Lords Sitting of 2 December 1981

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Norwich.

Hoover Limited: Redundancies
Lord Molloy: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will consider meeting representatives of the management and workforce of Hoover Limited of Perivale, Middlesex, in an endeavour to see how that company may be assisted to prevent its closure.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Earl Ferrers): My Lords, while the Government greatly regret the loss of jobs at Perivale, the organisation of Hoover's manufacturing activities is a matter for the commercial judgment of the company. The Manpower Services Commission will do all it can to help those who will be made redundant, but a meeting such as the noble Lord suggests would not be appropriate.
Lord Molloy: My Lords, is the noble Earl aware that for many thousands of families in West London his reply will be a great disappointment because Hoover Limited has been an industrial landmark for decades contributed to by those families since early after the First World War? Would he not at least be prepared to consider that, in so far as the ordinary folk in this area have contributed to the nation and to Hoover, perhaps a helping hand from the Government, even at this late stage, would be much appreciated?
Earl Ferrers: My Lords, I realise that the Hoover works, as the noble Lord has said, has been an industrial landmark for many years. However, it is not the duty of the Government to interfere in the commercial decisions of a company, however much the Government may regret the circumstances which bring them about. What we can do is to help regarding deployment of the people—which is done by the Manpower Services Commission. As I indicated in my original Answer, that is what the Government are doing.
Lord Molloy: My Lords, is the noble Earl aware that we have had the submission he has just made in respect of the 3 million who are already on the dole and the Government have not been very successful in their endeavours to find alternative employment? I am not asking for interference in the company's affairs, but I would ask the Government to make an endeavour to take away one aspect of the bitterness that prevails in West London; namely, that it is the multi-national aspect of the situation that grieves them, and in as much as another Government—that of the United
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States—may be involved, the British ought to have the pluck to stand by British workers to see if they can make a contribution to saving this great firm. It has done so much for the American economy and so much for the British economy and it might have much still to give. I ask the Government not to interfere but to consider whether they can make a contribution.
Earl Ferrers: My Lords, I have explained that the Government have considered whether they can make a contribution and how best they can make it. I can only say that when an industrial company has lost £2·75 million in the last year and £13 million in the first nine months of this year it is bound to have to take strident measures, many of them unacceptable, to deal with that position. When the noble Lord refers to the internationality of the problem, I would remind him that the recession in which we are all involved is an international one which affects other countries as well as ourselves.
Lord Cledwyn of Penrhos: My Lords, if the situation in Perivale is serious, the situation in Merthyr Tydfil, where Hoover also have a large plant, is infinitely more serious. As the noble Earl will be well aware the unemployment figure in Wales is extraordinarily grave at the present time. Can the noble Earl say what steps are being taken by the National Enterprise Board—which his Government have largely emasculated—in relation to Hoover nationally, and what steps the Welsh Development Agency are taking in Wales to assist those who have been made redundant and unemployed in the Merthyr Tydfil area?
Earl Ferrers: My Lords, there are some 2,430 people employed by Hoover in the Merthyr Tydfil area, of whom some 400 will be made redundant. The same services will be offered by the Government in that case as in the case of Hoover in Perivale.

The "Black Economy"
2.42 p.m.
Lord Thomas of Swynnerton: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what they are going to do about the so-called "black economy".
The Minister of State, Treasury (Lord Cockfield): My Lords, both revenue boards keep their procedures for the detection and prevention of evasion under constant review; and additional resources have been allocated for this purpose by redeployment of staff. Thus, it has recently been announced that the Inland Revenue is to redeploy some 400 staff to counter tax evasion in the black economy.
Lord Thomas of Swynnerton: My Lords, I am grateful to my noble friend for that reply. I wonder whether he has had the opportunity of seeing a recent article in the Journal of Economic Affairs which suggests that the size of the co-called "black economy" may be approaching £28,000 million.
Lord Cockfield: My Lords, this is an important matter; it needs to be taken seriously and we do take it seriously. Nevertheless, I do not think it helps to exaggerate the figures. My noble friend referred to the work of Professor Feige and the article that he wrote in a recent issue of the Journal of Economic Affairs. That article starts with the words:
"I count myself among the growing number of macro-economists who sense that there is something terribly amiss with our profession".
There are some people who might think that those words could equally be applied to Professor Feige's estimates.
Lord Thomas of Swynnerton: My Lords, I am grateful for that supplementary reply. Bearing in mind the wide discrepancy which seems to exist on this very important matter, and considering that the subject is one which affects practically all aspects of society—both morals and the collection of national statistics—would my noble friend consider it desirable to have a debate in which this matter may be further discussed?
Lord Cockfield: My Lords, my noble friend raises the question of a debate. That is not a matter for me to deal with. A large number of estimates of the size of the black economy have been produced by various people: by Sir William Pile in evidence to the Expenditure Committee in another place; Sir Lawrence Airey recently in evidence to the Public Accounts Committee; and estimates have been produced by the Institute of Economic Affairs, by the Institute of Fiscal Studies and by the Central Statistical Office. They tend to range over a very wide span. The important aspect, rather than trying to estimate something which is inherently impossible to estimate —because one is dealing with something which people are deliberately trying to conceal—is to come to grips with the problem. Both revenue departments are doing so and have shown considerable success in that direction.
Lord Paget of Northampton: My Lords, there are two questions which I should like to put to the noble Lord with regard to this problem. First, how many of your Lordships have never paid for some services in cash? Also, how many are naïve enough not to know why they did so?
Lord Cockfield: My Lords, I am answerable only for myself and not for others of your Lordships.
Lord Spens: My Lords, is the Minister aware that the size of the black economy may not be as great as people say? For example, there are 10 million pensioners and each pensioner is entitled to earn £1,800 a year before he comes within the purview of the Inland Revenue. If they were all to earn £1,800 a year, that would be £18 billion of perfectly legitimate economy.
Lord Cockfield: My Lords, I very much fear that I cannot entirely agree with the noble Lord. The retirement pension itself is liable to tax, so that in deciding whether a person is or is not liable to income
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tax one has to add together the retirement pension plus his other earnings. But normally in cases of the kind that the noble Lord mentions the other earnings would be picked up through the PAYE procedure anyway.
Lord Wallace of Coslany: My Lords, is the noble Lord aware that the Inland Revenue is at least very competent and efficient in one direction; as soon as the state old-age pension is raised those of us who also receive another pension receive a prompt notice some seven days before the increase which indicates an increase in our schedule and taxation?
Lord Cockfield: My Lords, I am grateful to the noble Lord for his tribute to the Inland Revenue. As pensions are liable to income tax—a situation which has always existed—it is obviously for the benefit and convenience of everybody that the system should work as effectively and efficiently as possible. I am grateful to the noble Lord for his tribute that it does do so.
Viscount St. Davids: My Lords, would the noble Lord not agree that, though it is of course very right to suppress any form of illegality, it would be better, if it can possibly be done, to cause all these small forms of private enterprise to move over slightly so as to bring them within the legitimate field of occupations, and thus produce a new young crop of legitimate enterprises which we so badly need?
Lord Cockfield: Yes, my Lords, that is a very highly desirable objective.
Lord Beswick: My Lords, does the noble Lord recall that in the debate on the Queen's Speech he claimed that he had reduced the number of Inland Revenue officers below the level of the Royal Naval strength? Does he not think that this reduction has something to do with the fact that so much tax is not now being collected?
Lord Cockfield: No, my Lords, that does not follow. The total staff of the two revenue departments is now just below 100,000. The important aspect is the way that those staff are deployed rather than the absolute numbers. Both revenue boards are directing their efforts very much to this particular problem.
Lord Wells-Pestell: My Lords, is the noble Lord aware that he has not answered his noble friend's question as to whether there should be a debate on this matter? Would he not inform his noble friend that he is entitled to have a debate on this matter if he wants one?
Lord Cockfield: My Lords, with respect to the noble Lord, I did answer the question. I said it was not for me to deal with.

Civic Government (Scotland) Bill [H.L.]
Lord Lyell: My Lords, on behalf of my noble friend Lord Mansfield, I beg to move the Motion standing in his name on the Order Paper.
Moved, That it be an instruction to the Committee of the Whole House to whom the Civic Government (Scotland) Bill has been committed that they consider the Bill in the following order:

Clauses 1 to 4

Schedule 1

Clauses 5 to 132

Schedules 2 and 3.

—(Lord Lyell.)
On Question, Motion agreed to.

Education, Training and Industrial Efficiency
2.50 p.m.
Baroness David Baroness David rose to call attention to the effects of Government policies on education, training opportunities and industrial efficiency; and to move for Papers.
The noble Baroness said: My Lords, I believe it is the first time the noble Lord, Lord Elton, has spoken from the Government Front Bench on education in this Session, so may I congratulate him on that? We have faced each other from opposite sides of the House before and I am sure we shall have an interesting debate.
It is almost six months since we had our last debate on education. In view of Mr. Heseltine's proposals for dealing with local authorities, although I understand he has been forced to have second thoughts about his Bill, and the arrival of three new Ministers at the department—the remaining one having a change of responsibility—it seems a fitting time to take stock to find out what the Government are thinking, to point out yet again the very serious situation the education service is facing and the effect of that situation on the social wellbeing of the country, on the productive capacity of the country and particularly on industry. My noble friend Lord McCarthy will be dealing with the industrial training side when he speaks. We thought it right that education and training should be looked at together.
I was astonished that the Queen's Speech made reference neither to education nor training. It expressed concern at the growth of unemployment, but there was no word of proposed legislation to ensure the further education and training of young people who have yet to find jobs or the retraining of adults who have lost their jobs. What instead followed the perfunctory expression of concern was:
"A Bill will be introduced on employment and labour relations".
Do the Government really believe that the best policy for rallying the nation is all stick and no carrot? I, along with many others, had been expecting that as a result of the publication last May of A New Training Initiative and last June of The Legal Basis of Further Education there would be some action. The chairman's preface to the latter document points out that the Government,
"recognising the apparently unsatisfactory state of the law as it stands",
set up his working group to make a study. I ask the Minister, who has now had the study and the responses to it, if and when action is to be taken to remedy that
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unsatisfactory state. Action is desperately needed, with 300,000 under 18 registered as unemployed and nearly 2 million under 25. This October there were 39 school-leavers for every vacancy, as compared with 18 a year ago. We shall doubtless be told that the YOP is expanding. The Prime Minister in her July speech, outlining her package of unemployment measures, said that the target for the programme would be for 550,000 young people in 1981–82. Of course we welcome any help, but this is an emergency measure. These young people are taken off the employment register, but of course they are available for work; they are not in work. The Labour Party will shortly be publishing its proposals for giving all 16- and 17 year-olds, whether in full-time education, at work, or unemployed, a right to tertiary education and a right to receive systematic education and training by way of a student traineeship. Personally, I should like to see a period of community service as part of that traineeship and I hope in fact that would be included and also that there would be a youth wage. Employers would be given a statutory obligation to provide opportunities for their young employees to receive education and training. Incentive training grants would be paid to employers towards meeting the costs. The scheme will be very expensive but it should be a top priority.
Are the Government content to make no change in their policies and to accept the position where 44 per cent. of 16 year-olds have neither full-time general education nor full-time vocational education, in contrast to 19 per cent. in France and 7 per cent. in West Germany? The Manpower Services Commission in A New Training Initiative said:
"We must move towards a position where all young people under the age of 18 have the opportunity either of continuing in full-time employment or of entering training for a period of planned work experience".
I understand the MSC's proposals on this have been sent to Mr. Tebbit, and from today's Times it looks as though they will be very similar to Labour's plans. They also raise the question of legislation. The Times suggested £500 million might be spent on this programme. The Guardian suggested £900 million. I do hope the Minister can give us some information on this when he replies. Have there, in fact, been ongoing consultations with the MSC? I should like to know whether the Government are minded to take their advice and follow the proposals they are bringing forward.
As it is, those leaving school are getting even fewer chances than they had. On 29th October I asked a Question about the Government's intentions with regard to 16 year-olds who could not get on to courses this autumn, and specified in my supplementary six colleges that had rejected over 1,800 students. I have information on a great many other colleges where the same thing has happened—Kingston over 1,000, Cornwall 430, Bradford 288 and Reading 300, to name but a few—where courses are full and students have to be turned away, often for courses like nursery nursing, catering and business studies. At my local Tech there are 160 applications for the foundation art course. Only 80 could be taken, and there is no similar course anywhere near.
Has the Minister any up-to-date figures on the students who have been disappointed this autumn?

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The legal position is that the authorities have an obligation to provide education for 16 to 19 year-olds. This was quite clear from the answers I had from the noble Lord, Lord Belstead, when I asked my Question on 29th October. What I hope very much is that parents or young people themselves will take action against those local authorities where educational training is not being provided. It seems to me they have a good case in law.
The extra £60 million promised for 1982–83 for help in this area will not help those young people this year, and it will not go all that far anyway. What, my Lords, is the sense of the Secretary of State for the Environment giving every councillor and administrator headaches scratching around for savings and cuts, which they have been doing for five years now, and then having the Secretary of State for Education telling them: "Hold on, here is an extra bit you can have"? As it is to be handed out as part of the RSG, who knows whether in the end it will go where it is intended? Will it be monitored in any way? I hope the Minister will tell us.
If the Government are to continue with the expansion of YOP and WEEP (work experience on employers' premises) as their main plank, I should like to ask one or two questions. How is the quality of what is to be provided to be monitored? Have the MSC adequate funds to monitor satisfactorily? If monitoring reveals abuse by the employer—that is, job substitution, failing to give day release—will places go on being taken up at his premises? Will the FE colleges, squeezed of funds as they have been, be capable of putting on the necessary courses and accepting students? Geoffrey Holland of the MSC said:
"Without the FE service, whatever opportunities are offered will be undoubtedly much poorer".
We know very well that the base is being eroded. Fears have been expressed that with the rapid expansion of YOP the quality has deteriorated. At first the majority of those taking part did get jobs when they completed their course. That is not so now. In May the noble Earl, Lord Gowrie, said it was 50 per cent. Can the Minister say what the figure is now? And if the YOP is to be an important and continuing part of the Government's provision it is vital that it should really be a Youth Opportunities Programme and not just a Youth Occupation Programme. Whether there will be legislation to secure the further education and training of the 16 to 19 year-olds remains to be seen.
In another area, I had hoped that new legislation would remove the ambiguous situation about adult education as set out in Section 41 of the 1944 Act. I hoped that there would be statutory recognition of the rights of all adults to have access to education. This was discussed in The Legal Basis. There was a division of opinion in the working group, as to whether LEAs should have a duty or only a power in this respect. I believe that it should be a duty.
Not only does this not seem a likely possibility, but the Heseltine proposals in respect of local government finance have caused deep pessimism in this adult education field—and anger. I have had numbers of letters on this subject. If LEA budgets are further
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curtailed, it is feared that adult education will take further severe knocks. So far, most LEAs have striven to keep some kind of service going, which could be a base to work on, should times ever improve, but the kind of service has changed. Centres have often had to be "self-financing"; fees have gone up; some courses have closed, while others have been made shorter; concessions to pensioners and the unemployed have been reduced or have gone altogether. NATFHE conducted a survey recently. Of 92 replies, 85 per cent. reported an increase in fees sometimes as great as 100 per cent.; 60 per cent. or 50 per cent. were mentioned very often.
Three weeks ago, I was asked to chair a meeting of adult tutors and members of the management committees of the seven centres in the City of Cambridge, in order to protest to the education committee as there was a threat to sack all tutors and close all centres at weekends. There was such an outcry at this that the threat has, at least temporarily, been removed. The Cambridgeshire CEO, Mr. Morris, told me that he did not want to be remembered as the Morris who dismantled the community college ideal that the other Cambridgeshire CEO, Mr. Morris, had created 60 years ago.
What is so sad and so cruel is that, at a time when there is appalling unemployment, earlier retirement and more leisure, these essential opportunities and interests are being taken away or, if not taken away, are being priced so high that only the affluent can afford them. I must quote from one letter that I had among the many. This one says:
"I have just, at 47 years old, started to study at an adult education institute in Bethnal Green and fear that, if the Bill becomes law, the ILEA will face savage cuts in its budget and my last opportunity of an education will be lost".
And that was typical of many.
I turn now from one kind of adult education to another—that of higher education in the university and public sector. I do not want to spend long on this as the subject was well aired in another place a fortnight ago. But a debate on education and training opportunities cannot avoid it altogether. Our last debate took place in the week when the vice-chancellors received their letters from the UGC. The letters had not arrived when we debated. Everyone guessed that body blows were on the way, but no one knew exactly where the blows would land or how hard they would be hit. So this is the first opportunity in this House to discuss the actual decisions.
To many, these decisions are inexplicable and the UGC refuses to explain them. The Government are crying out for links with industry and for technical skills, but those very universities that seemed to be supplying just that came out worst of all. We still have not heard that the Government have costed the contraction of the universities at the pace being asked for, or whether the anticipated savings would be made when redundancy and possible legal costs had been paid.
My noble friend Lord Wedderburn is particularly interested in this, and he told me that he wished he could have been here to pose these questions himself, but he said that, owing to the university cuts, he had an extra big teaching load which prevented him from appearing. Has the Secretary of State looked again

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at the time-scale—can we have an answer on this?—and has any costing been done? I also want to ask whether or not the Robbins principle is still accepted. Now that the Secretary of State has been told what that principle is, and has had time to think about it and, maybe, has redefined it, as he said he might, could we have his new definition?
Four thousand students have been turned away from universities this year. The Committee of Vice-Chancellors and Principals, in their submission to the Secretary of State on 9th November, said,
"Present Government policies will reduce opportunities for young people to go to university by about one in seven for the next two or three years".
They went on,
"The 15 per cent. funding reduction…roust mean the dismissal of substantial numbers of teaching, research and other university staff, beginning in the very near future … And this is happening at a time when the demand for university admissions from well-qualified young people and from mature students has never been higher".
How the Secretary of State can say, as he did to the Select Committee, that,
"the cuts would only cause minor damage and in a small number of areas",
is quite incomprehensible. As the Guardian leader said, "Sir Keith is talking through his hat", and I think that that was quite a polite comment. I am afraid that the universities will be forced to give up their innovatory schemes. They will become narrower, more élitist, more groves of Academe, when what we need is more open access, more opportunities for retraining for part-time students and more mature students, who may very well get squeezed out altogether.
The contractions of the university will put up applications to the polytechnics and then to the technical colleges. As a result, entrance requirements will be put up—they are being put up already, I know—so that the colleges will become more selective, too. There will be a gradual pushing out of the slightly less able but still capable young who could profit from higher and further education, and, at the tail end of the queue, the least able will he pushed right out on to the dole.
While the universities are making very loud noises about their cuts in a very well-orchestrated campaign, the public sector has been cut year by year for the last five years. As chairman for five years of the governors of the Cambridgeshire College of Advanced Technology, and still a governor, I have been all too aware of what was going on and of all the difficulties—equipment not being able to be replaced or becoming outdated; the risk of courses therefore not being validated by bodies such as the CNAA; students not being trained on the kind of machines that industry is now using and, of course, a reduction in staff.
Figures in The Times Higher Education Supplement suggest that spending on maintained higher education will drop from £337 million in 1980–81, to £311 million in 1981–82, £293 million in 1982–83 and down to £281 million in 1983–84, and this at the time of the peak in the number of 18 year-olds. In 1980, there were 879,000. The numbers go steadily up to 941,000 in 1983 and it is not till 1987 that they return to the 1980 figure. It is estimated that staff numbers will have to come down by 13 per cent. This must mean courses closing.
I asked my local tech, what effect cuts there had had this autumn. Fifty classes did not run, affecting 300 students. In the computer training area—very important for modern business and industry—the freezing of one post meant no lecturer in computer science, and this caused a number of classes to be cancelled. Fifteen well qualified scientists were turned away from a degree course. Next year, I am told, whole departments may have to go. The printing division is in danger—and printing is a major local industry. Where is the sense in it?—the folly and the waste and the teachers unemployed, too.
When the new committee which is to manage local authority higher expenditure, under the chairmanship of the Parliamentary Under-Secretary, meets to discuss the funding of public sector higher education, it will also be considering the academic provision to be made in institutions. I hope that it will not countenance the closing of courses which are valuable to industry, ust to get within an arbitrary money target. I must congratulate the department on their astute move in setting up this interim committee and getting themselves out of a tight spot and what looked like a major confrontation with the local authorities. I shall not be surprised, if it works, if the committee turns out not to be so interim.
While on higher education, I should like to put in a word of protest about the further rise in fees at the Open University. The Under-Secretary announced in October that fees would increase by a further 22 per cent. in 1982, making a 79 per cent. increase in two years. An OU student will have to find at least £1,100 to meet the cost of an eight credit honours degree course—more, of course, for a science degree. This pushes the Open University price well above that for part-time students at a conventional university or typical poly. What are the Government's intentions? Do they want the Open University to be selective, too, and to be outside the reach of most would-be students, the ones for whom that university was created? Do they want it to become a university of the South-East?
On grants, rumours have been flying around. I read today that the grant is to be increased by 4 per cent. next year, which will mean a big cut in real terms when already its value in real terms has been getting less. I hope the Minister can tell us whether these rumours are true and whether the minimum grant is to remain. I hope he can also tell us what is to happen to the parental contribution.
We very much regret that the cuts in local authority spending have severely reduced the number of discretionary grants. Local authorities have cut back beyond what was allowed for in the rate support grant. As one chief education officer said to me, we now have to look for reasons for not giving them. This yet again discriminates against the poorer section of the community. And that is what this Government's policies have done to ordinary people. Education at all levels has become more selective. Wherever you look—whether at nursery schools, extras like swimming and music in secondary schools, adult classes, the reduced value of mandatory grants, discretionary grants, Open University courses—if you can afford to pay you may get what you want. But you may possibly not, like many young people this autumn.
We should be very alarmed by the disaffection caused by the escalating unemployment among the young when at the same time their educational opportunities are being reduced. A lot of sensible, reasonable people have said to me that they are frightened at what might happen and we have certainly had warnings this year. Lord Scarman in his report speaks of deprivation and alienation and he calls for action now. I hope the Government are listening.
I visited Coventry last week. In co-operation with the Manpower Services Commission the city council has opened three workshops—"Top Shop", they call them—in redundant factory space to give the young unemployed some training, and to the same workshops every school in the city sends pupils for a fortnight. The young were working hard and with interest and the atmosphere was really good. Attendance was 96 per cent. We should contrast that with some of the school figures. We ought to ask questions about the suitability of the curriculum in our secondary schools. But the people I talked to who were running those workshops said that they wanted there to be no doubt in my mind that many of the young were bitterly resentful of society and what it had done to them. There is an explosive situation.
But the will to work is there. Look at the thousands who came by train and on foot to lobby at West-minister on Monday: Jobs for Youth. Every effort, I think, should be made to help them to find those jobs. And industry needs their skills. I beg to move.
3.14 p.m.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Elton): My Lords, I must thank the noble Baroness for her courteous welcome of myself to this Dispatch Box on this subject although not, of course, from this department. I should have been surprised that the speech of the noble Baroness entered upon the educational aspects of her Motion so late in the lives of pupils if I did not recall the recent history of her party because this House has just been privileged to hear the party which destroyed the entire direct grant grammar school system in England and Wales suggest that this Government have been harming education in this country.
In my view, the charges made in this Motion would have come a great deal better from the Liberal Party who have no track record in running education to defend—or even the Social Democrats who may be presumed to have repented individually of their earlier ways. None the less, even though it is inappropriately made, the charge is a serious one and deserves our serious attention. The main thrust of this Motion lies towards the arrangements under which a young person progresses through the final stages of education into the first stages of life in the world outside: the effect of education and training provision upon the industrial efficiency of this country. There has been a wide measure of concern about these provisions for a number of years. It was in response to this that the Secretary of State published, in March this year, a document called The School Curriculum. This document, which was circulated to every local education authority, resulted from extensive consultation. The
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consultation has revealed a very wide consensus of opinion about the way in which the problem should be tackled. The document carries the weight, therefore, not only of ministerial approval but also of a considerable degree of support among those whom it concerns. It can therefore be expected to have a marked influence upon them. It touches both primary and secondary schools but our concern today is principally with the latter, and anyone who reads the paper will see the emphasis that it lays upon the importance of preparing pupils for adult and working life. It calls on local education authorities to review their curriculum policies for their own areas and for schools to analyse and set out what they are now seeking to achieve for their leavers. It is not, and never has been, our belief that central Government should dictate the detail of what is taught in our schools; but the effect of the curriculum upon the nation's economy must concern Government. Indeed, the very terms of today's Motion—and what the noble Baroness has just said—imply such a responsibility, and we recognise it. That recognition is marked, both by our broad approach under The School Curriculum banner and also by our own response at individual subject level, as evidenced, for instance, by the Cockroft report on mathematics which will be published early next year.
Changes in the curriculum come about, as a rule, very slowly. Most of them have far-reaching effects within the teaching profession. Most of them require responses from the colleges of education. Almost all of them have implications for any system of examinations to which they relate and, of course, none can be introduced without due regard to those pupils who are already in mid-course under existing arrangements. Nevertheless, I believe this paper is already having an effect and progress will accordingly be formally reviewed in two years' time. The considerable number of schools which already provide work experience programmes and concentrate upon preparing pupils of all abilities to make the choices they will face in adult life will by then have a wealth of experience to offer and to share.
There are some ways, of course, in which what is taught in schools, and even the way it is taught, can be influenced more rapidly. That is why my right honourable friend the Prime Minister launched this summer a programme to get a micro-computer into every secondary school by the end of next year. Vouchers for more than 1,900 applications have already been approved and 831 micros have already been delivered. About £300,000 is being provided by the Department of Industry to help with the purchase of hardware and with travel as part of the in-service training back-up to the scheme. The scheme is being extended after 1st January 1982 to assist those schools which already had a micro when it started. This will bring the total cost of the scheme, based on 50 per cent. Government funding, to between £3·5 million and £4 million.
When money is short, it is more than ever essential that it should be wisely, imaginatively and effectively spent. This is a prime example of doing just that. More than half our secondary schools now do computer work. As a result of this programme, all of them will be able to do so in 13 months' time.
When a moment ago I regretted, with some passion, the passing of the direct grant schools I was regretting

