HL Deb 09 July 2003 vol 651 cc284-95

3.50 p.m.

Baroness Ashton of Upholland

My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Secretary of State for Education and Skills. The Statement is as follows:

"With permission, Mr Speaker, I shall make a Statement on the Government's Skills Strategy.

"We are today publishing a White Paper that sets out the Government's long-term strategy for improving and sustaining the development of skills in this country. Copies have been placed in the Library of the House. I believe that there is a consensus in this House, and more widely, about the need for this country to raise its skill levels. We must do that in order to become more competitive, to raise living standards, to increase productivity, and to offer better opportunities for all.

"It is widely recognised that, if we are to achieve the economic success we all want, our most pressing educational challenge is to raise skills at all levels. It is in this area, rather than primary, secondary or higher education, that this country lags behind our international competitors. For example, the proportion of our workforce qualified to the crucial intermediate level of technical and craft skills is low at 28 per cent compared with 51 per cent in France and 65 per cent in Germany.

"This is despite the fact that we have made progress in recent years. For example, the number of vocational A-levels and vocational GCSEs awarded has risen by over 40,000 in one year to reach 128,000 in 2002; the number of young people on modern apprenticeships has risen to over 234,000 in 2002; 75 per cent of 16 to 18 year-olds now stay on in education or training, the highest level since 1996.

"Despite these advances, there remain major shortfalls: workforce skills are lower in Britain than in many other countries; there are persistent skills deficits in such important areas as technical and craft skills, maths, and management and leadership; too many adults lack the skills and qualifications needed for sustainable employability; too many young people are leaving education without the skills that employers need.

"These shortfalls are serious. This White Paper addresses them.

"We have consulted widely. The overwhelming view, which I heartily share, is that the need now is not for piecemeal initiatives or clever tactical gimmicks. It is to make much better use of what is already there and to put in place a strategic approach. We need a coherent, long-term, national strategy which provides easy access to high quality training, across the full range of skills from basic to advanced. It must be based upon a framework which offers flexibility, relevance and choice. It must deliver the skills which are needed by both employees and employers, both jobseekers and the retired.

"The main elements of this framework can be easily set out. They are, first, at national level, a network of 23 sector skills councils, to be fully in place by next summer. They will cover the major sectors of the economy. The councils are a major new voice for employers and employees in their sector. They are charged with identifying the sector's present and future skill needs, ensuring that qualifications and training meet those needs, and getting employers to act together to invest in skills to raise productivity. They place employers and the workplace centre stage.

"Secondly, at regional level, a powerful new partnership between regional development agencies and the learning and skills councils will link regional economic development goals with the skills to achieve them, focused on the needs of learners and employers. This will tie in business support services, so that businesses can get better access to the advice and help that they need.

"Thirdly, at local level, training programmes—whether delivered in colleges or the workplace—will be sharply focused upon meeting those skill priorities, in a truly demand-led and so responsive system.

"This simple framework will help people gain skills at all levels. It will create a regime in which the education and training services genuinely have to respond to the demands of both potential students—often employees—and employers.

"It will mean expansion of modern apprenticeships to help more young people move from school into high quality, work-based training. We will lift the current age cap so that adults will also be able to benefit. It will mean new opportunities for the millions of adults who do not currently possess a good foundation of skills for employability to get their first level 2 qualification. It will mean that the Skills for Life campaign in which adults gain basic literacy and numeracy skills will be extended to include information and communications technologies. It will mean more training to fill skills gaps at the higher technician and craft levels—the so-called level 3—to meet regional or sectoral priorities. It will mean that our new foundation degrees will be developed and expanded to meet the ever-growing demand from employers for advanced vocational skills.

