, but my initial reaction is that I am sympathetic to a number of the proposals.
I will turn to the provisional conclusions. We are interested to see what emerges from the deliberations of the convention on Monday and are also interested to see the work that the committee plans to undertake over the next three months. A minister is bound to say this, but we have a lifelong learning strategy for Scotland. We have tried to avoid the glossy brochures—we are too often criticised for them—and we have focused on delivery.
Ten years ago, 25 per cent of the work force had no qualifications; today, the figure is 10 per cent. Half our school leavers go on to further and higher education, and 80 per cent of those in higher education complete their courses. If those two measures are taken together, Scotland is at the top of the European league. Take-up of further education is now at its highest level ever. The huge response to learndirect Scotland—there were 5 million hits to its website last year—has surprised us all. Huge strides have been made in the past 10 years. That said, there is more to do.
I want to contrast the progress that we have made in Scotland with that which has been made in England and Wales. The creation of the Scottish Further Education Funding Council and the decision to move further education closer to higher education, rather than to move it down to make it closer to the workplace, is a development that has stood the test of time.
We are ahead of the rest of the UK in dealing with the student support issue. We have begun to equalise further and higher education student support. As members know, that issue has emerged in evidence to the committee. We have expanded further education by 60,000 places, which is 20,000 more places than we said we would create three years ago. As members also know, there is not an equivalent to that figure elsewhere in the UK.
We are funding directly access in universities, in order to deal with the issue of low participation from the sons and daughters of hard-pressed families. At present, there are 20,000 modern apprenticeships, which is way ahead of the rest of the UK. Another way in which we are ahead of the game is that learndirect Scotland has sought to become not a provider, but a broker of education services. It is more successful because of that.
We are also ahead of the game because we have put skills at the heart of our economic development agenda. In England, the regional development agencies have no locus on human capital, which is the aegis of the learning and skills councils. We have a better institutional architecture in Scotland. We have created careers Scotland, which is an all-age service, whereas England has stuck with a youth service. As the committee report acknowledged, the Scottish credit and qualifications framework puts Scotland out ahead in that respect.
Although there is a determined need for further progress in all those areas, devolution has delivered them, which has put us ahead of the game. The challenge of the next three months is to examine how we can preserve that lead, both institutionally and operationally, vis-à-vis the rest of the United Kingdom.
I share the emphasis that the report places on high-quality guidance and informed choice. I welcome the significance that the committee has placed on a flexible qualifications framework. That is an area in which the committee is not defending vested interests of any kind, but celebrating the potential and opportunity that we need to unlock if we are to create flexible pathways.
We need to deliver more effective work-based training. The skillseekers scheme needs to be overhauled. We need our young people to have a sense of credible pathways, which allow for a work-based route but give a stronger focus to core skills and personal skills development than might have been the case in the past.
I will mention one area to which we give slightly different emphasis than does the report. The learning market has two consumers: one is the learner—it is right that we should be learner centred—but business is also a key customer of learning. We did some work on the numbers. The joy of being in my department is that you can commission civil servants and statisticians to examine the numbers. Employers in Scotland are spending in the order of magnitude of £2.2 billion on the provision of work-based learning. That compares with the £1.3 billion that the Executive provides. In the next three months, the committee might want to consider that further.
Although I talk about making every person ready for tomorrow's jobs, we have also to make every business ready for tomorrow's Scotland. It is depressing that one third of the people who acquire lifelong learning do not have the opportunity to use it in the workplace. The committee's observations on how we can deal with that problem would be helpful.
As members know, we have brought about huge institutional upheaval over the past three years, which does not have a parallel in England and Wales. We have created the two funding councils, bringing further education closer to higher education; we have created careers Scotland; and we have put human capital and skills at the heart of the enterprise agenda. In all those initiatives, and in the creation of individual learning accounts, considerable institutional change has taken place. I am not sure that, less than four weeks after the creation of careers Scotland, we should rush into destabilising an institutional architecture that has not had the opportunity to bed down. We can, however, make progress on operational issues.
I welcome this opportunity to come here to testify. As the committee knows, the Executive has been considering higher education, but we were keen to leave the rest of the lifelong learning space for the committee to introduce its ideas. We did not want to pre-empt the committee's deliberations.
We published our initial higher education consultation in October, and we intend the second consultation to come out towards the end of this month, allowing the standard 12-week consultation period. We hope to come to some conclusions on higher education, probably after—well, it will have to be after—we have received the committee's report and have taken into account the crossover between lifelong learning and higher education.
