Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [Lords]

2nd reading
Tuesday 25th February 2025 Commons Chamber

Second Reading

[Madam Deputy Speaker (Ms Nusrat Ghani)]

The reasoned amendment in the name of Ian Sollom has been selected.

15:08

[The Secretary of State for Education (Bridget Phillipson)]

I beg to move, That the Bill be now read a Second time.

We are a country of incredible talent and enterprise; a country of industry and invention. Our universities lead the world. Our colleges deliver excellence to hundreds of thousands up and down the country. British companies founded on great ideas export their products across the globe. Our strengths range from research to manufacturing and from professional services to creative industries, yet there remains a wide and growing gap between where we are now and what I know our great country is capable of, because, despite our many strengths, there are skills missing from our workforce.

There are skills missed by people who want to get on in life, get better training to land that great job and earn a decent living; skills missed by our employers, with businesses, hospitals, labs and factories held back; skills missed by so many of our communities, with towns and cities left behind as industry has moved on; and skills missed by our country. Those skills are vital to the security and growth that this Labour Government are so determined to deliver.

Our latest data shows us that half a million vacancies sit empty simply because employers struggle to find the right staff with the right skills: the most since we started collecting the data in 2011. That is half a million jobs not filled, half a million careers not boosted and half a million opportunities not taken—a tragic waste that this country simply cannot afford. But I am sorry to say that this is not surprising. We have fallen behind our neighbours on higher technical qualifications—the ones that sit just below degree level, but which can lead to well-paid, fulfilling careers for software developers, civil engineering technicians or construction site supervisors.

Over 90% of employers value basic digital skills in their job candidates, but more than 7 million adults lack them. Our skills gaps deal our people and our country a double blow. They hold back the economic growth we need to invest in our public services and drive national prosperity, and they hold back the ambitions of working people who deserve the chance not just to get by but to get on. They deny them the opportunity, the power and the freedom to choose the life they want to live.

[Sir Ashley Fox (Bridgwater) (Con)]

Would the Secretary of State agree that one of the difficulties is that employers cannot spend the money from the apprenticeship levy easily, and that too much of that money is retained by the Treasury? Will she undertake to speak to the Chancellor to see whether she could make it easier for employers to spend that money on training?

[Bridget Phillipson]

I can assure the hon. Gentleman that the Chancellor is as committed as I am to ensuring that we have the right skills within the economy, because without them we will not be able to deliver the economic growth that is the No. 1 mission of this Labour Government. But we are committed to reforming the failing apprenticeship levy, reforming the system and converting it into a growth and skills levy with more flexibility for employers. As a first step, this will include shorter-duration and foundation apprenticeships in targeted sectors, making sure that we are working more effectively with employers in order for our economy to grow.

[Sir John Hayes (South Holland and The Deepings) (Con)]

I welcome the commitment to skills that the Secretary of State is articulating, but will she recognise that too often the advice given to young people, particularly from schools, is to pursue an academic career—I use the word “academic” in the loosest possible sense—rather than to engage in practical learning? That means that while the shortages she describes are profound, there are also many people who are graduates in non-graduate jobs owing a lot of money and with pretty useless degrees.

[Bridget Phillipson]

I was almost on the point of saying that I agreed with much of what the right hon. Gentleman had to say, but unfortunately he went and ruined it at the end with that comment about the value of university education and of having the chance to gain a degree. Where I do share common cause with him is that I want to make sure that all young people have a range of pathways available to them, including fantastic technical training routes, including through apprenticeships, but I also want to make sure that young people with talent and ability are able to take up a university course if that is the right path and the right choice for them.

As we were recently celebrating National Apprenticeship Week, I took the opportunity to see across the country some of the fantastic routes that are available in areas such as construction and nuclear, with really wonderful job opportunities and careers where young people are able to make fantastic progress.

[Chris Vince (Harlow) (Lab/Co-op)]

I had the opportunity to visit Harlow College during National Apprenticeship Week, and I really agree with the points that my right hon. Friend is making. Does she agree that if we are to achieve the new homes targets that we really want to achieve and get people off the streets and into those homes, we need to train those apprentices now and that Skills England can be part of that future?

[Bridget Phillipson]

I agree with my hon. Friend, and I know how much he champions, in his constituency and in the House, opportunities for young people to have the chance to take on new skills, including through apprenticeship routes. Where it comes to construction, he is right to say that there are fantastic opportunities out there. It was heartening, during some of my visits during National Apprenticeship Week, to see the fantastic contribution that women play in construction, breaking down some of the stereotypes that exist about the right opportunities, and to meet some amazing engineering apprentices and bricklaying apprentices. Those women are really trailblazing in an industry that is often very male-dominated.

[Mr Toby Perkins (Chesterfield) (Lab)]

On the subject of construction, does my right hon. Friend agree that a huge amount of the construction industry is made up of small employers and that one of the biggest failings of the apprenticeship levy approach has been that small and medium-sized enterprises have been shut out? We have had a 50% reduction in the number of SMEs offering apprenticeships since the introduction of the levy. How will she increase the number of SMEs that are able to offer apprenticeships? If the major employers are the ones that have all the budget, how do we ensure that we increase the number of SME apprenticeships?

[Bridget Phillipson]

My hon. Friend has a long-standing interest in this area and has consistently raised not only the challenges faced by small businesses but the opportunities to create more apprenticeship starts and more training routes for people across our country. One of the changes that we set out during National Apprenticeship Week was to the maths and English requirements for adult apprentices, which will make a big difference to employers large and small and was welcomed by business, but he is right to say that much more is needed to help smaller employers and small contractors to take on apprentices. That is the work that Skills England will drive forward and that is why this Bill is such a crucial development.

The skills gaps that we face in our country deny people the opportunity, the power and the freedom to choose the life that they want to live. But it is not just today that we count the cost; those gaps limit our power to shape the careers, the economy and the society of tomorrow as well. Only with the right skills can people take control of their future, and only with the right skills system can we drive the growth that this country needs. It is time this country took skills seriously again: no longer an afterthought, but now at the centre of change; no longer a nice to have, but now a driving force for opportunity; no longer neglected, but now a national strength.

There is much to celebrate. Plenty of colleges go above and beyond, plenty of employers are ready to contribute and plenty of people are eager to upskill, but our system needs reform. Too many people have been sidelined and left without the skills to seize opportunity. One in eight young people are not in employment, education or training. We can, and we must, do more to break down the barriers to learning that too many people still face. We need a system that is firing on all cylinders.

[Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)]

The figure in Stoke-on-Trent is even more stark, with 22% of young people not in education, employment or training. We have a wonderful ecosystem of colleges, with Stoke sixth form college, Stoke-on-Trent college and the University of Staffordshire, but as my hon. Friend the Member for Chesterfield (Mr Perkins) said, we also have small and medium-sized organisations. Can the Secretary of State set out how this Bill will help an organisation such as the Spark Group, run by Dan Canavan, to tap into opportunities in order to spread his ability to help those young people into well-paid jobs in my community?

[Bridget Phillipson]

My hon. Friend names a fantastic business in his constituency and the contribution that it makes. There is a lot more that we need to do to support smaller employers to be in a stronger position to benefit from apprenticeships.

This Bill will bring together the many disparate parts of a very fragmented system, which employers, particularly smaller employers, often find hard to navigate the right way through, and are not always clear about the best training and qualification routes in order to find the people that they need. Also, the changes we have made to English and maths in particular will support employers to create 10,000 additional apprenticeships every single year. This was a call that we heard loud and clear from employers, and it is a simple, straightforward change that will open up opportunities for people across our country. They will still have the English and maths standards as part of their apprenticeship, but they will no longer be held back by some of the red tape that has denied them the chance to get on in life.

The skills system that we have right now is too fragmented, too confusing and too tangled up across too many organisations. There is no single source of truth, no single organisation able to zoom out and see the big problems and no single authority able to bring the sector together to solve them. The result is a system that amounts to less than the sum of its parts. For young people, it can be hard to know where the opportunities lie. Adults looking to upskill or reskill and working people hoping for a fresh start are too often met with confusion, not clarity. They are presented with a muddling mix of options when they need clear pathways to great careers.

It is no better for employers. They tell us that the system is difficult to navigate and slow to respond. They tell us that they are too often shut out of course design and that their voices are too often not heard. The result is frustration. Learners and employers are frustrated, and they are right to be frustrated. Many businesses do a good job of investing in the skills of their workforce, but others simply are not spending enough.

