Fit for the Future: developing a post-school learning system to fuel economic transformation

Chapter 2: The current landscape: themes

2.01 This chapter sets out my analysis of the existing landscape against the vision I have articulated in the previous chapter of 'what good looks like'. It has been based on my wide engagement with different stakeholders in the post-school learning system, the public webinar sessions that my Secretariat ran as part of the Review, and the formal, independent analysis of the call for evidence submissions and webinar notes.

A landscape of tensions

2.02 It is important to state at the outset that there are many positive areas of work in the skills delivery landscape. At its core, it is driven by motivated individuals and organisations with good intent. However, it has become clear in the process of this Review that the system must improve and change if it is to rise to the challenges facing Scotland's future economy and society. If a good system is one that understands what success looks like and can clearly demonstrate its impact, uses its resources efficiently and to best effect, is designed with its users at its heart, responds to local circumstance and is built on effective partnership working, then the current skills delivery landscape is falling short. Very few people I spoke to thought that the status quo was optimal and most were calling for a fundamental refocusing and repurposing of the system.

2.03 I attribute this to significant tensions that exist, with agencies battling to secure their roles and advocate for their distinct parts of the system rather than working in collaboration, with a focus on the user, to deliver effective, efficient and joined-up public services. There are tensions between the remits and philosophies of national agencies, between national and local level delivery, between different pathways and programmes, and between the needs and demands of different system 'users'. Institutions and sectors, public agencies and providers are often jostling for responsibility, funding and recognition when they should be working collectively towards shared goals for the benefit of the existing and future workforce of Scotland.

Lack of strategic direction, shared narrative and measures of success

2.04 My frustration at the current landscape stems from the fact there are a lot of good intentions, good ideas, knowledge and expertise and successful initiatives or partnerships. However, the whole is not greater than the sum of these parts. Despite all these attributes of the system, there is a lack of cohesive approach, common purpose or strategic narrative joining them together. This extends to the use of basic aspects such as language where often there is no common interpretation about what is meant by frequently-used terms leading to a lack of understanding of intent which, in turn, impacts on how interventions are designed and delivered.

2.05 Since Skills Development Scotland (SDS) was established in 2008, the landscape has been largely left to evolve, with the Scottish Government responding to issues or problems with adjustments, rather than wholesale reform, despite navigating through some significant changes and challenges in the social, economic and political environment. Many of the issues we face now have been apparent for some time. In the absence of structural reform, the remits of public bodies, groups and actors have also evolved - sometimes entirely independently of their own accord and sometimes stretching into the same areas of work. This has resulted in competing narratives and approaches and duplication of efforts and resources. Consequently, there is a lack of clarity about who does what and why, the parameters of success and who is ultimately accountable – all of which, in the context of skills planning, were identified recently by Audit Scotland^[10] and attributed, at least in part, to a lack of leadership and effective governance.

2.06 Users trying to access or navigate the system – whether individuals or employers – struggle to know which of the many entry points to use or which narrative to adopt. They expend effort engaging with multiple bodies at different levels to try to find the advice they need. I consistently heard that the landscape is cluttered and complex. I would contend that it is not necessarily complexity that is the problem, it is confusion. Complexity itself isn't a sign of system failure and indeed there are advantages to having diversity of choice and voice within a system, particularly when its users are so diverse with a multiplicity of needs and desires. However, a lack of clarity is problematic as it means we don't have a whole-system view which impedes the ability to construct and implement a coherent strategy. This lack of clarity extends not just to the roles and expectations of different actors, but the process for prioritising and agreeing finance, the terminology and language that is used, the scope and esteem given to different qualifications and pathways, and the data that informs decision-making or measures impact.