We have been doing an in-depth review of vocational education and that is why I am keen to go on record as saying that we have to consider skillseekers and the balance between competences and core skills. We will publish research shortly that supports the wide body of evidence on the need to work with employers to strengthen work force development. I hope that that research will be useful to the committee. The research is being conducted by the University of Glasgow and it reaffirms that, although employers invest in training, serious inequalities of provision exist. Often, for small firms, the barrier is not cost but accessibility and the availability of work-based training, as the committee's report makes clear.
It would not be proper for an Executive minister not to end on the cost-neutral or budget-neutral question. I do not want to pre-empt the committee's deliberations, but because the committee's report notes that there will be a redistributive effect, I would welcome the committee's views on where we are looking for winners and where we are looking for losers. When it comes to moving money around the sector, the vested interests will loom large. I would therefore welcome further discussion and guidance on the issues—it is really a pleasure to see someone else struggling with those dilemmas.
I look forward to receiving the committee's report—whether that happens at the start or the end of the summer recess. I will comment fully at that time.
Thank you minister—perhaps we will do the costings after the election.
Before I open up the meeting for questions, I would like to clarify something about the definition of lifelong learning. I have read the Executive's lifelong learning strategy, which links into the higher and further education strategy, but is different. The Executive's lifelong learning strategy is generally about post-higher education and does not cover further education, whereas the definition for our inquiry incorporates the whole picture of higher education, further education, the Executive's strategy, volume training and so on. We should be clear about the definition.
How can I say this tactfully? There is no one document. There is not a document setting out current Executive practice and thinking down to the last dot and comma, precisely because we wanted the committee to have policy space.
I do not want to be in the position of saying that the totality of our current thinking on lifelong learning is embodied in one document, particularly one that was published before devolution. We stood back to allow the committee to take the lead in this area. I want to have the political courage to say that we will create the space for the committee to reflect on those issues. After that, we will publish the Executive's lifelong learning strategy, looking to the future. At the same time, I do not want people to say that the Executive has no strategy. My response to that suggestion is that we have not published a strategy because the committee asked us not to do so.
The important thing for non-aficionados is to get a sense that this debate is about strengthening Scotland's lead in the area of lifelong learning. We have a common interest in getting that point across to the wider public. That is why I touched on the 10 or more areas in which we are leaders in a UK and, sometimes, a European context. We are debating how we extend and strengthen that lead.
Do you feel relaxed about the concept of entitlement?
I would like to be clearer on what is meant by entitlement. I am very relaxed about having a debate on entitlement and about the notion of entitlement. However, I am keen not to pronounce on the implications, form and consequences of entitlement in such a way as to reduce the space that the committee has in which to probe some of the issues.
Entitlement can be defined in a number of ways. It can be based on credit points, as is suggested at the moment. It can be defined in terms of the volume of funding that is available. It can be defined in relation to need or on the basis of universality. The definition of entitlement is still an open question. However, if one is aiming to create a lifelong learning culture in society, everyone should have access to further and higher education. That is an appropriate principle. The risks are that, in circumstances where we are seeking budget neutrality, any formulation of entitlement—be it credit based, needs based or age based—invites people to speculate about winners and losers. The challenge for us all is to stimulate change in the sector in such a way that it does not disrupt current advances that we want to preserve.
Thank you for your evidence. You said that devolution had delivered the leadership and improvements that we see in this area. Could you say more about that? What specific aspects of lifelong learning policy have changed with devolution?
I can provide the member with a number of examples. Unlike in the rest of the UK, human capital and learning and skills are at the heart of the economic development agenda in Scotland. There is no equivalent of the enterprise and lifelong learning department at UK level, where learning and skills fall within the remit of learning and skills councils. Further education in Scotland has been aligned with higher education, rather than moved in the opposite direction—down towards workplace learning and the former training and enterprise councils. Learndirect Scotland has a different role from its counterpart in England and Wales. In Scotland, there is also a different solution to student support. The UK participation measure is for people under 30 participating in higher education. The participation rate in Scotland stands at well over 50 per cent, so the focus here has been on expansion in further education, rather than on higher education.
I have listed a number of areas in which we are out in front and in which our approach is different from the UK approach.
Is that the result of devolution or is it simply the consequence of a specific administrative agenda in Scotland? Could the things to which you refer have happened without devolution?
Very largely, they could not have happened without devolution. One could quibble that, technically, some of the changes that I have cited would have been possible without devolution. However, reflection on the past half century would suggest that, in the pre-devolution world, decision making in Scotland was characterised by administrative devolution. Now it is characterised more by policy leadership. That is reflected in the level of diversity that now exists.
A University of Edinburgh academic who compared the diversity in education policy in Scotland over the past 50 years with that of the past five years would conclude that devolution has made a huge difference to the level of that policy divergence.
Thank you. It was useful to have that set out.
