HL Deb 28 March 1984 vol 450 cc234-44

3. 6 p.m.

Baroness Carnegy of Lour rose to call attention to the fact that Britain lives by the skill of its people; to the implications of this for education and training, and to invite attention to the White Paper Training for Jobs (Cmnd. 9135); and to move for Papers.

The noble Baroness said: My Lords, may I begin this afternoon by thanking those of your Lordships who have chosen to speak in what I believe to be an important debate, and particularly by welcoming to the debate my noble friend Lord Forte who is to make his maiden speech and to whom we shall all listen with enormous interest.

There can be few of your Lordships—and indeed few people anywhere in Britain today—who will take issue with the first two sentences of the Government's White Paper, Training for Jobs. Nowadays it is well understood that Britain lives by the skills of its people and that a well-trained work force is an essential condition for economic survival Most people also see with even starker clarity that in modern times the life chances of the individual citizen will greatly depend upon his ability to acquire and maintain up-to-date skills which are wanted in the labour market.

Our national effort during the past three or four years to begin a complete overhaul of our training system has frequently been punctuated—alas, sometimes impeded—by somewhat cynical cries of, "Training for what?" Why should young or older people, it has been asked, be encouraged to equip themselves if there are not going to be enough jobs to go to? Fortunately, the vast majority of young people and their parents—and indeed employers, unions and local authorities—have resisted that particular argument, for nothing stands still. Currently every month 350,000 jobs change hands.

With productivity and growth now improving; with a Budget designed to encourage companies to expand, and tipping the balance of advantage towards the taking on of more people; with more part-time jobs and jobs with shorter hours; and with self-employment now at 2¼ million (400,000 up on 1979), the number of jobs available is beginning to grow and job changes are likely to begin to increase. With this will come the opportunity for workpeople to move from the older to the newer types of jobs and for those who have been out of the labour market to get back in.

Clearly it is of the greatest importance for the economy as a whole and for individuals of all ages that we should press on with the strategy for training which was outlined in the White Paper of 1981 and on which considerable progress has already been made. This 1984 White Paper seems to me to be a realistic document. It sets out in pragmatic fashion what the objectives are. what has so far been achieved, what has now to be achieved and—most importantly—how new forms of co-operation can expedite progress. It shows a broadening of emphasis from the concentration on the 16-year-old school-leavers and their school-to-work bridge back into what goes on in schools and colleges, particularly for 14 to 18-year-olds, where learning for competence must begin, and forwards to the opportunities there are for adults to improve and upgrade their skills as the need arises.

By far the most important thing about this White Paper, it seems to me, is that it shows the world of education and the world of industry at last coming properly together, beginning to talk the same language to the mutual benefit of both and to the great potential benefit of their customers. I believe that once they have studied fully the implications of what is being suggested, those who have responsibility in the two rather separate worlds—teachers, lecturers, local government councillors and administrators on the one hand, and employers, trade unionists, trainers in industry and commerce on the other—will see ahead of them what both lots have long wanted. For industry it is a chance strongly to influence the quality of education and off the job training, and for education a much needed new sense of direction and one with which the public will strongly identify.

Last week, the principal of Edinburgh University, Dr. John Burnett, was reported as saying in a Town and Gown lecture, Education is in a mess and the nation does not know why or how it wants to educate its citizens.

He spoke about how, despite a century of compulsory education, we have to promote adult literacy and numeracy classes; about the increasing truancy, widespread boredom and disillusionment with education in schools. He wondered whether teachers were properly assessed in their ability to teach what was needed. He might have added—perhaps he did but it was not reported—that part of the trouble is that young people simply do not see the connection between what happens in school and what is going to help them get into a job and lead a successful life. That is perhaps partly because universities have tended to dictate the schools' curriculum and for many people it is simply the wrong curriculum.

Industry and commerce tell us, for their part, the kind of grounding which will help young people to do a good job in the modern world. Young people, they tell us, need not only to be good with their hands, competent in a practical sort of way. but they need to have the flexibility and imagination to learn the new skills, learn new ways of working, acquire the analytical ability to cope with a computer terminal, a computer controlled machine. They need the confidence and ability to communicate, to innovate, to use their intuition; and of course employers look for enthusiastic, motivated people.

