HL Deb 15 December 1981 vol 426 cc100-9

3.50 p.m.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Earl Ferrers)

My Lords, with your Lordships' permission, I should like to repeat a Statement which is being made in another place by my right honourable friend the Secretary of State for Employment. The Statement is as follows:

" With permission, Mr. Speaker, I should like to make a Statement on training and special employment measures further to the measures announced on 27th July by my right honourable friend the Prime Minister.

" We have decided to extend the special Job Release Scheme, open to disabled men of 60 and over, until March 1984. Job Release allowances will be increased next April by 9 per cent. At the same time the conditions of the scheme in the public and private sectors will be brought into line. The Temporary Short Time Working Compensation Scheme will also be extended by two years and will then close, with the last application being taken in March 1984. From July 1982 the maximum period of support will be six months. Provision for the Community Enterprise Programme will be increased to 30,000 places in 1982–83. The total provision for these three special employment measures in 1982–83 has now been increased this year by £140 million to over £520 million, with an additional £61 million for the Young Workers' Scheme, which starts on 4th January next.

" Now I turn to training. We have today published a White Paper on the action needed to bring our system of industrial training up to date. We have drawn substantially upon the recommendations made by the Manpower Services Commission in their report, also published today, on the response to the consultative document, A New Training Initiative. The White Paper provides a framework for action by all concerned in industry and education, and sets out the lead the Government are giving in a 10-point agenda. I should draw to the attention of the House three of these points in particular.

" First, there will be a new £1 billion a year programme for unemployed young people which will guarantee a full year's foundation training for all those leaving school at the minimum age and finding themselves without jobs. Over the next 18 months, this entirely new' Youth Training Scheme will progressively replace the Youth Opportunities Programme and will give these young people training in basic skills which employers will need in the future. We are determined to lose no time in reaching the position where every 16 year-old school-leaver is in work, or in further education, or has a genuine opportunity of a year's training. By taking the decisions now, we are able to ask the Manpower Services Commission to ensure that this new Youth Training Scheme is in full operation by the autumn of 1983. Meanwhile, the Youth Opportunities Programme will be expanded and developed to provide about 100,000 of the new-style training places in 1982–83, and the allowance under it will be increased to £25 from next January.

" Young people in the new Youth Training Scheme in their first year after leaving school at 16 will have 'trainee' status. From 1983 they will cease to have eligibility of their own for supplementary benefit, except for the special groups, and so will be treated like those who remain in full-time education. While on the scheme they will, however, receive a training allowance from the Government. This will reflect the value of the training and relevant further education they receive and their learning role, and, although its precise level will be decided nearer the time, it is likely to be something over £760 a year. For older trainees who remain eligible for supplementary benefit, the allowance will be higher, probably around £1,250 a year. These allowances will not apply before 1983 when the scheme comes into full operation, and I am asking the Manpower Services Commission, in working out the detailed implementation of the scheme, to advise on the level of allowances which is appropriate within the resources available for the scheme as set out in the White Paper.

" Employers, trade unions and educationalists have all, rightly, expressed concern for the young unemployed. The Government therefore trust that we can now depend upon their wholehearted support in making this new scheme a success. This new scheme breaks entirely new ground in the training of young people in this country, and it is directed to young unemployed people as a first priority. But our ultimate objective is proper training for all young people, whether employed or unemployed, and to bring more young people into jobs with proper training. For those in jobs, we are increasing the financial encouragement to employers to provide foundation training and release for education so as to cover some 50,000 trainees in 1984–85. We are also continuing into 1982–83 our support for some 35,000 apprenticeships.

" The new scheme I have announced will now go ahead quickly to ensure that there will be universal provision for unemployed school-leavers. But the Government hope that the further study of youth training to be undertaken by the MSC will identify fresh ways in which to help get many more of the young unemployed into paid jobs with proper training. To the extent that their training needs can be met in such ways we would be willing to transfer resources proportionately from the new scheme.

" Secondly, we wholeheartedly support the MSC proposal that employers and unions should accept, and implement, the objective that by 1985 all training should be to standards without regard to age. We shall make Government assistance for skill training increasingly conditional upon steps towards that objective and the removal of unnecessary restrictions.

" Thirdly, we have asked the Manpower Services Commission to develop an Open Tech programme to make technical training more accessible to all with the necessary ability. Other important points of action are set out in the White Paper, including steps to improve preparation for working life in schools and colleges.