"To build this ladder of opportunity, we will introduce major reforms. We will develop a framework of qualifications for adults based on units and credits which give learners and employers more flexibility to put together the package of training they want. In addition, we will guarantee protection for leisure learning, particularly for pensioners and people on low incomes. We will ensure greater employer involvement in the design and delivery of modern apprenticeships. We will provide better, clearer information for employers and potential students about the opportunities which exist and the support which is available, including an employees guide to good training. We will expand the network of union learning representatives, focused upon encouraging the low-skilled to engage in training. We will give a new guarantee of free tuition for any adult without a good foundation of skills for employability, to get the training they need to gain a first level 2 qualification. We will introduce a new adult learning grant to support full-time adult learners in these priority groups to meet the costs of learning. We will use our employer training pilots to inform and guide our future national employers' training programme.

"Better skills are needed for Britain to flourish. Those skills are the key to our economic success in an increasingly competitive world. They are also critical to our future in the European Union. The economic reform agenda agreed in Lisbon in 2000 reflects the importance of skills across Europe. Many of the topics addressed in this White Paper reflect the concerns shared by our European partners. They reflect our determination to tackle the challenges of skills and mobility across the Union.

"My right honourable friend the Chancellor of the Exchequer stated to the House on 9th June in his Statement on Economic and Monetary Union that, labour market flexibility and structural economic reform [is] at the heart of the new … policy guidelines for Europe"; that, Britain [must] have the necessary flexibility to sustain growth and employment"; and that, we are making structural reforms that will bring increased flexibility to our economy". This flexibility was the core of the Chancellor's second test for membership of economic and monetary union.

"The Government believe that the White Paper which I am publishing today is a major contribution to this increased flexibility which is necessary to ensure that the British economy could respond quickly and efficiently to changes in economic conditions inside the single currency area should the UK decide to join the economic and monetary union. Our proposals will help to ensure that the supply of skills in the labour market matches the skills that are in demand from employers, and they will put in place mechanisms to eliminate mismatches in the demand and supply of different skills.

"The changes which I set out today represent the most ambitious agenda yet seen to tackle some very deep-seated and long-standing weaknesses in our national skills base. They have been developed through a strong partnership between my department and my colleagues in the Treasury, the Department of Trade and Industry and the Department for Work and Pensions. The Government will lead by example by ensuring that each central government department addresses its own skills needs and gaps in the way that I have described.

"Even more important, this strategy represents not simply a government initiative, but a commitment by all the main social partners—the Government, the CBI, the TUC and the Small Business Council. All will be represented in the Skills Alliance which we are establishing to carry through the implementation of these proposals, in a sustained, determined campaign finally to tackle those skills weaknesses which have dogged us for so long.

"I commend this Statement to the House".

My Lords, that concludes the Statement.

4 p.m.

Baroness Blatch

My Lords, I am grateful to the noble Baroness for repeating the Statement, but, sadly, as before, 1 must start by referring to yet another example of contempt for Parliament. We have read endless newspaper and media-leaked reports in recent days. There were meetings last night with representatives of public bodies, as part of the launch of the strategy. Only this morning, the Secretary of State talked in some detail about the proposals. Once again, as a last resort, there was information for Parliament.

I am sure that, as with each of the previous education Statements repeated by the noble Baroness in this place, the noble Baroness will offer to report our disdain for such contempt of Parliament to the Secretary of State. We know, however, that, so far, that has had no effect, and the practice continues. That is no personal criticism of the Minister, whom I know and respect. She is diligent in her work in this House. The contempt for Parliament lies with her ministerial colleagues in another place.

As the noble Baroness suggested, there is consensus on the need for a skills strategy. There is a. real challenge for skills and training, but the Statement represents a missed opportunity. It lacks clarity and focus. The paper has been long awaited. Where is the vision? Where is the radical edge? We have the same old predictable centralised and complex bureaucracy. There is a plethora of national, regional and local cross-cutting structures. Yet more funding will be dissipated in a system in which people spend more time in liaising and co-ordinating than in training. At the end of that costly waste of time, the funding left to train plumbers and construction workers will he extremely limited.

