Children, Young People, and Education Committee

So, I'll move swiftly on this morning to our first item on the agenda, which is the scrutiny of the Welsh Government's draft budget 2023-24. It's our first evidence session, and we are very pleased that the Minister for Education and Welsh Language is here this morning with us, Jeremy Miles. And you have with you your officials, who are Owain Lloyd, director of education, social justice and Welsh language, and Jo Salway, director of social partnership and fair work. You're all very welcome, and I shall say this: happy new year to you as well.

Thank you very much.

Welcome. Before we go into questions, I'd just like to put on record our thanks for the really comprehensive paper that we received from you, and the time that went in from officials to put that together as well. We're really grateful for that piece of work; we know the work that has gone into that. We did ask a lot of questions, so we are really grateful for the paper that we have received, and this has helped us greatly in our preparation for today's session.

So, I'll move swiftly to questions, and I'll start, Minister. Perhaps you can briefly set out the main principles that have guided the allocation of your budget across education and Welsh language, and perhaps you could touch on how you've taken into account COVID, the pandemic, and if that's continued to influence any of your thinking, or if you've taken into consideration pressures such as the cost-of-living pressures that we're seeing at the moment.

Thank you, Chair, and good morning, and a happy new year to you all. Thank you for your initial comments on the research paper—that is appreciated, so thank you for that.

I should say—and I think all Ministers will probably be saying this when they are being scrutinised on their budgets—it was probably one of the toughest budgets during devolution, really, to write. The economic backdrop is punishing, both in terms of the inflationary pressures, but cost-of-living pressures more broadly, obviously the effect of the war in Ukraine and the obligations we've taken on as a Government in relation to that, but also, as you were alluding to in your question, the ongoing effects of the pandemic. We obviously know that COVID is still with us, and the effects of COVID in school, clearly, are with us, and in colleges and universities as well. The funding settlement that we received from the UK Government was not sufficient to meet the current pressures in the budget, let alone future plans. So, against that backdrop, I think that where we and other Ministers have been able to maintain the level of funding, that itself has been challenging and has been an accomplishment in its own terms, just to maintain the level of funding.

But the principles that we've brought to bear, in writing the budget, have been probably twofold, really: one is to make sure that as much money as possible is reaching the front line. We know that there are all sorts of pressures, for example, in schools at the moment, and teachers are providing a whole range of other support to pupils and students, which they ordinarily perhaps wouldn't. So, making sure that we can continue to support the workforce on the front line has been a really important priority. And the twin priority with that, I guess, has been to make sure that, where there are particularly vulnerable groups, that they get the additional support that they need. And vulnerability comes in many forms: one is in relation to the impact of COVID, but, as you also say, the impact on the cost of living as well.

So, on the question of COVID, there is no longer a funding stream coming from Westminster in relation to that. There is no longer a central COVID reserve in the Welsh Government, so I and other Ministers have been looking for provision within our own budgets to make sure that we can address the ongoing pressures—in my case, in the education system. I was very pleased to be able to make sure that we can continue the level of funding for the recruit, recover, raise standards programme, which has been very welcomed by schools, because it's flexible and gives schools the scope that they need, at a local level, to address the needs of their particular cohorts of pupils. We had thought that this year we would need to start tapering that down quite significantly and, obviously, also next year, but we've been able to maintain the level of that budget rather than reduce it this year, which is a difference of about £5.5 million, so I think that's a very important part of the response to COVID. That helps us to recruit and maintain roughly 1,800 posts in schools, so that's a significant contribution to the workforce, operating in a very flexible, tailored way in schools.

Thank you, Minister. Can you briefly summarise how sustainability and the interests of future generations have been reflected in the budget?

Well, I suppose, in a way, it is defined by the needs of future generations, really, isn't it, given it's an education budget. It's all about making sure that we give future generations the best start in life. In a sense, that's the organising principle of the entire budget. One of the key principles in the legislation, of course, is to act in a way that is preventative—and I would argue again that is a theme that applies throughout the entire budget. I've talked a little bit just now about PDG—that's partly a preventative measure, isn't it, to make sure that we can seek to address some of the disadvantage that some pupils face. Also, the additional funding in relation to the additional learning needs reform programme that we've been able to find for this year also has a preventative theme underpinning it. The new curriculum is designed to enable us to meet the four purposes and obviously contribute to the principles of the legislation. I think that's—. We'll probably come on and talk about that, I imagine.

On the capital side, I think there are some very strong examples in the budget in relation to that. You already know that, as of the beginning of last year, all new capital investment, through sustainable communities for learning, as it's now called, needs to be deployed in net-zero schools and colleges, so that's a significant contribution to the sustainable development principle. And Members may recall that I launched an initiative last year, the sustainable schools challenge, which is designed to bring the curriculum and the capital programme together in some way. So, it's a package of funding that will fund two schools—one in north Wales, one in south Wales—where the schools have been built from sustainable materials, natural fabrics, where that's possible, and where the staff and pupils of the school have been involved in the design of it. That was based on actually visiting a school in south Wales where I saw at first-hand young people help design part of a building and I thought, 'Well, actually, there's some scope here to do this more broadly.' So, I'll be announcing the winners, as it were, of that challenge in the next few weeks—I hope before the end of this month. We had 17 bids for that, so it was a very popular scheme. That's an example of how we're trying to bring all parts of the portfolio together and have an underlying principle of meeting the obligations in the Act.

Brilliant. And you mentioned in your opening statement just about how difficult financial times are at the moment and how difficult it's been setting the budget. Are there any programme for government or co-operation agreement commitments that you've not been able to take forward fully or as quickly as you would like due to those budget constraints?

