Training

HL Deb 05 April 1989 vol 505 cc1135-62

5.29 p.m.

Lord Rochester rose to call attention to the changes which Her Majesty's Government are seeking to effect in this country's attitude to training; and to move for Papers.

The noble Lord said: My Lords, I am privileged to speak to the Motion standing in my name on the Order Paper. It has been prompted by a recent article by Dr. K. B. Everard who was at one time head of education and training at ICI. I am also indebted to Mr. Basil Murphy, Director of the British Association for Commercial and Industrial Education, for his contribution to what I wish to say.

It is plain from the White Paper, Employment for the 1990s, that the Government aim in their proposals to effect what may reasonably be called a cultural change in the nation's approach to training. They should certainly not be reproached for that aim but, in my view, they are to be criticised for the way in which they are going about it. The White Paper exhibits an impoverished conceptual understanding of how to bring about change.

The document outlines a new structural framework for training nationally, but not a strategy or policy involving Government, employers, training providers and others. The New Training Initiative of 1981 was widely seen as a national training strategy and employers, trade unions and educational and training organisations were all involved in its formulation. I believe however that there is only one passing reference to it in the White Paper. When the noble Earl, Lord Dundee, replies to the debate—I have given him notice of this question—perhaps he will be good enough to say whether that initiative is still in place, whether it has been superseded by the principles enunciated in Section 4 of the White Paper or whether a policy has yet to be determined within the framework now proposed.

In 1989 one would hope to find in such a document some recognition of up-to-date processes such as that in ICI, with which I was involved in the strategy, for gaining acceptance of change. The extent to which the paper relies on rhetoric suggests a command model inappropriate for its purpose. The point seems to be recognised in paragraph 5.17 which states: It would be wrong to impose from the top a national structure, and to suppose that this would capture local support and local energies". The rest of the document hardly suggests that that statement carries conviction with the Government.

The paper is written as though the only people in need of training are those in industry and commerce. For instance, paragraph 4.21, dealing with the need for standards and recognised qualifications based on competence, states that the Government's objective is to see standard-setting bodies established thoughout industry and commerce. Why is there no expression of a similar desire for the Government's own employees?

The Government's view is that local delivery of training should be employer-led. But how should "employer" be defined? The White Paper seems to ignore the fact that the wealth-spending public services can and should contribute just as much as the business sector to our prosperity by becoming more effective. We are all part of a complex, interdependent society in which the public services, including national and local government, should promote a training culture like everyone else. Yet the White Paper contains hardly a mention of what still needs to be done in those services. Indeed, we read in paragraph 6.20: Developing training through life is not primarily a Government responsibility". It certainly is.

Under the leadership of Sir John Harvey-Jones, ICI's change programme began to bite only when head office was seen not to be exempt from it. Credibility is lacking if, in such a strategy, there is no acknowledgement that its originators are also in need of reform. The Government are the initiators of the programme that we are discussing. And they are at least as much a part of the problem as wealth creators. About the only indication that that point is recognised comes in paragraph 6.27 of the White Paper which states: Twenty Government Departments have already joined the [management] Charter Initiative, reflecting the need for professionalism in management in the public service as elsewhere in the economy". Within the new framework, training and enterprise councils are to be established at local level to plan and deliver training. It appears that they are to be staffed and run by employees of the Training Agency, the latest national body to have been set up in that field. Given the lack of expertise in training matters of senior executives in industry, who are largely to comprise the councils, and their understandable preoccupation with other duties, it will no doubt fall to those agency employees to provide the professional support too. In that case, can the councils really be deemed to be employer-led?

For some years, I was chairman of one of the old district manpower committees set up to advise the Manpower Services Commission, as it then was, on training and employment problems in the localities. It was no fault of the people who serviced those committees that they had neither the managerial competence nor the training experience needed to help effect change. I do not suggest that the new councils should be packed with professional trainers, but I believe it is important that, independently of the Training Agency, the councils should have access to experienced professional advice. On that point, is it helpful that local representatives of education and of trade unions should be given only such a minor role in the partnership about which the Government talk in the White Paper's concluding paragraph?

There is also the demographic problem. That will affect recruiting and training, not simply where young people are concerned, but right across the working population. It will necessitate a vast on-going programme of retraining. Where are all the trainers to come from and who will train them? The Government should encourage a massive expansion of training resources as members of the partnership that they have in view.

The conclusion of paragraph 4.45 is that the training system must co-operate with the education service—not the other way round. Does that imply that the education service has all the answers and is less in need of relevant training than everyone else? It is significant that, while a lead body for training and development is already in place, there is no equivalent for education or, better still, a single body for learning. As has been aptly said, education and training should be presented as a seamless robe.

The principal premise of the White Paper is that employers will now see the training and continuous development of their people as of cardinal importance and that investment in people is of greater long-term benefit than investment in hardware. Alas, history, and indeed the reason why this White Paper has been produced, hardly support the premise. In my experience, good training takes place in organisations when there is pressure within the system to make it happen, such as a leader who is demonstrably interested in the development of the people whom he is leading. Surely there is a role for government here. The levy grant system has been tried and, some would say, found wanting except perhaps in the special case of the construction industry. What about tax benefit? It appears to work in the United States and France. Might it not be tried in this country?

The other day I was interested to learn from the Engineering Industry Training Board that Hilary Steedman of the National Institute of Economic and Social Research has done a great deal of comparative work on industrial training in France and the UK. She regards the level of achievement of French craft and technician trainees as significantly higher than that of their British counterparts. She also considers the system of publicly funded training in France to be a major contribution to the high level in both quantity and quality of engineering training. Interestingly, young people in the 16 to 18 age group have effectively been eliminated from the French labour market; they no longer provide a pool of cheap labour. In the improving employment situation in this country it is high time that the Government took effective action to ensure that here, too, the years between 16 and 18 are treated as a period of training and education for all.

I have already acknowledged that the Government can fairly claim to be trying to effect a cultural change in this country's approach to training. They are planning to do it by means of new systems and structures. Structures can help, but attitudes are paramount. I suggest that the approach of the White Paper is mechanistic. Knowledge and skills are one thing; attitudes are quite another.

Like Dr. Everard, of whom I spoke, I favour the American definition of a competency as, an underlying characteristic causally related to superior performance on the job". So defined, competence embraces personal qualities such as purposefulness, creativity, drive and concern to evoke positive energy and commitment. Education and training should turn people on and not just give them a vocational qualification. It must be doubtful whether schools and universities—I speak as one who until recently was chairman of a university council—are quite as good at achieving that as some of the leading agents and consultants in the private sector have proved to be. Therefore, it is vital that the skills and experience of such people should be fully used.

Paragraph 6.19 of the White Paper rightly states: Everybody can benefit from training. Nobody is too old, too junior or too senior or in too specialised a job". Be they ever so high, that presumably includes senior civil servants and politicians such as ourselves.

If I am challenged to say what kind of training is required for the management of change, I can respond only by drawing on my own experience. It includes training that provides for analysis of the qualities that are needed for leadership. Perhaps I may suggest a few of those qualities: the ability to formulate objectives that are clearly defined, understood and, so far as possible, accepted by those required to implement them; identifying and making use of the talents of all those engaged in the enterprise; knowledge of factors such as responsibility, achievement and the recognition of achievment that motivate people to give of their best; and understanding the effect of one's own behaviour on other people. It means enabling those who have to manage change to identify, confront and overcome obstacles based on such things as fear and habit that stand in the way of what they are aiming to achieve. It involves training in joint problem-solving and much else that there is no time to mention now.