The big visionary idea would appear to be the payment of £30 a week to entice people into education. My first question to the noble Baroness is: what sort of numbers is it envisaged will find that a great attraction? What system will be in place to avoid fraudulent recipients and/or providers, as with individual learning accounts?

What of the replacement for individual learning accounts? Only weeks ago, we were told that it was a high priority for government. Ministers insisted that a similar wide-ranging scheme would replace individual learning accounts, but, in the Statement, we see only a fraction of the scope of the original scheme. The report has dismayed consultants, who say that many adult learners will be left with no chance to develop new skills. Training provider Hairnet is reported to have said that it was amazed by the news. It said that it had hoped that the White Paper would offer adult learners at least part of what had been included in the ILA scheme. A Hairnet spokeswoman told the press: We can't believe that there will be nothing considering the government's stated commitment to adult training, especially in IT fields".

Once again, England is missing out. Seemingly, England is left with no ILA replacement scheme similar to the original, while schemes similar to the original, with lessons learnt, will be introduced in Wales and Scotland. Although we know of the expensive debacle of the ILA scheme, many were under the impression that lessons had been learnt by the Government and that an improved and better managed scheme would take its place. My second question is: why has that not happened and why has it been abandoned?

It is regrettable that the Statement does not include a major schools dimension, emphasising the importance of scientific, technological and vocational options in the curriculum. There is no mention of schools education. I agree with my honourable friend Damian Green who, in another place, quoted Carolyn Hayman, the chief executive of the Foyer Federation, an admirable body. This morning, she said: In practice, those who fail to gain qualifications while at school are unlikely to fulfil their potential later in life". She is right. The decision to concentrate the strategy on adults only is deeply regrettable.

Will the Minister define a "unique learning identifier"? Am I right in thinking that it could be an ID card? If it is an ID card, to what other uses—compulsory or otherwise—would it be put?

What is it that further education colleges and providers of training are not doing that they could do better, if they could only receive the funding, rather than creating yet more processing bodies? What is the timescale for the proposals, given that the snail's pace progress of the setting up of sector skills councils does not bode well for the speedy transformation of training in this country? At that point, I pay tribute to industry for the £23 billion spent on education and training. That is three times the budget of the learning and skills councils.

It is beyond belief that, in the Statement, the Secretary of State should boast that it represents the most ambitious agenda yet. Crowded in on the same territory are such diverse and unaccountable bodies as learning and skills councils, sector skills councils and regional development agencies. To those, one can add the University for Industry, learndirect, colleges, training providers, county councils and local education committees. On the horizon are the regional assemblies, which, if we are to believe what we were told during the passage of the Regional Assemblies (Preparations) Bill, will also have a role in such matters.

Just liaising between those bodies and sustaining territorial integrity and the complementary delivery of policies and services will be a nightmare. The regional dimension of the proposals is worrying. What matters to young people who have lost out in education requires to be identified and provided for locally. For some young people who dip out of education, meeting the cost of getting out of a rural village to a provider is the only inhibiting factor against their taking up a training option. Thirty pounds a week will probably meet only the fare to get to the provider and will do nothing to pay for the training.

Any description of the strategy as a "simple framework" ought to be a candidate for prosecution under the Trade Descriptions Act. It is not what is being done; it is the way in which it is being done. As I said, there is a need for a good, competent, effective skills strategy. Once again, however, central control, complex procedures, endless time-consuming liaison and co-ordination and costly bureaucracy is the Government's answer to a problem. Another opportunity has been missed.

4.7 p.m.

Baroness Sharp of Guildford

My Lords, I follow the noble Baroness, Lady Blatch, in thanking the Minister for repeating the Statement. We share the view of the Opposition that it is disappointing that, once again, we learnt of the content of the White Paper and the Statement from the "Today" programme—in spite of the Government's disagreements with that programme—and from the press, rather than in Parliament first of all.