Complex and fragmented funding environment

2.07 There is currently around £3.2 billion (based on 23/24 Scottish budget^[11]) invested annually in post-school Education and Skills by the Scottish Government, which does not include skills and education initiatives in other portfolio budgets. This is a substantial sum, a large portion of which supports free tuition for higher education and student living costs. I did hear concerns, during the course of my engagement, about where and how funding is allocated and, in particular, the balance of funding between different institutions, programmes and provision. It was clear to me when commencing this Review that, although it is not being driven by efficiency savings, recommending changes which would require substantial new public investment would not take account of the current fiscal environment and public service reform commitments set out in the Scottish Government's Resource Spending Review (RSR)^[12]. The Scottish Government's policy on tuition fees is well established and represents a significant investment in policy and financial terms. Many of the conversations I heard reflected the view that there are other interventions, beyond first degrees in universities, that equally support learner and economic outcomes. However, as long as free tuition continues to be a core policy of Ministers in Scotland, extending the scope of financial support beyond those pursuing first degrees in universities or to those who already have benefitted from free provision, would be challenging. This makes rebalancing the current investment in post-school education and skills more difficult.

2.08 However, the main message that I took from conversations with stakeholders is that funding is too fragmented, ultimately impeding the ability of providers to be flexible to respond to user needs. It seems that there is money flowing through the system that could be used to better effect. At present there is a good deal of funding from central government arising from project or programme-level initiatives, attempting to address different sectoral, place-based, or user challenges. Most of these are not long-term programmes and this leads to uncertainty, makes forward planning difficult and can create a competitive environment within and between delivery agents. Representatives from colleges, for example, told me that there were multiple pots of funding available to them each with different criteria, aims and reporting requirements. While programmes like the National Transition Training Fund (NTTF) or elements of the Young Person's Guarantee (YPG) have helped to fund additional short sharp provision to support upskilling and retraining outcomes, this was as a 'bolt on' to core provision and has only been available short-term. As such, when these funds have been withdrawn, the gap in core provision remains. There is a strong view from institutions about the need to absorb any additional funding within existing strategies rather than the creation of new initiatives that come with additional, and sometimes overlapping and duplicative reporting requirements.

2.09 Even within the 'core' offer there are different approaches to funding of provision. For example, the funding that flows through colleges and universities compared to the funding allocated to apprenticeships. Yet this division is not simple. Apprenticeships are also often delivered through colleges and universities and, even where the responsibility for funding has shifted between agencies in recent years, there are still differences in the way funding is allocated to these pathways compared to other provision. Therefore, we have pockets of spending for different provision, some of which are unhelpfully driven by input targets, some by learner behaviours, and all of which appear to run contrary to the calls for institutions to deliver and be responsive to local economic needs.

Incoherent, disjointed pathways and a failure of language

2.10 The fragmented nature of funding is mirrored in the qualifications and pathways within the post-school system. My Terms of Reference (ToR) was not focussed on qualifications and I don't want to cut across the critical work of Professor Louise Hayward who is currently preparing her recommendations for Ministers in relation to qualifications and assessment in the senior phase. However, it is evident from what I have heard that there is no clarity about the different qualifications and pathways available, a view which is reaffirmed by the lack of bodies or individuals I have spoken to who have a complete or comprehensive overview of the post-school qualifications landscape.

2.11 The Scottish Credit and Qualifications Framework (SCQF) is a real asset. It offers the opportunity to think about learning at different levels and to create pathways through those levels. Critically, it maps an often bewildering set of different names for qualifications against a single set of attainment levels. I have found this framing of the different stages easy to understand and accessible. Yet, it appears to be often ignored when thinking strategically on post-school learning. In particular, it is an enormous lost opportunity that this framework doesn't form the backbone of how we talk about qualifications. Instead, we have poor articulation between different qualifications, a lack of clarity about how learners are expected to move in and between the various 'products' on offer, and a disregard for the destination that these pathways are headed towards, which for most (if not all) will be the workplace.

2.12 As a result, although the SCQF would suggest that all pathways are created equal, it can appear that some are still more equal than others. For example, in the senior phase of school, a Level 6 Foundation Apprenticeship (FA) has the same attainment value as a Level 6 Higher. Yet I was told by some headteachers that they are often not viewed as comparable and that there is little consistency in the way that educational institutions will treat them when assessing entry requirements for further and higher education. This was also a finding of Professor Ken Muir's recent report^[13]. Parity of esteem, it would seem, still remains an illusion in too many cases.