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the destruction of a well-proven and an efficient means whereby academic excellence had been maintained and handed down through many generations, the guardian in many senses of both our cultural and our intellectual traditions. This Government do believe that excellence, wherever it is to be found, must be preserved. It is a vital and continuing thread in the life of our nation and if it were to snap the disaster would be economic as well as cultural. Governments have to preserve that thread. It is because my right honourable friend the Secretary of State for Education wishes to preserve what is best and of proven worth that he recently turned down a plan put forward by the Manchester education authority to scrap all the comprehensive sixth forms in that city, among them some with outstanding achievements, to make way for a system of sixth form colleges and 11-to-16 schools where the prospective advantages were inevitably less certain. Contrast that with the actions of the party opposite. Manchester was the home of perhaps the most famous of all direct grant grammar schools, at one time under the headmastership of the noble Lord, Lord James of Rusholme, until it was driven right out of the state system altogether by the very party which today accuses mine of damaging the education system of this country. Any damage that was done in Manchester was not done by us; it was done by them.
We had to bring in the assisted places scheme in 1980 simply to try to repair it on a national scale. Over 4,000 children are now in their first year as assisted pupils. Two-thirds of them came from families with incomes below the national average and over 1,300 of them pay no fees at all. But let us not suppose for one minute that our concern is only, or even chiefly, for those pupils of more than average ability. The GCE examinations, whether at advanced or ordinary level, are designed for only about a quarter of the pupils for whom we must provide. For some of the remainder we have the certificate of secondary education in its various modes. But neither system fully meets the needs of those whose gifts are definitely non-academic but whose real talents, which are of great value to the nation, deserve to be developed before they are put to use.
We believe that schools should look again at the curriculum they are offering to their less academically inclined pupils. They need to consider how it can be made more effective and more coherent, and that is why we are moving towards suggesting that the curriculum for all pupils aged 14 to 16 should have a greater practical emphasis. That is why we intend to use the reform of the system of examinations at 16-plus; the introduction of a single scale of grades with national criteria for syllabuses and assessment to build on the efforts of the examination boards which are of practical use to young people who enter employment at or soon after the end of compulsory education. That is why we are seriously examining the possibility of introducing a system of records for all school-leavers which would give credit for achievements and qualities which cannot be measured in formal examinations and which hitherto have vanished into the past after they passed through the school gate.
Moreover, we need to encourage young people with modest achievements at 16-plus in academic subjects to remain in full-time education, whether in schools
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or in colleges of further education, to develop the skills appropriate to their adult lives. In effect they are adults already. They certainly have adult aspirations. For them too often the classrooms represent so many shackles holding them down in the adolescent stratum of society. They need a good and relevant reason for delaying their escape into the adult world which they have for so long coveted.
My right honourable friend will therefore shortly be announcing our progress towards the launching of a new qualification for young people of 17-plus. It will include an essential curricular core of subjects, the learned skills most crucial to all adult careers, but these will be wedded to studies much more directly relevant to post-school experience. It will be aimed at a clientele which could be described as mid-way between the naturally academic traditions of secondary schools and the naturally technical traditions of colleges of further education. In order to develop this new approach—which will give these young people both a goal to work for and evidence of that work that will later be of use to them—we have been in consultation not only with the GCE and CSE boards, whose experience of the administration of traditional examinations has been widened to include the experimental certificate of extended education, but also with the City and Guilds of London Institute, the Royal Society of Arts, the Technician Education Council, the Business Education Council and other bodies which have direct and considerable experience of the design and administration of pre-vocational qualifications with a more practical slant.
This development will, I believe, have a profound influence upon the work done in the later years at school by the majority of our pupils and bring it closer to the real world outside the classroom. That is exactly what our junior adults need and what they deserve to get. This decisive step towards pre-vocational education for all is not a revolution; it is an evolution. It is a pity—is it not?—that those who form, for the time being at least, the principal party on the other side of the House cannot recognise as progress anything that is not revolutionary. But there it is. The mark of the Benn is upon them. We for our part must content ourselves with building soundly, though not in haste. It is the endurance of what we build, not the ephemeral criticisms of our style, that will prove the value of our work. It is a mark of a materialist philosophy that it measures the value of everything in terms of cash. But that is the yardstick which the party opposite continually uses in preference to all others, and I should like to draw their attention to the existence of other standards.
Before we move beyond secondary provision let me point out, for instance, that in England and Wales about 40,000 more young people stayed on in full-time education beyond the compulsory age in 1980–81 than stayed on in previous years. Yet in spite of that fact—which hardly amounts to a vote of no confidence in the system by the young people within it—we at present have in the maintained sector a better ratio of pupils to teacher than hitherto. Nor have we ever had such a close formal involvement of parents in the affairs of our schools. But even with this increase of the number of teachers proportionate to the number of children, even with the added parental interest and support which this Government have secured—and who

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would think from the way the Motion is termed and was moved that it was this Government that has secured them—even then, the system is still only as good as the teachers who staff it; and the technical quality of teachers depends upon the colleges and departments of education who select them and in which they are trained. I say the technical quality because that is what the colleges and departments of education impart. The supremely important qualities of personality, of dedication, of patience and sympathetic understanding are brought into the profession by the individual recruits themselves. Without them the most brilliant technical accomplishments will eventually fail when they are put to the test; and the standard of achievements in our schools I think makes a great testimony to the quality of our teachers.
It is just nine years since I was myself lecturing in a college of education, and I well remember the uncertainties and stresses that were thrown upon this sector of our educational system by the genesis of the James Report. The readjustments of the system that followed the report are only now complete. We do now have the right capacity to train the number of teachers complementary to the number of pupils that we can expect. It is, of course, always difficult to predict how that capacity will need to be adjusted for future years but the consideration of that is of course in hand with my right honourable friend's advisory committee.
But at this stage of our history, more than any other and in this subject as much as in any other, it no longer suffices to train a boy or a girl once in a lifetime; the curriculum changes—have I not just shown how we are changing it? Our economic prospects change—is not the party opposite hellbent on showing us how they change? The technical requirements of adult life change and, sometimes sadly and sometimes gladly, so do the immediate prospects of employment for our school-leavers.
That is why this Government continue to emphasise the importance of in-service training for teachers. A small but important part of that effort is directed at what I have always regarded as the central paradox of the teaching profession. I mean the paradox that results in the most gifted teachers being the most rapidly promoted and hence, inevitably it seems, the most swiftly taken out of the classroom and into an office to perform management tasks in which they may well have demonstrated, or even possess, no skill at all. Our in-service courses in educational management are a spirited attack upon the ills that can ensue in the management of schools though they do not, I fear, result in the return of all that teaching talent to the classroom where, in my view, it properly belongs.
I hope I have said enough to show your Lordships that this Government are concerned both to maintain standards at all levels of ability in the secondary sector and also to rationalise provision so that what is provided is effectively deployed. That is why we propose a single national qualification at 17-plus to replace a variety of competing pre-vocational qualifications. The principle extends also into the post-secondary sector. That is why we launched a programme of consultation on the funding and management of higher education outside the universities and why we expect to launch a short-term initiative in this area
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very soon. The contributions of individual institutions in this sector should for the first time be rationalised within a national system. They will then become complementary to one another throughout.
Another consultation recently completed touches another and vital aspect of the transition of our young people into adult life. That consultation was launched by the publication by the Manpower Services Commission of a consultative document called A New Training Initiative, which came out in May of this year. To this important aspect of our policy my noble friend Lord Trenchard will be speaking in greater detail, and I may say with greater authority than I can, at the end of this debate. He will also, I hope, have time to touch on our provision for retraining in mid-career. In that respect, at a time when it is often said that Government are blind to the needs of ethnic minorities, I will simply refer in passing to our expansion of the adult literacy unit. That is designed specifically to help those for whom English is a second language, and it will embrace numeracy and communication skills as well as the skills of reading and writing.
My noble friend Lord Trenchard will similarly bring his weight and experience to the very important question of industrial efficiency, which will form an important part of today's discussion. If we leave the training and industrial aspects of our remit to the end of the debate, let it not be for a moment supposed that we do not regard them as being of vital importance. It is simply that the Motion before us today proved, when eventually it was tabled, to cover a far wider sweep of subjects than could even be satisfactorily broached, let alone covered, in a single speech. My noble friend is a heavier gun than I am. It is fitting that he should cover this crucial field of fire. He will do so from behind an impressive breastwork of figures.
The Government current expenditure on support for industry's own training programme includes £70 million on the training for skills programme and £248 million on the training opportunities programme. Your Lordships should not, therefore, suppose that Government interest in a commitment to young people evaporates when they leave school. Nor can I emphasise too strongly our concern for those going through the disagreeable and frustrating experience of unemployment when they do leave school. Expenditure on the Youth Opportunities Programme at £413 million is evidence of that. Even now 13,000 young people are joining the scheme each week. Our eventual aim is to see that every person leaving school has three choices: to work, to undergo vocational training to the age of 18 or to move on to further education. That is in reply to the noble Baroness.
If further credentials are needed for our commitment to the 16 to 19 age group, let me remind your Lordships of the sum of £49.5 million which was added to the grant-related expenditure assessments of English local education authorities for 1982–83. This money is to be used to encourage voluntary staying-on at school, and it is, let me emphasise, additional to the provision which would otherwise have been made for education. The size of the extra grant that each authority actually receives will depend on how much it spends. But all local education authorities, with one exception, will receive some

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additional grant as a result of the addition to GRE. That exception is the Inner London Education Authority. ILEA may receive no grant at all under this head. But if that happens it will be because its expenditure is in excess of any reasonable level. It ought to be able to respond to the needs of the young unemployed without spending a single penny more in total, simply by reducing its excessive expenditure on other items.
The question of resources leads me naturally to our policy for the universities. How could it be otherwise? Let us look at this issue in context. I do not mean just the economic context. That provides the necessity for our present policies but it does not provide the scale on which we should measure them. In 1950, when I went to university, there were fewer than 80,000 students m all our universities put together. In the mid-60s, when the noble Lord, Lord Robbins, produced his fundamentally important report, there were just over 150,000 students in our universities. Since then, in a decade and a half, those numbers have increased by over 100,000. In the academic year 1980–81 there were 265,000 students in our universities. That is no mean increase. It is in fact an increase of rather more than 75 per cent.
Lord Davies of Leek: My Lords, will the noble Lord give way for a moment?
Lord Elton: My Lords, if the noble Lord wishes to challenge the figures, which I assure him are correct, I will give way. If he wishes to divert the debate, I will not.
Lord Davies of Leek: My Lords, I do not challenge the figures; I am just saying that they are the same as in 1926.
Lord Elton: Well, my Lords, in that case, we have taken a steep road not from a valley but from a plateau. It is in fact an increase of more than 75 per cent. since Lord Robbins's day. It is over 330 per cent. since mine, How long into the past that extended the noble Lord, Lord Davies of Leek, would know better than I. The prospect now, when we are exerting every possible measure to economise, is the reduction in home students over four years from 265,000 to to about 245,000; that is in fact a decrease of about 7½ per cent. Will the party opposite kindly note that it will leave us with at least as many students as we had in 1977–78 when they were in power, and quite possibly just a few more. Let us, therefore, indeed pay attention to the effects of Government policy on education.
The present enrolment of students aged 18 to 20 at universities in Great Britain is 7 per cent. of that age group. The planned contraction, to put this in a different perspective, is expected to reduce that by 0·7 per cent. to just under 6·5 per cent. This may be hard to take. It will certainly mean some quite painful adjustments. I do not belittle it. But when seen in context it hardly represents the end of the world. And noble Lords opposite would do well to remember that we shall still be spending over £1,000 million on universities this year through the UGC.
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This necessary contraction would, I think, be a very great deal less acceptable if an indiscriminate swipe had been taken at every university and faculty, reducing all by a common amount. But it is the very admirable achievement of the UGC to have seized upon this necessity as an opportunity, a much needed, and, dare I say it? a somewhat belated opportunity, to rationalise the provision we have and to concentrate it upon the areas most crucial to our national wellbeing and most able to provide the achievements we so desperately need. How odd it is to hear the party opposite, whose name was once synonomous with planning, decrying that process.
Once Government have determined the amount of cash available for universities, the UGC determines how it shall be distributed between them. That is not a Government responsibility, but I must say that it has been done with considerable care and vision. We are an industrial nation and the world industrial revolution shows every sign of leaving us behind if we do not take care. That is the context in which the committee's decisions must be seen. Engineering and technology are subjects crucial to our future. They arc taught at 42 universities, and for this purpose I have counted the Welsh colleges separately. Only two of the 42 were asked to reduce their numbers relative to 1979–80; 15 were asked specifically to increase them. The remaining 25 were expected to have the same numbers or perhaps a few extra. The number of students reading mathematics and the physical sciences was also expected to increase. So were the numbers engaged in business studies, and support is being given to developments in the biological sciences.
Certainly this shift of emphasis necessarily takes resources and numbers away from the arts. As a graduate in history, I regret this. But I recognise the need for it. There has even had to be, for the first time, a modest removal of the protection which clinical medicine has hitherto enjoyed. Even so, all medical schools are expected to be able to maintain their 1980 levels of intake, and that in fact means a further small increase in overall numbers on courses.
The whole theme of the attack of the party opposite upon mine rests on the need to spend more money. But to spend more money we have to have more money to spend. We cannot borrow it without putting further upward and unwanted pressure on interest rates. The interest on what we have borrowed is already staggering. They should know; they went to the bank for a lot of it themselves. If we cannot borrow it, we have to raise taxes on those who earn it. Our earning power does not depend upon historians and philosophers, I regret. There is a need for them; I am certain of it. But it is not the preponderant need of the moment. The preponderant, indeed the urgent, need of the moment is the need for just those disciplines that will under current plans be protected or expanded.
I have spoken of the context in which our policy on university funding should be seen. I referred to the historical context, but let us not forget the context of our contemporaries and our neighbours. At 1:9·3 our staff/student ratio compares favourably with even the richer countries of Europe. Our universities achieve higher success rates with shorter courses. In a word, we have, and we shall continue to have, one of the best university systems in the world. It will remain so, because of, and not in spite of, Government policies.

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I return to the point from which I started. The party opposite destroyed some of the best schools in this country. It did so in the teeth of our opposition. When the Act which perpetrated that fell deed was passed by this House their Secretary of State for Education was Mrs. Shirley Williams. That is a responsibility which few of us will lightly forget. Now even she has decided that enough is enough and has defected to join another troupe that is, I trust and fear, content with the damage that has already been done. It has its Members in this House also sitting appropriately, one might say, some way behind the socialists and rather less appropriately a little way above them. The remainder of the Labour Party it is that now has the temerity to accuse us of harming the interests of our country and our industry by our policies on education and training. Your Lordships must forgive us if we feel a little bit like Noah would feel if the captain of the "Titanic" was to come up to him in heaven and accuse him of hazarding his ship.
We have more students in our universities than ever they had. We have more teachers per child in our schools than ever they had. We have, as I have shown, a continuous programme of modernisation of our curriculum and training policies, beyond whatever they had. Had they stayed in power we could have moved a Motion with a vengeance. Not a request for papers but a full-blown vote of no confidence. But the boot, thank God! is on the other foot. They are having a hard time of it. They have lost office, they have lost friends—soon they will lose hope. They have moved for Papers—let them have their Papers. But never, never, let them or their one-time allies in the last disastrous Administration get one solitary finger of control on education, or training or industry again.
3.42 p.m.
Lord Rochester: My Lords, first I should like to thank the noble Baroness, Lady David, for introducing this debate. I do not intend to engage in the ping-pong match that has been going on between the Government and Opposition Front Benches. The subjects of education and industrial training are far too serious for that. But I do wish to speak on both of them as far as I can from personal experience. Perhaps I may introduce a lighter note into the debate for a moment. I must say that the remarks of the noble Lord, Lord Elton, about his noble friend Lord Trenchard, reminded me rather of the first lines of the old music-hall song, "That's my brother Silvest":
"He has got an arm like a leg and a punch that could sink a battleship".
In the field of education my remarks will be directed towards the effect of Government policies on higher education and particularly on universities. In that connection I should start by declaring an interest, although not a financial one, as pro-Chancellor of the University of Keele. I do not intend to take this opportunity to engage in special pleading on Keele's behalf, nor to advance the case that, at a time of economic stringency, universities in general should be exempt from reductions in public expenditure. What I do feel strongly is that the restructuring, redundancy and early retirement that will result from the severe
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reductions in grant and in student numbers announced last July for certain universities cannot take place in an orderly and cost-effective manner within the constraints of time and of money that the Government have imposed through the agency of the University Grants Committee.
I shall quote the case of Keele because it is an example known to me at first hand. Over a period of only three years, including 1981–82, cuts have been decreed for that university of 17 per cent. in students against a national average of 5 per cent., and of 33 per cent. in grant against a national average of 17 per cent. In the university founded by Lord Lindsay 30 years ago, reductions of this magnitude have understandably caused resentment when joint honours degree courses that are relevant to today's employment market, such as Russian with electronics or with economics, are thus put at risk. Threatened also are the aspirations to take such courses of many students now at school who are, in the celebrated words of the Robbins Report:
"qualified by ability and attainment to pursue them".
Keele staff and students are nevertheless responding in a constructive way. Two days ago I had the distasteful task of taking the chair at a meeting of the university council when the first painful decisions were taken. More will have to follow even if the Government modify their present policies in accordance with a statement made in the debate on higher education in another place on 18th November to which the noble Baroness, Lady David, has already referred. I quote from the speech of the Secretary of State in col. 307 of the Official Report where it says:
"It is said that we could go slower with less educational disturbance and the same savings. I am eager to be convinced, but the case rests on assumptions which are not necessarily valid. A slower approach might logically yield the same savings but the case has not been made".
As the noble Lord, Lord Elton, and indeed the noble Viscount, Lord Trenchard, know, the Vice-Chancellor of Keele University, to whose leadership I pay tribute—leadership under pressure—has provided the Under-Secretary of State with evidence earlier supplied to the University Grants Committee, which suggests that the financial cost to the nation might well be less if universities were allowed more time in which to effect the contraction that is now required of them.
The Keele evidence indicates shortfalls of income against expenditure totalling approximately £5,700,000 for the two-year period 1982–83 and 1983–84. It also shows that capital sums of about £7 million are likely to be needed if staff are reduced through voluntary means alone. Compulsory dismissals in face of successful claims in the courts for damages for breach of tenure agreements could, of course, lead to much higher sums than that.
At Keele there is no doubt that the overall cost to the system would be less if reductions in expenditure could be spread over the next four academic years instead of the two at present contemplated. So I should be grateful if, when the noble Viscount, Lord Trenchard, comes to reply to the debate, he could tell us whether the Secretary of State is now convinced of the validity of this and similar evidence that he will no doubt have received by now from other universities.

