Written Evidence by About Universities UK (FES0068)

Education Committee

Further Education and Skills

About Universities UK

Universities UK (UUK) is the collective voice of 141 universities across the UK. Our mission is to help UK universities be the best in the world, through their research and teaching, knowledge exchange and commercialisation activities, and through the positive impact they have locally, nationally and globally. 

Executive Summary

UUK welcomes the opportunity to input into this inquiry and highlight the relevance of several of the sub-topics, such as apprenticeships and widening access, to the higher education sector.

Universities, alongside the further education sector, are key deliverers of skills in the following ways:

1. Universities play a fundamental role in developing the higher-level skills that the economy and society require. All eight growth-driving sectors in the industrial strategy report a higher proportion of graduates than the UK workforce as a whole (50%), and for five of the eight sectors, more than 60% of the workforce are graduates, suggesting higher-level skills are needed for those sectors to further enhance their productivity.
2. Skills England should take a place-based approach which capitalises on existing networks, and facilitates meaningful engagement between HE and FE providers, public sector and private sector employers, including SMEs. Given there are gaps in national coverage of Mayoral Combined Authorities (MCAs), national and local government should ensure there are equivalent structures to enable universities and other bodies to feed into local growth plans
3. Degree apprenticeships are a successful form of provision which deliver on skills needs and widens choice of provision to meet different leaner needs, however there are issues with funding and regulatory requirements.
4. Information, advice and guidance at all ages and stages will be vital in equipping learners with sufficient knowledge to make informed decisions about skills provision available to them, particularly following reforms shaped by the new body Skills England

Curriculum and qualifications in FE

The reform of level 3 qualifications

• BTECs, HTQs, T levels and A levels all have a role to play equipping learners with the skills and knowledge they need to progress to higher-level skills routes including a university degree. Any reforms should be made in consultation with higher education providers.
• Qualifications at level 3 must always meet the needs of learners and employers. It is also vital that the suite of qualifications on offer can support progression to higher education, Reform of 16-19 qualifications could have significant implications for how higher education is delivered and so any changes must be developed in close consultation with the university sector to ensure that the suite of qualifications on offer deliver the knowledge, skills, and opportunity that young people need to succeed. The curriculum and assessment review must effectively engage with admissions teams and PSRBs particularly when thinking about the defunding of BTEC provision and the implications of T Levels replacing existing provision.
• A levels, for example, are proven to be widely understood by employers and HE providers (82.8% of A level students progressed to higher education in 2022/23) and recognised for their rigour. The well-established international reputation of A levels is built on depth of learning that supports transition to further study or work.
• T levels also offer a strong progression route into higher education. In the 2024 admissions cycle, as in previous years, nearly all T level applicants (97%) received at least one offer to higher education courses. However, as comparatively new qualifications, improvements should continue to be made to T levels based on feedback from universities and employers (including maintaining the academic content of T levels to facilitate HE progression).
• BTECs also continue to offer a valuable mix of practical skills and academic learning to provide an effective route to higher education or skilled employment, particularly in healthcare disciplines.
• Early defunding of BTECs risks unintended consequences for disadvantaged students who are more likely to study BTECs and use them to access higher education (with around half of BTEC students progressing to higher education). Changes to BTEC provision must avoid leaving provision cold spots while T level employer standards are still in development.
• Effective information, advice and guidance (IAG) for learners continues to be of vital importance as people consider their level 3 options, and the routes open to them. This is particularly true during periods of qualification reform, when the pathways available to learners change.

Skills and apprenticeships

How to resolve the skills shortage and narrow the gap between the skills that employers want and the skills that employees have?