2.13 There were numerous calls for more attention, and funding, to be paid to 'vocational' pathways and qualifications as opposed to 'academic' pathways. However, as reflective of Professor Hayward's Independent Review of Qualifications and Assessment in Scotland Interim Report^[14] which outlined a common view to reconsider the use of 'academic' and 'vocational' terms, language or terminology is critical. A hugely damaging and, in my view, completely false division has been created in the learning system, somehow suggesting an individual either decides to pursue skills or an education. Terms like vocational are often used to apply to apprenticeships and college courses, but not professional occupation-focused degree programmes like medicine or law. The implication is that skills aren't being delivered through 'academic' pathways, and that individuals will only arise work-ready from a more tailored, vocational course or apprenticeship. Both these views are patently untrue but culturally persist. This false dichotomy between university education and vocational learning is inherently problematic. The Graduate Apprenticeship (GA), a product with a misleading name, but a huge potential, is a case in point as it brings both the world of work and higher education institutions together through a single qualification. Yet, the structure of the agency landscape also reflects this harmful, false division and fuels its persistence, with the Scottish Funding Council (SFC) and SDS each advocating for different parts the system.

2.14 In my view, skills are not something which sit separately to or against higher or further education. They are a product of a good learning system. The majority of jobs can be done with a set of core 'meta skills' (or 'foundational skills' or 'core skills' depending which language we are speaking) with employers needing to be responsible for providing more specialist on-the-job training. Some occupations, however, require a set of more specific technical skills, which necessitate specialist training or professional accreditation. Yet there doesn't seem to be clarity about what we mean by vocational and which subjects might require this more tailored, technical approach to skills development or, indeed, which are better suited to delivery through apprenticeships or work-integrated learning, than in an institutional setting.

Absence of national prioritisation and regional flexibility

2.15 This brings me to skills planning, which was the subject of Audit Scotland's report^[15] more than a year ago noting the lack of progress that had been made on skills alignment – the process by which skills are matched to the needs of the economy.

2.16 Although Audit Scotland has acknowledged action by the Scottish Government and its key agencies, it cast doubts on whether the current measures would deliver change at the pace and scale required. Trying to match provision to the needs of the economy, both now and in the future, is clearly not an easy task, particularly in a fast-moving socio-political environment. I have seen the progress on some of the pilots that SDS and the SFC are undertaking and it is clear that there is valuable work and thinking going on in this space. However, having conducted this Review, I too am concerned that the processes in place are not optimal.

2.17 Whilst there seems general agreement that skills alignment is necessary to bring about a more responsive system, I am not convinced that there is yet a collective, shared understanding between partners, including the Scottish Government, of what this means and what it entails in practice. At the heart of this appears to be a fundamental question about what and for whom we are planning and, connected to this, uncertainty about data and intelligence – who has it, who collects it, what it can tell us, who is able to access it and how it can be used to inform decision-making.

2.18 At a national level - a scale at which it is significantly challenging to plan for skills - there is an absence of prioritisation. In an effort to satisfy the wants of every sector, we are failing to plan for those which are most integral to Scotland's current and future success. The result is that issues like the imperative to transition to net zero still feel out of reach as no one is able to articulate the specific skills or occupations that will be required to deliver the policies and programmes that are necessary to meet Scotland's emissions reductions targets. There is also confusion about why some sectors or occupations might be a priority. Without clarity from a national level about which sectors or occupations are a priority and why, investment and resources will continue to be spread thinly within the system. At the same time the 'risk' associated with trying to shape the market is also shared out amongst different actors, making it difficult and unlikely to bring about the transformative shift in delivery that is needed.

2.19 This confusion at national level bleeds into regional structures where there is a similar lack of clarity about what is required and from whom, and a potential case of 'too many cooks' as national and local partners bump up against each other in efforts to identify and plan for local need. Without a collective understanding of the ambition for skills planning, it has been difficult for the Scottish Government and its national agencies to provide strategic direction and then, for want of a better expression, let local actors 'get on with it'. The result is that there is a great deal of activity which is attempting to respond to different place-based needs or sector-challenges, but no clear framework for regional planning which is predicated on local intelligence and empowers (and trusts) providers to work with employers locally to identify and shape provision to meet the needs of the region and to communicate that opportunity to potential learners.

