UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 26-ii

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

WELSH AFFAIRS COMMITTEE

CROSS-BORDER PROVISION OF PUBLIC SERVICES FOR WALES: FOLLOW-UP

Tuesday 1 December 2009

MS JANE HUTT AM and DR DENNIS GUNNING

Evidence heard in Public Questions 1 - 34

USE OF THE TRANSCRIPT

Oral Evidence

Taken before the Welsh Affairs Committee

on Tuesday 1 December 2009

Members present

Dr Hywel Francis, in the Chair

Nia Griffith

Mrs Siān C James

Mr David Jones

Mr Martyn Jones

Alun Michael

Hywel Williams

________________

Witnesses: Ms Jane Hutt, Assembly Member, Minister for Children, Education, Lifelong Learning and Skills, and Dr Dennis Gunning, Director, Skills, Higher Education and Lifelong Learning, Welsh Assembly Government, gave evidence.

Q1 Chairman: Bora da, good morning, and welcome to the Welsh Affairs Committee in its inquiry into the review of cross-border further and higher education provision. Minister, could you introduce yourself for the record and obviously your colleague, please.

Ms Hutt: Thank you very much indeed, Chair. I am Jane Hutt, the Minister for Children, Education, Lifelong Learning and Skills, and this is Dr Dennis Gunning, who is the Director of Skills, Higher Education and Lifelong Learning in the Welsh Assembly Government.

Q2 Chairman: Thank you very much and thank you for all the preparatory and background papers that we have received from you and your colleagues. We are also very conscious that very recently you made a statement at the National Assembly for Wales on the 21^st-Century Higher Education Plan and, whilst we would not wish to start with that, we would be very keen to weave in some questions on that very important policy development which you outlined. In the wider context, in examining cross-border issues, could you tell us, are you satisfied that the Welsh perspective is properly taken account of by the UK Government with regard to policy decisions on higher education, research and further education? This was clearly an issue for us in our earlier inquiry.

Ms Hutt: Well, thank you very much indeed for that opening question because certainly, looking back since your inquiry, an awful lot has happened over the last year and indeed happened at UK Government level and indeed happened in terms of the preparation and delivery of the Higher Education Plan and Strategy, which I published last week, For Our Future, with a statement to the Assembly. I think that the written evidence that was given in fact in February of this year, which was a full response, did indicate a close working between, at that stage, DIUS, and of course it is now DBIS, and my Department, DCELLS. In terms of the changes which have developed now with DBIS coming into place, again the progression in terms of high-level policy linkage, I am very pleased to report, has been reinvigorated and, in terms of the shape and direction for our future, fits very well alongside Higher Ambitions which of course is the DBIS/UK Government's policy direction and framework. In terms of the integration and the drive for high-policy liaison, I can use the example of the ways in which we have worked together in terms of DCELLS and DBIS officials on the two documents that brought together For Our Future and Raising Higher Ambitions because our officials worked very closely together to ensure that there was synergy, and we have also engaged, for example, in the review of postgraduate provision, the Smith Review, and it was very important again to ensure that we were securing the most advantage in terms of research opportunities and access to research. I think you can look from higher education to high-level skills provision to a great deal of close working and I think that has delivered better liaison and better recognition of Welsh needs in terms of all the cross-border issues. I myself have had regular discussions and meetings not only with John Denham formerly, the Secretary of State in his former DIUS position, but also with David Lammy as Minister for Higher Education in DBIS. Indeed, we only had a discussion yesterday and earlier on in the autumn about the importance of the linkages and the synergy, particularly where DBIS has UK responsibilities relating to research, in particular, as well as issues around the cross-border responsibilities for higher and further education, so I do believe liaison, synergy, policy and planning have been strengthened over the past year considerably.

Q3 Chairman: I am very struck in your long answer, which was very comprehensive, that it missed out several key players, key players who attracted some criticism when we published our last Report. First of all, the role of the Wales Office, and you have not mentioned that, has that role changed and improved? Secondly, the role of the Funding Council, has its role changed and improved? Also, we have the arrival of the regional ministers and you did not mention that at all. Do you have any engagement with them?

