APEX Trust

HC Deb 15 January 1992 vol 201 cc963-8 3.31 pm

Mr. Tony Blair (Sedgefield)

(by private notice): To ask the Secretary of State for Employment if he will make a statement on the future of the APEX Trust.

The Secretary of State for Employment (Mr. Michael Howard)

The APEX Trust was established 27 years ago to assist with the employment and rehabilitation of offenders. It is one of a number of organisations working in that field, and it has made a valuable contribution. APEX has been involved with the employment and training programmes of my Department for many years. It has participated in employment training since the launch of that programme in 1988. It has also received core funding from the Home Office.

In April 1990 the first training and enterprise councils were established. In 1990–91, 51 TECs were set up. The remainder were established in the current year, 1991–92. The TECs took over the task from the Department of contracting with providers locally for training. In the spring of 1990, the Department recontracted with employment training providers, with some adjustments in volumes and unit price. In doing so, we of course gave the providers the necessary contractual notice. When all the TECs had been established, my Department ceased to have training contracts with APEX.

All TECs have available working capital loans to meet initial costs and to enable them to advance funds to providers where they have thought that appropriate. The position of APEX was no different in those respects from that of any other training provider.

In March 1991, my Department agreed to make available up to £500,000 to assist APEX in adjusting to the new contractual levels of employment training. So far, APEX has been paid under that arrangement £250,000 at the end of March 1991 and a further £100,000 at the beginning of October. Meanwhile, APEX has concluded contracts with a number of TECs and has generated revenue from those contracts.

My Department made a duplicate payment to APEX in April 1991. It is difficult to know how that payment could have added to APEX's financial difficulties. The effect has been to provide APEX with an interest-free loan. We have told APEX that we shall be willing to phase the recovery of that sum over a substantial period.

In autumn 1991, APEX was again in touch with my Department and with the Home Office as a result of its continuing financial difficulties. My Department has been helpful to APEX in a number of ways, as Baroness Seear has recognised. I am sure that the House accepts that it would be wrong to make payments of taxpayers' money to an organisation that is on the brink of liquidation. The trust has announced that it plans to call in receivers at the end of the week. I have today instructed my officials to get in touch with each of the training and enterprise councils which have contracts with APEX to make it clear that I expect them to ensure that all APEX trainees continue their training with other providers.

Mr. Blair

I thank the Minister for his statement. Will he agree with me that, if APEX Trust closes, over 130 trainers will be made redundant, hundreds of training places will go, and that it is unlikely, because of the nature of the work, that other organisations will take its place? Will he confirm that, up to today at least, not one word of criticism has passed ministerial lips? Indeed, the opposite is the case: it has been highly praised, not least by himself, for both its work and the manner of its operation.

As to the facts about the sum of £250,000, will the Minister confirm that a year ago, when it was clear that there would be a reduction in funding and employment training, APEX Trust entered into negotiations with his Department about the financing of costs associated with the closure of certain of its centres and the making redundant of about 100 staff; that APEX Trust then put to his Department a figure of £500,000 as the reasonable estimate of the cost of the rundown, and that this was agreed by his Department as a reasonable estimate; that on 20 March it was told that it would receive £250,000 as an advance, that on 27 March it received one payment of £250,000, and that on 16 April it received a further £250,000, making £500,000; that on two occasions APEX Trust called the Department of Employment, checked that it could go ahead and use this money and was told that it could go ahead and use it; that the Department of Employment's accountants spent some time with APEX in September, examining its accounts because of problems in relation to further funding; and that in early October, at a meeting with the permanent secretary to the Department of Employment, it was confirmed that any difficulties it had related to funding from the Government, not the running of its business, and its accounts were subsequently drawn up and certified?

To recap, will the Minister confirm that APEX sought £500,000, was given £500,000, checked that it was all right to use the £500,000, was told that it was and went ahead and used it? Will he also confirm that the first that the people at APEX knew about any difficulty with one of the cheques for £250,000 was a letter posted from his Department on Christmas eve and received on 3 January, demanding immediate repayment of one of the cheques and saying that it had been a mistake? As APEX has been given the money, taken it in good faith and used it, how can he justify attempting to snatch it back when the fault lies entirely with his own Department?

Are not the training places that will be lost at APEX part of a much wider picture—the closure of Fullemploy last week, the shutting of information technology centres throughout Britain, and the failure of the Government over their youth training guarantee which still persists even now? Will the Minister now admit what we have constantly said and what he has constantly denied—that training provision is being devastated by cuts in funding from the Government?

Will the right hon. and learned Gentleman confirm specifically that, according to his Department's own figures, 110,000 places have been lost for the training of young people and the unemployed in the past 12 months? At a time of recession, rising unemployment, bankruptcies and still crucial skill shortages in Britain, how can he justify the crass irresponsibility of shutting another training provider?

In relation to APEX and other centres, when will the Secretary of State and his colleagues realise that spending on training is not a cost but an investment in people that allows them to make a contribution to society and that is vital to the success of our economy? A Government who betray our country's training betray our country's future.

