Education and Training for the 21st century (1991)

This was the first of two education White Papers published by John Major's government in May 1991. It dealt with further education. (The second, which dealt with higher education, was Higher Education: A New Framework.)

The White Paper proposed that sixth-form and further education colleges should be removed from local authority control. This may be seen as part of the Conservative government's desire to reduce the power and influence of the local authorities - a process begun by John Major's predecessor, Margaret Thatcher.

The White Paper's proposals, and those of Higher Education: A New Framework, formed the basis of the 1992 Further and Higher Education Act

The White Paper was published in two volumes, both of which are presented in this single web page. You can scroll through it or use the following links to go to the various chapters:

Volume I

1 Aims (page 2)
2 Achievements (8)
3 Modern qualifications (16)
4 Equal status for academic and vocational education (24)
5 Working together (30)
6 Training credits (34)
7 Better careers advice (40)
8 Better motivation: higher achievement (46)
9 Better colleges (58)
10 Conclusion (64)

Volume Ii

1 The colleges (2)
2 Independence for colleges (4)
3 Education for adults (8)
4 The councils (12)
5 Status and governance of institutions (20)
6 Funding (26)
7 Assets and staffing (32)
8 Quality assurance (38)
9 Conclusion (42)

Note The presentation of this White Paper, printed in full colour on heavyweight paper, was clearly the result of someone in the DES being given one of the desktop publishing programs which were then appearing: it was full of pointless graphics, blank pages (which have been omitted here) and a layout in which some pages had very little content. I have not attempted to reproduce this: what you see here is just the text, though I have included the graphs and charts.

The text of Education and Training for the 21st century was prepared by Derek Gillard and uploaded on 9 May 2021.

White Paper: Education and Training for the 21st century (1991)

London: Her Majesty's Stationery Office 1991
Crown copyright material is reproduced with the permission of the Controller of HMSO and the Queen's Printer for Scotland.

Volume I


[title page]


Education and Training
for the 21st century

Presented to Parliament by the Secretaries of State for Education and Science,
Employment, and Wales by Command of Her Majesty
May 1991


Cm 1536 Volume I          11.00 net (2 volumes not sold separately)

(Reprinted incorporating corrections)

[page iii]


Over the last decade, there has been a revolution in Britain's education and training. The Government have introduced far reaching reforms and backed them up with increased resources. As a result, parents and their children now have choices and opportunities that simply did not exist for previous generations.

More and more of our young people are getting qualifications at 16. More are continuing in good quality education after 16. More are being trained - every 16 and 17 year old not in full-time education or a job is guaranteed a training place. More are getting A and AS levels. And many more are going on to get degrees at universities or polytechnics. That means that we are now building the skilled and motivated workforce we need to take on the international competition, and beat it.

This is good, but not good enough. The Government are therefore now launching a new wave of reforms which will give Britain's young people an even better start in life. With the introduction of a new Advanced Diploma, we will end the artificial divide between academic and vocational qualifications, so that young people can pursue the kind of education that best suits their needs. While A levels will remain the benchmark of academic excellence, we will raise the standard of vocational qualifications. We will improve the quality of careers advice and strengthen links between education and the world of work. We will give all young school leavers a training credit with which to buy the training of their choice. To help deliver this wider range of opportunities, we will be giving new freedoms to those responsible for our further education colleges and our sixth form colleges.

Our objective is simple: it is to encourage all our young people to develop to the best of their ability. We want to knock down barriers to opportunity. We want higher standards. We want more choice. In short, our aim is to give every one of Britain's young people the chance to make the most of his or her particular talents and to have the best possible start in life.

[page 1]


Chapter 1: AIMS2
Chapter 10: CONCLUSION64

[page 2]


1.1 This White Paper contains the Government's plans to improve and develop the education and training system for 16 to 19 year olds. It explains how we intend to meet the needs and aspirations of young people going into work towards the end of this century and in the early part of the next. It is also a response to the rising demand from employers for more and higher level skills to meet the growing challenge from overseas competitors in world markets. Our overall aims are:

  • to ensure that high-quality further education or training becomes the norm for all 16 and 17 year olds who can benefit from it;
  • to increase the all-round levels of attainment by young people; and
  • to increase the proportion of young people acquiring higher levels of skill and expertise.
1.2 The quality and scale of education and training for young people have improved dramatically over the last ten years. Chapter 2 describes the progress we have made. But there is further to go. There are still young people leaving school without the motivation to continue learning. We want to offer them better incentives and opportunities. And vocational qualifications and colleges of further education are still undervalued. We want to see full equality of status between them and their academic counterparts. They must make their full contribution to the attainment by young people of the skills and qualifications they will need for their future careers.

1.3 Over the last six months, the Department of Education and Science, the Department of Employment and the Welsh Office have carried out a top-level, comprehensive review of education and training for young people. Our objective has been to identify ways of strengthening and extending existing Government initiatives and remedying any deficiencies which remain. In particular, we have looked at ways of providing incentives for more young people to participate in vocational education and training to a higher level, of strengthening the colleges that provide much of it, and of improving the links between employers and education. This White Paper sets out the results.

[page 3]

1.4 The school reforms introduced under the Education Reform Act are already strengthening the education system for pupils up to the age of 16. Youth Training has been transformed. We plan to build on these reforms, so that a fully-integrated system of education and training exists which allows steady progression from school through to further and higher education, and to training in work. Our policies will promote continuous learning from the age of 5 through education and throughout working life.

1.5 Our overall aims of engaging more young people in education and training, and raising their attainment, require improvement throughout the system. We will:

  • establish a framework of vocational qualifications that are widely recognised and used, and that are relevant to the needs of the economy;
  • promote equal esteem for academic and vocational qualifications, and clearer and more accessible paths between them;
  • extend the range of services offered by school sixth forms and colleges, so that young people face fewer restrictions about what education or training they choose and where they take it up;
  • give Training and Enterprise Councils more scope to promote employer influence in education, and mutual support between employers and education;
  • stimulate more young people to train, through the offer of a training credit;
  • promote links between schools and employers, to ensure that pupils gain a good understanding of the world of work before they leave school;
  • ensure that all young people get better information and guidance about the choices available to them at 16 and as they progress through further education and training;
  • provide opportunities and incentives for young people to reach higher levels of attainment;
  • give colleges more freedom to expand their provision and respond more flexibly to the demands of their customers.
1.6 These new policies are set out in detail in Chapters 3 to 9. The summary boxes at the end of each chapter describe the key proposals. Our plans for establishing a new college sector for post-16 education and training, described

[page 4]

briefly in Chapter 9, are set out more fully in the second volume of this White Paper: The Challenge to Colleges.

1.7 We realise that these proposals are ambitious. They require a major cultural change in our attitudes towards further education and training. But this change is already under way, and the potential rewards are clear. Successful implementation of the new policies will require concerted action on the part of the Government, employers, education and training institutions and, crucially, young people themselves. This White Paper expresses our commitment to that action.

1.8 The Secretary of State for Scotland will issue a White Paper setting out his policies for Scotland.

[page 5]

  • National Vocational Qualifications will be introduced as fast as possible, with more general NVQs for young people. A level and AS syllabuses will be strengthened (Chapter 3).
  • New Diplomas will be developed, recording achievement in academic and vocational qualifications. Schools will be allowed to admit part-time and adult students to their sixth forms (Chapter 4).
  • We will extend employer influence in the education system through Training and Enterprise Councils (Chapter 5).
  • We aim to offer every 16 and 17 year old leaving full-time education a training credit within the lifetime of the next Parliament (Chapter 6).
  • We will strengthen careers advice and vocational work in schools, and legislate to allow a variety of local options about how the Careers Service is run (Chapter 7).
  • Levels of attainment will be raised by:
    • ensuring that all pupils aged 16 stay to the end of the summer term;
    • a nationwide extension of the Compacts approach;
    • increasing achievement of higher level vocational qualifications;
    • providing more places in higher education for the increasing numbers who can benefit from them (Chapter 8).
  • We will legislate to give further education and sixth form colleges independence to expand and respond to their markets (Chapter 9).

[page 6]


2.1 The last decade has seen many improvements in education and training for young people in the transition from school to work. The aims of Government policy have been to strengthen the educational foundations laid at school, to improve the quality of learning and its relevance to work, and to increase opportunity for young people to train and continue education after 16.

More young people in education and training

2.2 The 1980s saw a considerable rise in the proportion of young people taking part in education and training. In England, between 1981 and 1989 the proportion of 16 year olds in education and training rose from 74 per cent to 86 per cent (1). Over the same period the proportion of 17 year olds in education and training rose from 53 per cent to 70 per cent. There have been significant increases both in full-time education and in training.

Higher achievement

2.3 The last decade has also seen a substantial increase in the number of young people obtaining qualifications. The increase in numbers obtaining higher level qualifications has been especially marked;

  • a higher proportion of young people are achieving A level and AS qualifications;
  • more young people are gaining qualifications through Youth Training;
  • more young people are going on to obtain degrees.
(1) Statistics throughout this White Paper are for England and Wales, unless otherwise stated.

[page 9]

A stronger education base

2.4 The National Curriculum is already setting new and higher standards in schools, and raising expectations of what pupils at all levels can achieve. All pupils will have a broad and balanced curriculum from the age of 5 up to 16. They will be taught the essential skills and knowledge for their age and level of ability, and will be encouraged to develop enquiring and flexible minds. Through the National Curriculum, pupils will have many more challenges and achievements during their time at school. Many more now want to continue beyond 16.

2.5 The Technical and Vocational Education Initiative (TVEI) has complemented the National Curriculum by helping to equip young people aged 14 to 18 for the demands of working life by:

  • providing them with the understanding and skills which employers need;
  • giving valuable work experience;
  • developing enterprise, initiative and personal capability.

[page 10]

2.6 The introduction of GCSE has broadened the scope of examination syllabuses and enabled pupils to demonstrate the full range of their abilities. The level of attainment at 16 and the numbers continuing with education or training after 16 have both risen since GCSE was introduced. There will be further improvements as GCSE is aligned with the new and challenging targets of the National Curriculum.

2.7 Compacts, which have been successfully introduced in Urban Programme Authority areas in England and priority areas in Wales, have resulted in many young people working to goals - such as improved attendance and higher attainment - agreed between themselves, employers and their schools or colleges. In return, they are guaranteed a job with training, or training leading to a job. Since the launch of the Compacts initiative in March 1988, the number of Compacts in Great Britain has increased steadily and the network now covers:

  • over 92,000 young people;
  • nearly 500 schools and colleges;
  • around 9,000 employers guaranteeing over 25,000 jobs.
2.8 The Careers Service is the major source of informed and impartial careers advice and guidance to students. The Service gives individual guidance interviews to over 1 million students each year. The Service also plays a major part in helping young people into jobs or Youth Training, placing around 70,000 into jobs each year and 150,000 into Youth Training.