Ms Hutt: I do not think there has been any difficulty since I have been Minister for Education in terms of links and liaison with Wales Office ministers, and clearly in regular meetings, and I had one yesterday with your Minister, Wayne David, higher education was on the agenda, as it has been with former ministers, and indeed the Wales Office is clearly factored into information briefing as and when requested in terms of higher education. The Funding Council, obviously HEFCW serves us and we are working very closely with HEFCW, I think the Funding Council synergy is very robust and it also meets with the Wales Office. In terms of regional ministers, no, I have not had meetings, I have not had calls or invitations to meet with regional ministers, but I am sure that could be on the agenda.

Q4 Hywel Williams: Good morning, Minister. I am glad to hear you say that communication has improved, which has been one of the concerns that we have had. In fact, Higher Education Wales have said that, in their opinion, things have improved substantially. It is one of the criticisms of this place in questioning ministers whether they are relating to England or to the UK, and I do not know if you want to comment on this, but it is one of the problems with statements from DBIS, as it is now, but also can you just confirm that within the structure of consideration within DBIS the structures which are devolved are always routinely considered?

Ms Hutt: Certainly routinely considered. Indeed, I have talked quite a bit about higher education, but we must remember that we are closely involved in, for example, the UK Commission on Employment and Skills and that is an active engagement, and Sir Adrian Webb sits on the UK Commission and plays an active role, not just on behalf of Wales, but on behalf of the UK Commission, so that is one example. Clearly, the close working relationships that we have developed, I mention not only HEFCW, but in terms of ministerial contact and cross-border issues we come on to, for example, research initiatives where universities in Wales and across the border in England are working very closely on research collaboration.

Q5 Nia Griffith: Minister, you are obviously, I am sure, very, very well aware of young people who are looking towards which university they might go to and how important it is for students on both sides of the border to look at the full range of options. I would really like to ask you what sort of input you are expecting to have into Lord Browne's review on student fees because, quite clearly, although they have an England remit, there will be a huge knock-on effect on students in Wales.

Ms Hutt: Of course we have made our own changes in terms of student finance, as you know, Nia, and that has been very important in terms of seeking ways in which we can redirect finance to higher education and also have more equitable and fairer arrangements in terms of our student finance. We will look with interest to the outcome of the Browne Review in terms of fees and funding. It is an independent review and again it was the subject of a discussion with the UK Higher Education Minister yesterday, and we of course will look to that in terms of any impacts it might have on Wales, and our officials are engaged, but at this stage I think it is appropriate just to ensure that we are closely linked to being able to give evidence and observe the developments with the review.

Q6 Hywel Williams: Minister, can I ask you a question about consideration given to Welsh health policy where I think we have a very progressive Welsh health policy now emerging from policies elsewhere. Higher Education Wales has questioned whether Welsh health policy is properly taken into account by the Office for Strategic Co-ordination of Health Research and the Office of Life Sciences. Are you satisfied that there is sufficient Welsh policy input into these organisations?

Ms Hutt: Well, thank you, Hywel. I think the needs of policy development in Wales are now fully taken into account by both the Office for Strategic Co-ordination of Health Research and the Office of Life Sciences. We did make the commitment, Welsh ministers made the commitment, to the OSCHR membership and to fund an expansion of R&D in Wales, and we have become the first devolved administration to actually take on that partnership role. That should result in a more efficient use of public funds, but also an improved environment for R&D and, most importantly, benefits to patients and the NHS, so I think both the partnership with the Office for Life Sciences and indeed the Office for Strategic Co-ordination of Health Research are key developments and, as you say, they are supporting an expansion in terms of health policy and research opportunities.

Q7 Mrs James: Good morning, Minister. Turning to higher education funding, the HEFCW Funding Gap Report indicates that universities in Wales received 15% less investment per student in 2006/07 than universities in England and that the cumulative level of the higher education investment gap since it emerged in 2002 is now around about £250 million. Is it your intention to close this gap, both in terms of future annual spending and in terms of the cumulative investment gap?

