I enjoyed reading the views of your correspondents on how the LSC should spend its money. It's always good to hear the views of our many partners. The Secretary ofState for Education, Alan Johnson has sent us the outline for next year's expenditure in our Grant Letter. And I was pleased to see how much of what our partners wanted from us is actually reflected in our funding and planning priorities for 2007-08.
We will be investing a record £11.2 billion in 2007-08. One priority is to raise the opportunities and participation of young people in learning. We will be investing around £7 billion in this, and a key target for us is to get 90% of 17 year olds in education or training by 2015. And we want to raise the skills of the nation "“and will be investing over £3 billion to help over 4 million adults and thousands of employers to improve their skills.
We also want to build a world-class FE system, so we will be spending £600 million in buildings and learning environments to improve facilities. An additional £181 million will be invested in specialist colleges for Learners with Learning Disabilities and/or Difficulties. Plus over £800 million will be spent on learner support and development, including efforts to engage more learners from disadvantaged backgrounds.
The sector is achieving at a remarkable rate: one million adults have achieved essential Level 2 qualifications since 2002, and we are six months ahead of our target to have 3.6 million adults with Level 2 qualifications by 2010. These sorts of results can literally transform people's lives, allowing them to progress in learning and work.
Stephen Williams MP and Lawrence Miles of the IVA talked about narrowing the funding gap between school sixth forms and FE colleges. We are committed to this, which is why next year, we are increasing the base rates for 16-18 provision by 3.7 per cent in line with the Minimum Funding Guarantee in schools. Stephen suggested that the LSC is not investing in training England's ageing population. In fact, we are putting an additional £460 million into our Train to Gain programme, in order to help half a million adults gain a Level 2. Train to Gain particularly targets those already in work who may have missed out on formal education or training for one reason or another. Plus we have safeguarded expenditure on Personal and Community Development Learning (PCDL) at £210 million for next year.
Claire Donovan from the EEF mentioned the importance of investing in higher-level skills, for businesses. In fact overall the LSC spends more on Level 3 and above than we do on Level 2. Train to Gain not only provides qualifications at Level 2, but will organise provision up to Level 4. The LSC is supporting the development of 12 National Skills Academies by 2008. The curriculum in the academies will be led by employers and will provide a strong vocational route for both young people and adults.
In terms of fees, we believe that it is only right that those individuals and employers that can afford it should pay for part of the cost of their learning. Our assumption is that fees will be increased from an average of £1.73 per hour to £2.05 for courses in 2007-08; this represents 37.5% of the total cost. This will not affect adults on means-tested benefit. MORI polling actually suggests that the majority of adults think that taking an FE course is a good investment and over half say that either they or their employer should pay at least 50 per cent of the cost of vocational courses.
As Alison West of the NEC identified, the reputation of FE is growing and the sector is achieving at a remarkable rate. The Government signalled its support for the sector, and the LSC in the recent FE Bill, but also emphasised the importance of widening consultation with learners and employers and increasing local decision-making.
As Graham Hoyle of ALP identified, our future approach to funding will be more demand-led. Our Chief Executive Mark Haysom spoke about this at the recent Association of Colleges Conference when he talked about the LSC becoming more of a market-maker and encouraging greater choice and diversity in the sector. Opening up the market doesn"t mean that we don"t see teaching and learning at the heart of the sector's achievements - but it is essential that this is twinned with a good business sense, in order to increase the value for money and stature of the sector.
We are keen to listen more. This month, our Chairman Chris Banks helped launch the National Learner Panel. This will consult with learners on our all our policies and is supported by organisations such as the National Union of Students.
Graham and Stephen also talked about efficiency, and as recently announced by theGovernment, the LSC will be further streamlining its non-executive councils in order to become more efficient and locally-focused. In 2007-08 we will put in place nine regional councils with 153 local partnership teams in place to work at a more local level with our partners in the community. We have already saved £40 million through restructuring our organisation over the past year and will continue to save money through cutting out "red tape". We will be implementing data reforms such as Managing Information Across Partners (MIAP), which will allow us to share data across the sector and cut out repetitive collection.
The overwhelming majority of our budget is spent on the front-line delivery of programmes and facilities for learners and employers - administrative costs represent only about 2.5% of our budget. This is comparable to, and in many cases, lower than, a large number of organisations, including major charities. But, as an organisation we are aware that we have a lot more hard work to do. We must be bolder in our approach, and must continue to work hand-in-hand with our partners across the sector to implement the dynamic changes that are needed if England is to continue to compete in the 21st Century.
Rob Wye, Director of Strategy and Communications, Learning and Skills Council.
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