The developing of these characteristics and the motivating of young people is clearly the job of schools and colleges backed by parents. Curricular changes now under way will help, but they are not nearly enough. An important attempt, I believe, to find ways that work is the pilot schemes being mounted in schools and colleges under the technical and vocational initiative in schools. Here vocational and technical subjects and attributes—computers, design technology, business studies, problem solving, and initiative—are included as part of general education. Work experience is specifically linked on those courses with what happens in school and young people are involved individually in planning their own curriculum. Because this is happening in half the local authorities of England and Wales, in 8 per cent. of all the schools in England and Wales and among 3 per cent. of young people in the 14 to 18-year-old age group, for whom it is intended—and eight local authorities in Scotland have put forward schemes—what is discovered through those schemes will be capable of being disseminated and used widely and quickly. In this initiative, industry must be deeply involved or it simply will not work.

The youth training scheme is undoubtedly involving education and industry in working together as never before. One suspects educators and trainers are learning a lot from one another there, and that that learning will be further enhanced by the review recently announced. The concentration now is on developing quality and especially in linking practical work on the job with off the job education and training. There, young people are not always turning up for the off the job education and training because their experience of it makes them think that it is somewhat pointless. Colleges and other training people are having to ask themselves hard questions about that.

I hope that some of your Lordships may speak about this subject and also about the question of whether the current outcry about the MSC favouring Mode A with employers, as opposed to Mode B on other schemes, is entirely about which mode is most likely to help young people into working life, or whether it is sometimes about disappointment at the ending of some local authorities' and some voluntary organisations' pet schemes, good though they are, and the funding of adult jobs within them.

The youth training scheme is a huge new innovation and is asking a great deal of all concerned. It is being watched with enormous interest by many of our neighbours in Europe. It is sad that still there are people who are trying to frustrate it; that, for example—if it is true, as reported in yesterday's press—the Civil Service unions having finally agreed—to their great credit—to take part in the scheme, find a few of their number blocking a young person's place on the scheme in No. 10 Downing Street.

Of the reform of skills training, including the reform of apprenticeships, I would say only one thing. If one is going to be able to enter skills training at any age with training to standards instead of time serving, then credit must be given to one for past experience, and credit must be carried into future experience.

One is reminded of the story of a young soldier returning from five years of war to find that he could not enter Oxford University until he had spent a year learning Latin, and how Sir Maurice Bowra, then Warden of Wadham, put paid to that nonsense. Knowing of the soldier's distinguished war record, he simply wrote across the application form "War equals Latin" and accepted him.

Likewise—and this I would say to my noble friends on the Front Bench—if the time spent on the youth training scheme is to be dovetailed into skills training, it may be that the limitation on the number of 17-year-olds who can be on the youth training scheme will limit the possibilities for some young people there.

That brings me to the colleges of further education, where much of the off the job skills training, as well as the youth training scheme training, takes place. Some of your Lordships may have heard this week, as I have, from one of the local authority associations, which said that it considers that there is not very much wrong with its colleges, but if there is it has only to be told what it is and it will be put right. In my experience, and I believe in the experience of many other lay people, there is doubt that present ways of working in these colleges will make it easy for them to respond with the flexibility that is to be required.

Like other large institutions, further education colleges tend, unwittingly, to develop their own imperatives, quite often at the expense of the customers they have been created to serve. Courses of fixed duration and prescribed content tend to take insufficient account of the skills that a student already possesses. The timing and location of courses is all too often arranged to suit traditional staff working patterns, rather than what suits customers.

The slogan of the new Open Tech., which offers courses "At a time, at a pace, in a place" suitable to the students' needs, is still not the slogan of more traditional colleges. Too often lecturers become out of date in their knowledge through not having opportunities for, or not turning up at, in-service training. I notice that in its recent policy document the Engineering Council suggests that each year 500 academic lecturing staff should spend up to a year in the engineering industry. All this has been discussed for years, and industrial representatives on college boards, councils and advisory bodies have so far failed adequately to influence the scene.

How are we to get enhanced responsiveness in colleges? I suppose that few of us would give the Government 10 out of 10 for displaying the conventional patience in this matter, but I have a good deal of sympathy with their approach towards funding more places in colleges and for the fact that it was announced before, rather than after, the consultations with the relevant bodies took place. Having myself been present as a commissioner on the MSC at the many months of arguing and feet-dragging in the name of negotiation, which through many meetings held up agreement on the youth training scheme and left so little time to develop quality arrangements, I am not surprised that the Government have done it this way round this time. In fact, the channelling of taxpayers' money direct to funding work-related FE places in colleges, with local employers and others in industry very closely involved, is likely to be of enormous help to colleges and to their customers. I believe that in their heart of hearts local government people know this and that as the dust clears they will find ways that work.