[page 11]

Better initial training

2.9 Over 3 million Youth Training opportunities have been taken up by 16 and 17 year olds in Great Britain since 1983. This has added substantially to the amount of high-quality training for young people, while the proportion of young people in apprenticeships has been maintained.

Youth Training offers:

  • a guarantee of training to all 16 and 17 year olds outside full-time education or employment;
  • individually planned training;
  • the first step on a ladder of opportunity within a framework of qualifications: 82 per cent of all who leave training in Great Britain go into jobs or further education;
  • training for real jobs: an important motivation to continue learning;
  • an opportunity to reach NVQ Level 2 or higher.

[page 12]

2.10 Youth Training has brought systematic training to many sectors where little existed before, including the growing service industries. It has provided a stimulus to employers to provide their own training, and to colleges to meet employers' needs.

A revolution in learning

2.11 New techniques of learning are increasingly being used to allow people to acquire skills in ways that suit their individual needs. They can increasingly use open and flexible learning - techniques in which Britain leads the world - to learn at a pace and place that suits them. They can increasingly use individual action plans to map out their personal programme of development. They can measure their achievement against standards, not just time served, and keep their own record of achievement. They can develop their personal effectiveness, alongside their knowledge and skills.

2.12 These developments have required radical changes to the way the training and education system works. Institutions have become more customer orientated. They have had to organise more open access, geared to the individual's needs. Business needs have been brought to the fore in schools and colleges.

An open market in education and training

2.13 The Government has delegated decision taking to the local level, making schools and colleges more accountable to those who use them. The Education Reform Act gave governing bodies and senior staff of schools and colleges extensive control over finance, staffing and course provision, and freedom to manage according to local circumstances and demands from their customers. The recent restructuring of governing bodies, to make them more representative, has also made institutions more aware of how to improve their services on the basis

[page 13]

of real needs. Schemes of delegated management are already in place in most further education colleges. Most secondary schools now exercise delegated management; such arrangements will extend to all schools, primary and secondary, by April 1994 at the latest.

Employer involvement

2.14 Employer involvement in education and training is being secured through local Training and Enterprise Councils (TECs). We have now, for the first time, given leadership of training to top business people and other key local people and the power and resources to apply local solutions to local needs. Since its launch in 1989 there has been overwhelming support from business for the TEC initiative. The network of 82 TECs, and 22 Local Enterprise Companies (LECs) in Scotland, is in place and will be fully operational nationwide later this year.

2.15 Since 1986 the Employment Department has had responsibility for part-funding work related further education (WRFE) delivered through public sector colleges of further education. To receive a block grant, local education authorities (LEAs) have agreed strategic plans for WRFE provision in their area. Responsibility for the programme was devolved to TEes from April 1991. Through this and other initiatives, further education is now:

  • much more responsive to individual and employer needs;
  • marketing itself much more effectively;
  • devising courses to meet specific employer needs;
  • serving the customer better by offering more flexibility in the method of delivery.
Finishing the task

2.16 The education and training system has improved substantially over the last decade. But there is more to be done to allow young people to develop their skills and talents to the full. The next few years offer an opportunity to complete the task. Employers are more committed to raising skill levels than ever before. Young people are better motivated to develop their capabilities for work. The opportunity now exists to build on past achievements.

[page 16]


3.1 Young people and adults need a clear framework of qualifications to measure their success in education and training. We need to build up a modern system of academic and vocational qualifications which are equally valued. They must both set a high standard and offer ladders of opportunity after 16 and throughout working life, building on achievements at school. Much work has already been done to reform vocational qualifications and to create a framework within which they can be located, so that they are easy to understand and their relationship to further education and training opportunities is clear. The need now is to build on that work.

National Vocational Qualifications - NVQs

3.2 Vocational qualifications in this country have been undervalued and underused. A major reform is under way to produce clear, nationally recognised qualifications. The reform is led by the National Council for Vocational Qualifications (NCVQ).

3.3 The new NVQs are:

  • based on up-to-date standards, set by employers, which define the knowledge and skills that people need in the workplace;
  • a guarantee of competence to do the job, not just in theory but in practice, and of the skills that are needed for modern work;
  • recognised throughout the United Kingdom;
  • in a framework of levels, which allows people to plan their career paths and to see a clear ladder of progress to higher qualifications;
  • modular, so that skills and knowledge, common to many jobs, can be recognised, however they have been acquired; and so that people can build up qualifications as they progress and transfer skills from job to job;
  • free of artificial requirements about the pace, place or method of learning;
  • for all ages, from school right through to the end of a career.

[page 17]

Definitions of NVQ levels

The definitions refer to occupation specific NVQs and provide a general guide. They may need to be extended to include more general NVQs

Level 5: competence which involves the application of a significant range of fundamental principles and complex techniques across a wide and often unpredictable variety of contexts. Very substantial personal autonomy and often significant responsibility for the work of others and for the allocation of substantial resources feature strongly, as do personal accountabilities for analysis and diagnosis, design, planning, execution and evaluation.

Level 4: competence in a broad range of complex technical or professional work activities performed in a wide variety of contexts and with a substantial degree of personal responsibility and autonomy. Responsibility for the work of others and the allocation of resources is often present.

Level 3: competence in a broad range of varied work activities in a wide variety of contexts most of which are complex and non-routine. There is considerable responsibility and autonomy, and control and guidance of others is often required.

Level 2: competence in a significant range of varied work activities performed in a variety of contexts. Some of the activities are complex or non-routine, and there is some individual responsibility or autonomy. Collaboration with others, perhaps through membership of a work group or team, may often be a requirement.

Level 1: competence in the performance of a range of varied work activities, most of which may be routine and predictable.

3.4 The Government has instructed the National Council to have a comprehensive framework of NVQs in place by the end of 1992. These will cover 80 per cent of the working population at Levels 1 to 4 in the NVQ framework, and all the major sectors of employment.

3.5 Once that aim has been achieved, we must secure permanent arrangements to keep NVQs up to date, and to develop them for the remaining 20 per cent of employment, including professional levels. These arrangements will entail effective collaboration between employers setting standards, industry training organisations and professional bodies. They must be capable of developing and reviewing standards and qualifications at every level and for every occupational group.

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General qualifications within the NVQ framework

3.6 Many young people want to keep their career options open. They want to study for vocational qualifications which prepare them for a range of related occupations but do not limit their choices too early. Some want to keep open the possibility of moving on to higher education. Employers, too, want to have the opportunity of developing their young recruits' general skills, as well as their specific working skills. A range of general qualifications is needed within the NVQ framework to meet these needs. Some already exist which help to meet this need - including some offered by the Business & Technician Education Council (BTEC). But they need to be clearly related to the NVQ framework, to make it easier for people to progress quickly to occupationally specific qualifications.

3.7 The Government sees the development of more general NVQs as an important priority. It believes that the NCVQ as a matter of urgency should work with others, including awarding bodies, industry lead bodies and the Further Education Unit, to develop criteria for accrediting more general vocational qualifications. A detailed remit letter will be given to the NCVQ shortly.

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3.8 General NVQs should cover broad occupational areas, and offer opportunities to develop the relevant knowledge and understanding, and to gain an appreciation of how to apply them at work. General NVQs should also:

  • offer a broad preparation for employment as well as an accepted route to higher level qualifications, including higher education;
  • require the demonstration of a range of skills and the application of knowledge and understanding relevant to the related occupations;
  • be of equal standing with academic qualifications at the same level;
  • be clearly related to the occupationally specific NVQs, so that young people can progress quickly and effectively from one to the other;
  • be sufficiently distinctive from occupationally specific NVQs to ensure that there is no confusion between the two;
  • be suitable for use by full-time students in colleges, and, if appropriate in schools, who have limited opportunities to demonstrate competence in the workplace.
Faster introduction of NVQs

3.9 NVQs will be substantially available by the end of 1992. The Government wants them used as soon as possible. Section 24 of the Education Reform Act allows the Secretaries of State for Education and Science and for Wales to make an Order to extend to 16 to 18 year olds the provisions of Section 5 of the Act, already used for the approval of qualifications and syllabuses for pupils under 16 in schools.

3.10 The Secretaries of State intend to use these reserve powers to regulate all full-time provision offered to senior pupils over the age of 16 and to full-time students in further education colleges. This will be a means of requiring colleges and schools to offer only NVQs to students pursuing vocational options. It would also have the effect of controlling the provision of all other qualifications, including A level and AS syllabuses and examinations. In particular, this will encourage colleges and awarding bodies to replace older style vocational qualifications with NVQs as soon as possible. The Secretaries of State will consult soon on the procedures necessary to give effect to Section 24.

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Broader choice in academic qualifications

3.11 The Government is committed to maintaining A levels and the standards they represent, and strongly welcomes the increases in the number and proportion of young people studying for them. However the specialised study of two or three subjects, often closely related to each other is for many students too narrow a preparation for the next stage of study or for work. We have, therefore, introduced Advanced Supplementary (AS) examinations, which offer what amounts to half-subjects at the same standard as A level and enable students to spread their study across a broader range of subjects. The Government looks to higher education admissions tutors and to employers to give higher significance to AS results. We will continue to encourage the take-up of AS. We will also seek to encourage breadth in other ways, including the development and take-up of other courses not at advanced level, which enable young people to continue their study of, for example, modern languages and information technology.

3.12 A level and AS syllabuses need to evolve. But they must do so without undermining the consistency of high standards. That means establishing a framework of principles designed to ensure the quality of all A and AS syllabuses. As announced in paragraph 3.10 above, the Government will be consulting on its intention to activate Section 24 of the Education Reform Act to control the provision of qualifications and syllabuses for pupils and students aged 16 to 18.

3.13 The Government has now responded to advice from the School Examinations and Assessment Council (SEAC), setting out the basis on which principles can best be developed. The Government's response offers the prospect of a sound basis for controlling the evolution of A level and AS syllabuses. It will also help to clarify the relationship between A level and AS in terms of subject content.

3.14 The Government's intention is that the principles should provide a clear framework to control syllabuses from September 1994. The new principles will ensure that candidates themselves, employers, higher education admissions tutors and the community at large know what a given A level or AS

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means, in terms of what the holder knows, understands and can do. In particular, the principles will ensure consistent high standards and provide a clear framework to control the development of innovations. They will regulate the amount of coursework assessment within syllabuses. The Government intends that an examination at the end of the course will remain the norm, and that for most subjects a firm maximum of 20 per cent will be set for any coursework element. The principles will also control and regulate syllabuses based on modular structures to ensure their coherence and comparability with the standards of other syllabuses.

3.15 Schools and colleges will have the choice of a wider range of approaches, offering the possibility of links with vocational qualifications where appropriate, without loss of standards or rigour. The Government believes that its prime objectives - to increase participation and to improve standards - will be secured effectively without the need for radical change to a highly regarded, tried and tested examination system.