Mr. Howard

On the first question of the hon. Member for Sedgefield (Mr. Blair). I made it plain earlier that I have asked all the TECs involved to make arrangements for the continuation of training of those trainees who are presently receiving training under contracts between various TECs and APEX.

I said earlier that the circumstances surrounding the duplicate payment are under investigation. However, contrary to the hon. Gentleman's suggestion, and as I have already made plain, there is no question whatever of my Department seeking to "snatch it back"—to use the hon. Gentleman's words. We have made it clear to APEX that we are prepared to consider with it arrangements for the repayment of that sum over a substantial period. I hope that the hon. Gentleman accepts that we have a duty to recover taxpayers' money that was paid in error. That is what we are seeking to do, but in a manner that is as sympathetic as possible to any difficulties in which APEX may find itself.

There is no question whatever of that payment being the critical element of the difficulties in which APEX now finds itself. If the hon. Gentleman seeks to give that impression, he is misleading the House. APEX has made it clear, as it did at its press conference this morning, that it needs an infusion of a substantially larger sum of money if it is to avoid calling in the liquidators at the end of the week. It is wrong of the hon. Gentleman to suggest that that sum is the critical factor in the sequence of circumstances.

On training in general, I have made it clear on a number of occasions that we have a duty to those who require training, but that we have no duty to training providers. Other training providers have effectively adjusted to the changed circumstances in which they must now operate. It is a matter for considerable regret that APEX does not appear to have done so.

As to resources, the essential fact is that the Government are providing two and a half times as much money in real terms for training as was provided by the previous Labour Government. Whenever the hon. Gentleman says that the resources devoted to training are inadequate, the shadow Chief Secretary to the Treasury says that training would not be one of the two immediate spending priorities of any incoming Labour Government. The hon. Gentleman must not mislead the country by suggesting that the election of a Labour Government would lead to an immediate increase in training. The contrary is the truth, as the shadow Chief Secretary constantly points out.

Several Hon. Members

rose——

Mr. Speaker

Order. I remind the House that the private notice question that I granted was on the future of the APEX Trust. Questions should be confined to that, please.

Miss Emma Nicholson (Torridge and Devon, West)

Would my right hon. and learned Friend comment on the following phrase extracted from a letter of 2 December and repeated in a letter of 7 January: I wish to state for the record that Apex Trust is fully solvent and has over the last few weeks extracted itself from the TEC-caused cash flow crisis"? The Minister may like to know that that letter was written by the chief executive of APEX.

Mr. Howard

I understand that the letter was written then. All the circumstances of the matter will no doubt be investigated. The facts are as I recounted them in my statement.

Mr. Robert Maclennan (Caithness and Sutherland)

The House will be grateful for the Secretary of State's admission that the Government were responsible for the error of the payment of £250,000, but it will not be grateful for his failure to acknowledge that it is that which has tipped the company into liquidation proceedings. How can he make a lengthy statement from the Dispatch Box without even mentioning the predicament of the ex-offenders who have been served so nobly by APEX over the years? How can he fail to recognise that 65 per cent. of APEX's clients have been re-employed or given further education and training? For those who leave prison, reoffending is one of the major problems and prisoners are a third less likely to reoffend if they are employed as a result of the work of organisations with records such as that of APEX. The Government cannot wash their hands of the responsibility and must not knock that organisation, which has the best record for the re-employment and retraining of ex-offenders.

Mr. Howard

I paid tribute in my statement to the work that APEX has carried out, and I indicated my determination to ensure that proper arrangements are made for the continuation of the training of those presently in receipt of training. We give prisoners preferential access to our training programmes and shall continue to do so. Other organisations in that field, including specialist organisations, work to provide training for ex-offenders, and I have no doubt that they will continue to do so. Both my Department and the training and enterprise councils will continue to afford them every assistance in their valuable work.

Mr. John Biffen (Shropshire, North)

Has my right hon. Friend been advised as to what are the main factors leading to the financial crisis within APEX, and does he feel able to comment on that?

Mr. Howard

I was not present at the press conference that APEX held this morning and I have not yet had an opportunity to examine exactly what was said. On the information available to me, it is clear that the payment of £250,000 was not the critical factor precipitating the difficulties in which the organisation finds itself.

Mr. Ron Leighton (Newham, North-East)

My Select Committee produced a report on those matters in November. Is the Secretary of State aware that two thirds of adult males released from prison will be reconvicted within two years, but that those who obtain suitable work are three times less likely to reoffend? In that area, APEX has had 26 years' experience and in 1990 it helped 9,000 prisoners and ex-offenders with employment and training.

Two problems have hit APEX: first, the major cuts in ET funding from the Government, and, secondly, the fact that it must now negotiate with 82 different TECs, many of which have not given priority to that work or renewed the contracts. The Minister's Department gave money for closure costs. The Treasury is now asking for some of it back, and that is what has pushed APEX into insolvency.