Well, that's been where we’ve focused our efforts, really, to make sure that we don't need to do that. I think the programme for government and the co-operation agreement, obviously, are at the heart of what we're promising to deliver, so we've been able to prioritise that. So, we've been able to maintain or, indeed, as I've just outlined, extend some of the funding in relation to the programme for government commitments. In the co-operation agreement, the funding for universal primary free school meals, for example, and the funding to the Coleg Cymraeg Cenedlaethol, y ganolfan dysgu—those have been important. It's been important for us to preserve the commitments and the funding that goes with that.

Thank you. We'll move on to some questions now from James Evans.

Thank you. Good morning, Minister. I want to talk about cost-of-living pressures on learners and families, and you just touched there on free school meals. I'd like to know from which budget line the £11 million to finance the extension of free school meals during the holidays until February 2023 is being sourced in the 2022-23 budget. Is that coming out of the universal provisions of free school meals budgets, as the provisional local government settlement suggested? And can you confirm that there are no negative impacts on that priority?

Yes. Our principle in relation to that policy has, obviously, been to maximise the roll-out, really, as quickly as possible, given the cost-of-living pressures that families are under. There's been an increasing eligibility for free school meals, but we also all know that there is a large cohort of families who don't qualify, but are finding it very, very hard. So, that's been a top priority for us to do that as quickly as possible.

The direct answer to your question is that the £11 million, which is being used to finance the extension until the end of February, is from an underspend in the projected funding set aside for delivery of the programme. It isn't surprising that there are some underspends in that because it's a novel programme being delivered at speed, so you make assumptions in the budget about who's ready when to draw the budget. So, we've been able to find that money from that underspend, so it's not affecting the speed of the roll-out. That is driven solely by the capacity of the system to deliver rather than the availability of funding. But, having found it, we've been able to deploy that then to extend through holidays.

Okay, fine. As you said, it's coming to an end in February 2023, is that still going ahead as planned, or are you perhaps going to extend it?

Well, as with every other time—. Every other time we've been able to extend it, we've been able to do that very near the point at which it's gone live, if you like, and the reason for that, I think, is twofold. One is that we want to identify the existence of a need—well, clearly, we know that that exists now. Secondly, we need to identify a source of funding for it. We've been able to fund it by looking at other programmes that are demand led, but the demand isn't what we projected, and freeing up funding from that. That's just a part of prudent budget management, really. And so, that's where we are today. We haven't yet got funding identified for extension, but we are having those discussions this time, like we have every other time. We've been able to find £100 million so far to do that, so those discussions are ongoing at the moment.

Okay, because you've also got a pilot, haven't you, in year 7—free school breakfasts in secondary education, and that was introduced in 2020. That's coming to an end at the end of this academic year. Have you considered extending that at all, and what assessment has been made of success on that?

Yes. The pilot for that was extended to the end of this academic year. It was slowed down because of COVID, effectively, so we ran it longer. So, the pilot does come to an end at the end of this academic year. There are 45 schools running the pilot for us. I don't know yet what the plan will be after that because we haven't had the evaluation. The Welsh Local Government Association are working on that now. I'm expecting to get that, I think, in February, so it will be an interim evaluation that will help us get a sense of where we are. And, then, obviously, there'll be a full evaluation after the pilot's completed, and, when I have that, we'll be able to make some judgments.

Okay. Thank you very much. Moving on to post-16 education, you say that the Higher Education Funding Council for Wales are working to monitor the impacts of cost-of-living challenges, and that universities are actually using their own funding a lot of the time to fund students, and using their own resources. What consideration, then, have you given to non-domiciled Welsh students living here, considering that they don't get any support from the Welsh Government with regard to the education maintenance allowance?

Was that the—

The Welsh student support package.

Yes, okay. Well, they obviously don't get the Welsh student support package, and, generally speaking, that [correction: other support packages], obviously—certainly within the UK and internationally—is [correction: are] not as supportive as the funding that we've been able to provide students. So, the support for those students in universities comes in a range of different ways. The hardship funding that universities provide is available not only, obviously, to Welsh domiciled students, but also to students elsewhere. I expect that we will see, when the data's available for the take-up of hardship funds at the end of the academic year, that there's been a significant number of claims on those funds by non-Welsh domiciled students.

There is a little bit of a tension in the system that universities do recognise, which is a little bit of a perception amongst international students specifically that there may be risks to their visa criteria if they apply for hardship funding.

Yes.

So, universities are very alive to that and have a very good understanding of who's applying for funding and how to make sure that those perceptions are addressed. But there are also other sources of support that are available to non-Welsh domiciled students. So, the mental health funding that has gone into the system is available to all students from all backgrounds, and the other support that universities themselves are providing—extended opening hours, discounted food, recycled laptop equipment; there's a range of different initiatives across the system—obviously, those are available to students whether they're Welsh domiciled or not.

Okay. Thank you. I just want to move on to the EMA, because the current level is being retained at £17.4 million. Given the changes to the economic situation in the country with regard to inflation and the cost of everything going up, how did you calculate and assess the potential demand from learners, and what changes were you considering to the level of support? And is this something that you're monitoring quite closely just in case things have to change as we go along?

Well, this is one of the sources of support that we provide for students in further education. And I started, Chair, by talking about how challenging it has been just to maintain levels of funding across the budget. And this, I think, is one of those examples. We've got a programme for government commitment to maintain the funding, and we've been able to carry on doing that, which I'm pleased that we've been able to do.

On your question about demand and how we've approached that issue, we make two assumptions. One is that there'll be, obviously, a continuation of the existing cohort of students who are claiming, but, then, also, we make assumptions about the likely future demand from a cohort of new students. The reality is that we have not been able to find the budget to be able to increase the pot of money available for EMA. So, what we have done is to ensure that all of those who are eligible—or as many of them as possible, realistically—know that they're eligible and find it as easy as possible to claim. And we've also extended some of the routes to eligibility. So, for example, all care leavers are automatically entitled, provided they meet the other non-financial criteria in the scheme. We've made it easier for those students whose circumstances may change during an academic year—which is a potentially significant number—to claim mid-year and then have a backdated entitlement to, I think, 13 weeks of EMA.