Investment is at its lowest since 2011 at just half the EU average. We must empower businesses to reverse the trend by investing in their employees, and for that, we need to move forward. There will always remain a strong and galvanising role for competition, but where it is harmful, adds complexity, duplicates efforts or twists incentives, we will balance it with supportive co-ordination to ensure that all parts of the system are pulling in the right direction.

Here is our vision and the change we need. From sidelined to supported, we need a system that helps everyone so that businesses can secure the skilled workforce they need. From fragmented to coherent, we need a system defined by clear and powerful pathways to success and towards effective co-ordination. We also need a system of partnership with everyone pulling together towards the same goals. That is the change that Skills England will oversee.

This Labour Government are a mission-led Government with a plan for change, and skills are essential to Labour’s missions to drive economic growth and break down the barriers to opportunity. In fact, skills go way beyond that. Skills training contributes across our society, and great skills training driven by Skills England, supported by my Department, guided by the wisdom of colleges, universities, businesses, mayors and trade unions, and directed by national priorities and local communities is the skills system we need. It is a system that will drive forward all our missions. It will help us fix our NHS, create clean energy and deliver safer streets.

Skills are the fuel that will drive a decade of national renewal, which is vital for our plan for change. That is why earlier this month we unveiled our plans to help thousands more apprentices to qualify every year. That means more people with the right skills in high-demand sectors from social care to construction and beyond. We have listened to what businesses have told us. We will shorten the minimum length of apprenticeships and put employers in charge of decisions on English and maths requirements for adults.

Last November, the Government announced £140 million of investment in homebuilding skills hubs. Once fully up to speed, the hubs will deliver more than 5,000 fast-track apprenticeships a year, helping to build the extra homes that the people of this country desperately need. We are driving change for our skills system, and Skills England is leading the charge. It will assess the skills needed on the ground regionally and nationally now and in the years to come. Where skills evolve rapidly and where new and exciting technologies are accelerating from AI to clean energy, Skills England will be ready to give employers the fast and flexible support they need.

[Tom Hayes (Bournemouth East) (Lab)]

I represent a coastal community. Coastal communities have been forgotten over the past 14 years almost as much as the skills agenda. In my constituency, Bournemouth and Poole college led by Phil Sayles, who is doing incredible work, is about to open the green energy construction campus in April, which will enable solar, heat pump and rainwater capture skills to be taught to apprentices and trainees. Will my right hon. Friend join me in congratulating the college, and does she agree that colleges like that one are critical to achieving clean power by 2030?

[Bridget Phillipson]

I am delighted to hear my hon. Friend’s experience from Bournemouth. Our colleges are a crucial part of how we ensure that we have the skills we need in our economy, but also how we will drive forward our agenda on clean energy. He is also right to identify the enormous opportunities for jobs, growth and training, as well as, crucially, the imperative of ensuring that we have stability and security in our energy supply, so that never again are we so exposed to the fluctuations of energy markets that happened because of the invasion of Ukraine.

[Luke Taylor (Sutton and Cheam) (LD)]

I want to amplify the valuable skills that our colleges are teaching in renewable technologies. I recently visited South Thames college in Wandsworth, where I saw the labs it has set up to teach the installation of heat pumps and other renewable technologies. The main challenge that the college faces is finding staff to teach the classes and to take on the apprentices and all the other learners. What support will the Government give to colleges to ensure that they can recruit experienced individuals to pass on those skills to the apprentices, so that we can provide the workforces that we dearly need?

[Bridget Phillipson]

The hon. Gentleman is right about the challenges across the further education sector. Sadly, we know those challenges all too well after 14 years of failure under the Conservatives. We recognise the enormous opportunity that comes from investing in our fantastic colleges. That is why at the Budget we announced an extra £300 million of additional revenue for further education and £300 million of new capital investment. That also builds on our investment to extend targeted retention incentive payments of up to £6,000 after tax to eligible early career FE teachers in key subject areas. Our FE sector will have a crucial role to play in our mission for growth and opportunity, and he is right to draw attention to that.

Skills England will be ready to give employers the fast and flexible support they need. While updates to courses in the past have been sluggish and left behind by new technology, the Bill will help us keep up with the pace of change. Skills England will draw on high-quality data. It will design courses that are demand-led and shaped from the ground up by employers. Employers should be in no doubt that they will have a critical role in course design and delivery. That is why I have appointed Phil Smith to chair Skills England. Phil brings a wealth of business expertise from his two decades leading Cisco and will ensure that employers are at the heart of Skills England. I have appointed Sir David Bell as vice-chair, drawing on his wealth of experience across education and Whitehall. I have also appointed Tessa Griffiths and Sarah Maclean as chief executive on a job-share basis, with Gemma Marsh as deputy chief executive. They will provide strong, independent leadership to move the skills system forward. Skills England will be held accountable by an independent board, and the Bill requires a report to be published and laid before Parliament, setting out the impact on technical education and apprenticeships of the exercise of the functions in the measure.

The clear relationship between the Department and Skills England is governed by a public framework document, which will be published for all to see. It will be a core constitutional document produced in line with guidance from the Treasury, making clear the different roles of my Department and Skills England. Skills England will reach across the country. It will not be trapped in Whitehall but spread to every town and city, because growth and employment must benefit every part of the country, not just where it is easy to drive growth. That means being ambitious, especially in areas that have been overlooked for decades, because talent and aspiration are no less present in those places.

Skills England will drive co-ordinated action to meet regional and national skills needs at all levels and in all places. It will work closely with mayoral strategic authorities and local and regional organisations, and it will connect with counterparts in Scotland, Wales and Northern Ireland. Skills England will simplify the system by combining functions within one powerful body and pulling together the disparate strands of Departments, local leaders, colleges, universities and training providers and weaving them into a coherent offer for businesses and learners alike.

To see why the skills revolution is so important for growth and why we must take skills seriously again, we should look no further than the UK’s stalling productivity over the last decade and a half, dragging down our economy and cutting off hopes of higher incomes for workers. The skills system is central because, despite all its problems, the expansion of workforce skills drove a third of average annual productivity growth between 2001 and 2019. Here we have a chance. Here we see what is at stake. If we get this right by investing in our people and backing Skills England, we can drive productivity and get economic growth back on track. At the same time, we can give working people power and choice because that is what good skills can offer: the chance for them to take control of their careers and take advantage of the opportunities that our economy will create. That is why Skills England will work to support the forthcoming industrial strategy unveiled by the Chancellor last November. The next phase of its work will provide further evidence on the strategy’s eight growth-driving sectors: advanced manufacturing, clean energy, the creative industries, defence, digital, financial services, life sciences, and professional and business services. Added to those are two more: construction and healthcare.

Skills England will work closely with the Industrial Strategy Council, which will monitor the strategy’s progress against clear objectives.

[Mr Perkins]

I am grateful to the Secretary of State for giving way again. She is speaking incredibly powerfully and passionately about the role of Skills England, and I share her commitment and excitement about it, but as she knows, this IfATE Bill abolishes IfATE rather than creating Skills England. There were those who believed that putting Skills England on a statutory footing as an independent body, rather than keeping it in the Department, might have been the way to go. Will she explain to the House why she has taken this approach, and why she believes that Skills England will, as a body in her Department rather than as a truly independent body, have the strength and respect in the sector that it so badly needs?

[Bridget Phillipson]

I will set out the reason primarily and then say a little about the way in which Skills England will operate. First, the need to do it in this way is one of time and speed. As I hope I have set out to the House, the need to act is urgent; we must get on with this and ensure that we tackle the chronic skills shortages right across our country—there is no time to waste. The Government are determined to drive opportunity and growth in every corner of our country. Further delays to that will hold back not just growth but opportunities.

When it comes to the function of Skills England and how it will operate, it will be an Executive agency of the Department for Education. It will have the independence that it needs to perform its role effectively, with a robust governance and accountability framework and a chair who brings an enormous wealth of experience from business. A strong, independent board, chaired by Phil Smith, will balance operational independence with proximity to Government. It will operate in the same way that many Executive agencies, such as the Driver and Vehicle Licensing Agency, already operate.

As with any new arm’s length body, in the next 18 to 24 months we will review how Skills England is functioning, to consider whether it still exists within the best model. [Interruption.] That is entirely in keeping with the way in which arm’s length bodies are routinely considered by the Government. I am surprised that Conservative Members are surprised, because that is simply how these things are done, as they know all too well. If they are content to allow drift and delay, they will hold back opportunity for people across our country; they will hold back the demand that businesses rightly lay at our door to get on with the job of creating the conditions in which they can deliver more apprenticeship starts, more opportunities, and more chances to learn and upskill.

