HL Deb 06 February 1995 vol 561 cc4-6

2.47 p.m.

Baroness Turner of Camden asked Her Majesty's Government:

What steps they will take to ensure that other training and enterprise councils (TECs) do not encounter difficulties similar to those experienced by the South Thames TEC now being wound up; and what will take the place of that TEC if it ceases to exist.

Lord Inglewood

My Lords, the problems at South Thames TEC are atypical and stem from poor management accounting and inadequate internal financial controls. Sound commercial management, together with the existing contractual requirements on training and enterprise councils provide a proper framework for TECs to operate within. There is, therefore, no need to change the organisation of TECs.

My honourable friend, the Parliamentary Under-Secretary of State for Employment, James Paice, has invited two of the neighbouring TECs to take on between them responsibility for the provision of services in the current South Thames TEC area for 1995–96. He has invited CENTEC (the Central London TEC) to put proposals to him on how it would provide the full range of TEC responsibilities in the boroughs of Lambeth and Southwark and SOLOTEC (the South London TEC) in Greenwich and Lewisham.

Baroness Turner of Camden

My Lords, I thank the Minister for his response. However, is the noble Lord aware that there has been considerable criticism by former leading staff of the TEC: that one of the reasons for the problems that have arisen has been the Government's insistence that state-sponsored training for jobless people should be less about quality provision and more about getting people off the register of the long-term unemployed? Is the noble Lord also aware that difficulties arose regarding seconded civil servants who were able to provide a great deal of expertise? For example, once they were removed when their secondment had come to an end, there was difficulty in replacing the expertise that had disappeared.

Lord Inglewood

My Lords, as I explained in my Answer, the problems that have afflicted South Thames TEC are to do with financial management and cost control. It seems to us that the criticisms of which we are aware and to which the noble Baroness, Lady Turner, alluded have no direct bearing on the matter in hand.

Lord Avebury

My Lords, is the Minister aware of the particular difficulties which face the Windmill Project in Clapham as a result of the demise of the TEC? That project had taken on a training worker on contract who was funded 75 per cent. by the Home Secretary and 25 per cent. by the TEC. When the money ceased to come in in November, the Windmill Project (which is a small charity) had, nevertheless, to continue the payments which it was obliged to make under contract. Will one of the two other TECs to which the noble Lord referred in his reply assume that obligation?

Lord Inglewood

My Lords, I thank the noble Lord, Lord Avebury, for his question. I do not know the details of the Windmill Project to which he refers. Therefore I hope that I shall be forgiven for answering in more general terms. For payments which are due in respect of claims after 7th November, the Government have issued a letter of comfort to ensure that the bills will be honoured. The question of outstanding moneys relates exclusively to the period before 7th November. As regards the longer term, for the immediate future the activities are being managed by the receiver. As I explained in the first reply that I gave, for the period 1995–96 it is anticipated that the responsibilities of the South Thames TEC will be divided as I outlined.

Lord Gladwin of Clee

My Lords, while appreciating the answer given by the Minister as regards the reasons for splitting the South Thames TEC in half, does he agree that what is really required now is a strategic look at London's needs? It is not satisfactory to split this difficult area of London into two and to ask the neighbouring TECs to do the work. We need something more than that. Will the Minister help?

Lord Inglewood

My Lords, as regards the longer term, my right honourable friend the Secretary of State has announced that he will conduct an investigation into the future of the TECs throughout the London area. He is proposing to start by discussing the matter with the chairmen of all the TECs concerned to see whether the best solution is the one that is currently in place. I am sure that noble Lords on all sides of the House will agree that it is important that we deal with this in the most satisfactory manner from the point of view of all those concerned.

Baroness Seear

My Lords, will the noble Lord accept that we are glad to hear that there will be an inquiry by the Secretary of State into the TECs in London because there is a great deal of anxiety on the part of those who depend on them for training programmes? I declare an interest because the Apex Trust, of which I am chairman, has such interests. When this inquiry is undertaken, will the Minister ask his right honourable friend the Secretary of State to take into account the problem of people with special needs? The whole trend in TEC financing has been such that the money goes where there is success in getting jobs or qualifications. This leaves people with special needs very much out in the cold. Yet it is those people who, more than others, need training if they are to get back into employment. They are the people who tend to cause a great deal of both economic and social difficulty.

Lord Inglewood

My Lords, I shall be pleased to pass on the comments of the noble Baroness to the Secretary of State.

Lord McCarthy

My Lords, will the Minister tell us how he can say in advance of the inquiry he announces that what went on in this TEC was atypical? Surely many other TECs might be running out of money and out of control. How can he tell us in advance that nothing like that situation will be found?

Lord Inglewood

My Lords, as regards the noble Lord's question, it is important to be clear that the inquiry to which I referred is concerned with determining the way in which the allocation of responsibilities of TECs is conducted across London. As regards the particular problems of the TEC we are discussing, in the contract that is in place between the TECs and the department there is a stipulation about the manner in which the internal financial controls are carried out. Way back in December 1993 South Thames TEC was identified as being the only TEC in the country that was high risk in this regard. In answer to the noble Lord's question, I would say that it is possible to identify that this was an atypical circumstance for the reasons I have given.