It is right that I should conclude on a note of humility. The problem that we are discussing is complex and of long standing. It is far easier to analyse than to solve. However, in my experience, the best hope of solving it at last lies in working together to ensure that all those who have a contribution to make can share in the enterprise. My Lords, I beg to move for Papers.

5.45 p.m.

Baroness Carnegy of Lour

My Lords, the House will be extremely grateful to the noble Lord, Lord Rochester, for giving us the opportunity of this short debate and, if I may say so, for the way in which he has so clearly set out the issues and his concerns against the background of all his experience in this field. I agree with much that he has said. I am sure that no speaker in the debate is likely to disagree with the somewhat bland but absolutely true definition of the aims of the White Paper as set out in the foreword, in which the Secretary of State for Employment states that: we must invest in the skills and knowledge of our people and build up industry's skill base, through a strategy of training through life, to enable Britain to continue to grow and to generate jobs". The Government's plans for the new framework for achieving that aim are on three levels. I shall confine myself to commenting briefly and in a rather general way on the key proposal to which the noble Lord specifically addressed himself; namely, the proposal to ask private sector employers to take the lead role at local level in assessing local training needs and in planning and delivering training, including that provided by government training schemes. The noble Lord was kind enough to send me a copy of the article from the journal Transition, to which he referred from time to time in his speech. In that article the author, Dr. Everard, certainly questions strongly whether the Government's approach is the right one. He feels that by exhorting employers to improve their ways and by using what he describes as a "command model of change"— that is to say, putting responsibility fairly and squarely upon the shoulders of the private sector—that approach will be limited in its effect. He says that it is: far better to lead by example and build up pressure between managers in the public service and the business sector so that they vie with one another to perform more effectively and apply modern training approaches to that end". I understand what Dr. Everard says. It is a laudable aim, but I truthfully doubt whether we have yet reached a point at which that could be achieved to any major extent, or at any rate achieved with any rapidity. The two sectors think and act so differently and their motivation is so different that, in my view, to get them to vie with one another in the way and to the end described would take a great deal of time and, I should have thought, not a little political negotiation. In this matter time really is of the essence.

Training needs are changing very fast. As the facts and figures set out in the White Paper make abundantly plain, we are now moving into a period when, if industry is to stay competitive and work people are to be capable of doing the jobs required of them, it will be of the utmost importance that firms large and small invest much more in training, that workpeople understand better the value of training to them as well as to their firm and that the training which is arranged locally is the right training for the jobs in that locality.

Many firms are already convinced. Anyone who has been involved in the National Training Award over the past year or two—as the noble Baroness, Lady Turner, and I have been—will have been impressed with the number of firms, from the largest to the smallest across the country, which have proved to themselves how training can transform their commercial success. However, too many firms do too little. Many small firms—where increasing numbers of people work—and many people who work for themselves, do not involve themselves in training and can find no suitable training in their local area. This, combined with the fact that fewer young people will be coming on to the labour market so that new and constantly changing jobs will have to be filled by older people who are as yet untrained, or trained for something else, means that firms which do not train and retrain will become uncompetitive and simply die.

In his article, Dr. Everard remarks that the White Paper proposals, epitomise the wide conceptual gulf between the Government and successful companies about ways of making desirable things happen". That may be, and often is, the case. But is it so on this occasion? Surely, by proposing that urgent change and improvement in training should be led by a group, two-thirds of whose members would be local private sector employers and one-third people from the world of education, trade unions, voluntary organisations and the like, the Government are seeking to bridge the gulf. They are doing more: they are proposing to walk across the bridge and to accept the culture of those on the opposite shore.

In proposing the new training and enterprise councils, the Government are surely saying, "We accept that we, the Government, and local government, as public sector employers, for various well known reasons can often move only rather slowly and ponderously. We accept that what is needed locally at the present time is something nearer the ways of successful private sector firms. Swift responsiveness is needed, flexibility, and a pragmatic approach, without which attributes private firms cannot survive." The Government seem to be saying, "We accept that you people from industry and commerce have long been impatient with our government ways and the ways of our tripartite quangos. We know that you have envied the German employers who control their own training system and who jealously guard that right. So here is the chance to take the lead yourselves and to do it your way with your laudable sense of urgency, freedom of action, and ability to be quick on your feet."

The Government would say this to the noble Lord, Lord Rochester, as well as to the world in general. "Of course the training needs of your area will include the needs of the public sector as well as private sector employees. The training you will be providing will be across all sectors. But it is your private sector dynamic which is to form two-thirds of this managing group. It is up to you to get things going: training in firms and by firms, local delivery of YTS, employment training and other government schemes, working with schools, colleges and voluntary organisations and the rest."

Will it work? I believe that, if local employers will rise to the occasion—and it is very much in their interests that they should—it will work. There is of course the question of how big the areas covered by each TEC should be. Private sector employees are anxious that their time and effort should be used economically by working with areas which are large enough to be economic with time but still small enough to be local.

At a recent meeting of the Scottish Grand Committee in Edinburgh which discussed the Scottish White Paper that has to be read along with this one, but in which employer-led groups are also the key, the Labour Party's Scottish employment spokesman, Mr. Henry McLeish, was reported to have expressed the view that councils, unions and educationists were probably better equipped to decide on training issues than industrialists. I do not think that I agree with that, but I expect there will be people who do. Whatever criticisms are made of the scheme, whatever is said in defence of the status quo, and whatever changes are recommended—and there are many that might be; the noble Lord has suggested some of them—I hope that the Government will stick to the broad thrust of this part of the White Paper. I believe on the evidence of the problems that have increasingly beset the 1981 style of working, on the evidence of the German system for training, and on the evidence of discussions among employers at which I have been present recently, that this part of the Government's plans is a workable way ahead.

5.56 p.m.

Baroness David

My Lords, I should like to congratulate the noble Lord, Lord Rochester, on his good fortune in initiating this debate at such an opportune time, only three weeks after the breakfast-time launch of the training enterprise councils—a launch in four cities with live video links, coloured lights and music, I am told.

It is about training enterprise councils that I wish to speak. They are to deliver the government training schemes, taking over responsibility for YTS, ET, the Business Growth Training Scheme, Small Firms Service and Enterprise Allowance scheme. They will also work on separate initiatives to improve training or ease labour market difficulties.

I am interested in how these initiatives from the Department of Employment and Mr. Norman Fowler link with the activities of the Department of Education and Science and Mr. Kenneth Baker, who, less than a month before that extravagant launch, was making a speech on "Further Education, a New Strategy", to the Association of Colleges of Further and Higher Education. It was a speech evidently meant to be of importance since it was printed afterwards as a glossy brochure. The aims were evidently very similar to those of the TECs: the enhancement of the skills and training of those over 16 and preparing them for the labour force—the skilled labour force we so desperately need and have so signally failed to produce compared with our neighbours in Europe and Japan. Mr. Baker made no reference to the TECs in his speech. What liaison has there been between the two departments, I ask the Minister?