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The only other thing I have to say on this subject is that, to the extent that there has to be contraction, it is, in my view, essential on grounds both of logic and equity that means should be found as speedily as possible for universities and bodies such as polytechnics and colleges of higher and further education to be treated on the basis of comparable criteria. I say that as chairman of the governors of Chester College of Higher Education and in so doing welcome, as far as they go, the consultative documents, to which the noble Lord, Lord Elton, has already referred, that have been issued recently by the DES and by the Council of Local Education Authorities on the funding and management of higher education in England outside the universities and on the future of maintained higher and further education.
I turn now to the subject of industrial training. It is just four months since your Lordships passed the Employment and Training Bill. At the Report stage of that Bill, with support from all parts of the House, I moved an amendment which was designed to secure a generally acceptable solution to the problem caused by the Government wishing to see training placed on a voluntary footing wherever possible, and others among us preferring to build on the foundations already laid by existing industrial training boards. The suggestion then put forward was that all sectors of industry should have not necessarily a uniform training organisation, but training arrangements which could apply to statutory boards where they remained, or operate on a voluntary basis under conditions appropriate to the sector concerned.
Those arrangements needed to be capable of conforming to certain criteria which were so framed as to encourage an approach to training which was not simply structural but of an organic, problem-solving kind, that would focus on objectives and on achievements. Perhaps the most important feature of the means proposed to achieve those objectives was that they were aimed to ensure the maintenance of adequate local and cross-sectorial links, and thus recognised that training needs are related to the local labour market and apply across sectors, rather than being identifiable only on the basis of individual industries.
At that time, I expressed the view that such an overall statutory framework might well prove helpful, even essential, to the Secretary of State for Employment when the time came to implement A New Training Initiative sponsored by the Manpower Services Commission, to which, again, reference has already been made. The overall aim of that amendment was to seek a consensus so that in future, irrespective of the political complexion of the Government of the day, there could be continuity of policy in this vital area of industrial training. Alas!, although the principle involved had earlier been supported by a number of Conservative Members of another place, the Government were unwilling to accept it, and so we went our separate ways.
A few days after the Employment and Training Bill was passed the Manpower Services Commission recommended the continuation of statutory arrangements for a substantial part of seven sectors covered by existing industrial training boards. In doing so, the commission strongly recommended that in the sectors in which statutory boards were to be retained the
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Government should defer for at least three years the implementation of their decision to transfer to the industries concerned responsibility for funding the boards' operating costs. The Secretary of State has now announced his intention to retain seven training boards, broadly as proposed by the MSC. Those boards will, however, have to defray their operating costs from as soon as the beginning of next April. We, on these Benches, greatly regret that decision, which runs counter to the views expressed earlier by noble Lords in all parts of this House.
In the case of the remaining 16 sectors currently covered by training boards, the commission declined to make any firm recommendations for or against the retention of statutory arrangements until two conditions had been met. First, there needed to be clear evidence that proposals for alternative voluntary arrangements would have the capability to implement the objectives of A New Training Initiative. Secondly, enough detailed information had to be provided about such arrangements to form the basis for further consultations and to enable a reliable assessment to be made. However, before even making known the results of consultations on the New Training Initiative—and the noble Baroness, Lady David, had something to say about this—the Secretary of State has already announced his intention to abolish all the remaining training boards. My only consolation is that the Government have responded to the strong representations made by your Lordships, among others, concerning the operating costs of those boards that are to be dismantled, by agreeing to go on meeting those costs until the end of the financial year 1982–83, along with any net costs involved in winding up the boards.
This debate is timely in that it is taking place just before the Statement on A New Training Initiative that the Secretary of State has said he hopes to make before the Christmas Recess. Two of the three objectives of the proposed initiative concern young people. The first is to develop skill training, including apprenticeship, in such a way as to enable young people to acquire agreed standards of skill. The second aim, which has already been referred to by the noble Baroness, Lady David, is to move towards a position where all young people under the age of 18 can continue in full-time education, enter training or have a period of planned work experience combining work-related training and education.
We, on these Benches, heartily endorse those objectives. Indeed, I would go further in seeking to encourage education at the secondary stage to be related very much more closely to the world of work through not only increased co-operation between schools and industry, but also seeking to overcome the inbuilt prejudices of pupils by introducing into the school curriculum more problem-solving practical exercises of the kind which will later be experienced at work. On this point I acknowledge gladly what the noble Lord, Lord Elton, had to say on this subject in relation to the Government's thinking.
Next, I must remind your Lordships that at present many good employers, including the great company for which I used to work, simply cannot afford any longer to go on training apprentices beyond their own requirements in anything like the same numbers as previously. At current prices, it costs at least £25,000

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to train a single apprentice over a period of four years. The grants that such firms receive make only a tiny contribution to those costs. If training of this kind is to continue during and beyond the present recession, funding should surely come largely from some state source. I very much hope that the winding up of so many training boards and the withdrawal of support by the Government from those that are to remain will be seen as providing an opportunity for state aid, hitherto spread thinly over industry at large, now to be redirected to meet identified needs, making use particularly of company training schools, which are among the best in the land.
In my view, trade unions can best make their contribution by implementing with enthusiasm arrangements aimed at bringing our antiquated apprenticeship system up to date and accepting that young people undergoing training for skill should be paid, as in other countries like West Germany, a smaller proportion of the adult rate than is now the case.
The Government carry a heavy responsibility to ensure that standards of training in this country are not now allowed to deteriorate. In this they must take the lead, but in my view "industrial efficiency"—to use the words in the Motion—will be improved only if, in the field of training, the Government, Opposition parties, employers, trade unions and educationists are prepared to work together to achieve that objective. I fervently hope that we shall all prove willing to play our part.
3.58 p.m.
Lord Flowers: My Lords, from this Bench, I should like to congratulate the noble Baroness, Lady David, on having initiated this important debate. If I may say so, she is a staunch supporter of education at every level. However, like the noble Lord, Lord Rochester, I shall not follow the noble Lord, Lord Elton, because I do not want to indulge in a party ding-dong—we have no need for that.
We live in a technological world. We are increasingly part of a global society linked together by telecommunications, dependent upon the sharing of scarce resources, our population rising through the triumphs of medicine, our existence threatened by weapons of mass destruction. New opportunities, new dangers arise every day. They require a new level of understanding, not only on the part of the technologist—for we are not, and we do not wish to become a technocracy—but from everyone engaged in the democratic process.
As Dr. Paul Gray, president of the Massachussets Institute of Technology, said in London, on 12th November:
"Paradoxically, the same capacity for technological innovation which has inadvertently created many of our problems, now holds the only meaningful promise for solving them. Clearly we cannot retreat from the complexity of the modern world. Rather, our purpose must be to direct our energy and wisdom towards fuller understanding and still more responsible application of new and existing knowledge".
Technological change cannot co-exist with ignorance. A workforce unable to see the prospects for redeployment will not accept the need for automation. Many people reject the benefits of, let us say, nuclear energy because they do not understand the nature of the risks involved. Industrial innovation cannot come about
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unless investors understand something about the innovative process. Managers must understand men as well as machines, and so on. In short, the technological society has to be an educated society in order that there can be an intelligent consensus about technological developments. Wealth creation is no longer a matter of brawn, it presupposes education, which is therefore, as I see it, the most precious of all investments we can make.
We in this country, along with many others, are at present undergoing a massive transition from the steelmaking, shipbuilding, motorcar manufacturing—in general, heavy engineering—of the past to a future more dependent on information-rich and energy-conserving processes, the nature and consequences of which we can still only dimly see, and many already fear. One thing is plain, though: it is a transition to a more highly educated society. At such a moment we should be broadening the opportunities for education at every level—in the schools, in the universities and polytechnics, and in continuing education—devising and teaching the skills that a technological society needs, both to run itself and to understand itself. I was, therefore, glad to know that the Government seem to be considering some enhancement in the training opportunities for the 16-to 18-year olds, and I was glad also to hear what the noble Baroness had to say about this in the context of plans for the Labour Party. That is all very welcome, and very much overdue. It is also a pity that it had to take 3 million unemployed to bring it about. Elsewhere, however, the squeeze on education continues unabated.
Others have spoken, or will be speaking, about the other sectors of education. I want to say a few words about the universities, where the Treasury knife is cutting especially deep. I think I should declare that I do so as a vice-chairman of the Committee of Vice-Chancellors and Principals. The present Government policy, it has already been said, will reduce opportunities for young people to go to university by about one in seven over the next two or three years, when the demand for university admissions from well-qualified young people has never been higher.
The 18-year-old bulge occurs in 1983 and the population of university age will not drop back to its 1980 level until 1986. The Secretary of State appears to regard this reduction of opportunity with equanimity, despite the fact that it can only lead to a lengthening of the queue of unemployed young people. With social security benefits per head standing at well over £4,000 a year it would surely be cheaper as well as more socially desirable to educate them. It is therefore difficult to see what the cutback in student numbers has to do with the saving of public expenditure.
In financial terms the Government have imposed a cut averaging about 15 per cent. over the three years until 1983–84. This will indeed mean the dismissal of substantial numbers of university staff of all kinds, beginning in the very near future. The staff/student ratio will worsen and there will be a marked weakening of our national strength in basic research, so much of which is nowadays carried out in the universities. Perhaps that was not so much the case in Lord Elton's day, but it is so now.
As the noble Baroness has rightly said, there is still much confusion about how these high cuts have arisen.

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First, the University Grants Committee were required to make a volume cut of about 8 per cent. or 9 per cent. over the three-year period. In distributing their volume cuts they apparently exercised a certain degree of selectivity. But simultaneously the Government required the UGC to withdraw support for overseas students, and insisted that the universities charge high fees for those students instead. The fees to be charged were so high that in most universities the number of overseas students fell dramatically. They could get as good an education elsewhere in the world where fees were less, as in the United States, or even non-existent, as in France.
Those universities with large numbers of overseas students therefore suffered a further loss. In the case of my own institution, Imperial College—in which, of course, I have to declare an interest, even though I refer to it only by way of illustration—our total cut over the three years has been 17 per cent., of which only 4 per cent. was apparently imposed by the UGC as a volume cut, the rest being due to the withdrawal of support for overseas students. It is comforting to know that the UGC would only have wished a cut of 4 per cent.
In practice of course it makes no difference where the cut comes from. It is overall a 17 per cent. cut thanks to Government policies, which means that we are having to plan permanently to reduce our staff during the course of the next academic year by more than 200, only a fraction of whom could be expected to retire normally. That will involve us in substantial redundancy payments, the effect of which cannot be calculated until the Government have approved a scale of compensation for university redundancies.
My Lords, the Secretary of State, now supported by the noble Lord, Lord Elton, is trying to pretend that the degree of selectivity shown by the UGC has been so great that the burden of the cuts will be easily bearable almost everywhere. Some universities especially hard hit have added apparent weight to that misapprehension by emphasising their own plight. That is natural. But it is simply not the case. The scale of cuts is so great that only substantial numbers of actual closures of whole institutions could have provided the necessary degree of selectivity. The Government wanted a cut equal in financial terms to the closure of almost the whole of the University of London, or to the sum of the closures of Birmingham, Glasgow, Leeds, Liverpool and Manchester. If events of that magnitude are ruled out, as they clearly must be, the scope for selectivity is limited and everyone must suffer.
The prospect is especially grave for those of us heavily engaged in science and engineering. We work closely with industry and with Government departments to do research relevant to the industrial needs of the country. At Imperial College we spend about £15 million per annum on research, of which £10 million is earned in research grants and contracts. The remaining £5 million or so which comes out of the UGC block grant is what enables us to attract those external earnings—the dual support system, as it is called. It is now being heavily cut and our position is more precarious every day.
In response to the Finniston Report and to the direct call of industry many universities are trying to produce graduates better prepared for industrial
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employment, especially in engineering. At Imperial College we are working with 80 firms who share with us in genuine partnership the choice of students, the development of the syllabus and the selection and supervision of project work of industrial significance. It is gratifying that students of the highest quality are presenting themselves for our courses. Obviously it is expensive, both for industry and for ourselves, in staff time and resources. If we are to continue to develop these courses we have to do it within the dwindling resources now available to us, and with fewer staff. It is idle to suppose that standards will not suffer. Of course, many other universities are in a similar position to that which I have described at is applies to Imperial College.
If the Government are nevertheless intent on reducing the size of the universities, I, like the noble Lord, Lord Rochester, beg them at least to understand that they could achieve their effect less wastefully by extending the period of the rundown. That would reduce the high cost of compensation to dismissed staff, it would permit the maintenance of the intake of school-leavers during the years when their numbers will be at their highest and it would lessen the burden of social security benefits. I hope the Minister will comment on that proposition when he replies to the debate.
I should not like to give the impression that I am concerned only with the scientists and engineers, important though they are going to be. If we are ever to crawl out of the deep recession into which we have been driven, we must establish a creative, innovative climate in this country—a climate in which the need for change is understood by everyone and in which there is a new level of understanding. Our differences are not about the need for change, only about the mechanisms and the appropriate speed for bringing change about.
The time-scale for technological innovation and for public acceptance is long, typically 10 years. Investment for innovation requires sustained confidence on the part of all concerned—politicians, employers, investors, discerning customers, unions and, yes, educators too—and I submit that the present rate of rundown can create only instability and lack of confidence that our recovery can be anything more than a distant dream.
Lord Robbins: My Lords, may I ask the noble Lord to say, on behalf of the Committee of Vice-Chancellors, whether there exists a quantification of the savings which he alleges would take place if the period of rundown were prolonged?
Lord Flowers: My Lords, one is being prepared. It is a little difficult to do the sum when you do not know one of the elements in it, namely the rate of recompense for redundancy that the Government might agree to pay.
4.13 p.m.
Lord Stewart of Fulham: My Lords, at one stage in his speech the noble Lord, Lord Elton, criticised my noble friends for putting too much emphasis on the crude question of money in the education service and pointed out there were things in addition to the actual

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amount of money spent. Of course that is so, but I have heard Ministers say that for the last 50 years. It is the regular argument when they cannot spend money that is obviously needed if there is to be any real improvement.
The truth surely is that we could look round our education service, like every public service, and probably find that with a little more care here and there we could get a bit better value for money. But let us not kid ourselves that we should really solve the major problems of the education service in that way. If we are to meet the needs of the present time, that involves the spending of more money, and there is no dodging that.
We are also often reminded that, after all, the Government came to office at a time of great economic stringency and that we must cut our coat very carefully according to our cloth. The Government looked at the economic situation, in order presumably to consider what the priorities were, and they decided in their first budget that the first national priority was to come to the help of the richest people in the country by tax cuts which would increase their private incomes still more. The argument for that was that they would be so inspirited by it that enterprise would flourish and we should all be better off. We have all been waiting for that to happen ever since, and I dare say that in a year or two the same thing will be recited all over again.
The Government decided in the case of one public service, defence, that they could actually increase it—in my judgement, rightly. What I am saying is that they should also have regarded education as being in the same box, even if it meant not treating some of the wealthier taxpayers quite so kindly. It is a question of weighing up certain private advantages against the need of certain public services.
The Minister mentioned a number of improvements in the education service that we may look for—the gradual spread of computers from one school to the next, and so on—but if we look at something a little more mundane than that (at the minutes of education authorities throughout the country, considering the plans they have made and what they propose to do about them in view of what has happened to grants from the central Government to local authorities for their education services) we find that LEAs are saying gloomily things like, "We shall not be able to do much, if anything, for the nursery schools". That is a rather disquieting example because it is certain that one of the major advantages in life can be obtained by starting one's schooling or at least one's attitude to learning early. People who can afford it know that perfectly well.
The cutting and restriction of nursery school provision makes bigger the gap in education provision and quality of life between the richer and poorer sections of society, and the worry about the Government's educational policy is that it does that all the time. If we are really looking to the future productive power of this country, an increased division of that kind is surely the very last thing we want. We want to make it more and more possible for people to realise that, if they will pull their weight in the world, there is a
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chance of the kind of advantages that at present only a privileged few enjoy.
Then we find local authorities considering that they cannot do much, or that they may have to stop what they are doing, about maintenance grants for children who stay on after the statutory school-leaving age, and similarly with regard to clothing grants. Economies in that field will hit the children of the poorest parents, and once again it will be another wedge driven in between the kind of life and education that the luckier and the less lucky can expect.
We find local authorities deciding that, in view of the way the Government treat them, they will have to narrow the range of subjects in their schools. That again will put them at a greater disadvantage in comparison with the schools attended by the wealthiest section of the population. The growth of the public system of education has been, to a considerable extent, a growth in the range of subjects. Public education was conceived, first of all, as the three Rs, or rather the four Rs because they added on religion to the others so as to make the lower classes respectable compared with their betters. That is how it was thought of in the first instance. I am not suggesting that is the real purpose of religion—only how it was envisaged during a certain period in the 19th century. Gradually, the range of subjects was widened. There was a famous judgment at about the turn of the century that was followed by developments in the education system to enable the schools in the public domain to give a wider range of instruction. To start squeezing that back again now represents another wedge driven in between the education that some will have and others will have.
The Minister spoke, quite rightly, of the great value of in-service training for teachers, but he will find that is another subject that some local authorities are feeling they will have to drop in view of their present financial stringency. Again, there will be some schools—for example, those at which assisted places are provided and those attended by the children of the really wealthy—which will have a wide range of subjects, with well-qualified teachers, good teacher-pupil ratios and good buildings and equipment, and more and more at the other end schools where all those advantages are squeezed out. That is what I particularly object to about the Government's attitude to education.
It is illustrated in particular in their attitude to adult education, and I want to make special mention of adult education in inner London. As one would expect, the noble Lord spoke very sternly of the Inner London Education Authority. Well, let us be frank. What is really wrong with the Inner London Education Authority is that the citizens in inner London have had the bad taste to go on voting Labour for year after year. It is perfectly true that the ILEA spends a great deal of money. It has enormous needs, not really paralleled elsewhere in the country. There are problems of deprivation at home and problems concerned with a large number of children whose native language is not English, which adds much to the cost of providing them with a reasonable education. The Inner London Education Authority has all those problems in exceptional measure. It cannot be charged against it that it wastes money.
Lord Elton: My Lords, if the noble Lord would give way, I would say that the House should know that, when grant is calculated, ILEA's unit costs in schools for an average standard of service are assumed to be 27 per cent. higher than those of some shire counties. Next year, the allowance will go up to almost 35 per cent. But ILEA will still be spending far in excess even at that level. The point that the noble Lord is making is discounted, and ILEA is still overspending. Therefore there ought to be ample scope for savings for doing the things that he and I both want to see done.
Lord Stewart of Fulham: My Lords, what I am saying is that the factors are not discounted sufficiently. Let the noble Lord really examine the question of how much more it costs to educate a child if one has to start with the fact that it does not speak any English at all. That is only one of the problems that London has to face in exceptional measure. The noble Lord will find that London has to spend in the way that it does because it really needs to do so, and because to some extent, I admit, it deliberately sets itself to say—and this should make the noble Lord's heart beat faster—"We want to maintain a certain standard of excellence". If there has been a real standard of excellence in this country, it has been in the adult education service provided by inner London. An enormous advantage is that it has been one of our great instruments for dealing with problems of racial understanding, and that is one of the things that will suffer most severely from the way in which the Government are now treating local authorities in general and inner London in particular.
I want to pursue a little further the question of maintaining standards of excellence. The noble Lord stirred up a deep indignation for the direct grant schools. A direct grant school was simply one which received its dollop of public money directly from central Government, instead of from a local authority which had received a grant from central Government. There is not the slightest reason why that should make it a better school, nor in most cases did it. It was a device for providing a kind of subsidy to a certain number of middle-class families. That was what the direct grant system was about, and that, very roughly, is what one will find happens with the assisted places scheme; it will be a subsidy to a limited number of families. This is not of any conceivable use to the educational needs of a modern, industrial country. The Government must for all time get rid of the passionate desire to see that some groups of children are better provided for than are others. It illustrates the point that Professor Tawney made when he said:
"For some people it is not enough that their own children should get a good education. What they want to be sure of is that somebody else's child is getting a worse education".
Lord Elton: My Lords, I apologise for intervening twice, but I think that that is a most uncharitable and snide attack on what has been done. The function of a direct grant grammar school was in fact to enable children with ability to go to a school of excellence when otherwise they could not afford to do so, and that is what the assisted places scheme is for. As a result of the scheme, a third of the children pay nothing
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towards the fees. While we are on the subject of money, I should like to mention that I said earlier that ILEA was rated at 27 per cent. above some of the shire counties because of its disadvantages. The overspending even above that is currently 49 per cent., and is of an order of magnitude which cannot indicate efficiency.
Lord Stewart of Fulham: My Lords, on the second point I say again that the noble Lord has not sufficiently studied the cost of surmounting the difficulties that London has to face. On the other point, I am quite prepared to admit that a number of children individually can benefit from having an assisted place as compared with children who do not. Similarly, children can benefit from going to a direct grant school as compared with those who do not go to such a school.
What I am saying is that the public money expended in those ways could have been better expended on improving the general system of state education that was open to all children. This constant talk about excellence is an excuse for giving a particular favour to particular groups. We see it in the latest Manchester decision. What the people of Manchester wanted, what the facts of the situation obviously pointed to, was that in regard to falling rolls—the question of size of sixth forms—the problem should be solved by the device of the sixth form college, rather than by trying to have a limited number of different sixth forms in different schools. Against the wishes of the inhabitants, against the evidence of common sense, the Minister has rejected that, and he is going to create a situation in which some schools will be regarded as exceptionally good and will have sixth forms, while others will not. This is the first step on the road back to grammar schools on the one side and secondary moderns on the other.
Therefore, I say, that there are two things wrong with the Government's approach to education. First, they do not rate it sufficiently highly in priorities when it comes to national expenditure and the use of national resources. Secondly, instead of looking at the needs of a modern industrial state, they are still playing about with their ideas about what they call excellence, but which others will simply call deliberate class privilege.
4.27 p.m.
Lord Vaizey: My Lords, I should like to thank the noble Baroness, Lady David, for putting down the Motion today, though it is in rather general terms, and so it was difficult to know exactly what would be the focus of the debate. I should like to explain that if the debate continues for a long time, I may have to leave before the end because of a prior engagement. I cannot follow the noble Lord, Lord Stewart of Fulham, a hundred per cent. down the way about the ILEA. I speak as someone who was educated, to the age of 19, by the old London County Council, which in essence is what the ILEA now is. I must honestly say that I think that the ILEA has gone downhill, and I should not be in the least surprised if the ILEA followed the example of Islington Borough Council in going over to the Social Democrats before we are very much older.
I do not want to follow some of the noble Lords who have spoken in the debate on a party political

