Chamber and committees

Yes, I can, if you will give me a moment. Progress has been made on it, because it is quite an important piece of work and was an important ask of the Withers review.

That work is under way. The initial stage of the project has included wide stakeholder engagement to inform and refine its scope, and we have identified data collection requirements and are working in partnership with relevant agencies and other stakeholders to ensure a solid evidence base. Data gathering is under way.

That initial stage, which I have just outlined, is due to be completed in the coming weeks, and it will be followed by data collation and analysis and further stakeholder engagement—and I mean meaningful engagement—in that space. There is no doubt that there is an appetite to tackle the issue, and it is imperative that we do so. James Withers was absolutely right about that.

Once we get through that, the final stage of the audit will focus on ensuring that insights are available to inform policy development, and advice on that will be coming to ministers. However, we absolutely recognise the need to move in this space and to get this knocked into shape, because we hear loud and clear the concerns of stakeholders.

I am more than happy to do so.

I will say, to be blunt, that I am not going to get dragged into trying to micromanage internal and cross-trade union relationships. We both know that that is what is at play here. I will do everything within my power and authority to encourage people, as best I can, to approach the process of resolving the long-standing issues in the sector, but I am not going to attempt to micromanage those issues.

That topic has come up at committee previously. An extensive effort has been made to tackle that thorny issue, which has dogged the college sector for the best part of a decade.

As a positive, I think that everybody who is involved recognises that continuing as they have is not, in any way, to be welcomed, to put it mildly. There is a commitment to try to move things on. We have made considerable progress on what that might look like, and we have progressed things to the point at which trade unions have been working in conjunction with the Advisory, Conciliation and Arbitration Service, and there has been a session on behaviours across the national bargaining process. That work is on-going.

Work has also been undertaken with College Employers Scotland to review the national recognition and procedure agreement and to consider how that could be strengthened to support improvements in national bargaining. However, two trade unions have served notice that they intend to resign from the current NRPA, as they no longer feel that it is fit for purpose, which leaves two unions that are aligned with it and two that are moving away from it. Unfortunately, we have an internal issue with the trade unions’ commitment to the processes. I would be deeply disappointed if we could not get into a better space. I still see that as an imperative, and the recognition is there from all parties.

Touch wood, things have quietened down in the sector. We have a long-term agreement with the lecturers and the employers, and I know that negotiations between support staff and employers have been on-going for some time. I am afraid that that is not much of an update, Mr Kidd, but that is where we are at.

On the topic of recovery—which is the word that is used rather than “clawback”, Mr Briggs—the SFC has done a lot of work on that with the college sector, particularly through the tripartite alignment group. That work has been extremely successful.

However, there is a point at which leaving public money that recirculates in the education system in institutions that have underperformed—I will come back to that point—cannot be justified without evidence that they are seeking not to underperform. There have been some instances in which that has been the case and some flexibility has been provided.

I am sure that the topic will be explored in greater detail in the tripartite group. There are limitations to what can be done, given the financial pressures that we are all aware of. Nevertheless, where universities are doing innovative things in the areas that you have referred to, and in others, there is an argument for a bit of understanding. I am sure that that will be explored further through the tripartite group.

Forgive me if I am being presumptuous, but I do not think that anyone in this room thinks that Withers was just an opinion—a point of view. It was an extensive piece of work that was carried out by a highly credible and respected individual. I do not know about other members but, at the end of my reading of the Withers report, I realised that I had sat nodding in agreement with pretty much everything. The work that I have done in the period since then, engaging with business and various stakeholders, has reinforced that.

To come back to your point, Mr Adam, about some of the evidence from SDS, the chief executive was, clearly, proud of the fact that 76 per cent of apprentices complete their apprenticeships, and I recognise that that is a better performance than elsewhere on these islands. However, I am not proud of the fact that almost one in four apprentices does not complete. I do not think that that is success. Some of the retention rates in a number of our colleges are not good enough. We have to aspire to do better.

There are lots of factors with regard to young people not completing college or apprenticeships. Often, those are outwith the control of those who are charged with delivering the programmes. Members of the committee know that the way in which we measure college retention is a bit unfair on the colleges. Nevertheless, we need to improve completion rates.

That is where the read-across to other areas of reform comes in. Getting that careers offering right is important because, at the moment, we have too many square pegs in round holes. That is what is happening in reality. It is one of the major contributory factors to the rate of lack of completion.

I do not want to focus entirely on SDS and apprenticeship delivery, because Withers set a challenge for everyone—and we have all been challenged, particularly Government. I have held up my hands and said that I think that his criticism is justified and that we can do better. We need to see that level of self-awareness across the landscape.

I was struck by something that the committee might be interested in. Construction is a remarkably important sector for the country and its economy. The Construction Industry Training Board tells me that around 18,000 young people go to college in Scotland every year to study construction but that only 15 per cent of those go on to work in construction. That is an example of some of the ideas that have arisen from the reform work and it challenges us to ask ourselves why that is the case and what lies behind it. If people are going to do courses, they should surely be ones that they are interested in and that will deliver to meet their needs and those of the economy. We must ensure that we have the workforce that we need, not for tomorrow but for now.