" In pursuit of all these commitments we have during this year increased the provision for training expenditure in 1982–83 by £399 million to a total of over £1.1 billion; in 1983–84 by an extra £517 million to a total of nearly £1.3 billion; and in 1984–85 by an extra £648 million to a total of nearly £1.5 billion, including over £1 billion on the new Youth Training Scheme. The provision for 1982–83 is included in the expenditure plans for that year announced by my right honourable friend the Chancellor of the Exchequer on 2nd December. The amounts for later years will be accommodated within the totals to be announced in due course.

" We are therefore providing resources totalling nearly £4 billion over the next three years to bring our training arrangements up to date. With the assistance of the Manpower Services Commission we have now set out a clear framework within which employers, unions, local authorities, education services and trainees themselves can play their part to modernise our training system. These steps are long overdue. Let us set out to provide training fit for a great industrial and trading nation. "

My Lords, that concludes the Statement.

Lord McCarthy

My Lords, we on this side of the House are very pleased to be able to congratulate the Government on some movement in some direction in one area. If this is not a U-turn, if it is not an L-turn, it is at least a departure from the straight, narrow path of monetary lunacy. At least we arc not being told in this critical area that "the best government is the least government." At last the Government have taken on some responsibilities.

I am also pleased to see that what the noble Earl has announced today has been so close to what we read in the papers and what in fact we discussed in this House on 4th February. It is reassuring for those of us who are not in the corridors of power to know that the departure of the "wets" from Tothill Street has had no effect upon the tendency of the department to leak. It is still the case that you can get all kinds of information out of the hollow tree on Clapham Common, [...]ust [...]s you used to be able to do. About that we are very pleased.

We are very pleased, too, that the Government have announced a number of provisions where they have reversed their previous policy; for example, in the area of what might be called short-term job maintenance, the extension of the job release scheme, the continuation of TSTWC—and the noble Earl said that after two years it would stop, but, of course, that is what they said last time; one keeps phasing out TSTWC until one finds that the depression is still there and one then has to keep it running again; but we are glad to see that we are not having TSTWC phased out for another two years—and the further expansion of the Community Enterprise Programme. The only question I would ask the noble Earl on this is: if we are now having an extension of the job release scheme, an extension of TSTWC and an extension of community enterprise, why have so many aspects of this policy been run down in the past and now have to be extended?

It is also right, and we congratulate the Government on it, that they have approved a very large part of the MSC's New Training Initiative in relation to skill training and adult training, although, of course, the noble Earl will know that what the MSC proposed was very expensive, and the Statement today does not tell us very much about where the money is to come from. I want to say one or two words about that before I sit down.

Finally, in the area of congratulation, it is right to congratulate the Government on accepting the MSC's target of 1,000 entrants into the YOP scheme for 1982–83. Once again, one must ask: why has the Youth Opportunities Programme been cut in the past? It is also about time that there was a small, inadequate increase in the YOP allowance of £25.

The real issue, however, and the controversial issue, and the issue which, if the Government continue with their present policies, could wreck the whole of these progressive measures, is what the Government arc proposing for the Youth Training Scheme. The Youth Training Scheme is to replace YOP from 1983 onwards. So we have to ask ourselves: why is it so unlike YOP in so many ways? It intends to be four times the size, it intends to be twice as long and yet it intends to be roughly half the price. In other words, why is it that the allowance for the new Youth Training Scheme is to be somewhere in the region of £15, whereas by that time, if the Government continue to keep the allowance for YOP up to the rate of increase in inflation, the allowance for YOP will be somewhere near £30. So why, when one scheme replaces another, and in a period when the two schemes will be running together, when some members of the same family, for example, could be on one scheme, while others could be on the other, do we have this situation in which something twice as long and four times the size costs half the price?

And why should it be introduced with a threat of withdrawal of supplementary benefit? The noble Earl did not actually read from the White Paper. Therefore, I should like to draw his attention to the first paragraph on page 10 of the White Paper, where the Government say: Those who unreasonably refused a special training place would, like adults who unreasonably refused training offers, have their benefit reduced for six weeks ". My question is: by how much would they have their benefit reduced? My question is: how often would their benefit be reduced? And is it not the case that there is a difference here in the benefit that is reduced when you are training, because that is unemployment benefit, and the benefit in this case, which is supplementary benefit, and there is no alternative to supplementary benefit?

I must say to the Government, as indeed we said in this House when this subject was debated on the basis of leaks on 2nd December: if the Government continue with this policy, if they continue with this cut-price allowance, not only will they have their own Back-Benchers in another place against them; they will have the young people in this country against them, and indeed they will have lost the co-operation of the trade union movement, which the Manpower Services Commission said, in respect of all three of its objectives in the New Training Initiative, is absolutely essential.

