HC Deb 16 January 1996 vol 269 cc599-645
Mr. Deputy Speaker (Sir Geoffrey Lofthouse)

I have to inform the House that Madam Speaker has selected the amendment in the name of the Prime Minister.

7.16 pm
Mr. David Blunkett (Sheffield, Brightside)

I beg to move, That this House believes that the Government has failed to offer all members of society the chance to participate in building future prosperity; further believes that the Government has failed to achieve the investment in skills the British people need; deplores the cuts that have been made to the budgets of training and enterprise councils and the abandonment of the community action programme; and calls on the Government to ensure the workforce is equipped with the skills and training necessary to meet the challenges of the twenty-first century. It gives me pleasure to move this motion at the beginning of the Year of Lifelong Learning. It is a great pity that the Government's major contribution to that year is to cut training and education budgets, thereby undermining the life chances of those for whom skilling and learning are crucial, because they provide them with the tools to be able to earn their living and to contribute to society. The Government's record of the past year has been shoddy: cuts and the closure of programmes. The budgets of training and enterprise councils were cut by £197 million, and the Government had the cheek to take part of that money, invest it elsewhere, and then claim that it represented an improvement in further education.

The November 1995 Budget announced a proposed cut in the departmental budget of 4 per cent., with £75 million taken from the training budget alone in the coming year. There was an interesting sleight of hand in the form of the announcement that there would be an increase in spending on training of £50 million over three years, but a one-year cut of £75 million. Three down and two up is the Government's usual cack-handed way of taking with one hand while pretending to give with the other.

In every single major area of Government training programmes there has been a reduction in funding, at a time when people who are unemployed and seeking work have been more desperate than ever for an improvement in the availability of the skills that they need. Seven hundred and thirty thousand young men and women between the ages of 16 and 25 have no job and no training and are not in any education place. Nearly 300,000 of them have been unemployed and without a place for more than six months.

Special needs training and education have been drastically affected. A recent report by the training and enterprise councils in the voluntary sector showed a general 10 per cent. cut in the number of starts for those with special needs in the past 12 months; in some parts of the country there have been cuts of a staggering 40 or 50 per cent.

The switch to outcome measures has provided an incentive not to get young people into work but to get them out of the dole queues and off the register, whatever the consequences in terms of failing to give them qualifications that would equip them with the portable knowledge and skills to be able to return, time and again, to the job market and take up paid places in work.

Mr. John Sykes (Scarborough)

Why should the Government or the Conservative party take any lectures from the Labour party or from the Minister about the jobless and job opportunities when the hon. Gentleman's party wants to impose a social chapter on this country's employers?

Mr. Blunkett

I will tell the hon. Gentleman why they should take lectures. The Government have tripled the number of people who are unemployed, even on existing figures and by taking into account the 20 or 30 adjustments to the unemployment statistics and the way in which the Government have treated the training budget.

Mr. Sykes

What about the social chapter?

Mr. Blunkett

All we get is a very silly heckle of "What about the social chapter?" Unfortunately, even if we had signed the social chapter, it would not have protected us from the cuts and closures that the Government are inflicting on those seeking training and wanting work. The Minister—I nearly said the shadow Minister, seeing as I have been described as the Minister. The Government are so used to putting themselves in the place of the Opposition and thinking of us as the Government that it is quite hard not to predict too soon the outcome of the next election.

Mr. Sykes

Will the hon. Gentleman give way?

Mr. Blunkett

I will not give way again for the moment. I will make some progress.

I remind the House that on 7 January, the Secretary of State for Education and Employment was reported in a Sunday newspaper as having the cheek to say that getting a job made the unemployed happy. I thought that that showed the cheek of the devil for somebody who has been responsible in a Government who have accelerated unemployment over the years to the point where they can claim credit for a slight drop in the number registered as unemployed.

I return to the key issue of those with special needs who have been denied training and therefore the chance of a job because of cuts and closures. I return to the way in which the training and enterprise councils have been cut, the way in which the budget for training for the coming year has been reduced, and of course the way in which training has been switched to short-term rather than long-term provision to provide qualifications for life.

We need to debate a very serious issue. Are we a low-tech, low-wage, low added value economy that has short-term measures to get people off the dole queue, or are we a high-tech, high-wage and high-investment economy that skills people so that they are able to earn their living, add value at work to the amount that they are paid, contribute to society and, above all, have the knowledge-based skills to carry them through an ever insecure and uncertain jobs market?

The security that we can provide by equipping people with the ability to move from job to job and from workplace to workplace and to re-adapt several times in their working life is crucial to the future of Britain. That is why we are condemning the Government not only for the cuts that they have made but for the short-termism that underpins them.

If there is a reduction—the Government have reduced the budget for special needs training—in the long-term emphasis on gaining qualifications, people become equipped people only for further unemployment and short-term relief. They end up being placed in a short-term, low-paid job only to find themselves back in the dole queue through a revolving door. That is obviously short-sighted and extremely unproductive for our needs as a nation.

Our emphasis on providing a stakeholder economy in a nation that pulls together—[HON. MEMBERS: "Ah."] I hear some "Ahs" from Conservative Members. Our emphasis is on a stakeholder economy provided by the Labour party, rather than a Burger King economy provided by the Conservative party of fat cats and hot dogs instead of investment in long-term training and skills to enable people to do a job.

Comments that have been made on Grand Metropolitan remind me of the way in which the Government have undermined the careers service, which, as we have seen in south London, is crucial to training and employment.

Mr. Sykes

On the subject of burgers, the hon. Gentleman will know that there is a large manufacturer in my constituency that supplies various food chains with a specific product. People in my constituency have been guaranteed jobs because that company could not afford to build a factory in France due to the costs of the social chapter and the minimum wage. What did the company do? It doubled the production line in Scarborough instead, thus guaranteeing the jobs of my constituents. How does he answer that?

Mr. Blunkett

I do not need to answer it because it is patently obvious that companies which locate in France—companies have moved from Scotland to France as well as from France to Britain—have seen the value in France, Germany and Italy, as they do in the Pacific rim, of investment in long-term skills. If the answer to the question of whether we should invest in a knowledge-based, long-term skills economy of the 21st century is a Conservative Member saying that the Government's solution is to make our wages as low as possible in order to attract people to re-locate in Scarborough, the division between the two parties is clear.

The division lies between a vision of Britain at the cutting edge of the world economy being able to compete with the Pacific rim countries, and a country that is determined to be on the fringe of Europe—a kind of offshore, floating low-wage zone in which Ministers do not seem to have grasped the fact that the biggest change in the past decade has been a drop in the demand for unskilled labour and an increase in the demand for those who could add value through their skills in a high-tech, information and communications era.

Information and communications technology, and not the ability to fill tubs with mince, has to he the way forward for this country. Low wages will not get Britain out of economic recession. Investment in skills will put us ahead of the Germans, the South Koreans, the Taiwanese and the Singaporeans.

One need only ask the Deputy Prime Minister that. He flew to Singapore to find out how they do it, but the Leader of the Opposition had already been. One need only ask the Deputy Prime Minister, since last year, over the head of the Secretary of State for Education and Employment, he started to undertake a skills audit. One need only talk to the Chancellor of the Exchequer, who made it absolutely clear on the Radio 4 programme "UKplc" at the end of 1995 that there had been years and years of under-investment in skills for the future of this country.

I suggest that Conservative Members listen to the Deputy Prime Minister and the Chancellor of the Exchequer before yah-booing such future needs and skilling. Why has the Deputy Prime Minister undertaken a skills audit? Why is there universal acceptance that there is a major problem in the skills available in this country? Why did the survey, "Skill Needs in Britain", published in December, acknowledge that there had been a jump of 75 per cent. since 1994 in the number of companies in this country that perceive a skills gap?

That is not my perception or that of the Labour party. It is the perception of industry across the country. Furthermore, 43 per cent. perceived a shortfall in technology skills and 30 per cent. perceived a shortfall in basic manufacturing skills. We know that that is correct because the CBI has published a report, backed up by the Trades Union Congress, on the need to invest in a different sort of economy for a different millennium. The divide between the parties lies in the recognition of that need.

The report sneaked out by the Government in December, called "Lifelong Learning"—we obtained a copy and published it a fortnight before the Government released it—had only one thing going for it: it at least acknowledged that the Government were falling short of their own targets. Let me spell out some of the targets that have not been met. A total of 55 per cent. of our 17-year-olds stay on in full-time education. In France the figure is 87 per cent. and in Germany it is 93 per cent.

Mr. David Shaw (Dover)

They have higher unemployment.

Mr. Blunkett

So I presume that the higher the unemployment figure, the more people stay on in education. If that were true, at the height of the Conservative-engineered recession in the early 1990s, our nation would have had some of the best figures for those staying on. The number of those staying on at 16 fell last year. I assume that there is a corollary and that because the Government have made up work make schemes and are now prepared to cut them, we will see an increase next year in the number of young people staying on in full-time education.

Mr. Shaw

Will the hon. Gentleman give way?

Mr. Blunkett

I certainly will because I would love to be enlightened on this intellectually robust point.

Mr. Shaw

When one compares France with the United Kingdom, surely one of the key points is that a young person in France stays unemployed for 22 months whereas, on average, a young person in the United Kingdom is likely to get a job after nine months. Is not one reason why the French young are so desperate to stay on in any form of education possible the fact that the minimum wage has prevented them from having opportunities for employment?

Mr. Blunkett

Intellectually, this would be a useful argument if it were not for the fact that in America, which is used as the exemplar of right-wing market economics, there has been a minimum wage and it has not affected the number of young people obtaining jobs.

Mr. Shaw

Will the hon. Gentleman give way?

Mr. Blunkett

No, because the hon. Gentleman's greatest contribution in the debate about France and Britain was to suggest that the harbour in Dover should be given away to the French. I suppose if proximity to France had enlightened the hon. Gentleman, he would have made a better contribution today.

Mr. Shaw

The hon. Gentleman has tunnel vision.

Mr. Blunkett

I like that joke about me having tunnel vision. That was very amusing and I will set my dog on the hon. Gentleman.

What about the targets that the Government set themselves? What about the 80 per cent. of young people who are to gain intermediate skills such as the GNVQ intermediate or five GCSEs at grades A to C by 1997? When it became clear that the Government were nowhere near that, the goalposts were changed and the target was set for the year 2000. It was also slightly adjusted and was made 85 per cent. for 19-year-olds. How are we doing at reaching that target? So far, we have managed to get two thirds of the way.

We have seen a similar shortfall in the number of adults receiving advanced qualifications below degree level such as the GNVQ advanced, BTEC national or A-levels. Britain has a figure of just over 40 per cent., whereas the Japanese attained the targets set by Britain 10 years ago. The Germans have exceeded the target and the French have a target of 80 per cent. by the year 2000, not 60 per cent., which is what we have set ourselves.

It is a sorry picture. There are targets that cannot be met and the Government are cutting back at the very time when those targets need to be attained. We have seen cuts in not only the training budget but in further and higher education. Fancy cutting two thirds of the capital budget over the next three years for the further education sector at the very time when we should be encouraging more young people to go into full-time education. Are we doing that? A few moments ago Conservative Members committed themselves to encouraging young people not to go into full-time education but to get the cheapest job possible on the ground that the more people who go into full-time education, the more desperate they must be. What a pathetic state we have reached.

Mr. Roy Beggs (East Antrim)

The hon. Gentleman referred to cuts. Will he join me in condemning the 25 per cent. cut-imposed on the action for community employment scheme in Northern Ireland? Does he agree that it is unmanageable and irresponsible to expect those cuts to be made by 31 March this year? Does the hon. Gentleman agree that the Government would serve the community and the long-term unemployed better by increasing funding for those community projects and by properly supervising the 240 of them across Northern Ireland, to ensure that the skill level of the long-term unemployed is raised and that the necessary community services provided for the needy can be maintained?

Mr. Blunkett

I agree with the hon. Gentleman. The link between providing real experience, community skills and training is critical. As I shall show, the Government have disregarded the idea that placing people in work and on community experience is good for them because it is too expensive. Accelerating closure demoralises those at the sharp end—those on the schemes—and undermines the confidence of providers who believe that they can be let down by the Government abandoning them at any moment.

The OECD recently put us at 18th out of 25 in the skills attained by our people as a whole. The World Competitive Forum put us 24th in terms of people skills and 35th in educational attainment. Again, Conservative Members are having a little chuckle. I do not think that there is much to laugh at.

Mr. Ian McCartney (Makerfield)

We are not talking about everybody's children.

Mr. Blunkett

Yes, as my hon. Friend reminds me, some people's children are doing all right because they can be supported and encouraged. We are talking all the time about helping those who are least able to help themselves. That is what one-nation Britain is all about. It is not just about looking after an elite and patting on the back those who happen to have had private education or who can succeed because they are funded through higher education. It is about ensuring that we look after those with no prospects such as the 700,000 to whom I [...]referred earlier, the 280,000 under-25s who have been out[...] of work for over six months, the 443,000 adults who have been out of work for over two years and the 750,000 who have been unemployed for more than a year. Those are the issues that we should be debating. Tonight's debate is important not just because it is about the future of Britain's economy, crucial though that is, but because it is about the well-being of individuals. If we are to have social cohesion as well as economic prosperity, we need to provide opportunities for every young person so that they are not on the streets or lying in bed but in work, doing work.

There are some important schemes. We agree with the modern apprenticeships and the accelerated apprenticeships. The programme to encourage firms to become investors in people is crucial, but instead of 8 per cent. we should aim for 80 per cent. of firms to become involved in that. We should encourage partnerships and develop the best of business partnerships from school through to work with local authorities. That has been done in Leeds by Leeds city council, the Benefits Agency and the training and enterprise council. We need positive moves to use the resources at our disposal to encourage and support people in their endeavour to find work. We are not talking about punishment or the jobseeker's allowance, which will be debated in the House tomorrow, or about threatening people or introducing a project work scheme that is deliberately and calculatedly designed to provide a shoddy and unacceptable alternative.

On 10 March last year the community action programme was supposed to be the great programme for the future. On that day, the Secretary of State's predecessor, the then Secretary of State for Employment, said—this was one of his most positive moves— Over the next three years we are planning to extend the successful community action programme, which provides work experience and a route back to jobs for long-term unemployed people. It was due to end next year but we shall now provide 40,000 opportunities a year for the next three years. That lasted only eight months. The Budget then overtook it and the Government changed their mind and abandoned the scheme. We must examine why that happened. In putting forward the project work scheme, the Government claimed that it would represent value for money and be a new idea. They said that the pilot schemes would provide a better alternative than schemes previously in place, and that the project work scheme would be a boon for those who had been out of work. It does not look that way when we examine the briefings given to Ministers.