A comprehensive framework of National Vocational Qualifications will be in place as soon as possible.

The Government will use its powers to speed up their introduction in further education.

The National Council for Vocational Qualifications will be invited to work with industry lead bodies and awarding bodies, to develop a range of general NVQs within the NVQ framework.

AS qualifications will be promoted.

A level and AS syllabuses will be strengthened to reflect developments in pre-16 education and changing requirements.

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4.1 Young people should be free at 16 to choose the education or training options which suit them best. They should not be limited by out-of-date distinctions between qualifications or institutions.

4.2 The Government wants to remove the remaining barriers to equal status between the so-called academic and vocational routes. We want academic and vocational qualifications to be held in equal esteem. Vocational qualifications are appropriate for many more young people than currently take them, but too few are prepared to look at the alternatives to A levels. Some structural differences between further education colleges, sixth form colleges and school sixth forms are also unnecessary, and get in the way of students making the best choice for them.

Equal esteem for qualifications

4.3 Academic and vocational qualifications deserve equal recognition. All young people need to be aware of the opportunities offered by vocational qualifications. The Government believes that young people should be encouraged to choose a blend of qualifications to suit their individual needs and talents. After 16 they should have a free choice between A level, AS qualifications, NVQs and combinations of them.

4.4 In order to meet these objectives, the Government intends to establish a new system of Ordinary and Advanced Diplomas. We will consult widely on this proposal. The Ordinary Diploma might be awarded to those gaining four or five GCSEs at National Curriculum levels 7 to 10, equivalent vocational qualifications, or any combination of these. The Advanced Diploma might be awarded to those gaining two A levels at grades C or above, an equivalent combination of A and AS, equivalent vocational qualifications, or a combination of A level, AS and vocational qualifications.

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4.5 The progressive accreditation of vocational qualifications by the NCVQ will provide a basis for specifying the qualifications and combinations of qualifications which will comprise the Advanced Diploma. As general NVQs come on stream, the breadth that it is envisaged they will offer should provide a particularly sound basis for award of the Advanced Diploma.

4.6 The Advanced Diploma would demand a level of achievement which offers a passport to most degree courses and jobs requiring a similar level of ability; would clarify and enhance current channels for progression and would offer an additional incentive to participate in education beyond the age of 16.

4.7 This system of Advanced and Ordinary Diplomas would give a real and substantial incentive to students of all ages and in all institutions to pursue their studies to the maximum of their ability. The Government will look to higher education and employers (along with its advisory bodies) to play an active part in developing and then promoting the use of this new system. The Government intends over the next few months to elicit views on the composition and scope of these Diplomas with a view to introducing them at the earliest practicable date.

Common standards for schools and colleges

4.8 Choice between the academic and vocational routes is confused by the institutional divide between further education colleges and sixth forms. Some of these differences are historical. We intend to remove those which are no longer justified.

4.9 This does not threaten centres of proven excellence. The best sixth forms offer an education of high quality which provides a foundation for entry to higher education and for the acquisition of professional skills. The Government will ensure that these opportunities continue to exist. The Secretaries of State for

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Education and Science and for Wales will not approve proposals for the closure of a school sixth form unless they are convinced that alternative arrangements will provide education of the same quality and variety.

4.10 The Government wants more maintained schools to offer vocational qualifications to the 16 to 19 age group. Very few vocational qualifications are currently available in sixth forms. The main exception is the Certificate of Pre- Vocational Education (CPVE), a broad vocational qualification which is available in about 60 per cent of sixth forms, and which is taken by around 22,000 pupils in England each year. The Government has given City and Guilds responsibility for the CPVE, with a remit to give it more rigour and to ensure that it offers a suitable route through to higher level qualifications. We are also allowing schools, for the first time, to offer Business & Technician Education Council (BTEC) First diplomas to students aged 16 to 19 from September 1991. BTEC Firsts provide a good general education, sound preparation for work and opportunities for progression to higher level qualifications.

4.11 Schools are already under a duty to publish their examination results and will soon be required to publish a summary in a standard format that can be easily understood. Further education colleges should also publish their results, and in a similar format, so that the two can be compared. Initially, this will be a voluntary arrangement, but formal regulations will be introduced in due course. Young people, parents, employers and the schools and colleges themselves, will then be able to make more informed judgements about the quality of their provision, overall and in individual courses.

Widening the field of choice

4.12 The Government also intends to allow schools to admit part-time and adult students into their sixth forms, and to charge fees or accept training credits for them. This will give schools more revenue, and will enable them to use their resources more efficiently. For example, schools will be able to admit adult

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students to empty places in sixth form classes and to use existing accommodation for part-time day and evening courses. The new courses they will offer under these arrangements may also provide new opportunities for full-time pupils. The new arrangements should also help younger pupils to become accustomed to the idea that education is not just for children.

4.13 With the removal of unnecessary restrictions on where courses are provided and to whom, more young people and adults can be expected to take advantage of education and training since suitable courses will be more conveniently placed in a wider range of institutions.

4.14 In Youth Training, new approaches are being pioneered to create flexible links between education and training. Young people can choose to pursue mixed programmes of learning which combine academic, vocational and personal development with experience of working life. There is growing experience of how to support young people pursuing such programmes, through good careers education, individual action planning, and support from mentors. The Training and Enterprise Councils are showing considerable interest in these approaches, and we shall encourage their further development.


A new Diploma recording achievement in academic and vocational qualifications will be developed.

Good quality sixth forms will be supported.

Schools will be encouraged to offer more vocational qualifications.

Schools and colleges will publish examination results.

Schools will be allowed to admit part-time students and adult students, and to charge fees for them.

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5.1 Employer commitment is central to the Government's policy for vocational education and training. The Youth Training Scheme, from 1983, engaged thousands of employers for the first time in offering training and work experience for large numbers of school-leavers - not just those they intended to employ. That scheme has evolved into Youth Training, with a much greater emphasis on the provision of training for young people in jobs. Through the Technical and Vocational Education Initiative many employers have come - often for the first time - to work with their local schools. Education-Business Partnerships are providing a further opportunity for such co-operation. Outside Government, too, the 1980s saw the rise of many initiatives, national and local, designed to bring employers and education more closely together.

5.2 The Government has done much to give employers more influence in the education system. We have legislated to ensure that there is effective employer representation on the governing bodies of maintained schools and of colleges of further education. At least half the members of polytechnic and college governing bodies, and a third of the members of school governing bodies, now represent the interests of local employers or professional groups.

5.3 Just over two years ago, the Government announced its intention to put business in the lead locally by setting up Training and Enterprise Councils. We have given TECs, from the outset, important responsibilities for the vocational training of young people, and given them influence in key areas of education. Last autumn the Government announced that TECs would have an important voice in the extension of the Technical and

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Vocational Education Initiative, and in decisions about the provision of work related further education in local colleges. These important new responsibilities for TECs will increase their ability to take a strategic view of skill needs in their areas, and to secure coherence in vocational education and training provision.

5.4 There is now a wealth of experience to demonstrate that close working relationships between employers and schools and colleges can lead to mutual benefit. Employers need well qualified young recruits with a strong educational foundation on which to build working skills throughout life: they get a better understanding of the teaching methods and objectives in schools and colleges, and of how our reforms are working in practice. Schools and colleges need to be responsive to the needs of employers and young people: they get better information about jobs and labour market trends. We are confident that effective co-operation will ensure success for the proposals in this White Paper for developing training credits, Compacts and the Careers Service, and for strengthening employer involvement in the management of further education.


The influence of employers on the education system will be extended through Training and Enterprise Councils.

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6.1 A central aim of our policies is to unlock the potential of many more young school-leavers through training to recognised standards. Motivating these young people and getting their employers to value training is an urgent national priority.

Youth Training

6.2 Youth Training has had great success in offering well-planned training to young people, many of whom would otherwise have opted for low-skill jobs without prospects. Youth Training is a key component in our strategy for enabling more young people to train and to qualify, and to encourage employers to take more responsibility for the training of young people.

6.3 By the autumn, Youth Training will be directed entirely by the TECs and LECs. We have given them considerable flexibility to ensure that their training provision for young people is geared to the needs of individuals and of the local community, and offers real incentives to encourage young people to achieve qualifications.


6.4 We believe that Youth Training can be made even more effective through the use of training credits. A training credit is a voucher showing a money value, typically at least 1 ,000, put in the hands of young people leaving full-time education at 16 or 17. It entitles them to vocational education and training, and buys them the opportunity to qualify with a National Vocational Qualification at NVQ Level 2 (or its equivalent) or higher.

6.5 Credits operate within the Youth Training framework. So a young person with a credit will be given a training plan. The training will generally

[page 35]

be at NVQ Level 2 or higher, and its quality will be approved by the TEC; it is intended to be additional to what an employer would otherwise have provided. Young people without jobs will continue to be guaranteed an offer of a training place, and the appropriate minimum training allowance. TECs and LECs will be required to make suitable provision for young people who have special training needs as a result of disability or other disadvantage.

6.6 Credits differ from Youth Training, however, in some important ways. In particular, public funding is routed through the individual young person rather than through a training provider. This aims:

  • to increase young people's motivation to train, by giving them choice and control, and making obvious to them the scale of investment available to support their training;
  • to enhance the market in training provision. Providers will be paid according to their ability to attract trainees holding credits;
  • to enhance employer involvement. Where a young person with a credit is in a job, the employer can agree to organise the training.
In addition, credits highlight the importance of enhancing careers guidance to help young people achieve a smooth transition from full-time education into the world of work, and to make the best use of their credit.

6.7 From April this year 10 TECs and 1 LEC have been piloting training credits. These pilots are making credits available to about 10 per cent nationally of 16 and 17 year olds who have left full-time education. The TECs and the LEC which are running the pilots have developed, in conjunction with their LEA partners, a range of exciting and innovative approaches. Two offer credits to young people training in priority sectors. In the other pilots, all young people

[page 36]

leaving full-time education at 16 or 17 are eligible to receive a credit. The credit may have a local name and may look like a cheque book, a credit card or a bond. All are designed to attract more young people into high-quality training and to give them wider choices. They have the potential to raise significantly young people's expectations and determination to find and make the fullest use of training opportunities available to them.

Credits for all school leavers

6.8 We intend to extend training credits to all 16 and 17 year olds who leave full-time education. The eleven pilots have attracted enthusiastic support from employers, young people, trainers and teachers. Many other TECs and LECs have expressed their desire to join in. We will use the momentum behind

[page 37]

credits to extend them progressively, building on the experience of the pilots as they are evaluated.

6.9 We will extend credits progressively, year by year. Our aim is that, in 1996, within the lifetime of the next Parliament, every 16 and 17 year old leaving full-time education will have the offer of a training credit.

6.10 In the first instance, TEes and LECs will be invited to submit proposals for local schemes offering training credits in their localities, to come into operation in April 1993. From their bids, we plan to select schemes to cover another 10 per cent of the national total of 16 and 17 year olds leaving full-time education.