4.15 p.m.

Lord Rochester

My Lords, from these Benches I should like to join in thanking the noble Earl, Lord Ferrers, for having repeated this Statement. We have noted the decision to increase to 30,000 in 1982–83 the number of places on the Community Enterprise Programme. But since this is the only programme catering for the long-term unemployed, whose number, I understand, is expected to rise next year to more than 1 million, we cannot be satisfied with the extent of the provision made for them under the programme.

As regards training, we welcome very much the new £1 billion programme for unemployed young people and the guarantee of a full year's foundation training for all those leaving school at 16 without a job to go to. We also strongly support the objective that by 1985 all training should be to standards without regard to age, and also the intention to develop an Open Tech. programme. But we fear that the setting of the allowance for first-year trainees at what—as the noble Lord, Lord McCarthy, has already said—may be the equivalent of only £15 per week, taken together with the element of compulsion inherent in withholding supplementary benefit from young people who are unwilling to participate, means that the consensus that is so badly needed in this field may, without trade union support, be lacking.

Is it not high time, in any case, for consultation between all those concerned, as to how the various related payments that are made to young people, including the education maintenance allowance and the rates for age of apprentices, can be rationalised? Is it not also true that, in their consultative document on this subject, the Manpower Services Commission expressed the view that some statutory underpinning was essential and, now that so many industrial training boards are to be dismantled, are the Government satisfied that the training that is contemplated is capable of being implemented on the basis proposed? Further, are they satisfied that the best of our large companies will prove able, without more financial assistance, to resume skill training that extends beyond their own requirements?

Because in this vital matter co-operation between the political parties is so desirable, I do not wish to strike attitudes today which might later make that co-operation more difficult. But will the noble Earl in turn assure us that, before the Government reach any final conclusions on these questions, they will consider carefully the responses that are made to this Statement and to the White Paper by those of us who, despite our reservations on certain points, are in sympathy with many of the principles on which these documents are based?

Earl Ferrers

My Lords, I am grateful for the welcome which both the noble Lord, Lord McCarthy, and the noble Lord, Lord Rochester, gave. I was heartened when the noble Lord, Lord McCarthy, in his true and generous spirit congratulated the Government on the points with which he feels in favour. As is said in the Statement, I think that this is a radical, new initiative. It has been chosen to try to meet the problems in which we find ourselves today, problems which are caused basically by a recession which affects not only this country but the world. Therefore, it does not represent either a U-turn, or an L-turn, or any other form of turn which the noble Lord would wish to ascribe to it. It is merely the practical application of new resources and new ideas to a very difficult situation, one in which we wish to see young people able to be trained so that they in turn can take part in the economy and the life of this country.

The noble Lord, Lord McCarthy, quite rightly described these as progressive measures. He asked why the Youth Opportunities Programme is so different from this new training scheme. If one may put something in a nutshell, which is always a dangerous thing to do, the purpose of the Youth Opportunities Programme was to give youth an opportunity to work. It did not necessarily provide long-term jobs. This scheme is different. The noble Lord, Lord McCarthy, also asked why the allowance has been reduced. The allowance has to be viewed in the context of this radical, new programme. It is guaranteeing to 16-year-old school-leavers, if they are not in work or in further education, the opportunity of a full year's training programme. So they will be continuing their learning role and will generally be regarded as still dependent upon their parents, like those who continue in further education. Therefore, it is not a strict comparison. The difference is as I have described it. The noble Lord, Lord McCarthy, said that the Youth Opportunities Programme has been cut in the past. In fact, it has never been cut. In 1982–83 it will be updated again to some 630,000 places.

The noble Lord, Lord Rochester, asked whether the Government are satisfied that the training will be available on the basis which the Government have indicated. We are satisfied that this will be so. However, I know that the noble Lord will understand that this is a very fundamental rethink. We published the original document and there have been consultations upon it. This is the Government's conclusion. It will be some 15 months before this programme gets into full operation. During that time it will be the duty of the Government to liaise with all the responsible bodies which will be involved in trying to ensure that this happens. The Manpower Services Commission have got to organise the schemes, interest sponsors, devise training courses, liaise with education authorities. We believe that it will be possible to organise these facilities and that this will come about. I would remind the noble Lord that three months of the training in these new training schemes will be off the job, while about nine months of it will be on the job. So there will be great flexibility.

The noble Lord asked me whether the Government will take into account observations which are put forward by organisations when they have had time to study the White Paper. Of course, we shall take those observations into account.