Inconsistency of careers advice and education

2.20 With the complexity of pathways, the lack of understanding of the jobs and occupations of the future and the proliferation of agencies and actors, it is perhaps no great surprise that not all individuals are able to make smart or informed choices about their future careers. This is an opportunity lost. Through a frontline careers service, careers advice and education, decision-making can be shaped and people can be assisted to make choices that can deliver better outcomes for them and for the economy. As directed by Government, there is an emphasis on careers services for those who are at risk of not pursuing education, rather than those who are already on that path. This could imply that those who are headed to college or university, as 'positive destinations', don't need any advice or guidance. However, we know that there are issues of graduate 'overqualification' or skills mismatching^[16]. We have large numbers of engaged learners, but we aren't necessarily equipping them with the knowledge they need to get the most out of their education and, as a result, we aren't using the investment that is going into the system to best effect.

2.21 The same could be said for those looking to change careers or retrain, many of whom can and will be willing to put their own investment into their education, were they clearer of their choices and opportunities. There are issues with the type of provision in the system, in that there is still a lack of short-sharp courses which are suitable for those in-work or who have other competing responsibilities, but there is also lack of clear information about the opportunities that do or will soon exist. Despite the proliferation of web pages and initiatives, I didn't find a single place where I could access all the information I might need to show me the pathways towards a potential occupation, across different providers and the support that might be available, depending on my individual needs.

2.22 Much of what I have heard from business has focused on the current labour market pressures of finding people to work in key sectors including a lack of potential workers from the EU^[17]. This is a concern, as we know migrants who come to Scotland can help to expand our talent pool, raise our productivity and alleviate both skill shortage issues and challenges associated with demographic changes^[18]. On this basis, whilst I understand the focus that careers services and policies have tended to have on young people, it has become equally apparent that there is a clear need to support all learners, including those seeking entry or re-entry to the labour market or indeed to Scotland, with the right advice to move into and develop their careers.

2.23 The work the Careers Services Collaborative will be leading will, I believe, bring some coherence to careers services. However, if we are to get ahead of the demographic issues facing Scotland, it is important that careers advice and education support everyone to understand their learning needs and the opportunities that exist for them in the labour market. Whether real or not, the perception that careers services are for those outside or at risk of falling out of the labour market, rather than everyone who is trying to navigate it, is problematic and damaging. Users that I heard from during the course of the Review, including young people, were clear that the current support is insufficient.

Complicated business interface and clarity of expectation from employers

2.24 If confusion is the experience for potential learners then it is not too dissimilar a story for businesses who seem equally frustrated by the current landscape. I didn't have to look far to find businesses and sectors who were calling out for a greater role in determining how funding should be spent or asking to influence the shape of the pathways to their profession, but struggling to know who the gatekeepers are and how to influence the system. For example, I heard confusion about the role of Developing the Young Workforce (DYW) school coordinators and SDS careers advisors; uncertainty about the processes to join representative boards such as the Scottish Apprenticeship Advisory Board (SAAB), and a lack of clarity on how to influence qualifications. Rightly, industry needs to be able to have a role in shaping the landscape, whether that is in the standards and qualifications that are being developed, the provision that is needed or the advice that is being provided to learners about opportunities. That doesn't appear to be happening to the benefit of most businesses and the evidence suggests that, despite most of the Scottish economy being SMEs, the system has gravitated towards supporting the bigger and more vocal businesses who have the capacity and resources to engage.

2.25 Businesses similarly are unclear about where to go for assistance with workforce planning and this is disconnected from the advice and support that is available for business development and planning. If you ask a group of businesses who they would go to for advice on workforce planning and development, you will get a mix of answers including local authorities, business gateway, enterprise agencies, the Job Centre and SDS. I know there are examples of good practice, for example, in the energy or manufacturing sectors. However, by and large, the processes for integrating skills planning and investment into sector and business development are unclear and inconsistent and opportunities are being missed to incentivise and lever investment from businesses, particularly where government prioritisation or ambition is likely to deliver them growth and profit. If the post-school learning system is to have the capacity and capability to support Scotland's ambitions, then more investment from the private sector is going to be needed. It is just not feasible for a national government and its agencies to provide support to all businesses across all sectors. Nor is it realistic to expect a learning system to turn out workers who have everything they need to perform in the workplace from day one. In this respect, there is a clear role for employers in funding the training of employees, their upskilling and attracting talent.