You said that we are at the top of the UK league and possibly at the top of the European league in further and higher education performance indicators over the past 10 years. That might be true, but our economic performance is near the bottom of the league. Why is that?
That is partly because of how we tried to compete economically over the past 40 years. I think that we agree on that analysis, Andrew. We were largely a location for market access into Europe when the European market was growing. Now we compete in a different world. The situation is like turning round an oil tanker. Our agenda is based on science and skills and accepting that Scotland is not significant as a regional player in market access because global players who are interested in market access have their eyes on Asia.
Scotland's opportunity is as a global location for intellectual property and innovation. That is why the existence and alignment of the enterprise and lifelong learning department is so important. Investment in learning and skills, which has happened, for example, in Ireland, does not pay instant dividends. However, investment in human capital that is pursued consistently over 20 years is critical and reflected everywhere. Our challenge is how we ensure that that investment in lifelong learning contributes effectively to our economic performance.
A depressing aspect, however, is people's view of the importance of higher education. We want a lifelong learning culture, but a lower percentage of Scots than people in the rest of the UK believe that education and lifelong learning is significant. Thirty per cent of Scots do not make use of the learning opportunities that are available. We are getting the institutional architecture and the investment right, but we have not won the battle for hearts and minds. That is a real challenge for us because of our population structure, with which you are familiar.
That is an excellent answer that gets to the heart of the growth problem, which is a challenge to us all. I appreciate the minister's comments. The minister set out the diversity of the policy debate, which was useful, and the challenges that face us.
My next question is an old chestnut, but I want the minister's view on it, especially as today is budget day in the UK. We do things differently in the learning area and manage to get a separate agenda going in Scotland, which is a positive achievement. However, how do we square that circle with the fact that the budget that provides the money for our agenda is set within a specific pot that is dependent on a policy programme for the rest of the UK? How can we progress aggressively a different policy approach in further education to get more people into education and contributing to the economy, when the budget for further education is dependent on decisions that are taken elsewhere?
I am tempted to rise to that challenge, but, in the interests of everyone else in the room, I will resist doing so. Politics has always been a language of priorities and, under any constitutional arrangement, one must make choices. Like you, Andrew, I like numbers. I asked the department to draw up for me the percentage change in real terms in the spend of every aspect of my department's budget over the past four years. The critical issue is that the budget for further education in Scotland has risen by 18 per cent in real terms over the lifetime of the Parliament. In higher education, the figure has risen by only 8 per cent. Scottish Enterprise's figure has risen by 4 per cent and Highlands and Islands Enterprise's by 8 per cent. That is a different pattern of spend from England's and demonstrates our capacity for making different budgetary choices.
I have a bigger point to make to the committee. In trying to get growth, our dilemma is that compared with our top five European competitors—we seem to be one of the top five, in the UK, for lifelong learning—our system is largely learner led. The committee has gone down that route. All our European competitors are more directive in encouraging people to go into areas of anticipated growth in the economy. Andrew Wilson's predecessor used to ask why we were funding so many hairdressers and so few engineers. Part of the reason is that, if we ask a 16-year-old what they want to be, they will say that they want to be a beautician, a hairdresser or a pop star. At 16, people have limited capacity to know what tomorrow's jobs are.
Careers Scotland will fix that in part, but not entirely. The biggest strategic choice that we have to make is whether to direct people to the areas in which we anticipate that there will be growth. On the spectrum of individual choice and encouraging people to go into the areas of future growth, we are less directive than almost all our competitors.
In the Parliament this afternoon, members will ask me questions such as, "Why do we have a 16 per cent decline in applications to study physics? Should we care about that? Should we try to do anything about it? Should we incentivise it?"
That we are out of step with our European competitors seems to be a critical philosophical issue. Through the process, we have to reach some common ground on that issue. I would like to see that addressed directly in the next few months.
The targets section of the report touched on that issue, but perhaps it was not enough.
I want to follow up your point about whether our system should be learner led or directive. The report has touched on that issue and we debated it quite a bit. We believe that the issue is about good careers guidance. Careers guidance should start early and should not just be pre-entry guidance but should be about a professional and social development plan for young people or adults. That was one of the points that we took in evidence.
You said something very encouraging about flexibility of qualifications. A big issue that was raised in evidence and at the convention, and which is reflected throughout the report, is that people want parity of esteem in their qualifications. I would like to put it on record that further education colleges deliver vocational education. Such training is delivered not just in the workplace, but through HNC and HND courses. One of the recommendations in the report is the creation of a technician-level qualification. Many people felt that there was a need for more technician-level employees, and perhaps that could be based around HNCs and HNDs. What does the minister think of that recommendation?