One briefing note was entitled: Briefing for Ministers on the Budget. Requiring activity pilots: lines to take. The advice given on the project work scheme was: This approach is new and will not he cheap. We do not throw money away on programmes that do not work. I shall examine that advice in terms of the £98 million that was spent in 1994–95 on the community action programme, and compare it with the advice in the same briefing note to Ministers, which describes the programme as "community action closure". Under the heading, Questions that Ministers might be asked", it says: Why are you closing community action when it has been such a success? and advises that the Minister answer: You will be aware that all Government Departments' budgets have been under very close scrutiny this year. It was quite clear that money would not be available for community action to continue at current levels. It was generally accepted that community action could not remain viable as a national programme if places were cut further, and closure, leading to the provision of its cheaper alternative, was seen as the preferred option. That note reveals that finding a cheaper alternative was the most important priority and that the prime decision to cut community action was being taken not because the programme was not working—the Government proclaimed that it was and said last March that they would expand it—but as a straight budgetary cut.

The next question in the briefing is even more revealing: I know that the public position is that recruitment stops after 29 December but should we really continue with referrals up until then? The crucial answer is: Yes. Community action has been a popular and effective programme, and it is important that it is run down and closed in an orderly way. Money is available for this run down and it is important that we spend this on continuing to help as many people as possible in the interim.

Mr. Ted Rowlands (Merthyr Tydfil and Rhymney)

I apologise to my hon. Friend for interrupting his flow. Is he directly quoting or paraphrasing? If he is directly quoting the advice of Government officials to help Ministers answer questions that may be asked, the line that they take is familiar to those of us who have been Ministers.

Mr. Blunkett

They are direct quotations from a document that briefs Ministers, and they show clearly the thinking behind what was going on. The advice was not terribly wise, but nevertheless it was given to Ministers, which is why the Government are gradually grinding to a standstill after 17 years. I shall not quote the rest of the document—[HON. MEMBERS: "Go on."] I shall quote just one more question and answer. The question is whether work of value to the community would now be carried out, and the wonderful answer is: Community action was always primarily about helping people to find jobs wait for this not creating useful work opportunities for the sake of it. No wonder I was intervened on.

An article in a Sunday newspaper on 7 January gave the game away on how the Government regard those schemes. It quoted the Minister as dismissing placing people in community programmes as being some kind of alternative to the makeweight that those pilot schemes are all about.

We are discussing a programme of cutbacks in training, the abandonment of community action programmes and a belief that a cheap alternative to programmes that have worked must be put in place. The Government have introduced change after change, which has disrupted not only the poor devils trying to get work or return to work but those desperate to provide that work. It has disrupted those in the community who set up and worked on those schemes. It undermines training and enterprise councils' programmes and programmes for young people as well as old.

What sort of Government proclaim in the Budget that they care about the long-term unemployed and then cut the training for work programme by 15 per cent., after an 18 per cent. cut in the previous year's estimated budget—£574 million cut to £488 million? What sort of Government pare back youth training, reducing the unit cost from £32 last year to £28 this year, having reduced it from an average unit cost of £50 four years ago? It is mean, petty and short-sighted—short-termism of the worst order.

No wonder Conservative Members defend Burger King. That is exactly what their Government are like. They seek the lowest possible pay with the least possible investment in the future. They will be swept aside because we talk of giving everyone a stake in society.

7.46 pm
The Secretary of State for Education and Employment (Mrs. Gillian Shephard)

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof: welcomes the fall in unemployment and rise in employment that have enabled more people to share in the benefits of economic growth; supports the Government's determination to give unemployed people the help they need to find work; and welcomes the Government's initiatives to raise standards of education and training and enhance the nation's competitiveness.". I am indebted to the hon. Member for Sheffield, Brightside (Mr. Blunkett) for giving me so early in the new year a chance not only to set out for the House the Government's achievements in constructive and effective action to help unemployed people back to work but, more importantly, to explain to him and his hon. Friends a few facts of life. Disappointingly, all that we heard from him was the usual catalogue of woes, the usual implicit demands for more money, regardless of circumstances, and the usual refusal to face up to the consequences for employment of his policies to embrace the social chapter and a national minimum wage. As usual, he refused to recognise the fact that, next year, investment in education will be £878 million and we shall provide an extra £30 million for the careers service. Our training strategy, as laid out in the White Papers on competitiveness, is backed with £300 million of new money for real investment and is getting results.

Mrs. Bridget Prentice (Lewisham, East)

Will the Minister give way?

Mrs. Shephard

I shall give way in a moment.

The hon. Gentleman also refuses to accept simple facts, such as the fact that this country has only 5.7 per cent. of its work force on short-term contracts, whereas France and Germany have double that number and Spain has more than 30 per cent. It is also sad that he spent half an hour talking Britain down. He spoke of world economic forums. The so-called findings of the World Competitive Forum, whoever that is, are at odds with recent Organisation for Economic Co-operation and Development reports.

The OECD puts Britain second only to Denmark among European Union countries; on graduation rates, in the top five; and on spending per student, the highest in the European Union. During 1995, the OECD praised the increased number of young people obtaining good qualifications, the upgrading of labour force skills levels, the rapid take-up of general national vocational qualifications, the introduction of modern apprenticeships, the success of training and enterprise councils and the substantial rise in participation rates in education and training post-16 over the past decade. Of course, the hon. Gentleman does not wish to mention any of that. No wonder he asked for enlightenment. He thought that he had found it in a stolen document.

Mrs. Prentice

The Secretary of State mentioned both the careers service and the training and enterprise councils. The young people of south London first lost South Thames training and enterprise council because of the debacle there and are now waiting for a careers service to be established on 1 April. Grand Metropolitan has received a spurious title of preferred bidder status from the Secretary of State, despite a much better, well-thought-out bid by local authorities. Exactly what guidance will she give young people in south London about where they should go post-16?

Mrs. Shephard

I am confident that the well-resourced education and further education sectors in south London will be able to provide for the needs of the constituents of the hon. Member for Lewisham, East (Mrs. Prentice). I am also confident that there will be a good, effective careers service in place.

Governments cannot create jobs; businesses do. What Governments can do is to create the conditions for healthy economic growth and get rid of unnecessary legislative burdens that would deter employers from recruiting additional people as sales and output rise.

Only Opposition Members would launch a debate on employment that ignores the economic facts of life. Only they could ignore the unmistakable successes of the past three years: steadily falling unemployment; growth in jobs; a healthy flow of inward investment; and the lowest level of industrial disputes since records began. That, of course, is because they do not like to hear about success.

When the economy began to recover from recession in 1992, what did we hear from the Opposition? We heard that Europe, and Britain with it, faced a period of growth in joblessness. For Europe as a whole, that prediction has proved uncomfortably close to the truth, but for Britain it has proved wrong. Of course, we heard from Opposition Members that Britain, like the rest of Europe, faced permanently high unemployment. What did the hon. Member for Dunfermline, East (Mr. Brown) warn us in his best sepulchral tones? He said: both unemployment and inflation are likely to rise".—[Official Report, 24 September 1992; Vol. 212, c. 94.] He was wrong again on both counts.

There are now nearly 750,000 fewer people out of work and unemployment has fallen for 27 months in a row—it was down another 20,000 last month alone.

Mr. Michael Meacher (Oldham, West)

Before the right hon. Lady seeks to take credit for the fall in unemployment, such as it has been, is she aware that the cause of that fall has nothing to do with the Government's employment or training programmes and everything to do with their failure to achieve the linchpin of their economic policy, which was to maintain our position in the exchange rate mechanism at a highly overvalued rate? If the Government had succeeded, none of what she now claims would have occurred. Does she accept that?

Mrs. Shephard

I expect that the hon. Gentleman would like to say something about his party's policy ambiguities in respect of the single currency. No doubt he will come to that when he winds up.

Mr. Meacher

Answer the question.

Mrs. Shephard

I am about to do so. It is the Government's labour market reforms and sound economic policies that have caused unemployment to fall faster and further than in other European Union countries. If the hon. Member for Oldham, West (Mr. Meacher) does not want to take my word for that, as he patently does not, let him take that of the OECD.

Of course the recession years hit Britain; they hit everyone. Unemployment, at around 8 per cent., is still too high, but unemployment in Britain is lower than in Germany, where it is 8.5 per cent.; well below that of France and Italy, where more than 11 per cent. are out of work; and spectacularly lower than in Spain, Europe's last socialist stronghold, where the social chapter and statutory national minimum wage of the kind proposed by the Labour party have created unemployment of 22 per cent. That is what I think is meant by a stakeholder society: regulation piled on regulation; industry held back by the trade unions; bureaucrats controlling every aspect of people's lives; and one in five people out of work, as in socialist Spain—a stake right through the heart of British enterprise and opportunity.

The reforms of the past 16 years have transformed Britain's labour market. Job growth between 1979 and 1989 was among the fastest in Europe—higher than in France, Italy or Germany. Three times as many new jobs were created in those 10 years as in the previous 10 years. Already, since 1992, more than 500,000 more jobs have been created and unemployment has fallen by nearly 750,000. Every region of Britain and section of society is benefiting. We have fewer men out of work, fewer women out of work, and fewer long-term unemployed.

Mr. Gerry Sutcliffe (Bradford, South)

It is interesting to hear the Minister recount those figures about how good everything is. Why is it that in Bradford, one third of the population is on some form of income benefit? The Government are doing nothing to solve the problem of long-term unemployment.

Mrs. Shephard

As I have just said, every region of Britain, including the north, has benefited from the fall in unemployment. The north of England and Northern Ireland have the highest unemployment, but it is still lower than average unemployment in the European Union as a whole.

In the 1970s—the last time that the stakeholders ran Britain—the north-south divide was a reality. There is now a smaller gap between the regions with the best employment and those with the worst unemployment in Britain than in any other European Union country. The north-south divide was a reality in the 1970s. Unemployment in Scotland, Wales and northern England was well above that of more prosperous regions. Now unemployment in Wales is at the Great Britain average and in Scotland it is below average.

It would be interesting for Opposition Members to compare our regions with those of our European partners: Calais, for example, has unemployment of 16 per cent.; in Mecklenburg, it is over 18 per cent.; in southern Spain, one person in three is unemployed.

It is against that background, that change in the labour market, that good news—which I can see that Labour Members are delighted to hear—and that fall in unemployment, that we should set our changed priorities in help for unemployed people.

Priorities have to change with changing times, but the fundamental aim remains the same: to offer individual people the help that they need to get back to work as quickly as possible. It is the task of a responsible Government to give unemployed people that help. As the economic background changes, so the programmes must change to give people the help that they need.

Today's labour market is buoyant. In November alone, in just one month, nearly 250,000 new vacancies were notified to jobcentres—the highest figure in any single month since records began. More than 7 million jobs become vacant every year. A quarter of people who become unemployed leave unemployment within a month, half within three months and about two thirds within six months. The Employment Service placed a record 2 million people into jobs in the past year. As jobs are more available, it makes sense to tilt the balance of our programmes increasingly towards helping people with job search.

The number of opportunities for unemployed people will remain the same—1.5 million—even though there are fewer people out of work. Community action is to end because help needs to be focused more precisely and its place is to be taken by around 240,000 places, double the current number, on 1-2-1 to provide intensive help and counselling to unemployed people. There will be more help with job search. Under the jobseeker's allowance, every unemployed person will have a jobseeker's agreement that will set out the steps needed to help get them back to work.

Mr. Rowlands

I have been following the right hon. Lady's speech closely. Will she confirm that the document from which my hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) quoted was not drafted by a Department, but offered the considered view of officials and Ministers about the community action programme?

Mrs. Shephard

I make it a practice never to comment on stolen documents, which I have said before in the House.

The hon. Member for Brightside rightly mentioned that people with special needs require special help. I shall outline that help in a moment. The Employment Service will spend more time with jobseekers, reviewing their progress and giving help and advice.

In April 1996, we shall introduce new project work pilots for 6,000 people in two areas. In the pilot areas, people who have been unemployed for more than two years will be given 13 weeks of the most appropriate help that the Employment Service can offer, which will be followed by 13 weeks of work experience for those who remain unemployed. The aim is to concentrate work experience on those who most need it.

Around 21,800 severely disabled people will be helped in supported employment in 1995–96, at a cost of around £153 million.

Mr. Ian McCartney

Will the pilots operate in travel-to-work areas or in constituencies?

Mrs. Shephard

That has been announced; the two areas are Medway and Hull. I should be happy to give the hon. Gentleman the details if he wishes, but I believe that his colleagues have the information already.

Placing, assessment and counselling teams, PACTS, will provide an integrated, flexible and local specialist service for more severely disabled people, and will include access to supported employment. PACTS will give advice and practical help to employers to assist, recruit, train and retain disabled people.

Training and re-skilling are also a key part of the strategy for improved economic performance—I think that we are all agreed on that at least. To compete successfully in world markets, clearly the United Kingdom and its companies must have a highly skilled, flexible and adaptable work force. We are committed to creating the conditions that will help to achieve that goal, which lies at the heart of the agenda for the new merged Department for Education and Employment. The merger has been welcomed by almost everyone, including some of the stakeholders—though not by the Labour party—so that we can bring together the workplace and the classroom to make what is done in schools, colleges and universities relevant to the workplace.

We have national targets for education and training, which I certainly accept are ambitious and challenging. They are aimed at fitting Britain's economy and people for the 21st century. The two competitiveness White Papers lay out the strategy for achieving those targets, and we have backed it with £300 million.

Britain, uniquely, has a national network of training and enterprise councils, which are committed to achieving the targets. The TECs are creating better local training provision, helping local people and helping to regenerate local economies.

National vocational qualifications are increasingly being used, and more than 80 per cent. of the working population is covered by them. I had the pleasure of awarding the millionth just before Christmas. More young people are learning about the world of work through work experience, and we are supporting arrangements to make it available to pupils in their last year of compulsory schooling.

People are increasingly taking up 'or continuing education and training, and 84 per cent. of the work force has a qualification. TEC expenditure, contrary to the remarks made by the hon. Member for Brightside, is set to rise, up 5 per cent., to £1.4 billion, above the expected expenditure in this financial year. The budget for youth programmes will rise by more than £100 million against forecast expenditure next year.

Modern apprenticeships are a serious and major reform of our training system. More than 50 sectors now have training frameworks, and recruitment has started in all English TEC areas. The training for work budget is being scaled down precisely because there has been the fall in unemployment that I have described, but the provision for people with special needs will be retained at existing levels.

Training for work remains a major programme, and quality will be improved to increase the emphasis on improved job outcomes.

Mr. Blunkett

Can the right hon. Lady tell me why the budget of the access to work project has been frozen? Why are the Government proposing to reduce drastically availability of that key bridge between training and equipping for work and the opportunity for disabled people to get work?