Skills England will work closely with the Industrial Strategy Council, which will monitor the strategy’s progress against clear objectives. The Skills England chair will have a permanent seat on the council—that really matters. By 2035 there will be at least 1.4 million new jobs. Our clean energy mission will rely on talented people with the expertise to power our greener future. The pace of technological change, including artificial intelligence, is accelerating, and it brings huge opportunities for our economy. However, to seize those opportunities, firms need a ready supply of people with the right skills. We will nurture home-grown talent in all regions so that people have the skills they need for those exciting jobs of the future.

Skills England will work with the Migration Advisory Committee to ensure that training in England accounts for the overall need of the labour market and to reduce the reliance of some sectors on labour from abroad.

[Gareth Snell]

I thank the Secretary of State for being so generous with her time. I absolutely support her ambition of ensuring that we have the skills for the jobs of the future. Will she say a little about how Skills England will support foundational manufacturing industries, such as ceramics in Stoke-on-Trent, which will not be prioritised in the industrial strategy but still have a lot to offer our economy and are crying out for skills from local people? If we can get that right, we can grow our own economy, and that is true levelling up in my opinion.

[Bridget Phillipson]

My hon. Friend always champions the ceramics industry in his constituency. We have had many conversations on that topic, and he is absolutely right to put it into context. Skills England will benefit the ceramics industry and his constituents because we will be able to move much more rapidly to make changes to qualifications and training requirements in order to meet the needs of employers, with further flexibility, shorter courses, and foundation apprenticeships for young people for the chance to get on, including in long-standing traditional industries as well as in future jobs and opportunities.

The Bill is a crucial leap forward, bringing the different parts of the skills system closer together, and it paves the way for Skills England. It transfers the current functions of the Institute for Apprenticeships and Technical Education to the Secretary of State, not to exercise power from Westminster, but to empower the expert leadership of Skills England to drive the change we need. Bringing those functions to Skills England will place the content and design of technical qualifications at the heart of our skills system, where they belong.

Skills England has existed in shadow form since Labour took power and began the work of change in July. It set out its first “state of the nation” report into skills gaps in our economy in September. Skills England is moving ahead. The leadership is in place, and by laying the groundwork for a swift transition to Skills England, we are moving a step closer towards a joined-up skills system.

At its heart, this Bill is about growth and opportunity—growth for our economy, and opportunity for our people—and there is no time to waste. We need action, not delay. The people of this country need better jobs, higher wages and brighter futures; no more vacancies unfilled due to a lack of skills, no more chances missed and no more growth lost. We need change now, not change pushed back to some foggy future, so we are pushing ahead.

This is legislation that builds on what has come before but demands more—more cohesion, more dynamism and more ambition. That is how we break down the barriers to opportunity, that is how we fire up the engines of economic growth, and that is how we deliver the future that this country deserves—the bright hope that our best days lie ahead of us. I commend this Bill to the House.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the shadow Secretary of State.

00:00

[Laura Trott (Sevenoaks) (Con)]

I rise to speak on a piece of legislation that poses more risks than benefits and proves that there is not parity of esteem for technical and academic qualifications within the Government. The Secretary of State is putting forward a Bill that allows her personally to write each apprenticeship assessment. Just in case you think I am exaggerating, Madam Deputy Speaker, we can see it in the explanatory notes. The Bill provides

“the option for each standard and apprenticeship assessment plan to be prepared by the Secretary of State”.

Madam Deputy Speaker, can you imagine the outcry if this was done with history GCSEs? If it were a Conservative Government taking these powers, there would be howls of outrage from the Labour party. It is extraordinary that the Government are, contrary to the words of the Secretary of State today, cutting out employers and giving sole discretion to the Secretary of State. They would not allow it with academic qualifications; we must not allow it with vocational ones.

I acknowledge the statement made in the other place about clarifying the situations when the Government envisage the Secretary of State intervening, but the specific criteria for using this power should be on the face of the Bill. At the moment, the Secretary of State has carte blanche to do whatever she likes, and we know from the Children’s Wellbeing and Schools Bill that that is a very bad idea. Can the Minister confirm that there will be some restrictions, and will the Government put those on the face of the Bill?

The Bill is another manifestation of the Department for Education’s centralisation spree. As with the Children’s Wellbeing and Schools Bill, everything must be controlled by the Secretary of State, and no innovation is allowed. The Bill abolishes the Institute for Apprenticeships and Technical Education—shortened to IfATE—and transfers its functions to the Secretary of State, in effect absorbing them into the Department for Education. The Government say that they will set up Skills England, but there are no details on the plans for Skills England in the Bill, or on how the Government’s proposed changes to the funding of skills-based qualifications will work in practice.

Simply creating a new agency will not address any of the issues that we need to address within the skills system. Even putting aside my severe doubts about the wisdom of progressing down this road in the first place, the very least the Government could provide the House with is some information on Skills England itself in the Bill. The only thing we know from debates in the other place—the Secretary of State has confirmed it today—is that Skills England will not be on a statutory footing and therefore will unquestionably be less independent than IfATE. Can the Secretary of State explain why this is an improvement?

This matters because the framework document published in the autumn is, at best, vague and, at worst, silent on the role of employers. There are some statements in the section on aims saying that employers will be engaged in the preparation of occupational standards, but it does not say how. Does the Secretary of State think that she knows better than employers? I urge her to explain why employers are so much less visible in the framework document, or to agree to amend the Bill. Reducing the role of employers will harm the apprenticeship system.

The change will also create unnecessary turmoil in the skills system. A cross-party amendment was passed in the other place to try to minimise the impact that this uncertain upheaval will have. The amendment will delay the provisions of the Bill to ensure that Skills England has time to set up before taking on its role and to ensure that the administrative duties do not get in the way of providing quality apprenticeships. That seems the bare minimum of what we would expect, and I hope the Government will not oppose that amendment, because to do so would be absurd.

The skills system needs a stable landscape, but the Bill presents real risks with no obvious benefits: risks that the Government will erode standards in our skills system by removing the relationship with the employer and replacing it with diktat from the Secretary of State; risks of poor leadership by replacing a good organisation, which is liked by employers and apprentices, with an unknown and undefined body.

[Mr Perkins]

I am listening carefully to the right hon. Lady. She seems to be evangelising the role of IfATE, but I have heard far stronger criticisms of it than she appears to make. Is her position that IfATE does not have many faults and should carry on the way it is, or does she think that the organisation’s remit has grown and is vague, and most employers feel that it is a block to getting the standards they need, rather than the vehicle for that, as she seems to suggest?

[Laura Trott]

I have huge respect for the hon. Gentleman and thought his earlier question was spot on. There is much that needs to be improved, but that is much less vague than Skills England, which is what we have in front of us at the moment. There are risks of distraction, with the time and cost involved in creating a new agency in the Department for Education. If the Government were serious about progressing quickly with the urgent strategic issues that I accept are needed in skills reform, the most effective step would be to build on the success of IfATE, rather than dismantling it. Instead, the Bill threatens to undo much of the progress made under successive Conservative Governments in building a world-class apprenticeships and technical education system. It is fiddling for no reason, change for no purpose and, as is so often the case with this Government, the opposite of what is required.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the Chair of the Education Committee.

15:41

[Helen Hayes (Dulwich and West Norwood) (Lab)]

The further education and skills sector is of strategic importance, and equipping our workforce with the skills that employers need is critical for economic growth. Ensuring that there are opportunities for young people and those mid-career to access high-quality training in order to enhance and develop their skills is vital for breaking down the barriers to opportunity that hold back far too many people. For far too long, the further education and skills sector has been the Cinderella service of our education system, patronised with lip service about how important it is, always regarded as second best, and never allocated the level of funding needed to really deliver.

Despite the fact that at the very peak only around one third of 18-year-olds go on to university, our school system is overwhelmingly orientated to communicate to young people that university is the option they should all aim for, rather than supporting a plurality of education options post-18, all of which can equip them well for a successful career. That has created a postcode lottery in which the high-quality further education and training opportunities that are available in some parts of the country are not available everywhere.

[Sir John Hayes]

The hon. Lady is making a profoundly important point that reinforces what I said earlier about careers advice and guidance. When I was skills Minister, I introduced a statutory duty on providers to make available free and independent advice. The problem is that that is often done by means of the internet. Schools will refer students to the internet, rather than bring people such as independent advisers into the school to guide them. She is right that the best solution to the problem she sets out is exactly that kind of involvement from careers advisers with students.

[Helen Hayes]

I thank the right hon. Member for his intervention. I was delighted recently to visit a school in my constituency, and a careers fair that gave young people the opportunity to meet many employers and providers of further education face to face, in order to give real meaning and reality to what such opportunities might provide in the future. It is important that young people have those opportunities.