Nevertheless, on these Benches, we are possibly rather more welcoming of the White Paper and of the Statement than are the Opposition. First, perhaps because we read the Statement together with the 14-to-19 proposals that are coming forward from the Government, we see it as part of a relatively comprehensive strategy for the skills sector. We are delighted to see, for the first time, the Government beginning to map out a pathway for vocational education and training from schools, through colleges and, if appropriate, on to the universities. In particular, we are pleased to see that it is proposed that the system should be unit-based, enabling the individual to build up qualifications over time in blocks.

We are also pleased to see the emphasis on modern apprenticeships. It is sad that, in this country, the concept of apprenticeship has almost disappeared. It is good that the modern apprenticeship, which, appropriately, is much shorter than the original seven-year apprenticeship—it is usually a three or four-year apprenticeship—is given new emphasis. We are beginning to see young people recognising it as a viable form of training, but not enough young people recognise it as a viable alternative route. Too many schools channel people into the academic, rather than the vocational, route, and all the incentives in schools point in that direction. Too many children and parents think that the right way to go is straight through A-levels and on to university, rather than to go through practical and vocational training that can lead to equivalent level qualifications. This provides a framework that provides those routes, but we are not confident yet that it is fully in place.

Finally, we are pleased, too, to see the recognition of the importance of skills in the innovation agenda and the role to be played at the regional level. In my research at the University of Sussex, I did a fair amount of work on the role of regions in helping to regenerate industry and skills. The skills agenda was a very important part of that. From time to time I have been very critical of successive governments for not paying enough attention to it. I am very pleased to see that.

However, we have a number of criticisms. First, as the noble Baroness, Lady Blatch, mentioned, there seems to be a quite unnecessary number of quangos, both at the national and, perhaps particularly, the regional level. There are the regional development agencies, local learning and skills councils, Jobcentre Plus, business links and so forth. It will be very difficult for employers, colleges and, for that matter, individuals to unravel all these networks. Again, we are sad that, as yet, the regional development agencies are unelected. We look forward to a time when some of these agencies can be properly accountable to the electorate.

Secondly, while we welcome the universal entitlement to training to level 2 paid for by the state, we are very unhappy that this is not extended to level 3. There had been some talk of extending that entitlement to 19 to 30 year-olds studying at level 3, but that seems to have been withdrawn. Instead, we now have what might be called a regional lottery for support at level 3. Who will make the decisions? Will it be the planners, the employers or the students? It is not at all clear from the proposals.

Thirdly, the introduction of the new adult learner grant is a positive step. Can the Minister explain why a full-time level 4 student studying at university from home is reckoned to need a grant of £3,000 per year for maintenance purposes, whereas the equivalent maintenance for a student at a further education college is £1,500 only? Can the Minister look at the support for modern apprenticeships again? We welcome the lifting of the age bar from 25 to 28, but why not lift it altogether? If adults are expected to extend their working life to 70, is there not need for an adult modern apprenticeship? There are a great many people in their twenties deciding that having obtained little in the way of qualifications they would like to train properly for a skill, such as plumbing or carpentry. Currently, often there are few grants available for them.

Finally, can the Minister give an assurance that the foundation degree, which plays a part, is not regarded as an end qualification, hut as a staging post to be built on to go forward to an honours degree and postgraduate qualification?

4.13 p.m.

Baroness Ashton of Upholland

My Lords, I am pleased to have got through the Statement with my bad throat. I am grateful for the warmish words of the noble Baroness, Lady Sharp, in welcoming it. As the noble Baroness, Lady Blatch, would expect, I shall pick up her first issue of contempt. I appreciate the comments that the noble Baroness made about me. I have a copy of a letter sent by my right honourable friend the Secretary of State to the Speaker of the House of Commons in which he clearly says that the purpose of the breakfast meeting today was to discuss plans for the national skills alliance. It was not to launch the White Paper. I believe that my right honourable friend fully complied with correct parliamentary procedure in the way in which he made his Statement earlier in another place.