It is important that we build capacity for learning in business. I would like to hear the minister's views on how to achieve parity of esteem in work-based routes and how we can have better links with business. That is a key question for the committee. If we have one learning fund and individuals are choosing college or work-based routes, how do we achieve parity of esteem? How do we achieve flexibility of choice and opportunity in those two routes?
Let me run through three points. On the dilemma that I mentioned about whether we tell people what to do or let them choose, undoubtedly careers Scotland is part of the answer. We hope that we can help people make market-savvy choices. I am keen to encourage that.
It emerges strongly from the report that one of the keys to parity of esteem is portability. At the moment, parity of esteem is not helped because there has not been portability between the various learning routes. The committee places too heavy a burden on the Scottish qualifications framework; I would like the framework to reach the stage that the committee defines it at already. That has implications for how the Executive funds and supports the Scottish qualifications framework. The committee is slightly aspirational on where it wants the framework to be, but I share that aspiration. We need to consider how we resource it in order to allow it to drive portability. I hope that that will go a long way to delivering the parity-of-esteem agenda, which will be possible if we have portability. There will be lots of qualifications, some of which we will want to create and some that will disappear over time. The qualifications framework is the route to take.
On capacity building in business, there is no one answer. I will mention four areas. First, undoubtedly it is important that we continue to fund learndirect Scotland, because demand pull by learners matters. We now have in excess of 300 learning centres, but few of them are in employers' premises. We must examine that.
Secondly, the committee may be aware that we announced revised plans for regional selective assistance which, with regard to Andrew Wilson's point, would have been highly unlikely—I would go so far as to say unthinkable—in pre-devolution days. In future, we want RSA to be linked to work force development plans. It will take a lot of work for us to think through what that will mean, but we are trying to tie the level of award that employers get from reformed RSA to plans for work force development.
Thirdly, we have business learning accounts. We will talk later about the contribution that they might make to capacity building in business.
Finally, I was at the STUC yesterday, where I talked about learning representatives. The bill that will create learning representatives will receive royal assent in June. One of our challenges is how to enable people—in particular the over-50s in unionised workplaces who do not even have a level 2 SVQ qualification, and who feel that trade unions are institutions of trust—to say, "Look, it didn't used to matter that I didn't know how to read and write, but I am really struggling in my job as a lorry driver because I can't work the technology in this cab." People need somewhere to take that anxiety. Very often, their shop steward or their learning rep is that figure of trust. That is another dimension. RSA, business learning accounts, learning reps and learndirect Scotland are all part of the answer.
Ed Weeple (Scottish Executive Enterprise and Lifelong Learning Department):
I wish to add one point, which was made by a Confederation of British Industry representative at one of the lifelong learning convention workshops, on the important role that Investors in People can play. That does not have any prominence in the interim report, but it is important. IIP has played an important role so far in raising awareness, credibility and confidence in business. Perhaps it should feed in to the final report in relation to the list that the minister has given.
We did not receive evidence from IIP. We might wish to address that.
I am aware of the point that Ed Weeple raised. We are talking about having one quality system, which would help with parity of esteem. We should feed IIP into the evidence.
I want to ask about research at the higher end of education, on which we have taken much evidence. At the convention and in the evidence there was much discussion of skills shortages. The minister pointed to demographic changes. One of the worries is that we are losing a lot of research staff, because they are going elsewhere for more lucrative contracts. The Association of University Teachers raised the issue of terms and conditions, because short contracts are used and there is no stability. I know that the minister is keen to attract graduates back to the Scottish economy, but how can we do that? It is important that we get our education mix right, and that we keep the people who graduate.
There are two issues: one is the treatment of contract research staff in universities, and the other is holding on to skilled people. On the first point, I recently had extensive discussions with higher education principals. The truth is that in many ways, European workplace legislation will make the current pattern of contract staffing illegal. Substantial change is coming. More positively, we have to examine more effective career pathways for academics.
Academics' pay has fallen in relation to that of some of their peers' over the past 20 years. Equally serious is the fact that the quality of human resource development and career management structures in higher education has perhaps fallen behind what is expected in other parts of the public and private sectors. We have asked the Scottish Higher Education Funding Council and Universities Scotland to consider that and we will touch on it in the second round of the higher education document that we will publish at the end of the month.
I will refer to the loss of graduates overall. I read the convener's comments in the press recently in which he speculated about the figure of 1,000 graduates a year departing from Scotland and I badgered my statisticians to do more work in the area. The committee might want to examine that on another occasion.
Three different phenomena are interacting. One is Scotland's overall population decline and age structure, which is of concern. We are basically not producing enough kids and the population is aging. The second factor is the question of what is happening to graduates in terms of their first destination of employment when they graduate. The third factor is the net in-migration or out-migration of skilled workers in employment.