Mrs. Shephard

The budget of the access to work programme has already been exceeded during this year by some £6 million, so we are having to put a ceiling on expenditure this year. Meanwhile, we are consulting on the way forward for next year.

Unemployed people are not a single lump; they are individuals—people of all ages, all backgrounds and with very different hopes and aspirations. No single programme is right for them all—some need re-skilling; some need work experience; and others need help with job search. Individuals differ, and their needs differ, which is why we have a mix of programmes and the flexibility to adapt them to suit individual needs.

We shall continue to pay particular attention to those with special needs. The Government are committed to maintain the current volume of trainees with special needs, which includes those with disabilities, on the training for work programme, despite a reduction in the size of that programme. Disabled people will remain eligible for that programme without having to satisfy the six-month unemployment criterion.

We believe in giving opportunities and rights to individual people, to real people of flesh and blood—not stakeholders. We want a society in which people are in charge of their own destinies; a society where people have rights, opportunities and choices.

Since 1979, we have given the people a real stake in society. We have handed the trade unions to their members; we have given parents the right to choose schools for their children and given people ownership of industry in a share-owning democracy. That is a society of opportunity and choice, with real participation in the choices that all of us face in everyday life.

The people welcome those opportunities, and will not accept a return to the bad old days when the stakeholders ran Britain, and ran it into the ground. They will not accept more regulation or more taxation. They will not accept more bureaucrats telling them how to run their businesses and how to run their lives.

On Sunday. the hon. Member for Brent, East (Mr. Livingstone) let the cat out of the bag—a Labour Government, he said, cannot govern without the support of the unions". I agree. No Labour Government have ever governed without the support of the trade unions because no Labour Government can afford to ignore their paymasters. Unlike the right hon. Member for Sedgefield (Mr. Blair), the hon. Member for Brent, East at least had the honesty to admit that, and to admit it publicly.

But I have news for Opposition Members: now that the truth is out, the people can make a real decision about what is on offer. In the 1970s—the days of the stakeholder society—Government, big business and the trade union barons took decisions on people's behalf. Of course, we are told that under new Labour there will he no return to beer and sandwiches in smoke-filled rooms. Of course not, because under new Labour it would be deals over smoked salmon and dry white wine in a smoke-free zone. It is a case of new packaging and old ideas.

People will not accept a Britain where public services are provided on a take-it-or-leave-it basis, with only the rich able to choose for themselves which school is right for their child. People want a society in which they as individuals have a stake. For most people, the biggest stake they have in society is their job. Jobs give people not just income, but self-confidence and self-respect. That is why the priority must be to create more jobs. That is why policies that destroy jobs—the social chapter and the national minimum wage—the policies to which the Opposition are signed up, are such a cruel fraud.

That is why the Government will continue to give priority to creating an economy that continues to deliver the jobs that people want.

8.8 pm

Mr. Ted Rowlands (Merthyr Tydfil and Rhymney)

Earlier, my hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) referred to the phrase "line to take" that appeared in a document. I have a feeling that the Secretary of State has made a speech using the line to take on stakeholders issued by Conservative central office. I think that what we have heard will become a familiar refrain. I do not know in which society or world the right hon. Lady is living, but she has not described the world or community that I represent.

I shall tell the right hon. Lady a fact of life over the past 15 years: the Government believe that the frontiers of the state should be pushed back, but the state has never been more intrusive in people's lives. More people than ever before in post-war Britain are dependent on the state because of the cumulative effect of Government policy. The state intrudes into people's lives because they have had to become more dependent on it because of rising unemployment and growing dependency on benefits. The Secretary of State may talk about an enterprising society and choice, but as a result of Government policy an increasing number of my constituents have been forced into a new dependency culture that they do not like and did not want.

I should have hoped that, if nothing else, there could be a basic consensus on the subject of training. I think that hon. Members on both sides of the House agree that training and skills will be vital to competitiveness. In a world of global trade and transfer of production, one factor that national Governments can still influence, alter and support is skills training. As that issue is crucial, we should analyse what the Government have or have not done about it.

I have been a strong supporter for a considerable time of training programmes in my constituency produced by Ministers and a succession of Secretaries of State for Wales. I promoted and supported modern manufacturing schemes introduced by successive Secretaries of State including the right hon. Lady's immediate predecessor, the right hon. Member for Wokingham (Mr. Redwood). The right hon. Gentleman came and supported the sort of schemes that we have been backing in Merthyr.

Over the past 15 or 20 years, there has been a bewildering series of changes in the programmes, which have been set up and then closed. We do not believe in the pick-and-mix approach described by the Secretary of State. The changes have often been driven by Budget changes from one year to the next. Some years a lot of money has been thrown at training programmes, and in other years programmes have been cut, almost overnight. Those changes have created in many people, particularly young people, resentment towards training—they feel alienated. Many people, particularly young people, now take a cynical approach towards the schemes and no longer believe in training. That development, which has been caused partly by the chops and changes made to training programmes over the years, is worrying and must be overcome.

One in five school leavers in Mid Glamorgan cannot be accounted for: they are not involved in training or further education; they do not collect the dole and they do not claim benefit. They have simply disappeared from the system. One in five school leavers in Mid Glamorgan no longer have any connection with the system: they are not scrounging or claiming benefits and they are not following training programmes. I suspect that that large and worrying core of school leavers will provide the basis for future problems and concerns in our society.

That worrying core of school leavers has been created partly because they no longer believe that community and Government training programmes will meet their needs, and who can blame them? Surely the Secretary of State knows that community action provided one of the bridges between welfare and work. I should have thought that there would be a consensus on the need to build bridges and make the connection between welfare and work. But the community action programme, which was one of those bridges, was blown up overnight. Despite the references in the leaked document to the quality, usefulness and popularity of some of the community action programmes, that bridge will now he blown up.

The community action programme is to he blown up without any assessment of the consequences. I asked the Secretary of State for Wales—the Welsh Office has responsibility for training in Wales—to tell me about the community action programmes. I received a written answer to my question stating that he did not know. The Welsh Office does not know about the programmes that it has suddenly decided to close—it does not have a list or any idea of the programmes' character. In a written answer the Welsh Office said that the information was not available centrally. Presumably, the Secretary of State sat at the Cabinet table and nodded through the closure of the community action programmes without any knowledge or detailed understanding of them.

Many of the people who have been involved in the community action programmes over the years have felt that they were not always good, did not offer much training and were, in some cases, half-baked, but they felt that the programmes provided a necessary link to work. The people involved in the community action programme are those least likely to obtain employment. The Government used falling unemployment as their basic excuse for closing the programme.

I am worried that those involved in the programme will not obtain employment. They arc people with special needs and less ability and aptitude than others; such people require the community action programme as they will not automatically gain maximum benefit from the improvement in local employment prospects. They are the victims and are less likely than others to obtain jobs. The right hon. Lady and the Government have closed one of the programmes that provided a bridge between welfare and work.

Has the Secretary of State followed what has happened to the training for work changes that have been implemented and the introduction of the outcome-related schemes? Have the right hon. Lady or Ministers tried to find out what is happening in relation to training for work? It has increasingly turned out to be nothing more than an employment subsidy. I am not necessarily against employment subsidies, but it seems strange for the Government to propose them. Training programmes have shrunk and almost disappeared, and most training providers are paid to move people into employment as quickly as possible, irrespective of the quality or character of the job and irrespective of the potential employee's training or vocation.

I do not know whether my hon. Friend the Member for Oldham, West (Mr. Meacher) will quote from the Coopers and Lybrand report on the programmes, which spelt out the point that I just made. On the Government's changes to the training for work programme, the report states: training providers cannot actually create job opportunities but they can create training opportunities which are likely to improve a trainee's future employment potential. That is the one goal that the training for work programme is not achieving—it is not training a trainee so that he or she has the potential for employment. In most cases, it moves people into work as quickly as possible, irrespective of their skills or training. The programme might sound like a good idea—no one is against it—but it is not a training programme. It is an employment subsidy. There may he a case for employment subsidies, but the programme is not a training scheme.

How can we square that approach with the desire to lift skills and achieve targets for NVQ3 and NVQ4? The Secretary of State might not know about it and there is no Welsh Office Minister present, but only this week a new report on the 1994 Welsh training and education survey was published. It sets up targets for NVQ3 and NVQ4 to be achieved by the year 2000. The aim is that 60 per cent. of people in Wales should achieve NVQ3 by the end of the century. The figures show that at present only 39 per cent. are achieving that goal. How does the right hon. Lady think that the targets will be achieved when the training for work programme and many other skills and training programmes are diminishing?

In the county of Mid Glamorgan, a part of which I represent, only 42 per cent. of men and 29 per cent. of women have the equivalent of NVQ3 qualifications. We are supposed to reach 60 per cent. by the year 2000. How will that target be achieved in four years? What method and approach will achieve such levels of skills in four years, enabling us to make a leap of the magnitude that the targets require?

We are supposed to achieve a target of 30 per cent. at NVQ4 by the year 2000. At the moment, Mid Glamorgan achieves only 18 per cent. How is that skills gap to be crossed? How will the leap to those standards be achieved?

My worry is that that lot, the Conservative Government, are like Soviet commissar planners. They announce targets and believe that somehow they will he achieved. If one announced Soviet production, it was reality. Similarly, it appears that if one announces training targets for the year 2000, they will happen irrespective of anything else.

I must tell the Secretary of State and her Ministers that the skills and training element of many training, training for work and other programmes is shrinking. I understand that the only target is to get people into jobs irrespective of how dead-end those jobs are and irrespective of what qualifications those people obtain in the process, what needs are met and what training is associated with that.

How will those targets be reached by the year 2000? They are firm, strong, powerful commitments made by the Government. I do not believe that in many cases the programmes that they offer and deliver in the communities that I represent will achieve that type of target. We have a common aim, a common purpose, a consensus in those terms, but I do not believe that the methods that have been adopted, especially the fundamental changes that have occurred in training for work programmes, are likely to achieve such targets.

My hon. Friend the Member for Brightside spoke about the skills audit. We have one as a result of the Welsh training and education survey. The other thing that the survey shows is that, whereas NVQ3s and similar levels of training are achieved by 50 per cent. of employees in the public sector, only 30 per cent. of employees in the private sector achieve them. The old-fashioned public sector has somehow maintained, and tried to pay for and support, training standards.

For all the Secretary of State's passionate support for enterprise and the private sector, which we all support, according to the survey only 30 per cent. of private sector employees are achieving NVQ3s, as opposed to 50 per cent. in the public sector. A gender gap has opened up and now a gap has opened up in relation to whether one works in the public or the private sector.

I am not being condemnatory. I am not being censorious about private companies and private enterprise. However, the right hon. Lady should know that, in the past 15 to 20 years, in the private sector, people have regarded training as a cost that must he cut, not an investment that must he made. That is the fundamental, simple, basic thing that has occurred.

The Secretary of State may not like to hear talk about stakeholders, and so on, but somehow those attitudes must change, not among employees hut among those who employ. Why is it that figures of the type revealed in the survey demonstrate the low skills in much of the private sector in Welsh economic, industrial and employment life?

I do not know which companies Conservative Members represent, but in the 1980s, with the requirement for labour flexibility, under the pressure to achieve the lower costs that were essential for economic growth, which the Secretary of State mentioned, the first thing that went was training. Training was abandoned furthest and fastest by many employers. I understand the reasons, given the struggles and the background against which they worked. They cut training almost as though it were a cost, and did not regard it as an investment.

Somehow, a combination of Government and companies must restore the fundamental principle that training is an investment, not a cost. Whether one likes it or not, companies in Taiwan, Korea, Japan and Germany—western European companies and Asian companies—believe that training is an investment, not a cost. Until, between Government and companies, we turn the United Kingdom attitude around and decide that training is an investment, not a cost, we shall not achieve the targets and the levels of training and skills that I hope that we have a common cause to achieve. I must tell the Secretary of State that, given the figures, those surveys that have been produced—at least in Welsh terms, in the communities that I represent—demonstrate that we must do something more and different from that which has been offered to us by the Secretary of State's speech.

We have transferred the burden of costs from companies to the state. It is curious that the cost of state financing of training has continually increased. Responsibilities and costs that were borne by companies in the early days have been transferred through unemployment, and through state and training and enterprise council training schemes, and so on, to the state.

It is time to give companies a major incentive and place on them a simple responsible duty to train. That is the first and fundamental change that we want, so that the Government, companies and individuals have one simple belief—that training is an investment in the present and the future, not a cost that may be cut and altered under the impact of change.

Sadly, the most recent Budget demonstrated that not just companies believe that training is a cost that must be cut and a burden; so do the Government.

8.26 pm
Mr. Peter Luff (Worcester)

It is right that I should begin by asking why it is that, if the subject of the debate is so important to the Labour party that it gives up a precious half of one its Supply days to debate it, so few Labour Back Benchers seek to catch your eye, Mr. Deputy Speaker.

Dame Elaine Kellett-Bowman (Lancaster)


Mr. Luff

Two Labour Back-Bench Members.

Perhaps it is because Labour Members know that the economic position in their constituencies is so good now that their heart is not in it. The hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) has witnessed a 19 per cent. reduction in unemployment in his constituency since the most recent general election. The other Opposition Member who I believe is trying to catch your eye, Mr. Deputy Speaker, the hon. Member for Bradford, South (Mr. Sutcliffe), has witnessed a reduction of 21 per cent. in his constituency.

The Labour Front-Bench spokesman who opened the debate, the hon. Member for Sheffield, Brightside (Mr. Blunkett), has witnessed a reduction of 20 per cent. in unemployment in his constituency. I am also happy to tell you, Mr. Deputy Speaker, that the hon. Member for Oldham, West (Mr. Meacher), who will close the debate, has witnessed a reduction of 30 per cent. in his constituency. I am afraid that the hon. Member for Bath (Mr. Foster), who represents the Liberal Democrats, has witnessed a reduction of only 17 per cent., which probably says something about the wisdom of the Liberal Democrat vote. In East Antrim, I believe that the reduction in unemployment since the general election has been 27 per cent. I am glad to say that in Worcester, there has been a larger reduction than in any of those constituencies—about 32 per cent.—since the general election.

Mr. Beggs

The hon. Gentleman should recalculate his figures. One hundred and twenty of my constituents were made unemployed last week.

Mr. Luff

I am very sorry to hear that; none the less, there has been a substantial reduction in unemployment since the general election. Perhaps that is why few Opposition Members are showing their faces in the Chamber tonight.

None of us disputes the fact that training is important. It is important at two levels—for the individual and for the country. We live in a world of rapid change. I know that evidence is a little unclear on how much faster that rate of change is occurring in jobs. I am currently on my sixth job—I hope my last. I shall be only 41 next month. There is no training for the job of a Member of Parliament except rather inadequate on the job training.