• Universities play a fundamental role in the skills ecosystem, delivering the higher-level skills that the economy and society require. Data from the Unit for Future Skills indicates a clear trajectory towards a strong need for high-level skills, with 11 million new graduates to be required by 2035. However, for the government to truly capitalise on universities’ unique offer to drive skills, it must also fund universities at sustainable levels so that they can continue making a strong social and economic contribution.
• Where there are skills gaps, government should capitalise on the unique role universities play in local skills development. Universities are strongly positioned to (1) deliver high-level skills at scale, and be trusted partners delivering high-quality qualifications, (2) act as a bridge between skills, innovation and research - universities not only supply skills but drive business and job creation, and (3) act as local convenors, bringing together stakeholders in increasingly diverse regional landscapes.
• All eight of the growth-driving sectors set out in the Industrial Strategy green paper reported a higher proportion of graduates than the UK workforce as a whole (50%), and for five of the eight sectors more than 60% of the workforce were graduates including the digital and technology sector (70%), the creative sector (76%), professional and business services (74%) and life sciences sector (73%). There is a strong opportunity for Skills England to play a key role in creating sector workforce plans and having a single repository of information across government, business and the education sector will help create a shared understanding of skills needs.
• Resolving skills shortages requires an accurate understanding of current and future skill gaps. While vacancy data indicates historic and current needs, future projections must factor in issues such as technological transformation, changes in occupational demand and the evolution of skills needs within occupational groups. Future skills needs will be a mixture of cross-cutting core skills and industry specific ones, with a clear shift towards higher cognitive and management skills, as well as digital and AI.
• Upskilling for experienced workers requires adequate capacity to mitigate time spent outside of work which can be a challenge, particularly in the public sector (e.g. NHS). Regions with more fragmented employer landscapes and a higher share of SMEs (such as South Yorkshire) face distinct challenges in terms of adequate engagement between skills providers and employers as engagement costs cannot be met through economies of scale.
• Government investment in careers and IAG support would equip learners to make informed decisions about their educational routes. Improved coordination of this support at a local level, and docking points for employers to feed in their views could make a tangible difference here. Specifically, the Office for Students (OfS) Uniconnect collaboration could take a more strategic approach that links IAG with future skills needs, regardless of whether provision is delivered in further education or higher education. This could also act as an effective interface with Mayoral Combined Authorities (MACs), and LSIPs.
• Degree apprenticeships play a key role in bridging the country’s skills gaps. Apprenticeship starts at Levels 6 and 7 have grown by 122% from 2018/19 to 2023/24 (22,480 to 50,110), reflecting strong student demand and employer appetite for these qualifications. Any decision to limit the funding available for Level 7 apprenticeships would have potentially unintended consequences, masters-level apprenticeships are essential to addressing both regional and national high-level skills gaps within the public and private sectors.
• Higher Technical Qualifications (HTQs) can offer a high-quality alternative to apprenticeships and are an effective provision pathway for learners at Level 4 and 5 in relevant occupations. They can also play a role in widening participation - applications for Level 4 and 5 qualifications are highest in regions where progression to higher education overall lowest, and among mature students who are twice as likely to apply for a Level 4 or 5 qualification than 18-year-olds.

The role of Skills England in meeting the Government's industrial strategy and boosting economic growth

• Powering the Government’s Industrial Strategy and boosting economic growth requires capitalising on the central role universities have in tackling skills shortages at the higher levels. In the English context, Skills England presents a vital opportunity here. With key functions in coordination and intelligence gathering, Skills England must address the historic fragmentation of the skills landscape and establish a long-term strategy for meeting skills needs, across every level and region of the country. To achieve this, the new skills body must carve out a central and visible role for universities as essential higher level skills providers.

• Whilst skills development across growth-driving sectors is vital, Skills England must adopt an inclusive approach to skills development that recognises the need for skills at every level (and at all ages, through lifelong learning) and supports a diversity of study pathways. The valuable and versatile set of skills developed through arts and humanities subjects and need for investment in healthcare and teaching workforces must not be overlooked, nor the importance of protecting the pipeline of R&D talent within universities; all of which are enablers to skills provision and driving growth.

• To add value to local growth in England, Skills England should take a place-based approach that utilises regional skills networks to respond to local skills needs, and forges strong links between business, the Industrial Strategy Council, and the Migration Advisory Committee. Similar engagement, collaboration and connections will be needed across the devolved nations. National and local government will need to address the gaps in geographic coverage of MCAs and put in place equivalent structures where these do not exist if it is to ensure inclusive growth.