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course, because I want to make some points which I think will be shared by a number of people on all sides of the House. The first point I want to make is that since 1945, since the end of the war, education provision in the industrialised countries (the OECD countries) has grown in volume between 8 and 12 times. That is to say that the growth in the amount spent at constant money prices has been gigantic. The growth of education has been one of the phenomena of the 30-odd years since the end of the last war.
The motives of that growth were twofold. First, there was the fact that after the war the age groups of young people increased fairly dramatically in all the industrialised countries. Secondly, the rate of economic growth was exceptionally high. As growth took place in the economy, the surplus that was generated each year went largely into the service sector, and education formed a large part of that sector.
During that time of growth not only was there an increase in provision—that is to say, more and more people were brought into the education system—but the actual quality of provision increased beyond people's wildest imagination. The pupil/teacher ratio throughout Europe and North America improved steadily during the period of growth, in particular in the United Kingdom. For example, in the United Kingdom, the number of non-teaching adults working in schools in addition to teachers is now roughly half, having started in 1945 with one person in 10 in the education system not being a teacher. That shows the increase in the back-up force which each teacher had, and each teacher had a smaller class as well. That is to say, the unit cost of each item of educational provision really went up quite extraordinarily fast (as I am sure the noble Lord, Lord Robbins, will agree) during those 30-odd years.
The problem is a different one at the moment because we are now talking, not only in the United Kingdom but throughout Europe and throughout North America, about what to do about education in a period of decline—decline in two senses. First, the age group has diminished, and diminished dramatically. By the early 1990s the size of the 18-year-old age bracket will have fallen by about one-third. Instead of thinking of the age bracket as about 900,000 boys and girls, it will be 600,000. Secondly, of course, since the turbulent events of the 1970s, the rate of economic growth throughout the West has declined and, indeed, gone into reverse.
What is interesting is that despite the cries about cut-backs—cut-backs by Mr. Callaghan's Government, cut-backs by Mrs. Thatcher's Government—the pupil/teacher ratio in the maintained schools is still improving. The latest evidence shows quite conclusively that at the last count the pupil/teacher ratio in the maintained schools, both primary and secondary, is still improving. Why, therefore, are people complaining about a shortage of resources in the maintained sector? I said in a debate that we had about a year ago—I do not remember exactly when it was—that I conclude that because the pupil/teacher ratio is still improving the authorities are choosing, perhaps under the pressure of the teachers' unions, to spend more on teachers and less on other things. That is their choice. But I would respectfully submit that
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in a time of stringency you cannot have both things at once. If you want more non-teaching expenditure, then you will have to cut down the amount you spend on teachers and you will have to slow down the rate of improvement in the pupil/teacher ratio.
I would emphasise that I think this is a non-party point, not only because it applies to all the OECD countries for which we have evidence, but also because so far no party—whether the Social Democrats, the Labour Party or the Liberal Party—has said that it would actually spend more on education than is now being spent. I think the argument ought to be about how to spend the diminishing total in an area where demand is actually falling.
I believe that, on the whole, the way that higher education is being treated at the moment is not wholly consonant with the practice of good government. But I would not regard that necessarily as an attack on the present Secretary of State, because this is something that I have been saying since the late Lord Boyle's time at the Department of Education and Science; and certainly I said it frequently—both in private and in public as well—when my friend Tony Crosland was Secretary of State for Education. The most disastrous single decision in higher education since the war was the late Mr Crosland's decision to create the binary system. The consequence of that was, first of all, to create a class structure in higher education, where the universities were inevitably driven into a position which seemed like privilege and the polytechnics into seeking to ape that privilege; and, secondly, it was inherently wasteful.
When I was a member of the Inner London Education Authority's education committee we were debating setting up a student health service, student residences, libraries for all our polytechnics—duplicating all the provision made in London by the great federal University of London. What an incredible waste of public money! That waste of public money might perhaps be countenanced during a period of rapid economic growth—rapid economic growth for the United Kingdom, that is—but to allow it to continue during a period of decline is absolute madness.
I am very pleased indeed to see that at long last we are to have a non-University Grants Committee committee for the non-university sector. But I must ask, first of all: Why maintain the University Grants Committee in its present form, when the obvious need over the contraction is to manage the resources efficiently? Secondly, why is the University Grants Committee conducting this latest exercise in total secrecy? Are we trying to keep these actions from the Russians? We are not much use there, judging by the secrets that the Russians have obtained; so I can only conclude that they are trying to keep it from the people. Heaven knows why they are trying to keep it from the people. Does it really matter if we know that they have said that so-and-so's biology department is better or worse than somebody else's biology department?
I really do think that if this is not an area where open Government can be practised there cannot be any area where open Government can be practised. In the debate in the other place on this matter the eulogies poured on the UGC were really unbelievable, literally unbelievable, because the UGC, as we all know, is not all that bright a body. It is brighter, perhaps, than the

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Department of Education and Science, but it is a not all that bright a body, and its decisions are presumably made on pretty arbitrary grounds.
Over the next 10 or 12 years the higher education system will probably contract by about one-third—perhaps a little less than one-third. How much more sensible it would be now to say to some institutions—University College, Imperial College, King's College, the University of Birmingham, the University of Manchester—"You will be safeguarded, broadly speaking, until the 'nineties", and to say to other institutions, "No; over the next 10 years we do not really think there is much of a future for you". Then people could actually make plans. At the moment, we are all double-guessing the University Grants Committee, and the University Grants Committee are double-guessing the Department of Education and Science, and no sensible plans are being made at all by any institution or by the state system as a whole about how the contraction is most efficiently to be managed.
So I would argue quite candidly that the role of these committees as buffers between the institutions and the department has long ceased to be a role that it is worth playing. I really think it is time that there was active public discussion about how to manage the contraction. Having said that, I think it is inevitable that there will be a substantial further contraction of the higher education system whichever Government are in office.
I agreed with Lady David in some of her submissions about skills. The provisions of skill training in the United Kingdom has been a scandal for a century or more. Some of Matthew Arnold's more trenchant comments were directed to a scandal of this kind in Queen Victoria's reign, and exactly the same kind of criticism can be made about the position that prevails under our present Queen.
What one has to ask is: Why has this scandal persisted under Governments of quite different complexions? It survived Mr. Asquith, the first Alliance Prime Minister; it survived Mr. Attlee and Mr. Wilson; it survived Mr. Heath; and it survives down to the present day. Why has this system (or lack of system) prevailed? I cannot help feeling that, whatever reasons one might give for this chronic problem, the solution cannot lie within the present institutional framework. The present institutional framework is incapable of making these intitiatives, because there is a battle between the Department of Education and Science, on one side, representing the local education authorities, and the Department of Employment, on the other side, representing the employers and trade unions. Up until now, over a century, the twain have never met. All they have done is to throw ripe tomatoes at each other (like the University of Sussex students threw at one of the many leaders of the Social Democratic Party) saying, "it is your fault, not my fault". So that kind of quarrel goes on the whole time, and generation after generation of young people grows up without the skills which they would acquire if they were young Germans or young French people, young Americans or young Canadians.
I cannot help feeling that we need a major political initiative to guarantee that the great majority of young people, by 1985 or 1986, will go on to the labour market equipped with some kind of skill. I ask
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myself: How is that political initiative to come about? I cannot help feeling that the present institutional framework is wholly inadequate for it. During the war, when the United Kingdom needed aeroplanes, we created a Minister of Aircraft Production and Lord Beaverbrook occupied that post. I claim that the shortage of skills is just the same now. There is just as acute a shortage of skills now as the shortage of aeroplanes was in the early years of the Second World War.
I cannot help feeling that we need a Minister of Skills who takes over all the post-16 provision of the Department of Education and Science—not the greatest glory in the crown of the Department of Education and Science—and takes over the training section of the Department of Employment and the Manpower Services Commission—not the greatest glory of the Department of Employment (if, indeed, that dismal department has any glories). If we could find a powerful and effective member of this Cabinet or of any successor Cabinet who could put some effort, some real commitment, so that every person in the 16-plus age group would be provided with a marketable skill, we should have done more to put the economy and the educational system of this country right than has been done since the time of Matthew Arnold.
I have, to some degree, not been the most loyal Back-Bench colleague of my noble friend Lord Elton, who made a fighting speech, but I hope that I have been constructive. I have tried to approach the problem almost sub specie aeternitas since the problem has gone on such a long time; and I have tried to put it in an international and longer context more than in the party battle. It is a national crisis and it demands a bold and imaginative solution, and I see about me far too little of that kind of thinking now.
4.40 p.m.
Lord Alexander of Potterhill: My Lords, I begin by making an apoiogy. My name appeared yesterday on the list of speakers as being one who was to take part in that day's debate, but it was due to a misunderstanding between me and the Whips' office for which I apologise. I did not intend to speak yesterday but I did intend to speak today. I begin by saying that I wish no part of the party political give and take which opened this debate. I make only one comment. In my experience the introduction of party politics relating to the education service has done more damage to the education service than any other single factor in the last 20 years. I wish that we could get rid of it and face the fact that the problems now facing us are beyond party politics; they are fundamental to the life of the nation.
I begin 50 years ago when we were in a similar situation to that existing at present, in a deep depression. At that time young people were leaving school and could not get a job. At that time, in order that they could receive unemployment benefit, they were required to attend for one day a week at what was called a junior instruction centre. I took charge of a junior instruction centre at Greenock at that time. I studied the records of those boys who had left school at 14. They were quite good, perfectly reasonable records. But when they had been unemployed for a year, and, in many cases, for two years, they were not unemployed;

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they were unemployable. They were ineducable. They were ruined, not temporarily but for life. I prayed then that I should not live to see that situation again. My Lords, that is happening now.
I want to confine what I have to say to the 16 to 19 year-old age group. All the factors relevant seem to me to point in one direction and to lead to a policy decision which I am certain is inevitable in the long term. What I see are decisions being made not on a strategic basis but on a purely tactical basis in the short term. Let us look at the employment problem. Is there any doubt that in a highly, rapidly developing technological society we shall be able to maintain a standard of production adequate to our needs with a reduced labour force? In a word, we must alter the employment pattern of our people. This is the reaction.
We have three things we can do. We can reduce the age of retirement—which creates two problems, a major problem in pensions and a major problem for the education service in helping those who retire early to know how to enjoy their retirement. We can shorten the working week, which gives us more or less the same problem. Or we can delay the entry of young people into employment. Of these, the third is the obvious choice. It is something that was learned in the United States a long time ago and is being learned very rapidly—as the noble Lord, Lord Vaizey, has pointed out—in Europe, in Germany, Sweden and France. Really, we are so far behind. This would create a situation in which, instead of the danger of a generation of young people being almost unemployable through lack of effective training, we would equip them as a labour force to take advantage of the opportunities which occur when the recession passes.
Let me now turn to the education side of the problem. It is a long time since some of us recognised that it was not going to be possible to maintain sixth forms in all schools. I remember writing a book on the subject about 12 years ago. I was delighted when the Permanent Secretary in the Department of Education and Science quite recently said to me that they were beginning to think about it. The fact that the great majority of our children attend comprehensive schools is part of the problem. It makes it more difficult to maintain sixth forms in every school. The fact of falling rolls aggravates that problem and makes it more difficult. The latest suggestion from the Department of Education and Science is that in that situation one of the schools could carry a sixth form and the other schools could let their sixth form pupils go there, as the noble Lord, Lord Stewart, mentioned. What will happen in that situation? All the parents who hope that their children will stay on in the sixth form will apply for admission to the school that has the sixth form. There will be too many applications, more than there are places. Therefore, a process of selection will be inevitable. We shall have a great step forward and create one grammar school and three or four secondary modern schools—a major advance to where we were 10 years ago!
The second solution is that we had better have a sixth form college. The sixth form college suffers from a number of very serious defects. We are all talking about the need for the curriculum to have a greater
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vocational content. The sixth form college runs under school regulations. It is required therefore to recruit only teachers who have qualified teacher status. This means that it is unable to recruit people with experience of industry and commerce who can bring to that stage of education the realities of industry and commercial experience.
It suffers from a second fault. It perpetuates the separation of the academics from those who are studying technical or commercial subjects which are likely to lead into the wealth-creating sector of the community. This, to me, is a bad thing. It also means that the over-esteem in which academic values have been held in this country will be sustained and probably sharpened. I am bound to say that the over-esteem of academic values—or, perhaps, the under-esteem of other values in technology or commerce—has been one of the worst features of our educational system for a good many years. When I combine these factors—and remember that the unemployment of 16 year-olds is not transient, it is permanent—I come to what seems to me an obvious and simple conclusion which is quite different from the conclusion reached by the Secretary of State for Education and Science.
What we need is a new structure: schools to 16 and the establishment of tertiary colleges from 16 to 19 which offer the full range of opportunities: courses to A level with a wide choice of subjects; courses leading to technical or business qualifications; sandwich courses which combine study with practical training. The other extreme is where the educational content may be only 20 per cent. or 25 per cent. of the total course—but for all. If you like, in the beginning we may reasonably make it a requirement—as it was 50 years ago—for those who were unemployed to attend. My own view is that it will be compulsory for all of them of necessity within four or five years. This is almost certain to happen.
What are we offering instead of that opportunity? The Youth Opportunities Programme, short-term training for specific jobs, most of which will not exist in five years' time, with three out of four not getting a job anyhow and going back onto the unemployment register. This is not an answer. The answer is surely full-time education and training to 18 so that they can enter the labour market equipped for the kind of industrial and commercial life which they will experience in a rapidly developing technological society—the point that the noble Lord, Lord Flowers, made so excellently a little while ago. Surely that is the right answer. As to cost, we are having rapidly falling school roles. Educational buildings are going to be available as never before in the next two, three or four years. My Lords, I would plead with the Government to examine the problem really carefully—not in the short term but in the long term—to provide our young people with the opportunity which they deserve to make their full contribution in the future as they have done so often in the past.
4.54 p.m.
Baroness Jeger: My Lords, I thank the noble Baroness, Lady David, who has made it possible for us to have this debate today. I am especially glad to follow the noble Lord, Lord Alexander of Potter-hill, who talked such good sense to us. I am a little

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ashamed that he has painted on a very wide canvas while I want to restrict my remarks to some narrower concerns. I am also very unnerved to see in his place the noble Lord Lord, Redcliffe-Maud, who was master of Birkbeck College many years ago when I was a student. It is very intimidating for a student to see one's former master sitting in this House. I recall, as I am sure many thousands of students do, the wit, wisdom and encouragement that he brought to Birbeck College in the dark and difficult days of the war.
I want to refer to some of the problems of Birkbeck College, which I am sure your Lordships do not need reminding is a college of the University of London which awards internal degrees to students, 90 per cent. of whom are in full-time employment. It is a very special type of night school and we worked very hard there. It is not easy to be a part-time student, attending after a full day's work, to be engaged in full time degree study and, in most cases, trying to take the degree in the same time scale as full-time students enjoy.
They might be described as part-time students, but there was nothing partial in the degrees. I never felt very part-time myself because what was the difference between working from five at night to 10 at night as against other students who worked from 10 in the morning to five in the evening? There are serious differences, not of academic standards or of demands made on students in these circumstances but in the way such students are treated.
Part-time students, studying for an internal degree, are contributing to the gross national product by their work. They pay their own fees out of taxed income. There is no relief from income tax. All sorts of people can claim expenses: journalists, doctors, solicitors and even Members of your Lordships' House. But for the part-time students spending out of their own taxed income on fees, books and meals out—occasionally I had to have a bar of chocolate in the evening—there is no help. There is no help from any student concessionary travel, and this means that there has to be a high degree of motivation, which certainly exists.
There are no mandatory grants for part-time students—even those who are doing, as I have emphasised, the equivalent of a full-time university course. We found that about 70 per cent. of the students at Birkbeck received no help at all with their fees; others had some assistance from employers who realised what a good bargain it was to have someone working for them who would then be so idiotic as to spend the rest of the night studying, working and bring that extra knowledge to contribute to the firm or undertaking involved.
This is an important aspect because we are excluding from any financial assistance many people who have a great deal to contribute and who, if only they had gone straight from school to university, would have been entitled to such assistance. The noble Lord, Lord Elton, said that my party seemed to be only interested in spending more and more money. I want to ask on this narrow point whether we could not think for a little while about how we spend the money that is available. We should not continue what seems to me to be an injustice to a very large and growing number of students in this country.
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Here I will show how broadminded and fairminded I am. I cannot think why successive Governments have discriminated against the part-time university student. Forgive me for talking about Birkbeck but it is the one college that I know a little about; I know what I am saying applies in many other places. Birkbeck does not provide normally for school-leavers; many of the students come late in life. There are all sorts of reasons for this. Often, as in my case, family finances make it impossible to go straight from school to university. Sometimes it is lack of opportunity; and sometimes—and this may be the very best of reasons—academic interest and motivation was awakened later in life. The country wastes an unaccountable amount of talent, and therefore a contribution to the nation's wealth and well-being, if we do not widen the opportunities for people who do not go straight from school to college.
I know successive Governments have paid lip service to this idea and there are many students who are taking advantage of getting into universities later in life; but those who have to continue with their job, who cannot see the possibility of perhaps bringing up a family on a student grant, even if they can get one, and so continue to earn their own living and to study at night, really do need some encouragement. Some are taking degrees that will help them in their professions. There are many older teachers who previously just had the two-year training college experience, who by taking degree courses—and goodness knows that is hard work after teaching all day—in the evening think that they will gain further opportunities.
There are many scientific workers at Birkbeck, and 21 per cent. of the students come from central and local government staff. I would suggest that central and local government are getting trained students on the cheap this way. It is certainly a contribution which is made to the staffing of those authorities. How are these people being affected by the Government policies which arc the subject of this debate? Like everyone else—we are all suffering from inflation and its impact on everyday things—many of these students have family responsibilities but now the hardship they are facing, deliberately imposed by the Government, is the increase in fees. Here, I am referring to fees which I repeat are not paid by local authorities but paid out of their own taxed income and for which there are no mandatory grants at all.
Hitherto there has been no fall in demand by people wanting to carry on this extraordinary life of part-time university study as well as doing a job. But now, speaking as a governor of Birkbeck, there are serious difficulties for many of them in continuing their courses. Certainly we are very apprehensive about the future of the college. Fees for courses for first degrees have gone up from £97 a year to £160, and for postgraduate courses from £142 to £250 a year—and any of your Lordships who are better at arithmetic than I am will know what that means when I say it is out of taxed income. It represents a very serious inroad into the earnings of many of these people, and some of the students, particularly those with family responsibilities, have talked to us about the impossibility of carrying on. I should be glad if I thought the Government would pay some attention to this subject, and particularly to the question of making mandatory grants

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available to people who are doing what is in effect a full-time university course.
Now I want to come for a moment to something the noble Lord, Lord Alexander, said in a reference to unemployment, which I thought was very sensible. The last time we did a survey at Birkbeck, 2 per cent. of our students were unemployed. Sadly, that number is going up all the time. The only result can be that, in becoming unemployed and having time on his hands, the student has to cease to be a student because he has not got the money to pay his fees. There was a very interesting letter from the Bursar of Birkbeck in The Times on 9th November, in which he called attention to that point and also suggested that it would he a good idea for unemployed people—those who wanted it and had the ability—to be enabled to go to colleges such as Birkbeck or to others elsewhere, with their fees paid. They would not then, especially if they were at evening classes, fall out with those who say they must be available for work, because they would be studying in the evening.
I am told by the Manpower Services Commission that it costs £4,300 to finance each unemployed person. Why not spend that amount on some of these people in enabling them to study and perhaps fit themselves for new jobs, or at least enrich their lives? I am sure there are many under-used university premises up and down the country—under-used in the evening—which could be put to good use by some intensive and imaginative work. We all want to see more continuing education and it seems to me quite unacceptable that we should have students at a place like Birkbeck who, perhaps halfway through their studies and through no fault of their own, become unemployed and then because they cannot find the fees, also have their studies interrupted. They are clobbered in every direction. That is a reality and I would not be putting this to your Lordships and taking up your time if I did not know that that is what many of our students are facing.
I just want to add one point that also touches on what the noble Lord, Lord Alexander, said. Obviously, in the changing pattern of society and the new demands that are made on the workforce, it is absolutely essential, if we are ever to deal with unemployment sensibly, that we should recognise that there will be, during the working life of almost every one of us and certainly during the lives of the younger generation, the need to study something fresh. We are getting out of the situation in which one went to college and learned something and then stayed in that discipline for the rest of one's life. If we are to make it possible for people who are in the older industries and need to learn new skills and new disciplines, then they must be encouraged to do so at any age. Certainly if they are prepared to do it part-time, then I think the country is benefiting very economically from those people.
So I do hope that whatever the other results of the Government's policies are—and I apologise for having dealt with just this one point—they will try to see that the effect does not fall on those who are working hardest, self-motivated. I should have thought these self-help students would have commended themselves to the philosophy of the Conservative Party—a noble group of people who are pulling on their own boot-
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straps for their further education and, I am sure, for the enrichment of the community.
5.8 p.m.
Lord Bowden: My Lords, I am happy that we have this opportunity, thanks to the noble Baroness, to discuss this subject this evening. I want to take a rather unfamiliar line and I want to begin by saying—I am sure I can say it with great confidence—that this country has never yet in its history taken education seriously or done as much for its young people as most of the countries in Europe.
During the 18th and 19th centuries this was the wealthiest country in the world, and it was so at a time when it was the most illiterate in Europe. We were able to create the Industrial Revolution, and it was made by people who never went near a university at all. The only education which was provided, for example, in the art of dyeing and the technology of textiles was in places like the institution over which I presided for 25 years in Manchester, which did it all by local initiative and was able to create a very dramatically successful series of departments, but which never received, until fairly recently, the credit I have always thought it deserved.
I arrived in Manchester at just about the time when the Government uncorked the cornucopia, and very shortly after I left, the Government stuck the bung right back in. I was there at a time of expansion such as there had never been before and will probably never be again. The reason why the Government decided to do something was very simple. After the war, it became obvious that our own industries were never going to be able to compete with those of the Continent, because we had never provided educational facilities to rival those which Europe had devised and instituted, in order to make it possible for European industry to rival that of this country.
The Germans, for example, established a whole series of what they called technical universities or Technische Hochschulen, and the French had their system of Grandes Ecoles. The Germans and the French led the way. The Swedes, the Swiss and the Dutch followed their example, and established technical universities of great distinction to educate people whom we did not have in this country at all. For very many years, we had to rely on continental engineers to come from the continent to Lancashire, where opportunities existed, and to establish the great industries, some of which, such as, for example, the Renold Chain organisation and many others, survive to this day on the basis of the genius of Lancashire business men and engineers, and the skill of men who had been educated in places such as Switzerland and Germany. This is the very remarkable background to the whole educational problem of this country.
In 1953, it had become obvious that something had to be done, and steps were taken to make it possible for engineering education to grow. It did grow. By 1956, we were spending as much money on our universities as we were spending on the egg subsidy. We were spending as much money on the Department of Scientific and Industrial Research as we were on the Egg Marketing Board, to get rid of the eggs produced by the egg subsidy, which was already costing more than the universities.