That brings me, finally, to the area where most of all industry and education will come together: the strategy for offering wider opportunities to adults to train and retrain as the need arises. Here there is a need—a very big need—to raise everybody's awareness of the importance of up-to-date skills and how this can be achieved effectively and cost effectively. There is a need to bring together the many resources already existing—local authority colleges, MSC skill centres, adult education and community education centres, and the Open Tech.—to provide work-related training for employed people and for people at present unemployed. All that training must be closely related to employment opportunities in the local area; for it to be realistic employers must be closely involved.

In all this I have not spoken much of my friends and erstwhile colleagues in the Manpower Services Commission. That is because the people who have to bring all this about are those in industry and education, and those in the MSC see themselves in the main as facilitators and catalysts. The MSC are the people who can co-ordinate both openness of access to training and the transfer of credit for qualification and achievement between different parts of the system. They can give practical support for much needed staff development; and they can provide market information, local and national. That is the MSC's role, and it is a very important one.

The need for greatly improved vocational and technical education and training is widely perceived to be crucial for the nation and for the lifechances of individuals. Much is already happening: much has yet to happen if we are to keep up with (dare I say overtake?) our international competitors. John Cassels, director general of NEDO and a former director of the MSC, said recently of training, The creation of a system which will really give the customers what they want is not now primarily a question of resources; it is a question of management".

I can put it no better than that. My Lords, I beg to move for Papers.

3.27 p.m.

The Minister of State, Privy Council Office, and Minister for the Arts (The Earl of Gowrie)

My Lords, I very much welcome my noble friend's choice of Training for Jobs as the subject for debate. No one is better qualified than my noble friend to talk about this issue, in view of her experience as a commissioner of the MSC. The way that she moved the debate speaks for itself. I look forward to the maiden speech of my noble friend Lord Forte, whose great organisation has, I understand, some admirable YTS schemes.

I apologise to him and to the House for the fact that one of the major engagements of an Arts Minister's year is taking place late this afternoon and this evening and I shall have to leave the Chamber during the debate. What is a cloud for me personally has a golden lining for the House generally: my noble friend the Leader of the House is going to wind up the debate. As the House knows, he is a former Secretary of State for Employment and has always taken an enormous interest in this subject. I have been winding up debates for Cabinet Ministers for so long now that it is quite a shock to find the natural order of the universe upset. I am immensely grateful to my noble friend.

Unemployment is the most important domestic issue facing our political economy. This is not the moment to analyse in depth why full employment has left our own and other Western economies; sufficient to say that the fault is both in our stars and in ourselves. There are external circumstances and internal reactions to them. During the 'seventies, where nearly all Western governments were concerned the internal reactions usually compounded the difficulties. An external circumstance was the commodity price revolution of the mid and late 'sixties—a consequence, if you like, of post-war affluence—and the OPEC oil price rises of 1973 and 1979 were the most dramatic instances. The downturn in world trade that followed was almost entirely due to the reaction of individual governments to these shocks. Political economies that adapted very quickly, like Japan, were far less affected even if, again like Japan, they were dependent on outside sources of raw materials.

Governments, in my view, wanted to hide from their electorates the full consequences both of the price rises and of the currency instabilities that such swift transfers of money assets occasion. The money was transferred much more quickly than it could sensibly be recycled. So Governments inflated their own currencies. You cannot get away with that for long. These competitive inflations were therefore followed by competitive deflations. Whether of the Right or Left, governments were all "go" at one moment and all "stop" the next. How vulnerable we all were to the rise of those highly disciplined capitalist economies in the Far East!

In Britain, we for too long compounded these offences with our own peculiar and particular economic foibles—the foible of slowing down inevitable structural change in industry in order to save jobs that everyone knows cannot be saved for long, instead of spending money to ease people out of industries in decline and to train and retrain them for the very different industries of the future; the foible of restrictive practices by powerful organisations; the foible of pay settlements wholly out of line with productivity increases or the need to retain profits for investment. These circumstances and these foibles have taken a terrible toll in the waste and misery of unemployment. They almost persuaded a generation of young people that there was little hope for them. There is hope, and this debate and this White Paper are part of it.

The debate and the White Paper are one pillar of what the Government are doing about the unemployment crisis. The other pillar is, of course, the overall economic strategy—the strategy of neither bringing everything to a halt nor letting everything get out of hand. Central government are spending money, a lot of it, but they are spending what they have planned to spend to meet orderly targets within the framework of what the economy can afford. So business can judge its share of resources, as well as ours, and go ahead and invest and prosper in the knowledge that our currency is more soundly based than for 15 years. Look at the present results of the policy, the situation today as well as the promise of better things tomorrow!