Ms Hutt: Thank you very much, Siān. I think that, if we put into context the spend on higher education in Wales, overall the Welsh Assembly Government funding for higher education has increased by over a third in eight years from around £335 million in 2002/03 to over £460 million in 2009/10, so that is a one-third increase in eight years and, if you take together the level of higher education institution funding and student finance, it is on a par with English levels. In 2009/10, the Welsh Assembly Government made available over £460 million to higher education institutions by HEFCW, but, in addition to this, we have £373 million via student finance, so it is important that we look at the whole picture in terms of the funding elements and the comparability with higher education funding in England. Also, we must take on board capital funds, and you will be aware, I am sure, that we brought forward capital funds and that was part of our counter-recessionary interventions to support our universities, and this, for example, in terms of bringing forward £5 million within our £25 million capital expenditure fund for this financial year has been very beneficial. Also, indeed we have got not only a new Matched Funding Initiative, and I think you took account of that in your most recent review, the fact that we have introduced the Matched Funding Initiative, but also an Economic Support Initiative which is also benefiting higher education. Importantly, I have mentioned the reform of student finance and, if you recall, in terms of that reform of student finance, it was with Professor Merfyn Jones in phase one of his review where we came to a view that we needed to change student finance. This is going to result in a contribution to higher education in excess of £31 million per annum by 2015/16 and the funding from that redirection with the phasing out of the tuition fee grant starts from the next academic year and is going to help us fund and underpin our new Higher Education Strategy and Action Plan, For Our Future, so not only is it on a par with English levels in terms of spend, but we have made a very brave decision, I think, to redirect student finance into higher education and that is going to rise to £31 million per annum, as I said, from 2015/16.

Q8 Mrs James: I think the main cause of concern that I have is that Higher Education Wales has received all of this information obviously and has welcomed it, but they are still worried that the investment in comparison to Scotland and England is still way below it and it is falling short, they are claiming, of the investment made in universities in those countries, so how can we reassure people that that is not so?

Ms Hutt: I think again we do need to give the facts and figures and the statistics. I think Higher Education Wales and indeed HEFCW, in our discussions, recognise this. If you look at HEFCW's calculations, Wales actually invests more in higher education per head of population than England, and that is £143.50 per head of population in Wales compared with £141.90 in England. I think the issue we have got to face is in terms of the resource sources for higher education, it is not just the public sector, and I have mentioned the fact that we have brought in a Matched Funding Initiative which has been widely welcomed by higher education institutions, but certainly, when I attended the launch meeting of that recently, it was quite clear that Wales's HEIs were way behind comparisons of HEIs in England which had made great use of the Matched Funding Initiative and now Higher Education Wales are ready to rise up to the challenge with the Matched Funding Initiative. It is true that Welsh higher education is more reliant on government funds than the English sector, and I will not give you more figures on that, but I would say that another source of funding which has been very important for higher education in the past year has been the European Structural Funds and over £80 million has been levered in.

Q9 Mr Martyn Jones: You announced in July the launch of a matched fundraising scheme. There is some concern that that might be financed by top-slicing. Will any new money be provided for the matched fundraising scheme?

Ms Hutt: Clearly, our allocation of funding to HEFCW to enable it to then support our higher education institutions in Wales included funding that could be allocated for the Matched Funding Initiative. This goes to higher education institutions. It might go through a different source, but it is from the public purse. I have already talked about the opportunities that this Matched Funding Initiative will offer and I think higher education institutions are up for it and are very pleased that we now have this matched funding opportunity.

Q10 Alun Michael: Can I follow through on this because I do not want us to sound critical because you inherited a very serious problem in terms of higher education funding, but the funding gap is big in comparison to England and even bigger in terms of comparison with Scotland. The fundraising initiative has been widely welcomed, as you say, but obviously the capacity of different institutions to make use of that will differ according to the nature of some of those which perhaps are dealing with the students who are not natural candidates for higher education, but who are perhaps the ones who need more resources and may find it more difficult to make use of that. If we go back to the comparison of the funding gap, bearing in mind that you mentioned capital being brought forward and of course happily is being brought forward in respect of English institutions as well, the gap was £70 million in 2005/06 and £55-66 million was the estimate for what it was in 2006/07, and that seems quite a wide range, but those are the figures that HEFCW has given us, and then £69 million, so up again, in 2007/08. What is actually the funding gap in terms of 2008/09, 2009/10 and what will it be for 2010/11?