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Thereafter, in about 1963–64, the growth had become quite dramatic. I myself studied it and came to the conclusion that there were two things about it which were fundamentally wrong. The first was that we were increasing expenditure on universities by an amount far greater than could be sustained in the long term, by comparison with the very much smaller rate of growth of the domestic product. I wrote a paper on this subject, which was widely circulated and published, and I said that the number of scientists in the world had grown by 12 per cent. every year since the time of Sir Isaac Newton. Were that growth to continue for another couple of hundred years, every human being in the world, and every dark horse and cow as well, would be a scientist.
The cost of educating each scientist was increasing by 4 or 5 per cent. per annum, so the total cost of science was increasing by about 17 per cent. per annum, which meant that it doubled in every four years or so. The gross domestic product at the time was growing at the rate of 4 or 5 per cent.—happy days they were then—but, still, the disparity was so great that it was quite inconceivable that this enormously rapid growth could be sustained into the indefinite future.
What was to be done? I went to Germany, I went to Russia and I went to America to discuss the situation there. I discovered that in America they felt that 15 or 16 per cent. was a number they were used to; that God had obviously intended it and they were going to stick with it. I tried in Russia. Their view was that men who valued their survival in Russia did not talk about things like that or they ended up in Siberia. I discussed the problem of fitting the graduates from universities to the demands of industry in Russia with Mr. Rudnev, who was in charge of Russian education at the time. He said to me: "We have a most elaborate system for estimating the number of engineers that we are going to need, and the specialities that they ought to have, and we also have a very complicated system for fitting our universities to provide them. We always get the answer wrong. You have no system at all. You always get the answer wrong. The question I want to discuss with you is: which of us does worse? It is impossible to say."
The point I am making is that university growth in those days was rapid and almost uncontrolled, and the point of my reasoning was this. There are two fundamental things about a university which determine its survival. One is its size, but the second is the rate at which it is changing. I concluded that you cannot expand a university system in a country at more than 6 or 7 per cent. per annum, because, if you do, you cannot produce the staff you need to develop it, and I said that the rate of growth is as important to a university system as its absolute size.
We, at this moment, are in the process of doing two things. We are dramatically changing the rate of growth and we are dramatically changing the absolute size, and the combination of those two changes is more than any university system anywhere can survive. The structure of a university the size of its research schools and the prospects for its new staff, depend profoundly on its expectation of further growth. The opportunities which will be available are all dependent on the rate of growth, as well as on the absolute size,
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and I concluded 20 years ago that the rate of growth cannot exceed 7 per cent. per annum, and cannot change by more than about 20 or 30 per cent. per annum, without causing grave harm to the university system.
We have been forced into accepting the proposition which was enunciated on the continent years ago, that if you are to build up an industry you need qualified engineers. We have been forced into accepting the proposition that engineering schools shall be expanding. In the 1890s the largest school of electrical engineering in the world, in which English was used as the medium of instruction, was in Tokyo. They used English as a medium of instruction, because the textbooks were in English. But they had the largest school of electrical engineering in Tokyo in the 1890s, on the general ground that that was the only way of producing an industry which would rival the industries of the West. They have always continued with this proposition, as have most of the countries of Europe. We started out very bravely, but abandoned the idea before we completed it.
The harm which the Government's policy can do, both in the long term and in the short term, is really awe-inspiring. We were, as I said, the most prosperous country in the world, while Lancashire was the most illiterate place in Europe. The number of men who signed their marriage lines with a cross in the 1850s was nearly half the population. But we cannot do it again. It is not sufficient to have an illiterate population to become rich. I have often thought that successive Governments have never grasped this point. The requirements of great skill became obvious towards the end of the last century, and have now become dominant. No industry can survive without large numbers of highly skilled men, and highly skilled men can come only from properly organised university schools, while university schools can succeed only if they are not only fairly big but their rate of change in size is controllable.
The catastrophe which faces the universities of Aston, Bradford and Salford, to say nothing of the not so spectacular but very serious troubles which my own institution now faces, are likely to do infinite harm, to destroy traditions which have been built up successfully over the years and to deprive this country of men whose services can be of enormous importance and can help to raise the standards of living of all of us. We have said many times that it is a tragedy for young people to be deprived of the opportunity of education. Of course it is. Equally it is a tragedy if industry is deprived of the opportunity to engage men who can help it to survive and to thrive. We are apt to forget the one in our anxiety to emphasise the other.
Our universities are at grave risk at this moment. It does no good to say that they are not doing too badly and that if a few are cut seriously it is perhaps in the long-term interests of all of them. People never realise not only how important the universities are as institutions but what an enormously important social function a university can supply: that it provides opportunities for the community as a whole to unite; that it provides opportunities for people to get together and develop new ideas; that it provides also a major part of the industry of many cities. For example, the University of St. Andrews does as much for the locality as the steelworks at Corby did for the district of Corby.

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The loss of that university would be devastating. It is not of course going to disappear, but it is going to be cut back. The same applies to Salford, Bradford, Aston and Manchester. I am sure that it applies to other places, too. We cannot afford to allow this sort of thing to happen in the long-term interests, and even the short-term interests, of the community.
It is notoriously true to say that any country can thrive for a short time if it totally neglects what used to be called preventive maintenance—if, in other words, it allows its buildings to fall down and, furthermore, if it eats the seed corn. These are short-term measures to become prosperous but they are not the kind of thing that any country responsibly can do if it has any sense at all of its obligations to its successors.
In the 19th century we had fewer universities in proportion to our population than any other country in Europe except Turkey. A professorial chair, like a bishopric, was often nothing more nor less than a sinecure. A university professor was not expected to do anything. We survived with Oxford and Cambridge in that state because Lancashire managed without them. We are not talking these days about a university system detached totally from industry. We are talking about a university system which has become an integral part of industry. To destroy it is to destroy some of the capital, the long-term interests and the future of the industry upon which we all have to depend.
This is a very difficult question. I know that the universities could not go on expanding at the rate at which they were expanding. I myself wrote a paper about this for the Treasury about 20 years ago, but I never for one moment thought that the Government would take the idea sufficiently seriously to cut back suddenly. Rather I felt that the rate of growth would have to be decreased in a sensible, leisurely and appropriate manner. You cannot spend millions of pounds, as we have done, on the universities I have mentioned, particularly since all of them are concerned to educate men who want to go directly into industry, and then destroy them or cut them back to half their size (which will destroy them) without at the same time doing infinite harm to the economy of the country as a whole.
Since I believe that it is so important to make changes in universities at a reasonable rate, I hope the Government will look favourably on the proposition which has been put forward by the vice-chancellors, that the changes which have to be made will be made in a manner which the universities can cope with. These are very weighty and very serious matters, far too difficult for me to handle quickly, but I do beg noble Lords to believe that though many of the difficulties have been long foreseen the solutions are as bad as could have been contrived.
5.25 p.m.
Lord Winstanley: My Lords, I always listen to the noble Lord, Lord Bowden, with great interest and great enjoyment. After what he told us about those interesting happenings all those years ago at the School of Engineering in Tokyo I am beginning to wonder whether we shall discover that we finally turn the economic corner when we find out that in UMIST, the University of Manchester institute of Science and
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Technology, of which the noble Lord, Lord Bowden, was such a distinguished principal, they have, at long last, started to teach engineering in Japanese.
I have listened to the nine previous speeches very closely—important speeches in an important debate for which we are all deeply indebted to the noble Baroness, Lady David. The nine speeches to which I have listened seem to me to have dealt fairly thoroughly with all the main points with which I am particularly concerned. Therefore, there is no point in my repeating arguments which have already been put and which, frankly, have not yet been countered or even defended. I agree with everything which has been said in those nine speeches, with the possible exception of the speech of the noble Lord, Lord Elton, who seemed to me to read his ministerial brief so extremely rapidly that it was not until after he had sat down that I realised that he had not actually said anything.
I have listened during the last few days to two defences of the present Government's policies and their actions with regard to universities. First, I listened to the speech of the noble Lord, Lord Elton, which appeared to defend those policies merely by attacking the old historical policies of previous Labour governments. Then I listened on Sunday to a lengthy interview on, I think, BBC Radio Four—the lunchtime news—with the Secretary of State, Sir Keith Joseph. I do not honestly think that I have ever heard so hesitant and defensive a response from a Government Minister regarding new policies, for which it appeared that all he could do was to offer excuses and expressions of regret and apparently to imply that as a result of the remorseless pressure of economic events he had been reluctantly required in acquiesce to measures which, he appeared readily to agree, were very damaging indeed to our education as a whole and perhaps to our industrial prospects.
The noble Lord, Lord Elton, referred, among other things, to the present, in which he acknowledged that there would be cuts in numbers of students of 7 or 8 per cent. But he went on to say that at least we had an opportunity to concentrate resources upon institutions and colleges whose work is most closely related to our needs. On Salford, Aston and Bradford, as the noble Lord, Lord Bowden, has said, these cuts appear to be falling most heavily—universities which are dedicated to the production of professional workers to work in the new and rapidly developing science-based industries upon which our whole future is going to depend. How the noble Lord, Lord Elton, can describe the matter in those terms I cannot understand.
The noble Lord, Lord Flowers, was wholly right to remind us of the dramatic changes that are going to take place in the very nature of work in the future—changes which will certainly come about and which are already coming about. As he rightly pointed out, in the future—and indeed now—we shall need new and different skills and knowledge. But I am bound to say, and I think that the noble Lord, Lord Flowers, would agree with me, that we need those new forms of knowledge and that new skill not only for productivity and for industry but also, in the new world upon which we are on the brink, for leisure.
I am certainly convinced that in the coming years we shall have to provide an increasing number of opportunities for the constructive use of leisure in ways which

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are not consumptive of resources which are in short supply and which are not destructive of a fragile environment. Leisure of that kind can only come from a broadly based and continuing education—an education continuing, as the noble Lord, Lord Alexander of Potterhill, so rightly said, through those vital years of 16 to 19. It is at that time that we have an opportunity to educate our youth to spend the enforced leisure which they now so tragically have in profitable and fulfilling ways which are not damaging to society.
The noble Lord, Lord Stewart of Fulham, who speaks with such immense personal experience on this particular subject. rightly focused our attention on the earliest years of education and he referred to the need for education authorities to narrow the range of subjects taught and studied. That point which the noble Lord made leads me to the two points which I wish to make and which have not previously been made in this debate. Those are largely the reasons for which I put my name down to speak. because I was convinced that the kind of things about which I feel very deeply concerning what the Government arc now doing would be dealt with effectively by others.
Referring to the earlier years of education, something has come to my attention with regard to the selection of students for colleges of further education and higher education. teachers' training colleges, students applying for places to study for their post-graduate certificate of education or perhaps a diploma in education, or even in universities for a bachelor of education. There is a lady whose name I will not give because I do not yet have her permission, but I will pass the correspondence to the Minister in due course. She has sent me a letter which has been written by the tutor for admissions into a particular college of higher education to an applicant—a lady—and the letter says this:
"Since you were invited to interview for the PGCE course we have been advised by the Department of Education and Science, not to accept graduates in subjects which are not directly relevant to the primary school curriculum. Your interview was satisfactory, and in other circumstances we would have offered you a place. As the position now stands we very much regret that we are unable to do so".
This particular lady, who is. I think, 27 years of age, already has a degree which she took at the Open University in general studies and now has an honours degree in social sciences. When I made further inquiries about this circular letter, or instruction, which appears to have gone out from the Department of Education and Science to the colleges of higher education and to teachers' training colleges with advice to say "do not accept for training graduates whose subjects of study are not directly relevant to the primary school curriculum", I found that on the outlawed list appeared to be things like politics, economics, social studies and educational psychology. I have heard of a case of a lady with a doctorate in educational psychology who is regarded as unsuitable to be a primary school teacher. It really seems to me to be an odd kind of discrimination, and I wonder perhaps whether at the end of the debate the noble Lord might be able to throw a little light on this matter.
It is one thing for the Government to say to the colleges of higher education or teachers' training colleges that they must make certain cuts in their total intake. Whether or not it is right for the Government
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to say that is another matter. I do not actually think that it happens to be right. To say that is one thing, but having said that they must make certain cuts, surely the people to decide which particular students to accept are the authorities in the college, not the officials within the Department of Education and Science. I should be interested to hear on what this curious circular is based. It is said that they must not accept graduates in subjects which are not directly relevant to the primary school curriculum. What is relevant to the primary school curriculum?
I wonder how many of your Lordships remember seeing that delightful film "Kes", when the little boy comes home from school, at which he had been at a choir practice and had then been doing a bit of pottery. He was asked what he had done at school and he replied, "Muck and singing". We do not only want handicrafts and reading and writing and arithmetic in primary schools, and if mature graduates, who have studied disciplines which may he far-ranging, wish to enter colleges in order to be teachers in primary schools, we should welcome people of that calibre and not erect obstacles in order to make it impossible for them to get in
That leads me to the only other paint that I wish to make in this debate. I said that we should leave the selection of these pupils and these students to the authorities in the particular colleges, and, referring once again to the speech made by the noble Lord, Lord Stewart of Fulham, he spoke of our obsession—if it is an obsession—with the pursuit and maintenance of excellence. I wonder sometimes whether, in the field of university education, at times we do not have a little too much excellence. I am a little uneasy about a situation in which an increasingly large number of young people will be chasing an increasingly diminishing number of university places. Immediately that happens the universities are in the very difficult situation of having to make a selection from a very large number of students, and inevitably we have the tendency for that selection to be made entirely on the basis of high academic success in a narrow range of subjects. It may be that it is the only way, hut I just wonder whether success at A-level is necessarily the best possible indicator of who will ultimately achieve a very good degree or who ultimately perhaps will make a very good use of that degree.
Perhaps I may now turn a little more to the professions and away from the kind of scientific disciplines which we have been discussing earlier. In medicine now, there are so many people seeking places that in order to get one you more or less have to decide that you want to be a doctor when you are about 14 and then it is for your school to make sure that you get a place when you are 17 or 18; you do nothing but biology and chemistry and physics for about five years. You then arrive at the medical school knowing all about the cranial nerves of the dog fish and the transverse section of a bryony stem and practically nothing else. Sometimes I doubt whether at the end of the day all these people make very good doctors.
I freely accept that medicine and dentistry and other professions need their quota of extremely able and talented people. They need some brilliant people to pioneer new frontiers and break new ground, but what the professions need far more than those people are

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people who care, people who are prepared to give time, people who are concerned about the job and who are concerned about other people. Should I ever be ill—and I might be, who knows?—I do not want to be treated and looked after by a terribly clever doctor. I just want to be looked after by a doctor who thinks it matters and who is prepared to listen.
I have made this point very seriously, because I think moving into an era in which competition for places for higher education will become keener and keener, we really do have to think about whether we want to make absolutely sure that the only people who get into certain professions happen to be people of extreme academic brilliance, because I believe that in all professions and all occupations there is room for some people who are not as brilliant as all that. They can make an immense contribution, provided they have the graduate and post-graduate training and they can often make very satisfactory use of that training. I feel that the kind of steps which the Government are taking will narrow down that choice and perhaps tend to concentrate more and more in that kind of way, so that our selection of candidates for positions of immense importance in society in various occupations and professions will be narrowed down in a way which in the end will not be very good for us.
Finally, I agree wholly with the noble Lord, Lord Bowden, who implored the Government to think again and try to follow the advice of the vice-chancellors and perhaps phase this out in a more manageable way. If the Government turn to me and say, "What about the cost? It is all very well for the Liberals to talk about spending more money on education, and so on"—all I can say to the Government spokesman on that is that I am not awfully inclined to listen to the advice of people in the Government who now find it necessary to spend £12,000 million a year paying people for doing nothing, while everywhere we look there are things waiting and needing to be done. On this matter, I really do believe that the Government should think again.
5.40 p.m.
Lord Hatch of Lusby: My Lords, I feel a little disappointed, with no disrespect to the Front Bench speakers opposite—that the Leader of the House is not participating in this debate, because on a number of things that I want to say I have argued with her over a number of years, without getting any satisfactory answers. But this does give me an opportunity —despite his absence, which I understand—of tackling yet again the noble Viscount, Lord Trenchard, as in the days when he was concerned with industry, and again we have had many arguments, none of which I feel have been satisfactorily answered. Fortunately, my noble friend Lord Bowden, and the noble Lord, Lord Winstanley, following him, have said a number of things that I intended to say in this connection, and that therefore makes it unnecessary for me to say them.
I would like to tackle the noble Viscount quite directly on his previous role in industry, in connection with the Government's present policy so far as education is concerned. Quite frankly, it seems to me, to bowdlerise an old saying, that those who would
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destroy British culture are first made mad. Let me take the Government's own standards, their own values and their own policies. How is it possible for that Government to single out universities, which have already been mentioned several times this afternoon, but cannot be mentioned too often, like Salford, Aston, Bradford—where I must declare an interest as an honorary Fellow—and one could go on further than that to Scotland, to Heriot-Watt, to Stirling—how is it that these universities that above all have been providing the skilled personnel for the rejuvenation of our industrial and commercial life are specially singled out for the reductions in expenditure which the notorious letter of the UGC put forward. It is no good the Government saying, "It is not our business; it is the business of the UGC". It is the business of both but the UGC would not have sent that letter if they had not first been commanded by the Government to cut their expenditure. And, what is more, I think, so far as the UGC is concerned, we would be having a much more informed debate this afternoon and there would be a much more knowledgeable debate in the country if the UGC believed in open Government and if it published the criteria on which it is basing its allocation of the cuts in expenditure.
What we have heard from the Government, what we heard from the noble Lord, Lord Elton, this afternoon, in the speech which he read, and what we heard from his right honourable friend the Secretary of State in another place, was a constant reiteration of, "Who will pay? Are not the universities in the market place? Where is the extra money coming from? This is a burden upon the taxpayer". This was reiterated and reiterated by Government spokesmen, although I think there is a certain ambiguity; and I noticed this in the speech of the noble Lord, Lord Elton, this afternoon; he did not seem to be quite sure whether the Government are making these cuts because they are necessary or because they are beneficial, and he seemed to fall between those two. But let us take the general burden of the Government's policy, that they are necessary, irrespective of whether they are advisable or not. As my noble friend Lord Bowden has once again pointed out, the failure of the British industrial system and the British trading system which we have suffered from during the 20th century began in the 19th century, when we were overtaken by the Germans and by the Americans, both of whom were teaching engineering and technology while we were still content with Latin and Greek. Is it a coincidence that the economic recovery since the Second World War in both West Germany and Eastern Germany has been closely associated with the continuation of their technical educational system and the direct link between their further education and their higher education, while we have been very largely stagnating, despite the expansion of numbers and of expenditure?
We on this side of the House are by no means alone in making this suggestion. It was at the least moderate, if not conservative, Committee of Vice-Chancellors and Principals that wrote:
"We are in comparison with our industrial competitors a sadly under-educated and under-trained country".
It was the same body which also wrote:
"Ministers have failed…"—

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notice the word "Ministers"—
"… to understand the extent and the depth of the damage which is being clone to our universities".
I really do think that the Government spokesman should answer these points, and particularly answer them in view of his experience in the Department of Industry. Is he going on, as the noble Lord, Lord Elton, has done, and as his right honourable friend in another place has done, to suggest that the money that is spent on higher education is a burden on the taxpayer? Is it not an investment in industrial recovery? Is it not also an investment in future technology? How can that happen when the very universities that have specialised in these branches of present and future essentials for our country's prosperity are those which have been particularly picked out for reductions?
And added to the vice-chancellors and principals there have been, as the Minister must know, many representatives of business, of commerce, of industry, who have pointed out the short-sightedness of cutting down in the sections of the university world that are specially designed for what the Government are continually promising us, and have been promising us for so long without any sign of fulfilling their promise, an industrial recovery. Could I just quote to the Minister, who no doubt is taking notes for his colleague, the league table in Europe, as provided by UNESCO, the league table which shows that higher education of 18 year-olds in Sweden stands at 44·2 per cent., in the Netherlands at over 30 per cent. and in the United Kingdom, at the bottom of the table, stands at only 19·8 per cent. That is the burden of what I have to say regarding the Government's deliberate policy of cutting what has been called the human seed corn of the future of this country.
However, I want to broaden out the debate for a minute or two into a wider area and perhaps, again, I should declare an interest. This time last week I was teaching and conducting research 5,000 miles away in the University of Zambia. Next week at this time I shall be teaching in the United States. I have had experience in lecturing in universities throughout this country, Scotland the West Indies, the United States and also, importantly, in certain communist countries, in Yugoslavia and in Guinea—an interesting and valuable experience. So that is the interest which I declare in relating the policy of the Government so far as education is concerned now, to the place of our country intellectually and, indeed, emotionally, too, in the outside world. Again, I am sorry that the noble Baroness the Leader of the House is not here because I asked her some weeks ago why the HMI who traditionally have been in charge of international affairs had been taken off that job and not replaced. The noble Baroness did not know and I am still waiting to know.
The policy of the Government so far as the cuts that we have been talking about today are concerned must also be linked with the policy of the Government towards overseas students. What the Government have called the full-cost fees for overseas students have a direct bearing on the relationship between the British people and people in the overseas territories, and the universities in Britain and the universities in
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the overseas territories, but particularly the universities in the Commonwealth.
One now finds very sadly that universities in this country and institutions of higher education in this country have gone into the market-place. They are trying to sell their places in the internatonal market in order to compensate them for the losses they have sustained because of the Government's policy in raising the fees of overseas students. I wish to come back to that matter in a moment. However, these fees are now the highest in the world. What sense does it make in Britain that we have to take students from the French-speaking West Indian Islands, for instance, as though they were home students, but students from the English-speaking West Indian islands have to pay full fees? I really do not understand the logic of that. It means that, in fact, the high fees which we are charging now, and which our universities are bound to charge now because of the Government's policy, are being applied to the students from the poorest countries in the world.
The universities will tell you—they will not say that this is an exact figure—that there has been a fall of about 35 per cent. in the number of applicatons from overseas students to British universities; whereas, according to The Times Higher Educational Supplement, there is a flood of applicatons to the United States. Why?—I shall tell your Lordships. The reason is that, according to calculations, the average course in a private university in the United States costs about 3,000 dollars. In a public university, a state university, it costs about 2,000 dollars. In this country it now costs between £2,000 and £5,000. So obviously the students have got to go where they can afford.
Do we want to repel students from this country? Do we want to repel them for the sake of our own students? Do we want to repel them on the basis of our contribution to a more socially just world? Let me remind the Minister that it is not just to the United States that these students go. Scholarships are constantly being offered from Eastern Europe. If they are offered from Eastern Europe as an alternative to the fees that they have to pay here, then some of those students must go to Eastern Europe whether they want to or not. They have just no financial option.
Now, on top of the reduction in the attraction of overseas students to our universities in this country who have so enriched our universities and who have been so enriched by our universities, we are getting an attack on our universities themselves—on their structures, their functions, their numbers and their staffs. What will this do? What am I, personally, going to tell my students and my fellow faculty members in the University of Zambia? When I have post-graduate students to send abroad for training what shall I tell them? T shall tell your Lordships some of the things they must be told. I have already mentioned the fees for overseas students.
But I have also got to tell the administration that one of the effects of the Government cuts in British universities is that they will destroy our traditional method of tenure. That will go. We have not heard from the Government in either House as to what the cost will be in redundancy pay, hut we do know that if, as anticipated, a considerable number—I shall not put a figure on it—of the present staff of the universities