I should like to hear from the noble Earl about the extent of local authority involvement in the new set-up. Eighty to 100 of these TECs are proposed across the country The TECs will be controlled by a board of between nine and 15 directors who will be there in their own right—not as representatives of employer organisations such as the CBI, the Institute of Directors, or chambers of commerce. Therefore no substitutes or alternatives will be allowed at meetings. We have heard that two-thirds will be private sector employers, at the level of a chairman, chief executive or top operational manager at local level of major companies. They, should command support in the business community across the whole of the area to be covered. The other third will be made up from among chief executives or their equivalents in the public sector, again selected as individuals in their own right.

The noble Lord, Lord Rochester, commented on the make up of the board, as did the noble Baroness, Lady Carnegy, but taking rather different lines. Will these people, forming the two-thirds, come forward? Local authority representation will clearly be very limited. Principals or chief officers may have an education seat. It is not clear whether elected members will be weclomed by the Secretary of State, who will oversee all appointments. Perhaps the Minister can enlighten us upon that. The whole set up, locally based, seems very like an alternative to local government. The need to set up channels of communication is emphasised throughout. But lines of accountability are not clearly drawn. May we hear something about how that will work?

For all the references to partnership and community, the TEC prospectus makes very little mention of how the TECs will work with the statutory providers. Although the TECs will not have responsibility for work-related further education funding, for the careers service or for TVEI, the breadth with which their remit has been drawn implies that LEA responsibilities cannot remain unaffected by their activities. There is an explicit clash with the Education Reform Act, where the authority is given the responsibility for setting the strategic framework for the provision of further education in its area, and, as DES Circular 9/88 makes clear, it, determines what changes are needed for the existing broad pattern of provision in order that it meets the changing needs of the population". I should say a word about the funding for work-related further education. The argument that it should now be restored to LEA's main programmes is now very strong. This year's Public Expenditure White Paper unexpectedly showed a cut in the budget for the Department of Employment's training agency from £117.5 million to £112.5 million. Only four LEAs in England and Wales will get increased funding from this source in this financial year. One of the main justifications put forward by Ministers for the transfer of resources in 1984 was the existence of MSC as a semi-independently operating, fast-moving quango. Now MSC has been abolished and the training agency is simply a part of the department. Further, as LEAs are having to recast their planning in order to meet local management and other requirements of the Education Reform Act, it makes even less sense that there should be a sub-plan for that part of work-related FE which is funded through MSC's pale successor body. Some of Mr. Baker's speech to ACFHE could mean that he was intending some changes, including restoration of the FE monies to DES-led main programmes. Is that so?

The question we have to ask is whether the TEC initiative is likely to redress the lack of suitable training provisions in the United Kingdom. It will not provide a responsive vocational education and training system which is so urgently needed to raise skill levels. The same British companies which have so ruthlessly cut back on training provisions for their own employees in the last decade have now been handed £2 billion of public money and told to take care of the nation's needs. The number of apprentices in Britain has plummeted from 272,000 under Labour to 93,000 in 1988. The Tories have ended the training levy, abolished most of the industrial training boards and cut the number of skill centres by a third.

British companies spend about £350 million on training, 0.15 per cent. of Britain's labour costs. This can be compared with Germany, which spends 2 per cent. Japan produces 15 times as many qualified technicians per head of population as the UK. Is that a good omen for the new enterprise councils, so-called? What can we expect?

Like the noble Lord, Lord Rochester, I suggest that there is still a strong argument for either positive tax incentives or legal compulsion on employers. The TECs are essentially a voluntary structure and there is no obvious reason why employers at large should be stirred by them into a far greater commitment to training. The MSC published in 1988 a guide to the existing tax position on education and training, clearly showing the present possibilities, which, for companies, basically mean that they can offset against tax donations which they make to appropriate bodies or some of the costs which they incur in securing training for employees. What the booklet well illustrates is the very restricted nature of the reliefs for individuals and the limitation of offset to the total costs of provision; that is to say, a disincentive against providing is removed but there is no actual incentive to make the provision.

The other way of tackling the general shortage of training available to employees is to give them a statutory entitlement to which the employer must respond. Perhaps present Ministers would not favour such an approach because it smacks of control on private industry. But the situation surely demands it.

I should like to ask the Minister where the national vocational qualification and the National Council for Voluntary Qualifications fit into the new scheme. Mr. Baker dealt defensively with the subject of vocational qualifications in his February speech. He said that NCVQ "is going to deliver". As it is two and a half years since the review of the vocational qualifications and the establishment of the NCVQ with a White Paper and some confident statements about the future, the accreditation of only 83 qualifications in that time—reported in Hansard of 14th February—seems a modest achievement. The White Paper carried a hint of compulsion: The Government will not hesitate to act should it appear that legislation is necessary to make the NVQ effective". The nonsense of the separation of education and training is illustrated by NCVQs having an industry-led lobby for training development but not yet one for education, or one for both as the noble Lord, Lord Rochester, said. Is that to come?

I remind the Minister that Section 120 of the Education Reform Act echoes the splendid assertion of the Industrial Training Act 1964 that: The facilities for further education that may be provided by a local education authority … shall be deemed to include and always to have included facilities for vocational and industrial training". What we want to hear is how much the two departments, the Department of Employment and the Department of Education and Science, are co-operating. Where is the responsibility for the funding for the educational side of the training to lie? How much are local authorities, and more particularly LEAs, to be involved in the planning and delivery of the training that we all agree is so badly needed. The LEAs have a background of solid achievement in increasing access to further education and progressively extending its coverage. Mr. Baker seems at last to have discovered its worth and its possibilities.

If the local promoters of the TECs acknowledge the contribution that the local authorities can make, a beneficial partnership can develop. Locally, employers may realise the need for a partnership of equals. The TEC prospectus apparently does not, and local authorities will require assurance that good relationships locally will not be overtaken by the application of policies and perhaps prejudices held centrally. I understand that next week the Director General of the Training Agency will be meeting some people from the local authorities. I hope that the points which have been made in this debate, including those I have put forward, will be appreciated and that notice will be taken of them.

6.7 p.m.

Lord McCarthy

My Lords, as has been said by previous speakers, we are all in the debt of the noble Lord, Lord Rochester, for beginning and launching us on this debate on the training aspects of the White Paper. So far it has been a very good debate. I have agreed with almost everything that has been said. Nobody can disagree, I should have thought, with much of what the noble Lord, Lord Rochester, said about the role of the Government in training, and some of the criticisms he made (which I want to echo) about the role which the Government see they have in relation to the future of training. I also agreed with much that the noble Baroness, Lady Carnegy, said about the need to expand training, particularly for the small employer, and the difficulties we have had in the past in getting small employers to take their share of training. I agreed with everything which my noble friend Lady David said, and I look forward with great interest to hearing the Minister answer some of her questions.

Essentially what is being said this evening is that we think the Government have the right objectives. However, we have doubts about whether the Government have the right methods. One must ask employers to spend more per head on training. Of course £18 billion a year is a fraction per head of what is spent by our other major competitors. Of course the employers have to spend more. Of course the Government are right to say that there must be an improvement in the quality of training and prescribe standards and external tests.

Training in future must focus on post experience and on the seven-tenths of the labour force which will still be there in the year 2000. That will be the Western Front of training over the next 10 years. However, as the White Paper states, the education system must be more orientated to work preparation, to the relevance of what is taught in schools and colleges, and to what is required when people enter the world of work. All those objectives are right.

