INDUSTRIAL TRAINING BILL (Hansard, 6 February 1964)

§ VISCOUNT BLAKENHAM

My Lords, I beg to move that this Bill be read a second time. The Bill has as its subject matter the men, women, boys and girls who are employed in the industry and commerce of this country, so we are dealing here with the nation's greatest asset—its manpower. We have few natural resources, and no country depends as much as we do on the quality and competitiveness of the goods that we export. If we are to survive and prosper in an increasingly competitive world it will be only by developing to the full the skills and talents of all our people.

It has for many years been an accepted doctrine that the responsibility for training the skilled workers that industry requires should rest on industry itself, but in the last two or three years the climate of opinion within industry has changed. A number of organisations and individuals have helped to bring about this change, and in this some of us here in this House can claim, without, I believe, undue immodesty, to have played our part. Certainly there is now widespread agreement that the present arrangements for industrial training are simply not good enough.

They are not good enough, my Lords, for three reasons. First, they have failed to produce skilled workers in the numbers 255 that industry requires. Ever since the war, with few exceptions, skilled workers of various kinds have been in short supply. This has held up expansion in many sectors of industry, and not least in those parts of the country where unemployment has been higher than the national average. Skilled workers create employment opportunities for the unskilled. Despite the good work done by the Industrial Training Council (and I see that my noble friend Lord McCorquodale of Newton who was a former President of the Council, is to speak) and other organisations in recent years to step up the number of apprenticeships, there are ominous signs in some parts of the country that skilled labour is in increasingly short supply. If we are to pursue successfully the policy of economic growth which is vital to our future, we shall undoubtedly need many more skilled workers than we now have, or are likely to obtain if present practices continue.

Our existing arrangements have also failed to provide enough training of the right kind and of a sufficiently high standard. At one end of the scale we have training which is probably unequalled anywhere in the world; at the other extreme we have what might more properly be called, not training but what I can describe only as "time exposure". Training has tended to be concentrated on the traditional apprenticeship occupations, while the increasingly important technician grades and various new classes of operative have been largely ignored. Many firms have failed to take advantage of the opportunities for technical education which the enormous expansion of the technical colleges and other institutions of further education have placed at their disposal.

More generally there has been a failure to bring training practices up to date and to exploit new techniques of training. During my period of office as Minister of Labour I asked some of the leading apprentice-employing industries on a number of occasions to re-examine their existing training arrangements to see whether they measured up to the needs of the second half of the twentieth century, and I must tell your Lordships that I was, quite frankly, deeply disappointed with their response, and particularly at the rigid adherence to 256 that "sacred cow", the five-year period of apprenticeship. Only in the building industry are there signs of this being adapted to modern needs.

Thirdly, and lastly, our present arrangements have resulted in some firms providing, and paying for, training, while others have done no training at all but have obtained the skilled workers they need by poaching from those who have. Here undoubtedly is a sphere in which virtue has not been its own reward. It is surely only fair that all firms which benefit from training should pay their share of the cost of providing it.

It was the need to remedy these shortcomings—the shortage of skilled manpower, the uneven standards of training and the unfair distribution of training costs—that led the Government at the end of 1962 to publish its White Paper on Industrial Training. The proposals in the White Paper were the subject of first-class debates in both Houses of Parliament, and provoked lively discussion in industrial and educational circles all over the country. Officials of the Ministry of Labour, in close co-operation with the Ministry of Education and the Scottish Education Department, discussed them in detail with industrial and educational organisations. This involved them in no fewer than 150 meetings of one kind and another. This Bill is the outcome. As your Lordships will see, it has been drafted in the closest consultation with those who are likely to be most affected by it.

This is a Bill of major importance and one that is intended to be revolutionary in its effect. It is surely both remarkable and encouraging that a measure of this kind should have won such widespread support. I believe that the Bill provides the means for real and lively partnership between Government, industry and the educational world to improve training in industry and commerce. While industry must continue to bear the major burden of cost and responsibility, the Bill recognises the important part which educational institutions can play in assisting it to obtain its skilled manpower at all levels. The provision of facilities for further education will remain, as now, the responsibility of the education authorities. But it is impossible to keep training and 257 education in two watertight compartments.