Summary: the case for reform

2.26 Everything I have set out above points to the need for substantive, structural reform of the delivery landscape including a clarification – and in some cases rationalisation – of the remits and roles of national bodies.

2.27 One of my immediate observations was the division in the system between skills for the economy on the one hand and education for the learner on the other. This division exacerbates tensions, harms the journey towards parity of esteem and, at worst, stigmatises certain destinations for further learning and employment. Scotland cannot afford to allow such preventable harm to continue within its post-school learning system. I believe that we cannot continue to present these as two diametrically opposed and competing ideologies. Skills are quite simply the product of a good education and training system. Education doesn't happen in colleges and universities alone, it also happens in workplaces, in communities and in a multitude of other settings across the country. Skills are both technical and occupation focused, and transferrable and foundational. While we continue to conceptualise this as two opposing and competing systems, each spearheaded by a different public agency that often 'lobbies' for its own part in the system, then we will continue to fail to deliver an 'aligned' system, one which has skills development embedded throughout it and which recognises the broad outcomes and benefits of learning.

2.28 I believe the bringing together of responsibility for skills and education, first under one Minister and now in a Scottish Government directorate is a good first step in addressing this issue, but more is needed if the structures in the system are to be prevented from continuing to feed this divide. In particular, the functions of SDS appeared to be confusing for many people and organisations that I met. I found that it was difficult to characterise or define the body's role as it covered such a wide range of different areas of skills development, including the development of standards and qualifications, delivery and funding of provision, careers advice and guidance, employer support and regional and sectoral skills planning. While these functions are all essential and integrated parts of a 'skills system', they all have different audiences and purposes which make it more challenging for the agency to set out and communicate its overall purpose and performance objectives. In some areas of responsibility, there is, arguably, even a potential conflict of interest through risk of unconscious bias for an agency that is tasked to provide impartial careers advice while at the same time developing, delivering and championing one specific area of provision (apprenticeships). Furthermore, there is a perception that there is overlap between SDS's role and other national bodies, including SFC in relation to skills planning and apprenticeships, Scottish Qualifications Authority (SQA) in relation to qualifications and standards, and the enterprise agencies in providing business support.

2.29 To its credit, SDS has a strong internal culture. Its relationships with its trade unions are an exemplar and it clearly values its own people; providing them with the platform to help shape the direction of the organisation. That is less common that it should be and must be commended. There are excellent examples of its close partnership with the business community, particularly with larger employers.

2.30 However, this spirit of collaboration is not as evident in how the organisation works with the rest of the public sector, with many other agencies commenting on a lack of partnership working and collaborative culture. I have no evidence that this pattern of behaviour is driven by bad intent. It may well be a symptom of duplication of responsibilities and the resulting lack of clarity as to which agency is in the lead for different areas of work. However, whatever the causes, it has exacerbated the lack of joined-up working across the post-school learning system.

2.31 It seems to me that SDS operates first as a business with a remit for engaging employers and promoting apprenticeships or work-based training initiatives, rather than a public body which has a duty to deliver services in line with Ministers' policy ambitions. As such, it doesn't always appear that it makes decisions or demonstrates behaviours which are focused first on public service delivery or the needs of learners. This dynamic is acting as a blocker for partnership working, joined-up thinking and delivery across the public sector. The changes recommended in this report relating to SDS are designed to give the body a crystal-clear focus, in an area of strategic importance to our future post-school learning system, where I believe it can have a transformational impact.

2.32 To conclude my analysis of the current system, I would again point to a crucial asset it has; a shared passion and energy to deliver amongst the people at its heart. However, without change to the shape of the current agency landscape, even with the right policy intent and a clearer leadership, the system is likely to continue to be challenged by the same issues it currently faces.