All three factors are important. The general population register gives good statistics on the first of those. I looked a mere 48 hours ago at the data on the destination of graduates. Some 76 per cent of graduates from Scottish universities are Scotland domiciled and the others are from overseas and England and Wales. Some 74 per cent of people who graduate from Scottish universities stay on in Scotland. That figure is 10 per cent higher than it was a decade ago. We are getting overwhelmingly better at holding on to Scottish graduates in Scotland. However, that does not answer the third question, which is on the quality of net in-migration of skilled workers in work. The research data that are required do not exist and more work on that would benefit Scottish public debate and would inform this and other debates.
Informal learning was mentioned a lot at the convention on Monday. Funding is important, but I shall put it aside for the moment. I am more interested in the question of measuring informal learning, which came out of the convention. You made a point about portability of learning and routes into other tiers of learning. The voluntary sector argued persuasively that it is a foundation for learning for many people. Is your department working on assessing how people who come through such informal learning routes are provided for? Could more be done in trying to assess what is happening in that area?
When we talked on Monday evening about what had come out of the convention, that was one of the two or three most significant issues that my officials put on the agenda for me. Ed Weeple might want to comment on it.
The issue is genuinely difficult, particularly in terms of current funding formulas, measuring informal learning and the way in which further education is funded. Measuring and accounting for informal learning is a genuinely difficult area and always has been.
It is difficult to fit it into the overall structure of the committee's report. If the whole structure is predicated upon a credit-based system and informal learning is, by definition, neither credit nor qualification based, one excludes a crucial area of learning, particularly in terms of access, early participation and progression. The committee has found difficulty with the issue and I do not pretend for a moment that the lifelong learning department and various other departments have not found difficulty with it. The education department and Communities Scotland have a crucial interest in it as well.
We have spent a lot of time over the past couple of years considering adult literacy and numeracy, in which community and informal learning plays a crucial role. Those issues have not been easy ones with which to grapple. As a report that was produced for us pointed out, they have been relatively neglected for the past 20 years. What came through in the lifelong learning convention was an appreciation that informal learning is important and that we must devote more time to it. We will take that message on board happily.
I appreciate the honesty of that reply. We must take more evidence on the issue to try to get some helpful suggestions.
My other question is about the role of the enterprise agencies. According to the minister's statistics, there has been £2.2 billion of business spend on workplace learning. Have there been specific recommendations to the enterprise agencies to help with that balance of spend? Does the document "A Smart, Successful Scotland: Ambitions for the Enterprise Networks" do enough on that issue or does more need to be done on the balance? The issue is important and the committee has tried to pick up on it.
In order to harness those issues, human capital and learning and skills must be at the heart of the economic development effort. I have often said that the Tories were right to bring the training agency into what—10 years ago—was the Scottish Development Agency. It was also right that the character of that link should not be about volume training, but about the totality of human capital and skills.
There are big operational issues to be resolved, but we continue to stay ahead of the game structurally. Two implications follow from that. One is that the training-for-work programme needs a substantial overhaul. That is under way. The market that the programme served has been residualised, in part by the new deal and in part by the labour market, which is more buoyant than it has been for a considerable time.
There is a role for new target setting. When the committee embarked on its consideration of lifelong learning, the Executive was already considering post-asset targets. We chose not to introduce them in order to create a space. The four targets that were set in "A Smart, Successful Scotland", which aimed to have every Scot ready for tomorrow's jobs, were right in terms of what to do with the non-education and training—NEAT—group. If we were having this debate five years ago, the issue would have been about what to do in relation to modern apprentices and at level 3. We have now largely fixed that problem. We must realise that although skillseekers was right for its day, we must do better now. We should return to considering level 2 and what it delivers.
My comment about entitlement is that we should not divert attention from the NEAT group, which comprises the 16 per cent of people who leave school with no education or qualifications. That sets back those people for the rest of their lives. That group was the second target. If I recall correctly, the four targets related to narrowing the gaps in unemployment levels between areas, the NEAT group, work force development and hinting at what had to be done in the workplace. Those targets were correct, but they must be complemented by a further set of asset-updated targets that take into account the population as a whole. I think that the appropriate point at which to set those targets might be in my response to the committee's report. I hope that there will be a lot of common ground on the targets.
I have another supplementary question. Do you envisage that, in setting the targets, you will take a close interest in business views? You described the £2.2 billion that business spends on workplace learning. I presume that the aim is to encourage business to spend more. Obviously, you cannot set a monetary level, but do you envisage trying to push that agenda forward? What mechanisms will you use to do so?
That issue goes to the heart of one of the dilemmas for the committee. I will make the anxiety clear. We must consider the case for divorcing the strategic economic engagement with employers—which is the mission of the enterprise networks—from the delivery of training. My view is that the case for that is not proven.