I believe that the rate of change in employment is increasing for individuals. Major career changes during one's life are much more likely. If one is to remain economically active during one's life, retraining is increasingly important. If an individual is to contribute to the society of which he or she is a part, retraining is increasingly important. I strongly agreed with my right hon. Friend the Secretary of State when she said that the most important stake that an individual had in society was his or her job.

I believe that there is a moral dimension to this subject—a "one nation" dimension. I very much resent the Labour party's attempts to appropriate that phrase, given what it did to create two, three or who knows how many nations during the winter of discontent.

Training is also important for the competitiveness of the nation as a whole. We all suffer if competitiveness declines. If talent is wasted, output is forgone and if output is forgone, wealth will be reduced in the public and private sectors—whether it is private consumption or public investment in hospitals and schools.

It is no wonder that training has become Labour's mantra: a substitute for any alternative economic policy. The Labour party has adopted a motherhood and apple pie approach which cannot be opposed but which, when examined carefully, is completely vacuous. Who invented training in the modern British economy? I believe that it was the Conservative party. I believe also that Labour's attitude to training is hypocritical on at least three counts: Labour's record while in office, its failure to acknowledge what we have achieved during our period in office, and its plans to increase unemployment.

Let us examine those points in turn. The first hypocrisy is Labour's record. I know that 1979 is a long time ago, but since then expenditure under this Government has increased two and a half times in real terms. There has been a huge increase in expenditure on training. Labour Members lecture us about modest cuts—which, as my right hon. Friend said, are a response to falling unemployment—but Labour's expenditure on training was scandalously low. That was one product of Labour's economic failure and incompetence.

The second hypocrisy is Labour's failure to acknowledge that we have done any good. Labour Members highlight only the problems that they allege exist. I wonder whether shadow Cabinet meetings to discuss the training budget are rather like the marvellous scene from "Monty Python's Life of Brian". Hon. Members will remember that scene when the conspirators are plotting to overthrow Roman rule. One of them asks, "What have the Romans ever done for us?" and another replies, "Well, there are the aqueducts." The first conspirator then says, "Yes, but apart from the aqueducts, what have the Romans ever done for us?" Someone else then says, "Well, there are the roads," and the reply is, "Yes, but apart from the roads and the aqueducts, what have the Romans ever done for us?" Law is then mentioned. along with the roads and the aqueducts—I am sure that hon. Members know how the litany continues.

Perhaps Labour Members sit around the shadow Cabinet table and say, "What have the Conservatives ever done for training?" Some brave soul may say, "Well, they have increased expenditure sharply," and the reply may be, "Yes, they have increased expenditure." Someone else may say, "Well, they have created 1.5 million training places," and the reply may be, "Yes, they have created 1.5 million training places and increased expenditure sharply." Someone may then suggest, "Well, they have set up the training and enterprise councils; they are quite successful." The reply may be, "Yes, they have set up the TECs, they have created 1.5 million training places and they have increased expenditure sharply. Okay, apart from that, what have the Conservatives ever done for training'!" Someone else may then say, "Well, they have introduced national vocational qualifications."

So the Conservatives have introduced NVQs, they have set up the TECs, they have created 1.5 million training places and sharply increased expenditure. Apart from that, we have also increased participation rates in higher and further education and training. So we have increased participation rates and established NVQs, and TECs, produced 1.5 million training places and increased expenditure—Labour Members may well ask what the Conservatives have done for training.

Of course, there is a third element to Labour's hypocrisy. The Government are now able to look more critically at the training budget because we have reduced unemployment sharply. However, the Opposition's policies would increase unemployment. There are more people in work as a proportion of the population of working age than in any other major European Union country. Some 68 per cent. of those of working age are in employment compared with 66 per cent. in Germany, 60 per cent. in France and 53 per cent. in Italy. Only 8.2 per cent. of our population are unemployed, compared with 8.4 per cent. in Germany, 11.4 per cent. in France and 11.3 per cent. in Italy. Youth unemployment in this country is 17.2 per cent. Although I agree that that is too high, it compares favourably with the European average of 20.6 per cent., the French figure of 26.5 per cent. and the Spanish figure of 40.3 per cent.

Mr. Rowlands

As the hon. Gentleman is making comparisons with 1979, will he tell us the unemployment figures in 1979 and compare them with today's figures?

Mr. Luff

The hon. Gentleman knows full well that this Government's record is a damn sight better than that of any other major European Union country. That is the point: we have done extremely well compared with our competitors.

The Opposition plan to increase unemployment. I shall not labour the point, but we all know what the effects of the social chapter and the minimum wage will be. If Labour Members wished to use training to cope with the unemployment that they would create, they would have to spend massive amounts of money simply to maintain the level of training for the unemployed that we have achieved.

The trouble with the Labour party is that it cannot tell good expenditure from bad. Labour Members believe that making £1 of taxpayers' money work harder is always worse than the simpler option of taking another 10p from the taxpayer. They do not understand that we must look critically at every expenditure programme, including training, and ask whether it is delivering value for money to the taxpayer.

If unemployment is falling as a result of the Government's successful economic policies, my right hon. Friend the Secretary of State must take a decision: should she cut expenditure proportionately in order to protect the taxpayer fully, should she maintain expenditure and increase the per capita sum, the total real value of the budget, or should she strike some kind of compromise between the two? I generally favour the latter course, and that seems to be what the Government have done. They have compromised between protecting the taxpayer's interests and increasing the real, effective training budget.

Unemployment has been falling sharply for 27 months. The number of long-term unemployed has decreased by 12 per cent. in the past year and it is 28 per cent. lower than when the community action programme was established. Youth unemployment has decreased by 24 per cent. in three years. That is why I have no hesitation in suggesting that the motion is rank hypocrisy. It highlights only one scheme that has been abolished and the Opposition forget entirely the new initiatives that we are taking to adjust our training programme to changing circumstances.

I refer to the 1-2-1 scheme, the new project work pilots, which my right hon. Friend the Secretary of State highlighted in her speech, and other very important changes which I believe will assist the unemployed, including the jobseeker's allowance. Then there are the reforms to the social security system, family credit, national insurance, housing benefit, the hack-to-work bonus and child care changes. They will help to reduce unemployment still further.

I shall conclude on a local note. The community action programme has proved valuable in my constituency; it has done a good job. However, I am prepared to support its abolition, for the reasons that I set out earlier in my speech and because of the dramatic improvement locally in the situation facing the long-term jobless. Since October 1993, total unemployment has fallen from 13,735 to 10,909 in the area covered by my training and enterprise council. It is encouraging to note that the percentage of long-term unemployed in those figures has fallen also, from 37 per cent. in October 1993 to 29.6 per cent. in October 1995. It is a smaller proportion of a smaller figure. That is why I can accept the abolition of the community action programme.

The debate gives me an opportunity to praise the work of my local training and enterprise council, Hereford and Worcester training and enterprise council. It is one of the best-performing TECs in the country and it is run excellently by Alan Curless, the chief executive. Its performance with regard to youth training has improved significantly—especially among young people with special needs at NVQ1. However, I am pleased to say that there have been similar improvements at levels 3 and 4. Hawtec expects the modern apprenticeship scheme to improve the results even further. I highlight to Labour Members the fact that the cost of delivering that success is decreasing. I add one caveat: I hope that my right hon. Friend the Secretary of State will listen to the concerns of some TECs about the cash flow effect of the method of financing modern apprenticeships. I do not know whether those concerns are well founded, but this is a considerable worry to my local training and enterprise council.

Mr. Allan Rogers (Rhondda)

I am not suggesting that Conservative Back Benchers or those on the Government Front Bench are creating unemployment deliberately; I accept that it is a sin of omission rather than commission which is due simply to their incompetence. However, does the hon. Gentleman accept that all the devices and the programmes and schemes that the Government have introduced to mitigate unemployment have absolutely no effect in constituencies such as mine, where youth unemployment is more like 70 or 80 per cent. than 17 or 18 per cent.?

Mr. Luff

The simple answer to the hon. Gentleman's question is no. I am sorry that I gave way to him. I did not realise that he was not in the Chamber to listen to the earlier part of the debate and I did not know from which direction the voice on the other side was coming.

I am pleased to say that the emphasis on training for work has altered locally to provide more focus on the long-term unemployed, particularly those aged between 18 and 24 years who have been unemployed for more than two years. Contrary to the pessimism expressed by the hon. Member for Merthyr Tydfil and Rhymney, job outcomes locally have improved significantly as a result of training for work. We expect something like 45 per cent. of programme leavers to find work in the Hawtec area in 1995–96. It is perfectly possible for the TEC in my area to manage the reduction in the training for work budget that is already on the table, but I hope that there will be no significant reductions beyond that.

My TEC is an excellent one and it gives me great confidence in the Government's management of training issues. I am delighted that it is merging with the local chamber of commerce. The Three Counties chamber of commerce also has an honourable and fine record in providing training programmes. I understand that an extraordinary general meeting is to be held on 7 February with a view to getting a new board in place by 25 March. It will be a merged chamber. I am sure that merged TECs and chambers will do a great deal for unemployment throughout the country and that they have a great deal to offer.

I urge the House to reject the foolish motion that is before it.

8.39 pm
Mr. Don Foster (Bath)

During the speech of the hon. Member for Sheffield, Brightside (Mr. Blunkett), I was depressed by many of the interventions of Conservative Members, which suggested that many of them do not believe in the importance of qualifications for members of our work force.

In one respect, I was delighted by the speech of the Secretary of State, just as, in one respect, I was delighted by the speech of the hon. Member for Worcester (Mr. Luff). Both of them stated clearly that they believe, along with Opposition Members, that training is crucial. The right hon. Lady drew attention to national targets for education and training. She rightly said that they are ambitious and challenging targets, but pledged herself to doing what she could to help the nation achieve them. There is unanimity among some of us in recognising that improving the skills and qualifications of our people is crucial. As the hon. Member for Worcester said, that is vital for the future competitiveness of the United Kingdom.

Unfortunately, Conservative Members started to giggle when reference was made to various league tables. In some instances the Government like league tables, but when the United Kingdom is not doing well in them, they do not favour them so much. The Secretary of State, like the hon. Member for Brightside and me, recently attended the North of England education conference, which was addressed by Sir Geoffrey Holland. Sir Geoffrey drew attention to league tables that have not been mentioned so far this evening. For example, he observed that 64 per cent. of our work force has no vocational qualifications, whereas in Germany the figure is 26 per cent. In Switzerland, it is only 23 per cent.

Sir Geoffrey referred to other league tables that set out the proportion of the work force that holds intermediate-level qualifications. In France, it is 40 per cent.; in Germany, 63 per cent.; in the Netherlands, 57 per cent.; and in Switzerland, 66 per cent. In the United Kingdom, it is only 25 per cent. That is real cause for concern.

I am sure that hon. Members on both sides of the Chamber recognise that skilled employees lead to increased productivity. That in turn shows through in increased competitiveness. In improving skills, we shall he creating jobs, reducing the level of unemployment, increasing the country's economic prosperity and increasing the well-being of all our citizens.

The evidence of a connection between skills and competitiveness is well established. Sir Geoffrey Holland gave the example of employees engaged in woodworking in Germany. On the shop floor, 90 per cent. of those people have a craft-related qualification. In Britain, only 10 per cent. are so qualified. Output per employee in Germany is about two and a half times higher than that in Britain. There is the connection. The sadness is that we are significantly falling behind our European competitors in ensuring that members of work forces have job-related qualifications.

Another sadness is that it is not a new problem. Indeed, 101 years ago, a report was produced by the Royal Commission on secondary education. I shall quote one of its passages. I apologise for the language, which is not entirely politically correct. The passage reads: The educational opportunities offered to boys and girls who do not proceed to the universities, but leave school at 16, are still far behind the requirements of our time. The disadvantages from which young Englishmen suffer in industry and commerce owing to the superior preparation of their competitors in several countries of Continental Europe are real. Sadly, that is still true.

The United Kingdom is failing to deal effectively with a skills deficit when we compare ourselves with our competitors. At the same time, we know that the number of low-skill manual jobs is sharply to decline. We shall not succeed as a low-wage, low-skill economy. It is sad that, in this European Year of Lifelong Learning, we arc debating the way in which the Government have made cuts in employment and training programmes that are crucial to increase the skills of our work force and to ensure that we meet the targets that the Secretary of State rightly says are vital.

It is ludicrous that about £25 billion a year is being wasted in benefits paid and taxes forgone because of the high level of unemployment. About £9 billion is still attributable to long-term unemployment. Something desperately needs to be done. We must not make cuts in the mechanisms that could reverse the situation.

The hon. Member for Worcester was right to say that, over a number of months, there has been a considerable fall in unemployment levels, including long-term unemployment. Although I understand that the Deputy Prime Minister is able to comment on tomorrow's figures, I had better not do so. The reduction in unemployment levels is clearly welcome, but the number of long-term unemployed as a percentage of all those unemployed is still rising. There are still about 800,000 who have been out of work for more than 12 months. About 1.3 million have been out of work for more than six months. Short-term unemployment is the source of long-term joblessness. It is important that we provide the short-term, as well as the long-term, unemployed with opportunities to gain the skills that will be crucial if we are to create the competitive climate and economy that we need to see.

My party has made it clear that it believes that training and education are critical. Increased investment in training and education is also critical if the United Kingdom is to succeed in an increasingly global market. We need to unlock the potential of all our people, including the nearly 2.25 million who are unemployed.

It is sad that the Government's response to the challenge, as the motion and the debate have highlighted, has been to close the community action programme and to reduce expenditure on employment and training programmes by 4 per cent. We are seeing also a cut of about £200 million in the support offered to the training and enterprise councils.

Those Government decisions show a number of key points, first, that the Government are simply interested in short-term measures for tackling long-term unemployment. As the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) pointed out earlier, there have been constant changes in the programmes—short-term measures brought on stream and then scrapped and another gimmick introduced to give the pretence that the Government are taking real action. Secondly, they show that, after 17 years in office, the Government have found it impossible to design and implement a high-quality, high-investment skills programme for the unemployed that can contribute to the achievement of the national targets for education and training.