Ms Hutt: Well, I appreciate that the funding gap has been a major issue which, as Minister, I have been seeking to address, and I think the redirection of student finance has been a major policy provision which is going to enable that year-on-year investment in higher education as a result of redirecting student finance and introducing the Matched Funding Initiative. If you look at the latest HEFCW analysis, it does show a narrowing of the difference in terms of the alleged funding gap, although I will not go back over the actual comparability in response to Nia Griffith's question because I do believe that you have to look at what are we spending per head of population in Wales and what are we spending per head of population in England and it is on a par.

Q11 Alun Michael: Forgive me, but what we are spending may be comparable, but, if you look at it in terms of the money available to higher education institutions, which is the money they have to use in order to be able to compete with equivalent institutions across the border or in Scotland, then that funding gap is very real. There may not be the same spending gap, and I appreciate the difference, but can we just concentrate on the funding gap. As I say, those figures showed it actually increasing from 2006/07 to £69 million in 2007/08, so what will be the funding gap for higher education institutions in Wales, what will it have been in 2008/09 and 2009/10, and what will it be in 2010/11?

Ms Hutt: As far as I am concerned, having dealt with a very difficult budget in this financial year in terms of the whole picture, the whole of my portfolio, I have sought to protect higher education, and certainly I think that the commitment I have sought and succeeded in gaining from the Cabinet, the Government, and the Assembly to redirect that funding demonstrates that I want to address the funding issue in terms of higher education institutions in Wales. I cannot give you the exact figures because I think there is a recognition certainly with HEFCW that we need to move on with the plan that I announced last week, For Our Future, with the opportunities that we have got from the redirection of funding from the student finance arrangements, with the Matched Funding Initiative and with the funding that also we are levering in from the core capital budget because, and I appreciate money was brought forward in England as well as Wales, but from the core capital budget in the Assembly I have brought forward funding £16.5 million for, for example, IBERS in Aberystwyth.

Q12 Alun Michael: I am sorry, but I appreciate that you have got a very difficult job and in budgetary terms, as a Minister, it is a bit of a nightmare. I have had that experience and I know what it feels like, but it is a very, very straightforward question as to what the funding gap was in 2008/09, 2009/10 and what it will be in 2010/11 and, if you feel that you need notice of that question to be able to answer it in those terms, I would like to ask that you write to the Committee to spell that out for us because it is a significant fact as far as the institutions are concerned in trying to compete with institutions across the border and, therefore, it is very relevant to our inquiry.

Ms Hutt: Well, I am certainly prepared to write back in terms of estimations of funding gaps. I would like, with your permission, Chair, also to be able to give information on the other sources of investment, including European funding and including the Strategic Capital Investment Fund to enable us to see the whole picture in terms of public investment in higher education in Wales.

Q13 Alun Michael: If you can answer the specific question as well as provide that supplementary information, that would be most welcome.

Ms Hutt: I would be very happy to do that.

Q14 Hywel Williams: Can I just ask you about matched funding, Minister, and this is a question about your judgments rather than the facts of the matter. How confident are you in the ability of the various institutions in Wales to take advantage of this scheme? I am concerned that perhaps the better-found institutions will be more able to take advantage, that those that have will be given and those that have not will still be struggling.

Ms Hutt: I think the Matched Funding Initiative was warmly welcomed by all our vice-chancellors, for example, in terms of their opportunities to increase and expand fundraising capacity and also obviously incentivised voluntary giving. We have some very wealthy alumni from Wales and I think we have not attacked that source efficiently and effectively, and I am sure that many of you will know, those of you who are graduates from universities, I am sure, across the UK will have had the regular requests for support, but we have not had vigorous, for example, alumni-giving arrangements and many universities are now taking this up. I do believe that for universities, for example, the University of Glamorgan, this is about ensuring that fundraising capacity can be matched where you can bring in private sector funding support, and there is recognition across the board in Wales that this will be internationally focused as well as nationally focused and it will, I think, provide new opportunities, but, I must say, the Matched Funding Initiative is not the only route obviously in terms of their opportunities to expand the business base. I think higher education institutions do have leverage for resources, and I have mentioned European funding and I am going to give more in the supplementary to the response to Alun's question about the funding gap, and I will be able to give you more examples of the ways in which they can bring in funding, but I think research councils are obviously one source which, I am sure, you will want to question me about.

Q15 Mr David Jones: How does the Assembly Government propose to increase the economic contribution that higher education makes?