So, we've looked at extending the eligibility wherever possible. Student loans companies are also working with us on a platform—an online platform—to make it easier to apply. So, we're looking for ways of extending entitlement to the existing level of support, but we've not been able to find ways of increasing that. I did say at the start that it was one of the ways that we support students in further education.

We also have the financial contingency fund, which is funding provided to colleges themselves so that they can operate, effectively, a hardship scheme. And you may recall that I announced additional funding for that a few weeks ago—. Well, I haven't made the announcement formally yet, but I indicated in the Chamber that I was about to make it, and I still am about to make it. That will be a little shy of £1.4 million, which will go into that pot of funding. So, that's the overall picture in FE.

Okay. Thank you. I had one more question, but you answered it, I think.

Okay. Thank you, James. Minister, I wonder if you'd share with us the interim findings from the year 7 free breakfasts pilot when you have that information.

I'm sure we can do that, Chair.

That would be great, thank you. I'll move on to questions now from Laura Jones. Laura.

Thank you. Thank you, Chair. Happy new year, Minister, and thank you for your paper. If I could just start by asking you whether you can confirm that the £9 million increase to the pupil development grant is to meet the higher demand from a greater number of pupils eligible for free school meals, rather than an increase in the level of support per eligible pupil, and that the budget actually decreases by £5 million from this year. And in light of that, can you point to any additional funding in your budget targeted at narrowing the attainment gap between disadvantaged learners and their peers, which has remained stubbornly wide, both before and during the pandemic? Thank you.

Certainly. So, the budget hasn't gone down by £5 million; one item in the budget has gone down by £5 million, but the net increase in the budget is the £9 million figure. So, the budget, taken as a whole, is £9 million higher this year than it was last year. The £5 million figure, incidentally, is referable to that one-off intervention that we made last year to temporarily increase the PDG access element of the funding. That was always a one-year intervention. So, you'll have seen a higher figure last year than there was previously and than there was this year in relation to that particular pot of money, but the PDG pot has gone up by £9 million. Just to be clear, that is £9 million more money going to schools. That's the net effect of that increase.

On your point about how it's calculated or what it's intended to address, what it means is that we have not had to reduce the per-pupil level of PDG support going to schools. So, it is driven by an increased number of pupils who have become eligible, but had we not found this budget, the way of meeting that demand, which we have to meet, would have only been—. The only way of doing that would have been by reducing the per-pupil level of the funding, which we have been able to avoid doing by finding the extra £9 million. I should just say, on the PDG access funding, we are rebranding that to call it 'school essentials', because we are very mindful of the fact that since pupils generally, or certainly in primary, no longer have to apply for free school meals, that is a gateway support for other support that is available in schools. We are trying to make sure that families are applying for the support that is available, regardless of them getting the free school meal, and one of the ways we've been doing that is to try and—. 'PDG access' actually doesn't mean very much to most people, does it? It's a pretty technocratic term. So, by calling it 'school essentials', we're trying to focus people on the uniform, the PE kit, the school trips, and there's a comms campaign that we are running in order to do that as well.

On the second part of your question, 'What is in the budget to support disadvantaged learners and to close the attainment gap?', well, just to say the aggregate budget figures for PDG and PDG access, both of which do that, for the forthcoming financial year, is around about £155 million [correction: 142.5 million]. On top of that, we have the £37.5 million, which is the Recruit, Recover and Raise Standards programme money, which, whilst it is allocated on a pupil number basis, is also weighted, including to give more funding to schools with higher numbers of disadvantaged pupils, so that is a progressive funding stream as well. And on top of that, you'll recall last year, in the statement I made in the Chamber and the speech I gave to the Bevan Foundation, a significant list of policies that we either have brought in or are working on bringing in, designed to do exactly that which you said in your question, and that is all funded throughout this year as well in the budget. So, for example, funding for the community-focused schools programme. We know that that is a key way in which we can help close the attainment gap. Funding for family engagement officers, funding for education welfare officers, the education endowment fund toolkit work—all of those interventions have funding in this budget as well.

Okay, thank you, Minister. I very much welcome the 'school essentials'—a simple but very effective change I think that will make, and hopefully it will increase take-up. So, well done on doing that.

How efficient are your budget allocations likely to be in light of the inflationary pressures on schools at present, and how much of the funding that you say that you've put into the local government revenue support grant for schools, the RSG, will be left once the teachers' pay awards have been met? Thank you.

Well, the money that has just gone into the budget is separate from the funding in the budget already for teachers' pay, so they're separate things. The teachers' pay funding was part of the negotiation for the last round of RSG, and this is money that has come in, obviously, more recently than that. So, in a sense, they're very separate. You will recall that local authorities, obviously, are responsible for funding schools directly in Wales, and I think the funding that has been made available has been welcomed on a cross-party basis, really; authorities of all political colours have welcomed that, so I take that as a positive sign. Obviously, local authorities face very significant pressures, as do we and as do other public services.

Thank you, Minister. How concerned are you about the real-terms value of your capital budget, given there is no increase to your planned spending in 2023-24 and school construction costs are facing reported inflation of about 15 per cent?