6.11 Credits have enormous potential to bring young people who have left full-time education into training and vocational education. They have the potential to reach those who up to now have missed out on achieving at school and at work. They enable individuals to enhance their skills and opportunities for career development; they offer more employers the means to develop their young recruits. We expect them to have a major impact, both on the extent that training opportunities are taken up, and on the attainment of skills.

6.12 The commitment of young people and their employers to training needs to be secured by voluntary means. Compulsion on employers or young people is unnecessary. Other major industrial countries achieve high levels of skill without compulsion. Employers in Britain are raising their investment in skills without being forced to do so; they regard past attempts at statutory intervention in private sector training as a failure not to be repeated. The effects of compulsion would be damaging. Young people would be forced to follow routes they had not chosen. Employers would be burdened with bureaucratic requirements. Small firms would be particularly hampered. There would be far fewer jobs for young people. Our voluntary approach of offering incentives to

[page 38]

young people to train through credits will raise skill levels without the damaging consequences of compulsion.


The Government aims to offer every 16 and 17 year old leaving full-time education a training credit within the lifetime of the next Parliament.

[page 40]


7.1 The Government aims to engage many more young people in training and further education, and to encourage them to aim for higher levels of achievement. To make the right choices about training, further education and future careers, young people need the best information and advice that can be given. And they need to build up their understanding of working life while at school.

Looking ahead to the world of work

7.2 Young people need to learn, while at school, what work entails and to get some experience of it. The National Curriculum provides the foundation. A broad and balanced curriculum will soon be available for all pupils from 5 to 16. It will include opportunities for pupils of all ages to see how what they are learning can relate to their future working lives. And their understanding can be enhanced by activities such as work experience, observation and shadowing. The Technical and Vocational Education Initiative (TVEI) has introduced teaching approaches for many 14 to 18 year olds which reflect employers' requirements. The Government has also recently announced plans for broadening choice in the curriculum for 14 to 16 year olds. We are encouraging vocational awarding bodies to develop a new range of examination courses for subjects inside and outside the National Curriculum, or combinations of them. This will give all pupils the chance to obtain qualifications which relate directly to their chosen education, training and career paths beyond 16.

7.3 Full integration of these measures with schools' careers education and guidance work will give pupils a firm basis for assessing their own interests and aptitudes. They then need full, impartial and up-to-date information about further education, training and career options and prospects so as to make realistic and positive choices.

7.4 LEAs must have policies on careers education and guidance for all16 to 19 year olds in full-time education. More and more colleges are developing

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their own policies for delivering guidance effectively, increasingly covering higher education as well as vocational options. These developments need to continue.

The Careers Service

7.5 Independent careers advice is provided by the Careers Service.

It already plays a major part in helping young people into education and training. Our plans in this White Paper for opening up more opportunities for young people will increase its importance.

7.6 The Careers Service now needs:

  • to raise the overall quality of its services. High standards of service should be available everywhere;

[page 42]

  • to draw even closer to employers;
  • to be part of the new efforts led by the Training and Enterprise Councils to build up employer commitment to training;
  • to encourage more young people to take up education and training opportunities and aim for higher qualifications.
7.7 These new goals require a new way of organising the Careers Service, particularly if closer co-operation with employers is to be secured. The Government has been consulting LEAs, who are currently responsible for the Service, and TECs about ways of organising it in future. The consultation has shown that there is considerable and welcome interest in many areas in finding means for LEAs and TECs to join in the management of the Service.

7.8 As the law currently stands, LEAs are statutorily responsible for providing a Careers Service, and for operating it through their own staff. It is open to an LEA to join voluntarily with a TEC as partner in overseeing the operation of the Service in its area. We know that some LEAs and TECs are keen to work together in this way, and we wish to encourage it. Some pump-priming funding will be made available, through TECs, where such partnerships are proposed.

7.9 The Government wishes to see LEAs and TECs developing together other ways of working, reflecting local needs. The present legislative framework prevents this. We propose therefore to legislate so as to open up a range of other options, including direct TEC management of the Careers Service. In addition, we will enable LEAs, where they remain responsible for the Careers Service, to contract it out to the private sector through competitive tendering if they wish. Some authorities already see this as a way of improving the efficient management and quality of the Service, but at present they are debarred by law from contracting out the Service. We propose also to take reserve powers to require LEAs to put their Careers Service out to tender, if experience shows this to be a good way of managing the Service. This proposal is consistent with the Government's wider policy of contracting out more local government services.

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7.10 It follows that the Careers Service may come to be run in rather different ways in different places. This will reflect local needs. We shall ensure through standard setting that, however provision is organised, high quality will be safeguarded everywhere.

Careers information

7.11 Good information is the foundation of any programme of careers advice. Every school and college needs to be able to offer its students access to materials aimed at helping them decide which careers options to pursue, what qualifications will be required and how to set about entering the occupation of their choice.

7.12 The Government intends to provide additional resources to equip secondary schools and colleges with up-to-date libraries and computerised information. Each secondary school and college will be able to have a microcomputer on which it will be able to run careers information packages such as MicroDOORS or ECCTIS. Resources will also be provided to supplement schools' own budgets on a continuing basis, so that computerised information is kept up to date. These new grants will be provided on a matching-funding basis, and will be conditional on schools providing adequate facilities for a careers library, maintaining materials in good order and continuing to fund a basic level of provision from their own resources. The Careers Service will be asked to ensure that careers libraries meet these standards. We shall invest, also, in improving inservice training for the advisory staff of the Careers Service.

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The school curriculum for young people aged 14 to 16 will be made more relevant to their further education, training and career options and choices.

The Careers Service will be brought closer to employers. We will encourage LEAs to join with TECs as partners. We will legislate to open up a range of further options for managing the Service, including direct TEC management and contracting out.

The Government will invest more in careers advice.

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8.1 The Government's plans are aimed at increasing all-round levels of attainment by young people, and at increasing the proportion reaching higher levels of qualification. These goals will meet the growing need of employers for people with a strong foundation of learning and with high technical skills. We must provide the opportunities for young people to qualify and to aim high.

Qualifying at 16

8.2 The Government intends to introduce a single school-leaving date at the end of the summer term. This means that pupils who reach 16 between 1 September (of the previous year) and 31 January would no longer be able to leave at the following Easter, and the present summer leaving date at the end of May would be moved to the end of the summer term. A substantial number of pupils miss out on the opportunity to obtain qualifications during that crucial summer term, and many leave school with no qualifications at 16 plus: a waste for them and a waste for the country. We want them to stay on to the end of the summer term, to complete their studies under the National Curriculum and to have their achievements assessed.

8.3 Young people who leave school at the earliest possible time are often disillusioned with education. If an increasing number are to continue to participate in education and training beyond 16, the content has to engage their interest and motivate them. We have recently introduced a framework for flexible learning in schools and colleges, where the emphasis is more on learning than on teaching. This process has been developed from TVEI. We intend to promote its wider use.


8.4 Compacts are bargains between young people, employers and schools or colleges. Young people work towards personal goals, such as improved attendance and higher attainment. In return, local employers provide a job with training, or training leading to a job, for those who achieve their goals.

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Compacts: the benefits

8.5 The Compacts programme, which we launched in 1988 as part of our strategy to revitalise the inner cities, has been a success. Fifty-one Compacts have already been set up, involving nearly 500 schools and almost 92,000 young people. Around 9,000 employers and training organisations are participating. Another 10 Compacts are in the pipeline. Compacts are expected to generate private sector and local authority funding to match the public contribution made through TECs. At present, Compacts operate only in Urban Programme Authority areas and similar areas in Scotland and Wales. Their success is such that we believe that employers, schools and colleges, and young people throughout the country should be able to adopt the Compact approach as a means of focusing attention and activity on the issue of individual attainment. Those with key local responsibilities should decide-what is best for their area. But we want the Compact approach, adapted to different local needs, to spread across the whole country.

8.6 As TECs come on stream, they are assuming responsibility for Compacts in their areas, where the relevant local education partners agree. TECs are also involved in Education-Business Partnerships which were launched in April 1991 to co-ordinate all activities to link education and business at a local level. They build on the links that have developed over the years, and offer opportunities to make education more relevant, to raise enterprise awareness and industrial understanding amongst teachers and students, and to increase employer involvement with and support for primary and secondary education.

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8.7 Where a Compact has been set up, it will usually be integrated into the Education-Business Partnership. We shall encourage new Compacts to emerge within the framework of Partnerships where appropriate, and with the full involvement of the local TEC. The potential for making the fullest use of employer-education links lies in practical developments of this kind.

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Records of achievement

8.8 Young people, and adults, need a recognised means of recording their attainment in education and training. In recent years, much excellent work has been done in schools and colleges to develop records of achievement, and to link these to action planning. We want all young people to take with them into their working lives an achievement record which can be built on as they continue to learn.

8.9 In February 1991, the Government launched the National Record of Achievement (NRA) for just this purpose. It is designed to present a simple record, in summary form, of an individual's achievement in education and training throughout working life. The relevant parts of the NRA should also help schools to report to parents on the achievements of pupils at the point of leaving school.

8.10 The response to the NRA, from schools, colleges and employers, has been very positive. Many 1991 school leavers will be using the NRA, and we expect that the great majority will do so from 1992 onwards. The readiness of many employers to adopt the NRA for use with their employees is further clear evidence that it has met a real need.

Higher level qualifications

8.11 A strong supply of high-level skills is essential to a growing high technology economy. Demand from employers is increasing for both technician-level skills and for graduates equipped with the aptitudes needed for modern management and professional work.

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8.12 Our policies will work to increase the number of people gaining higher level vocational qualifications outside higher education. They will do so through:

  • the improved status of vocational qualifications, and clearer paths to higher qualifications;
  • incentives for TECs to increase the numbers acquiring high level NVQs. The funding arrangements for TECs enable higher funding to be earned for young people reaching higher qualifications. Many are already developing joint TECI employer packages to increase skills at Level 3 and above, sharing the costs;
  • the use of training credits, to stimulate young people to train to higher levels. In the current pilots, several innovative approaches are being explored by TECs to give such incentives, and we expect these to be developed as credits are extended;
  • the work of industry training organisations to identify the skill needs of their sectors and to implement plans to meet them. The best industry training organisations are already doing this well. The Government expects the remainder to follow their lead;

[page 51]

  • the new funding arrangements for further education, which will give an incentive to colleges to offer more opportunities to reach higher level NVQs. The new Councils will be able to achieve this through weightings for different student places (see 6.6 of Volume Two).
8.13 The Government's policies have helped to secure record levels of participation in higher education. In 1980 about 1 in 8 young people in Great Britain continued into higher education from schools and colleges. It is now about 1 in 5 and is expected to improve to nearly 1 in 3 by the year 2000. This has led to record numbers in higher education despite the steep reduction in the number of school and college leavers, which is set to continue until the mid-1990s.

