Leading Change The Learning and Skills Council’s Annual Report and Accounts for 2005-06 2005-06 For individuals and organisations interested in learning and skills LSC Annual Report and Accounts 2005 LSC Annual Report and Accounts 2005-06 1 1 Leading Change The Learning and Skills Council’s Annual Report and Accounts for 2005-06 Ordered by the House of Commons to be printed 17 July 2006. Report presented to Parliament by the Secretary of State for Education and Skills, in accordance with section 28 of the Learning and Skills Act 2000. Accounts prepared under Schedule 1 to the Learning and Skills Act 2000 and presented by the Comptroller and Auditor General. HC 1227 LONDON:The Stationery Office £15.40 2005-06 For individuals and organisations interested in learning and skills The Learning and Skills Council (LSC) helps people learn new skills so that businesses in England can become more competitive. Our job is to plan and fund high-quality education and training for people over 16 in England,other than in higher education. Our 2005-06 budget was £10.2 billion. This report covers the financial year to 31 March 2006.It mainly covers our own activities.A review published in the autumn will report on the broader learning and skills sector for the academic year fromAugust 2005 to July 2006. Throughout this report,financial years are shown in the style 2005-06 and academic years in the style 2005/06. Front cover image:Michelle Jones,Advanced Apprentice,BAE Systems Plc. About us What is the LSC? Page 2 Who we are 4 1 What we do 5 Challenges and opportunities 6 Performance against targets 8 Overview The benefits of change Page10 Chairman’s statement 12 2 How we spent our money 13 Chief Executive’s review 14 agenda for change 16 Management commentary Managing How we manage the LSC 20 responsibly Our non-executive members 22 How we take care of our people 24 Page18 Sustainable development 26 Local area performance 28 3 Financial commentary 34 Remuneration report 36 Statement of responsibilities 42 Accounting Officer’s statement 43 Finance Funding Success Page 46 Auditor’s report 48 Accounts 49 4 Annex A 75 Further information 77 List of related documents 78 2 1.4m 1.5m Our main task is to make sure that Last year,there were a record 1.5 the nation’s 1.4 million employers have million young people in learning. the skilled workforces they need to compete effectively at home and abroad. More about our role: More on performance: 1 pages 4–5 page 8 About us LSC Annual Report and Accounts 2005-06 3 1 What is the LSC? 4 Who,what,where,when... New role 300,000 Growing confidence The Department for 150 000 The means-tested LSC staff survey finds Education and Skills The Employer Training Pilots now Education growing confidence in transfers the Learner involve over 30,000 employers and Maintenance the organisation and Support Directorate Allowance encourages its management. to us. 274,314 employees of whom 148,884 300,000 young people More on communication have already gained a qualification. to stay on in education. and consultation: page 24 April 2005 May 2005 Who we are We were set up in 2001 to plan and fund high-quality education and training for everyone over 16 in England,other than in higher education.Our goal is to improve the nation’s skills to match the best in the world. How we work Trust Expertise By 2010, we want the nation to have a If we are to be world class at working We show expertise and true leadership truly competitive,world-class workforce. in partnership, trust must be at the heart in every aspect of our work.We fully To achieve this, we work with further of everything we do. understand the needs of the communities education (FE) colleges, school sixth we serve, of employers and of forms, sixth-form colleges, higher Ambition individuals in education and training. education institutes and other training We are ambitious for ourselves in the organisations.We help them to plan goals and aims we set.More importantly, Urgency their work, we provide their public we are ambitious for the communities We want to bring urgency to the funding, and we help them to achieve we serve, for employers and for learning and skills sector, to tackle excellence in the way they are run and individuals in education and training. long-standing issues quickly and the learning they deliver. professionally, and to be responsive and fast moving. Our work is driven by the needs of the country’s employers.We work closely with them to identify existing skills gaps, understand what skills they will need in future, and make sure that the right education and training resources are in place.We also take account of the needs and wishes of individual learners, and encourage their appetite for further education and training. We work at national, regional and local level from a network of offices across the country.We cannot do our job