The problem is the Government's attitude not to employers but to themselves. It is their attitude to their functions. First, I believe that the Government are abandoning the ship and bailing out. They are creating many objectives for employers, but they are not providing the means by which employers can be expected to carry them out. Secondly, they are creating a bizarre, overlapping surge of institutions, as was said by my noble friend Lady David. It is a cross between snakes and ladders and frivolous pursuits. If one tries to work out the responsibilities and duties of the different bits and pieces of the institutions which the Government attempt to create, I suggest that it is a maze and a confusion.

We must say that they are abandoning ship. After all, what can one think when one reads in Employment for the 1990s at paragraph 4.2: As unemployment falls the level of Government funding can be expected to adjust accordingly"? In other words, it will fall. employers and individuals must accept a correspondingly increased responsibility". In other words, it is "more and more for you boys, and less and less for us".

My first question is: what is the rate of the rundown? We are now spending approximately £3 billion on training, according to the White Paper. That is 16.5 per cent. of what is spent by employers. What is the rate of the rundown? When will it fall to £2 billion and £1 billion? When will it fall from 16.5 per cent. to 10 per cent. and 5per cent? Will they bail out completely if unemployment falls enough?

What are we to make of the dismantling of the rest of the Industrial Training Boards and their replacement by the non-statutory talking shops? They have no powers to raise levies or to force anyone to do anything. What are we to make of that situation but bailing out? What are we to make of the fact that the Government are leaving alone the construction ITB? The reasons they give for doing so—high labour turnover, a large number of small firms and a great deal of self-employment—would apply to a large part of distribution, hotel and catering. If those are the reasons for leaving alone the construction ITB, I ask the noble Earl: why not leave in place some of the other institutions?

What is the evidence that where the ITBs were abolished in 1984—the White Paper states that they have not come up to scratch—that resulted in skill shortages being met? What is it about the record of the Skills Training Agency which makes it ripe for privatisation? The Government say that it does not make a profit. It was never intended to make a profit. The Government say that some of the places on some of its programmes are not full. Perhaps they are too expensive. The whole notion of the Skills Training Agency, or the skills centres, was that it would fill the gaps. They would provide the training that industry could not be expected to provide for itself; that is the non-commercial training. Therefore, how can the non-commercial nature of the Skills Training Agency be taken as a reason for abandoning it and sending it out to privatisation?

One knows what the noble Earl will say. In the White Paper the Government have advanced three justifications for bailing out and for abandoning ship. First, only if they abandon the scheme will the employers accept their responsibilities. That is what the Government tell us. Secondly, way back in 1969 we tried to lead training by government sponsoring. Thirdly, employers in other countries—such as Japan, the United States and Germany—operate such schemes autonomously without their governments spending as large a proportion of the total spending budget on training as we spend. Those are the justifications put forward by the Government.

There are several things to be said. First, we know that British employers are congenital poachers. We know that they believe that it is not worth training if they can poach from other people. We know that that has always been the case. We know that, historically, we never went the way of most other European countries in following the German model after the First World War. We could spend a great deal of time debating that subject; but that is not the critical point. The critical point is that there is no major indication.

The Government do not put forward any evidence to show that there has been a change in the basic approach of the great majority of employers to training. The attitude is: train as little as you can. Most employers in this country believe that it pays to train only if one is both a market leader and a wage leader. They may be right, as they see it, in the short term. It is thought that if you pay more than other people, nobody will poach your labour. But if you are not a wage leader and market leader—as is IBM—there is little point in training because all you will do is spend your money, and other people will poach your labour.

What is the evidence to show that there has been such a major change in the attitude of British employers outside the areas of the ITBs so that the Government can afford to abandon training and run down the expenditure as unemployment falls?

The second defence is: we tried it all in the days when we had the training levy. There are three points to be made about that. First, at its most expressed form the training levy lasted for fewer than five years. In 1973, five years after it was up and running, it was as a result of considerable pressure from those who refused to avail themselves of the moneys that the Government turned and ran and allowed firms to be excluded from the levy. They allowed the exemption system, put the cap on the levy and the whole system reversed.

Secondly, it is true, as the Government say, that the ITBs: did not succeed in raising standards and quantity to the level of major competitors". In five years, my Lords? Is a 300 per cent. increase in the volume of training in five years to be the test of our training levy system? The post-1974 system—the emergence of the voluntary system—has not succeeded in raising the standards and quantity to the level of our major competitors. If anything, most people believe that we are even further behind.

Thirdly, the return to modest centralisation under the MSC in the 1970s might have made a major impact were it not for the fact that it became increasingly embroiled in special programmes and employment initiatives. Therefore if we had received the kind of public involvement and commitment to sponsoring training and providing the institutions in schools and afterwards, such as existed in Sweden, France and Germany—if we had received that for a fraction of the time; say, for only 20 years let alone 40 years—it might have been said that the levy system had failed. But that cannot be said in the time that has been available.

The third defence of the Government is that there are countries, such as Japan and the United States, where employers accepted those responsibilities from the beginning; and there the great majority of expenditure is employer-led. There are several things to be said about that. First, the figures are notoriously elusive. The Japanese have their usual invisible subsidies, their incentives and their buried tax allowances. They have them for training as they have them for everything else. In the United States much of the public expenditure on training is buried at state and municipal level and does not appear in the federal figures.

In Germany, in most of the calculations on public expenditure on training, the spending of the Federal Office of Labour, which spends out of the unemployment benefit, is not listed in the figures. It is very doubtful whether those three countries or any other major country spend less on public training than we do. In any case, they are doing so from a much higher base over a much longer period. If we could show that our employers were as committed to training as theirs, we might begin to relax the proportion of public involvement in training.

Finally, I turn to the institutional mess which I consider the Government have made, so far as I can understand sections 4 and 5 of the White Paper. In case the House should think it over simple, I should perhaps say that this only applies to England. The position is much more complicated in Scotland, Wales and Northern Ireland. In England, we do not have three levels, as the noble Baroness said; we have five, six or seven levels. At the top there is the Secretary of State. He has drawn back some powers from the MSC although it is not clear how many. Underneath the Secretary of State there is the Training Agency, formerly the Training Commission, formerly the Manpower Services Commission. Underneath the Training Agency, or maybe alongside it because it is not clear, we have the national training task force (the NTTF) complemented, parallelled and related to the work of the NCVQ and the NCITO which brings together all the voluntary training boards. Underneath that third level there are the remaining ITBs. Alongside those ITBs we have the new non-statutory ITOs. We do not know how many ITOs or ITBs there will be, but at least one will remain. We do not know when the ITOs will replace the ITBs or what the relation ship will be between them. However, that is only the fourth level.

At the fifth level we have a hundred or so of the new training and enterprise councils. Why there are to be twice as many as the old agencies from the Training Agency, I do not know. But, of course, the local agencies of the Training Agency will still be there in case the training and enterprise councils do not cover the whole country. Therefore, there may be 150 bodies, or there may be fewer.

Underneath those five levels we have the actual providers of training. None of the others provides training. At the bottom we have the people who provide the training and who probably make the money out of it; namely, the contractors. They will be contracting to one or other of those five levels in England. It is much more complicated in Scotland and Wales, and I do not understand the Northern Ireland situation. If one wants a seventh level there are the actual trainees who sit at the very bottom and receive the training.