• To ensure learners can navigate changes to the skills landscape shaped by Skills England, investment in effective careers support for all ages will be vital. Collaboration between Skills England and the higher education sector will enable universities to be responsive to emerging skills needs through their skills programmes, such as career information and guidance and embedding employability across university curriculums.

Current challenges for apprenticeships, including employer engagement, funding issues, and apprentice pay

• Degree apprenticeships are a powerful tool for equipping people with graduate-level skills while enabling them to do paid work, but there are challenges in the financial sustainability of provision. The current funding bands, which have been frozen since 2017, no longer meet the cost of provision due to inflation and the pressure is higher for high-cost standards such as adult social care. Any reform to the levy system will need to consider the financial sustainability of degree apprenticeships, as they are key to the country’s high-level skills pipeline including in critical areas such as healthcare.
• The potential withdrawal of funding for level 7 apprenticeships is creating uncertainty for educational providers operating in this space. There is also a risk that this sets a precedent for defunding other degree-level standards which have a strong economic return and support many young people onto skilled roles.
• Skills England offers a strong opportunity to rethink strategically the architecture of national and local skills planning and to reduce complexity within the system. Businesses currently find interfacing with the skills system confusing and overly complex, while providers of skills have to navigate multiple regulators and a proliferation of short-term funding initiatives. Skills England can enhance coordination and reduce the complexity of interactions at both a local and national level; it can also simplify regulations and work with the OfS to bolster innovation and responsiveness in the system.
• SMEs have a key role in providing skilling opportunities for young people from disadvantaged backgrounds. Economies such as that of South Yorkshire are dominated by SMEs, which are more likely to take on apprentices from a wider backgrounds. However, SMEs face more barriers in dealing with the regulatory burden and in being able to cope with wage costs, while engaging with a fragmented array of SME employers is also more costly for providers.

The role of devolution in addressing regional skills needs and apprenticeships

• The establishment of Mayoral Combined Authorities (MCAs) has, in some parts of the country, created an effective mechanism for many universities to engage with other education providers, business and the public sector to meet local needs, including on skills. However, national and local government will need to address the gaps in geographic coverage of MCAs and put in place equivalent structures where these do not exist. Strong links between the Industrial Strategy Council and Skills England and effective partnerships with local structures will be essential to achieving stability. Universities outside of MCAs should not be disadvantaged by their geography given their strong offering to opportunity and growth.
• Skills England will also need to support the development of sectors identified in the Industrial Strategy that may have economic geographies that either cross or connect different Mayoral Combined, Strategic and Local Authorities. Universities can play a key role in supporting pan-regional collaboration and responding  individually, locally and collectively to the skills needs of key sectors.

Supporting young people, widening access and narrowing the attainment gap

Access to higher education, other qualification levels, and employment; career and course guidance

• Universities have worked hard to widen participation to higher education over the last 20 years, with the result that more disadvantaged students progress to higher education. However, there remains a stubborn gap in participation rates between the most and least advantaged, and significant regional disparities in higher education participation. Further, there remain barriers to progression of FE students into HE.
• To address these issues, building on the success of UniConnect we are calling for the establishment of a Tertiary Education Opportunity Fund (TEOF). The TEOF should act as a model for local collaborative outreach, with universities supported with long-term funding to establish regional partnerships across HE and FE to deliver outreach activity and provision across the tertiary landscape related to local skills needs. This would improve efficiency of outreach activity, encourage collaborative provision, and increase post-18 progression to a diversity of suitable tertiary routes.

Disparity in attainment, including by gender, area of the country in which a student lives, ethnicity, and between disadvantaged students and their peers.

• Gaps in prior attainment by protected characteristics, socioeconomic background, school type and region represent a significant barrier to equitable progression to higher education. Universities can play their part to both mitigate for those gaps through greater use of contextual admissions, and help to address the gaps through collaboration with schools to raise attainment. They can also enhance collaboration with the FE sector to facilitate progression for students between FE and HE.

March 2025