8.14 These increases have been made possible by the greater effectiveness and responsiveness of higher education institutions. This is especially true of polytechnics and colleges, which have made the most of their new independence from local government under the Education Reform Act.

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Training targets

8.15 Employers have a major part to play in raising standards. The Confederation of British Industry (CBI) has taken an initiative to set training targets for employers to raise the level of attainment by 16 to 19 year olds and by older employees. What they have proposed should stimulate employers to give young people many more opportunities to qualify in their first years at work and should dramatically reduce the number of jobs without training. They are consulting a wide range of other organisations to secure agreement on targets, to set out the action which needs to be taken to ensure the targets are met, and to identify who will take it.

8.16 The Government welcomes this initiative. We look forward to seeing the conclusions of the CBI's consultation, and to discussing with them how the Government can be associated most effectively with this exercise. The tasks which the Government is setting itself in this White Paper of improving the motivation of young people to qualify through credits, of creating a new independent college sector, and of completing the reform of vocational qualifications are wholly consistent with what the CBI is proposing.

Trainee status for young people

8.17 A clear signal from the labour market is needed to persuade employers to provide, and young people - and indeed adults - to take up, training, particularly to higher levels of skill. Employers need to be reasonably confident that their investment in training can be recouped from the trainee's current and future work. Young people need to be able to see that acquiring skills opens up the prospect of progressing to higher levels of pay and to more rewarding jobs.

8.18 The narrowing in the post-war years of pay differentials between young people and adults and between unskilled and skilled workers has obscured the signals about the incentives to train. Although the trend in skill differentials has been reversed to some extent in the 1980s, there is still more to be done. The pay differentials between trainees and the fully skilled are also narrow. It is not uncommon in Britain for apprentices in their final year to receive

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80 to 90 per cent of the adult rate; in Germany, for instance, they would receive 30 to 50 per cent. Employers should take more account of whether differentials for skills are adequate to secure the flow of people into the skilled occupations they need, and whether initial pay for young trainees takes into account their low initial productivity and the cost of their training. If young people can be assured that their prospects after training are good, they should be prepared to accept arrangements of this kind.

8.19 Some companies and industries have begun to develop such arrangements for young trainees, often jointly with trade unions (see box overleaf for an example).

They offer young people special trainee status and clear progression from initial trainee pay to higher rewards once they are able to put the skills they have acquired to practical use. Such arrangements are worth considering more widely by employers, so that more young people enter the labour market with an agreement with their employer which offers:

  • quality training, leading to the attainment of an NVQ;
  • special trainee status;

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  • clear routes of progression to full-skills status;
  • flexible pay arrangements which take account of the costs of training to the employer, the productivity of the trainee and the prospects of future rewards to the individual, once trained.

8.20 The Government intends to discuss these objectives further with those most concerned - employers, employer organisations, TECs, industry training organisations, unions and others - to consider whether further progress might be made. One possibility might be to develop models of how such trainee arrangements have been introduced in particular industries and could be extended to others. Another approach would be to build on the 'careership' ideas developed by the CBI and on the various forms of special trainee arrangements being tested by a number ofTECs. Such voluntary approaches are likely to offer a better and more lasting means of making progress than legislation which interferes with the freedom of young people and employers to adopt arrangements which suit their individual circumstances.

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The Government intends to require all school pupils aged 16 to stay on until the end of the summer term.

The Compact approach to raising attainment will be extended nationwide.

All young people will be offered a Record of Achievement.

More young people will be encouraged to reach higher level vocational qualifications.

Sufficient places in higher education will be available for the increasing numbers who can benefit from them.

The CBI's proposal for training targets will encourage employers to offer more young people the opportunity to qualify.

Special training status should be considered more widely for young trainees.

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9.1 The Government's aims are to give more young people opportunities for further education and training and the motivation to aim high. The colleges should playa central part in providing more high-quality opportunities. We intend to ensure that colleges are free to respond to the demand from students and employers for high-quality further education.

A new college sector

9.2 Colleges lack the full freedom which we gave to the polytechnics and higher education colleges in 1989 to respond to the demands of students and of the labour market. The Government intends to legislate to remove all colleges of further education, which offer a minimum level of full-time or part-time day release education, from local authority control.

9.3 The Government intends that sixth form colleges should also be removed from local authority control. Already in some parts of the country tertiary colleges, which are classed as colleges of further education, offer the full range of academic and vocational courses for all young people in their area. Many of them are proving very successful in attracting students. The Government believes that sixth form colleges, which can offer similar opportunities, should enjoy the same freedoms. The sixth form colleges and further education colleges together will

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form a strong new sector of education. The unnecessary distinctions between colleges of further education and sixth form colleges should disappear. Sixth form colleges will be able to carryon their strong academic traditions. But the change will provide opportunities for them to extend the vocational education they offer and to attract wider client groups. We expect many of them to seize those opportunities.

9.4 Our intention is that from 1 April 1993 the colleges will be funded directly by the Government, through new Councils appointed by and responsible to the Secretaries of State for Education and Science and for Wales.

9.5 The Councils will be responsible for a new funding regime designed to provide a powerful incentive to recruit additional students and reduce unit costs. The polytechnics are already demonstrating quite spectacularly the gains in increased student numbers and increased efficiency which full independence can bring about. That is what we want the colleges to achieve. There are great opportunities for increased participation and efficiency gains.

9.6 In allocating the resources at their disposal between institutions, the Councils will be accountable for the quality of the education and training they fund. The Councils will be placed under a duty to ensure that enough further education is provided and, in particular, that suitable full-time courses are available for all young people who want them.

9.7 Colleges will work closely with the Training and Enterprise Councils. TECs already have specific responsibilities for work related further education (WRFE). These links will be reinforced by involving TECs with the Councils, and on governing bodies of colleges. Both TECs and the colleges have much to gain from close co-operation.

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9.8 While further education colleges will receive most of their public funding through the Councils, part of their budgets for WRFE will continue, as at present, to come from the TECs. The TECs' budget for work related further education is 105 million in 1991-92. They will be expected to continue to focus on the planning of further education provision, but from 1992-93 will be able to use 15 per cent of this resource flexibly, to promote key areas of WRFE within colleges.

9.9 The Councils will ensure that there are educational opportunities for adults. Working through the further education colleges, the Councils will become responsible for the public funding of full- and part-time provision for adults which:

  • leads to academic or vocational qualifications;
  • provides access to higher education, or to higher levels of further education;
  • enables them to acquire basic skills, or skills in English for speakers of other languages;
  • caters for adults with special educational needs;
  • in Wales, enables them to learn, or improve their ability, to speak Welsh.
9.10 The Councils will also be able to provide pump-priming funds to encourage the further development of full-cost Professional, Industrial and Commercial Updating (PICKUP) activity.

9.11 The Government expects that public expenditure on education for adults will be concentrated on the courses that can help them in their careers and in daily life. It is not intended that colleges should receive explicit funding from the Councils for courses catering for adults' leisure interests.

9.12 The colleges which will form the new sector can be confident of their future. At their command are considerable skills, talent and experience. They

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also have an understanding of student needs and the demands of the labour market. With local management they have begun to take more control over their affairs. Entry into the new sector will complete that process. The Government believes that with their new freedom to manage, colleges will rise to the challenges of offering education and training which students and the country need, of increasing participation in education and training, and of raising levels of achievement.

9.13 Details of the new measures described in this chapter are set out in Volume Two.


The Government will legislate to remove further education colleges and sixth form colleges from local education authority control.

New Councils with responsibilities for colleges in the new sector will be set up.

A new system of funding for the colleges will reward expansion.

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10.1 Our plans will meet the needs of the next decade and the next century. For young people, they offer the means of qualifying for careers with good prospects and job satisfaction. They will create better opportunities for young people from all backgrounds, of both sexes, from inner cities and elsewhere. For employers, they offer the means of working with education and training providers to produce skilled and motivated young people who will make a real contribution to the success of their companies and local communities. For the 21st century economy, they offer the prospect of a workforce with first class skills to produce the wealth on which our society depends for its standard of living.

10.2 This decade our policies will create:

  • more opportunities for youngsters to start preparing for entry to work while at school and college, and to make informed choices at 16 plus;
  • education and training which encourage greater participation by young people and offer a higher proportion of them a broader and more relevant preparation for life and work;
  • more opportunities for young people to qualify at the levels needed for the 21st century and to reach their full potential;
  • for employers, a better supply of young recruits well prepared to build up the skills needed for business success;
  • a modern system of academic and vocational qualifications, both of a high standard and both highly valued, which offer ladders of opportunity right through from school to work and throughout working life;
  • a real partnership between education and business, so that both can work together to create a learning environment at the transition from school to work, and to make what is taught at school more relevant to the world of work;
  • colleges that are efficient, effective and free to respond to their customers.
10.3 The individual is at the heart of these policies. Young people must be given every opportunity to progress, and to fulfil their potential. Education and training for those aged 16 to 19 are about preparing for life and for work. Our

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policies over the last decade have done much to enrich that preparation. We have set out here our framework for giving young people the best possible start for working in the next century. It is for individuals, young people, employers and parents to act upon it.

Volume II


[title page]


Education and Training
for the 21st century

the challenge to colleges

Presented to Parliament by the Secretaries of State for Education and Science,
Employment, and Wales by Command of Her Majesty
May 1991


Cm 1536 Volume II          11.00 net (2 volumes not sold separately)

[page ii]


Chapter 9 of Volume One outlines the Government's intention to legislate to remove further education colleges and sixth form colleges from local authority control. The intended date of implementation is 1 April 1993. The colleges will be funded directly by the Government, through Councils appointed by the Secretary of State for Education and Science and the Secretary of State for Wales. Volume Two describes the proposed legislative changes.

[page iii]


Chapter 1: THE COLLEGES2
Chapter 4: THE COUNCILS12
Chapter 6: FUNDING26
Chapter 9: CONCLUSION42

[page 2]


1.1 The largest colleges of further education provide for more than 20,000 students, the smallest for under 200. Across all colleges about 21 per cent of students follow full-time courses. The others study on a part-time basis, through short courses, or through regular or occasional day or evening attendance. The sixth form colleges range from below 250 students to over 1,200, all following full-time courses. Further education colleges range from those offering the whole range of further and higher education including both vocational and academic studies, to specialist colleges offering, for example, agricultural and horticultural studies or art and design. The colleges to be given new independent management cater for almost two million students.

1.2 In 1991-92 the Government's annual local government finance settlement allows for over 2 billion in recurrent expenditure on the education and training that will become the responsibility of the Councils. Local authorities are expected in 1991-92 to invest some 100m in buildings and equipment for further education and sixth form colleges.