I suggest that that is much more complicated than it was at the time of the MSC, the ITBs and the original legislation. One can see that it is a mess—a remarkably similar mess administratively to the White Paper on education. There are many resemblances too to the administrative mess in the White Paper on the National Health Service and elsewhere.

This is what results when you apply three simple tests: there is nothing in it for the trade unions and tripartism is done away with; there is nothing in it for local government which does not vote for us; there is as much room as possible for superannuated employers who, hopefully, think like us. Whether you get them and how good they will be depends on how much you pay them. Why should a thrusting entrepreneur or a wealth creator who is any good in a Thatcherite society spend his spare afternoons sitting on enterprise councils? He must be a fool. He cannot believe his own convictions. He may send his grandfather. It all depends on the rate.

Fourthly, the whole thing must cost less than before. It must all help to reduce the national debt to vanishing point. Our argument and that of the noble Lord is that training is far too important—far too important for all of us—to be messed about in this way.

6.25 p.m.

Baroness Seear

My Lords, it is always a pleasure to follow the noble Lord, Lord McCarthy, although his is not on all occasions an easy act to follow. Today is one such occasion. The debate has two very important facets. Why do we need a change of attitude towards training? And how are we to get it?

The burden of what I wish to say is that I do not believe that the Government's proposals, neither their White Paper nor their whole approach to training, begin to measure up to the size of the problem we face. That is why, first and foremost, we need a change of attitude. That change, as the noble Lord, Lord McCarthy, said, needs to start at the top with the Government so that they get a totally different idea of training needs and how they should be achieved.

We need more and much better training. We need more because the level of training which has gone on for years among our competitors means that they now have a far better trained labour force than we have. Of course, they are continually improving their training. It is not as if they stand still and conveniently wait for us to catch up. They are going ahead all the time while we are still fiddling with the problem. Indeed, as implied by several speakers, in the view of many we are going backwards. Therefore, we have the problem of competition in training and a horrifying backlog of untrained people in our labour force. This stems from our neglect of training in the past and through embarking upon improved training programmes which have undone the good brought about by previous changes when we should have waited to see whether those programmes would deliver the goods.

We need far better training for those coming out of our schools. We do not want—I disagree with the noble Baroness, Lady David—to go back to the old apprenticeship scheme. We need to go on to something far more appropriate to what is required in the industry and commerce of today and tomorrow. The problem is not that we did not have enough apprenticeships; it is that we have not developed the new styles and ways of training which modern industry requires. That is what training boards were beginning to do very successfully before the ground was cut from under their feet.

In a remark made extraordinarily shortly after he had put through the Education Reform Act, Kenneth Baker said that the years between 16 and 18 should be years of training and education and not years in which youngsters were being used as part of the labour force in the ordinary sense. Why he did not consider that when the education Bill was going through and incorporate that into the Bill passes my comprehension. It is a development we should like to see. However, we do not see it in the training White Paper. Why is it not there? I suppose it is because the Department of Education and the Department of Employment are unable to get together to decide what they really wish to do.

We need to pay a great deal of attention to the training of people who have not had training in the past. I refer to that large section of the adult population which, with the demographic changes, the expansion of industry and the opportunities available from the opening up of Europe, will need to be trained. Adults will need to be trained. The employment training scheme, although it has some merit, is certainly not adequate to deal with the demands and need for training among the adult population. Not least, may I add, we need to give far more training to the many women who would like to go back into the labour force if adequate training is available. The need for an increased quantity of training does not seem to be reflected in the Government's proposed programmes.

It is not only a question of quantity but of the quality of the training process. As I listen to people who appear to think that they have some knowledge of training, I am horrified at what they think passes for training. The Government do not seem to understand that training today has become a highly expert process, that properly done training is as far away from the old "sitting next to Nellie" process as it is possible to imagine. Yet one is told that training is going on throughout the country in companies where they do not begin to understand what modern training is all about, how the people who have really developed expertise in training set about it and what knowledge, skills and experience are required to get training properly done.

We need a huge expansion in the number of people who are able to train properly and who understand professionally what training is all about. The Government appear to think it enough to get together groups of employers who can spare time on a Friday afternoon to meet, whether or not they have done their week's work in the enterprises in which they are employed; people who have not applied training in their own concerns and who have refused to take advantage of the new developments in training. In fact, they are not so new. They have been around for a long time if people had had the eyes to see, the ears to hear and the willingness to make use of them. Do the Government seriously think that those people are going to be the spearhead of the great new advance in training in this country? If so, they will have to think again.

The available people will be either those who have the time and can be spared by their firms—in which case we are better without them because if they can be spared by their firms they can be spared by the training and enterprise agencies—or they will be people with too little clout and too little knowledge to achieve anything very much at all.

Of course, there are some important exceptions but those of us who worked on the area manpower boards know perfectly well that it was extraordinarily difficult to persuade employers who were capable of doing the job to give up the time to attend. What is the concrete evidence that industry will find these people with the knowledge, expertise, the time, the drive and the willingness to do the job which until now neither in their own companies nor in the area training boards have they been able to do? Why this sudden change? Without such people we shall not get either the quantity or quality of training.

We need a change of attitude among not only employers but among the people for whom training is intended. It should be intended, of course, for everyone from top to bottom. If the Government had thought about this matter years ago we would not be in the mess we are in today. If we had had tip-top management training over the past 15 years, as have many other countries, we would not be worrying about training inside enterprises because tip-top managers, properly trained, would have ensured that employees throughout their organisations were getting the necessary training.

Have the Government given any encouragement to that kind of management training? Have the Government taken on board that the best kind of management training is that which is closely linked to organisational development. Organisational development linked to management development is the way in which to get results. That is only achieved with people who fully understand what these complex concepts mean and know how to apply them. There have been attempts in universities and business schools to develop this expertise. In places, it is done extremely well. However, in the great majority of cases, people would not even know what I am talking about.

Training is not only a matter of giving people the opportunity to learn; they have to want to learn. People must feel that it is worth their while to be trained. There must be the attitude that training is an opportunity which must be seized. There is precious little evidence of that kind of feeling in this country. There was difficulty enough to persuade youngsters to join the youth training programme; partly because the schools did not understand how important it was and gave very little encouragement in the early days and partly because there was a strong feeling which parents and schools (not all of them, but many) shared—that it was better to get what was called a "real job", even if no training was involved but where a little more money could be earned rather than take the opportunity to learn. The great danger now is that with more jobs available youngsters will be encouraged, from a number of sources, to take those jobs with no training even though training is available. Unless we can develop the attitude in the schools, among parents, and in youngsters, that training is worthwhile we are wasting our time in seeking to encourage it.

Quantity and quality are what we need, but there is no evidence that we are going to get it. How are we to get that quantity and quality? The Government could have learned a great deal from some of our competitors. The Japanese have been good at getting people to understand why training is valuable for them. As my noble friend Lord Rochester said earlier, a small number of our greater companies have done exceedingly well in working through the difficult process of persuading people to collaborate in the development and delivery of training. It cannot be done by command process. You cannot make people learn. You cannot make people train. You can only make people want to learn or to train. Once they want to do that, your difficulties are at least halved. How can that be done? A great deal of work has gone into discovering that. The Government could have learned a lot from those people whom they greatly despise—the social scientists in this and other countries who have worked at the question of how to obtain a collaborative, participative approach where people feel that they have put something into the development of a training plan and are anxious to take part instead of having it imposed upon them as a command from above.