Well, just to say, I don't wish to be particularly party political about it, but this is one of the most extraordinary aspects of the settlement from the UK Government: there is not a single penny allocated for capital in that budget. Where we are, you're right to say that inflation is having a significant impact on the capital programme. There's a real knock-on effect in manufacturing costs, on the cost of equipment and obviously also the cost of the workforce, and they will inevitably and inescapably lead to less being delivered for the same amount of money. That is the consequence of there being no further capital allocation into the Welsh Government's budget. What I would say, though, is from an education point of view, the capital allocation for last year—well, the current financial year, the one we're in at the moment—is being maintained, and this current financial year's commitment was a 33 per cent increase on the previous year. So, we saw a sharp increase in this financial year, and that is being maintained. So, that's the overall picture in terms of the trend. However, the practical implication of inflation on the budget is that we are seeing local authorities, further education colleges revisit their plans in relation to construction and new development. There is a pretty much universal pressure, I would say, across the system and a number of projects slowing down as a result of that.

What are we doing as a Government? A few things. So, we are working on a pretty bespoke basis, on a project-by-project basis, really, with authorities and colleges on what that means for them. Where there are additional costs, we're doing what we can to share some of those costs. We have what we call an intervention rate, the level of funding we provide to a new build, and that's generally—not always—65 per cent. So, we would generally bear that. Where we can agree to carry further costs, it's 65 per cent of the cost that we end up carrying, generally. So, that's one aspect.

The other is: I was keen when I became Minister to try to take some of the layers of bureaucracy, if you like, out of the programme to make it nimbler and make it easier, both for authorities and, frankly, also for us to manage the overall programme. So, we've moved away, as you might remember, from the bands that we've had until now. We now have a rolling programme at the end of band B. And what that means in practice is twofold. I would say it's more strategic, because it's a longer term horizon; it's no longer a five-year period, it's a nine-year period. So, you've got greater visibility of plans. But, within that, there's a short-, medium- and long-term set of horizons: three-year short term; six-year medium term; nine-year long term. And that enables everyone to be much more nimble, basically, about how they approach the capital investment programme, and to be—I don't want to use the word 'opportunistic', because it isn't that, but to be able to respond to changes, both positive and negative, if you like, in the market. So, I hope that that will at least bring some flexibility to the programme, which means that the funding can be even more usefully deployed, really. So, I think those two things are the main ways that we as a Government have been able to help.

I'll just bring James Evans in, just for a quick question on that.

Just on this point, Minister—and I actually share some of your concerns around capital as well—how concerned are you with the pressure on capital budgets, about pupils being in probably sub-standard settings, really? And have you made any assessment of what that could do to educational attainment?

Well, the entire programme was designed to address that, so we're in constant dialogue with authorities around their own schools, but also with dioceses where there are faith schools, with voluntary-aided schools and also with further education colleges. So, that's the entire purpose of the programme, really. That's why it's so important to be able to get as much value out of the capital programme as possible. I actually think that the change to the banding that I've just described to you will help us to be able to respond to some of those challenges as well.

I would say, alongside the sustainable communities for learning funding, which is what I've been talking about—that is focused on very, very major refurbishment or new build—there's also a capital programme that we fund directly to authorities that enables them to work on maintenance, health and safety, decarbonisation, and ventilation. I'm actually about to say some more about that in the coming weeks as well. So, there's more than one source of funding. But the point you're making, I think, is that all of those are going to be affected by the pressure through inflation, and I agree with that.

Yes, and it's just what assessment have you made on learner outcomes, really? Do you think it'll be detrimental to them because schools can't make the adaptations they want? Have Welsh Government done any of that work around this?

Yes, absolutely. As I was saying, that's the purpose of the programme. We know that there is a link between a school's ability to teach in the appropriate way with the facilities the school has. So, that's why we want to make sure that pupils in all parts of Wales are taught in modern, appropriate surroundings. That's why it's such an issue if the funding isn't delivering or being able to buy, if you like, as much value as it would otherwise.

Okay, thank you. Back to Laura.

Thank you, Chair. Thank you, Minister, for that. Since the moving of the dedicated raising school standards funding into the mainstream budget line for 2022-23, can you explain how you are ensuring that there is no dilution in focus in the school improvement agenda and that the funding channelled through the regional consortia continues to deliver best value for money? Thank you.

Yes. Just to say, on the school improvement funding that we provide, that is only one source of school improvement funding as well. Local government themselves provide school improvement funding. I might ask Owain to say a little bit more about that in a moment. But on the question of—. Just to say, there really is no link between where in my budget this funding sits and the focus of the system on delivering the outcomes. One is a budget management exercise, the other is delivered by a very clear set of expectations, some of which is regulatory, some of which is otherwise, and a lot of guidance to the system about how to meet the expectations that we all have of it. So, you'll remember that, last calendar year, we published our new school improvement guidance—I published that in the summer—and that sets out very clearly the approach that we have and our policy priorities for schools.

On the monitoring aspect of it, you were talking about how you can make sure that there isn't a dilution in focus, this is a very significantly monitored area of how the programme funding is spent. So, we discuss and review the expectations for each policy area with the consortia and with local authorities through a regular process of engagement and monitoring. We have those discussions regularly and routinely, and that then enables us to be absolutely sure that the money is being deployed in the way that we need it to be deployed. But do you want to say a bit more about other sources of funding?

Yes, just to pick up on the point that the Minister made specifically around school improvement. So, I do think it's important to remember that the key focus of regional consortia is school improvement, and obviously the key relationship there is between the regional consortia and the local authorities in terms of the service that is provided. So, each local authority around Wales, as part of their regional consortia discussions and agreements, put in an annual set of money. So, in the same way that we are currently looking at the next financial year, how we're going to be funding partners, including regional consortia, local authorities are currently having those discussions in terms of what the funding settlement for their own regional consortia, specifically for school improvement, will look like in 2023-24.

I think the other thing to note around not just school improvement but the money that we pass on to regional consortia—whether that's for foundation phase or whether it's for professional learning—is that the majority of that money, in essence, is passported on directly to schools. So I think that's another important point to note for the committee.