1.3 Local education authorities' schemes for planning and funding of further education under the local management arrangements of Section 139 of the Education Reform Act 1988 cover 363 colleges of further education maintained by the LEAs. Colleges in most Inner London boroughs, and some Welsh colleges have yet to be covered by schemes; a further 35 colleges are expected to be added to the total by 1 April 1992. These arrangements will provide the ideal basis for the natural progression to fully independent management. LEAs maintain 119 sixth form colleges, including 10 voluntary controlled and 20 voluntary aided colleges.

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2.1 All colleges of further education whose total full-time (including sandwich), block release and part-time day release student enrolments amount to at least 15 per cent of the college's student load (1) will be given independence from local government within the State education system. The purpose of this threshold is to ensure that colleges acquiring the new freedom have sufficient provision which is eligible for funding by the Councils. The Councils will, however, be able to propose that other colleges below the threshold are included in the new arrangements.

2.2 All sixth form colleges maintained by LEAs will be transferred to the new sector.

2.3 Any further education or sixth form colleges established by LEAs in the period up to April 1993 or due to be established after that date will also transfer, as will any sixth form colleges which attain grant maintained status.

2.4 The Government intends that all institutions in the new sector should operate under a single regulatory framework. This means that former sixth form colleges, including voluntary aided colleges, will cease to be governed by legislation affecting schools. A unified statutory framework will avoid different rules for different institutions and give them greater freedom. Post-16 institutions will no longer be subject to a range of requirements designed for maintained schools catering for pupils of compulsory school age.

2.5 The Government acknowledges the success of the sixth form colleges which establish a more structured regime for their pupils. But the Government considers that it would make no sense for them to be required to have different arrangements from those for the rest of further education.

(1) Calculated on the basis of full-time equivalent student data derived from the Further Education Statistical Record current at 21 March 1991.

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2.6 The Government values the distinctive contribution made by voluntary aided and voluntary controlled sixth form colleges. They will continue to be able to make that contribution. Foundation governors in voluntary aided colleges will retain their majority on governing bodies. Foundation governors in voluntary controlled colleges will form the same or a larger proportion of the governing body. Individual institutions will be free to make arrangements for religious education and collective worship as their governing bodies see fit or, in the case of sixth form colleges, as their trust deed may dictate.

2.7 The Councils will also be responsible for the public funding of those colleges in England and Wales which provide long-term residential education for adults: Ruskin College, Plater College, Hillcroft College, Fircroft College, Northern College, the Cooperative College and Coleg Harlech. The four colleges in Inner London which the Government gave a pledge to fund at the time of the Education Reform Act - the City Literary Institute, Morley College, the Mary Ward Centre and the Working Men's College - will be funded by the Council in England. And it will also take responsibility for the funding of Cordwainers College, a college substantially assisted by a LEA, and two direct grant institutions, the National Sea Training Trust and the College of the Sea.

2.8 The Council for England will take over that part of the funding of the Workers' Educational Association (WEA) currently provided through direct grant to the Association from the Department of Education and Science. Local education authorities also provide some funding for the WEA. In Wales funding provided by the Welsh Office to the WEA will be transferred to the Council.

2.9 A small number of colleges maintained by LEAs provide a majority of higher education. The Government will consider, in discussion with the institutions and other interested parties, whether these institutions should become the responsibility of the Council or the Polytechnics and Colleges Funding Council.

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3.1 Further education for adults comes from a wide range of providers. The bulk of full-time work takes place in further education colleges. Much other provision is also made in colleges, but some is made in adult education centres; in schools; in adult residential colleges; and by the WEA and other voluntary bodies.

3.2 The Government believes it is important that good quality education should be available to adults to help them improve their qualifications, update their skills and seek advancement in their present career or in a new career. The Councils will support full-time and part-time education for adults leading to:

  • National Vocational Qualifications (NVQs) (and before NVQs are fully established, to other vocational qualifications which are not yet approved as NVQs);
  • GCSEs, AS and A levels;
  • access to higher education;
  • access to higher levels of further education;
  • acquisition of basic skills (literacy and numeracy);
  • proficiency in English for speakers of other languages;
  • in Wales, proficiency in Welsh by those learning, or improving their command of, the language.
The Councils will also support courses for adults with special educational needs.

3.3 Colleges may provide all these kinds of education themselves, or they may prefer to buy it in from other providers, including LEAs and voluntary bodies.

3.4 In the case of post-experience courses related to participants' current employment (PICKUP), most are expected to be self-financing. But the Councils will be able to give funding for development costs, as do the Universities Funding Council (UFC) and the Polytechnics and Colleges Funding Council (PCFC).

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3.5 For all the institutions that they fund, the Councils will be asked to work towards the principle that their funding should be concentrated on the kinds of education for adults listed in paragraph 3.2 above. Other provision should so far as possible be supported only through fees.

3.6 Courses for the leisure interests of adults are likely to be provided in future by colleges, by schools, by LEAs, by voluntary bodies, and by private providers. Many of these bodies can put on courses at low cost, and meet that cost by charging fees. But the Government recognises that there can be a case for local authorities subsidising this work, especially in disadvantaged areas, since it can have a valuable social function.

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The structure, constitution and membership of the Councils


4.1 The Government proposes to legislate for a central Council in England, established in statute and appointed by the Secretary of State for Education and Science in consultation with the Secretary of State for Employment. The membership will be small, perhaps 12 to 15. As well as members with an educational background, there will be strong industrial, commercial and professional involvement. It will have a separate Chairman and Chief Executive.

4.2 Under the legislation the Council will have a series of regional advisory committees appointed by the Secretary of State. There will be 7 to 10 regional committees in England; each will have some 12 members. Their composition will be similar to that of the Council. The regional advisory committees will advise the Council on local issues related to its duties and powers, and on local factors which affect funding requirements.

4.3 Each committee will be located at a regional office. In support of the committees, staff employed by the Council in each region will gather information about education and training offered by the colleges and about local needs.

4.4 The regional arms of the Council will work closely with the Training and Enterprise Councils (TECs), taking account of their views of labour market needs and local vocational education and training provision. The Secretary of State will invite two representatives of local TEC interests to serve on each regional committee.


4.5The Government intends that there should be a separate Council for Wales. It will be established by statute and appointed by the Secretary of State for Wales. The Council for Wales will have a similar composition to its

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counterpart in England but will be smaller. It will not have a regional organisation but will itself work closely with TECs in Wales.

Duties and powers

4.6 The Councils' main responsibilities will lie in:

  • the allocation of resources. This includes accountability for the funds at their disposal, for the quality of the education and training they fund, and for the financial health of the colleges for which they are responsible; and
  • securing enough provision of further education, ensuring that suitable full-time courses are available for all young people who want them, and advising the Secretaries of State on the organisation and re-organisation of colleges necessary to enable them to fulfil these responsibilities.

4.7 The Councils will be required to administer the funds made available by the Secretaries of State in a way that secures the efficient management of the sector. Each Council will be accountable to the relevant Secretary of State and through him to Parliament for the application of the funds at its disposal. Financial Memoranda will be drawn up by the Secretaries of State, after consultation with the Councils, to govern the financial relationship between the Secretaries of State and the Councils and to establish the conditions on which grant is provided to the Councils.

4.8 Support for further education, including education provided by sixth form colleges, and those courses of higher education not within the funding power of the PCFC (2) or funded by the Welsh Office will be provided by the Councils. They will have the power to make grants to the governing bodies of colleges for such education within the new sector. They will also have the power to make grants for further education to colleges within the PCFC sector, and to the higher education institutions funded by the Welsh Office.

(2) The Polytechnics and Colleges Funding Council has power under Section 132(5)(c) of the Education Reform Act 1988 to fund prescribed courses of higher education provided by the institutions maintained by LEAs. The Education (Prescribed Courses of Higher Education) (England) Regulations 1989 describe those courses of higher education which are prescribed for this purpose.

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4.9 The Councils will have responsibility for allocating capital resources to the colleges within the sector.

4.10 The Councils will encourage institutions to broaden their financial base by developing funding from other sources. In making grants to governing bodies of colleges the Councils will be able to set such terms and conditions as they think fit. They will have responsibility for monitoring the financial health of the sector, and will be required to draw up Financial Memoranda with the colleges, outlining the conditions under which funding is provided to them, including the audit arrangements. The Councils will be empowered to take action in cases of financial mismanagement by colleges.


4.11 Under existing legislation, LEAs have a duty to secure the provision for their area of adequate facilities for further education. In fulfilling this duty, LEAs must have specific regard to the requirements of persons over compulsory school age with learning difficulties. LEAs are also required to ensure that sufficient secondary schools are available in their area.

4.12 Both the duty to provide adequate facilities for further education and the duty to provide sufficient full-time education for all 16 to 18 year olds will transfer to the Councils. LEAs will retain their duty to secure the provision of sufficient schools in the area for pupils of compulsory school age. When the sector is established, places for 16 to 18 year olds will be made available by LEAs (in school sixth forms), by the Councils (in former further education and sixth form colleges) and in grant-maintained schools and city technology colleges, but the duty to secure suitable full-time provision for 16 to 18 year olds will rest with the Councils. In fulfilling that duty the Councils will be required to have regard to the availability of places in schools. The Councils will also be required to have regard to the needs of those with learning difficulties.

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4.13 LEAs will retain the power to provide both existing and new sixth form places within schools and to provide further education. The latter power will enable them to continue to provide education to meet the leisure and social interests of adults.

4.14 In funding the sector the Councils will need to make broad judgements about the range and adequacy of what is available. Colleges will generally be well placed to make judgements about local needs, but they will not be in a position to make judgements about regional or national needs. The regional committees and the Council for Wales will take account of the views of TECs and will be able to draw on labour market and other relevant information provided by them. The Councils will have powers to determine the general character of a college; they will only fund the kinds of education which they consider appropriate to be made by that college.

4.15 In some areas a college may be the sole supplier of post-16 education and training. The Councils - advised by regional committees in England - may identify needs (for example, special educational needs) which are not being met. The Councils will have reserve powers to require places for individuals to be provided. Guidance from the Secretaries of State will make clear that they are for use in exceptional circumstances only.


4.16 The Councils will be placed under a general duty to have regard to the requirements of students with learning difficulties. The provisions of the 1981 Education Act relating to pupils in schools will not, however, extend to the Councils. The 1981 Act requirements for LEAs to provide assessments and statements of special educational needs are not flexible enough for young people who are getting ready to take up vocational opportunities in colleges. In deploying the resources available to them for special educational needs, it is important that colleges should not be constrained by the specific requirements of statements which were more relevant to an earlier stage of students' development. The more general

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requirement that is appropriate to the older age-group will allow colleges to use their resources to meet the pre-vocational and other educational requirements of all students with disabilities.


4.17 Changes in the structure of the sector may be necessary from time to time; for example:

  • the establishment of a new college to meet the needs of an expanding area;
  • the merger of existing colleges in response to changing demands in an area; or
  • the closure of a college where sufficient demand no longer exists.
In fulfilling their duty to secure the provision of adequate further education the Councils will advise the relevant Secretary of State on such changes.