Recently, I was delighted to visit the Lambeth college campus in Vauxhall, which is part of the Southbank University group, with my hon. Friend the Member for Vauxhall and Camberwell Green (Florence Eshalomi). We met young people engaged in cutting-edge training in robotics, renewable energy installation, dental technology and game design and production. They were being equipped with valuable skills to help them to access high-quality jobs, with the possibility, in some cases, of progressing their training all the way to degree level at the university.

The college is a good example of a strategic vision being applied to skills at a local level to ensure that employers’ needs are being met, and that the best possible opportunities are made available to young people, but not everywhere can benefit from such a strategic approach at present. I therefore welcome the Bill, which will formally establish Skills England. It is encouraging that this Government are giving further education and skills the strategic prominence they need, and seeking to establish an effective national agency to deliver a step change in the strategy that underpins our approach to skills and the quality and availability of training opportunities.

Skills England has been operating in shadow form within the Department for Education since July last year. Following the passage of the Bill, it will become an executive agency. This important Bill will work to underpin many of the strategic aims of the Government, including the delivery of economic growth, the skills to provide the additional 1.5 million homes that need to be built, and the skills to drive the urgently needed transition of our energy sector to achieve net zero, and the much-needed improvements in our national health service and in social care.

As the first Skills England report highlights, we currently have a fragmented and confusing landscape that lets down learners, frustrates businesses and holds back growth. The current system that the Government inherited has been badly neglected and urgent action is needed to deliver the change and scale of ambition required.

While I welcome the Bill, there are a number of issues on which I would be grateful for further clarity from the Government. The Bill does not provide a statutory underpinning for Skills England, meaning that the Secretary of State and future Secretaries of State can make fundamental changes to Skills England or close it down without the consent of Parliament. That calls into question the ability of Skills England to deliver a stable long-term underpinning of the skills system over a period of time. I understand the Government’s urgency, but it is important that in delivering this change Skills England is placed on a really solid foundation.

In order to be effective in delivering the skills system that our country needs, Skills England will need to have leverage with a number of different Government Departments beyond the Department for Education, yet the chief executive of Skills England is the equivalent of a director-level post in the civil service, not a director general, calling into question the extent to which appropriately senior people from across Government will be required to act on its recommendations and work in effective partnership. As the Bill progresses, the Government should consider the seniority of the CEO in that light.

Partnership working with key stakeholders outside Government, including training providers, trade unions, employers and devolved authorities will also be critical to the success of Skills England, but none of that is written into the Bill, and the ways in which Skills England will be held accountable for effective partnership working are unclear. Will the Secretary of State take further action to address that?

The impact statement for the Bill states that there may be a drop in apprenticeship starts while the Institute for Apprenticeships and Technical Education’s functions are transferred to the Secretary of State and then to Skills England, with a disproportionate impact on adult apprenticeships, disadvantaged learners and disadvantaged regions. Will the Secretary of State explain what steps she will take to minimise and mitigate that potential short-term drop?

The success of Skills England will depend on a series of wider factors that should be considered at the point at which it is being established. There is a significant issue with the funding of sixth form colleges, particularly around inequities in pay between teachers in schools and colleges, exacerbated by the failure to extend the recent pay increase to teachers to those employed by colleges. It cannot be right that a teacher in a college can be paid less than a teacher in a school sixth form for teaching exactly the same subject.

To drive parity of esteem between pupils following an academic route and those following a vocational route, it is important that sixth form colleges are able to both recruit and retain teachers. That means addressing the lower pay in sixth form colleges compared with schools, and the gap between teacher salaries and the salaries that teachers could receive in industry. It is a real problem for colleges seeking to recruit teachers of vocational subjects that those who have the skills to teach trade can often earn far more by practising that trade in the private sector. There is currently very little obligation on industry to release staff to deliver vocational education or to help to secure the pipeline of vocational teachers, including through post-retirement options. The Government should give further consideration to the recruitment and retention of high-quality teachers in the further education sector.

For some students in the further education sector, their school days have not been the happiest days of their lives. College or an apprenticeship should be the place where they start to find the things that they can excel at and where their confidence is built because they start to succeed. The importance of a functional level of English and maths is universally accepted and understood, so something is badly wrong in our education system when 38% of students do not achieve a grade 3 or above in English and maths at GCSE. The cycle of failure ends up continuing in the FE sector, which requires them to resit again and again. There must be a better way to ensure the functional skills in these subjects that employers need within further education, while enabling young people genuinely to succeed, build their confidence and thrive.

Finally, I will raise the issue of the huge differential in the information provided to sixth form students as they decide on their next steps after school or college—a point made by the right hon. Member for South Holland and The Deepings (Sir John Hayes) earlier in the debate. When meeting with skills providers and school leaders in my constituency recently, many participants highlighted how a move to university was often presented as a natural, secure step, with multiple options and a well-trodden path through the UCAS process, while vocational options, including apprenticeships and degree apprenticeships, were not presented with the same clarity or coherence, or even within the same timeframe. That makes it harder for teachers to advise their students and for parents to have confidence in pathways that may appear less predictable and secure. If we want to see true parity of esteem between academic and vocational routes, that needs to change, and I hope that it will be a priority for the newly established Skills England.

The Education Committee recognises the strategic importance of further education and skills, and we have recently launched a substantial inquiry that aims to understand how the further education system can better equip young people with skills and qualifications for a range of sectors experiencing labour shortages while opening up a wider range of opportunities to young people and mid-career switchers. We will make our recommendations to the Government in due course, and we look forward to playing our part in scrutinising the work of Skills England.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the Liberal Democrat spokesperson.

15:51

[Ian Sollom (St Neots and Mid Cambridgeshire) (LD)]

I beg to move an amendment, to leave out from “That” to the end of the Question and add:

“this House declines to give a Second Reading to the Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill because, while acknowledging the importance of reforming the delivery of skills and technical education, it fails to establish Skills England as a statutory independent body; because it centralises decision-making power in the hands of the Secretary of State; because it provides for the abolition of the Institute for Apprenticeships and Technical Education without ensuring a legally defined replacement; and because it lacks provisions to ensure that Skills England is directly accountable to Parliament.”

The Government are right that our skills system needs reform. The Liberal Democrats agree with the Secretary of State that our current fragmented and confusing skills landscape lets down learners, frustrates businesses and holds back growth, as she made clear in her foreword to Skills England’s first report in the autumn.

I and my hon. Friends on the Liberal Democrat Benches share the ambition to build a high-skill, high-productivity workforce that can meet our economy’s needs, and reform is essential for that ambition to be realised. Like many in the sector, we were encouraged to hear the Government prioritising that last July in the King’s Speech, with the statement:

“My Government will establish Skills England which will have a new partnership with employers at its heart”,

but the Bill before us does not establish Skills England at all; it simply abolishes the Institute for Apprenticeships and Technical Education and transfers the functions directly to the Secretary of State. We need a strong, independent skills body with proper parliamentary oversight and genuine employer engagement, but this Bill delivers a centralisation of power in the hands of Ministers.

There are examples of bodies that combine independence and strong democratic accountability for the most critical policy areas. The Office for Budget Responsibility has statutory independence while being directly accountable to Parliament through the Treasury Committee. Its leadership is subject to parliamentary approval, its reports must be laid before Parliament and it has clear statutory duties to ensure transparency. The Climate Change Committee similarly has a clear statutory basis that ensures it can provide independent advice while being properly scrutinised by Parliament, yet the framework proposed for Skills England—or at least the draft framework for illustrative purposes, which is all that we have seen so far—falls far short of those models. Despite promises about working across Government, its governance structure is heavily Department for Education-centric. There are no formal mechanisms for co-ordination with other key Departments; there is no cross-departmental board representation; and there is no clear structure for aligning with bodies such as the Migration Advisory Committee, just aspiration. Are we to assume that the Government think that skills policy is not so critical to their mission that it warrants a stronger framework than the one we have seen?

This matters profoundly when we consider the scale of cross-Government co-ordination required. Skills England must work with the Industrial Strategy Advisory Council on future workforce needs; with the Migration Advisory Committee on reducing reliance on overseas workers; with the Department for Energy Security and Net Zero on green skills; with the Department for Work and Pensions on employment programmes; with the Department for Science, Innovation and Technology on priority sectors; and with the Department of Health and Social Care on workforce planning. Particularly in light of recent developments, Skills England must also support the Government’s strategy for defence and the critical industries and skills that we will need for our defence. As proposed, though, it will lack even director general status, meaning that it will struggle to drive the co-ordination of skills that the system so desperately needs.