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are dismissed, they will have to be paid redundancy pay and every calculation that I have seen suggests that that redundancy pay will cost a great deal more than the savings that are being made by the present Government expenditure cuts. What I shall have to tell my colleagues is that because of the loss of tenure in this country fewer members of British university faculties will be able to risk going abroad. They will be unable to take that risk for the sake of their families because they will fear that if they go abroad their positions will be filled by somebody else while they are abroad and when they come back they will find themselves redundant.
And that must be added to the cuts which I mentioned in the Question that I put to the Government yesterday —the cuts in the supplements paid by the British Government yesterday—the cuts in the supplements paid by the British Government to academics serving overseas, the drastic cuts in my own university from 75 to 30. Seventy-five British academics did have the best supplement, but that number will be reduced to 30. What will happen? Some of them will have to have their contracts broken; others will not have contracts renewed; and other posts will go empty. They must be filled. From where will they be filled? We must look to other countries which will pay the supplement that will make family life possible when these people are serving overseas. That gap must be filled. Surely the Minister can see that all of this is drastically reducing British influence in countries overseas, particularly in Third World countries, in the developing countries. It is also reducing the chances of our links, our traditional links that have come from the British educational system, in international trade, in commerce and in understanding. At the same time it will deprive British students of that experience which they receive and which enriches their lives through living with and among students from overseas.
Finally, it seems to me on both the counts that I have mentioned—both on the economic attack on the universities in Britain today and on the economic attack on the connection between British universities and overseas universities—that the Government have virtually admitted that they believe in an elitist concept of higher education. They have discarded the Robbins principle. They have replaced that Robbins principle with a philosophy which was well put by the noble Lord's right honourable friend the Secretary of State, when he said sometime ago:
"When young people are taken away from their home milieu in late adolescence, crowded together in age groups with diminished parental and, indeed, adult influence and without the social disciplines which the need to earn a living imposes, is it surprising that their late adolescence rebelliousness should feed on itself and seek ideological rationalisation?"
Coming from an old Harrovian, that makes ironic reading, but it seems to sum up a good deal of the Government's thinking on higher education.
It was the Washington Post which used an appropriate headline for the President of the United States when it described him as a "Nineteenth Century fossil". It seems to me that those in charge of the Government's present educational policy are aptly described by the same phrase. They are going back to the 19th century when higher education was considered to be the right of the rich and the privilege of a handful—a tiny
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handful—of the poor. I would anticipate that the present Government's policy, as it has been enunciated, will shortly he followed by an attack on student grants which, remember, attacks the poor, attacks the children of the poor and, what is more, also attacks sex equality, because it is usually the girls of the poor who are deprived of higher education if there is a choice.
The policy that has been enunciated by the right honourable gentleman in another place, the policy that has been enunciated this afternoon, fits straight into this mould of 19th century élitism; just as it does overseas where it is not the common natives whom you educate. If you do educate those from the Colonies and the overseas territories, then you go for the princes. The universities today are having to go for the princes because it is only the princes who can afford the fees that this Government are charging.
6.4 p.m.
Lord Kilmarnock: My Lords, I like other noble Lords, am most grateful to the noble Baroness, Lady David. for affording us this opportunity of debating these important matters. Her Motion is so wide-ranging that one could jump in at almost any point in the whole spectrum of education and training. This afternoon I shall resist taking up in any detail the question of provision for 16 to 19 year-olds for three reasons. First, it is still a matter of speculation what the Government will pull out of the hat in response to the Manpower Services Commission's consultative document, A New Training Initiative. The Guardian this morning talks of a £900 million package, but I think that it will be more fruitful to wait and see exactly what the Government propose and to debate it thoroughly at that time. Secondly, the subject is under active study by my party's education policy group, and I would not wish to pre-empt their conclusions. Thirdly, and lastly, the claim on public attention and funds for this group is way out ahead of the field in this particular race and needs, I think, no further generalised advocacy at the present, particularly after the very powerful speech of the noble Lord, Lord Alexander of Potterhill, with which I so much agreed.
The last point leads me into what I want to talk about. It is no doubt highly desirable that the Youth Opportunities Programme schemes introduced as temporary counter-cyclical measures for the young should struggle out of their emergency chrysalis into something more substantial and permanent. It is something that the public will very likely approve, if not applaud, after Toxteth. In many people's minds vandalism and delinquency are closely connected with unemployment or with poor employment prospects, and who is to say that they are wrong?
However, of course, the danger is that out of panic we shall introduce further imbalance into our whole education and training system, which is already so heavily weighted towards initial, at the expense of post-initial, education. It is my earnest submission that we need both in proper balance. The French, who order some things at least rather better than us, have developed the practice of alternance, which means in essence alternating periods of work and training throughout working life. The details of this scheme are set out in Appendix I to Sir Monty Finniston's report on the engineering profession, referred to by the

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noble Lord, Lord Flowers. I recommend it to the attention of all those who arc interested. In passing, it was this report, of course, which came out so roundly, in Chapter 2, paragraph 24, in favour of:
"a massive programme planned to educate and retrain employees of all ages and all levels if human skills and support required to implement and sustain new technologies are to match the demand for them".
Allowance is only one aspect of the wider concept of éducation permanente, and its industrial extension, formation continue, which I am convinced we shall have to adopt in this country if we are to keep up with technology, keep up with the times and keep up with the rest of the world.
On the training side we are really not doing very well. If we are to stay in the international trade league at all, structural changes in industry are inevitable and will continue to eliminate existing jobs. We hope, of course, that this will create demand for workers in jobs of a different kind. But this will call for rapid retraining to match rapid market changes and here, of course, initial and post-initial education and training join hands. The cumulative effect of under-training school-leavers presents, and will increasingly present, an urgent problem of adult training and retraining. It is inevitable that some people make wrong choices in their first employment. It is necessary to make provision for mature people who wish to make or, indeed, have to make, a fresh start to improve their prospects by retraining.
What do the Government plan to do about this now that they have abolished, I think, 16 of the industrial training boards? What do they plan to do about TOPs courses? Will they expand them and open them also to people who are not unemployed, or, perhaps I should say, not yet unemployed? In The Times today an appropriate paragraph leapt to my eye:
"…opportunities for retraining and further training should be opened up for adults of whatever age, particularly those made redundant, through the expansion of skills centres, in-house courses, and the Open Tech courses.
What the Germans, French and Swiss and others have shown is that only government action can achieve such objectives".
I think that, in fact, the noble Lord, Lord Elton, showed some recognition of this. The Times goes on:
"It does not have to do the training itself. It can, if it prefers. impose an inescapable legal requirement on the employer, refunding at least part of the cost, and it can stimulate new initiatives through, say, regionally-based bodies. But act it must".
Act it must, my Lords.
I think that the noble Lord, Lord Elton, promised us something on retraining in middle and later life from the noble Lord's heavyweight companion, the noble Viscount, Lord Trenchard, and I hope that the noble Viscount when he replies will have something of substance to tell us on this.
The second prong of éducation permanente is less directly connected with the labour market, but none the less important. In the United Kingdom this whole area of education, which is only vaguely provided for in the 1944 Act, leads a precarious existence under the generic title "adult and continuing education". The noble Baroness, Lady David, made a reference to it, and so did some other noble Lords. Its watchdog is the Advisory Council on Adult and Continuing Education, set up in 1977 for three years,
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and reprieved for a further three years by the present Government. The classic work on the subject is the Russell Report, which came out in 1973. More recently it has been taken up by the Alexander Report, and the report of the Open University's Committee on Continuing Education, which came out in 1976, and urged the then Government to fulfil their undertaking to the ILO Convention on paid educational leave.
In Towards Continuing Education, published in 1979, the ACACE suggested on page 9, paragraph 18, that continuing education should include the vocational training that is carried out within industry and under the Employment Acts as well as that provided under the Education Acts. I must say that I feel this should be followed up, for there is no doubt that the spheres of the Departments of Education and Science and of Employment are increasingly overlapping or rubbing up against one another, and a more unified approach seems highly desirable. The ACACE went on to argue the absurdity of the "front-end" or "front-loading" model of education whose impossible aim was to issue students with all the necessary educational supplies to cope with another 50 years of adulthood. And in view of what the noble Lord, Lord Flowers, has said about the society of the future and its requirements, how increasingly absurd this is.
It cannot at present be contested that the funds available for education are almost exclusively tilted towards "initial education" from the age of five to anything between 16 and 25 (a massive dose to which many of the young are showing increasing resistance). According to the Russell Report at page 246, table 28, in 1968–69 there were only 1,261 full-time teaching staff employed in adult education in the United Kingdom, with a further 433 principals with some degree of responsibility for it.
The number of adult learners then involved was estimated at something over 2 million, of whom the LEAs catered for some 1.7 million. The net expenditure on adult education was approximately £16 million; that is, or that was, 1.1 per cent. of the LEAs' net expenditure on all services. Under present pressures LEAs tend either to cut down their provision or charge fees which increasingly restrict access to the relatively well-to-do. The Central Policy Review Staff in their report on education and training, published, I think, two years ago, pointed out that most LEAs have separate institutions for adult and for further education; "a distinction which serves little purpose". They recommended that the two should be integrated and that DES funds at present available only for university extension courses and full-time "liberal studies" courses at adult colleges be opened to LEAs for wider adult education purposes.
In your Lordships' House debates on education tend to come down rather heavily on the universities' side, perhaps because of the distinguished membership we have from universities. In the last debate on "higher and further" I seem to remember that "further" was almost entirely swamped by "higher", so I do not want to say very much about the universities, but I will turn to them briefly in the particular context of what I am saying—not, of course, without some trepidation with my distinguished colleague Lord Flowers sitting beside me.

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The report of a one-day conference sponsored by the Committee of Vice-Chancellors and Principals in May 1980 repays reading. In 1978–79 some 400,000 adults attended courses (some very short, others lasting several years) put on by university departments of extramural studies, adult education, extension, and the like. Although the total number catered for was well in excess of the undergraduate and postgraduate population, the financial commitment of the universities to continuing education came to a mere 1 per cent. of their budget.
To the uninitiated, the layman, "falling rolls" and large-scale expensive redundancies of academic staff might seem to reinforce the case for extending the universities' "extramural" activities at a time when potential demand for them seems likely to rise. But according to the Central Policy Review Staff this contraction of their conventional clientele has encouraged them to lower their criteria of entry for this group rather than attempt to attract mature or part-time students—those students the noble Baroness, Lady Jeger, was talking about, and telling us of all the difficulties they suffered.
The Central Policy Review Staff sees this as not only discriminatory in a way that is hard to justify but harmful to other educational establishments whose traditional clientele is being "poached". Now this is the CPRS view, and the noble Lord, Lord Flowers, may tell me that it is not strictly true; but, if it is, it is hard to fault the universities on this score if they receive no central funding whatsoever for their mature or part-time population and if the individual members of that mature and part-time population receive no grants, or very few grants, to enable them to carry on with their studies. This was another point which was touched on by the noble Baroness, Lady Jeger.
There would therefore seem to me to be a strong case for action to correct this form of discrimination against the "post-initial education". The universities themselves recognise, in the words of Professor Steel (then Chairman of their Council for Adult Education) that
"economically, socially and educationally there is a job to be done on behalf of a much wider spectrum of society than we have cared for hitherto".
The Russell Report is now eight years old and things have changed, if anything, for the worse. Since Russell the meagre 1 per cent. of the total education budget then allocated to adult education has actually fallen to a mere 0·5 per cent. On these grounds I feel strongly that the Secretary of State should call on the Advisory Council on Adult and Continuing Education for a fresh and comprehensive report prior to the expiry of their present mandate in 1983, and that the terms of reference should not be restricted, as in Russell, to "the provision of non-vocational adult education" but should embrace the whole field of post-initial education. I hope that the noble Viscount, when he comes to reply—perhaps the noble Lord, Lord Elton, will pass this suggestion on to him—will be able to tell us what the Government's intentions are in this important but scandalously neglected field. I should further like to ask him whether he is prepared to consider my suggestion.
6.19 p.m.
Baroness Platt of Writtle: My Lords, I first of all should like to thank the noble Baroness, Lady David, for establishing the subject this afternoon, and to apologise to her for not being here to hear her speak or indeed to hear the beginning of my noble friend Lord Elton's speech, but in Essex we were conferring with the CBI with the idea of encouraging small business into our county, and indeed talking about the CBI helping us to provide employment for young people and jobs, which is one of the important parts of our policy. I am sorry that my noble friend Lord Vaizey is not here to hear that certainly education and industry, local government and industry, do meet. This is not a surprise.
Essex took an early initiative under the last Government, which has increased with this Government. In terms of the Youth Opportunities Programme, we have always co-operated with the Manpower Services Commission. We now have 3,780 placements, and we were pleased today to be able to thank the CBI for 2,500 places for work experience on employers' premises.
We have a wide variety of opportunities. Naturally, they include life and social skills, which include interview techniques and letters of application for jobs, for it is important for young people to understand what will appeal to their future employers. We also teach basic skills, with the girls making garments and cooking (and they have very good cook-shops in some of our towns where people buy excellent products) and there are woodwork and welding courses, all basic skills that are of use in jobs.We also have task forces which help in various different ways and which help local community projects of a voluntary nature which would be impossible to get done in any other way. For example, we had a task force to help our community association clearing land for a car park. It was an eye-opener to the young people concerned to find that, in a community association, everybody, apart from the caretaker, was working for nothing on a voluntary basis. Certainly we encourage voluntary service and things like the Duke of Edinburgh's Award, whose underlying theme is always service.
Many of us in this House must have had the sad experience of watching people, our friends, become unemployed, and I submit that, whatever the Government in power, there would be considerable unemployment over the coming years. It is something people have to suffer. They have to look for new jobs and, as has been mentioned, often they must find new skills. They need strength during that period, because it is often a very traumatic time for the head of the family and his family. An abiding interest in some voluntary work will often help to bridge that gap and enable them to retain pride and not have a sense of rejection by society. Among the supervisors of our YOP schemes are people who often themselves have suffered unemployment. I have met many of them and they say what a satisfacton it is to be able to help young people. Often they themselves are skilled workmen who can pass on their trade, and they have a great pleasure in doing that for the young people they serve.
Another part of our education system is our further education colleges which, in Essex, take over £30 million

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of our expenditure. They offer a wide variety of courses, TEC and BEC courses, and I wish particularly to talk of the National Examination Board for Supervisory Studies, as the subject is industrial efficiency. Having sat in on their courses (which are meant for office supervisors, garage proprietors, people at a low or middle level of supervision), I can assure the House that they particularly encourage responsibility, and I remember watching a very amusing role play on how, and how not, to induct a new worker. They knew exactly how it ought to be done, and that is a very important part of industrial efficiency at a very low level.
We also have a regional management centre, which gives diplomas in management studies, and again one meets people in industry and commerce who are grateful for the opportunity of updating their skills in those fields and thinking of new ways of encouraging and enthusing our workforce so that we have an industrial upsurge in industry and commerce. As the noble Lord, Lord Vaizey, said, very important is the aspect of education and industry getting together and working in co-operation, and certainly we are grateful to industrialists who serve on our governing bodies and advisory committees for TEC and BEC courses so as to make absolutely sure that the courses we are giving are relevant to up-to-date industry.
That brings me to the national scene, and I was fortunate in 1973, when our present Prime Minister was Secretary of State for Education and Science, to be appointed to the Technician Education Council when it was first established, and the following year the Business Education Council was similarly established. Now, TEC has 200,000 students on stream. There has been a considerable rationalisation of technician education courses; they include engineering, surveying, mining and electronics, and they certainly contribute to industrial efficiency.
A great deal of talk this afternoon has been about universities. As the product of a university, I obviously want to see universities continue and flourish, but I would say with some feeling that no technologist can operate without technicians, and technicians are equally important and we need more of them than we need technolologists. Equally, the City and Guilds Council—they have 450,000 craft entries into their examinations and we are now going to a lower level as well, but equally the technician cannot operate without craftsmen—are developing foundation course: they have 15,000 students now in schools and they are often linked with further education colleges. Together with the Further Education Unit, they are developing general vocational preparation and that will lead to testing in basic numeracy and communication skills, and will produce student profiles. That is a very important level too, where young people are not going to have passed the higher examinations—and I include GCEs in that—young people who are very keen to get jobs, who would be very useful to employers, who are not academic but who are a very necessary part of our workforce.
I was very pleased to read in The Times today of the announcement yesterday by my right honourable friend the Secretary of State for Employment that £500 million is to be spent on a new training package: no mean sum. We shall have to await the details of
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that scheme, but I understand it will include apprenticeship schemes linked perhaps to youth opportunities projects and maybe extended up to two years. I welcome that very much indeed and look forward to hearing the details. I hope it will be carefully planned. I was talking today to our officer who is particularly concerned for our youth opportunities project in Essex. He was saying how many of these young people do not want to stay on at school with the same mixture all over again. I am very much in favour of young people who really want to stay on at school doing so, but for many at the age of 16 they want something quite different, something that will really prepare them for the world of work, preferably in the workplace where they can see how people operate at work. I very much hope that the scheme will include work experience on employers' premises and be very practical and attached to the world of work. That certainly will be a major advancement in the training of our young people.
I started by talking about what we are doing locally, and I cannot emphasise too strongly how' important it is to continue with local initiatives. When talking to employers one finds that many of them say, "You say there are many young people unemployed. When I want somebody to fill a certain job I cannot find one. Where are these young unemployed people?" Yet we know of unemployed young people who are anxious for jobs. The way that will be sorted out is at a local level, by schools and industry getting together locally. A local employer who wants, say, a metal craftsman will go to a local school in whose area that boy or girl could live, saying to a craft design and technology teacher. "Have you somebody like this? "perhaps the September before that person is wanted, and then, during the last year at school, the prospective employee could do work experience on the employer's premises for part of the week. If he fits in with the team and can be seen to be enthusiastic and to really enjoy the job, then there is a round peg in a round hole, a youngster who gets the job that he wants, as well as an employer who finds the young person whom he needs. We want to see that happening more and more often. The employers to whom I speak very often are looking for enthusiastic young people, young people with what I would call nous, who really can look for and find out quite basic things, who perhaps do not have long strings of examination successes, but who can prove to be very effective members of a workforce.
I think that those are all the points I want to make. I conclude with this idea of work experience which, as your Lordships see, has been the theme throughout what I have been saying. It was described to me this morning as an extended interview, a way in which young people and their potential employers can get to know each other and decide that the face fits. The Government are doing a great many things. The Government are planning to do even more, and that I welcome. But we must all bear in mind the importance of the things that can be done locally by co-operation between all the people involved.
6.31 p.m.
Lord Davies of Leek: My Lords, I listened with interest to the noble Baroness, who has had experience as a chairman of an organisation—I should use the term "chairperson". I have sat assiduously through

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the debate because I consider that a debate on education is one of the most important debates that we can have. I note that education—and we are not all quite stupid—always plays a key role in determining who governs Britain. That is another of the axioms that I collect, rather like Ruskin's famous axiom that there is no wealth but life. It is in education that we recognise the paramount importance of the life of an individual in the fabric of the nation.
Despite what we might say, and without being aroused in a party political way, we must face the facts about the days when the under-privileged were first given education. Here I pay a great tribute to the Church, which in its day started education for the very poorest. Since 1870 the élite system of the private school, wrongly called the public school, has produced leadership. Noble Lords opposite, and many on this side, are trained for the ultimate places of power in the government of the country. There is nothing wrong in that concept, but as democracy broadens the opportunity should be increased for the underprivileged to reach those places. I shall leave it at that.
Earlier I interrupted the noble Lord, Lord Elton, who is always courteous. I stopped him in the middle of his oratorical arpeggios. I stopped him because he said that our universities today have greater students than ever before. I interrupted when he was giving figures, though I do not contradict the figures. But I say that the students arc no better proportionately than they were in the days of the General Strike in 1926. Noble Lords might say to me, "Lord Davies, where is your authority?" I am always very careful about that. I suggest that the noble Lord follows the marvellous speeches in the television series on class. Dr. Eric Midwinter started the series, and in his speech said that it is like a race in which the rules never vary, but some of the runners are nobbled. People were nobbled in the old-fashioned elementary systems of education and in the under-privileged industrial areas of Britain, before we had this economic crisis. I shall be only 10 minutes, so do not get worried, my Lords. I could go on for a long time, but we have had a busy day.
Dr. Midwinter added:
"Since 1944 many members of the public have believed that with access to educational facilities available to all, then social justice has prevailed and those who ' deserve' to get on actually do. It must be firmly stated that, sorrowfully, the dreams of the educational pioneers have been, in effect, shattered. The proportion of working-class children at university now is not much better than it was in 1926, the year of the General Strike".
So said Dr. Eric Midwinter in the beginning of a television series on class.
I do not want to reiterate what has already been said in other speeches, but I should like to mention that I had the experience and privilege of chairing a Commonwealth conference in Sri Lanka, not long ago, with 41 nations represented. A number of young men, some of them now Ministers in the Governments of their countries, came to me saying that they regretted that the privileges and the scholarships at our universities and technical colleges were so expensive or were not available, and so some students were going even to Eastern Germany or to the Soviet Union. Do not call those people communists, my Lords, but think of the
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very reactionaries who have set up an educational system in which the under-privileged are less and less often being pushed into the stream of the power builders and the men with ideas. Now, funnily enough—it is the unity of opposites—people are being pushed into the hands of communists. I am not exaggerating. To me this is something that should be pointed out. We had an analysis of this in depth from my noble friend Lord Hatch, who has now left the Chamber—
Several noble Lords: Oh!
Lord Davies of Leek: It is nothing to do with me. I am trying to keep to the time schedule that I promised your Lordships.
Let us take the great Mr. Ian MacGregor, the chairman of British Steel. He is interested in building a bridge. The House may remember that I was a pioneer of the idea of building a bridge rather than a tunnel across the Channel. Mr. MacGregor is now pushing the Government into building a bridge. But if you do not have the engineers and the technicians, you cannot build anything. What does MacGregor say? He says:
"My concern is whether the education system of this country is doing the job we need of it…I submit that we are not doing the job of training the young people of today in all the skills necessary to ensure that this country is in the leadership in the development and manufacture of those sophisticated products that science and industry enable us to produce".
Those words were spoken at the recent annual dinner of the Institution of Mechanical Engineers by Mr. Ian MacGregor, the chairman of the British Steel Corporation. His words are significant because Britain is running down some of her largest industrial enterprises.
I read a document produced by the Common Market in 1973. It talked about industrialisation in Europe and of making one great industrialised area in Europe. Is there a sneaking idea that we look to the great industrial centres of the Ruhr, as opposed to the old industrial centres in Britain, that were built up in the days when England had 299 steam engines before anybody else in the world had any? Those engines were developed not by men from universities, but by men who had ideas. This is one of the wonderful things about an educational system. I am reminded of what Compton Mackenzie pointed out in his famous novel about an old Latin teacher, who used to get into trouble, but used to say to his pupils, "Anybody can teach you facts, anybody can reiterate facts"—like "Mastermind", if you like—" but we want people who can generate ideas". The perfect educational system should not only generate facts but should tell you how to deal with those facts, to generate ideas.
You cannot do that on a shoestring; and our greatness and our leadership in the world—and I am taking the best of it; I am not talking of the military side, which was there, but our loyalty—was because at one time we had the best universities in the world, the best technology and the best people in our teaching. But like today, in 1931—I am not old now, and I remember the setback in the profession—the ugly ducklings of Britain were some of the teachers who helped to build this. You see, you can harvest your fields, raise your derricks and sink your mines, but in the end, out of God's infinite goodness, from the boys and girls it is the teacher who makes men and