Thank you. Thank you, both, and thank you, Chair.

Thanks, Laura. Questions now from Buffy Williams. Buffy.

Thank you, Chair, and thank you, Minister, for joining us this morning. The budget for supporting the new curriculum remains broadly static. Did you consider prioritising this budget for any increases, given Estyn reported in its summary of findings ahead of its 2021-22 annual report that schools' progress towards implementation is too variable?

Well, it's the same point that I made at the start, in a sense, which is, I think that being able to maintain the level of funding has been challenging in its own terms, really, across the piece. Obviously, this is a priority area for us, so I wanted to make sure that the right level of funding was continuing to be made available. On the link between variability and overall level of budget funding, I would put it slightly differently. What that tells us is how the funding should be deployed, rather than what the overall envelope should be, and the Estyn work was very valuable, in that it actually echoed what we already understood to be the situation. So, obviously, you'd expect there to be some level of variability; the task in hand is to make sure that that's as little as possible. Our assessment is that, where there is variability in curriculum roll-out, that is not limited or isolated to questions of the new curriculum, and it correlates with, generally speaking, other challenges that the school faces—perhaps underlying challenges. And schools in that situation are already getting bespoke support from school improvement services, and, in a different way, from Estyn, and indeed from the Welsh Government education officials as well. So, I think that's the way to link the two points that you are making. The school improvement services are very clear that they understand where this is the case, and they're obviously focusing their funding, and the funding that Owain has just described, on schools that need particular levels of support. But I think £36 million to support the curriculum roll-out remains a very significant figure, and, obviously, it's very important that we continue to fund that, to make sure that schools can introduce the curriculum successfully.

Thank you. Your paper notes that local authorities are concerned about increasing demand on SEN and ALN services, and the volume of learners who still need to be transferred to the new ALN system of individual development plans by 2024. Given that we have already seen numbers of learners recognised as having ALN decrease since the new system was introduced, are you concerned that resource issues rather than need will become a key driver for decisions about which learners get ALN support?

Well, I would be concerned if that was the case, and we must make sure that it isn't the case, because the whole point of the new system is to be driven by the particular profile of needs of the individual learner—that's the entire rationale for the new system. What I would say is that I don't think that the reduction in numbers that we saw is an indication of reduced levels of need in the system; I don't think that is the case. What I think is the case is that the particular list of individuals—these aren't just numbers, they're individual learners, aren't they—having looked at those, authorities have decided that perhaps people have been miscategorised, perhaps people's needs were temporary and have been met, but they remain on the list. I think those have generally been the driver for that change on that list. My own expectation is that we will see the numbers increase again. That's certainly what happened when England introduced, in their case, actually more modest changes, but they still saw this happening. And what then happened was a gradual increase again in the numbers, and I think that will happen with us as well, because, as I say, the overall level of need I don't think has diminished. On the question of how you resource that, in this budget, we're investing £25.6 million, which is £4.5 million more than last year, and you'll remember that last year was a significant increase on the year before that. So, there's a pattern of continuous increase above what I think was already a good level of funding. Again, if you compare this to reforms brought in in other parts of the UK, I think I'm right in saying it's a significantly better funded set of reforms. We need to make sure that continues to be the case, obviously. So, yes, I think that's where we are.

Thank you. How disappointed were you with the 2021 census results in terms of the Welsh language, and how has this affected your decision making regarding the allocation of your available budget? Are you fully confident the necessary resources are in place to support the education system's role in contributing to the 'Cymraeg 2050' agenda?

Well, obviously I was disappointed in the census results, but I was also heartened by the results in the national survey, which shows the opposite trend. So, the task, as I was saying at the end of last year, now is for us to look at why those sources of data are telling us different things. And the Office for National Statistics, which deliver both those pieces of research, those surveys, are going to work with us on that. I think it's really important that we understand that, because that will guide all sorts of policy choices that we want to make. What I said, when I first got the job, I think, was that when we had the results of the census, we would then look again at the projections that we had for pace and for direction of travel, and re-evaluate that, and that's obviously what we are doing. We would've done that, incidentally, whether the census figures showed an increase or a decrease. I mean, it's just new data, isn't it, so you need to take that into account.

A lot of the things that one might do in response to the census figures that we saw last year, I took the decision to do them before the census results were known. So, there are a lot of new things that we've been able to introduce over the course of the last year. Some of those things we could've delayed to see what the census results told us. I chose not to do that, because even if the census results were very positive, there were still things that we needed to do to make the biggest difference possible. So, that's just a bit of context, I suppose.

On the funding question, you're asking me to say, 'Do I have enough funding in my budget to do all the things I want to do?' No Minister is going to be telling you that this year because of the overall context—probably no Minister would ever tell you that anyway. There are always new things that we can find to invest money in. But the budget now stands at just under £21 million for the Welsh in education side of my budget. There's also a Welsh language policy side of the budget. And, in addition to that, there's a range of ways in which funding from other portfolios are designed to support the Welsh language, and that's really important and that mustn't change. The whole point of this is that there's a cross-Government lens. So, I think, with that context, I'm confident the funding we have enables us to meet the plans that we have.

I'll just bring Sioned Williams in at this point.

Thank you, Chair. I just wanted to ask more specifically on the funding you mentioned. I wanted to ask if you're confident that there will be sufficient investment in initial teacher training and sabbatical programmes in order to secure growth in the Welsh-medium education workforce, given the results of the census. But also, of course, on the role of education, whatever the results of the survey were, there is a huge role for education in delivering the target of 'Cymraeg 2050'.