[Sir John Hayes]

The hon. Gentleman is making a powerful case for the independence of Skills England. He will know that Government Departments resist independence like most people resist disease, but his point is important because to get the kind of lateral action he describes in respect of the nuclear industry or other industries, it will be necessary for the body created to have a reach that Government Departments do not tend to have.

[Ian Sollom]

I agree. That cross-departmental and cross-industry working is a critical reason for the need for a truly independent body.

The implication for standards development is also concerning. Where we have had employer-led trailblazer groups setting standards, the Secretary of State can now bypass employers entirely. In limited circumstances and for minor changes, that will have the benefit of speeding up the review process, which has been frustrating for employers. There are, however, no safeguards to prevent ministerial control becoming the default approach. Instead of giving businesses a structural role, maximising responsiveness, the Bill makes engagement merely consultative. That speaks to a broader point: Skills England’s credibility with employers will be key if those employers are to buy into the Government’s skills vision for the country. Has the Secretary of State not at least considered the possibility that the proposed structure, whereby programmes can be driven at her whim or those of her successors, undermines that much-needed credibility from the start?

The Government’s own impact assessment worries that there will be a

“slowdown in the growth rate of new apprenticeships and technical education courses due to potential delays in the approvals process”

caused by this new approach, and it reveals who will pay the price. It is adult learners, who make up 48% of apprentices and often face the greatest barriers to retraining; learners from our most deprived communities, whose achievement rates are already eight percentage points lower than those from affluent areas; and learners in regions such as the north-east, where apprenticeship starts are already lower and where every reduction in opportunity has a disproportionate effect.

[Mr Perkins]

I see that the hon. Gentleman has received the briefing from the Association of Employment and Learning Providers. He appears to be reading it virtually word for word; I do not know whether he contributed anything to the speech, but it has been very interesting to hear what he has said.

With the Bill having been through the House of Lords, the hon. Gentleman is proposing a wrecking amendment that would kill it. Although I sympathise with some of the points in his amendment, does he not think that with the reassurances that we have heard from the Secretary of State—which can be scrutinised over the course of this Bill’s progress—we can at least get Skills England set up at speed, so that it can take on the shape he is suggesting in future? The hon. Gentleman’s proposed approach would cancel all this reform. It would go right back to square one and stop reform dead in its tracks.

[Ian Sollom]

I have looked beyond the AELP briefing, thank you very much. This is a critical area of Government policy, and it is important to get it right from the start. That is just a difference of approach.

As my noble Friend Baroness Garden said in the other place, this looks like an innocuous little Bill, but there is so much more to it than meets the eye. It represents a fundamental shift away from employer leadership in our skills system towards ministerial whim, a shift away from statutory independence towards departmental convenience, and a shift away from proper parliamentary accountability towards rule by regulation. The Government may argue that this is just an enabling Bill to pave the way for Skills England, but that is precisely the problem. It enables the wrong thing—it enables centralisation when we need independence, it enables ministerial control when we need employer leadership, and it enables opacity when we need accountability.

[Andrew Pakes (Peterborough) (Lab)]

The hon. Member and I share a county, and he will be aware that in a place such as mine, we have seen the decimation of level 2 and 3 apprenticeships. Does he not recognise that the biggest concern I hear from employers is that the current system is centralised and letting down working-class families in seats like mine? What they want is Skills England. No employer has been to see me to speak against Skills England, but many have been to speak to me against the current system, because it does not give us flexibility. What might be all right for academic policy in Cambridge will not be all right in Peterborough. We need the change delivered now.

[Ian Sollom]

I point out that I represent St Neots, which is not Cambridge, and many employers have spoken to me about their concerns about Skills England and the lack of clarity on its future.

We cannot support this Bill. That is not because we oppose reform—we desperately need it—but because centralising power in the hands of Ministers, removing proper scrutiny and weakening employer involvement in our skills system will make things worse, ultimately. Learners, employers and our economy deserve better than this overcentralisation of power.

[Gareth Snell]

Will the hon. Member give way?

[Ian Sollom]

I am going to finish now.

Learners and employers deserve a properly independent Skills England with the authority and accountability to drive real change. I urge the Government to think again and bring forward legislation that delivers the genuine reform that our skills system needs.

16:02

[Lee Barron (Corby and East Northamptonshire) (Lab)]

I speak today in support of this much-needed Bill, and I ask Members to do the same. This Bill is not just a piece of legislation, but the foundation for an English skills revolution. It will give our workforce the right tools to boost our economy, fix the skills shortages and provide real opportunities for millions across the country.

I started off as an apprentice when I left school at 16. The academic school did not work for me as far as my education was concerned, but the apprenticeship gave me opportunities that I could not have otherwise reached. It got me into the world of work. It got me active and away from a desk, and it led me on to a path that, frankly, the classroom could not provide. For too long—this has already been said today—vocational qualifications have been looked down on and seen as second-rate, but they allow people to reach their full potential in a way that fits in with them.

This Bill is a crucial step in delivering the Government’s manifesto promise to set up Skills England, which will take a smart, joined-up approach to ensuring our workforce has the skills our economy needs. By bringing businesses, training providers, unions and local leaders together under one roof, we can finally build a system that works for everybody. Skills England will map out where we are falling short, make sure training fits with what businesses actually need, and oversee the new growth and skills levy, which will replace the existing apprenticeship levy. This means that businesses can put money into the right training at the right time, leaving both workers and employers with more.

Let us be honest: we are in a skills crisis. In construction, health and social care, engineering and digital industries, we simply do not have enough trained workers, which is why we have to move so speedily. According to the 2022 employer skills survey, more than a third of job vacancies are a result of people not having the right skills—the skills that we need—and that is not acceptable. We cannot allow a lack of training to hold our economy back, which is exactly what is happening at the moment. The Bill will ensure that apprenticeships, T-levels and technical qualifications match what employers need. Whether those involved are young people starting out or adults reskilling, they will know that they are on the path to a stable, well-paid job.

We must not ignore the damage done by those who look down on vocational training. We need to change the way in which we talk about skills, apprenticeships and lifelong learning, because those careers are not a back-up plan but a first-class route to success. The Bill represents a move to challenge the idea that the only way to get ahead is through university. It shows that we are serious about supporting technical skills so that no matter what path people choose, they have what they need to thrive in life and in work. I say to Members, “Ask yourselves this: do you want a skills system that actually works? Do you want to help build a workforce that is properly trained, valued and paid?” This Bill is our chance to fix skills training in England. It will give apprenticeships and technical education the attention, funding, and respect that they deserve. It will bring order, clarity and proper co-ordination, elements that our system has been lacking for too long.

In September I visited Corby technical school in my constituency, which is led by Shona Lomas. I was told about its approved partners scheme, a leading scheme in the area, which brings in business partners who support children through school, offer work experience and provide apprenticeships. When that school opened, it was looked down upon. It was talked down. People talked as though the kids who were not bright enough went to that school. That is wrong, because the kids who go to that school are well supported, getting on with partnerships and getting on in life through apprenticeships. The CTS scheme has now grown to 119 partners, including local schools, colleges and major local employers, and it has seen a rise in awareness and interest since the recent National Apprenticeship Week. Opportunities such as those give young people the skills and confidence that they need to get on in life.

We have more brilliant apprenticeships schemes throughout my constituency—some of which I visited recently—including those at 7formation, Asda, Carmack Engineering, Weetabix and RS Components, which was ranked 82nd in last year’s list of the top apprenticeship employers in the country. Those businesses are delivering what they can, but the Bill gives them the freedom and flexibility to deliver more. Most important, it provides the links that will enable us to build the future and the growth that our economy needs. These are the kinds of opportunities that we can grow and spread through Skills England and the powers in the Bill. Let us get our system in step with an industrial strategy, joined with local economies, to bring the skills revolution that our country so desperately needs. We can do that with the Bill.

16:08

[Sir Ashley Fox (Bridgwater) (Con)]

This Bill is important for the future of technical education and apprenticeships in our country, and I accept that the Government’s intention is to streamline the governance and management of skills. However, I believe that, in its current form, the Bill threatens to centralise the system to such an extent that it may undermine the independence and effectiveness of our skills system.

The Institute for Apprenticeships and Technical Education was established with the clear purpose of ensuring that apprenticeship standards and assessments were determined with the input of employers, education providers and industry experts. I fear that by abolishing this body in favour of a group of civil servants appointed by the Secretary of State, the Government will make technical education less responsive to the needs of the labour market. The Bill removes the requirement to publish regular reviews of occupational standards and apprenticeship assessment plans. The Government say that removing this duty allows for much greater flexibility, but they are doing so without ensuring that the views of employers, educators and other relevant bodies will continue to be heard and considered.