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women. I think the party opposite has placed the teacher at the bottom of the social scale, the social ladder, and I think he has to be replaced.
I said I would he only 10 minutes, so I am cutting out the rest of the speech I should like to make, but I should like to pay tribute, not only to the noble Lord, Lord Alexander, but to others as well, and to the Liberals. While we are seeking, in this micro-electronic world, to teach our people new ideas and new associations of their ideas because of the rapidity of communication, we must not become arid Philistines. It is still absolutely necessary to keep alive the cultures, to keep alive the arts, to keep alive the music and to keep alive, by the side of it all, science. And to keep alive, exactly! My hearing is quite good.
Lord Stone: I hope my remarks are, too!
Lord Davies of Leek: Yes, equal and equivalent to my hearing. Let me make my last point. It is no good the Government claiming that they have encouraged this, because MacGregor himself, and others, have pointed out where there have been cuts in ideas and in apprenticeships. It is absolutely necessary now that we build these apprenticeships; but there is a warning in the speech of the noble Lord, Lord Alexander. Remember that some of the teachings of today are teachings for buildings, organisations and machinery that will not he there tomorrow. We do not want training in the old technical colleges and the other old colleges using ideas that are already growing out of date. While we have to keep these alive and keep the pot of ideas boiling, nevertheless we should be striving for new ideas in a world that is growing more dangerous and more competitive. From whichever side of the House the Government come—and God help the people who call themselves SDP!—and whenever that moment comes, it will take leadership, and I believe this country can give that leadership only if it is prepared to spend more than it has ever spent before on the education of these children and these youths.
Last—will I forget it? Never! It cost me £6.50 through the Government opposite—the question which will be debated tonight is: What effect has all this had? The effect has been catastrophic; it has been cataclastic, which is different altogether from catastrophic; It is crushing. It has crushed initiative, and with millions on the dole we do not want to see what I saw in 1931. I am now looking forward to the noble Viscount, when he replies, giving us the usual demonstrative answer with fervour and understanding, and I hope that when he makes promises they will be kept.
6.44 p.m.
Baroness Fisher of Rednal: My Lords, may I thank my noble friend Lady David for initiating this debate, and all those who have taken part in it. I feel as though I am the pupil at the bottom of the class, no doubt cribbing from every other speaker who has been on their feet. I intervene with some trepidation, seeing the list of formidable speakers, including those who are to follow, especially as somebody with no letters after my name, only justice of the peace. So my education has been, perhaps, the education of life.
When listening and trying to absorb the arguments
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of the Government one is faced with the monotonous regularity with which Ministers emphasise the need for education to be geared to the requirements of our society. On all sides we hear from Ministers that we want more skilled engineers, more scientists and more technologists. That is the cry. "That is what the country will need when we move out of the current recession", they say. All I would say is that their actions belie their words—and I have to say this. One has to see what they say against the cuts in technical, classified universities; and one wonders (and I ask the question): Do the Government feel that applied knowledge is somewhat inferior to pure knowledge? Does applied knowledge mean something to do with industry, something to do with manufacturing, something to do with getting your hands dirty, and really is not relevant to government or to the thinking in Whitehall?
When we look at the location of the most seriously hit universities, we see that they are all in the Midlands and the northern half of the country. The biggest cuts in the university grants have been (what would one say?) north of Watford. As I think the noble Lord, Lord Bowden, said, they are Aston, Bradford, Hull, Salford, Keele—all going northwards. I think this makes so many people feel that we have to accept that the attack on university education reinforces the image that the reality of the university system needs to he kept in what are called the cloisters of Cambridge and the universities in those areas where class privilege is still, perhaps, practised more than in any other parts of the country.
I followed Lord Bowden with particular pleasure because he connected this breakaway of university education with society. He especially mentioned Manchester, but he drew a connecting line between education and society in those areas. He outlined how the universities and the colleges of advanced technology in the northern part of Great Britain have done a considerable amount to break down social barriers and to make people understand, I think, that there are working class attainments that can he measured and can be merited. What we find is that it is to the disadvantage of the north that the Government cuts have taken place. I would say (and I would ask the Government to heed this warning) that these cuts will in the future, I feel, create still further social problems.
It is no good, I think, the Government saying that they cannot find money to solve the educational problems. If they cannot find money to solve those, then they will have to find money to solve the social problems. The social problems are solved at the present time by money spent on extra policing, and that, in my view, is a waste of money. What we want to see the money spent on is prevention, and we do that by spending it on education for all classes and all communities. If one has to have priorities, I would say that we should spend it on that instead of our having the spectacle that we do have when the police are called in on so many occasions to quell disturbances.
It would be remiss of me not to make mention of Aston. I was a member of the Birmingham local authority for a great number of years. I remember Aston. It started off as Aston Technical College and it took the place of Central College of Technology in Birmingham when that was bombed during the war

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years. It moved to a new site and became a college of technology. It changed again and became an advanced college of technology. Finally, it achieved university status and became the University of Aston in Birmingham. I should like to say that Aston University—I am not on the board, nor one of the professors; I am not anything of great importance to Aston University except that I would say it was in the constituency that I represented when I served in another place—has the best employment record of any university in this country. Less than 5 per cent. of its students fail to find a job immediately after graduation. Approximately 80 per cent. of Aston graduates go directly into industry and commerce.
There is no problem about research—and this is not only research of help to the West Midlands but at the moment there is research on trout farms being undertaken by the Hydroelectricity Board. Aston has faced up to the criterion of providing more sandwich courses as advocated by this Government—and what else must a university do to achieve the excellence which as the noble Lord, Lord Elton, said must be preserved? What else must a university do to achieve excellence? With respect to the noble Lord, Lord Elton, it was difficult to get down any of the words of his speech but I managed to get the words, "excellence must be preserved". All I would ask is how he judges excellence.
Therefore, the cuts in university education (and in the technical universities in particular) to my mind are misguided and will lead to a worsening of educational opportunity and to the creation of an even more elitist system of education than we have now. What is it that an ailing economy, such as we have in this country, wants from its educational system? There are vague generalisations that the schools are not doing as much as they ought and that they should do more to encourage pupils to go into industry. If the Government hope to get the economy right—I think that that is what we are led to expect; although heaven knows when that will happen!—we will have to have greater need of what is taught in the schools, colleges and universities and to see that the balance is kept between the professions and those who seek opportunities in public service; to seek to get the balance with those in what I may call the more delicate fields of finance and all the other wealth-producing activities as between that and industry.
And so often when I am attending meetings or invited to dinners in the West Midlands, I am faced with industrialists of many large well-known companies in this country, who ask, "Do not the Government realise…" or "Are not the Government aware…". One feels that the dialogue which should occur between manufacturing industry and the thinking of the planners in Whitehall is missing.
This may arise because the systems of education that both sides have followed may have been different and therefore there is a limitation of cross-fertilisation of ideas. If one surveys the education of the 16-to-19 year-olds, it is not surprising to find that there is an appalling situation because it represents such a waste of human talent. I am of the opinion that the educational provision for this 16–19 age group must embrace all types of students on an equal basis in terms of status
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and resources and must be founded on the principle (as other noble Lords have said) of open access.
There has been a failure in the past to provide for roughly half the population in this group and those deprived have mostly come from what are commonly called the working classes. Government cuts are operating against the 50 per cent. who were former recipients because cuts in adult education and continuing education are the prime targets of most of the cuts by the local authorities. If we have cutbacks at that level, we also see a deterioration when we see the scrapping of the training boards; and other noble Lords have mentioned this. The cutback of training boards also means less opportunities for crafts and technical training. The number of people recruited for craft and technical training this year, and funded directly by industry, is the lowest annual total for the last 15 years.
I have been doing some research on apprentice training and job opportunities. One finds that the latest figures for last month show that 200 apprentices a month are losing their jobs many of these in the West Midlands. We also find joining the queues in the West Midlands are the numbers of skilled workers that are on the dole queues—the skilled workers, the essential lathe turners, the machine tool workers, all the people who will be important to us when the recession finally bottoms out.
Looking at the figures, as other noble Lords have said, two-thirds of the working population in this country—what we call the workers—are without any vocational qualifications at all. And if we are going to take any opportunities of increasing world trade, industrial training must be substantially increased, or else there will be doubts on the horizon as to the future of the country as a manufacturing nation.
We await with trepidation the rate support negotiations and the amount which will be allocated to the advanced educational pool which, as noble Lords are aware, is the central fund for financing higher education maintained by the local authorities. Any drastic reduction in real terms in the amount of money available will mean less students admitted to polytechnics and to colleges of advanced technology. This means that all the courses which lead to higher national diploma and above will suffer seriously. And it is obvious that the type of student who will lose out, again, will be more of what we call the working class. Therefore, we shall have again a workforce lacking in the skills which are needed to revitalise British industry. I would say that what is desired is that the educational opportunities for a certain section of the community need to be increased rapidly. This afternoon we have heard special pleading from very, very eminent people in the field of education. I have listened with great interest to that pleading. Since I have been a Member of this House, I have also listened on so many occasions to noble Lords whose grandchildren are doing extremely well at excellent places of education. I have listened with great interest to the pride of the achievements of their grandchildren, many of whom are not having to take education in what we call the public sector.
Many noble Lords in this House are able to help to provide education because they are perhaps some

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times of influence or sometimes of wealth. I should like to say that my interest is just as great for my grandchildren who will be receiving their education and their future achievements in the public sector. It is therefore incumbent upon me to speak up on behalf of the thousands and thousands of other grandparents who want to defend the opportunities for their grandchildren and those opportunities will only be found in the public sector.
7.1 p.m.
Baroness Seear: My Lords, only last week there was agreement between the Government Front Bench and speakers on this side of the House that the core problem in this country is the uncompetitiveness of British industry. If that is common ground between us, it seems extraordinary that the Government should be cutting back the investment in people without whom we do not have a hope of making ourselves more competitive. It will be very interesting indeed to hear from the noble Viscount, Lord Trenchard, how he reconciles these two positions: the need to be far more competitive than we are, about which we all agree; and this reduction in the money being invested in people. because this is what it is of course—an investment in people.
I am not going to rehearse the speeches which have been made this evening by other noble Lords about the need to have more trained people—the fact that we are behind in our competitiveness in the number of people who receive training; that we have a smaller proportion of our population going into universities. These points have already been made extremely well. Nor—your Lordships' House will be pleased to know—am I going to repeat the speeches that I have made so often in this House about the general importance of more training. I simply say two things: one is to the noble Viscount, Lord Trenchard. I hope that he will not tell us again that it is no good training people unless we can see a job immediately at the end of the training. We are training for a future; we are training for recovery. He nods his head. I fear that that is what he is going to say.
We are training for recovery, and the minute that there is an improvement in the GNP we shall be short of skills. But it is more than that. If people do not have any training, the future into which we are going is a future of almost total bleakness for the unskilled. If people are given some kind of training, then at least they have the opportunity themselves to find ways, maybe through small businesses or through community enterprises, to put those skills that they have acquired to some kind of use. If they do not have them, then their prospect is very poor. Even if one is not going to provide them with particular vocational training, the case for providing for a better level of education is surely unanswerable.
Something we know for certain is that we do not know what the demands of the labour market are going to be. We do not know what they are going to be in five years' time, let alone throughout the period of time that the youngsters who are leaving school today have to face. So, it is surely common ground between all of us that we have to train people to be flexible, and training for flexibility means at least a level of numeracy and literacy which—alas!—a great many youngsters
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leaving school today do not have. Those of us who have seen the advantages of education linked to work know that it is true that youngsters who do not learn well at school learn the same subjects very well when they can see some relevance and when they are linked to work.
I think that I may have told your Lordships' House this before: I remember very well indeed —and this is a point which perhaps the noble 'Viscount will also appreciate—in 1940 seeing lads who had come from village schools who could spell "chrysanthemum" but who could very seldom spell their own name, because learning to spell chrysanthemum was one of the first things that they were taught in the village schools. I can remember seeing those lads learning trigonometry because they had been told that in order to become pilots in the Air Force they needed to know trigonometry. That is the way in which people can be made to respond to educational opportunity. That is the kind of opportunity that we can give if we do not cut back at this vital stage.
I also want to say—reinforcing what the noble Lord, Lord Flowers, said—that it is not enough to have a fair number of people who arc great specialists in technology, who really understand the microelectronic age into which we are going. It is not enough to turn out the specialists and the masters if the rest of us remain in a state of total ignorance of these matters and therefore cannot respond to the new machinery, the new openings and the new opportunities which arc there. Like the noble Lord, Lord Elton, I was a graduate in history, and I am ashamed to say that I am still rather like Thurber's aunt so far as electricity is concerned. I have a sneaking belief that if there is not a bulb in the light then electricity is coming out of the light fitting. It is not good enough to have people going round at that level of ignorance. It is had enough now; it is going to be a great deal worse as the electronic age advances. Therefore, there has to be a general level of improved education and understanding of the new technological world throughout the population if we are going to put it to full use. That is all I want to say about the general issues which have been so fully discussed in your Lordships' House this evening.
I want to confine myself to asking the noble Viscount a few specific questions on what may seem to be rather narrow points. In the first place, we talk a great deal about the links between school and work, and the need for improved understanding in school; the need to develop opportunities for youngsters in school to have experience of work and to have this built in as part of the educational process. That is going to happen. We have to have far more people in the schools who really do understand something about the world of work.
I have had three opportunities this year to attend in Birmingham three week-end sessions organised by a brilliant education authority for industry, headmasters and headmistresses. I believe that those weekends were valuable; that they achieved some of their purposes. Equally, I was horrified at the level of non-understanding that was betrayed by quite a number of people on the educational side. Sitting quietly at breakfast, listening to headmasters talking to each other, I began to despair.

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The need is to have people in the schools who really understand. We have a great many unemployed teachers at the moment. Can the Government not make it a priority to get training courses for teachers organised so that they can in fact begin to bring into the schools and into the work of the schools knowledge—which will influence the heads of departments teaching other subjects—of how industry works? Industry is a shorthand term of for the world at work. I mean the way in which industry works. This is not going to be done by week-end courses or letting people off for a week or two; there is a great deal that they need to learn; there is a great deal of unlearning that has to be done, and that often takes longer than learning. Surely now is the time, when the teachers are unemployed, to find people who can do this and who can carry through in schools the very difficult work of building bridges with industry. Some schools are doing it already: of course they are. The noble Lord, Lord Elton, said many were doing it. I should be very interested to know how many are doing it really effectively. I do not believe it can be done unless you have staff who are specially trained in order to do it.
Along with that, I would ask for expansion and not contraction in connection with careers advice. It is still true that careers advice is given too late to influence the subject choices of a great many youngsters. They need to be advised, as do their parents, about what is involved in certain kinds of career at the time they are choosing what subjects they are going to do, not when they have finished those subjects and gained their CSE or O-levels in them. They need to have this advice much earlier in their school career.
Of course it is collaboration between the careers service outside and the careers teachers inside the schools which is needed; but until this is taken more seriously and until more resources are devoted to it—because that is what it is all about—people will continue to be inadequately prepared because they will take the wrong subjects and, having done so, they will have closed doors to careers which subsequently when they know more about them they wish they could have taken. So we need teachers trained now so that they can really carry out this job of liaison between work and school, and more careers teachers.
Now, I turn to the question of once they have left school and gone to work: the whole issue of vocational training. We shall be debating this at greater length after the Secretary of State has made his statement about what he intends to do regarding the New Initiative: that is a very promising document, if the Secretary of State is going to take it seriously. It is common ground now that the training element in YOP has been inadequate. The MSC says this, and everybody says this: the 16 to 18 year-olds need to have a much better-planned period which will be a mixture of work and training.
I think there is no doubt that for the great majority of youngsters the best training is that initiated by the employer; the employer is the person who knows what training is needed and what training is needed for the future. There is always a grave danger, when training is carried out in the educational institutions, that they are training in what used to be needed and not in what
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is going to be needed in the future. Only the employer who is exploring new markets, studying new methods, new machines and new processes, can know what are the changing needs for the future. Therefore, the training ought to be initiated by the employer, working of course in conjunction with the education authorities.
The intention, as I understand it, is that a bigger training element is going to be built into these Government schemes: there will he more WEEP, more YOP, and so on, with a greater training element. But there is an enormous amount of difference in the quality of training given by different employers. There are some work experiences which are simply not training experiences at all, though they may have some of the trappings of training. We need to know what makes a good learning environment in the place of work. There is some very interesting study being done at the present time—and here I must declare an interest—in the Tavistock Institute, with which I am connected, to try to disentangle what creates a good learning environment at work and what is just really work experience with very little training in it. We are finding, of course, that in some places the learning environment is excellent and in other places it is not. We want to see to it that, where the learning environment is good, the employer is encouraged not only to train for his own needs but to train for other people's needs too, because that is where the best training is going to be.
I do implore the Government, having got rid of some of the training boards, to recognise that it is cloud cuckoo-land to think that at the present time, when cash flow problems are as they are and bankruptcies are as they are, when some of the greatest firms in this country are finding it difficult to meet their immediate requirements, they are going to lay on extra resources to meet this kind of training. They are not doing it even for their own people, because they cannot; and it is shortsighted folly of the first order to cut resourcse to those organisations and to say that all funding for training in industry has to come out of industry itself—because it cannot: it cannot. I wish you had not abandoned industrial training boards but if you have, you have. However, that does not matter so much if resources can be made available through some other channel. But it will be fatal—I repeat, fatal—for the new kind of training that we need for the 16 to 18 year-olds if you are prepared to leave all the funding to come out of industry at the present time.
One point that I want to make concerns the universities. Many others have spoken very eloquently about universities. I find it incomprehensible—and I am Oxbridge Arts myself—that the cuts have come on the technological universities. Why Aston, why Salford, why Bradford? We are entitled to an answer to that question—why Aston, why Salford, why Bradford? It is not good enough to tell us that the University Grants Committee made the decision and we are not expected to ask questions of that committee. This is one of the most vital questions we can ask; and if Parliament cannot ask on what basis these decisions were made, what good is Parliament?
The story is going round—I do not know whether it is true but, if it is not, I should like to hear it refuted—that a major consideration was the A-level grades of the students who were taken into those universities. If that is true, the bias built in against technology and

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engineering is of a gross order. We all know that if you are going to take an arts course you have to have very much higher A-level grades than for engineering and technology. Therefore, if the decisions were made on the basis of A-level grades, the technological people are down at the bottom of the pile before they start. I do hope the noble Lord is not going to tell us that we must not inquire into what the University Grants Committee has done. I am sure he is going to tell us that, but I urge other noble Lords to support me in saying that we arc not going to take no for an answer on this. We have to know how these decisions were made. It is affecting the fate of a very large number of youngsters; it is affecting the fate of industry and it is affecting the fate of the economy. If we are a serious House of Parliament, as we are, we cannot just be told that it is left to a group of worthies to decide how this money is to be distributed.
Finally, may I put in a plea to back the points made by the noble Lord, Lord Kilmarnock, and the noble Baroness, Lady David, in relation to adult education? Here I declare an interest as chairman of the Morley College Council and President of Hillcraft College. It is greatly feared in circles other than in education that, because there is no statutory obligation to provide adult education, adult education will be very badly attacked by local authorities who have to spend money on other aspects of education but do not have to spend it on adult education. Surely there never was a time when we needed good adult education more than we do now, so that people who are unemployed can find useful ways to occupy themselves in good adult education colleges. At Morley College at the moment, in a class which would normally have been occupied mainly by middle-class ladies, we have a redundant engineer, a Ph.D., who cannot find a job and we also have a number of arts graduates. I cannot tell you what they are doing but surely, whatever it is, they are better doing that than they would be just doing nothing—my Lords, it is what you call "soft sculpture". I do not know what it is, but that is what they are doing.
In addition, the adult education colleges are tackling very serious social problems. They took a leading part in the illiteracy campaign, they are taking a leading part, where they are properly situated, in dealing with the problems of ethnic minorities; and they have a great flexibility in laying on courses which have a real vocational element in them.
For all these reasons, they are one of our most important instruments of education at the present time and, rather than cut down on adult education, I beg the Government to guarantee that they will do something to see that it is at least maintained at its present strength, and preferably improved.
7.21 p.m.
Lord McCarthy: My Lords, we have had a lone, interesting and good-tempered debate; in fact, a debate in which we have seen this House at its best. It falls to me to make the penultimate speech from this side, and I wanted originally to do three things; first, to reply to the points made against the noble Baroness, Lady David, which were not anticipated on this side of the House by other speakers; secondly, to advance certain points of my own about certain aspects of training which she did
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not deal with and, in particular, to deal with the decision of the Secretary of State for Employment to destroy two-thirds of the industrial training boards, and, finally, to make a few remarks which link training and industrial efficiency, which are mentioned in our Motion tonight.
But, of course, it has been a fact in this debate that virtually nobody on the other side of the House, with the exception of the noble Lord, Lord Elton—I except him from this; that is his job—has come forward and attacked this Motion and defended the Government. Of course, we expect a certain response from the noble Lords, Lord Stewart, Lord Bowden, Lord Hatch and Lord Davies, as well as from the noble Baronesses, Lady Jeger and Lady Fisher. But it is remarkable—and one is a little surprised to find it—that virtually nobody on the other side of the House has really come down to defend the Government and to attack this Motion.
Therefore, the only points to which I have to reply are those raised by the noble Lord, Lord Elton, himself, and I do not have many of those, because he appeared to spend of his time with what he called his light artillery, destroying Mrs. Williams's attack on the direct grant schools. I can only say that I think that point was answered, and fully answered, by the noble Lord, Lord Stewart, the noble Lord, Lord Hatch, and the noble Baroness, Lady Fisher. The point that we are making on this side, so far as that subject is concerned, is that the noble Lord has misconceived excellence and seen it as class privilege; that his concept of excellence is confused with a considerable element of élitism, and that is not at all our concept of excellence.
But the noble Baroness, Lady David, asked the noble Lord a whole series of questions. I ran out of all the questions she asked him. She asked him why there was nothing in the Queen's Speech on the legal basis of education; she asked him about the costs of A New Training Initiative and the Government's attitude towards the MSC; she asked him if he had considered whether the university cuts could be spread over a longer period, and many other questions. I cannot say that he did not answer any of those questions, because I must admit that at one point he said, "That is an answer to the noble Baroness." But, unfortunately, he was going so fast, or I was listening so slowly, that I was not sure what that was an answer to, and the noble Baroness cannot tell me, So I hope that some of those unanswered questions will be answered by the noble Viscount, Lord Trenchard, when he comes to reply.
Therefore, I want to turn to other aspects of this training debate than those which were raised in detail by the noble Baroness. At this time of night, I want to deal somewhat quickly with, as I have said, the decision of the Secretary of State for Employment to destroy two-thirds of the ITBs, or to reduce their coverage from about one-half to about one-third of industry, so that roughly two-thirds of industry is now left to non-statutory provisions.
I would make two points about this. First, a great deal has, rightly, been said by the Government and by the defenders of the Government about the fact that the Government have actually retained six out of seven of the ITBs which the MSC unanimously