Reference has been made to the cuts in the training for work programme—a cut of 16 per cent. of planned expenditure. That shows that the Government expect training and enterprise councils to do more and more with less and less. The hon. Member for Worcester said that the cut in the training for work programme was in response to a reduction in the number of the long-term unemployed; but that is not the only thing that is happening. As the hon. Member for Merthyr Tydfil and Rhymney pointed out, the funding mechanism for training for work is altering to the output-related funding method, with the various problems that that will introduce, and that he so adequately described. There will also be a change in the basis of the planned cost per start under training for work, which is to reduce from £2,549 in 1995–96 to £2,477 in 1996–97. That, of course, is in cash terms. The real terms cut is greater than that implies

We all know that there have been problems with training for work. We recognise that only some 30 per cent. of participants have achieved a national vocational qualification, and that slightly more have gained a work placement subsequently. Improvements need to be made to the programme. One cannot bring about improvements if one is reducing not only the funding for the programme overall but the amount of money that will be available per person on the programme itself. That suggests that we will not, through the programme, he able to add the contribution that is necessary to achieve the targets. It is worth reflecting on what the director of strategy and policy at the TEC National Council said: The News about TfW is not good…It will be particularly difficult to support higher level skills training. The hon. Member for Merthyr Tydfil and Rhymney made the point eloquently. Training for work, underfunded as it will now he, will gradually move away from being a training programme that helps people acquire the skills and qualifications to one that gives people somewhere to go and spend their time, supported by the Government.

Another thing that is worrying is the way in which the Government have cut, prematurely, the community action programme. The hon. Member for Brightsidc referred to that. That is a particular blow to the long-term unemployed and to the voluntary sector, which has been involved in administering many of the schemes. Those schemes have been able to help some of our most disadvantaged citizens. Many of the voluntary organisations that have supplied places, particularly for disadvantaged adults, through the community action programme, may well, I fear, withdraw from involvement in any subsequent training programme activities. That would be a significant loss to our training endeavour. Many of the long-term unemployed, many of whom have benefited from community action, will now he largely excluded from training and enterprise council training programmes.

The Government have argued that the community action programme is no longer needed, hut, if that is true. they must explain how they will support the 40,500 people benefiting under that scheme. We shall no doubt hear from the Minister, as we heard from the Secretary of State earlier, that a number of new projects have been put in place, but together they do not provide the support for that number of people.

Too much of Britain's talent has been wasted and too many opportunities have been lost. The Government's decisions on training and employment programmes mean that that situation will continue. We should be boosting training for work. We must stop the constant stop-go policy of a new gimmick here and a new gimmick there. We need some security that, once introduced, training programmes will be given an opportunity to develop and improve, so that we can get better outputs from those programmes. We must also look at a number of other issues that have not been touched on tonight.

One of the things that the Government have done—I give them credit for this—and also the TECs, which have been promoting it, is to introduce the investors in people programme. That was a welcome initiative. When it was introduced, I was sceptical about whether it would work and whether companies would be interested in it. I was proved wrong. Companies are increasingly aware of the value of training their existing work force. Investors in people has provided the boost for many of them to do that.

As other hon. Members have said, we need to encourage more people to train. One of the ways in which we could do that would be to consider introducing a 2 per cent. remissible training tax. If a company did not spend up to 2 per cent. of its payroll, it would be taxed on the difference. If it were spending up to 2 per cent. of its payroll on training, it would avoid the tax. That would provide the stick to go alongside the carrot that is provided by investors in people, and ensure that companies that have not yet recognised the benefit of providing increased training for their existing employees might well do so. We need to find other imaginative ways of providing support to the long-term as well as the short-term unemployed. We would not, however, cut back on the programmes that already exist.

It is clear that there is a degree of unanimity in the Chamber about the importance of training and about increasing the skill levels of our work force and providing support to the unemployed. By making cuts in the training programme, the Government will undermine the possibility of increasing the support that we offer, and will undermine the ability of the unemployed to gain the high-skill jobs that they need for their own benefit and which the country needs them to have for the economic prosperity of the nation.

8.57 pm
Mrs. Elizabeth Peacock (Batley and Spen)

I welcome the opportunity to say a few words in this important debate instigated by the Opposition, but I am a little surprised that only three of their Back-Bench Members are present for it.

Mr. Meacher

Only three Conservative Members are present.

Mrs. Peacock

It is the Opposition's debate.

I have always supported training and education from whomever and wherever it came. In the late 1970s and early 1980s, there were the job opportunities and community programmes. They were mostly then, as perhaps now, organised by the voluntary sector, usually councils for voluntary service. What a difference that made to setting young people, in particular, on the path to a job. Many more opportunities are now available to help people back into work.

I was intrigued by the Leader of the Opposition's reference to stakeholders. I wonder whether he travelled through Romania on his way back from Singapore, visiting Dracula's castle at Bran. I believe that he is the stakeholder whom most people know best. I am not sure that it has much relevance to our modern-day society.

Special help is available for the unemployed, in particular for those unemployed for longer than six months. There are job clubs, training for work, job interview guarantee schemes and work trials. They are all designed to help unemployed people with different needs. It is well recognised that there cannot be a universal programme for everyone seeking work.

Work trials enable unemployed people to try out a job for up to three weeks, giving them the opportunity to show employers what they can do and giving employers the opportunity to see whether people's skills are appropriate for the job that they are offering. That will ensure that many more round pegs go into round holes, rather than the mismatching that we have had in the past.

Restart courses help those who have been unemployed for two years. The jobfinder's grant covers additional expenses. That is most important because many unemployed people need such help, particularly after a long period of unemployment. There is also help for the short-term unemployed. We have already heard how important it is to help the short-term unemployed, to prevent them becoming the long-term unemployed. Job search seminars give practical advice to people unemployed for more than 13 weeks. The travel-to-interview scheme pays the cost of travel to interviews away from an applicant's immediate home area.

We have already heard of the many investors in people schemes. That must he good. Many of my manufacturers realise the importance of their work force and the training that they give them and they wish to retain that trained skilled work force. They put huge amounts of time, effort and money into those schemes.

We also have training and enterprise councils, although I am sometimes a little concerned about them. They have rather palatial offices with many jobs and I am not entirely convinced that they arc creating as many jobs outside as I would wish them to do. My hon. Friend the Minister might like to say a word or two on that. Any unemployment is unacceptable and I am delighted to see the reductions in the number of people unemployed since 1992. We now have 733,000 fewer people unemployed since that date.

When I became a Member of Parliament in 1983, there were 1,900 long-term unemployed in my constituency. That figure has now been halved. It is still too many, but it is always moving as some people become unemployed and others return to work, and it is moving in the right direction. Unemployment in my constituency now stands at 6.7 per cent., much less than in 1983.

Unemployment has fallen in the past 27 consecutive months, and we must all welcome that. It is also interesting to note that youth unemployment in July 1995 was 24 per cent. lower than that in January 1993. European Commission figures show that the United Kingdom has more people in employment and fewer people out of work than any other major European country. It is right that that should be well documented.

The community action programme was established in 1993 when the number of long-term unemployed was 28 per cent. higher than it is now. I understood that it was introduced for one year only and then extended. As I have already said, the public sector provides a considerable number and range of opportunities to help young and unemployed people.

Our own industries also provide training for their work forces. The Confederation of British Wool Textiles has a first-class successful training scheme, not just for young people but for people of all ages within its work force. That has produced many more NVQ and other qualifications in recent years. That is most welcome.

As the House will he aware, from April 1996, incentives for employers to take on someone who has been out of work for two years or more will be extended. Employers will be able to claim a full rebate of such people's national insurance contributions for up to 12 months. That will help many people back into work. It is suggested that the figure could be as much as 120,000—I would certainly welcome that.

Another measure that I have long wanted to see is that, from April 1996, full housing benefit will be extended for four weeks to people going back to work. All hon. Members have had cases where someone has been out of work, has had help with housing benefit, has got a job on Monday the first and has not been paid until Monday the 31st. How do such people manage during that period? We have a responsibility to help them take that job, but not he penalised by having one month's arrears of rent or mortgage at the end of that period. I welcome that measure whole-heartedly.

It is interesting that we are told that there are not very many jobs, yet the Yorkshire Evening Post, Yorkshire's daily newspaper, regularly has a billboard saying, "500 jobs today" or "600 jobs advertised today", so some jobs are available. I know someone who recently came back from Australia, having been there for 20 years, with no income—practically nothing. Within a week, however, he had found himself a job, which was interesting. He did not know the system, but he went out, spent a week looking, and got a job.

Since coming to the House in 1983, I have taken a great interest in employment, investment, education and training, because they are closely linked. They are essential to UK plc's future and especially to our manufacturing industry, of which we have much in West Yorkshire.

As I have said, during the 1980s, manufacturing investment enabled us to achieve huge reductions in unemployment in my constituency of Batley and Spen. Between November 1986 and November 1987, unemployment dropped by 19 per cent. Between 1987 and 1988, it dropped by 27 per cent. and between 1988 and 1989, it dropped by 22 per cent. In the early 1990s, unemployment dropped by 13 and 5 per cent.

For the people involved, however, unemployment is individual. It is a traumatic time in their lives. They are not just a statistic. For them and their families, it means much heartache and grief about how they are going to manage, and the whole family suffers. Sometimes we become carried away with statistics and forget that we are speaking about individuals and their families, and we forget what a traumatic time it is for them.

In Yorkshire, there has been massive investment in industries. In my constituency, since 1984, well over £200 million has been invested in jobs, new processes, new technology, new factories—which are there for everyone to see—and of course training because what manufacturing company wants to invest a huge amount of money in a new factory, new technology and new equipment and then not bother with the work force? Many manufacturers say to me that the most important part of their business is their work force, because, without it, many of the machines, however clever, would not operate—of course, they realise that. If we had not invested in training, we would not be able to manufacture and export our high-quality goods around the world.

The hon. Member for Sheffield, Brightside (Mr. Blunkett) insulted all people who have invested money in businesses. Suggesting that the only investment in the United Kingdom is in burger bars is outrageous. He should think carefully before making such a sweeping statement, especially as, if he went a little further around Yorkshire with some of his colleagues, he would see evidence of continuing massive investment.

We need to continue with training and education, but they must start in our schools, and continue with programmes and in our industries. We do not need to lecture industries about that. They know that and are already doing that work. The money that they have put into the investors in people schemes is a prime example. However, we also need to have retraining for people who become unemployed. Although everyone would mourn the loss of any scheme that comes for a short time and goes, the whole jigsaw of training, work and people is continually moving and, unless our response by way of programmes to that movement is continual, we shall become static and not gain the benefit.

In his winding-up speech, perhaps my hon. Friend the Minister will say a word or two about how he sees the future of the TECs and encourage them to consider their budgets a little and to push a little more of that money into people's training.

9.9 pm

Mr. Gerry Sutcliffe (Bradford, South)

We all agree that this is an important debate; but we are discussing real, damaging cuts—not imaginary cuts—and I am staggered by the complacency of Conservative Members. Hearing the Prime Minister and the Chancellor of the Exchequer wax lyrical about the enterprise culture, describing Britain as the enterprise capital of Europe, we can understand why the Tories are so far behind in the opinion polls: the simple reason is that they do not live in the real world inhabited by my constituents and by the majority of British people and their families.

The millions who are in work fear redundancy because companies have not invested in new technology, research and design and re-skilling programmes. Many parents would have been angered by the debate; they do not know what future their children have and whether they will make their way in the world. If there are no jobs, those children will have no prospects. As for the people who are unfortunate enough to he unemployed, they are confined to seeking temporary or part-time work involving low pay and long hours because of their lack of skills. That is a disgrace.

I do not believe there is such a thing as a one-nation Tory. Tories do not believe in society; they believe only in the development of the individual, and in a system based on greed, in which the big pussies can have fat pay cheques while the unemployed suffer cuts in benefit. The Tories have ceased to develop training programmes, and are attempting to create the illusion that everything is all right.

What is the Government's real motive for cutting training budgets? Could it be part of their economic strategy to keep a permanent pool of unemployed people to act as a stimulus to a low-wage economy? That is the Government's vision of Britain: they want to retain a divided society, so that they can claim some imagined success. Belatedly, some remorse has been shown by, in particular, the Deputy Prime Minister, who has called for a job skills audit. He has finally realised that Britain is slipping in the world prosperity league.

An alternative title for today's debate might be "The Waste of a Nation". The £20 billion that has been spent to keep people out of work could have been used to create real, permanent jobs. Every successful economy knows that, if success is to be maintained, there must be a structured and dynamic training and employment programme rather than stop-start schemes that merely massage the unemployment figures. There have been 32 changes in those figures. Even I could make unemployment apparently fall if I changed the calculation involved.

Mr. Edward O'Hara (Knowsley, South)

Does my hon. Friend find in his constituency, as I do in mine, that the very intonation with which young people utter the word "scheme" indicates the contempt that they feel for those devices for massaging the unemployment statistics'?

Mr. Sutcliffe

Those of us who come from manufacturing constituencies knew the routes to employment: we knew that there was a prospect of work. Nowadays, young people see not the prospect of work but meaningless schemes that do not develop their skills.

More than 3 million people in Britain are unemployed. and 750,000 have been out of work for 12 months or more. My city must create 700 jobs just to stand still—a city with a proud manufacturing base that was decimated by the loss of 22,000 jobs in four years. Why have the Government something against manufacturing industry? As a consequence, they have destroyed many of our communities. The Secretary of State recognised that the north has been hit particularly badly.

In 1979, manufacturing represented 30 per cent. of gross domestic product; it now represents less than 20 per cent. We need only look at any industrial sector to see that the machinery for manufacturing is imported from our competitors in Europe or elsewhere in the world.

To cut the training budget as the Government have is to destroy the country's future. According to the survey, "Skill Needs in Britain", conducted at the Department's request, employers were concerned about the skills gap, and 21 per cent. of employers and companies with more than 25 employees thought that there was a significant gap between the skills possessed by their current work forces and those that they needed to meet their business objectives. Another study, conducted by the Business and Technology Education Council in August 1995, showed that 50 per cent. of firms employing more than 100 people thought that their profitability would be affected by skill shortages among very young workers. Out of the 21 countries in the OECD, the United Kingdom lags behind all but Turkey in the proportion of 17 and 18-year-olds in education. Currently, 180,000 17 and 18-year-olds are not receiving education, work or training. That is a national disgrace.

When the training and enterprise councils were set up, they took the money that would normally have gone to further education colleges and other provision through local authorities. The objective was to bring together public and private sector players, with the emphasis being placed on the high fliers in private sector chairing the TEC boards to provide business acumen to remove the shortfalls in the skills gap.

Bradford TEC has been very successful. It has a committed board that is determined to meet Bradford's needs, but in recent times the board has become frustrated as its resources have been reduced year by year. Its budget has been reduced by £1.8 million this year—a cut of 9.5 per cent. Incidentally, the training for work budget has been cut by 24 per cent., in a city with a rising population and above-average youth unemployment, especially among ethnic minority communities.

The Government have claimed radical change in the education and training sectors in the past 16 years, but the reality is different. They have created confusion on standards and they have depressed and sapped the morale of teachers, lecturers and training providers. Worst of all, they have thrown away all the golden opportunities given to them—for example, by North sea oil—to equip our country with a highly motivated, highly skilled work force capable of creating wealth, which would lead to investment and growth to revitalise Britain's economy.