The Bill grants the Secretary of State power to determine the standards and assessments that will be used to measure progress in technical education. No longer will these decisions be made by a broad group of stakeholders, including employers and sector specialists. What does all this mean for our workforce, and what does it mean for learners? It means that we are at risk of creating a system that is more distant, less responsive and potentially less effective. When decisions are made by civil servants without the input of those on the ground—those directly impacted by these decisions—we risk losing touch with the realities of the skills landscape.

[Luke Murphy (Basingstoke) (Lab)]

I am afraid the hon. Member and the shadow Secretary of State speak as if the Institute for Apprenticeships and Technical Education was an unblemished success. Between 2018-19 and 2023-24, apprenticeship starts in England per capita dropped by 16%, so how is it a responsive system? I think the House would be better served if Opposition Members acknowledged that. I understand why he is focused on structures, because that is in part what the Bill focuses on, but surely we should also be focused on outcomes, on which the previous Government were not delivering.

[Sir Ashley Fox]

The pandemic clearly had something to do with that reduction. I would not say the system is perfect, but I fear that replacing it with a committee of civil servants appointed by the Secretary of State is likely to be less successful still.

Amendments have been made in the other place to address some of these concerns. Specifically, a one-year delay was added between the establishment of Skills England and the commencement of the Bill, which would allow for a more effective transition and give Skills England a better chance of getting up and running. It is crucial that we do not damage the very real progress that was made on technical education under the last Government. During the general election, my party pledged to raise the number of people in high-skilled apprenticeships by 100,000 per year, representing a 30% rise. This was to recognise that, for many young people, apprenticeships represent a better way to enter the workplace than some university degrees.

Bridgwater and Taunton College, based in my constituency, is the UK’s largest provider of apprenticeships, supporting thousands of learners in achieving their career ambitions. With over 120 apprenticeship programmes, the college offers exceptional opportunities for individuals to gain hands-on experience and develop the skills needed for today’s competitive job market. BTC’s success is reflected in its recent achievements, such as its registered nurse degree apprenticeship, which recruited 53 apprentices in the 2023-24 academic year alone. The college’s commitment to employer engagement and industry-aligned training is at the heart of its success. It has strong partnerships with employers of all sizes, ensuring that its apprenticeship programmes meet local and national skill needs.

While BTC welcomes the streamlining of the management of apprenticeships, it is clear that these changes must not reduce the quality of education and support provided to apprentices. As it rightly points out, it is crucial that these changes do not compromise the wellbeing of students or the high standards of education they have come to expect. I hope that the new framework will continue to uphold these standards and ensure that the needs of both students and employers are met effectively. It is this type of local, industry-focused and employer-engaged approach to skills training that we should be fostering.

In conclusion, while I understand the desire to create a streamlined, more efficient system, the Government must be careful not to sacrifice the effectiveness and independence that have been the hallmark of our apprenticeship and technical education system. This Bill, in its current form, grants perhaps too much power to the Secretary of State with too little accountability. It risks diminishing the role of employers and learners, and weakening the checks and balances that have served us well, so I will continue to scrutinise this Bill as it proceeds through Parliament.

16:14

[Gurinder Singh Josan (Smethwick) (Lab)]

I am pleased to speak on Second Reading of this Bill, which I welcome for its focus on overhauling the skills system in England, particularly in relation to apprenticeships and technical education.

The creation of the Institute for Apprenticeships in 2017, with the subsequent addition of oversight for technical education, undoubtedly helped to create a system that increasingly includes higher-quality apprenticeships and increases the accessibility of these pathways to all. However, there are still too many in our country for whom unlocking their full potential remains a distant dream, which is fundamental to everything this Government have set out to achieve and to the future of our country.

The missions driving this Government—the incredible plan for change, the drive to become self-sufficient as a nation on energy, defence and security, the need to increase growth in our economy, and the drive to improve the lives of all our citizens—all require a comprehensive plan for improving skills. The basic provisions of the Bill will abolish the Institute for Apprenticeships and Technical Education and transfer its functions ultimately to Skills England; there are also proposed changes to the functions undertaken by Skills England. I believe these changes are important and will help to ensure a more simplified system with built-in flexibility, which will enable the skills system to take account of changing circumstances.

Conservative Members have spoken about the powers being taken up by the Secretary of State and the Department. I think building in accountability is important, so that we know that this Parliament can come back to Ministers and hold them to account on that. All this, I think, will help to ensure that our skills system is truly responsive to the needs of users, employers and our economy.

This matter is incredibly important to my constituents. Smethwick has a rich industrial heritage, and, while there have been significant changes over the years, the need for high-quality skills, education and training remains key. In Smethwick, significantly more people than the national average have no qualifications, significantly fewer have a level 4 qualification, and fewer than the national average take part in apprenticeships. Too often, structural inconsistencies hold back our businesses and our people from flourishing. The lack of skills essential for work, the lack of specific skills required by employers in the place they are needed and the lack of options available to many for achieving these skills are just some of those issues. The Bill will help to streamline the skills system and ensure it is able to identify gaps, respond to changing circumstances and provide the skills needed for our businesses to flourish.

Last week, I met Robert Powell, the head of resource development at Keltruck Limited, which is the largest independently owned Scania distributor globally involved in the sale of new and used trucks, and is based in my constituency. Keltruck is a significant business, with 461 employees, including 51 apprentices—that is more than 10% of its employees. I was also informed that pretty much all the senior staff in the organisation have come up through the apprenticeship route—this is a business that really values apprenticeships. Many of its apprentices go on to great jobs in industry, for example, one went on to become chief mechanic at a top Formula 1 racing team. That is something to aspire to, and a story for somebody from Smethwick that is quite inspirational.

Being more responsive means listening to businesses. While Keltruck welcomes the recent announcement that English and maths qualifications will not be a requirement for apprenticeships, it is concerned that this requirement still applies to 16 to 18-year-olds beginning an apprenticeship. The story that was told to me was that some of their senior staff would not be in that position if they were required to have an English or maths qualification at age 16 or 18. I hope the Government can therefore look at that too to ensure that all our young people have access to the best quality apprenticeships.

In an illustration of the flexibility and freedom that can be brought to bear, I congratulate Richard Parker, the Mayor of the West Midlands, and the West Midlands combined authority on launching a scheme last year to enable bigger businesses with an unspent apprenticeship levy to donate that to the West Midlands combined authority rather than returning it to His Majesty’s Revenue and Customs. That has allowed the West Midlands combined authority to receive nearly £3 million to support 176 small and medium-sized enterprises and 411 apprentices through fully funded apprenticeships. That is an indication of how the freedoms brought about by the Bill could be utilised.

The two examples I have outlined show what can be achieved through a skills system that is more flexible and responsive, as well as being focused on excellence. That is incredibly important to my constituency and I therefore have no hesitation in supporting the Bill.

16:20

[Damian Hinds (East Hampshire) (Con)]

We cannot just wish it into being, we cannot assume it or assert it, and we cannot legislate for it: esteem is in the eye of the esteemer and parity of esteem is earned. In technical and vocational education and training, that requires a clear and understandable set of qualifications with high standards and specifications that people know cannot be fiddled because they have been set independently. It also requires equipping the individual with what they need to know and what they need to be able to do to succeed in a trade, craft or sector because those standards have been set by employers in that trade, craft or sector.

Those things were at the heart of the blueprint set out for technical and vocational education in this country, which has been followed for the last number of years. I say the blueprint, but it was also a red print, because it was the vision of Lord Sainsbury, a Labour peer. In his landmark report, he set out that we needed to reform the system so that we had a streamlined set of qualifications with clear paths to vocations. His recommendations included: a minimum length of time for apprenticeships, along with a minimum length of time off the job; for T-levels, a minimum length, which was much longer than usual for industrial placements; and standards set by employers. There was also the expansion of the remit of what was then the Institute for Apprenticeships to become the broader Institute for Apprenticeships and Technical Education, linking apprenticeships and T-levels. Lord Sainsbury was also absolutely clear that specifying standards was not a job for Ministers in the Department for Education. It was a job for employers in the industries that would employ those apprentices.

We thought that those principles had become a matter of cross-party consensus. I am sorry to say that we were wrong. We have already had from this new Government a rowing back on the streamlining of qualifications. They have said that they will have shorter apprenticeships but still call them apprenticeships. Now, in the Bill, they will abolish—not reform or evolve—the body that is independent of Government, which sets the standards and ensures the integrity of the system.