Both noble Baronesses raised the overarching issue of quangos and the relationship between the different bodies. The core of the White Paper states that what we have on the ground are a number of different partners which are either involved in training from a national perspective—employers, the Trades Union Congress, and so forth—or are delivery partners. In fact, they already exist. One cannot differentiate and say, "Well, actually we do not need some of these partners". They all play a different and important role. The White Paper seeks to bring together those partners in the skills alliance to recognise the different roles that each will play—whether further education colleges, Jobcentre Plus or whatever the delivery agency—to ensure that they operate together on the ground.

The noble Baroness, Lady Blatch, is right. I agree with her wholeheartedly. The need to identify the needs of young people and satisfy them must be the critical factor on which this White Paper and what ensues will be judged. By bringing them together at a national and regional level, we have a greater opportunity to provide appropriately.

The noble Baroness, Lady Blatch, specifically asked what we thought would be gained by the roll-out of the new adult learning grant. In the first pilot year, we estimate that we shall help some 12,200 learners studying for a full-time level 2 or level 3 qualification. Rolled out nationally, the grant could help more than 60,000 learners a year. The noble Baroness also raised the issue of the successor scheme to the individual learning accounts. We have discussed this issue several times in your Lordships' House. When we looked at the options, we believed that setting up a small, separate initiative was not the way forward to achieve the original vision behind the individual learning accounts and to take an integrated approach. In view of the comments made by the noble Baroness, Lady Blatch, it is important to note that part of the focus on free learning at level 2 will be to broaden the range of training provided in order to bring within the scope of public funding those private providers which have something distinctive to offer and can meet the necessary quality standards. That is an important factor in our decision to move forward in this way.

I shall not comment on what Wales may or may not be doing. It is for the Welsh Assembly to publish its own views and ideas.

The purpose of the unique learning number is specifically to address the issue raised by many young people and those involved in training. We have different identifiers in different organisations. In order to reduce bureaucracy it might make a great deal of sense for learners to transfer between organisations and providers in a simpler and more straightforward way.

I acknowledge the commitment by industry and the noble Baroness referred to its £23 billion input. That is why we have consulted widely with industry and employers to ensure that the new strategy is very much economic-led and the need to have skills that are appropriate to the economy of the future. It is about integration.

The noble Baroness, Lady Sharp, mentioned the modern apprenticeship, which she is very keen to see developed. I am pleased that we have some of the highest levels since they were introduced in 1994; that is, more than 234,000 young people on a modern apprenticeship. That is a good indication of its value, but I agree that more needs to be done. I also accept the need to ensure that vocational routes into employment are perceived as being as important as academic routes. Those issues have been debated many times in your Lordships' House.

I am also very pleased that the RDAs play a significant role on the regional scene. As I already said, the economic basis is absolutely critical.

Finally, the noble Baroness, Lady Sharp, referred to foundation degrees, which indeed are a staging post that will allow people to continue to full degrees.

4.19 p.m.

Lord Haskel

My Lords, I welcome the Government's initiative on encouraging vocational training. It is absolutely right to do this at a regional level. That point was made by Professor Porter in a recent study about productivity for the DTI. He identified a weakness in management and leadership as a reason for weaknesses in productivity in British industry. Does the White Paper address this problem? Could the Minister say something about that?

Baroness Ashton of Upholland

My Lords, I agree that it is important to develop excellent leadership and management skills. Such skills are very important in the schools system, but they are absolutely critical in the business environment. That is why we have a new programme valued at £10 million of public money to support leaders and owner-managers, in particular those in charge of small and medium-sized enterprises. My noble friend will know of the chartered manager award from the Chartered Management Institute. It offers managers a welcome opportunity to attain professional recognition. So we are fully supportive of the comments made by my noble friend.