I want to tease out the issue of research. I was interested in the statistics for the increasing retention rates for researchers in Scotland. Obviously, international competition for top researchers is very strong. Will you speak a little bit about that? The statistics that you gave might mask the situation.
To the committee's immense credit, it has not spent a huge amount of time on higher education in its report. As members will know, I have been having dinner with all the principals in Scotland, so I will not embarrass them. The statistic is too raw for me to put it in the consultation document, so I will share it here. A principal said to me, "I have just spent £1 million in paying off dead wood and I have put only £11,000 into performance-related pay." Collectively, we need to find a way to fix that sort of balance in the period ahead. That is not to say that I want to replicate the US system wholesale. However, a system whereby courts and principals end up spending £1 million on letting people go on reasonable terms at the end of their careers and spending only £11,000 on the best people needs some attention.
Let me say something more positive. I will know more about this tomorrow. The issue about great researchers and the commercialisation agenda is how we can make it possible for our top academics to twin-track between running a department and being involved in commercialisation work. I shall talk to David Lane and Spiro Rombotis, who run Cyclacel, later today. David Lane, who is one of our most eminent scientists, will say that the problem is that, the minute he walks out of the University of Dundee, all the research income that he brings to that institution disappears with him. The incentive does not exist for any of the 19 grade 5* professors in Scotland to be involved in commercialisation. If they move wholesale into that, the internationally significant departments that they have built up might be harmed. There is an obligation on us to think about how we can make it possible for people to twin-track—to run their departments and continue to attract research funding to them and to become involved in the commercialisation agenda. I am sure that such twin-tracking has the unanimous support of committee members. We must create better mechanisms for that.
I know that the committee took great interest in the issue of research, and I was struck by some evidence that the University of Edinburgh shared with me recently. In excess of two thirds of the 29 start-ups that had been set up in the University of Edinburgh over the past year came from grade 5 and grade 5* departments. There is an issue at the high end about making twin-tracking possible.
I will ask about something completely different, which is schools and the importance of higher still and the impact that higher still is having. A limited amount of evidence is coming from research about higher still and the positive impact that it is having. Are you having any discourse with your education colleagues about changes such as higher still, careers Scotland and the link into the schools system?
At 9 o'clock this morning—before a Cabinet meeting—I told Cathy Jamieson that I would be attending the committee and that, unless we have better articulation with schools than we have achieved in the past to get the skillseekers bit right, it will be impossible to get the two years of national qualifications and higher still right in terms of core skills. That comes out incredibly strongly in the committee's report. As that is one of the committee's recommendations that I want to support strongly, I told Cathy Jamieson that I thought that the time is right for the education department and the enterprise and lifelong learning department to work over the summer on what it would take to improve that articulation, given where higher still and NQs are going. In our final response to the committee, we should have something to say on that agenda, which we all share. Cathy Jamieson and the enterprise and lifelong learning officials are committed to that and I think that that will be one of the real wins to come out of the work of the committee.
On Rhona Brankin's first point, the joint working party of SHEFC and Scottish Enterprise on knowledge transfer and the research base has made many of the recommendations that we made in our previous report on teaching and research. That report is now with the minister for her agreement and, I hope, implementation.
One of the things to come out of the convention and all anecdotal discussions in evidence is the fact that schools are a key building block to lifelong learning. Indeed, people who are not aficionados sometimes find it difficult to accept that schools are not included in a definition of lifelong learning. Are you satisfied that the existing structural arrangements within the Executive are delivering the continuity that allows schools to be a building block for lifelong learning? You answered Rhona Brankin's question about the specifics, but how will the report gel with Cathy Jamieson's national debate? It is clear to me that individuals' approach to lifelong learning is determined by their experiences at school.
That is very much the case. There is no doubt that the existence of careers Scotland was a prerequisite, because it has brought together careers service and education-business partnerships. In the past we have had the difficulty that education-business partnerships did great work in exposing youngsters to the world of work and the workplace. That work was quite distinct from the provision of careers advice. We have brought together those activities under careers Scotland, to enable people in school to have work-based experience and to think about their career opportunities in a much smoother way. That was a prerequisite for raising the quality of young people's experience of thinking about the world of work rather than just the traditional post-school education opportunities.