We must be honest with ourselves, because the numbers show that we are not getting it right and we must all ask what we should do to tackle that. I absolutely agree with Mr Rennie’s point about immediate challenges, but if we do not take the opportunity that Withers has presented to us and that the bill presents, and if we do not recognise the concerns that have been articulated, what will we do then? Are we saying that we are not going to respond to the places where we are coming up short? Are we going to let this slide because we are in challenging times and it is too difficult? That is not where I am. We must address some of the immediate challenges, but we absolutely must take a strategic view of the post-16 landscape and get to the point where the young people who are best suited to go to university are doing that—perhaps by doing graduate apprenticeships—and the young people who should be going into apprenticeships if that is the right thing for them are in the right apprenticeships. That is what the overarching reform is about.

I said earlier that we have strong foundations to build on. We do, and we should recognise that. Some of the very people who have established those strong foundations in apprenticeships will move across to the SFC. Thanks to Frank Mitchell, the SDS chairman, I have had direct conversations with those people and have set them two immediate challenges. The first is to look at what they would do differently if they were not working within their current framework and if we let them run free. That is a bit of an exaggeration, but you know what I am getting at. We asked what they would do differently.

The second challenge is a question about what impediments or perceived impediments there are to being able to deliver the vision that they believe would be better. We are awaiting feedback from them on that.

Some of what the OECD report suggested featured in Withers. There are elements that we have taken on board. However, we cannot sit back and say, “Well, the OECD said we are doing well, and we are doing better than England. That is good enough.” I do not think that it is. I do not think that a one-in-four dropout rate is good enough. I am not apportioning blame to anybody in particular in relation to that, but we should all aspire to better.

I will pick up on that point. I fully accept the financial challenges that universities have, for a wide range of reasons. A narrative has developed that suggests that financial sustainability is achieved only through the provision of more public money, but institutions also need to look at custom and practice issues in how they operate. I do not say that to deflect in any way; I just offer that observation.

There is an operating model, certainly in some of our universities, whereby, when a new market and a new source of income is identified, the university recruits quite heavily in order to deal with that. If that market and that source of income is subsequently diminished, for whatever reason, the same number of people face losing their jobs. We have seen that in a number of universities, where there have been significant job losses.

Some of that is down to how universities operate. Collectively, the UK and Scottish Governments need to look at the financing of our universities, and I take on board all the things that have been said in that regard. However, to be frank, it is also for universities to do some work on the way in which they go about their business. I think that they know that.

We have covered the point about what the bill does and does not do. At all times in my engagement with all the affected agencies’ staff, I have made the point that I want to hear their thoughts. I have heard directly from them on how engagement works currently and what could be done differently.

There has been a mixed bag of responses, and I accept that some people have expressed concern. Overwhelmingly, the feedback has been constructive and their point of view has been to say, “Well, you know what? We could have done this, or you might want to look at that.”

I will give an example of that, if I may. One of the things that exercises me is that I am not sure that the current apprenticeship offering entirely captures the needs of small and medium-sized enterprises, which are the lifeblood of this country. There are two conflicting statistics—forgive me if I get them the wrong way round—but SDS says that 92 per cent of its apprenticeships are with SMEs, but the Federation of Small Businesses says that 83 per cent of its members have never had an apprentice. That statistic troubles me. There is a disconnect there.

One of the issues for small businesses that was brought home in a series of pilots in 2015, I think, is the hassle for small businesses and the grief that they say they would face around human resources and training and so on. It all becomes too much for them to take on apprentices even when their business needs it for succession planning. It was actually a staff member who came to us and suggested a possible solution, and we are looking at that.

I absolutely accept that there will be concerns, as has been expressed to the committee. I have been open with the convener about what we will do in response to that. I have been as open as I possibly can be. I have met staff members at a session who then met me at something else and said, “I did not feel that I could raise the issue on the day, but I just wanted to say.” That has all been taken on board.

I absolutely share the concern that you are telling me that the committee has about it. I totally share it.

The reality here, from my perspective, is quite concerning. I will give the committee a couple of examples, because the evidence that you received certainly caught the interest of the college sector. I talked to a couple of colleges about this, and the numbers are really quite stark.

One college, for example, gets 48 per cent of the £8,700 that was referred to to the committee. However, it then draws down, over a three-year period, £16,000 of credits in order to deliver the training. Plumbing is a particularly intensive course; it can sometimes be one to three or even one to one, as it goes through.

Another college that I know of gets 46 per cent of the £9,500 that it is pulling down. In this instance, circa £5,000 of the money is retained, and college credits are utilised to deliver the training. I am really uncomfortable about that as a use of public money.

The managing agents will tell you that they do lots of good stuff, and CITB is doing some really good collaborative work with us. I do not have a black-and-white view of it. The English system is quite black and white—for example, it caps the amount of money that managing agents can retain.