4.18 Where a Council intends to make proposals:

  • to establish a new college;
  • to merge existing colleges; or
  • to close a college,
it will be required to consult LEAs, and others affected by the proposals. It will be required to publish them in a manner prescribed by the Secretaries of State and submit copies to the relevant Secretary of State and to other bodies with an interest.

4.19 The Secretaries of State will have power to designate new corporate bodies to be included within the sector and to dissolve existing corporate bodies.

4.20 LEAs will retain their existing powers in relation to the organisation and re-organisation of schools. But some voluntary bodies might wish in due course to re-organise their secondary schools in order to move existing sixth

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form provision into the new sector. The Government intends to give the governing bodies of voluntary aided secondary schools an additional power to propose the closure of their school when this is a necessary part of a plan to move pupils aged 16 to 18 into the sector.


4.21 In order to exercise their functions, the Councils will require information. This will include information:

  • about the range of education and training available in LEA-maintained schools in the area;
  • about the work in the colleges which the Councils fund, their plans for future changes, and about their performance.
The legislation will place a duty on LEAs, the governing bodies of institutions in the new sector, and other relevant institutions to provide appropriate information to the Councils.

Residual responsibilities of LEAs

4.22 LEAs will continue to be responsible for the Youth Service. They will retain responsibility for certain functions related to participation in further education, notably responsibility for discretionary awards and education maintenance allowances.

4.23 Local authorities also will retain responsibility for the provision of transport to college. The Government intends to legislate to place LEAs under an obligation to treat full-time students aged 16 to 18 in colleges in the new sector no less favourably than sixth form students in schools for this purpose.

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Corporate status

5.1 Colleges in the new sector which are at present maintained by LEAs will need to be established as corporate bodies in the new sector with their own legal identity. The colleges will gain charitable status which will enable them to benefit from charitable donations.

5.2 Certain colleges coming into the new sector are not maintained by local authorities. These include the institutions mentioned in paragraph 2.7. The Government intends that these colleges should broadly retain their present status and that the composition of their governing bodies should remain broadly the same.

5.3 As corporate bodies, institutions in the new sector will have powers:

  • to provide education for those over the age of 16;
  • to employ their own staff;
  • to enter into contracts on their own behalf;
  • to manage assets and resources; and
  • to act otherwise as a legal body undertaking activities in furtherance of their purposes as providers of education: for example, contracting to provide services, engaging in consultancy, joining in co-operative enterprises with industry or local authorities.
Instruments and articles of government

5.4 Further education colleges maintained by LEAs operate at present under instruments and articles of government approved under provisions of the Education Reform Act 1988. Sixth form colleges have instruments and articles in accord with the Education (No 2) Act 1986 and the Education Reform Act. The instruments and articles will need to be revised to reflect the status of the colleges.

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5.5 Instruments of government determine the composition of governing bodies. the Government wishes to see the work of governing bodies proceed with the minimum disruption possible. The Government therefore intends that the majority of governors on college governing bodies should continue to serve. But it will not be appropriate for colleges to have on their governing bodies representatives of local authorities.

5.6 Existing instruments for further education colleges provide for not less than 50 per cent of members of the governing body to represent employment interests or to be co-opted. LEA representatives constitute up to 20 per cent of governors. Other members of the governing body usually include the principal, members of staff, a student, a representative of a neighbouring educational institution and a representative of a local community organisation. After the reforms instruments of government will no longer provide for formal LEA representation. The legislation will, however, remove the provision in the Education Reform Act 1988 which prevents people who are local authority members or employees from being co-opted onto governing bodies. Governing bodies will be able to co-opt two additional members. This means that some governors may well combine their public service on the governing body with membership of a local authority. They will be co-opted for their individual qualities, however, and not as delegates or representatives of the local authority. The Government expects that governing bodies may wish to co-opt a senior member of the college's management, in addition to the college principal who is already a member in most cases.

5.7 The Government proposes that the existing employment interest governors should be supplemented by a representative of a local TEC. This will reflect the TECs' important contribution to training locally, and their increasing involvement in vocational education. Further education college governing bodies may also wish to review their overall composition. The legislation will provide for the Secretaries of State to have power to modify their instruments of government after consultation with the governing body concerned and the relevant Council.

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5.8 The governing bodies of county and voluntary controlled sixth form colleges at the moment include elected parent and teacher representatives, the head (if he or she chooses), LEA representatives, and either a number of co-optees or (for controlled colleges) one co-optee and a number of foundation governors. Governors have to make sure that the local business community is adequately represented on governing bodies, whether by co-option or otherwise. After the reforms, instruments of government will no longer provide for LEA representatives. As for further education colleges, governing bodies will be able to make two additional co-options if they wish, and the same considerations as in paragraph 5.6 will apply to the choice of individuals. The relationship with the local business community will be reinforced by a representative of a local TEC.

5.9 The governing bodies of voluntary aided sixth form colleges have members from among the same groups, but composition is not otherwise standardised. There must at present be at least one LEA representative, and foundation governors must have an overall majority of two or three, depending on the size of the school. The Government intends to preserve the foundation's majority position. By removing LEA appointees and allowing for a TEC representative, the size of the governing body may remain the same, or be reduced, so foundation governors will retain or increase their majority. If they so wish, the governing bodies of these colleges may co-opt two further governors as set out in paragraph 5.6.

5.10 The Government intends that in this way voluntary aided and voluntary controlled sixth form colleges will continue to be able to make their particular contribution to the education of pupils over the age of 16. Their distinct ethos and tradition can be preserved.

5.11 Sixth form colleges have up to now concentrated mainly on academic courses with less emphasis on vocational education. With the transfer to the new sector, sixth form colleges may wish to review their range of activities and

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to increase their offering of vocational education. They will be able to provide education for adults. With that in mind, these colleges may wish to look at the membership of their governing bodies. The legislation will give the Secretaries of State the power to change the instruments of government so as, for example, to require increased representation of employment interests, after consultation with the governing body of the college and the relevant Council.


5.12 Colleges' articles of government set out the way in which the business of the college is to be conducted. These will similarly need to be revised. They will need to reflect the colleges' status as independent corporations responsible for their own financial affairs, for the employment of staff and with increased responsibilities for their conduct.

5.13 The Government intends that the legislation should provide for new articles which will apply to all the colleges formerly maintained by LEAs. Colleges will have the right to apply to the relevant Secretary of State to amend these model articles to suit their particular circumstances.

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6.1 In 1991-92 over 2 billion will be spent on the education which is to be transferred to the newly independent colleges. That includes spending on further education and sixth form colleges; on other education for adults which will come within the Councils' remit; and a pro-rata share of administration and support services.

6.2 The level of spending in 1992-93 will be determined in due course. In the light of that and of the latest available data about the actual pattern of spending on post-16 education, an appropriate deduction will be made from Revenue Support Grant from April 1993, and the funds transferred to the budget for setting up the new sector. The result of the adjustments to be made in Revenue Support Grant will be that the same balance as now is maintained between central and local taxation. The budget for the new sector will include the grants currently made by the DES and the Welsh Office direct to certain institutions and the WEA (see paragraphs 2.7 and 2.8) being transferred to it. In addition, colleges will continue to receive:

  • grants from TECs under the work-related further education programme;
  • fee income, as now, from students or their employers;
  • credits income in areas where training credits apply;
  • grants from the PCFC for prescribed types of higher education; and
  • whatever income they can earn from full-cost courses, consultancy and other services.
6.3 The baseline budget for 1993-94 and the public funds to be allocated to the sector in each successive year will be determined as part of the annual Public Expenditure Survey. In setting the level of funds available for distribution each year the Government will take account of the demographic trend, the trend in participation levels and the scope for increased efficiency within the sector.

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Recurrent funding

6.4 Recurrent funding for the sector will consist of two elements:

  • a cash-limited block grant for distribution to institutions by the Councils;
  • a separate element of funding, directly related to student numbers, which is intended to encourage efficient growth in the system.

6.5 The cash-limited block grant will be paid to the Councils for distribution between institutions. The basis of distribution will be for the Councils to determine, subject to general guidance from the appropriate Secretary of State.

6.6 For the most part, allocations will reflect historic or expected student numbers as a means of guaranteeing a degree of continuity. But it will be open to the Councils to reserve a proportion of the block grant for distribution against other criteria. They will be able to apply weightings to student numbers to take account of differential costs of classroom- or workshop-based studies and of higher-level studies, and additional costs arising from such factors as special educational needs.


6.7 Colleges will also receive an element of their funding related to actual student enrolments, paid through the Councils. The additional income will take the form of predetermined amounts on a sliding scale for additional students enrolled, calculated so as to provide a powerful incentive to expand participation. Payments - based on actual student numbers when enrolments are known - will reach the colleges as soon as possible after enrolments to ensure that the rewards for increasing participation are not detached from the achievement. It will be open to the Councils to establish different unit funding for different categories of student. This will mean that the total resources available to the Councils and hence to colleges will be determined in part by the actual number of students recruited in the year in question.

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6.8 The balance between the cash-limited block grant and the student related element of funding will be subject to review annually. The Secretaries of State will adjust the balance as necessary to take account of levels of demand and the response of colleges to that demand.


6.9 The work related further education programme, funded by the Department of Employment, links vocational education to local labour market needs. The programme has been transferred to Training and Enterprise Councils from April 1991. They will continue to have control over the programme; the funding relationship between the TECs and the colleges will take full account of the wider funding arrangements for the new sector. The Councils and the TECs will need to come to an understanding about how to align their activities.


6.10 In areas where TECs are running training credits schemes, the cost of part-time education and training for school-leavers will be met through training credits. In other areas the funding of part-time study for this group will be the responsibility of the Councils.


6.11 Colleges will be expected to charge appropriate fees to individuals and employers. The Councils will have the power to make recommendations on fee levels for publicly-funded courses, and each college will be free to determine, in the light of those recommendations, what fees to charge.

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Capital funding

6.12 The Councils will have responsibility for the allocation between colleges of resources made available by central Government for capital expenditure. The Secretaries of State for Education and Science and Wales will set annually the total public funds available for this purpose. The funds will be identified separately from the funds for recurrent expenditure. These arrangements will replace the current regime for capital expenditure in the local authority sector.

6.13 The funds made available for capital expenditure will encompass major building projects, adaptations to buildings and the purchase of major items of equipment. Colleges will have significant freedom to meet the cost of capital expenditure from other resources.

6.14 The Government intends that voluntary aided sixth form colleges should be treated for funding purposes in the same way as other colleges in the sector. At present the governors of the voluntary aided colleges have distinct financial liabilities for capital expenditure, defined in law according to the nature of the project and the circumstances in which the costs arise. Governors share responsibility for repair work at these colleges. Those arrangements will be discontinued.