Over 50 years in this country, we have had industrial training boards, the Manpower Services Commission, the Training Commission, training and enterprise councils—TECs—which were different from another TEC, the Technician Education Council, which existed alongside the Business Education Council, or BEC. BEC and TEC would eventually get together to give us the Business and Technology Education Council, or BTEC. There were national training organisations, the Learning and Skills Council, sector skills councils, the UK Commission for Employment and Skills and the Skills Funding Agency, or SFA, which would later become the Education and Skills Funding Agency, or ESFA. Lately, we have had local skills improvement plans and IfATE.

Now we will have Skills England, which will be the 13th skills agency in 50 years. I say to Ministers that if all it takes to solve our skills challenges is a new body, a machinery of Government change, do they not think that one of the previous 12 would have managed that already? Ministers, especially those in new Governments, like to create something new, and, in this case, they think that they have something new that business wants, which is a quango—except Skills England is not even a quango. I am grateful to you, Madam Deputy Speaker, for indulging me thus far in talking about all these things, because none of them is in the Bill. This Bill is not about Skills England. There are, I think, two mentions of Skills England in the text of the Bill and I think that they were both inserted by the House of Lords.

This Bill is about abolishing the independent institute that sets standards and passing those powers not to Skills England but to the Secretary of State. That is what Skills England is. Ministers are bandying about all these fancy terms about agency this, and agency that, but it is part of the Department for Education. When it comes to working across Government, I have no reason to believe that this new part of the DFE will be any more equipped to work across Government, let alone across the whole economy, in solving some of these issues.

I love the Department for Education deeply, but, honestly, to operate across Government, to exert leverage and to get things done, I am afraid that the new body has to be in the Treasury or possibly in the Cabinet Office—not in the Education Department, the Business and Trade Department, or some of the others that could have been picked. Therefore, far from reflecting what business needs, what this legislation does is remove the requirement for business to set the standards for what their future employees will learn.

Following the vote in the House of Lords, the Government say that they will amend the Bill to be clear that they will still listen to business. I have the amendment here. What it says is that they will be clear about the times when they will listen to business and when they will not, which is not quite the same thing. In any case, if we are to make use of that business voice—if it is really going to mean something—it has to go hand in hand with the independence of the body. As things stand, even if the DFE is listening to business, it will still be the convenor. There will be no other body. Therefore, it will be the Government who are setting the standards for T-levels and for apprenticeships. I have asked the Minister this question twice already. We would not allow the Department for Education to set the standards for A-levels. We would always have that independently done and verified. Therefore if we would not let it happen for A-levels, how can it be right for T-levels? That is a rhetorical question, but it is a rhetorical question that Ministers should try to answer.

Baroness Smith of Malvern set out all the things that were being done to make Skills England something other than just another unit—a mini department—within the DFE. Today, the Secretary of State has set out some of her appointments, which sound like good appointments, to that body. But none of that is in legislation. That was all news to us. News of this set-up and the appointments of these individuals has come out since the announcement of Skills England. We are voting over the course of the next few weeks, as the Bill passes through its stages, on what will be an Act of Parliament. All that Act of Parliament will say is that those powers are coming to the office of the Secretary of State for Education, and it will be for them to decide in the future how to use them. It may well be that this team of Ministers is in power for 25 to 30 years, or it may not. I encourage all colleagues to think about that. When we legislate, we do so not just for the next 12 months, or even for the next four or five years; we legislate the law of the land, which, all other things being equal, stays in place.

I have some good news. I confidently predict that the Government will hit all their targets on the numbers of young people going through technical vocational education and training and attaining. That is because I think back to the 2000s, and the key target of more children getting five or more GCSEs at grade C or above, including in English and maths. Year after year they made that happen, even though, as we knew subsequently, we were tumbling down the international comparison tables. About a dozen different ruses made those figures look better every year, and that was achieved even without having final control over the specification and what counted as passing or getting a particular grade. Let us imagine what the Government could achieve now.

The Government want a new body—fine. But to give it a chance to succeed for our economy and, crucially, for the young people who this ultimately is about, that body must be independent. I call on Ministers to take the opportunity, as this legislation goes through the House, to write that on the face of the Bill. We were encouraged by the Secretary of State saying earlier that, in any case, within two years they will review the status of Skills England with a view to perhaps making it a statutorily independent body. I encourage Ministers to take the opportunity in Committee to write that into the legislation.

16:31

[Anna Gelderd (South East Cornwall) (Lab)]

I welcome the Bill’s commitment to broadening educational opportunities and skills training, which is so urgently needed. As one of those young people who undertook my qualifications in the early 2000s, I assure the right hon. Member for East Hampshire (Damian Hinds) that they were rigorous and got me where I am today.

Areas such as South East Cornwall have felt forgotten and left behind, cut off from the opportunities of economic growth in other parts of the UK. Labour understands the link between an individual’s education and training and the wider economic prosperity of our country. The Bill is an example of how we are rebuilding the country from the ground up, focusing on our young people. Where university or academic routes are not the right fit, apprenticeships offer vital, valuable alternatives not only for those enrolled, but for training providers, local businesses and the economy.

Where someone is born and the circumstances in which they grow up should not limit where they go or what they achieve. This mission-driven Labour Government are making education a priority. It is a far cry from the previous Government, which saw apprenticeships collapsing, businesses pleading for change and our young people paying the price. In South East Cornwall, local businesses lead by example. Wildanet, a home-grown company from Liskeard, is doing fantastic work to improve digital connectivity across Cornwall. It is investing in more than just cables and infrastructure. It is investing in our local people through training schemes that create meaningful opportunities for local residents and build the skills that directly benefit my community.

During National Apprenticeship Week last week, I had the privilege of attending Wildanet’s apprenticeship graduation ceremony. Celebrating the achievements of our young people was a reminder of what is possible when we support them through businesses such as Wildanet and through the Bill. Working in partnership with Truro and Penwith College, Wildanet’s ground-breaking apprenticeship scheme is a key part of the company’s DNA, creating new jobs and training people locally. It is vital that such opportunities in rural communities continue to build momentum, and that is what the Bill will deliver.

The Bill is a step in the right direction. I want to highlight the brilliant work of Truro and Penwith College, Cornwall’s only expert apprenticeship provider and one of just five further education colleges in the UK that have been awarded this status by the Department for Education. The college’s staff, many of whom are resident in South East Cornwall, play a crucial role in shaping our local workforce and improving opportunities. Apprenticeship courses aligned with the Government’s mission and key industries will help people secure reliable, high-quality employment after completing their training.

In Cornwall, where incomes remain about 20% below the national average, this investment in skills and future-proofed jobs is essential. By strengthening our apprenticeships system, we can equip the next generation while also supporting local businesses such as Wildanet.

Cornwall was a driving force in Britain’s first industrial revolution. With the right foundations, we can once again lead the industries of the future, whether in renewable energy, marine technology or digital infrastructure. The first step is building those foundations.

16:35

[Sir John Hayes (South Holland and The Deepings) (Con)]

Much of this debate has been about the purpose of learning—the Secretary of State began in that spirit—and I think we can all agree that the purpose of learning is both to deliver personal fulfilment, through the acquisition of understanding and competencies, and to fulfil a social purpose by providing for economic needs. John Ruskin said:

“The first condition of education is being able to put someone to wholesome and meaningful work.”

Apprenticeships embody—indeed, they epitomise—that purpose. A trainee learns from a mentor a skill that has use in a workplace.

The value of apprenticeships is why, when I was shadow Minister for universities, further education and skills, and subsequently the Minister in 2010, I set about revitalising the apprenticeships system. I knew that apprenticeships were well understood by employers, were widely recognised by the public and could be attractive to trainees.

I will make a point on adult learning, provoked by the excellent contribution by the Liberal Democrat spokesman, the hon. Member for St Neots and Mid Cambridgeshire (Ian Sollom). It is vitally important to understand that in order to skill our workforce and provide it with the necessary competencies to meet the Government’s economic ambitions, we really do have to reskill existing workers as well as making practical and vocational education attractive to new entrants to the workplace. Simply as a matter of numbers, if we train more young people but do not retrain the existing workforce, we will never deliver the capacity needed to fill the skills gaps and deal with the skills shortages that, as has been said repeatedly, inhibit our ability to drive the economy forward.

The Bill is about the management and maintenance of standards of apprenticeships. I understood why that mattered so much, which is why I set about elevating the practical, the vocational and the technical. I believe that practical, vocational and technical learning is as important as academic accomplishment. It has been a myth perpetuated by the establishment—I am inclined to say “the liberal establishment,” but I do not want to damn the hon. Member for St Neots and Mid Cambridgeshire, having praised him so nicely—that the only form of prowess that counts comes through academic learning. That myth has been so pervasive that a former Prime Minister, Tony Blair, set out the extraordinary, bizarre ambition that 50% of people should go to university.