Ms Hutt: Thank you very much, David. This was really the key focus of For Our Future which I published last Wednesday, the twin goals of developing a buoyant economy and promoting social justice. Those were the higher education priorities that we focused on as a result of For Our Future, and the key role that higher education can play as a contribution to the economy has also come over very clearly in the Assembly Government's response to a committee report on this matter, the Enterprise and Learning Committee's Report on the economic contribution. In terms of the knowledge economy, in terms of the outputs in terms of research investment and the opportunities that we now have as a result of For Our Future to bring together much more clearly higher education, further education and employers to raise higher skills levels in Wales, I think the challenge is quite clear, it fits with the Lisbon agenda and it is an opportunity for business to engage. I think we need to see that business is much more central to the mission and objectives of higher education, and I think that the creation of many more part-time, work-based programmes and foundation degrees which make it easier for students of all ages to access higher education, concentrating on research funding, securing critical mass and collaboration in terms of world-class research, are all part of the ways in which we believe that higher education in Wales can benefit the economy.

Q16 Mr David Jones: For Our Future is quite a radical document and there have already been some mutterings that it is actually changing the relationship between the Assembly Government and the academic institutions. You talk in terms of creating a national higher education system, there will be job-planning and delivery in the new HE system and your ambition is fundamentally to remodel higher education in Wales. You also indicate that your plan recognises and respects the autonomy of higher education institutions, and then it goes on to say that the Assembly Government will be using HEFCW as a lever, effectively, to impose policy on those institutions. Would you regard the model that you are proposing as a dirigiste model of education?

Ms Hutt: I am glad you have described For Our Future as a radical document. I would say that it has very clearly followed the recommendations from Professor Merfyn Jones, phase two of his review into higher education, and to recognise that the twin goals of promoting a buoyant economy and social justice are very much the themes of Merfyn Jones' review. Indeed, I think the relationship, the development of what has been described as a 'compact' between the Welsh Assembly Government and higher education, that was a concept and a recommendation that came from Merfyn Jones' review. The meeting that I have had with vice-chancellors and with Higher Education Wales and indeed the chairs of governing bodies last week was very positive and the response that I have had to For Our Future from last week has been very positive indeed. There is a recognition, and it is quite clear in my report, that higher education institutions are autonomous, but they do also have to be accountable for over £400 million of public money and it is in the recognition of that relationship which we need to build that we have developed this concept of a compact. I said to the vice-chancellors and to the chairs of governors last week, "We want you to deliver with us this Higher Education Plan". This is about a step change in higher education for Wales which will ensure that our investment delivers for the economy and for widening participation, but it does mean that the relationships that exist and are very constructive between higher education institutions will not just be on a research level, but they will also be looking at how we can deliver high-level skills, and that does mean closer working with further education institutions. It is very good and another great development in the last few weeks is the fact that further education colleges have now got foundation degree-awarding powers, and that is something which higher education institutions respect in terms of the strategy that we are developing with higher education institutions in terms of the development of the economic contribution of higher education.

Q17 Mr David Jones: Do you not think in reality that it is disingenuous for you to claim that this policy document actually does respect the autonomy of HE institutions when you use language such as this: "In future, public funding investment in higher education via HEFCW will be steered towards investing to achieve the changes necessary to meet our vision and expectations. Only institutions that can deliver those priorities can expect to be beneficiaries"? It is effectively a case of he who pays the piper calls the tune, is it not?

Ms Hutt: Well, I mentioned the accountability as well as the autonomy of our higher education institutions. I do believe this is a shared vision. It is a shared vision and also I would go back to the fact that For Our Future was very much a government response to Merfyn Jones's review and it took on board the fact that in terms of the needs of Wales we needed to look at the economic contribution of higher education. I would also say in terms of the widening participation and indeed the research priorities that we have now established that we have been very clear and higher education institutions have welcomed the clarity of both the Assembly Government's steer on research priorities because that is the way they will succeed in terms of accessing our further research council funding, so very clear about the fact that we have those priorities, but also that we have invested in, for example, the University of the Heads of the Valleys where there is a huge disparity which was acknowledged and highlighted by Merfyn Jones between, for example, the skills level of people who live in Blaenau Gwent and people who live in Monmouthshire. That had to be addressed and higher education has risen to the challenge and indeed the University of Glamorgan and the University of Wales Newport are now together in alliance, delivering on the Heads of the Valleys University Initiative.