However, that kind of approach requires such a revolution in government thinking that one despairs of it ever happening. If the Government understood it they would be putting in their own changed programmes in local authorities, in health and in education in a totally different way. The Government do not understand: that is why those of us who care about training are almost in despair at the programme put before us.

6.38 p.m.

Baroness Turner of Camden

My Lords, I too welcome the opportunity again to debate in your Lordships' House the important subject of training. I express my appreciation to the noble Lord, Lord Rochester, for introducing the subject, and, indeed, for the manner in which he introduced it. I share very many of the views he expressed.

The Government's views on this whole question are well known because we have the White Paper Employment for the 1990s. The question before the House this evening raises the whole issue of a training culture. By that I take it to mean not only public attitudes to training and the part that the Government play in forming those attitudes but also the structures created in order to deliver training of the type and variety felt appropriate to cope with our situation. My noble friend Lord McCarthy has this evening said a great deal about the structures. I cannot improve on what he has said. The Government have made clear what they think.

The belief clearly set out in the White Paper is that training is mainly a matter for employers and for privatised organisations. That is a departure from the thinking of previous governments, including past Conservative ones. It was a Conservative Government who introduced the Industrial Training Act in the 1960s. That and subsequent legislation created the industrial training boards that the White Paper seeks to abandon or to turn into non-statutory bodies. Yet, as my noble friend Lord McCarthy said, the industry boards have been successful. It would be unjust to lay at their door the failure, comparatively speaking, of training in this country. But matters would have been very much worse without the ITBs. The Engineering Industry Training Board, for example, has had some success in spreading and sustaining training. It is also having success in changing the image of the industry so that it is now increasingly seen as offering career opportunities for women.

It has been able to persuade employers to train women from their current unskilled workforces, pointing out the desirability of doing this since training is thus being given to people who are already familiar with the company and who have already developed company loyalty. Quite clearly, in-house training of that kind is necessary and desirable. In conjunction with a number of universities, programmes have been designed to enable young women to make informed decisions about engineering as a career. The board's annual report provides details of an impressive amount of work done, including accounts of companies that have actually been assisted to effect a complete turn-round from near collapse to profitability as a result of training programmes.

Here we have a body that is tripartite, with representatives of unions, including my own, as well as employers and educationists. It, and the Construction Industry Training Board, to which reference has already been made this evening, are parts of the present structure, which can be seen to have worked to some degree. There is no evidence at all that non-statutory bodies with a predominance of employers will do any better. In fact the contrary is likely to be the case. In any sector where there is a prevalence of small enterprises, regulation will be very difficult indeed without some form of statutory backing. The Government should be prepared to build on what has been reasonably sucessful in difficult circumstances.

One of the reasons for the decline of skill training was the manufacturing industry recession in the 1980s, when apprenticeship training seems to have collapsed. That could not be laid at the doors of the ITBs; it was entirely outside their control and due to a number of factors, including government policies.

Furthermore, as we have heard this evening, a well-trained workforce depends on having a well-educated workforce. There is a vital need to expand secondary school mathematics and science education for girls, as well as for boys, to ensure that those entering the workforce have the necessary basic competence to profit from further training. That has been dealt with in the admirable speech of my noble friend Lady David this evening. She spoke about the need to ensure that there was liaison between the government departments responsible. Access to training also needs to be made available to those who have left full-time education. Access to training and retraining needs to be available throughout life. For all this, adequate resources are required. The Government appear to expect employers to pay. Employers should play their part in providing the necessary funds, but there is also a national responsibility. Public funds have to be made available at an adequate level.

The Government's White Paper refers to maintaining a partnership on training but proposes structures that are unlikely to foster the kind of partnership likely to deliver. On past showing, employers are unlikely to give the voluntary commitment for which the Government ask. As has already been mentioned by the noble Baroness, Lady Seear, employer participation at area manpower boards, for example, was often poor compared with that of other people present; namely, the trade unionists and so on. The proposed structure of the training and enterprise councils is not tripartite. It is said in the White Paper that individual unions may be represented if they support the aims of the council. However, these aims are such that no union is likely to say that it would not support them. There is no suggestion either that disadvantaged groups such as ethnic minorities should have any representation. Neither is there anything about partnership at enterprise level.

Whatever the Government think about union representation—and the White Paper makes it very clear that they do not like collective representation and are all for an individual approach—the fact remains that many millions of workers still belong to unions. Particularly in large enterprises, unions tend to be strong and with well established systems of industrial relations and collective bargaining. That is particularly true of manufacturing industry. These are the structures upon which governments in the past have been willing to build. Unions are committed to training, whatever criticisms they may have had of various schemes introduced by the Government in the past. They have a role to play and they should not be deliberately excluded, as would appear to be the Government's intention.

Furthermore, in any kind of training culture, employees, those about to enter the workforce and those currently unemployed should have certain rights to training. First, there should be a right to some training each year with paid time off or a proper training allowance. I do not believe that that can be emphasised too much. There should be paid time off or a proper training allowance. That is what happens in Sweden where training and retraining are accepted as a fact of life and proper allowances and support are available for people when they are undertaking training. Secondly, there should be a right to training regardless of sex, race, religion or disability and regardless of the job performance.

Thirdly, there should be a right to take part in decisions about what training would be most effective. Finally, there should be a right to nationally and internationally-recognised standards of training. That is the kind of training culture for which we should be aiming. I do not believe that it is sufficiently outlined in the White Paper; neither is there any indication that the Government understand the changes in attitude that have to be created in order to make progress. Unless we are prepared to do this, I believe that the proposals in the White Paper will not remedy our situation at all. Indeed as the noble Baroness, Lady Seear, indicated, we seem to be going backwards rather than forwards.

I again welcome the oppportunity afforded by the noble Lord, Lord Rochester, to debate this subject, and I support very strongly what has been said by almost everyone who has spoken.

6.47 p.m.

The Earl of Dundee

My Lords, I should like to join with your Lordships in thanking the noble Lord, Lord Rochester, for introducing this debate. Underlying its general reference to training, the noble Lord offers us an interesting approach. He does not seek to look at the Government's present plans for training just on their own or in isolation. Rather he wishes to establish what different attitudes towards training the Government are trying to promote. Clearly some of these attitudes are directly evident from the new systems and mechanisms proposed in the White Paper. Others however are only to be inferred indirectly. That is why it is so constructive and useful to operate within the context of this kind of debate. As a result, we need not become bogged down with the contents of the White Paper itself. Instead we can focus, as your Lordships have done, on various connected themes about training and thereby, in the light of these connections, can attempt to judge which changes of attitudes towards training may now be desirable and practicable.

This White Paper, as with all White Papers, is concerned in the first place as background with certain facts or descriptions of conditions before it comes later to deal with certain prescriptions and recommended actions. Thus, in the first place it draws our attention to the international scene in which training has to take place in the 1990s. There is the European Single Market after 1992; the continuing competition from South-East Asia and elsewhere; the declining number of people coming into the British workforce; ever-advancing progress with technology, and so on. These are some of the factors with which we already know we have to contend and whose the impact on training no one would really seek or bother to deny.