Britain, which entered the recession early and hard is coming out of it more quickly and in better condition than most. The United Kingdom's GDP was 3 per cent. up in 1983 on 1982. The OECD forecasts that growth in the United Kingdom this year will be the highest of any Community country. The most recent CBI survey points to a further rise in business optimism, further increases in manufacturing output, a widening of recovery in capital goods interests and a 7 per cent. increase in investment this year. Have you noticed, my Lords, that nearly all the rows in political life where this Government are concerned—political life in a democracy is largely about rows—are no longer to do with the general direction of economic policy? That is because there is a great deal less to row about. The policy has been working steadily for some time and some of the fruits are beginning to be picked. Witness the abolition of the national insurance surcharge, the tax on jobs, in the Budget.

There is, however, a very big "but". I have sometimes rather shocked your Lordships at Question Time and on other occasions by emphasising that there is no quick or comfortable correlation between overall economic recovery and the restoration of full employment. I wish it were so. But in the modern world, in the Western economies generally, it is clear that it is not so. Modern manufacturing industry is capital not labour intensive. More worrying still, many of the big modern servicing industries are liable to go the same way—the robot confronting the computer, if you like. This is why this debate and the White Paper are so important. As my noble friend has said, we need fast footwork, flexible training and retraining— training and retraining to cope with the new service and manufacturing industries, even the leisure industries, as I know from my work as Arts Minister. These industries and the jobs that go with them come on stream continuously so long as the currency is stable and the wealth that it represents is being created out there in the real world. Training for jobs is our declaration of intent for the young people on whom my noble friend placed such emphasis.

Today's youngsters were born in what now appears to be that antediluvian time, the swinging 'sixties. There was the phenomenon of the baby bulge of the 1960s to which I have to confess that I contributed. The Beatles, your Lordships will remember, at that time sang "I Wanna Hold Your Hand". The trouble was that many of us went considerably further. The baby bulge of the 1960s is now suffering the horrid irony of coming onto a labour market changed out of all recognition by some of the factors I have mentioned. If that was not hard enough, they are coming on to the labour market before the immediately post World War One baby bulge has come off it. These demographic difficulties will ease a little as the decade advances. Witness, for instance, the falling school rolls. But the difficulties for this particular generation will not go away. Training for Jobs is about what we are doing to help them as well as what we are doing to try to achieve faster footwork and adaptability in this economy. I am not sure that I do not believe it to be the most significant document published so far by this Government. I am proud to have played a small part in its conception back in 1981. All credit to the much greater part played by my right honourable and honourable friends, Mr. Tebbit, Mr. King and Mr. Morrison, and David Young and the MSC as well.

Before I sit down, let me point to a few specifics in this overall strategy. The introduction of the youth training scheme has, I believe, secured a permanent improvement in the way that employers approach basic training for young people. The statistics themselves are impressive. Every weekday morning, more than a quarter of a million young people take part in schemes of their choice which they think are worthwhile. The Government's guarantee to unemployed 16 year-olds has effectively been met. In return, I think it is right to expect trainees to play their part and help keep costs down by accepting allowances that reflect the value of the training given. The £25 is not a wage. It is closer in concept to a vocational education allowance.

This very week, I woke up early on Monday to hear the radio programme "Farming Week" reporting on a promising new scheme for agricultural training in the West Country. The particular scheme featured in the programme, which takes place in Somerset and South Avon, involves 300 young people who take part in a variety of agricultural activities, including horticulture, agricultural engineering, food technology and the management of the horse. The trainees spend nine months out on practical work as well as three months on study. Those interviewed on the programme—all of them—were clearly convinced of the merits of the scheme. The organisers expect 80 per cent. or more to find real jobs.

As it happens, I am visiting the West Country myself this Friday. I shall be able to see a YTS scheme in Glastonbury that rejoices in the personable acronym of FACE—the Facility for Arts and Crafts Enterprise. FACE offers trainees a choice of over 140 skills and has placed a large number of young people in traditional crafts occupations as well as providing excellent training. Six of the young people from the first year's pilot scheme subsequently went on to become self-employed glass engravers. Their work is of such excellent quality that it is selling extremely well and the young people have good incomes. Many more trainees hope to enter self-employment on completion of their year's training. Those are just two examples in one part of the country.