The abolition of the community action programme will attack again the most vulnerable in our society. One in five households with a member of working age has nobody in work, compared with one in 12 in 1979. Those people have the right to work without the opportunity to work and that means that they have no stake in society. The community action programme had its critics, but it was set up by the Chancellor in 1993 to offer work to 40,000 unemployed people, and it has been seen to he working. The Government have shown that they lack the will and the ambition to support and build up education and skills for life.

I suppose that at the end of this month we shall see another relaunch for the Prime Minister. Like the rest of the relaunches, it will not work because he is out of touch and the Government are out of touch. A society in which as many as one third of the people are marginalised and cut off from the opportunity to secure worthwhile employment is a society that squanders the potential of people and the resources of its economy.

What have the Government got against trade unions'? Why do they try to create conflict where it does not exist'? Forty-seven of the top 50 companies in this country have union agreements and organised trade unions. We see the benefits of work forces working with their managements to re-skill, to introduce new technologies and to develop the ability to work together; yet the Government are caught up in political dogma. The cuts in the training budgets are damaging and will affect people. The Government do not care about unemployed people: they care only about maintaining their aspiration to look after the top 10 per cent. of the country. I believe that we shall see the return of a Labour Government who will make a commitment to training for people and ensuring that we have a structured training environment.

9.17 pm
Mr. David Evennett (Erith and Crayford)

I am delighted to participate in this important debate, but I do not want to follow the depressing example of the hon. Member for Bradford, South (Mr. Sutcliffe). I congratulate my right hon. Friend the Secretary of State on her excellent speech and on putting on the record the facts and figures on jobs, vacancies and the number of people participating in post- 16 training and education. It is a pity only that more hon. Members, especially from the Opposition, were not in the Chamber to hear those figures.

In today's fast-changing world, the speed of technological change has meant that training and education are even more important. Skills have to be updated in nearly all areas. For individuals to be able to meet today's challenges, there must be a change in the approach to education and training. The old idea of a job for life is, regrettably, no more. In addition, once qualified, people may have to be retrained. However, I welcome the many opportunities that our society offers today.

There are more opportunities for our people in training and education than ever before. I am appalled by Opposition Members and their depression. The hon. Member for Sheffield, Brightside (Mr. Blunkett) was all doom and gloom. Opposition Members never acknowledge the vast opportunities for education, training and retraining that are available now to the vast majority of people. The tremendous opportunities of today were just never available in the past.

As the world of work changes, so too must education and training change. Of course the young and the unemployed must he our top priority, but so must those who want to upgrade their skills and advance their opportunities. It is not only the Government and the taxpayer who should provide training, however. The Government have an important role, but so do industry, business and commerce—as we heard from my hon. Friend the Member for Batley and Spen (Mrs. Peacock). I should like the private sector to do even more training and retraining.

The Government are to be congratulated on endeavouring to offer more opportunities and help to the young and the unemployed. The investment has been considerable: 1.5 million places in employment and training programmes in the public sector for the coming year. With the improving economic climate and falling unemployment, the future looks much brighter for people who are seeking work.

In my constituency and across the whole borough of Bexley local businesses feel increasingly optimistic about the economy. We are fortunate in having an excellent further education college. Bexley college, as it is now called, is primarily located in Erith; but under the successful leadership of Dr. Jim Healey and his team it has become a centre of excellence for education and training. The college's initiatives have helped to train and retrain many local people and given them the skills to assist them in their search for work.

It is vital that our education system equips our young people with the necessary foundations on which to build their careers and their lives. The education reforms of the past decade have tried to do just that. Apart from the introduction of the national curriculum, the publication of school results, testing and the increased amount of inspection of schools, much has also been achieved in vocational and technical education. There is no mention of these successes in the Opposition motion. Further training for specific jobs would be useless if the basic education had not been provided in the first place. At long last vocational qualifications of a high quality are being provided, and are increasingly accepted by employers, pupils and parents. GNVQs have at last won acceptance, which is very good news.

The greater independence of further education colleges such as Bexley college has allowed them to develop and to provide a wider variety of courses, thereby ensuring that the young, the not so young, the unemployed, and those who want to return to work after bringing up children can enrol in training courses, improve their qualifications and update their skills. That is vital to society and individuals alike. The work done by such colleges is to be commended. It is certainly valued by many people throughout the country.

I confess myself disappointed that the private sector does not do more training. Elsewhere, in America and Germany, private industry, commerce and business are much more geared to providing training and retraining for their work forces, and are prepared to sponsor more young people through college and university. I should like to see much more of the same here. Private organisations, as well as the Government. should do more training—a fact not mentioned by the Opposition because they believe the Government should do everything: the taxpayer should provide everything. I believe that there is a balance to be struck between the Government and the private sector, because it is essential for this country that we have a skilled, qualified work force.

There is much more to be done in the field of training, but we should also commend the good work that has already been achieved. I totally reject the Opposition's pretence that cuts in certain programmes will be the end of civilisation.

Mr. O'Hara

Will the hon. Gentleman give way'?

Mr. Evennett

I am afraid not, because I must leave time for the Front-Bench spokesmen.

Education and training are and must be at the forefront of an opportunity society. Economic success, low inflation, growth and an entrepreneurial approach are the keys to lasting jobs. We are after lasting, long-term jobs and not short-term, temporary ones. It can be terribly depressing for people who have been on a training scheme to get short-term work, only to find themselves back on the unemployed list. It is unfair; in fact, it is cruel. Our training should be aimed at long-term, worthwhile and vital jobs.

To listen to Opposition Members, one would think that the Government have abandoned all their training facilities, and advice and assistance to young people and those seeking work—whether young or not so young. That is ridiculous. My right hon. Friend the Secretary of State described in great detail the training provisions and facilities that are being developed and are available for those who are unemployed or leaving school and college.

As well as training, the importance of assistance and practical help in finding work must be paramount. Jobseekers need help and advice, which they can often find at jobcentres. We have very good ones in Bexley where people regularly go and are given tremendous help. Job clubs, too, are vital in encouraging and helping people, especially with curriculum vitae, in gaining confidence and completing applications. As well as training in particular skills, people need help and advice. I welcome the opportunities available to help and advise people who are looking for work. Many of my hon. Friends have already cited the long list of available schemes for training and retraining and I shall not repeat them in view of the pressure on time.

The Government have achieved a great deal in education and training. An improving economy, education reforms and relevant training are the foundations for getting unemployed people back into work—whether young or not so young. In looking to the private sector to do more, we should encourage private sector companies to ensure that their workers are trained and retrained in the necessary skills.

As I am sure my hon. Friend the Under-Secretary of State will say, the most important part of the debate has been the fact that it has made it abundantly clear that the Opposition are totally bankrupt of any ideas about training or retraining. Of course they want to spend more taxpayers' money. They want to spend more on just about everything in their portfolios, although they do not like to admit it in public.

We want a good training and retraining programme—which I believe that we have—that will allow people to amend and update their skills and get long-term, worthwhile jobs.

9.26 pm
Mr. Michael Meacher (Oldham, West)

I could scarcely believe my ears when the Secretary of State opted to promote her case in the debate by taking a stand on the unemployment record of the past 15 years. One would never guess if one listened to the right hon. Lady that under Labour, unemployment scarcely ever rose above 1 million, whereas under the Tories unemployment has scarcely ever been below 2 million in the past 15 years.

One would never guess if one listened to the Secretary of State that there have been 25 or more changes in the unemployment figures, which according to the independent Library estimates, have added about 900,000 to the employment count. The real rate of unemployment is not 8 per cent. but probably nearer 11 per cent., and certainly one of the highest in Europe.

We were treated to a selective list of the worst black spots of unemployment abroad—while of course ignoring our own—amnesia, a re-writing of recent economic history in Britain and a cavalier dismissal of the central fact that, despite tiny falls in unemployment in recent months, unemployment remains. [Interruption.] This is the key point. Unemployment remains at an historical high, which is totally unacceptable.

The Secretary of State also said that the Government have given people rights and opportunities. I would say that the Government have done more to take away rights, stability and security than any Government since the 1930s. There has been a doubling in the number of those on low wages, a tripling in homelessness, 1 million people have been trapped in negative equity, and millions have been exposed to job insecurity caused by the Government's deregulation of the labour markets. Perhaps worst of all, 14 million people—a quarter of our entire population—are living on income support, which for an adult is just £46 a week. As my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) rightly said, social and economic policies have generated welfare dependency. It is incredible that the Secretary of State should say that the biggest stake that people have in society is a job, when the Government's record on unemployment is worse than that of any other Government since the 1930s.

At the centre of the debate has been the serious and damaging overall cut in departmental expenditure and its impact particularly on training for the adult unemployed. Overall, the departmental budget will be cut by £150 million in the next financial year. If one compares next year's budget with what was previously planned, the cut is £430 million. At a time when education, training and employment are widely seen as the key to national recovery, those figures speak volumes about the Government's priorities.

The main burden of the cuts will fall on employment and training, which will lose up to £120 million as a result of reductions in the allocated budget, as the Government have admitted, of 4 per cent. The adult unemployed will bear the brunt of that cut. The original figure planned for expenditure on training for work in 1994–95 was £724 million. The planned figure for training for work next year—1996–97—was stated by the Chancellor of the Exchequer in his Budget speech two months ago to be down to £488 million. Compared with the actual expenditure just two years ago, the planned expenditure on training for work in the coming year—and the outturn may well he lower—is being cut by no less than 30 per cent.

That provides a rather different impression from the bland and complacent excuse trotted out by the Secretary of State, that a 4 per cent. cut in employment and training programmes must he seen in the context of what Ministers rather coyly describe as a welcome 12 per cent. fall in long-term unemployment in the past year. Of course, as I made clear earlier, Ministers have a great deal to he coy about. The Secretary of State did not answer the point that I made earlier and she is not paying attention now, although I am not surprised because it is an extremely embarrassing point. The only reason for any fall in unemployment in the past three years is that the Government were forced, kicking and screaming, to abandon the exchange rate mechanism in September 1992. To quote the fall in long-term unemployment as justifying abandoning the community action programme or cutting other training programmes is irrelevant, because the fall in unemployment was wholly due to the lower interest rates and exchange rates that that permitted. It had nothing to do with the Government's employment and training programme.

Another reason why the Government's rationale for cuts in training and employment budgets is transparent and shabby is that it suggests that unemployment and skills shortages are problems that are well on the way to being satisfactorily resolved, so expenditure can be safely reduced. The truth is rather more sobering. The fall in unemployment is flattening out at the still extremely high level of 2.25 million—that is on the Government's account—which is 500,000 above the low point of the previous cycle, and there are still about 800,000 people who have been unemployed for more than a year. With the exception of the short-lived blip in 1989, unemployment in this country has not been below 2 million in the past 15 years. That is an appalling record and certainly does not warrant any let-up in programmes designed to reduce unemployment.

The idea that our training programmes are now so satisfactory that we can afford to reduce them is preposterous. The United Kingdom currently invests about 0.6 per cent. of GDP on labour market measures. Germany and France invest twice as much and many other European states invest even more. The UK would need to raise spending by £4 billion to £5 billion to come into line with the European average.

In many ways, the picture is even more stark. More than one in two workers in Germany hold vocational qualifications at craft level, whereas in Britain only one in five do. Two thirds of foremen in German manufacturing industry hold higher intermediary qualifications, whereas in the UK the figure is just 3 per cent.—one twentieth of the level in Germany. [Interruption.] Had the Minister of State, Department for Education and Employment, the hon. Member for Mid-Worcestershire (Mr. Forth). been present at the start of my speech, he would have heard me say that the House of Commons Library estimates that the real unemployment rate is well above the Government's 8 per cent. figure and probably nearer 11 per cent.

I could continue with such comparisons. Compared with that of our international competitors, our training record is still badly deficient and trailing. There is no justification for cutting our training budget against the background of such a large and prolonged shortfall in skills training. Evidence shows that the skills shortage is growing. In 1992, 5 per cent. of companies reported some hard-to-fill vacancies. In 1993, the figure was 6 per cent. and in 1994, it was 11 per cent. In 1994, the "Skill Needs in Britain" survey showed that one person in five had no in-work training whatever. Moreover, an Industrial Society survey showed that, in the same year, employers spent only £380 a year on training per employee compared with £490 only 18 months before. Far from breaking through the skills training gap, the Government are compounding the slide in this country's skills training in the workplace by cutting the employment and training programme.

It is not just about money; it is also about the fundamental question of what existing training programmes really achieve. Training for work has largely become a job placement programme for people who are already job prepared, while few opportunities exist for those who are not. My hon. Friend the Member for Merthyr Tydfil and Rhymney made that point eloquently in his speech. The Government's current focus on job outputs within a short time scale inevitably discourages the recruitment of anyone who is not ready to go straight into a job. The result is that the extent of value added and of skills produced by that system is often negligible. As the Government say, improved job outcomes are being recorded, but less training activity is being delivered.

Provision for special training needs is in a bad way. Contracting for the special needs of adults is now undertaken largely to meet a numbers quota. Even specialist providers say that they can no longer afford to meet the requirements of people with special training needs. In addition, the voluntary sector providers who make available the majority of places for special training needs are being squeezed out of the training market, with substantial cuts in both income and places on adult and youth training programmes. As a result, programmes steer clear of the long-term unemployed and the special training needs population, who should be the most important customers of all. That, probably even more than money, is the central flaw in the Government's current training strategy.

The other key issue is that of money.

The Minister of State, Department for Education and Employment (Mr. Eric Forth)


Mr. Meacher

I am glad that the Minister says, "Ah." Perhaps he is paying attention for once.

The money to deliver the output is simply not available. As a result, basic and higher skills training has been severely reduced, to the extent that in many areas it does not exist, even where there is labour market demand and skill shortages. A national survey of TECs carried out recently in my constituency of Oldham found that the number of places last year decreased by 21 per cent. compared with the previous year. I could go through the whole list—33 per cent. in Manchester and up to 34 per cent. in Barnsley and Doncaster. That has happened not just over the past year; funding has continuously declined for the past five years.

In that time, the budget for adult training has been halved, while the level of unemployment has marginally increased. In 1991, the budget for employment training, which was the forerunner of training for work, was just over £1 billion. Unemployment in that year was just under 2.3 million; last year it was, on average, slightly over 2.3 million. Yet the average payment per trainee has fallen, year on year. from £50 in 1992–93 to £28 last year.

I am even told that one provider who has had a contract since 1991 for the same provision shows that the contract price per trainee per week has been reduced from £84 to £30. It is impossible to provide a quality skills training programme with cuts on that scale.