Even so, if not contested, these facts are still not especially acknowledged. After all, the individual workplace or training centre is a long way from the international market. Therefore, perhaps the first thing that should be said about the country's attitude towards training is that, if this attitude does not contain enough awareness of the realities of trade and competition, then the background to the problem of training will not be seen for what it is and, equally, policies and remedies which address the problem will not be accepted for what they are trying to do.

The noble Lord, Lord Rochester, asked whether the new training initiative of 1981 is still in place. He asked whether it had been superseded by paragraph 4 of the White Paper and whether policy has still to be determined. The broad aims set out in the new training initiative of 1981 are still valid and the principles set out in paragraph 4 of the White Paper describe how the aims should be met in the context of the challenges facing the country today.

When we move from the background to the prescription and meat of the White Paper, the Government also seek a pragmatic understanding of and attitude towards training. As is well known, the Government's reasoning is that, since competition for goods and services will be even more testing in the 1990s than in the 1980s, the responsibility for training should be to a greater extent in the hands of employers—the people who have to take on and adjust to this challenge from competitive goods and services. Some noble Lords, I know, are concerned that too much responsibility for training is to be given to employers. Nevertheless we are proposing only a shift to employers in responsibility for training. It is not an abandonment by the Government.

The noble Lord, Lord Rochester, said that training through life is a government responsibility. The Government have contributed record expenditure —almost £3 billion per annum—to training and enterprise activities and fully accept the need for government commitment in this area. But training is a shared responsibility and employers need trained and adaptable staff to be competitive. Training and enterprise councils give employers a unique opportunity to lead the drive for training at local level. What is envisaged is simply the formation of a different partnership between Government and employers.

The noble Lord also asked whether training and enterprise councils will really be employer-led. Training and enterprise council boards of directors will be drawn from senior figures in local business and other leaders in the community. The board of directors will set the strategy and take decisions on training and enterprise activities. They will benefit from the help of Training Agency staff who will work for the TECs on secondment. But those staff will be entirely answerable and responsible to the board. Training and enterprise councils will indeed be employer-led.

The noble Lord, Lord McCarthy, made comparisons with international competitors. In West Germany, which has been very successful industrially, it is the local employers, through their chambers of commerce, who have a leading role in training. There is no reason why our local employers cannot help Britain to be equally successful. The noble Lord also asked what is the point of dismantling the industrial training boards. All the ITBs except the construction ITB raise funds by levy from a minority of their firms and rely increasingly on income generating activities which they operate. This is the path which the Government advocate. Employers are the primary customers of training and their support is necessary to be successful. It will be up to the industry concerned to put up proposals on the shape of successor bodies.

The noble Lord developed the theme further on ITBs. He asked why only the construction ITB is acknowledged as having special considerations when other industries have similar problems. It is surely a question of degree. The White Paper deals with each of the remaining ITBs board by board, and it is in this context that the Government acknowledge the greater difficulties in moving towards non-statutory training arrangements for the construction industry.

Lord Graham of Edmonton

My Lords, if the work of the industrial training boards was supported by only a minority of employers in industry, does it not demonstrate that the majority of the employers voluntarily decided not to participate? How does the Minister propose to change their attitude by this new arrangement? It is a simple question.

The Earl of Dundee

My Lords, the noble Lord suggests that the new arrangement is something radically different.

Lord Graham of Edmonton

Yes.

The Earl of Dundee

In one sense it is not different at all. It is simply an evolved way of addressing the problem. He will not find anything radically different in the contact which he fears.

Lord McCarthy

My Lords, the noble Earl has been kind enough to refer to several of my questions but has not answered any of them. I want him to answer one question on ITBs. What is the evidence that things have got better in those areas where the Government have abolished ITBs? In 1979 the Government put forward plans to abolish a large number of ITBs. What evidence is there that training has become better in the areas where the ITBs were abolished as against the areas where they remain?

The Earl of Dundee

My Lords, if the noble Lord studies recent experience he may not find that matters have become radically better. At the same time he will not find that matters have become radically worse. He must give a chance for our new proposals to work. There is every chance that they will work. We are distinguishing between one category of ITB and another. As the noble Lord pointed out himself, there is a distinction between the construction ITB and the others. We are perfectly prepared to put that in a category of its own.

Baroness Turner of Camden

My Lords, will the noble Earl be good enough to answer some of the points I made about the EITB? What is the Government's intention in that regard? What special circumstances relate to the CITB which do not relate to the EITB?

The Earl of Dundee

My Lords, as the noble Baroness implies, there is a quite strong link between the EITB and the CITB. I am anxious in my remarks now to deal with the general context of the debate initiated by the noble Lord, Lord Rochester, which is about attitudes. I am anxious not to be drawn into too many detailed responses. I hope that the noble Baroness will forgive me if I do not spend a long time in that vein.

My noble friend Lady Carnegy pointed out the need for TECs to reflect the responsiveness and values of the private sector. I am grateful for my noble friend's support for the TEC proposals. I entirely agree that TECs will help to bring a commercial and swift response to training and enterprise needs. Training and enterprise councils are about getting better value for taxpayers' money, and that of course is entirely to be welcomed.

My noble friend also said that employers are concerned that TECs should cover an area large enough to be viable yet remain local. She asked whether this would always be the case. It will be for individual TECs to agree the precise boundaries of their geographical area, but the average TEC will have a working population of a quarter of a million people and only in exceptional cases will they have fewer than 100,000. This should ensure that TECs are both large enough to be viable and small enough to retain a sense of local community.

I do not want to discuss the precise balance of the prescription for training of this new partnership between Government and employers. Nor do I wish to discuss the particular operations as conceived for training in enterprise councils. What is instead at issue in this debate is whether employers who are directly in touch with market forces and international competition should be far more prominent than they have been in influencing what training is carried out, and whether this kind of attitude to training as a means to business success should be encouraged in the country. On that issue it is the Government's contention that if such an attitude is not now cultivated, and if employers do not substantially decide about training, then the workforce will not be able properly to meet the challenges of the 1990s.

The noble Baroness, Lady David, asks if the private sector really wants to be involved in TECs. She also wonders whether the TECs are a replacement for local government. On her first point, I am glad to say that there has been an excellent response from the private sector and that we are expecting a number of early applications to establish TECs across the country. Regarding her second point, I can assure the noble Baroness that TECs will be encouraged to work with all the existing power bases and interests in the community, including local authorities.

Yet, while employers can best direct training to the advantage of national trade and competition, can they also do this to the advantage of the local community and the individual trainee? Again I do not want to be drawn into a description of the particular ingredients of local training arrangements. The general issue is whether employer-led training is in the best interests both of national trade and of the local community. The Government's view is that these two are inseparable. A successful and prosperous nation depends on the enterprise and competitiveness of its local communities. This is why TECs are about enterprise in the broadest sense as well as about training, and thereby are able to serve both national and local needs.

Regarding the individual employee and trainee I turn now to some indirect inferences and assumptions arising from the White Paper. Your Lordships may wonder what is the Government's attitude towards skill and competence in general. Is it simply the attainment of qualifications, or do we aim for the wider goal of adaptability and motivation to meet the challenges of the future as well as for excellence at work today? What we really should have of course are relevant qualifications—that is, qualifications which not only satisfy today's known skill needs but also lay the broad foundation on which future but unknown skill requirements can be built. In this way, the attainment of relevant qualifications marries in with the wider goals of producing a more competent, adaptable and motivated workforce.