Value Added Tax

6.15 Local authorities can recover the VAT they incur on the provision of education under section 20 of the VAT Act 1983. Colleges will no longer benefit from this facility when they become free-standing bodies. This change in status will be among the factors taken into account in setting the total funding for the new sector.

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6.16 The Permanent Secretaries of the Department of Education and Science and the Welsh Office will be Accounting Officers for the grants paid by the Departments to the Councils. The Chief Executives of the Councils will be Accounting Officers for the administration of those resources. The Councils will therefore need to satisfy themselves that individual colleges have adequate management and audit systems. The Councils will be required to draw up Financial Memoranda with the colleges, outlining the general conditions under which funding is provided to them, including the audit arrangements.

6.17 The Councils will be required to present annual audited accounts to Parliament in a form determined by the Secretaries of State. The auditors' reports will be required to certify that the use of grant was in accordance with the terms and conditions set by the Secretaries of State. The National Audit Office will have access to the Councils' papers.

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7.1 The Government intends that the land, buildings and equipment which are currently used by colleges in the new sector should be vested in those colleges on 1 April 1993. These assets will be vested with the governing body of the institution for the life of that institution. From vesting day, colleges will become responsible for holding, managing and maintaining those assets. The trustees of voluntary aided sixth form colleges already own the relevant assets.

7.2 Those assets were obtained and maintained on a basis which shared the cost between local and national taxpayers. They were provided in order to secure further education for the local population. As the assets will continue to be available to serve that purpose, the Government does not propose to compensate LEAs for the assets transferred to the new sector.

7.3 The forthcoming legislation will set out the means by which these assets are to be transferred. Following the passage of that legislation, the relevant assets will need to be identified and procedures put in place to ensure an orderly transfer from the local authority to the colleges. In most instances, identification of the relevant assets should not pose significant problems. But a local authority and a college may sometimes differ on whether particular assets ought to be transferred. There may also be cases where determination is needed on how particular assets should be shared, or use of them shared, between two or more colleges, or between a college and a school.

7.4 The Government expects that most such differences will be settled locally between the authority and the college concerned. But reference to an outside body may help to resolve some outstanding differences. The Government proposes to extend the remit of the Education Assets Board to enable it to fulfil this role. The Board, established under the Education Reform Act 1988, has had experience in the transfer of the assets and liabilities of polytechnics and of grant-maintained schools.

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7.5 Chapter 3 described the education for adults which will be supported by the Councils, working through the colleges. Colleges may provide all these kinds of education themselves or may buy in some work from other providers, including LEAs and voluntary bodies.

7.6 The education of adults is currently organised in different ways in different areas: it can be provided by further education colleges in their own or in other premises, in separate adult education centres, or in community schools.

7.7 Where colleges currently use premises and other assets which are wholly devoted to the education of adults, those assets will be vested in them along with the rest of the college'S assets. Any disputes about such assets will be considered in the same way as other disputes (paragraph 7.4 above). The same arrangements will apply to assets which may be given to the college by the LEA between now and March 1993. The Government is aware that some LEAs are in the process of increasing their colleges' responsibilities for education for adults.

7.8 It will be for colleges to consider how best to discharge their new responsibilities for the education of adults. In many cases, the best way to exercise those responsibilities will be through the use of premises and equipment which the colleges do not control. The Government expects that colleges will enter into agreements with LEAs, school governing bodies and others for the use of such premises and equipment. This will help ensure that the best use is made of available resources and that a coherent education service for adults is provided.

7.9 Difficulties may arise, however, if a college is denied access to some dedicated facility for the education of adults, or if such a facility falls out of public use. To guard against such dangers, the legislation will provide that a college may apply at any time within three years after 1 April 1993 for the vesting in itself

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of an asset belonging to an LEA used primarily for the education of adults which it needs for the discharge of its responsibilities, and to which it cannot secure guaranteed access by other means. The remit of the Education Assets Board will be extended to help resolve any difficulties between authorities and colleges.


7.10 The Secretaries of State announced on 21 March that they intended to seek the approval of Parliament to legislation which requires their specific consent for all disposals by local education authorities of land or interests in land, including buildings, used or held or obtained for, or in connection with, the purposes of the institutions forming the new sector. Similar powers will also be sought with regard to voluntary sixth form colleges where the LEA will need to convey its interest in such assets to the trustees of the school.

7.11 The disposals of land or interests in land requiring the consent of the Secretary of State will include outright sale, granting or otherwise disposing of any leasehold or other interest in land, direct sale and leaseback, any mortgage or other charge designed to raise capital on the security of the land. It will also include any disposal which is made in return for the supply of goods or services. Such disposals also include entering into any binding obligation to make a disposal of the kind in question. This measure will have effect from 22 March 1991 but does not affect enforceable obligations entered into before that.

7.12 In addition, the Secretaries of State will seek the approval of Parliament for a measure, effective from 22 March 1991, which will require local authorities entering into contracts which bind colleges in the new sector beyond 1 April 1993 to obtain the specific consent of the governing body concerned. Contracts for a consideration having a value in excess of 50,000 will also require the specific consent of the relevant Secretary of State.

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7.13 Parliament's approval will be sought for appropriate sanctions where prior consent has not been obtained. For disposals of land or interests in land without the consent of the relevant Secretary of State, there will be a power of compulsory purchase with a right of recovery from the local authority of any compensation payable. For contracts, including contracts for disposal, entered into without the consent of the governing body concerned or, where applicable, that of the Secretary of State, there will be a right of repudiation, and such repudiation will be deemed to be a repudiation by the relevant local authority so that any liability and damages will remain with that authority.

Debt charges

7.14 Local authorities are currently responsible for meeting debt charges attaching to the property of the colleges they maintain. They receive support for this expenditure through annual local authority finance settlements. Some debt charges relate to projects dating back many years. It would be complex and time-consuming to identify and separate out charges relating to college property from the rest of local authorities' historic debt. The Government therefore proposes that local authorities should retain liability for all debt charges relating to college property incurred up to April 1991. The Government will continue to provide support in the same way as now through Revenue Support Grant to help authorities meet those liabilities.

7.15 For new capital projects starting in financial years 1991-92 and 1992-93, local authorities will bear the cost of charges in those years in the normal way. But from 1 April 1993 the Councils will take responsibility for meeting the cost of servicing debts arising from new contracts approved by the relevant Secretary of State in accordance with paragraph 7.12. The Councils will take responsibility for meeting the cost of these debts provided that the debts do not exceed the level of the annual capital guidelines for relevant institutions in each of these two financial years for the authority concerned. In this way local authorities can enter into capital commitments with confidence that the continuing costs will be covered.

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Pay and conditions of service

7.16 At present the pay and conditions of teaching staff in further education establishments are determined through negotiation between the LEA employers and the lecturer unions in the National Joint Council for Further Education. The teaching staff in sixth form colleges are school teachers: their pay and conditions are currently determined by the Secretary of State for Education and Science on the advice of the Interim Advisory Committee under the Teachers' Pay and Conditions Act 1987. The pay and conditions of non-teaching staff in both further education establishments and sixth form colleges are negotiated between the local authority employers and the staff in the relevant National Joint Councils.

7.17 The staffs of further education and sixth form colleges will initially be transferred to the employment of the institutions in the new sector on their existing pay and conditions, as with the transfers of staff to grant-maintained schools and to polytechnics and colleges under sections 75 and 127 of the Education Reform Act 1988. This block transfer will remove uncertainty for both staff and their employers. At the point of transfer the statutory pay and conditions arrangements applicable to school teachers will cease to apply to those staff who transfer to the new sector from institutions which are currently schools. Where an asset used for the education of adults is vested in a college later than 1 April 1993 in the way described in paragraph 7.9 above, staff employed wholly in connection with that asset would likewise have a right of transfer of employment to the college.

7.18 The Government intends that pay and conditions within the new sector should be settled through negotiation between employer and employee, subject to protection for the taxpayer's interest in the cost of any pay offers made nationally. The Government believes that there should be the maximum freedom for institutions to set pay in response to their own needs and circumstances, whatever negotiating arrangements are judged, after discussion, to be appropriate. The detailed arrangements for the negotiations will need to be considered by the institutions concerned, with the staff interests and with Government.

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8.1 The Government attaches great importance to systems which will ensure the quality of education and training provided by the colleges. Responsibilities for monitoring and assessing quality in the new sector need to be defined clearly.

8.2 At present there are three levels of quality assurance in further education:

colleges have primary responsibility for quality control. Most already have mechanisms for assessing the quality of the education and training they provide. Performance indicators related to quality are being developed as part of college management information systems. Colleges need effective systems to improve their quality and contribute to their own efficiency and effectiveness. It would be premature to advocate any one framework, but a number of systems are being explored by colleges including BS5750, Total Quality Management (TQM) and Strategic Quality Management (SQM). Colleges will be expected to provide information to the Councils about the quality assurance systems they have in place;

examining and validating bodies are responsible for guaranteeing the quality of the qualifications offered in colleges. These include the City and Guilds of London Institute, the Business & Technician Education Council, the Royal Society of Arts, a wide range of professional bodies and the GCE Boards offering A level and AS exams. The number and level of qualifications achieved offer one measure of a college's performance;

external assessors are responsible for making an independent judgement of the quality of teaching and learning in colleges, and for offering advice. The two main sources of this external assessment at present are Her Majesty's Inspectorate and the LEA advisers.

8.3 The quality assurance responsibilities of colleges and validating bodies will be unchanged by the new arrangements. But the role of external assessment will inevitably be different, in two respects:

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  • the Councils will have responsibility for:
    a) ensuring that quality systems in general form a satisfactory basis for the funding being provided: responsibility for quality flows from responsibility for finance; and
    b) making specific financial allocation decisions which should be informed by quality judgements.
  • LEAs will no longer have a role.
8.4 The Government therefore intends to place a duty on the Councils to secure advice on the quality of what is provided by institutions in the new sector. For the immediate future the main source of that advice is likely to be Her Majesty's Inspectorate. The Government expects that, over time, these arrangements will evolve as the sector evolves. The development of other sources of quality advice in the further education sector is not ruled out.

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9.1 Volume Two has outlined the Government's proposals for the future of further education and sixth form colleges. The changes will give the colleges greater freedom to determine how to respond to the country's education and training needs. They will enable the colleges to raise participation and to boost achievement.

9.2 The proposals described here will form the basis for the legislation which the Government intends to introduce. The Department of Education and Science and the Welsh Office will take account of the views of interested parties on these proposals in preparing the legislation. Comments should be sent to Mr M Bell, Room 7/1, Department of Education and Science, Elizabeth House, York Road, London SEI 7PH or Mr D J Baglow, Welsh Office Education Department, Phase II, Inland Revenue Building, Ty Glas Road, Llanishen, Cardiff CF4 5PL by Friday 12 July 1991.