The committee might want to invite Nicol Stephen to testify on the education for work and enterprise review group, which we set up last year. Many prominent business people and entrepreneurs sit on that group, which is due to report soon. The work of the group deals with how to embed in the curriculum exposure to the world of work. Although that is technically the responsibility of my department, I was keen that the education department should lead on that. The perception existed that it would be difficult for us to be involved in exposure to the world of work in schools if that was viewed as an add-on to the curriculum, rather than as a core element of the curriculum. Nicol Stephen, who has worked as a minister in the enterprise and lifelong learning department and the education department, has led the education for work and enterprise review group. When considering the immediate post-school experience, the committee might want to invite Nicol Stephen to talk about what the education for work and enterprise review group is likely to say about the later school years and what is done to prepare young people for the world of work. The committee might also want to invite Christina Allon—I do not think that she has had the chance to testify to the committee yet—to speak about how careers Scotland will change the nature of what is done in schools. That would be a useful way of informing consideration of skillseekers mark 2.
We should point out that Christina Allon is the head of careers Scotland.
I would like to add that at every level of the enterprise and lifelong learning department we aim to work closely with our colleagues in the education department. For example, I am head of the ELLD's lifelong learning group and I sit on the supervisory group for the national debate on education. We strive to have crossover points wherever common issues arise. For example, both departments have a major interest in the operation and delivery of the Scottish Qualifications Authority. We recently held a joint meeting with the SQA's senior management team; senior officials of both departments met round the same table. We strive for a seamless effort across the two departments.
That continuity is also reflected in relationships between the relevant committees. From time to time, I meet with Karen Gillon—or, as is presently the case, Frank McAveety—and the clerks to discuss potential clashes.
I am glad that everyone is meeting.
We will invite you, David.
There are two elements to school—preparation for work and the experiential part of learning. I want to be clear that the experiential element is picked up as well as the preparation for work aspect.
You mentioned choice and need and where the balance lies. Do you accept that the school system gears people to go into higher education? Higher education has been perceived as the best thing that people can possibly do at the end of their school careers. However, that situation is not necessarily the best thing for Scotland's economy or, indeed, for the individuals concerned.
I will make three points. First, what you are looking for will be delivered by the fact that the best work of the educational business partnerships will now be available all over Scotland through the careers Scotland framework. Annabel Goldie and I both know that Renfrewshire had a superb education-business partnership, but some EBPs in other parts of the country were not so good. The philosophy behind the creation of careers Scotland was to provide a uniform quality of provision throughout Scotland for all the functions of careers Scotland's constituent organisations, of which EBPs was one. I am confident that the mission of EBPs will be delivered consistently throughout Scotland. However, that is a legitimate area to explore with Christina Allon.
Secondly, we need to consider whether young people are given the right advice about the variety of choices. The new notion is that a personal caseworker will stay with people from age 14 through to 24. The personal caseworker must be sufficiently knowledgeable about the labour market and must not encourage people only into the traditional education routes. The alignment of the careers service with the enterprise networks will help that.
Another thing that will help that is the creation of Future Skills Scotland. In the past, how were good careers service workers meant to know that joiners, software engineers or construction workers were being sought? There were no means by which a well-meaning careers adviser could know where the demand would be in future. Future Skills Scotland is intended to help caseworkers to be more informed about where future opportunities lie.
Thirdly, we need an attitudinal change in schools. That is why Nicol Stephen's leadership of the education for work agenda matters. There must be a clear ministerial lead on the value of the world of work in the education sector.
I have a final question on a hobby-horse of mine. The question was also asked in the convention. In the area that I represent, about 50 per cent of people are employed in the public sector. In most of our discussions, we see the public sector as a facilitator or catalyst but we do not pick up on the fact that the public sector is also an employer. That applies to a host of matters. I want to flag up that issue to see how it sits. In a way, when we consider the minister's enterprise remit, we tend to talk only about business. The Conservative party certainly wants to talk about business, but we must also accept the reality of people's employment. People are employed by the public sector, so we must be clear that the public sector is fully engaged as an employer and not only in relation to its statutory duties.
I agree. There are two issues. First, I hope that the committee will think a little more about how we shape the behaviours of employers. More is spent on lifelong learning for the private sector than for the public sector. If lifelong learning is to deliver the economic performance ambitions that Andrew Wilson mentioned, that must be dealt with.
Secondly, we must consider the paradox—perhaps the committee will consider this further—that, if we want to raise the overall productivity of the Scottish economy, we need to begin to raise productivity in the public sector. Doing that would probably make one of the most significant differences in Scotland's overall productivity rate. There is considerable evidence from other countries to show that that would be the case. You are right that public services are perhaps not the natural home for focusing on productivity. Perhaps on another occasion, the committee might want to think about whether that issue is appropriate to its remit or to the remit of another committee.
I will add one point to that. There is a major revolution going on within the national health service, which is one of the biggest public sector employers. The NHS is putting learning and continuous professional development at the heart of its agenda. Perhaps it might be helpful to the committee if we were to ask our health department colleagues to provide a couple of pages on what is happening there.