alone, and we work with many other organisations, as well as employers and learning and skills providers. More on partnerships:Chief Executive’s review, page 14. To help us do our job successfully, we have identified four values that govern the way we work. More on our role and strategies,visit our website at: www.lsc.gov.uk LSC Annual Report and Accounts 2005-06 5 1 Faster change Top Apprentices New finance Director Skills Summit At a learning and skills 89% The second annual We appoint Richard We host a national sector conference,LSC Our learner satisfaction survey finds Apprenticeship awards Healey as our new event for employers Chief Executive Mark take place at London’s Finance Director. and our partners who Haysom calls for faster high satisfaction among learners – 89% Hilton Hotel. are interested in skills change to meet a are in FE colleges,90% are in work- and developing their tougher funding based learning,and 91% are in adult workforce. environment. and community learning. June 2005 July 2005 What we do We have been given a clear framework for action by the Government’s 14–19 and Skills Strategies,the Youth Green Paper and the new FE White Paper.Our plans for achieving the Government’s vision are set out in our Annual Statement of Priorities. Our strategy for action Priority 1 Priority 2 The challenges and opportunities we Make learning truly demand-led so that Make sure that all 14-to 19-year-olds face are set out in the next two pages. it meets the needs of employers,young have access to high-quality,relevant Each year we publish an update on our people and adults more effectively. learning opportunities. most important goals and how we aim to achieve them, in our Annual Priority 3 Priority 4 Statement of Priorities. Our priorities Transform FE so that it attracts and Strengthen our role in economic are outlined on the right. encourages more business investment development so that we provide the skills in development,training and skills. needed to help everyone find work. Our goals are ambitious. Neither the learning and skills sector, nor the LSC, Priority 5 Priority 6 can achieve them unless we all act Strengthen our ability to work effectively Improve the skills of the workers who together to change ourselves and the at a regional level – particularly with are delivering public services. way we work. So, working closely with Regional Development Agencies and the sector, we have developed our Regional Skills Partnerships. agenda for change programme.This sets out the changes that are needed to achieve world-class delivery of learning and skills and make sure that every penny possible is directed to the front line. More on agenda for change: page 16. To view or download our Annual Statement of Priorities,visit our website at: www.lsc.gov.uk 6 Challenges and opportunities Marking Mark All change LSC streamlining Skills gaps closing As part of the Black The agenda for change Theme 7 of agenda for The national Employer Leadership Initiative, prospectus sets out the change begins the LSC’s Skills Survey shows two college deputy programme of change transformation into a skills gaps are closing principals work- for the learning and more streamlined and and employers are shadow our Chief skills sector. dynamic organisation. increasing training Executive Mark More on page 16 More on agenda for budgets. Haysom. change:page 16 August 2005 September 2005 We work with four groups who we see as our main ‘markets’– employers,young people,adults,and the colleges and other education and training providers that we fund.Each of these groups presents particular challenges and opportunities. Employers Our National Employer Service provides The big challenge is to attract more Our main aim is to make sure that the a similar service for large companies.And people from the difficult ‘not in country’s employers have the skilled Apprenticeships provide a popular option employment,education or training’ workforces they need to compete for on-the-job training. (NEET) group. effectively at home and abroad. We continue to increase our involvement Main risks: Failing to attract more young Challenges and opportunities with employers,and to get them more people in the NEET group and failing to Our challenge is to help raise the nation’s involved with local colleges and training deliver a curriculum that is broad and position among the world’s most providers.Our National Employer diverse enough in all areas.By law,we productive and competitive industrial Skills Survey found that 82 per cent of have to fund education for everyone economies.We have the opportunity to employers using FE colleges were satisfied in this group who wants it and,as we do this by filling skills gaps and helping with the service.Of those,43 per cent attract more people,costs are rising to build a workforce with world-class were very satisfied.