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FEfocus Editorial - Baffled by the great funding unknown

In his famous incursion into philosophy, former US defence secretary Donald Rumsfeld took a break from ordering aerial bombardments to ponder the nature of knowledge. "There are known knowns; there are things we know that we know," he said. "There are known unknowns; that is to say, there are things that we now know we don't know. But there are also unknown unknowns; there are things we do not know we don't know."

Well, after two hours of questioning, the business, innovation and skills select committee mainly helped to increase the category of known unknowns in relation to FE funding (p3).

The claim by David Willetts, the universities minister, that only 10 per cent of provision across the whole department will be lost, despite cuts that are much greater than that, relies too much on these unknowns to be relied upon.

In his own domain of higher education, it assumes that no students are put off by the prospect of high fees and 30 years of repayments. While Lord Browne's proposals are arguably more affordable for students than the status quo, thanks to a rise in the threshold for repayments and a longer repayment schedule, it seems entirely plausible that some will baulk.

Much the same is likely in FE, when over-25s face taking on a pound;3,000 debt, just to get themselves qualified enough to be able to go pound;30,000 further into debt. It may be a good deal in the long run, but not everyone will see it that way.

We do not even know how many of these loans will be available and one suspects that any figure produced will be largely a work of fiction. Who can tell precisely how many over-25s taking level 3 qualifications will earn more than pound;21,000 a year? If we do not know how much will be repaid, it is impossible to accurately price the cost of the loans to Government.

Added to this are the cuts to Train to Gain, where a replacement work- based programme is promised, but it is unlikely to offer 90 per cent of the 800,000 places provided last year.

So all of this is to say that Mr Willetts's broad pledge that only 10 per cent of activity is being cut must have been made in a spirit of extreme optimism, at least as far as FE is concerned.

But the biggest gap remains the lack of a plan to ensure business investment in training. Business Secretary Vince Cable talked hesitantly about licence to practise, but that puts barriers to entry in certain jobs without really supporting training itself. The talk of voluntary levies in the spending review has disappeared without leaving a trace.

The debate is sometimes framed as if businesses are being asked to bail out the Government by using private money to cover for spending cuts, as people ask, how can we get employers to invest in the apprenticeship programme?

Really, the opposite is true: Government invests hugely in training designed by employers to meet their own needs. It is time businesses were forced to take up the slack.

The coalition Government has seen its Conservative elements abandon a few right-wing totems, ditching "prison works" and worrying about how "progressive" it is. Is standing up to the special pleading of business really a step too far?

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