The decision to raise the school-leaving age to sixteen, which my right honourable friend the Minister of Education announced in another place last week, is bound to have an effect on industrial training and work to its ultimate advantage. Similarly, as the Newsom report recognised, the last year at school will gain a new sense of purpose if it is more closely linked with the industrial world of which the school leaver will eventually find himself a member. Newsom, Robbins and this Bill all form part of a coherent pattern. In carrying out his responsibilities under the Bill my right honourable friend the Minister of Labour intends to work in the closest co-operation with my right honourable friends the Minister of Education and the Secretary of State for Scotland. I can assure your Lordships that this partnership between the three Departments will be a very real one. I thought it right to dwell on these important general issues which have influenced the Government in the introduction of the Bill.

I should now like to turn to the Bill's main provisions. Clause 1 enables the Minister of Labour to establish training boards for such activities of industry or commerce as he may specify. Before he sets up a board, the Minister will be required to consult organisations representing employers and employees in the industry concerned. The wording of the clause, which is similar to that in the Industrial Organisation and Development Act, 1947, allows considerable flexibility in the definition of an industry. I must make it clear, however, that the Minister's intention is to establish boards, not for certain occupations or groups of occupations, but for industries as that term is normally understood. This means that boards will be responsible for a fairly wide range of occupations, and that a number of boards will be concerned with the same or similar occupations. This could certainly raise problems. But I have no doubt that, by a sensible use of the power given by the Bill to appoint committees, and by the application of common sense, these can be overcome. I am quite sure that an occupational approach, cutting across the existing organisation of industry, would have proved quite unworkable.

258 The composition of the boards is laid down in the Schedule.

§ VISCOUNT BLAKENHAM

My Lords, I think a simple illustration in answer to the noble Lord is this. Obviously, if one takes the chemical industry or the coalmining industry, or many of our major industries, there will be a large number of engineers working in those industries in one capacity or another. Therefore, although technically they are engineers, they do not come within the engineering industry and, as such, have to be trained in the skills in which normally an engineer within the engineering industry would be trained. Therefore, I think it was right to stick to this industry approach rather than the occupational approach.

On the question of the composition of the boards, all a board's members will be appointed by the Minister. They will consist of a chairman, who must have commercial or industrial experience an equal number of employer and worker members; and members appointed after consultation with the Minister of Education and the Secretary of State for Scotland. In addition, the Minister of Labour and the Education Ministers will each be empowered to appoint an officer to attend the meetings of a board, but not to vote.

Paragraph 5 of the Schedule provides that neither the chairman nor the educational members shall have a vote on matters relating to the imposition of a levy. I think this is right. The employers in the industry will have to pay the levy, and the workers will be directly affected by the decisions of the board. I would describe this as the principle of "no taxation without representation" in reverse. Those directly affected by the calling of the tune will decide how much the piper is to be paid.

On all other matters the educational members will have a right to vote, as 259 will the chairman. Because there will be no casting vote it would in theory be possible for the board to reach no agreement on the levy proposals it should submit to the Minister.

I would, however, draw your Lordships' attention to the reserve powers which Clause 7 gives to the Minister. If a board fails to submit proposals, the Minister can direct it to do so. If it fails to carry out this direction the Minister can dismiss the board and replace its members by his own nominees. These are drastic powers, but the very fact that they exist should be a strong incentive to a board to reach agreement on this point.

Clause 2 sets out the functions of the boards. A board will have two main duties: to ensure that the amount of training in its industry is sufficient, and to publish recommendations about the nature and length of training for different occupations and the further education that should be associated with that training. Boards will be required to exercise their functions in accordance with proposals submitted to, and approved by, the Minister. Before a board can decide the amount of training its industry needs, it will have to decide what its future requirements for trained manpower are going to be. Your Lordships will agree that this will not be an easy thing to do. Technology refuses to stand still and the pace of change is likely to increase rapidly. Just as the blacksmith has given way to the motor mechanic and the riveter to the welder, so the need for some skills will decline and others will take their place. Not only must boards be prepared for this; they must positively encourage it and adapt their training programmes accordingly.

The Manpower Research Unit which has been set up in the Ministry of Labour will do everything it can to assist boards to do this necessary piece of crystal gazing. In addition, of course, they will co-operate very closely with the economic development committee now being set up by the National Economic and Development Council. Having decided what the manpower requirements of its industry are likely to be, a board will then have to make sure that sufficient training is done to meet them.