Q18 Mr David Jones: I would like to turn now to collaboration between England and Wales in terms of HE. I take it you would regard cross-border collaboration as a matter that should be encouraged?

Ms Hutt: Yes, of course, naturally.

Q19 Mr David Jones: Would you acknowledge that, given Lord Mandelson's policy document, cross-border collaboration is all the more important?

Ms Hutt: Clearly, and I can give examples, for example, of where we are fully engaged, such as the Severnside Alliance for Translational Research, for example, in terms of the involvement of WORD, our Wales Office research and development, and also Bangor University working very closely with the bilingualism in terms of Reading University, the Bristol-Cardiff Neuroscience Collaboration, and those are just some examples of the collaboration at the research level.

Q20 Mr David Jones: At the moment, Wales is only receiving about 3% of research council funding that is distributed in the United Kingdom. That is right, is it not?

Ms Hutt: Yes, that is correct.

Q21 Mr David Jones: That must clearly be a matter of regret, I would have thought, to you. Would you agree, again given Lord Mandelson's policy statement, that cross-border collaboration is going to be all the more essential to the Welsh universities if they are to expand and maintain a vibrant research base?

Ms Hutt: I think that what we need to move on is all fronts. Certainly, in terms of strengthening Wales' research capacity, some of that will be in terms of cross-border collaboration, and I have mentioned two or three examples, but it will not all be about cross-border collaboration and it will be about strengthening our own research capacity and being clearer, as I have been, in terms of the priorities. Now, having set those priorities, and I will just repeat them, the digital economy, a lower-carbon economy, the health and biosciences and advanced engineering and manufacturing, we have those priorities, we have also ensured that our universities are working much more closely together in terms of peer review, there has been a great deal of work bringing UK research councils to Wales to make sure that our universities are clearly geared up to the opportunities to collaborate, and indeed we have some excellent examples of that collaboration coming through. Yes, we have internationally recognised, world-class research in Wales and we need to strengthen that, some of it cross-border, but much of it will be through collaboration, and the same message, I am sure, will come from the UK Higher Education Minister.

Q22 Chairman: I am conscious of time, but, before we move on to research funding, could I just pursue this question of collaboration. I was struck by statistics published by the Universities and Colleges Union recently about the percentage of the population in particular boroughs across the United Kingdom enjoying the benefits of higher education, and that the Rhondda, and I assume they mean Rhondda Cynon Taff, the percentage there is declining in stark contrast to areas like London where it is dramatically rising, and there are all kinds of factors in play there, I am sure. However, on the question of collaboration, I am struck by, and I warmly applaud, as this Committee does, I am sure, your statement about the need for higher education being opened up to many more people through significantly greater diversity and flexibility in programme design, et cetera, emphasising the importance of part-time higher education, and I certainly warmly welcome the example of the University of the Heads of the Valleys Initiative, but can we be assured that what appears to be free money being given to those two institutions is being monitored carefully, particularly with regard to collaboration within Wales of those institutions with those institutions which have an excellent track record, like the Open University? Would the Open University be used in a collaborative way by these two institutions, and also would these two institutions which have this money for the Heads of the Valleys look at best practice elsewhere, such as Birkbeck College, which is on a par with the OU in terms of its track record on part-time higher education, and also internationally by universities, like the South Bank with its work in South Africa? Can we be assured that these two institutions, Newport and Glamorgan, will benefit from the good practice elsewhere?

Ms Hutt: Certainly, I can assure you of that, and we have got excellent, outstanding work in Wales, as you know, and you have certainly been involved in that yourself in your former role in the Community University through Swansea University, so widening access and the investment that we have placed into that in terms of flexible learning opportunities, outreach and progression have been a key part of the agenda, but I think that we are now moving on in terms of not only the collaboration between the Universities of Glamorgan and Newport, and the Open University clearly will have a role in that, but I think the University of the Heads of the Valleys is about a £10 million revenue investment which we have agreed over the next four years. It is primarily focusing on Level 4 and above and it is about access relating to work-based learning and foundation degrees, but it is going to be non-conventional in terms of ground-breaking provision. I would also want to mention that the University of Glamorgan is leading a £34 million work-based learning programme, backed by EU funding, and that is about flexible, bite-sized learning, tailored to workplace needs and up to 8,000 employees from West Wales and the Valleys benefiting, so we are moving ahead in terms of the opportunities for part-time learning, for flexible learning and for progression opportunities, and it has to be done in partnership, but certainly there are also institutions and governments looking to us as well as us looking out internationally and nationally to expertise on this front. The University of the Heads of the Valleys Initiative is something which has attracted, for example, interest from New Zealand.