Well, the sabbatical programme is one of the ways in which we can support teachers to develop Welsh-medium skills. So, if you look at the broader range of things that we do, then I do think that the budget we have is sufficient to take us to the next phase. We have to build capacity within the system in order to develop the skills that we need. So, I think the budget we have is sufficient to move to the next phase, if you like. Would it be possible in the future, with far more resources, to make other decisions? Well, of course it would be. But we are on a pathway to achieving that, I would say.

Diolch. James Evans would like to come in as well.

Minister, do you think there are enough resources in the system to actually put new Welsh-medium provision in parts of Wales where there is no Welsh-medium provision at all?

Yes.

That’s what I needed to know. Thank you.

Back to Buffy.

Thank you, Chair. Minister, there is no additional funding for the whole-school approach to well-being than what was planned in 2023-24, although this is an increase of £2 million from 2022-23. Are you confident this is sufficient, given the challenges in this policy area, for example issues surrounding mental health, pupil absence and peer-on-peer sexual harassment?

Well, what the budget does is it delivers on the planned increase. So, there is actually an increase, as you were saying, and that does show our commitment to a whole-school approach. Now, I think one of the key things that we have discovered from COVID, and I think it will be exacerbated by the pressures that families are under in light of the cost-of-living crisis, is how important it is that we adopt this whole-school approach—that it isn’t an isolated set of interventions. I would say 'a whole-system approach', actually, which extends from early years through to universities along the entire education journey.

The funding that we make available for the whole-school approach is partly funded by my budget, partly funded, as you obviously know, from the health budget, and I work very closely, jointly, with the Deputy Minister for Mental Health and Well-being on how that budget is deployed, and there are important judgments to be made about how best to use that in schools. We want to make sure that there is direct support for pupils in counselling provision, but also how we extend that in primary, but also support for teachers to be able to understand their own needs, obviously, but also the needs of their learners. The budget has increased significantly, I would say, over recent years—and sharply, actually. So, it’s gone from £9 million in 2021 to over £14 million in this year, which I think shows the level of need in the system. That’s why it’s happening, obviously. We’re recognising and identifying a greater level of demand, and so that’s why we’re doing it. The funding, I think, as I was just alluding to, is only one part of it, and it’s really important that we look at how best to make sure the system works together. We are not in a place, I would say, across the Government in the current climate where we can afford to have different budgets doing different things in a way that isn’t joined up. So, it’s really important that all parts of the school system understand how best to make this funding work, and that’s part of the work that Lynne and I are doing together, to make sure that all the frameworks that we have, all the policies that we’re bringing in, speak to each other, and that the budgets make as much difference as possible.

Thank you. Thank you, Minister. Thank you, Chair.

Thank you, Buffy. What is your assessment as to why the budget reserves held by schools have been so historically high over the past two years? For example, in March 2021 they were £181 million and in March 2022 they were £301 million, compared to £32 million in March 2020. Are you satisfied that schools are using these balances during the year, and how do you monitor that?

Well, in a sense they’re not using them mid year; that’s why they’ve accumulated. But I think there are reasons for that, to be fair to schools. I would say that the £32 million figure that you gave obviously is true, but I think that’s an unrepresentatively low figure, actually. If you look over the last 20 years, probably, the general picture has been that the reserves level is roughly twice that—still a lot less than it is now, absolutely, but that was a particularly low figure, just as context.

The reason it’s happened, really, is that during COVID we continued to fund schools with the funding that we provided for them, and the need of schools to spend money in the same way was obviously different during COVID because schools were operating differently, and therefore reserves have been built up that are more significant than they otherwise would have been. Just to say, schools have plans for using parts of those reserves. They’re earmarked for all sorts of things that we want them to spend that money on. I would also say—and this is really important—obviously, reserves can only be used once, so they are not a solution to long-term funding pressures in schools. However, they can be part of the solution to the short-term funding pressure in schools. What we understand from talking to the Welsh Local Government Association and to authorities themselves is that we expect that, within about 18 months, we'll be back to something that is more approaching a normal level of reserves in schools. But deploying those reserves in the short term hopefully can contribute to some of the extraordinary pressures that schools are facing at the moment.

Thank you. That's really helpful, Minister. We appreciate the point you made on the £32 million as well. Will they be used for capital spend, the reserves?

What we are allowing schools to do is to speak with their authorities on how best to deploy the funding that they have. I'm not sure I have a very clear picture of the breakdown between capital and revenue.

These are mainly revenue and running costs, so, obviously, capital from an accounting point of view is a very different thing, and the Minister has talked about the Sustainable Communities for Learning pot. There are different pots there available for routine, ongoing maintenance. So, there is a differential there.

Thank you for that clarification—really helpful. Questions now from Sioned Williams. Sioned.

Thank you, Chair, and I should have declared an interest that my husband works in higher education at Swansea University.

You state, Minister, that the core funding for higher education remains in line with the previous year's indicative budgets, but stakeholders within HE have raised concerns about increasing financial pressures arising from the student support for cost-of-living issues. We've already discussed energy costs, of course, and the fact that fees and grants aren't now sufficient to meet the teaching costs for UK students and for research and innovation activity. So, how would you reassure stakeholders that this budget takes account of the financial pressures facing HE providers?

We are in ongoing discussion with HEFCW on the funding situation across the sector, as you'd expect, to ensure that we understand in as much detail as possible the situation on the ground in the short term and, perhaps, the trends for the longer term so that we can plan for that. I've been pleased, within the financial context that I mentioned at the outset, that we've been able to maintain the level of funding for universities and the broader sector. It's been a challenge to even achieve that, but it is important that we're able to do that so that at least the source funding that comes from us—it's not the only source, as your question made clear—and the element that is provided by us is in line with the support that we've been able to provide to the sector recently.