260 The Bill empowers a board to make grants to employers and others who provide training of which it approves. This will enable a board, if it so wishes, to make use of facilities available in Government training centres and of courses of integrated training and education provided by the technical colleges. A board will have the power to organise, or support, group training schemes in which a number of employers join together to provide training for their employees. A board will also be empowered to set up its own training centres if it considers this necessary. These are some of the means which a board will have at its disposal for carrying out its duty to ensure that sufficient training is available.

As for standards of training, though the board's views will be expressed in the form of recommendations, these will be recommendations only in the sense that no employer will be obliged to follow them. If, however, an employer wishes to obtain a grant from a board for the training he does, he will have to comply with the recommendations which the board has made. This financial weapon is likely to prove a very effective sanction. It was suggested in another place that boards should be given the power to make it compulsory for employers to release their apprentices to attend educational classes at technical colleges. To do this would be quite contrary to the spirit of the Bill. It will, however, be within the powers of a board to recommend that release to attend classes of further education should be an essential constituent of the training for a particular occupation. Any employer who failed to comply with this recommendation would find himself unable to obtain a grant from the board.

The powers of the board will relate to all occupations and to people of all ages. A number of people have assumed that, because the Bill does not use the word "retraining", and because it does not specifically mention adults, the board's responsibilities will be limited to the initial, basic training of young people. This is most certainly not the case. I have already referred to the quickening pace of technological change. I am quite sure that, in future, industries are going to have to devote an increasing proportion of their training effort to 261 enabling adults to acquire new skills and to adapt themselves to new processes and techniques. Therefore, I want to make the point very clear that adults come within the scope of the Bill.

Clause 4 provides the fuel for the board's machinery: the levy. Every board will be required from time to time to impose a levy on employers in its industry. The purpose of this is, first, to raise the funds to enable the board to carry out its functions; secondly, to provide an incentive to employers to train; and, thirdly, to distribute the costs of training evenly between all firms. I have already referred to the fact that the board's proposals on the levy will have to be submitted to the Minister. If he approves them he will make a levy order accordingly.

Apart from the requirement to supply information, the obligation to pay a levy is the only duty which the Bill places on an individual employer. No employer will be obliged to train. But it will no longer be possible for a firm to obtain its trained manpower at the rest of the industry's expense. The converse is also true. It will be possible for the firm which provides more than its fair share of training to receive back from the board in grant more than it pays in levy. I think we can expect many of the firms which now provide excellent training, and have the capacity to do more, to take advantage of this, to their own and the industry's good.

Clause 5 empowers the Minister to make grants or loans to training boards. The main part of the cost of the boards' work must be met by industry through the levy. But the Government think it right that the Government themselves should make a contribution, and the limit of £50 million included in the Bill shows the very real importance we attach to this. Both the amount of the Government contribution and the way it is to be applied will be a matter for discussion with individual boards as they are set up and formulate their plans. I have already touched on Clause 7 and the reserve powers this gives to the Minister. These will apply not merely to levy proposals 262 but to all the proposals which a board is required to submit to the Minister. It is the Government's fervent hope that these powers will never have to be used.

My Lords, the only other clause which I should like to draw to your Lordships' particular attention is Clause 11. This provides for the setting up of an advisory body to be known as the Central Training Council. There are some people who argued that the Council should be an executive body. They wished to see it play a rôle similar to that which the Bill gives to the Minister, and to be responsible in some measure for the implementation of the Bill. I am afraid the Bill has disappointed them, but, I think, rightly so. It would have been a constitutional anomaly to give to a Council which was not directly responsible to Parliament responsibility for implementing the Act and dispensing considerable sums of public money. But let there be no doubt that the Central Training Council will have the power to exert an important influence, as an advisory body, on the development of industrial training in this country. My right honourable friend will certainly seek its advice on a wide range of issues and I would expect its reports to have a considerable impact.

My Lords, I believe this Bill will achieve two things. As the years go by it should make for a big improvement in our industrial efficiency, and so increase our capacity to raise our living standards, while at the same time making a positive contribution to the development of the new countries and to the maintenance of peace in the world. It will also offer to all those in employment in industry or commerce a far better opportunity of developing their talents to the full. On both these broad counts I commend the Bill to your Lordships. Progress is sometimes difficult to measure, but in asking your Lordships to give this Bill a Second Reading I am asking for a milestone to be erected on the road to greater prosperity for the country and greater fulfilment for millions of our people? I beg to move.