Is the Minister aware that Judge Stephen Tumim, the chief inspector of prisons, told the Select Committee that he deplored the reduction in financial resources for APEX, and the National Association for the Care and Resettlement of Offenders. What he said is particularly important now. As Judge Stephen Tumim is against what the Minister is doing, may I appeal to him to go away, review the matter and return with a rescue package for that valuable organisation? It will not be cost-effective to shut it down.

Mr. Howard

The hon. Gentleman is right to stress the considerable importance of providing training opportunities for ex-offenders and those who leave prison. I am determined that arrangements for that training should continue to be in place, but that task is not the monopoly or preserve of a single training provider. Other training providers operate in that area and do valuable work. NACRO is the most conspicuous example and I have no doubt that NACRO and other organisations will continue to provide the valuable training to which the hon. Gentleman referred.

Mr. James Paice (Cambridgeshire, South-East)

I am sure that my right hon. and learned Friend will accept that many Conservative Members wish to pay tribute to the work that APEX has done and would be sorry if it were to go into decline or be liquidated. Does he agree that the principal need is for the training of ex-offenders, not to support any specific provider? If my right hon. and learned Friend were to intervene centrally to dictate to TECs over who should provide any particular type of training, that would undermine the central plank of the success of TECs.

Mr. Howard

My hon. Friend is absolutely right. If one takes the view, as we do and the Opposition—or at least the Front-Bench spokesmen—claim to do, that the devolution of responsibility for training to the 83 TECs is a sensible way of dealing with matters and should be supported, we must accept the logic that it is up to each TEC to make the appropriate arrangements for training in its district. We encourage TECs to make training available for ex-prisoners. I believe that the TECs take that responsibility seriously, but neither we nor they are committed to any particular training provider; the interests of trainees are paramount, as my hon. Friend rightly recognises.

Several Hon. Members

rose——

Mr. Speaker

Order. This is a private notice question, so I shall call two more Members from each side of the House, then we must move on.

Mr. Peter Archer (Warley, West)

In view of the Secretary of State's previous answer, does he not appreciate that NACRO schemes have also been decimated? If a former offender is prevented from reoffending, or if an offence that may have been committed is not committed, does that not represent a substantial saving to the Treasury? Would not those sums have shown a good return on investment?

Mr. Howard

NACRO continues in existence and continues to provide valuable training opportunities for ex-offenders, and I have absolutely no doubt that it will continue to do so.

Mr. John Bowis (Battersea)

I do not think that the overheated political response that we have just heard from the Opposition is very helpful. I can speak only for the Battersea branch of APEX, but I am sure that my right hon. and learned Friend would agree that it has provided an invaluable service to former offenders in that district. Does he also agree that, although we hope that APEX will continue, if that is not possible, it is important to ensure, as he wishes to do, that the training of ex-offenders continues? Will he talk to those concerned at the TECs to ensure that they fulfil the other half of the role of APEX: to educate employers so that they feel able and willing to take on former offenders once they have been trained?

Mr. Howard

I agree with my hon. Friend that that is an important matter. His question affords me the opportunity to emphasise not only the training role of APEX, which we very much hope will continue—perhaps through other means—but its other responsibilities. My right hon. Friends the Home Secretary, and the Minister of State, Home Office—my right hon. Friend the Member for Oxford, West and Abingdon (Mr. Patten)—who is present, are determined that the Home Office should ensure that the other work of APEX also continues.

Ms. Dawn Primarolo (Bristol, South)

Both Opposition and Conservative Members have this afternoon expressed their admiration for the APEX Trust. The Secretary of State was badly prepared to explain to the House how, if the Government were to fail to help the APEX Trust, he could ensure that his guarantee would be worth anything and trainees would find places in equivalent schemes through TECs. Will the Minister now undertake that he will make a further report to the House about saving APEX Trust and the negotiations taking place with his Department or, if not, about sound guarantees and named places for the transfer of those trainees who will lose their places?

Mr. Howard

The hon. Lady is entirely right to highlight the importance of ensuring that those who currently receive training from APEX continue to do so. The responsibility for delivering that training rests with the TECs involved. My officials are today in touch with the relevant TECs to emphasise the importance that we attach to maintaining training for those people. I am answerable, and will continue to be answerable, to the House for the training responsibilities of the TECs. The hon. Lady will have ample opportunity to question me about those and other matters in the weeks ahead.

Mr. Tony Favell (Stockport)

Does my right hon. and learned Friend, as a fellow lawyer, agree that many of the problems of prisoners stem from the fact that they have never done an honest day's work when they go to prison, and that far too many of them emerge from prison not having been properly trained to do an honest day's work? Surely we should concentrate our resources on training prisoners while they are a captive audience in gaol, not afterwards.

Mr. Howard

I note my hon. Friend's suggestion. We have looked carefully at the extent to which we can introduce effective training schemes for people who are in prison. More of that is taking place now than ever before. I agree that it is an important part of the measures that we should have in place to assist with the rehabilitation of offenders.