The noble Baroness, Lady David, asked why is there not a lead body for education and training under NCVQ? There is a lead body for trainers which is seeking to establish standards of competence relating to all training functions. Discussions are taking place on the need for, and the role of, a lead body in the field of education. Standards developed in other sectors, including that of trainers, will have a potential application to a number of functions in the education sector.

The noble Baroness, Lady Seear, asked if TECs will really produce quality training. They most definitely will, because TECs will agree a performance-based contract with my right honourable friend the Secretary of State for Employment. The contract will specify targets for job entry after training, qualfications gained, business survival rates, etc., and this should help improve what employers and trainees most want from training, which is of course results.

Another theme is the Government's attitude and the country's attitude towards small businesses and large ones. It has been alleged that our present measures set out to improve the performance of large businesses, but do not do enough for small ones. The noble Baroness, Lady Seear, expressed concern about the training of managers, and asked what the Government are doing about it. We all share the noble Baroness's concern. That is why the Government, through business growth training, are providing help to employers to develop their management skills in the context of managing change and growth.

The new training partnership, to which I referred earlier, will take fully on board the special needs of small firms. Indeed, the recently announced new programme of business growth training, which will be largely administered by TECs, is specifically designed to encourage and help small firms to plan training as part of their overall business strategy. The Government are therefore very much concerned to change the attitude of small firms and to help to put training high on their agendas.

What may also appear to be inconsistent in the present approach—and the noble Lord, Lord Rochester, made this point—is the emphasis placed on the role of the business sector. The public sector is of course not exempted from government exhortations to improve training performance, yet the emphasis must be on the wealth-creating private sector, which drives the country's economy. Moreover, your Lordships will be well aware of other initiatives to make the public sector more responsive to commercial pressures and to compete with the private sector in some of the services which it provides. Clearly it will be those who train, whether in the public or the private sector, who are most likely to be successful.

The noble Lord, Lord McCarthy, inquired whether the Government will reduce expenditure on training, and at what rate. I should say that I am grateful that the noble Lord supports the Government's objectives, even if he cannot support the means, which I appreciate he does not. The Government's public expenditure plans published in January 1989 continue to show a substantial commitment in training and expenditure up to the years 1991 and 1992. As the noble Lord knows, expenditure beyond that date has not yet been settled.

The noble Lord, Lord McCarthy, asked whether we rely on employers to deliver training in TECs. The best of our employers have an excellent record for training. That is often the secret of their success. One of the key roles of TECs will be to encourage employers to recognise the value of training in their business strategy.

The noble Baroness, Lady Seear, questioned whether employers have the time to commit to TECs. I know the great commitment that the noble Baroness has made to the area manpower boards, where employers and others also give their time freely. There is concrete evidence that many employers around the country are prepared to give time to TECs. We hope to make that commitment not too onerous, but we are not prepared to stint on quality. We shall only accept employers who are chief executives or equivalent in their firm, and the signs are that we shall succeed.

Baroness Seear

My Lords, I am sorry to interrupt the noble Earl, but why does he think that chief executives are going to be expert in the training field? I do not understand the argument.

The Earl of Dundee

My Lords, I would always hope that chief executives would be as expert as they can be, but expertise does not have to be confined to chief executives. Certainly we do not want to be pedantic or too restrictive about who comes in and who cannot come in. At present I think it is our idea that we would encourage as many chief executives as possible to come along.

I know that there is concern that we still have a divided attitude towards education and training. Of course it goes without saying that there should be as much co-operation as possible over training between schools, colleges and other training establishments. The noble Baroness, Lady David, referred to LEAs and the strategic goals for education. In view of the TECs' strategic role for training, she asks how the two will be married together. It will of course be important for TECs and LEAs to work closely together and to share a common strategic approach. The Training Agency, through its contracts with TECs and the work of LEAs on plans for work-related further education, is well placed to help forge that link.

The noble Baroness, Lady David, also asked how TECs will work with the Department of Education. TECs will be an important source of advice and expertise on educational issues and will be able to offer informal advice to the Training Agency and to the Department of Education.

The noble Lord, Lord McCarthy, said that the seven levels of programmes and structures in the training agency are an administrative mess. I hope that he is not entirely correct! The Government's proposals in the White Paper are designed to bring coherence to the Training Agency's training and enterprise activities. The noble Lord is critical of our success. I make no apology for the many positive initiatives that the Government have undertaken, which have now brought unemployment below 2 million.

The co-operation that is desired in the area of training and education is exemplified by the need for both education and training to prepare people for a highly technological and fast-changing society. That requires a broad and balanced education and training programme which, nonetheless, does not lessen our traditional liberal attitude towards the provision of education. That is why under the Government's various provisions for young people we are trying to make education and training more relevant and responsive to industry's needs.

The noble Baroness, Lady David, asked whether the Government were content with the work-related further education programme now that the MSC has been abolished and whether the funding of the programme would remain the same. The answer is, yes. Her Majesty's Inspectorate reported that the programme provided a powerful incentive for LEAs to introduce planning and policy for further education. The abolition of the MSC does not affect the programme. The recent public expenditure White Paper forecast expenditure on that programme to increase from £112.45 million in 1989–90 to £115 million in 1990–91.

The various issues that we have all looked at during this debate constitute some of the themes affecting different attitudes towards training. In that context, the White Paper's proposals can be seen as a major step forward and as containing measures which are entirely consistent with the attainment of wider goals. These measures are, above all, about enterprise; about enterprising employers and individuals, and about people who must also possess that unity of purpose and attitude which we have been discussing today.

7.12 p.m.

Lord Rochester

My Lords, we will all wish to study carefully the response of the noble Earl, Lord Dundee, to the points that have been raised in this short debate. I must confess that my first reaction was one of disappointment. He was correct to say that we have been talking about attitudes, especially those of the Government in relation to their behaviour. If I may so with respect, to a large extent the Minister in his response was deploying the very attitude that I and other noble Lords have criticised: "There, there, my friends, there is no need to worry, everything is under control. There are a number of things upon which we do not disagree very much. However, you must understand that in these matters the Government know best, and no other approach is the right one—and thank you very much".

The best way to hamper change is to stifle initiative down the line, to refuse to be deflected by the voice of experience and reasoned argument from the course that one intends to pursue and to discourage people from becoming involved in helping to manage what has to be changed, unless of course they are established members of the hierarchy. To judge from the Government's response, they have not grasped the counter-productive effect that their present attitude is bound to have on what they are seeking to achieve, especially in failing to build, as has been said by a number of noble Lords, on the foundations that have already been laid, and in failing to be willing to enable all those having a stake in the problem, as I tried to say in my earlier speech, sharing in this important enterprise. I hope that in the light of some of the things that have been said this evening the Government will again think carefully about all this.

It remains for me only to thank all noble Lords who have taken so much trouble to take part in the debate. I for one have learnt a number of things. I trust that the debate will help to influence public opinion in the vital matter that we have been discussing. My Lords, I beg leave to withdraw my Motion for Papers.

Motion for Papers by leave, withdrawn.