Lord Orr-Ewing

My Lords, we on this side of the House—

Several noble Lords

Order, order!

Lord Orr-Ewing

Three from the other side and none from this?

Earl Ferrers

My Lords, the noble Lord, Lord Kilmarnock, is a Social Democrat and therefore is not wholly in alliance with the Front Bench opposite.

Lord Kilmarnock

My Lords, we on this Bench also wish to express our gratitude to the noble Earl, Lord Ferrers, for repeating this extremely important Statement. Many of its lines we are able to welcome, in particular its emphasis that all future training should be to standards without regard to age. This is something which those on all sides of the House can welcome.

I have one slight reservation regarding the nub of the Statement concerning young people in their seventeenth year who are to have trainee status, for they are to cease to be eligible for supplementary benefit. We learn that they are to be treated like those who remain in full-time education. The noble Lord, Lord McCarthy, also touched on this point. In the White Paper, which we have not had time to read, we are told that supplementary benefit may be reduced to six weeks if there is an unreasonable refusal of a training offer. This might cause considerable hardship to a family which is dependent upon supplementary benefit. May I therefore ask the noble Earl how the Government are planning to apply this sanction? If a young, unemployed person is offered a place with a particular firm or on a particular course which he or she feels is unsuited to his or her inclinations and abilities and prefers to wait for another opening in a different firm, or on a different course, when exactly will the Government's axe fall, and to what extent? This is rather an important point.

Secondly, in view of the undertaking that those with trainee status will be treated like those who remain in full-time education, what is to happen to child benefit? Will their parents be entitled to this, too? As noble Lords are aware, those who remain in full-time education between 16 and 19 are entitled at the moment to child benefit.

May I also ask whether those who remain in full-time education will receive any more than the child benefit which goes to their parents at the moment? Will they also get the trainee allowance? If not, is this not very unfair discrimination against continuance in further education? Finally, may I ask the noble Earl whether the Government will receive sympathetically the suggestion that we should have a debate on this extremely important subject early in the New Year.

Lord Orr-Ewing

May I ask—

Earl Ferrers

My Lords, I can assure my noble friend that he will get a full opportunity to make his intervention, but it would be helpful if straight away I could answer the noble Lord, Lord Kilmarnock. First I am grateful to the noble Lord for saying that he appreciates that the training should be up to standards. He asked me how the supplementary benefit will work and how one will determine whether or not a person should have his supplementary benefit reduced. The point at issue is that if there is an opportunity for people who leave school to be given a year's full-time training it is not reasonable that if they refuse to take it up they should nevertheless receive supplementary benefit. The noble Lord asked me how this will operate. I am bound to tell him that the benefits reductions will be a matter of judgment and discretion and that it would be quite improper for me to say at this juncture how exactly that will fall. Obviously, however, there will be a system by which those who feel aggrieved or who are in special circumstances will be able to point that out.

The noble Lord also asked me whether parents will still have the child benefit while their children are undergoing this training. The answer is that they will. At the moment child benefit stands at £5.25. This will be available to those who carry on with their training in just the same way as it is available to those who are in full-time education. The noble Lord then asked (a little craftily) whether those who are in full-time education will also be able to get this allowance. This allowance is for those who are not in full-time training and who would have been unemployed but for this new training which will enable them to do something which otherwise they would not have done. It is to replace that supplementary benefit that the allowance is being made. The noble Lord asked whether there would be an opportunity to debate this matter. I am sure that it may be possible through the usual channels, if it is considered fitting, for a debate to be arranged.

4.20 p.m.

Lord Orr-Ewing

My Lords, may I thank my noble friend for that imaginative Statement which he repeated to our House. In the old days the political pendulum used to swing back and forth across this House. It now seems to swing around and around over the other side. I hope that this will not become too considerable a practice because we do want to comment from these Benches as well. I warmly welcome the imagination, the forcefulness and the generosity, so far as the expenditure is concerned, of this scheme. I think that the cost is going to be very large indeed, and obviously the taxpayers of this country will meet much of the bill; £1.1 million next year, amounting to £1.5 million in 1984–85, is no small sum of money.

Will my noble friend and his ministerial friends in the Department of Employment pay particular attention to the advantages of the German scheme, where great accent is put on vocational training? It is an ill wind that blows nobody any good, but I cannot help feeling that we are being forced into something which we ought to have adopted in this country many years ago—that is, craft training and vocational training for all people leaving school, irrespective of where they are going. I hope that we shall get the best points out of the German scheme and any lessons which they have learnt over the years.