The debate has exposed fundamental weaknesses and failings in Britain's current training system that Government policy, especially the continued funding cuts, has clearly exacerbated. Several radical changes are urgently needed. First, output-related funding dominates all other measures of performance. It is distorting the system away from providing longer-term skills and quality in favour of short-term jobs. Moreover, a successful outcome is assumed even if the job lasts only a week and irrespective of what sort of job is involved, how much is to be paid, and whether the person is to work full time, part time or whatever. The system needs to he dropped or at least radically changed.

It is also unacceptable that almost two thirds of youth trainees leave schemes before they end; half find no job at all; and another half have no qualifications to show for it when they leave training. We need a new criterion of performance that takes much more account of the qualifications gained.

Mr. Rowlands

Will my hon. Friend give way?

Mr. Meacher

I am reluctant to give way because I have so little time. I do not intend to take more than a few minutes. There is an urgent need for stable funding—a point about which my hon. Friend waxed most eloquent, when he said that there is constant chopping and changing and great uncertainty in TEC budgets for that reason.

The Government's continually changing funding criteria for TECs make it difficult for them to plan ahead. Knowing the Government as we do, nobody was surprised when it emerged a few weeks ago that their latest wheeze for compensating for fresh cuts in the TECs budget was to start to fund special training needs courses from the national lottery.

I shall quote from a letter to the chief executive of the National Lottery Charities Board from the director of policy at the TEC National Council. It states: The Earl of Stockton has provided my office with a copy of the correspondence between David Sieff"— the Marks and Spencer chief who chairs the National Lottery Charities Board— and himself concerning the possibilities of TECs working in partnership with local eligible organisations to develop programmes for re-skilling the disadvantaged that might be considered for grants from the National Lottery Charities Board. One would have thought that even this Government would regard that as more of an eccentricity, or even a joke, than a serious policy.

Special training needs must be better safeguarded. Several options should be urgently considered, such as a separate programme for the most needy, ring-fencing of money for their training and greater concentration on basic skills training. One or other of those should be adopted.


Mr. Evennett

Hear, hear.

Mr. Meacher

I am taking less time than did some Conservative Members.

Lastly, we strongly deplore the premature closure of the community action programme, which offers 40,000 to 50,000 people a year work experience, individually tailored help with finding a job, work projects of benefit to the community that would not otherwise he done and priority access for people with disabilities. Indeed, as my hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett) said at the start of the debate, only a year ago the then Secretary of State for Employment announced that it would be extended for a further three years at a cost of £70 million a year. It is difficult to avoid the conclusion that the Government are now much more motivated to make savings for tax cuts than to preserve employment programmes, when even the then Secretary of State, the right hon. Member for Enfield, Southgate (Mr. Portillo) of all people, regarded the programme as valuable enough to extend for another three years.

Improvement in the quality and coverage of training should be at centre stage for our national economic recovery. The Government have manifestly failed the nation in both the scale and quality of training provision, which still falls far short of that of our international competitors. If the Government's record and the wheedling excuses made for it by the Secretary of State for Education and Employment are the best that they can do, the sooner the election throws them out, the better.

9.45 pm
The Parliamentary Under-Secretary of State for Education and Employment (Mr. James Paice)

Today's debate, albeit brief, has provided the House with a wonderful opportunity to highlight the contrast between the Government's successful and real policies to help the unemployed and promote training with the dearth of policy suggestions from the Labour party.

I shall start by examining the central issue of cuts in training in the Labour motion. As my right hon. Friend the Secretary of State for Education and Employment said, in real terms there will he more money in the budgets for TEC programmes next year than there is this year. [HON. MEMBERS: "They have been cut."] There has been no cut in the overall amount of money for TEC programmes.

Mr. Blunkett

That is not true.

Mr. Paice

There has been no cut in real terms; rather, there has been a 5 per cent. increase in the overall amount of money for TEC programmes.

We are proposing to shift money between programmes because of the shifting priorities in the needs of the unemployed, because of the fall in unemployment and the increasing value and importance that are attached to modern apprenticeships, to which we are adding another £115 million. The Government have always recognised that we must catch up with the skill levels of our competitors, which was why we have concentrated on reforming the education and training system to deliver better results. We have merged the Department for Education and the Department of Employment, because we recognise that they go hand in hand in meeting the competitive challenge from the rest of the world.

We have achieved great things. More than 90 per cent. of 16-year-olds are now in education and training. Almost one in three of our young people go on to higher education, compared to one in eight in 1979, and twice as many of them get A-levels as in 1979.

Of all the accusations and challenges that have been thrown at the Government by the Opposition this evening, the accusation that an approach has been made to use the lottery to fund training for special needs must he resolved immediately. The TEC National Council has already made it absolutely clear, publicly and for all to hear, that that accusation is totally without foundation. That fallacious story has arisen because the National Lottery Charities Board approached one TEC for the names of organisations that are involved in helping the disadvantaged.

I must confess that I was somewhat surprised when I heard that the hon. Member for Oldham, West (Mr. Meacher) would sum up for the Opposition. He has never made any secret of his disagreement with what, we are led to believe, is Labour party policy. In his remarks this evening, he referred critically to the deregulation of the labour market. One can assume from that that he opposes it, but I have heard absolutely no pledge from the Labour party in recent months that it intends to reverse the deregulation that we have carried out. The hon. Member for Oldharn, West has said: Mrs. Thatcher's abiding achievement has been to turn the Opposition into a variation of the Government's theme. He went on to say: People want real change, not a paler shade of the same. Only last month, the hon. Member for Oldham, West appeared on "Kilroy" and was challenged about Labour's proposal to give employers £60 a week to take on the long-term unemployed, while the long-term unemployed would receive only £45 in benefit. According to the Oldham Evening Chronicle, which I am led to believe is a learned journal, the hon. Gentleman's reply was: Let me make it clear to you. I am embarrassed by that point. Why is he on the Front Bench?

The intervention that the hon. Gentleman made in the speech of my right hon. Friend the Secretary of State about our exit from the exchange rate mechanism begs another question: why is it that Italy, which came out of the ERM at the same time, has seen unemployment continue to rise while ours has been falling dramatically? Could it have more to do with the state of the labour market than the ERM?

The hon. Gentleman also referred to unemployment figures and suggested that the real ones were much higher than those which we announce. If that is so, why do the labour force survey figures, which we also announce regularly and which have gone along closely with the claimant count figures, meet the requirements of the International Labour Organisation, to which the Labour party and the Trades Union Congress have signed up?

A number of hon. Members have rightly emphasised the need for this country to improve and increase our training and to meet the national training targets. The Government have never made any secret of their intention to achieve that. I wish to deal with a misunderstanding—a fallacy—promoted by the hon. Members for Merthyr Tydfil and Rhymney (Mr. Rowlands) and for Bath (Mr. Foster) that programmes for the unemployed can, on their own, address the need to meet our training targets.

We should remember that only 3 per cent. of the work force are long-term unemployed—the figure is still too high, but it is 3 per cent. Some 92 per cent. of the work force are in work. If we are to meet the targets for the year 2000, we shall do so by providing encouragement, exhortation and help to all the work force.

Business spends about £20 billion a year on training and education. The Confederation of British Industry estimates that the figure is £28 billion, but I shall settle for our figure of £20 billion. We must develop a culture that is based on better schooling and achievement in compulsory education through our education reforms. That process will lead to the understanding that training is, as the hon. Member for Merthyr Tydfil and Rhymney said, an investment, not a cost.

I must take issue with the hon. Member for Merthyr Tydfil and Rhymney for suggesting that the private sector had been cutting training. That is a historical fact, but it has not been the experience of the recent recession, when training expenditure by the private sector held up far higher than in any previous recession. That demonstrates that the message is getting through to the employers that they must invest.

My hon. Friend the Member for Worcester (Mr. Luff) made what must be considered as one of the best speeches in the House for a long time when he emphasised the fall in unemployment and described in graphic detail the tremendous successes and developments of the Government's training policy.

My hon. Friend the Member for Batley and Spen (Mrs. Peacock) emphasised the varied needs of the unemployed. She also expressed concerns over TECs, particularly the cost of their administration and bureaucracy. All TECs must publish annual reports to highlight those figures and they must all hold annual public meetings where their staff are open to cross-examination by the people in the community. I am anxious that as many resources as possible are spent on training, not wasted on administration. TECs have a vital role to play in developing our training infrastructure and needs—as they have for the past few years.

My hon. Friend the Member for Erith and Crayford (Mr. Evennett) rightly referred to the importance of sound, basic education and highlighted the independence of our further education colleges. One of the most exciting aspects of my job is when I travel around the country and college after college tells me of the wonderful success that it has made of independence.

Dame Elaine Kellett-Bowman

Hear, hear.

Mr. Paice

Understandably, my hon. Friend says, "Hear, hear." I was privileged to visit the college in her constituency just before Christmas, and there people were very proud of the independence that the Government had given them.

The hon. Member for Sheffield, Brightside (Mr. Blunkett) said that he wanted a serious debate on training. I do not know what happened to his intentions, because it did not materialise. He suggested that the country needs a high-skill economy, and we would entirely agree. It is absurd to suggest that we can compete, with a low-wage economy, with the countries of the far east. No one has pretended that we can do so.

What matters are unit labour costs. Those include non-wage costs. Let me remind the hon. Gentleman that, in the United Kingdom, non-wage labour costs in manufacturing are about 15 per cent. of unit labour costs.

In France they are 29 per cent., in Germany they are 24 per cent., in Spain they are 25 per cent. and, yes, even in Singapore they are 16.6 per cent.

The hon. Member for Merthyr Tydfil and Rhymney mentioned changes in our programmes and spoke about overnight cuts. Talk about overnight cuts sits ill in the mouth of the man who was Minister when the International Monetary Fund came in to administer cuts in this country.

We have not heard of any policies from the Labour party. We have heard nothing about the much-vaunted welfare to work programme. That, of course, is a programme about subsidies to employers. I am puzzled that the Opposition can propose a policy advocating subsidies to employers that seems to me to recognise that employment costs are a deterrent to employment, at the same time as they advocate policies that would lead to dramatic increases in the costs of employment. Those policies are the minimum wage, which the whole House knows will increase the costs of employment; the social chapter—

Mr. Meacher

The Minister does not know what the level will be.

Mr. Paice

If the level is not high enough to increase the cost of employment, it will not be much of a minimum wage, will it? Any minimum wage that increases wages, which I presume is the intention behind it, will increase costs and therefore reduce employment.

The social chapter would impose more potential costs on employers. Is it not odd that we have received no explanation of the statement that the Leader of the Opposition made to the Confederation of British Industry that he would not agree to any extra burden on employers, even though he would join the social chapter—as though he could pick and choose? Does not he realise, does not the hon. Member for Oldham, West understand, that the social chapter involves qualified majority voting? What wonderful system has the Labour party now invented that would prevent Britain being outvoted and saddled with job-destroying burdens?

We have heard nothing of the windfall tax, Labour's latest milch cow—a tax which, at the last count, was going to fund 11 different spending pledges, a £75 a week incentive for long-term unemployed people, child care provision, VAT relief to small business, an environmental task force and many other things, including, apparently, the removal of lead piping. The Leader of the Opposition advocates a programme of home insulation.

What a tax. What a con trick. Do not the Opposition understand that a principle of a windfall tax is that it is a once and for all tax? How will they fund those programmes in the following years?

What about the other Labour flagship, the training levy—another impost on employers because Labour knows best? Yet again, we find confusion. The hon. Member for Peckham (Ms Harman) said last year, when she was in charge: We have concluded that the old levy/grant system is no longer appropriate". We have heard no policy of substance tonight—no explanation of what stakeholder training might be. The Government have trebled the proportion of graduates. We have developed modern apprenticeships and we have focused employers' responsibility for training through the investors in people initiative. We have abolished all the statutory levies and training boards and we have seen a rise in training volume and quality.

Yet we have been opposed at every turn—as least we were opposed until the Labour party realised that we were right. After 16 years, Labour now accepts that the levy will not work. How much longer will the minimum wage or the social chapter last before they, too, are consigned to the dustbin of Labour policies?

The Government remain committed to an effective training policy which we shall continue to deliver through TECs and the extra money that they shall receive next year. I commend the amendment to the House.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 269, Noes 306.