On that point, the two organisations that specialise in education and training for nursing and agriculture—the latter being the Scottish Agricultural College—have not submitted evidence to our inquiry. It would be useful to receive supplementary evidence from them.
I have written to the minister about ways of involving training providers for the NHS through return-to-practice schemes and the like. I could not let this event pass without acknowledging the work that has been done by Ann Rushforth of Scot Nursing to ensure that we can meet our ambitions for nursing places. If David Mundell wants to see an example of ways in which businesses are engaging with the NHS, I will be happy to take him to Scot Nursing in Bearsden.
With your leave, convener, I would like to park a question that relates to what we will be discussing under item 3. I was heartened by the commitment that was shown by the social partners who attended the convention to building interest in and the capacity of workplace learning. When we get to item 3, I would be interested in hearing more from the minister on the connections that could be made between the trade union learning fund and the ideas that we are outlining in relation to business learning accounts and the thorny issue of the future of individual investment in learning.
In conclusion, I want to make one point on the issue of celebrating Scottish success in making links between education and work. I note in passing that we have an outstanding articulation between all parts of our education system and our health needs, whether it be to do with training doctors, nurses or members of professions allied to medicine.
The needs of the health service are met outstandingly well by education in Scotland. However, the needs of some sectors, such as the financial services sector, are met badly by education. How come we meet the needs of the NHS extremely well at every level of our education system but do not meet the needs of other critical and well-established sectors of the Scottish economy? We have the capacity to meet those needs and we need to get better at doing so.
That might account for the fact that some people in financial services think that we have been in recession for 200 years.
The issue of the accountability and governance of further and higher education institutions might be perceived as being a gap in a report. The committee is concerned about that area but we felt that we had not taken enough evidence to allow us to do justice to it in our report. Do you share our concerns about that issue? You talked about the Scottish Executive's higher education review. Do you have in place any policies or strategies to tackle the concerns that we are flagging up?
The issue of the future of governance in further and higher education is touched on in the Executive's consultation document. As we are engaged in a consultation process, we have not taken a definitive position, but you are right to say that the matter should be on the agenda.
I share the committee's view that the time is not yet right for having a single funding body. Having spoken to the university principals, who are trying to drive forward the agenda of science and skills and compete globally, I know that they want to feel that their sector is given leadership and strategic direction without having further change at this stage.
My anxiety about the accountability agenda is that, if we merge funding bodies only up to level 8, accountability might be blurred as two funding bodies would operate in relation to higher education. The committee might want to reflect on that in coming months, but our higher education document will contain nothing that will pre-empt the committee's final view on the matter. We will also examine the issue of governance within individual institutions, in relation to which there are some encouraging moves such as the establishment of a voluntary scheme for appeals across Scottish universities.
Before we have a break, I want to raise the question of skills gaps. For example, it is reckoned that, over the next few years, the construction sector will need about 27,500 skilled and semi-skilled workers, 13,000 to replace those who are retiring and about 14,500 to meet the requirements of anticipated additional investment. Modern apprenticeships will clearly play a major role in bridging that skills gap.
I know that the answer to my first point comes down to whether one holds a dirigiste, directional view or supports incentives; it is also a matter of capacity. I realise that we are not as dirigiste when it comes to physics and other sciences because of the high level of investment and skills required, and perhaps the approach to that end of the market should be based more on incentivisation. However, if we do not solve the problem of the skills gap in the construction industry in the next few years, we will put at risk much of the expected investment and might also miss a big opportunity to make a huge input into growing the Scottish economy. As a result, our report suggests that more targets might be required. We do not want to be too prescriptive, but perhaps a percentage of modern apprenticeships should be geared towards solving the problems in the construction industry. What is your reaction to that suggestion, minister?
I think that it reaches the heart of the question from Annabel Goldie with which we started this discussion. Unlike England, we have kept modern apprenticeships at level 3. I told the STUC that the Scottish Labour movement had learned about dilution more than a hundred years ago. That has meant that for a person to receive an MA in Scotland they need a level 3 qualification. I cannot remember your final position on that point, convener, but I am predisposed to keep things that way in Scotland.
The challenge is, if we know where the gaps are, whether we should fill them to get the dividend from our investment in education or whether it is more important to have a universal entitlement that, at best, has deadweight or, at worst, has real losers. In a budget-neutral context, that is the critical issue that must be addressed over the next three months. Unlike the situation five years ago, we are now in a position to know where the gaps that need to be filled are. Our decision will be whether we fill those gaps or whether we redistribute resource around an entitlement that would have a percentage of deadweight. Let me leave the question there.
We will have a five-minute coffee break to give the minister a chance to have a breather. We have been joined by Phil Gallie, who will participate in the discussion on individual learning accounts.
Meeting suspended.
On resuming—