Q23 Mr Martyn Jones: Minister, you mentioned before some measures that you were using to attract more research council funding to Wales because of our low share, I imagine. Can you say whether they are working or not, and is there anything else you would like to add to the list?

Ms Hutt: Thank you, Martyn. Just in terms of the income from research councils, it has risen from £23 million in 2001 to £44 million in 2007/08, but it has stayed, as I acknowledged, at around 3 to 3.5% in recent years. It is important that we recognise that the measures that we have taken, like, for example, IBERS in Aberystwyth, have brought in the funding from the research council which relates to the environmental science, and now in terms of international opportunities that is bringing in other research, not only from the research councils, but also from the private sector, so, for example, Waitrose is one of the private sector partners funding the IBERS as well. I do believe that the work we are doing to bring not only our research priorities - I will not repeat myself - but bringing together the Pro-Vice-Chancellor Research in Wales and to drive also the opportunities to look at ways in which we can use European funding as well as research council has been very beneficial.

Q24 Mrs James: Given that we need to grow the share of research council funding and that Welsh higher education institutions are starting from a lower base, especially in respect to STEM capacity, how are we going to do it?

Ms Hutt: I think the measures that we have already instituted in terms of being clear about priorities, being clear about the mission and purpose of universities in terms of their strengths and also seeking collaboration between universities in terms of research base and excellence is the way forward, but I think you have only got to look at some of the most recent developments, like the Institute of Live Sciences in Swansea, which you are very well aware of, which really put us at the forefront in terms of a world-class research hub with that infrastructure. If you look, for example, at Cardiff and Glyndwr Universities' pioneering centre in relation to excellence in leadership management skills, it is collaboration that is going to deliver. Aberystwyth University has just had the Queen's Award for Excellence for IBERS for the work that they have done, and that is going to be internationally recognised in terms of the delivery. A total of £55 million of course has been invested into IBERS, so at every front it is priorities which we set, it is collaboration, it is ensuring that there is a critical mass and I think it is fostering excellence where I was very appreciative of the point that you made in your Report, initially anyway, about the need for us to foster excellence as well as follow it.

Q25 Chairman: You mentioned some excellent examples. Would you like to say something, particularly in relation to science, technology, engineering and mathematics, about the proposed new campus bordering Siān's constituency and mine, but actually located in my constituency, I believe, and the support the Welsh Assembly Government is going to be giving to that?

Ms Hutt: I think you will have welcomed certainly the focus on STEM in For Our Future, which was clear in my statement last week on the importance of the STEM subjects, the fact that we are creating a National Science Academy, and also that we have been discussing not only with Swansea University, the Vice-Chancellor, but with other universities about how they can progress in terms of their contribution and, I do believe, now the discussions that are ongoing in terms of the opportunities, for example and it is only one example, of a second campus in Swansea.

Q26 Nia Griffith: The Minister has covered a lot of the ground I wanted to explore, but perhaps I could just go back to the document Higher Ambitions and this idea of centralising research, and, in many respects, we know that has happened over the years anyway. Apart from collaboration, which is obviously a key way forward, in what ways are you making sure that we are keeping that channel of communication open with DBIS and making sure that we have dialogue from the beginning right the way through? Also, in terms of actually getting funding coming to Wales, is there going to have to be a concentration on a very specific sector, if you like, a specific area of excellence, and would that be to the detriment of other areas?