Division No. 25] [10.00
Abbott, Ms Diane Corbett, Robin
Adams, Mrs Irene Corbyn, Jeremy
Ainger, Nick Corston, Jean
Ainsworth, Robert (Cov'try NE) Cousins, Jim
Allen, Graham Cunliffe, Lawrence
Alton, David Cunningham, Jim (Covy SE)
Anderson, Donald (Swansea E) Cunningham, Rt Hon Dr John
Armstrong, Hilary Cunningham, Roseanna
Ashton, Joe Dafis, Cynog
Austin-Walker, John Darling, Alistair
Banks, Tony (Newham NW) Davidson, Ian
Battle, John Davies, Bryan (Oldham C'tral)
Bayley, Hugh Davies, Chris (L'Boro & S'worth)
Beckett, Rt Hon Margaret Davies, Rt Hon Denzil (Llanelli)
Beggs, Roy Davies, Ron (Caerphilly)
Bell, Stuart Davis, Terry (B'ham, H'dge H'l)
Benn, Rt Hon Tony Denham, John
Bennett, Andrew F Dewar, Donald
Benton, Joe Dixon, Don
Bermingham, Gerald Dobson, Frank
Berry, Roger Donohoe, Brian H
Betts, Clive Dowd, Jim
Blunkett, David Dunwoody, Mrs Gwyneth
Boateng, Paul Eagle, Ms Angela
Bradley, Keith Eastham, Ken
Bray, Dr Jeremy Etherington, Bill
Brown, Gordon (Dunfermline E) Evans, John (St Helens N)
Brown, N (N'c'tle upon Tyne E) Fatchett, Derek
Bruce, Malcolm (Gordon) Faulds, Andrew
Burden, Richard Field, Frank (Birkenhead)
Byers, Stephen Fisher, Mark
Callaghan, Jim Flynn, Paul
Campbell, Mrs Anne (C'bridge) Foster, Rt Hon Derek
Campbell, Menzies (Fife NE) Foster, Don (Bath)
Campbell, Ronnie (Blyth V) Foulkes, George
Campbell-Savours, D N Fyfe, Maria
Canavan, Dennis Galbraith, Sam
Cann, Jamie Galloway, George
Chisholm, Malcolm Gapes, Mike
Church, Judith Garrett, John
Clapham, Michael George, Bruce
Clark, Dr David (South Shields) Gerrard, Neil
Clarke, Eric (Midlothian) Gilbert, Rt Hon Dr John
Clarke, Tom (Monklands W) Godman, Dr Norman A
Clelland, David Godsiff, Roger
Clwyd, Mrs Ann Golding, Mrs Llin
Cohen, Harry Graham, Thomas
Cook, Frank (Stockton N) Grant, Bernie (Tottenham)
Cook, Robin (Livingston) Griffiths, Nigel (Edinburgh S)
Griffiths, Win (Bridgend) Meale, Alan
Grocott, Bruce Michael, Alun
Hain, Peter Michie, Bill (Sheffield Heeley)
Hall, Mike Milburn, Alan
Hanson, David Miller, Andrew
Hardy, Peter Mitchell, Austin (Gt Grimsby)
Harman, Ms Harriet Moonie, Dr Lewis
Harvey, Nick Morgan, Rhodri
Hattersley, Rt Hon Roy Morley, Elliot
Henderson, Doug Morris, Rt Hon Alfred (Wy'nshawe)
Heppell, John Morris, Estelle (B'ham Yardley)
Hill, Keith (Streatham) Morris, Rt Hon John (Aberavon)
Hinchliffe, David Mowlam, Marjorie
Hodge, Margaret Mudie, George
Hoey, Kate Mullin, Chris
Hogg, Norman (Cumbernauld) Murphy, Paul
Home Robertson, John Nicholson, Emma (Devon West)
Hood, Jimmy Oakes, Rt Hon Gordon
Hoon, Geoffrey O'Brien, Mike (N W'kshire)
Howarth, Alan (Strat'rd-on-A) O'Brien, William (Normanton)
Howarth, George (Knowsley North) O'Hara, Edward
Howells, Dr Kim (Pontypridd) Olner, Bill
Hoyle, Doug O'Neill, Martin
Hughes, Robert (Aberdeen N) Orme, Rt Hon Stanley
Hughes, Roy (Newport E) Pearson, Ian
Hutton, John Pendry, Tom
Illsley, Eric Pickthall, Colin
Ingram, Adam Pike, Peter L
Jackson, Glenda (H'stead) Pope, Greg
Jackson, Helen (Shef'ld, H) Powell, Ray (Ogmore)
Jamieson, David Prentice, Bridget (Lew'm E)
Janner, Greville Prentice, Gordon (Pendle)
Jones, Barry (Alyn and D'side) Prescott, Rt Hon John
Jones, leuan Wyn (Ynys Môn) Primarolo, Dawn
Jones, Jon Owen (Cardiff C) Purchase, Ken
Jones, Lynne (B'ham S O) Quin, Ms Joyce
Jones, Martyn (Clwyd, SW) Radice, Giles
Jowell, Tessa Randall, Stuart
Kaufman, Rt Hon Gerald Raynsford, Nick
Keen, Alan Reid, Dr John
Kennedy, Charles (Ross,C&S) Rendel, David
Kennedy, Jane (Lpool Brdgn) Robertson, George (Hamilton)
Khabra, Piara S Robinson, Geoffrey (Co'try NW)
Kilfoyle, Peter Roche, Mrs Barbara
Kirkwood, Archy Rogers, Allan
Lestor, Joan (Eccles) Rooker, Jeff
Liddell, Mrs Helen Rooney, Terry
Litherland, Robert Ross, Ernie (Dundee W)
Livingstone, Ken Ross, William (E Londonderry)
Lloyd, Tony (Stretford) Rowlands, Ted
Llwyd, Elfyn Ruddock, Joan
Lynne, Ms Liz Sedgemore, Brian
McAllion, John Sheerman, Barry
McAvoy, Thomas Sheldon, Rt Hon Robert
McCartney, Ian Shore, Rt Hon Peter
McCrea, The Reverend William Short, Clare
Macdonald, Calum Simpson, Alan
McFall, John Skinner, Dennis
McKelvey, William Smith, Andrew (Oxford E)
Mackinlay, Andrew Smith, Llew (Blaenau Gwent)
McLeish, Henry Smyth, The Reverend Martin (Belfast S)
McMaster, Gordon
McNamara, Kevin Snape, Peter
MacShane, Denis Spearing, Nigel
McWilliam, John Spellar, John
Madden, Max Squire, Rachel (Dunfermline W)
Maddock, Diana Steinberg, Gerry
Mahon, Alice Stevenson, George
Mandelson, Peter Stott, Roger
Marek, Dr John Sutcliffe, Gerry
Marshall, David (Shettleston) Taylor, Mrs Ann (Dewsbury)
Marshall, Jim (Leicester, S) Taylor, Rt Hon John D (Strgfd)
Martin, Michael J (Springburn) Taylor, Matthew (Truro)
Martlew, Eric Thompson, Jack (Wansbeck)
Maxton, John Timms, Stephen
Meacher, Michael Tipping, Paddy
Touhig, Don Williams, Alan W (Carmarthen)
Turner, Dennis Wilson, Brian
Tyler, Paul Winnick, David
Vaz, Keith Wise, Audrey
Walker, Rt Hon Sir Harold Worthington, Tony
Wallace, James Wray, Jimmy
Walley, Joan Wright, Dr Tony
Wardell, Gareth (Gower) Young, David (Bolton SE)
Wareing, Robert N
Watson, Mike Tellers for the Ayes:
Welsh, Andrew Mr. John Cummings and
Williams, Rt Hon Alan (Sw'n W) Ms Ann Coffey.
Ainsworth, Peter (East Surrey) Couchman, James
Aitken, Rt Hon Jonathan Cran, James
Alexander, Richard Currie, Mrs Edwina (S D'by'ire)
Alison, Rt Hon Michael (Selby) Curry, David (Skipton & Ripon)
Allason, Rupert (Torbay) Davies, Quentin (Stamford)
Amess, David Davis, David (Boothferry)
Ancram, Rt Hon Michael Day, Stephen
Arbuthnot, James Deva, Nirj Joseph
Arnold, Jacques (Gravesham) Devlin, Tim
Arnold, Sir Thomas (Hazel Grv) Dicks, Terry
Ashby, David Dorrell, Rt Hon Stephen
Atkins, Rt Hon Robert Douglas-Hamilton, Lord James
Atkinson, David (Bour'mouth E) Dover, Den
Atkinson, Peter (Hexham) Duncan, Alan
Baker, Rt Hon Kenneth (Mole V) Duncan-Smith, Iain
Baker, Nicholas (North Dorset) Dunn, Bob
Baldry, Tony Durant, Sir Anthony
Banks, Robert (Harrogate) Dykes, Hugh
Bates, Michael Eggar, Rt Hon Tim
Batiste, Spencer Elletson, Harold
Bellingham, Henry Emery, Rt Hon Sir Peter
Bendall, Vivian Evans, David (Welwyn Hatfield)
Beresford, Sir Paul Evans, Jonathan (Brecon)
Biffen, Rt Hon John Evans, Nigel (Ribble Valley)
Body, Sir Richard Evans, Roger (Monmouth)
Bonsor, Sir Nicholas Evennett, David
Booth, Hartley Faber, David
Boswell, Tim Fabricant, Michael
Bottomley, Peter (Eltham) Fenner, Dame Peggy
Bottomley, Rt Hon Virginia Field, Barry (Isle of Wight)
Bowden, Sir Andrew Fishburn, Dudley
Bowis, John Forman, Nigel
Boyson, Rt Hon Sir Rhodes Forsyth, Rt Hon Michael (Stirling)
Brandreth, Gyles Forth, Eric
Brazier, Julian Fowler, Rt Hon Sir Norman
Bright, Sir Graham Fox, Dr Liam (Woodspring)
Brooke, Rt Hon Peter Fox, Rt Hon Sir Marcus (Shipley)
Brown, M (Brigg & Cl'thorpes) Freeman, Rt Hon Roger
Browning, Mrs Angela French, Douglas
Bruce, Ian (Dorset) Gale, Roger
Budgen, Nicholas Gallie, Phil
Burt, Alistair Gardiner, Sir George
Butcher, John Garel-Jones, Rt Hon Tristan
Butler, Peter Garnier, Edward
Butterfill, John Gill, Christopher
Carlisle, John (Luton North) Gillan, Cheryl
Carlisle, Sir Kenneth (Lincoln) Goodlad, Rt Hon Alastair
Carrington, Matthew Goodson-Wickes, Dr Charles
Carttiss, Michael Gorman, Mrs Teresa
Cash, William Gorst, Sir John
Channon, Rt Hon Paul Grant, Sir A (SW Cambs)
Chapman, Sir Sydney Greenway, Harry (Ealing N)
Churchill, Mr Greenway, John (Ryedale)
Clappison, James Griffiths, Peter (Portsmouth, N)
Clark, Dr Michael (Rochford) Grylls, Sir Michael
Clarke, Rt Hon Kenneth (Ru'clif) Gummer, Rt Hon John Selwyn
Clifton-Brown, Geoffrey Hague, Rt Hon William
Coe, Sebastian Hamilton, Rt Hon Sir Archibald
Coombs, Anthony (Wyre For'st) Hamilton, Neil (Tatton)
Coombs, Simon (Swindon) Hampson, Dr Keith
Cope, Rt Hon Sir John Hanley, Rt Hon Jeremy
Cormack, Sir Patrick Hannam, Sir John
Hargreaves, Andrew Monro, Rt Hon Sir Hector
Harris, David Montgomery, Sir Fergus
Haselhurst, Sir Alan Moss, Malcolm
Hawkins, Nick Needham, Rt Hon Richard
Hawksley, Warren Neubert, Sir Michael
Hayes, Jerry Newton, Rt Hon Tony
Heald, Oliver Nicholls, Patrick
Heathcoat-Amory, Rt Hon David Nicholson, David (Taunton)
Hendry, Charles Norris, Steve
Hesettine, Rt Hon Michael Onslow, Rt Hon Sir Cranley
Higgins, Rt Hon Sir Terence Oppenheim, Phillip
Hill, James (Southampton Test) Ottaway, Richard
Hogg, Rt Hon Douglas (G'tham) Page, Richard
Horam, John Paice, James
Hordern, Rt Hon Sir Peter Patnick, Sir Irvine
Howard, Rt Hon Michael Patten, Rt Hon John
Howell, Rt Hon David (G'dord) Pattie, Rt Hon Sir Geoffrey
Howell, Sir Ralph (N Norfolk) Pawsey, James
Hughes, Robert G (Harrow W) Peacock, Mrs Elizabeth
Hunt, Rt Hon David (Wirral W) Pickles, Eric
Hunt, Sir John (Ravensbourne) Porter, Barry (Wirral S)
Hunter, Andrew Porter, David (Waveney)
Hurd, Rt Hon Douglas Portillo, Rt Hon Michael
Jack, Michael Powell, William (Corby)
Jackson, Robert (Wantage) Rathbone, Tim
Jenkin, Bernard Redwood, Rt Hon John
Jessel, Toby Renton, Rt Hon Tim
Johnson Smith, Sir Geoffrey Richards, Rod
Jones, Gwilym (Cardiff N) Riddick, Graham
Jones, Robert B (W Hertfdshr) Rifkind, Rt Hon Malcolm
Jopling, Rt Hon Michael Robathan, Andrew
Kellett-Bowman, Dame Elaine Roberts, Rt Hon Sir Wyn
Key, Robert Robertson, Raymond (Ab'd'n S)
King, Rt Hon Tom Robinson, Mark (Somerton)
Kirkhope, Timothy Roe, Mrs Marion (Broxbourne)
Knapman, Roger Rumbold, Rt Hon Dame Angela
Knight, Mrs Angela (Erewash) Sackville, Tom
Knight, Rt Hon Greg (Derby N) Sainsbury, Rt Hon Sir Timothy
Knight, Dame Jill (Bir'm E'st'n) Scott, Rt Hon Sir Nicholas
Knox, Sir David Shaw, David (Dover)
Kynoch, George (Kincardine) Shaw, Sir Giles (Pudsey)
Lett, Mrs Jacqui Shephard, Rt Hon Gillian
Lamont, Rt Hon Norman Shepherd, Sir Colin (Hereford)
Lang, Rt Hon Ian Shepherd, Richard (Aldridge)
Lawrence, Sir Ivan Shersby, Sir Michael
Legg, Barry Sims, Roger
Leigh, Edward Skeet, Sir Trevor
Lester, Sir James (Broxtowe) Smith, Sir Dudley (Warwick)
Lidington, David Smith, Tim (Beaconsfield)
Lilley, Rt Hon Peter Soames, Nicholas
Lloyd, Rt Hon Sir Peter (Fareham) Spencer, Sir Derek
Lord, Michael Spicer, Sir James (W Dorset)
Luff, Peter Spicer, Sir Michael (S Worcs)
Lyell, Rt Hon Sir Nicholas Spink, Dr Robert
MacGregor, Rt Hon John Spring, Richard
MacKay, Andrew Sproat, Iain
Maclean, Rt Hon David Squire, Robin (Hornchurch)
McLoughlin, Patrick Stanley, Rt Hon Sir John
McNair-Wilson, Sir Patrick Steen, Anthony
Madel, Sir David Stephen, Michael
Maitland, Lady Olga Stern, Michael
Malone, Gerald Stewart, Allan
Mans, Keith Streeter, Gary
Marland, Paul Sumberg, David
Marlow, Tony Sweeney, Wafter
Marshall, John (Hendon S) Sykes, John
Marlin, David (Portsmouth S) Tapsell, Sir Peter
Mates, Michael Taylor, Ian (Esher)
Mawhinney, Rt Hon Dr Brian Taylor, John M (Solihull)
Mayhew, Rt Hon Sir Patrick Taylor, Sir Teddy (Southend, E)
Mellor, Rt Hon David Temple-Morris, Peter
Merchant, Piers Thomason, Roy
Mills, Iain Thompson, Sir Donald (C'er V)
Mitchell, Andrew (Gedling) Thompson, Patrick (Norwich N)
Mitchell, Sir David (NW Hants) Thornton, Sir Malcolm
Moate, Sir Roger Thurnham, Peter
Townend, John (Bridlington) Whitney, Ray
Tracey, Richard Whittingdale, John
Tredinnick, David Widdecombe, Ann
Trend, Michael Wiggin, Sir Jerry
Trotter, Neville Wilkinson, John
Twinn, Dr Ian Willetts, David
Vaughan, Sir Gerard Wilshire, David
Viggers, Peter Winterton, Mrs Ann (Congleton)
Waldegrave, Rt Hon William Winterton, Nicholas (Macc'f'ld)
Walden, George Wolfson, Mark
Walker, Bill (N Tayside) Wood, Timothy
Waller, Gary Yeo, Tim
Ward, John Young, Rt Hon Sir George
Wardle, Charles (Bexhill)
Waterson, Nigel Tellers for the Noes:
Watts, John Mr. Derek Conway and
Wells, Bowen Mr. Simon Burns.

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 30 (Questions on amendments), and agreed to.

MR. DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.


That this House welcomes the fall in unemployment and rise in employment that have enabled more people to share in the benefits of economic growth; supports the Government's determination to give unemployed people the help they need to find work; and welcomes the Government's initiatives to raise standards of education and training and enhance the nation's competitiveness.
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