Thank you. Your paper confirms an ongoing allocation for HEFCW of £2 million for student mental health support. However, HEFCW’s own evidence to our inquiry on mental health support in higher education said that this funding was having to stretch to meet increasing need, and other stakeholders have also called for a more long-term allocation of funding for mental health support. So, in that context, to what extent are you satisfied that a one-year allocation of £2 million for that area is sufficient?

I acknowledge the pressures on any element of the budget in the economic context, but also in the context of increasing demand. So, that's clearly the case. I wouldn't recognise this as a one-year allocation. In every year since 2018, we have been able to allocate a similar fund, so it's something that we have been providing for around five years, or certainly four years now. I also understand and recognise and agree with what you've heard in terms of people wanting to see funding available in the longer term. We're in that situation as a Government, as we would like to have budgets that span more than one year. As it happens, we are in a period now where that is the case, where we have been able to give an indication to institutions as to what the likely budget will be for the next two years.

But the fact that funding is allocated annually doesn't necessarily mean that institutions have to make decisions on an annual basis. Every element of the public sector, to a certain extent, receives an annual budget, but they make commitments that extend far into the future, of course. So, it's a choice available to any institution as to how they do that—on an annual basis or for the longer term—and that is true of universities as it is of anyone else.

Thank you. In terms of the student support grants, there has been a reduction of £11 million in the budget expenditure line. So, to what extent is this due to historic underspend versus the need to reprioritise funding?

Diolch. I might just ask you to say a little bit more about this, Jo.

The way we work in this area is that we look at the projected demand in terms of budget. We then put funding aside to ensure that we are able to meet that demand. But, to be entirely clear, whatever the demand, we will meet that demand—so that is quite clear—in terms of students going to university. We're not going to be in a situation where there is no money available for that—I want to be entirely clear on that.

But as you go through the financial year, you do check to see whether your projections are coming to fruition on the ground, and, more often than not, if you've planned carefully, you will have more in the fund than you will spend, and then you can release that for other purposes as you move through the year. And as you approach the end of the year, then the picture is far clearer of course. So, this year, we decided to do our best to do that at the very outset. Because what you see otherwise is that you can release funding at the end of the year, but perhaps you will have had to make cuts at the beginning of the year. Now, as the pressures were so significant this year, I didn't feel that we had the luxury of doing that in exactly the same way. So, we've looked at that earlier on in the year.

But just to be clear, that doesn't mean that we won't meet demand: whatever the demand is, we will meet it, we will answer it.

Jo, do you want to give a bit more colour on that?

Just to reflect the points that you're making, that it's very, very challenging to manage a demand-led budget in this way. And what we've got is a range of very complex modelling to look at what the expenditure is going to be. But as the Minister says, year on year, we are finding that, within the financial year, we're spending less than we've projected. So, basically, as the Minister says, this is a risk-based approach to it, of deciding that it's better to plan for that money at the outset, so that we can meet the kinds of pressures that we've been talking about all the way through this session, rather than waiting until the end, and, potentially, having cut something very core, rather than allocating within the year.

Thank you. If I could move now to policy areas, including degree apprenticeships and research and innovation, which sit under another Minister’s portfolio, but are of course partly funded from within the education and Welsh language main expenditure group, can you give us any details as to how you and the Minister for Economy co-ordinate support for degree apprenticeships, and how the Welsh Government intends to carry forward its programme for government commitment to expand degree apprenticeships?

Well, officials in my department and officials in the department of the Minister for Economy work very closely in these areas, where we have policy elements that are jointly funded, if you like. And when joint funding happens, the Minister for Economy and I agree on what those priorities should be and how we can extend policy in this area and support that. The emphasis has been on higher skills in construction, engineering skills, and in digital sectors. And we also want to ensure that we have opportunities to extend access to groups that perhaps have found it more difficult to access degree apprenticeships in the past. In this budget, we have two funding sources that support this policy area. We have around £5 million in the HEFCW budget, which will be provided for that, and £4.87 million in the budget of the Minister for Economy, which will go towards apprenticeships. Of course, there is an element of joint funding that is inherent in that kind of provision. So, it's around £10 million between the two budgets going to that policy area.

Thank you. Thank you, Chair.

Thank you, Sioned. And questions from Ken Skates.

Diolch, Chair. Thanks, Minister. I'm just going to ask about the £9 million additional allocation to post-16 provision, which aims to fund a review of renew and reform funding, as well as absorbing any further pay pressures for school sixth forms and the FE sector. Given inflationary pressures, do you think that's a sufficient sum to ensure further education settings can meet the financial demands on them?

Well, just to say that this is an area where the autumn statement was silent on support for FE. So, we've been absolutely clear that we want to give priority to the further education sector. You may recall that last year's FE settlement was the largest increase in that budget for many, many years—I can't remember quite how many years, but a very long time indeed—and this year's budget is an increase even beyond that. So, that's the kind of trend, if you like.

The sum of money that we're adding into the budget—the £9 million—is designed, really, to ensure that we can maintain a principle that has been very important to us, which is pay parity between schoolteachers on the one hand and further education lecturers on the other. So, that is what we expect that funding to support; so it's a pay-related commitment. We are working at the moment with the sector very closely to understand the pressures that they face more broadly than that.

One of the key pressures, which I think this committee has also discussed, is the pressure on the resources that colleges themselves use in order to support vocational learning. So, the cost of buying in materials, for example, to be able to deliver some of the vocational qualifications that they provide—the consumables—the costs of those have gone up. So, they're affecting the construction sector, but they're also affecting construction qualifications, because it's the same set of pressures that they face. So, we've provided, most recently, another £2.5 million for the sector to support pressures in that area. And I touched on a little bit earlier some of the commitments we've been able to make for FE colleges to support learners in the financial contingency fund space.

So, there's a range of ways that we try and do as much as we can to support the sector, but the overall trend in funding has been very positive. That's not to diminish for a second the pressures that colleges are facing from a range of different areas, but we are doing what we can to help them meet those pressures.