Baroness Carnegy of Lour

My Lords, I have listened with enormous interest to the noble Baroness because, as she probably knows, this has long been an interest of mine. Some time ago I served as a commissioner on the Manpower Services Commission which considered exclusively these matters.

It is interesting to note that the Government have sought to address these issues through yet another initiative. I am not sure which Secretary of State remarked that a day without a new initiative is a day lost, but we do see a great many new ones. However, I compliment the Government on the magazine they have produced to accompany the strategy. It is not illustrated. No doubt a little money has been saved and I am sure that the document is just as convincing without pictures. Although I have not yet had time to read it carefully having collected it only a few minutes ago, I do have a question to put to the noble Baroness which, from my current experience, gives me cause for concern.

The noble Baroness knows that I live in Scotland. Although the initiative is not to apply there, it is my experience that the best way to resolve these problems is for a further education college to have local centres which then become a magnet for people who want skills training. The local centres should be welcoming and should see to it that all the necessary skills training is available, accessible and local so that people do not have to travel too far.

The White Paper pays tribute to further education colleges in England, which I know are doing a great deal to develop their efforts in this direction. Given that, is it really a good idea to consider setting up yet another quango on a fairly local basis to do the same thing? Surely it is absolutely critical to ensure that there is a hub to which older learners and those in need of skills training may go, along with younger people and the unemployed. In that way, everyone congregates in one place where they can receive advice and be catered for in a local centre. Are the Government sure that that will not be made more difficult to achieve if another quango seeks to do the same thing?

I fear that this is, above all, just another new initiative and that we may find that it competes with what is already on the ground. Can the noble Baroness explain to the House what is to be the link between the local initiatives to be undertaken by further education colleges and the work of the new councils? How will they avoid the risk of each detracting from what the other is doing?

Baroness Ashton of Upholland

My Lords, I am pleased that the noble Baroness, Lady Carnegy, likes our new document. I would comment only that a picture can be worth a thousand words. On occasion I find that they lighten documents, but perhaps we should leave that discussion for another debate.

As always, the noble Baroness speaks with great authority about the practicalities of what happens on the ground. She is absolutely right to point out that if what we do fails to address the need for local bases where learners can acquire the teaching they want and relate to it in a local way, then we will simply not have succeeded in what we are trying to do.

We have brought together several elements at the national level. A skills strategy requires impetus, which is why we have an alliance chaired by my right honourable friend the Secretary of State for Education and Skills and my right honourable friend the Secretary of State for Trade and Industry, along with the involvement of the Treasury and from the Department for Work and Pensions. Together they bring to the strategy a critical cross-governmental approach. We must link major organisations who have a real interest in this, and not least the Small Business Council which will have much to say on training issues, and then take those links down to the regional level in terms of our requirements for economic development. I say that because the skills strategy is not only for the kind of expertise we need now but, as I am sure the noble Baroness will acknowledge, to ensure that we have in place the skills we are going to need in the future to compete in the constantly changing global economy. That also takes account of the fact that very rarely nowadays do people take on a job which will last them a lifetime.

Given that, I believe that there is a need to deploy strategic thinking at both the national and the regional level. We are not trying to introduce what might be called a "traditional" new initiative, which is perhaps what the noble Baroness suggested; rather we have brought together what already exists, given it new impetus and put in what we think is a relevant and appropriate mechanism. But the fundamental proof will be seen when local individuals are given the opportunity to acquire skills—to achieve that much-needed level 2, which is most vital. It is probably worth reminding noble Lords that most people given training by employers are those who are already quite well qualified. Those lacking basic skills tend not to be offered training. So our commitment needs to concentrate on developing the provision of basic skills.

Further, we must ensure that people are given the opportunity to access, through local further education colleges, through Jobcentre Plus offices, through their employer and so forth, a route to a form of learning that is absolutely right for them. As the strategy filters down it should ensure that from whatever point individuals begin they will find themselves on the road to training. That, I think, will be the proof of the pudding.