The Technical and Vocational Education Initiative in some ways complements the YTS by providing resources to enable schools and colleges to build on existing good practice by experimenting in new and imaginative ways of introducing technically and vocationally relevant subjects to the curriculum. The certificate of pre-vocational education in England and Wales has the same goal of preparing young people for the world of work. The first 14 pilot projects got under way last September, and local education authorities have responded very enthusiastically to our planned extension of the initiative. Sixty-eight authorities in England and Wales submitted bids under the extension, and negotiations are now proceeding with the 45 selected for support.

We then come to the reform of skills training. The White Paper records real progress in modernising skills training. Important changes, as my noble friend reminded us, have taken place in the real world in engineering, in printing, in electrical contracting and in office skills. We must as quickly as possible make time-serving a historical relic, but I confess that there is still a long way to go—much further than I should like—before we reach our target of getting rid of it by 1985. Employers, trade unionists and educationists involved in all sectors of industry have a role to play in achieving that objective with the support and assistance of industrial training bodies, and standard-setting and validating bodies. The MSC is the right body to play, as again my noble friend said, a catalyst role in stimulating and monitoring action by all concerned.

I come to adult training. The White Paper sets out the Government's agreement to the MSC's proposals. Training for adults must also become more closely linked to individual employers' needs. In the past we have so often trained people for jobs that are simply not there. That is in nobody's interests—trainees', employers', the taxpayer's or the country's as a whole. As with young people, training which is responsive to the market is most likely to lead to jobs generally. Future emphasis will be on training for specific job opportunities, particularly in new technologies, as well as training for people who want to become self-employed or to start their own businesses.

While TOPS—the Training Opportunities Scheme—will go on playing an important part in securing skill supply and in providing training for the unemployed, it will concentrate much more than in the past on the provision of skills which are in real demand. A programme of help will be available for unemployed people who need training at a more basic level, particularly to restore employability after long periods of unemployment. This training might be provided through short preparation courses of the type already provided under TOPS, or in conjunction with the Community Programme and the Voluntary Projects Programme. Behind these rather dull titles are good schemes, and I have visitied many of them.

The proposals already accepted will enable over 200,000 people to be trained each year compared with 110,000 under existing programmes. By concentrating on the most cost-effective forms of provision, we are achieving the substantial increase within the £250 million a year, currently allocated to support adult training. That is not skimping; that is good house-keeping: a better service for the same amount of money.

Lastly, I come to NAFE, as non-advanced further education is known. Like dragons on the old map, here be controversy, although I must confess that I should be most suspicious of our document if it did not cause controversy. In the White Paper we have announced new arrangements within work-related non-advanced further education. In developing ways of bringing training and need more closely together, a key area is obviously the vocational education provided within colleges, as well as the training which goes on within industry or under the MSC's programmes which I have outlined.

The Government are already involved here through the MSC, because the MSC currently funds about an eighth of this kind of provision. We decided that a modest transfer of resources to increase that figure to about a quarter by 1986–87 would help achieve our objective of tailoring training and vocational education to the needs of employers. In many areas, local educational authorities and colleges have set up effective and responsive arrangements, and I pay tribute to them. But the position is patchy overall and we need to ensure that the example that the good ones have set, is followed.

Industry and education have a part to play in this. Employers need to pay more attention to identifying and signalling their skill needs. The MSC is uniquely placed to achieve this, combining as it does in its membership, employer, education, trade union and local authority interests. The Government believe that the MSC will be able to act as a positive catalyst for change in this important area.

It is fair to say that the MSC is a little closer to the world of work than is the world of education. I very much hope that the local authority associations and other interested bodies will play their part in the consultations in order to get things right in the interests of those who stand to benefit—the employers and the trainees themselves. I really do not believe that it will be in the interests of anybody—least of all the students and trainees—if those with key responsibilities do not come forward to play a constructive part in the discussions but remain hamstrung by their institutional loyalties.

In sum, the Government are spending more than ever before on training and retraining—nearly £1,000 million this year. For every £1 we spent in 1960, we spend £100 today. But we are not only spending more; we are ensuring that the money is spent more effectively and spent on skills for which there is real demand. Training is an investment and if that investment cannot pay for itself—either because the initial costs are too high or because the training available does not meet employers' needs—the investment will not be made on sufficient scale and training will decline. To go back once more to the Beatles, "We need a little help from our friends".

Because training needs to be employer related it must primarily be an employer responsibility. Industry knows best what training is needed, where and how it can cost-effectively be delivered. Therefore, there has to be a partnership involving industry and commerce, individuals, education and training bodies, and the Government. And employers and trainees must both have a clear understanding that sacrifices in terms of time and money now are an investment for the future of both. I believe that this debate can only increase that needed understanding.

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