Thanks, Minister. I'm just going to ask about the young person's guarantee as well. The funding for that—the majority at least—sits in your MEG, but there's also a contribution from the Minister for Economy's MEG as well. How do you and your officials co-ordinate the funding and delivery of the guarantee, and how is its impact across portfolios evaluated?

That happens in a range of ways. So, at a ministerial level, because it's a key manifesto commitment and touches a number of portfolios, the Cabinet, I think at the end of last year, November time, had a discussion around how to take the policy forward. Obviously, the Minister for Economy and I work very closely together because it's very, very—. It's a policy that straddles both budgets, obviously. On an official level, we have a young person's guarantee programme board and there's also an employability and skills board. That meets at official level; that includes officials from Jo's team and, actually, the officials, as I understand it, from Vaughan's team on this area, work to you as well, Jo. So, we have a very conjoined system, really, where the officials work as part of one team, even though the budgets are separate. And I think that's really important. We should not be designing policy based on the allocations of Government portfolios; we should be designing policy on the basis of the need of the economy, and that's a good example of how we are doing that.

Can I just bring Sioned Williams in on this point?

Just one other thing you clearly work closely with the Minister for Economy on is research and innovation—and we touched on that in the questions that I asked earlier—but there have been calls from stakeholders for significant increases in the funding for research and innovation. So, how do you work with the Minister for Economy on this policy area, and how does your budget support research and innovation within universities?

Okay. I'll ask Jo. If you would respond to that, Jo.

So, again, it's the basis of working across Government. Research and innovation isn't just about higher education; the funding sources aren't just ours. So, there's an interplay with the UK Government, there's an interplay with the different parts of the organisation to actually clarify what the research priorities are and the best ways of addressing them. And again, a close working relationship between the Ministers.

Diolch.

Okay, thanks. Ken.

Can I just go back to the young person's guarantee again? Sorry. Just to ask a follow-up question. So, there's a programme board that is led by Jo, I take it, then, for this particular initiative. Do health officials sit on the programme board at all, given the interplay between particularly mental health and education, skills and employment outcomes?

Yes, we work closely with health officials across it, because one of the things that I think we've been grappling with with the young person's guarantee is when that was included as a manifesto commitment and when that became part of the programme for government, there was a very, very different landscape and we were anticipating what we would need to do to support young people, particularly coming out of the pandemic and making sure that we're agile enough to respond to what we're actually finding is coming through. And one of the things that we've found is that, actually, there hasn't been a really massive increase in displacement, but we are making sure that we align the young person's guarantee more closely with the work that we do around young people who aren't in education, employment or training, and very much trying to use some of the additional funding that's in the economy MEG to make sure that we're targeting the support much more around the issues that are manifesting, and joining that up across all of the support that's available is absolutely key.

Would it help at all if there was some form of contribution from the health MEG, do you think, in terms of, again, specifically with regard to emotional resilience and mental health?

One of the things that we've been trying to do is, rather than—. And, again, I think the Minister has touched on this earlier, that point that, with the budgets being as tight as they can, we can't be recreating support. So, working with health to make sure that we are accessing the support that's there, that's very definitely been something across the young person's guarantee, where we've been looking at all of the programmes that we're running and working out how we can actually flex them. So, some of the ways that we redesigned ReAct+, for example, that captures that principle that we're looking to make sure that programmes that we've had that are long standing, that have a strong brand and reputation, can be the thing that provides the support in the specific circumstances we're seeing.

Great, thank you. And, just finally from me Chair, the implementation of the Tertiary Education and Research (Wales) Act 2022 is now under way. There's been a £1 million reduction in the budget allocation for post-compulsory education and training. Are you able to give any indication as to why this change occurred and how you anticipate the budget structure may change as the commission begins to operate its functions?

Yes. It's simply a function of the reprofiling of the spend for establishing the commission. So, you might recall from our previous discussions that my original intention, as the Bill was being taken through the Senedd, was to have the commission operational, if it could be, or at least the planning assumption was, from April 2023. It became clear, as the committee knows, that there was just too much to do, effectively, to make that happen in April this year, so we delayed that until April next year to allow all the important work that needs to happen to set up the commission, bringing in the statutory instruments and so on, to happen during this year. As a consequence, it's a reprofiling in spend, effectively. It doesn't affect the overall funding to be spent by the commission; it just starts to spend it later, basically.

Okay.

Lovely. Thanks, Chair.

Okay, thank you, Ken. Just to take you back to the point on free school meals, Minister, just on the basis of what you'd said earlier, can you confirm that you're actively considering extending holiday free school meal provision beyond February half term if funding could be found?

Yes, we're in the discussion to see if we can find funding at the moment, which is why I'm not really able to commit anything, but we're having those discussions as we speak.

We could but try.

And, just finally as well, perhaps. The committee has called in the past to have a separate child rights impact assessment. Can you explain why you haven't carried out a separate child rights impact assessment of your budget, as the Children's Commissioner for Wales and, as I said, this committee have previously requested?

The approach that we've taken is to take an integrated approach to impact assessment more generally. I think that is important in the context of a budget because you want to see the interplay of all the relevant considerations that you have. The child rights impact is obviously very, very important, but so is an impact on the language and impacts on other factors as well, and doing an integrated assessment allows that to be taken fully into account, I think.

Okay, thank you, Minister. I can see no further questions from Members, so I'd just like to thank you very much for coming in this morning and joining us and for your evidence that you have given us. As I said, thank you again for your very comprehensive paper that helped us to prepare for this session. You will receive a transcript in the coming weeks for checking in due course. And, once again, diolch yn fawr for attending this morning. Thank you.

Diolch yn fawr iawn. Diolch.