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asked them to retain. The point I would make about that is that that indicates that the Government accept the utility of these extremely important institutions in certain critical areas of the British economy; for example, engineering. The second point I would make is that it makes it even more difficult to understand why the Government have decided to abolish all the other industrial training boards, as has been said by a previous speaker, in direct reverse of the general arguments put before them by the MSC.
Let us remind ourselves what the MSC said in their central review. First, they complained about the fact that they had been given only six months to decide these very complicated issues. Secondly, they said it was extremely difficult to decide the fate of most boards, other than those whose continuance they recommended, in advance of what the Government intended to do as a result of A New Training Initiative. They said that they wished they had had the attitude of the Government to the NTI, before they were asked those questions. Thirdly, they proposed a compromise, in virtually all the cases in the private sector where they did not suggest the maintenance of an ITB. They proposed that, since they were unable to decide, there should be an interregnum, in which the parties should seek to explore the possibilities of voluntary regulation. The implication was that, if voluntary regulation showed itself to be adequate, then the ITBs should be abolished. But if it turned out in the course of time that voluntary regulation was not adequate, then the ITBs should be retained.
Therefore, the first question that I have to ask the noble Viscount, Lord Trenchard, is: How does he defend a decision of that kind and, in particular, how does he defend it in the light of the three priorities of A New Training Initiative, as they have, as we understand it, the support of the Government? Two of the objectives—the need to develop skill training to enable young people to progress by agreed standards as jobs become available: and the opening up of opportunities for adult training and upgrading, via, for example, the Open Tech. —must involve, as I am sure the noble Viscount accepts, the closest possible tripartite negotiations between trade unions, employers' associations and the Government.
They are, above all, industrial relations problems. You will not develop skill training, you will not modify the apprenticeship system and you will not get upgrading and adult training, without very close relationships between trade unions and employers at national level, and without the Government sitting in on those negotiations. So how can the abolition of two-thirds of the ITBs be justified in reference to these two objectives?
Thirdly—and this is the point on which I want to spend a little more time—there is the move towards the position, to use the Government's phrase, in which all 16s to 18s will be given the opportunity of full-time education or some mix of training and work experience. The first and second are basically industrial relations problems which need to be jointly negotiated. This one, above all, is a resource problem. This third problem, above all, requires very considerable influxes of public money, as well as some form of statutory
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machinery either through the ITBs or, perhaps, in addition to them, through some more local systems.
It is extremely difficult to see what alternative proposals the Government could come forward with for carrying out this third objective, unless there is to be statutory regulation, tripartite boards and a very considerable influx of public money. The only way that I can think of doing it, without a structure of that kind, is to use the Swedish model where you have full-time education and training for all inside a state system. But, of course, we know that that is an extremely expensive model and it exacerbates the divorce between industry and education and training, which we all want to stop.
Therefore, I ask these questions in the light also of the statements. if I may put them this way, which we have seen today in the newspapers; that the leaks (and leaks about this Government have been particularly reliable in the past) seem, if I read The Times, the Telegraph, the Financial Times and the Guardian, to establish three things. First, they seem to establish that the Government are planning to spend varying additional sums of money (these newspapers vary from time to time as to how much) on some new training initiative for young people. Secondly, the Government propose a training rate which varies between, some people say, £28, which is what the Manpower Services Commission suggest, and £15 which, some journalists tell us, is what the Treasury suggest. The third thing which we gain from our newspapers is that the Government are also considering how far such a system should be compulsory. In other words, if young people refuse the training rate, whether it be £15 or £28, then they should be refused supplementary benefit or any benefit at all.
At this stage I am not asking the noble Viscount to say how the Government are going to react, nor am I asking him to say how far these leaks are reliable. For a few moments I simply want to say how we on this side of the House would react to these three areas of discussion. My first point is that I doubt whether any of the sums suggested, even the largest, in any of the newspapers really begins to allow for what this kind of expansion would require. If you were serious about serious training for all 16- to 18-year-olds, there would have to be extensive capital development and revenue costs because the existing colleges of further education and tertiary colleges could not conceivably bear this weight. We should also need very considerable subsidies of employers in order to get employers to take anything like the present 40 per cent. or so of youngsters who now receive post-16 education. Therefore, there would have to be very considerable subsidies for employers and very considerable capital and revenue costs. I wonder whether the Government have thought of the sums involved.
Secondly, and because of the sums involved, there is a temptation with a scheme of this kind to solve it by cutting the training rate—by trying to push the training rate down not merely to the level of the present YOP rate of £23·50 but maybe to some figure round about the rumoured Treasury rate of £15. Here with great seriousness I would recommend the Government to think very, very carefully. This would inevitably mean the rejection from its inception of what could be an extremely useful scheme. This attempt to drive

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down the training rate below the YOP rate would mean that the entire trade union movement and the great majority of young people would regard this as what in fact it would be: an attempt to get cheap labour at their expense.
And if there is no solution by cutting the cost, by driving down the training rate, the third point I would make is that there is certainly no solution by the introduction of compulsion. If we are to have a situation in which the training rate is to be below the YOP rate and the alternative of refusing that rate is to be the denial of supplementary benefit, then what begins as an attempt to keep people off the streets drives people on the streets for similar purposes and similar objectives to many of the disturbances we experienced earlier this year.
Finally—this is the last point I want to make about the rumours and the rumours of rumours that one reads in the newspapers—the Government must appreciate that what they are proposing savours of a training solution to unemployment, especially if this is combined with a reduced training rate and an element of compulsion. What one is trying to do in those circumstances is to keep young people out of the labour market by offering them a modicum of training so that one can pay them something near or in fact at the present unemployment and supplementary benefit rates. The attraction of this is that you are massaging the unemployment figures because you are taking young people out of the labour market, and the hope that you will get very substantial resources of cheap labour makes you hope that you will drive down both the existing youth rates and the adult rates themselves.
This is not just imagination on my part. The one bit of job creation which has been created by this Government, the famous Young Workers' Scheme, so close to the Prime Minister's heart, is exactly like that. It is the cheapest scheme of the lot. It costs one-third of the cost of YOP. It is actually a positive gain on the present cost of unemployment benefit. And—even more attractive, of course—what money it costs goes to the employer. It does not even go to the worker. There is no nonsense about training and there are no controls over substitution. If the Government have introduced and enthused and supported the Young Workers' Scheme in the way that they have, then we are bound to wonder what is going to be the shape of the new training initiative—which brings me to my final point: the link between training, efficiency and employment.
I have said that the Government must reject a training solution as a solution to the problem of unemployment. This is not to say, as we on this side of the House have today said, that we do not need a lot more training. But it is not a solution to the problem of unemployment. The problem of unemployment in this country is not just mismatch; it is not just that we need more skills; and it is not just high wages, though high wages are a problem, particularly high wages for young people. It is, fundamentally, a shortage of jobs. A shortage of jobs requires an increase in jobs, not merely the training of those who are out of jobs and at the end of the training period throwing them back into unemployment.
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Consider the facts. Unemployment is rising now at such a rate that if it continues at this rate there will be approximately 4·5 million on the registered figures if this Government survive their full term. Moreover, off the register, various calculations have been made, the most conservative of which mean that, at that rate of increase, by the time of the next election registered and unregistered unemployment will be in the region of 5·5 million. At this moment there are 30 applicants for one job. If one thinks of the special groups, region by region—of the youth, of the disadvantaged, of the ethnic minorities—the chances are that for many of them there are 50 or 60 applicants for one job. And, most significant of all, the rate at which long-term unemployment—that is, six months and over—is rising is now about 400,000 a year. Therefore on the evidence of the Manpower Services Commission, by the end of 1982 there will be approximately 1 million long-term unemployed.
In this situation it is no answer to say that we must have a training solution. In this situation it is no longer possible to support what I call the phoenix theory of economics, which is the theory of economics beloved of the Treasury: that you freeze the economy and depress the economy until, once and for all, there is a shift from wages to profits and the economy rises like the phoenix. But it takes too long. It is too costly. The phoenix is a mythical bird. In any case, he took five centuries to rise from the ashes. And we have not got that long. In the meanwhile, the blizzard continues and the Government pretend, by their training initiative, that it is not even cold outside.
"They are like the young man of Quebec Who fell into the ice to his neck; They said Are you frizz'? He replied ' Yes, I is But we don't call this cold in Quebec'".
But it is cold. It is freezing outside. The Government, in addition to their training solution, must have an employment solution. I am not suggesting a general consumer-led expansion.
I am not suggesting an expansion by tax cuts. Much evidence exists to show not only that that would take four years and 5 per cent. growth to get anywhere but in fact that long before this sort of general consumer-led expansion could produce any significant improvement in the employment situation it would "go bust" anyway. But I am saying that the Government must seek to overhaul their job creation policies. They must seek to develop what elsewhere we have called long-term low-cost, group-specific net job creation, and they must seek to do that not simply in the private sector but in the public sector, too. They must overcome their terror of any permanent expansion of employment in the public sector if they are to supplement the very necessary things which need to be done about training with something to be done about employment.
Therefore, and in conclusion, we have been arguing tonight that the central thrust of the Government's economic strategy has been taken to a point where it has become élitist, negative and where its long-term contribution has been to depress, and is in danger of destroying, the contribution of the education and training system to industrial efficiency. Most speakers in this debate have said where they think this is the case in education. I have tried to spell out where I believe it to be the case in training.

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In opposition to what the noble Viscount may say, on this side of the House we have not been asking for an unrestricted, unthinking expansion of public provision. Almost everybody who has spoken on this side of the House has specified that we have to be careful to take into account the parlous state of our economy. There is a long list of things that have to be done and the resources available for these things are not unlimited. What we are arguing for above all is a change of direction and maybe a slight admission of past responsibility.
7.43 p.m.
The Minister of State for Defence Procurement (Viscount Trenchard): My Lords, the Motion in the name of the noble Baroness, Lady David, which she introduced, actually asks us
"to call attention to the effects of Government policies on education, training opportunities and industrial efficiency",
and indeed looking at that very wide range of subjects we on this side of the House imagined, since they were not in any way linked in the Motion, that all three were equally important in the minds of noble Lords opposite. But indeed, as the debate has developed, even those with knowledge of many other areas bearing on industrial efficiency and the expert knowledge of the noble Lord, Lord McCarthy in industrial relations, for instance, have not even raised those subjects.
My noble friend Lord Elton covered to a high degree—and I shall add some answers to the noble Baroness, Lady David, at the end of my summing up—the education side, and I shall return to that only last. In a way I am probably going to disappoint the House on the subject of training, for the very simple reason that my right honourable friend the Secretary of State for Employment has said that he will be making a Statement before the end of the year, and he hopes to make it before Christmas. Your Lordships will probably have read the part of the Statement in which my right honourable friend the Chancellor of the Exchequer referred to the expenditure for the further major expansion of training which we plan to implement. I will also come to that later.
I wonder whether I should alter to a high degree the remarks which I had thought I should need to introduce into this debate from the Government's point of view on industrial efficiency. On reflection I have decided that in a way, in such a wide-ranging debate as this, it will pay me in fact to spend more time on a subject in which I have had a life's experience, which has some bearing on the subject and also I believe it answers, to a very high degree, the very many pleas from many experts in the educational field which we have heard today—a number of them heartrending pleas—for a little more consideration here and a little more consideration there.
I believe that the problem is one of, which is the chicken and which the egg? To a degree, speakers in this debate and noble Lords opposite have contended that many of our trimming—and I use that word deliberately—measures of public expenditure, including those in education, are harmful to the country's future and particularly to its industrial recovery. However, the Government tend to believe—and I shall try to answer the Motion in these terms—that
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until this country's wealth-producing industries have been greatly re-expanded on a competitive basis there must be limits to many, in themselves desirable, Government expenditures, of which education in general is certainly one.
I was moved by the appeal made by the noble Baroness, Lady Jeger, concerning the part-time university student late in life, and that was a theme that was also taken up by the noble Lord, Lord Kilmarnock, when I was not in the Chamber. But there are appeals to any Government in power, as noble Lords opposite know well, for a little more support for this, for a little more support for that and for a little more support for the other. I will indeed make sure that my right honourable friend the Secretary of State for Education, with whom I spoke before this debate, does look at the Hansard report of this debate and at the many points which have been made.
But as the noble Lord, Lord Stewart of Fulham, suggested, I believe it is wrong to suggest that defence is the only area (which he mentioned) where Government have put up public expenditure. Our health expenditure is significantly up, and we are talking to a high degree of trimming in many other areas. The noble Lord, Lord Stewart, suggested that the whole problem could be solved if we had not reduced the higher rates of income tax. That is really to overlook the fact that the amount forgone by the Chancellor on the higher rates of tax and the high levels at which they were to be applied in the first of his Budgets, cost him £662 million; and I shall argue later that those tax moves, which make us no more than competitive with some main competitor countries in incentives to the critical area of management, have already had a degree of effect in what I believe is an emergent industrial recovery.
Notwithstanding the need to trim education in general, we have expanded training greatly and some education, which my noble friend dealt with earlier, both to come into line with successful competitor countries and to do everything we can, as noble Lords on all sides of the House have asked us, to prepare the unemployed (and particularly the young unemployed) for the jobs—and I say this to the noble Baroness, Lady Seear—which assuredly will come as our newly-won competitiveness begins to provide new real jobs in modern industries. I shall return to the sheer weight of our training effort later on.
I wish to start now at the other end of the wording of this Motion. The primary need for this country is industrial efficiency and competitiveness. The primary misunderstanding, if I may say so, lies in failure to recognise in some areas for how long we have been uncompetitive. As a 30-year full-time industrialist, turned amateur politician lately, I am one of those whose pleas to realise the degree of our growing uncompetitiveness went unheard in the '60s and '70s.
Many people still simplistically believe that unemployment has only escalated fast in the later years of the last Administration and in the first two years of this Administration and that therefore the cause lies in this period. The truth, of course, is otherwise. In 1960 we had almost a 20 per cent. share of world markets and our manufacturers dominated most of the sectors of the British market. By 1975 our share of world markets was down to around 8½ per cent. In

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any normal era this disaster would have reduced our standard of living and all desirable Government expenditure to far below its present level, including education expenditure. But the era was not normal, as has been mentioned today by my noble friend Lord Vaizey, and I think by the noble Lord, Lord Bowden. It was a period during which the economic wealth of the free world more than doubled, and in spite of our losing over half of our share of markets our total industrial production did not decline; neither did our standard of living, and education, as we have heard from the figures this afternoon, boomed. I think most economists doubt whether we shall ever see a period of world economic expansion as fast as that in which British competitiveness declined so abysmally.
But the fact is that the chickens did not come home to roost until this period of exceptional world growth came to an end. To some of the more observant members of the public it was clear what was happening, as Japanese motor-cars and other foreign motor-cars flooded the streets, as television sets became more and more of foreign origin, in spite of being a British invention, and all similar examples. And they wondered, and I remember lots of people saying to me during the '60s and '70s: "How can it go on? How can our standard of living stay up when this is happening? It was world expansion which allowed it to go on.
The idea that unemployment has been caused by excessive monetary restraint is not borne out by the facts. Money supply, a vital ingredient in the general mix to be controlled, has been allowed to increase to quite an extent, at times to an extent greater than we wanted it to, in spite of no growth in industrial production. We have in the past had many debates in this House on the reason why we lost our place in the industrial world and why our industrial efficiency was so bad. Management, trade unions, the City, have been blamed as scapegoats, and so has our education system.
But we have also seen that there is nothing wrong with the British. They have maintained their record for inventiveness in research and development, they have the finest armed services in the world, and in spite of recent difficulties I believe the finest Civil Service in the world. Their efficiency in the City of London in difficult conditions, and in retailing, and in high technology agriculture, have shown that there is nothing wrong with the British. My own long experience in an international company, where I had the opportunity to move British management abroad and foreign management into British factories—and that was the hardest thing to do within the law, bearing in mind our tax situation at that time—absolutely confirmed to me that there are good, bad and indifferent in every country and that there is no basic disadvantage from which the British suffer. It is true, as we have touched on the question of engineering education, that in the volume of engineers to apply things in the factory there has been a shortage; that is acknowledged, and to a high degree that in the short term is being solved by more and more expertise from abroad. The long-term solution has to be in education.
I believe the whole country knows that we have the strongest trade union movement in the western world, and that our attitudes, and the atmosphere and the
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systems of collective bargaining, have been a major factor in our failure to apply industrially, particularly in our large factories, the continuing genius of our people. This is why we believe that the changes which we have already made—and these are Government policies to do with efficiency—and the further changes which my right honourable friend the Secretary of State for Employment has now announced have helped and will help to restore industrial efficiency. I do not believe that these changes, as has been suggested, are divisive or are not even-handed. A previous generation of trade unionists would have given their eye teeth for the sums of compensation suggested, not only for losing a job as a result of a trade union closed shop situation, but also, let me remind the House, that compensation being open to a company that refuses to have a trade union member. A previous generation of trade unionists, and trade unionists abroad, would be very grateful to have such a clause.
I will not—since the noble Lord, Lord McCarthy, contrary to my anticipation, did not go into it—go into the area of the closed shop. I will merely say that industrial efficiency is affected by these areas to a very major degree. Our position is, in my mind, often summarised by the Japanese industrialist who said to me, when his factory in this country went out on strike and he had no dispute between his managers and workers, "Can you explain it?". I could not. I believe some of my right honourable friend's proposals will produce a situation where that kind of highly-skilled company from abroad will also increase its investment in this country, and that will lead to an increase in industrial efficiency.
Even after my right honourable friend's further reforms of the trade union situation have been brought into effect, we shall still have a greater degree of immunities in many areas, and a less ordered situation for our big factories, than I found British managers had when they worked in Germany, in Holland, in Belgium and in North America. I believe, however, that we will have moved far enough at this stage towards a situation when our Achilles heel in our big factories will begin to be put right. I think it will take a little longer to get industrial efficiency into the many areas of huge nationalised industry which we still have. Enormous steps forward have been taken. The noble Lord, Lord McCarthy, suggested that we have an obsession or a dogmatism in this area. Let me pay tribute to the enormous steps forward in productivity that British Steel have achieved in the last two years. Let me nevertheless say that for our large nationalised organisations as a whole we have a problem, as I believe the sheer size and the constraints of the public sector do make it a lot harder to get the kind of efficiency that some of those industries abroad which are not nationalised are able to get.
The exceptionally tough period through which industry has passed—mainly because of the end of world growth, as I described at the beginning, and augmented to a degree by a very strong exchange rate—has produced a change in competitiveness in a very short space of time. Today, with a more natural exchange rate and with a new attitude to production, things have started to improve. One must not put too much weight on short-term figures and there may be false dawns. But, in fact, the move up which

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started in the second quarter has continued in the third quarter, which in manufacturing production is 1.5 per cent. up on the second quarter. Furthermore, and perhaps more important, the productivity increase in manufacturing industry, the output per man—so long the bedevilment of British industry-has, in fact, improved by 10 per cent. in the third quarter of 1981 compared with the low point of the fourth quarter of 1980. Output per man has improved by 7 per cent. compared with the same quarter of the previous year. If, with this quite different attitude, which all my contacts with industry both at the Department of industry and now at the Ministry of Defence show up; if with this growing competitiveness and a reasonable exchange rate and with a great deal of spare capacity, volume continues to move up then we shall, indeed, confirm the start of recovery and go on from there. Considering the period of time over which we have been uncompetitive and lost our share of market, I suggest that Government policies are working.
Our exports have always held up well. Order books are stronger. The engineering order books are 41 per cent. up, by volume, in the three months to August this year. There is major activity on the small firm front encouraged by the 72 measures taken since we came to power and encouraged by the taxation changes which the noble Lord, Lord Stewart of Fulham, criticised today.
We have maintained schemes started by the previous Administration: the Microprocessor Applications Project, and others, in the micro-electronic area. We have increased expenditure on robotics and on optical fibres. Small factories continue to boom. Finally, I want to make the point that our share of market which came down from nearly 20 per cent. in 1960 to a low of 8·4 per cent. was up to 9·7 per cent. in 1980. We do not yet have the 1981 figure. That is another way of saying that, if we still had world growth at this period, we would have been showing a much bigger increase in manufacturing volume than currently shows at present.
Let me also say that if we had retained, say, 11·5 per cent. share of world markets and a similar share of our own market and had not fallen all the way to 8·4 per cent. from 20 per cent., I doubt whether we would be talking about unemployment in the same terms as we are today. Indeed, there would be shortages in many areas, and here again I take the point made by the noble Baroness, Lady Seear, in relation to training for the future.
I do not want to give too great an expectation. I believe that some economists may be a fraction out of date and some forecasts too. Indeed, they were out of date on the fall of industrial production. Nevertheless the future is not a bed of roses. We may have further setbacks. There are some long-term indicators that are not looking as they should. We are dependent on United States' interest rates and world situations to a degree. I also accept that employment pickup will follow economic growth and by a considerable margin. So it will take time. But the only way to get back to full employment is by a continuation of gain of share of market and, if we are helped, a return to a growth of world market.
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I turn very quickly to training. As I have already said, my right honourable friend the Secretary of State for Employment is to make a statement before Christmas. In total, the numbers involved in training schemes over the last three years have moved in the MSC area from 317,000 to 683,000 people under training. Expenditure in the same period has moved from £266 million to £715 million and in total training to £911 million.
My right honourable friend the Chancellor of the Exchequer this afternoon announced that the planned employment figure, which resulted from the July measures in training, would have risen to a £2 billion per annum expenditure. He has announced that he has made provision to add £800 million to that figure. I listened to the noble Lord, Lord McCarthy, putting forward his view of the ideal form of training scheme in a certain area. I must tell the noble Lord that he must be patient until my right honourable friend announces his new developments. But I think that noble Lords must ask themselves whether, with a declining share of market over which they presided, with a recession they could have found £2.8 billion for employment measures.
Apprentice training has been increased to £50 million support this year from very little three years ago. I must make the point in passing here that the cost of training in Germany, much mentioned by noble Lords opposite today, is, of course, much lower to the industrialist. While I can assure the noble Lord, Lord McCarthy, that our schemes will, indeed, be designed to keep people off the streets and not to substitute for employment that would take place otherwise, I do think that we have to look very closely, against the background of what has happened to this country's position in the world and the need to fight to retrieve it, at the rates we should, in fact, pay for apprentice training.
The training boards have been mentioned. The seven largest ones are to be maintained on the same basis as before. In the vast majority of the remaining areas, discussions with the industry lead us to be hopeful and these overlap with the announcements yet to be made that the kind of training that will continue will match needs. I do not think that we can assume that the training board system with quite a heavy element of administration and of in-and-out of funds, was in every case a complete success and I believe that the Government have taken the right decisions. The fact that those decisions are not necessarily in line with those who major in a particular subject is a usual situation in Government. Those involved in a particular area are bound to press their own suit and they very often, in my view, do not trim in the areas where trimming should take place.
Let me assure the House that full account will be taken of the constructive points which have been made in this debate. Let me repeat once again that my right honourable friend the Secretary of State for Education is determined that the cut in student numbers at the universities will be approximately 5 per cent. in the year 1984–85, as compared with the year 1979–80. Let me again confirm that the slant of the cuts will be in line with the many expressions of opinion from all sides of the House today on the kind of education that this country desperately needs to re-establish its position.

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Very quickly, I shall try to answer the specific points which the noble Baroness, Lady David, raised. The first was about The Legal Basis for Further Education. As noble Lords are aware, as was announced last June in another place, The Legal Basis for Further Education was received by the Secretaries of State for Education and Science and for Wales and by the local authority associations. It has also been issued as a consultative document to outside bodies, and their comments will be taken into account when, in due course, the Government consider their own response to proposals made. The House will understand that it would not be right, and I am not allowed, to anticipate the results of those consultations. I cannot say anything useful in relation to the point on the number of school-leavers who failed to get places in schools, in further educational or in higher educational establishments this autumn. The figures are not yet available.
On the question of ensuring that the additional resources are used for 16 year-olds to stay on in full-time education in schools or in further education colleges, I can say that it will not be possible to be certain of the way the additional money is spent, as it is being allocated by means of the usual rate support grant mechanism. However, the Government welcome the fact that local authorities are already responding to the increased demand for staying on in education. We are confident that the authorities will welcome these extra resources to assist them in what they are doing.
One of these days I shall sum up in the right amount of time. I apologise for not answering all the questions, but I shall certainly try to ensure that written answers are given to some of them.
8.11 p.m.
Baroness David: My Lords, I am quite sure that at the end of five and a half hours of debate no one wants me to make a second speech, and I shall not. But I should like to thank everyone who has taken part. We have had an interesting and lively debate. I thank the noble Viscount, Lord Trenchard, for making such an effort to answer the questions of which I gave him notice. It was good of him to do so at the end of a long speech.
I must confess that in the noble Viscount's summing-up he was I think in a way answering a debate that never was, but at any rate I thank him. I thought there was a certain complacency about the speech of the noble Lord, Lord Elton, but I still believe that education and training of the right sort are what will help to make industry in this country more efficient for the future. My Lords, I beg leave to withdraw my motion for Papers.
Motion for Papers, by leave, withdrawn.