May I suggest that it is important that the nation gets 100 per cent. co-operation from firms throughout the country. I would not in any way object to a levy on the total wages bill, because everyone must make a contribution and a sacrifice to this; but if that is to be levied on firms perhaps the Government will consider whether the national insurance contribution should be taken off, and then we can make this constructive suggestion for improving our manpower training for roughly the same contribution that British industry is now making via the less productive national insurance contribution.

Earl Ferrers

My Lords, I am surprised that my noble friend should say that in the old days the political pendulum swung backwards and forwards across the Chamber. Things do change and sometimes the pendulum does go around and around, because what happens on the Benches opposite sometimes changes. Nevertheless I am very glad that my noble friend had an opportunity to ask his question even though he was not able to do so quite as early as he would have wished.

I absolutely take the point about the German scheme to which my noble friend referred. We will of course study what is being done there in order to see whether there are ways in which we can use the benefits which they have accrued in our own country. My noble friend is entirely right when he says that the scheme needs 100 per cent. co-operation from firms. I would go one stage further, because clearly, when the Government make a statement of this nature, there are some facets of it which may appeal to some people and some facets which might not appeal to others; but I would ask those who are interested to realise that this is a positive step by the Government of the day, whatever views one may take. The Government have committed some £4,000 million over the next few years to help in training. Whatever one's opinions may be in respect of individual facets, it is terribly important that employers, employees, firms, educational establishments and everyone else should co-operate to make this scheme successful. There is no reason why it should not be successful but, like everything, it depends on all those involved co-operating to the fullest extent, and I hope that this will be done. My noble friend asked whether there was a possibility that the national insurance contribution could be removed, but I believe that is a little outside the scope of the—

Lord Orr-Ewing

My Lords, I believe I used the word "contribution", when I really meant to say "surcharge".

Earl Ferrers

My Lords, I supposed that my noble friend did mean that and, although he used the wrong word, I got the right sentiment—and I can assure my noble friend that I admire his prowess in getting in a plug. I will see that it is taken note of, but I will give no guarantee either way.

4.26 p.m.

Lord Stewart of Fulham

My Lords, I should like to ask the noble Earl the Minister two questions. First, will not some of the cost of the provision of this training fall upon local authorities, and how are the Government going to help them with that? Secondly, would the Minister not agree that there are a number of young people whose wisest choice, if they cannot get a job at 16, is to stay on at school—not necessarily with a view to university studies later, but to improve their general knowledge and standards of literacy and numeracy—and does it not follow from the answer given to the noble Lord, Lord Kilmarnock, that they or their families will be financially disadvantaged as compared with others?

Earl Ferrers

My Lords, I do not think that their families will be disadvantaged. I absolutely agree with the noble Lord that where people can stay on at school and so increase their knowledge and their learning, that is the best course to take. Where that is not possible, of course, they will be able to come under this present scheme. If the noble Lord says that that is a disadvantage, I think one has to weigh up the advantages of proper full-time further education against the more limited but nevertheless more substantial advantage of the training.

Lord Oram

My Lords, in his opening Statement the Minister gave estimates of the amount of money necessary to implement the training scheme in the next two or three years. In reaching those amounts I suppose that the Government had earlier made an estimate of the number of young unemployed likely to be unemployed in those years. Could the noble Earl give the House those estimates of young unemployed people in those years?

Earl Ferrers

My Lords, it is a hazardous thing for any Government to try to estimate what the levels of unemployment will or will not be six months ahead, let alone two or three years ahead.

Lord Oram

My Lords, but surely the figures which he gave must have some basis on estimates or calculations?

Earl Ferrers

My Lords, the figures which I gave were based on the figures on unemployment which arc available at the moment and which we wish to see reduced—and this scheme is one of the ways by which we wish to see them reduced.

Lord McCarthy

My Lords, before the noble Earl sits down, may I ask him for an answer to the question asked by my noble friend Lord Stewart of Fulham? His question was really about the cost to local authorities. This will undoubtedly mean an additional significant cost to local authorities. Maybe at this moment the noble Earl cannot tell us what the Government's policy on that will be, but if he cannot then surely he should tell us subsequently?

Earl Ferrers

My Lords, I am sorry that I omitted to answer that particular question. Of course there may be some cost to local authorities, but this will have to be determined, to find out what the cost will be. I will look into the matter and will write to the noble Lord. I do not wish to truncate this debate particularly, because I realise there are many people who are interested, but we have been at it for 38 minutes. I dare say that I have been at it for 28 of these minutes and therefore I may have truncated the contributions of other noble Lords; but if your Lordships think it is appropriate, I think we should pass on to the next business.