Ms Hutt: I think, as you say, Nia, and I have responded to many of those points, but we have moved on so far in the last six to nine months in terms of clarifying priorities and making sure that we have the greatest strategic use of funding, that we focus on building research capacity to maximise participation and to link it of course to knowledge exploitation for the economy. We are much clearer about the purpose and mission and I think that is why our higher education institutions have moved on as well. I think they welcomed our statement last week and we engaged them in an external reference group and we are going to engage them in the delivery implementation, and that is why we want a compact with our higher education institutions, but the point about the working and the liaison with DBIS, it is not contradictory, it is complementary in terms of our working together, and I think the greater collaboration and co-ordination that we see, and it will include cross-border collaboration, will set out very clearly the way in which research can be delivered to that world-class excellence.

Q27 Nia Griffith: Can I perhaps follow that up with a question about the Technology Strategy Board and whether you feel that the Welsh Assembly Government has got the right rapport and the right opportunities to have some influence there?

Ms Hutt: The Technology Strategy Board has very close working communications and meetings with senior staff. Also, to give an example, Iain Gray, the Chief Executive of the Technology Strategy Board, came to Wales and met many companies around Wales, looked at need and the ways forward we could take, and there have been meetings between our officials and indeed officials from the Department for the Economy and Transport. That is an area as well where much closer working between my Department and the Department for the Economy and Transport has been critical in terms of addressing these issues. In fact, I believe there is a meeting today between Iain Gray and officials at DET, so there is very close working at an operational level, also ensuring that we have an R&D priority sector awareness event for Digital Britain on December 15 at SWALEC Stadium, and the TSB lead technologist will be with us for that event.

Chairman: We have almost completed the session, but we have one important question to deal with, namely further education.

Q28 Alun Michael: I think there are fears that further education tends to get lost, as it almost does in this session, coming at the tail end and, secondly, that, despite the intentions which I think you have expressed and the First Minister has expressed that the border should not be a barrier to people reaching the educational provision that they want to reach, nevertheless, administratively obstacles do emerge, problems are put in the way and funding can be a problem, so does the Welsh Assembly Government's further education funding guidance now facilitate cross-border provision when learners want it and, further to that, will you promise to keep the border open?

Ms Hutt: Absolutely, and can I say, first of all, that further education is at the forefront of our policy agenda with the transformation framework, and what is very important about the statement I made last week, it was not just about higher education, it was about higher education and further education and it was about the whole education system in Wales and how we can raise skills levels, but certainly I can give you my assurances that our officials are working closely together to see that there is linkage and no border boundaries in terms of access to further education.

Q29 Alun Michael: Are you and your officials going out to make sure that, where there are anomalies, they are addressed quickly because there do seem to be some anomalies that emerge in this particular area?

Ms Hutt: Certainly, and in fact I would always want to look at any individual examples and of course I get correspondence from constituents and constituency MPs and AMs. A very good example, I think, of collaboration across border which is delivering on FE is the Deeside Alliance and that is a clear development where we are part of the Deeside Alliance and that is a vibrant, cross-border initiative.

Q30 Alun Michael: I think I am right in saying that there is no Welsh representation on the sub-regional groups of local authorities which have been established in England to plan the local provision of education and training. Why is that, and is that a matter that you have taken up with the regional ministers or other institutions in those areas?

Ms Hutt: We have not taken it up with regional ministers, but we have taken it up with the Welsh Local Government Association so that they can look for ways in which we could broker that in terms of active liaison, if not representation.

Q31 Alun Michael: So you are initially approaching it via local government?

Ms Hutt: Yes.

Q32 Alun Michael: But will you come into it if that does not provide a solution?

Ms Hutt: Definitely, yes.

Q33 Nia Griffith: I am sorry, Chair, but I did not come in fast enough to follow up on the Technology Strategy Board issue again. It is this issue about whether Wales is getting its fair share and the implication is that perhaps it has not up until now, so what is actually happening? Is the Welsh Assembly Government trying to make sure that it does pick up on more than the 3.5% which it is getting at the minute?

Ms Hutt: The Technology Strategy Board linkages that I have mentioned now, I hope, will lead to a better share. That is only one source of funding of course, but the fact that we have put the digital economy as our key research priority, I think, is critical. We are very fortunate also that we have David Grant, the Vice-Chancellor of Cardiff University, on the Technology Strategy Board, so I think we have just had to go back to where we have got to deliver the quality and the excellence and not just the share.

Q34 Chairman: Minister, thank you very much for your attendance today. I found the session most illuminating and I hope that you found our questions most constructive.

Ms Hutt: Very.