Training and Enterprise Councils (Hansard, 26 January 1994)

§ Lord Henley
My Lords, training and enterprise councils play a major role in improving the competitiveness of local economies and we welcome the report's endorsement of the concept behind them. We are considering the report's detailed conclusions; but many of these have been overtaken by recent events. There are also some factual inaccuracies. We see no need for a rescue package.

§ Lord Rochester
My Lords, will the noble Lord first accept that in asking this Question I am not seeking simply to knock the TECs, which I very much hope will succeed? But how does he respond to the specific criticism that the TECs have become a quango led by employers, but still staffed largely by seconded civil servants, and prevented by tight central control from adapting adequately to local conditions, that they have been diverted from their primary economic purpose to the social task of providing for the unemployed and the disabled and that they are thus failing to help bridge the skills gap which has been so widely identified as a major hindrance to this country's competitiveness?

§ Lord Henley
My Lords, training is vital to the future of this country's competitiveness. The Government spend a great deal of money on training. Similarly, employers spend something of the order of £20 billion a year on training. The fact that employers have always quite rightly been the major investors in training is why we believe that the TECs, which are the major deliverers of our training packages, should be very much employer-led. I do not accept the noble Lord's allegation that the TECs have become quangos. They are private companies, normally limited by guarantee. They are not quangos, non-departmental public bodies or executive agencies, and their directors are not chosen or appointed by the Government. As regards the number of civil servants working for them, at the beginning, when the TECs were first set up, a number of civil servants were transferred to TECs. But that number has been and is rapidly declining.

§ Lord Taylor of Gryfe
My Lords, is the Minister aware that a survey in The Times on the report said: Business empowerment [in the TECs] has become largely a sham"? The survey identified a waste of £250 million per annum. Is he further aware that on the same day the Daily Telegraph said: A scheme to pay firms up to £2,340 for every job created for the long-term unemployed has been a flop"? In those circumstances, and reviewing the report which is in the Library, does the Minister feel that his department will tackle this matter urgently?

§ Lord Henley
My Lords, I do not accept the noble Lord's allegations. We believe that the TECs have been an enormous success in delivering our various training packages. The LSE report was generally supportive of the concept behind TECs. Further, I can refer the noble Lord to the report from the CBI. I was stressing earlier that we believe that training should very much be employer-led. The CBI itself was very supportive and recognised exactly what the TECs had done and what they had achieved.

§ Lord Dean of Beswick
My Lords, if the noble Lord, Lord Rochester, is right, and if the Government are right that we are now starting on a substantial and sustained improvement in the economy, is it not also correct that now is the time for the provision of training and adequate skills to people in sufficient numbers if the economy does really have a sustained uplift?

§ Lord Henley
My Lords, the economy is on the path of sustained growth. That is why we shall continue to spend a great deal of money on training as we are doing now. That is why we shall continue to provide a great many training places through the TECs; and that is why thereafter the economy will continue to grow. We believe that the TECs have been vital in delivering this particular package. I do not accept the allegation of the noble Lord, Lord Rochester, to which the noble Lord, Lord Dean, referred. I am saying that the LSE accepted that the TECs had been a very useful concept. A great many other people have said so as well.

§ Lord Dormand of Easington
My Lords, if the Government will not look at the independent report referred to by the noble Lord, Lord Rochester, will they examine the very recent CBI report on training, which includes 50 recommendations for government action including a number directed towards TECs; first, on the role of TECs, which comes as a great surprise two years after they have been set up; secondly, on financing the TECs; and, thirdly, on local accountability, which is surely of very great importance and which has been emphasised by the Government on many occasions; and also as regards bureaucracy? Are not these major items which the Government should be looking at?

§ Lord Henley
My Lords, of course we are always looking at these matters. We shall study in great detail the very long LSE report. What we are trying to make clear is that much of the report has been overtaken by events. It was based on field work between 1990 and 1992 when many TECs were in their first year. The report was completed before the announcement of our integrated regional offices and the wider TEC role in economic generation, and so forth. We shall study what it has to say. I am trying to make clear that events have overtaken that particular report. Further, the CBI report was generally supportive of the Government's position and supportive of the role of TECs. It said that TECs had some very considerable achievements. Obviously, we shall study what the CBI has to say, and we shall respond in due course.

§ Baroness Turner of Camden
My Lords, is the Minister aware that it is not a very old report which we are speaking about, but one which went up to the middle of 1993? Is the Minister further aware that one of the criticisms made is that the TECs are likely to drift into a second-tier role as business leaders lose interest? Was there not always a problem with the Government's philosophy of employer-led training that in recession some employers were bound to see their first obligation as keeping their businesses afloat, and that therefore there was bound to be a loss of interest during the recession? Can the Minister say what is being done to remedy that?

§ Lord Henley
My Lords, I accept that it is a new report. What I was trying to make clear to the noble Lord, Lord Dormand, was that the report was based on field work between 1990 and 1992. Things have moved on a very great deal since then. As I have said, many TECs were then in their first year. I do not accept the suggestion of the noble Baroness from the report that 960 many of the businessmen on the TECs are losing interest. Many of the businessmen are staying with the TECs far longer than originally intended and are in fact devoting much more time to them than they originally intended.