The number of people who go to university should be about their tastes, talents, aptitudes and abilities. We should not set a target and then shoehorn people into a system in order to meet it; we should allow a system to reflect those aptitudes, tastes and talents. Many people’s abilities rightly lead them not to an academic education but to a practical one, yet we have underpowered and undervalued practical learning for so long in this country, and we continue to do so.

Deep at the heart of that fault has been the careers service. As hon. Members have mentioned, the careers advice and guidance that people have got has guided them—even when it did not suit them—into an academic route that has ill-served them. Even though it has landed them with immense debts, it has rendered them unable to get the job that would allow them to pay off those debts readily. So it is really important that we look again at that advice and guidance.

As I have mentioned, when I was the Minister I created a statutory duty on schools to offer independent advice and guidance, but I should have insisted that it was to be given face to face, with a careers adviser visiting a careers fair or holding personal interviews with students to set out the various options available. Unfortunately, teachers, who have typically been to university themselves, know that route well, and they are inclined to say to young people, “Why don’t you do what I did, and follow the route that I took?” They are often less well informed about the practical and vocational routes that would lead people to acquire the kinds of skills that, as we have all said, are vitally important.

I should, at the outset of my remarks, have referred Members to my entry in the Register of Members’ Financial Interests, because I am associated with universities. Indeed, I ought also to say that my background is entirely academic. I studied at two universities, Nottingham and Cambridge, and I have taught in two as well, so I do not really have any practical skills myself, unlike my dear father, who could turn his hand to almost anything—there was nothing he could not do, practically. I have to send out for a man in the village if I want anything done. So my case is not born of any personal prejudice. Indeed, maybe it is born of a certain envy of those that can make and do things in the way that Ruskin described.

[Mrs Sureena Brackenridge (Wolverhampton North East) (Lab)]

Will the right hon. Gentleman give way?

[Sir John Hayes]

I will happily give way. The hon. Lady is now going to test me on my practical incompetence.

[Mrs Brackenridge]

I have a couple of points to make. Does the right hon. Member acknowledge the important role that universities play in supporting technical advanced education? Does he also agree that, under the stewardship of the last Government, we saw a decimation of specialist careers guidance in schools?

[Sir John Hayes]

Yes, of course I acknowledge that role. It is important to point out that many of the universities do great work. I would not want to disparage that work, and the hon. Lady is right to draw the House’s attention to it.

The point I was really making is that, sadly, many people are driven down a pathway that is just not right for them. That is because of the underestimation of the significance of practical accomplishment, both at an intellectual level—the unwillingness to recognise that practical accomplishment is of a high order—and at a practical level in terms of the advice that people are often given and may later regret. It is not easy for a young person to know quite what path to take, and if the advice they get skews them towards one route or another, it is fairly likely that they will be ill equipped to make a considered judgment. I am simply making the argument for, at the very least, a degree of equality about the advice we give to people.

This Bill is questionable in a number of respects, and in particular, as has been highlighted by my right hon. Friend the Member for East Hampshire (Damian Hinds) and others, in the way that it presents the future management and control of apprenticeships and the standards associated with them. It is right that employers play a key role in that process, but the Bill is silent on the role of employers.

I am not an unbridled admirer of the Institute for Apprenticeships. I did not create it. In my time as Minister, and indeed as shadow Minister, the standards were guaranteed by sector skills councils. I would have gone for a sector-based approach myself. Had I stayed in office, I would probably have developed that further and emulated the German approach by establishing guilds. I began to lay some of the foundations for that as Minister, and I would have gone for such an approach rather than where we ended up. Having said that, what is critical about either that kind of sectoral approach or the apprenticeship institute being abolished by the Bill is the role of employers in ensuring that what is taught and tested meets a real economic need. We cannot detach that economic need from the structure by which we guarantee the quality of apprenticeships.

So, there is the issue of quality, and again the Bill is unconvincing in that respect. My right hon. Friend drew attention to the fact that if quality is lowered, the numbers can be increased. Indeed, the Labour Government prior to 2010 introduced programme-led apprenticeships, which were taught entirely outside of the workplace. They were still called apprenticeships but were unrelated to any particular employer or sector. That is not the way forward, and any diminution of standards will further undermine the status of practical learning. I simply say to the Minister that if the Secretary of State is going to take back control—to borrow a popular phrase—it is vital that simultaneously we hear more during the passage of the legislation about how standards will be maintained, because at the moment we have few assurances to that effect.

I will say a word on numbers, partly to advertise my own effectiveness in government. When I became the Minister of State for Further Education, Skills and Lifelong Learning, I was able, due to the promotion of apprenticeships, to drive their number to the highest level in modern times. I became the Minister in 2010. By 2011/12, we achieved 521,000 apprenticeships. That has never been equalled since, and we are now down to about 340,000. To say a word about previous Labour Governments, I inherited 280,000 apprenticeships, and the average number of apprenticeship completions from 2000 to 2009-10 was less than 100,000 a year.

As we debate these matters going forward, it is vital that the Government commit to the apprenticeship as a key determiner of their skills policy. The number of apprenticeships and their quality will allow the Government to drive up skills levels and, therefore, to meet economic need.

[Andrew Pakes (Peterborough) (Lab)]

Will the right hon. Gentleman give way?

[Sir John Hayes]

I am grateful to the hon. Gentleman, who has been listening attentively to my speech so far.

[Andrew Pakes]

I am worried that I might damn the right hon. Gentleman with faint praise because when he cited the numbers from when he was the Minister, one of the determinants of his success was the involvement of trade unions in the sector skills council and the partnership. While we have talked lots about employers, he was an advocate in his party of involving trade unions. Unfortunately, Ministers after him excluded trade unions from that involvement. Is he advocating that trade unions should be involved in the new system?

[Sir John Hayes]

I am immensely flattered that the hon. Gentleman has followed my career with such assiduity. He is right: I defended Unionlearn and would continue to do so. Trade unions can play a vital part in ensuring the outcomes that the Government say that they seek and that I certainly believe in. Indeed, I went on a delegation to Germany—this is a minor digression, Madam Deputy Speaker—to look at their apprenticeship system with employers and trade unions, because I know that the combination of trade unions and employers was critical to driving the skills agenda. Again, it would be useful to hear from the Government what they think about that. How will they engage with the trade unions? Because trade unions are not mentioned in the Bill at all, we are left to wonder what will happen, as my right hon. Friend the Member for East Hampshire said in his excellent speech, when the Secretary of State seizes control of apprenticeships from the current structure.

There are a number of other questions to be put. The hon. Member for Chesterfield (Mr Perkins) made a very good point about SMEs. One challenge when I was a Minister, and for subsequent Ministers and this Government, was in engaging more SMEs. I am not sure that we were successful in that. I launched a review of how we might do that; it was typically by making the system regulatory and trying to review some of the paperwork. Again, as the Bill moves forward, what more will we hear about how to engage more SMEs? If we say to someone in my constituency that there are really good engineering apprenticeships in Derby, which I am told is in the same part of the country—or in the same region at least, whatever that means—we might as well be saying that there are apprenticeships on Mars, because they will not be able to get to Derby to study. We really need the spread of apprenticeship accessibility, which SME involvement provides. It is the only way of creating the reach that is necessary to engage more young people and adult learners in acquiring those skills.

I have one or two further questions, with which I hope the Minister can deal. I have already spoken about employers. On the status of the new body, is it the Government’s intention, as the Secretary of State implied— but no more than that—for it to become a non-departmental body in the end, or will it always be an in-house body? Anyone who has been close to government will know the significance of those two options. It needs at the very least to be a non-departmental body if it is to have the necessary freedom and independence to respond to employer need and changing economic circumstances. The Secretary of State hinted that that might be the direction of travel, but we do need to know more when the Minister sums up.

[Luke Murphy]

Conservative Members are making quite the noise about IfATE’s independence, but I remind the House that this is a precedented move. The Conservative Government established the Standards and Testing Agency, which is currently the Executive agency and was formerly a non-departmental body. That is exactly the same status as IfATE, which performed very similar functions for many other kinds of qualifications and tests. Why was it okay for the right hon. Gentleman’s Government to do that in 2011? It seems that the Conservatives are more focused on the process point—a process similar to that undertaken by their Government—and not on the outcomes that will deliver for working-class kids interested in learning a trade.

[Sir John Hayes]

As I say, I am not an unbridled advocate of the Institute for Apprenticeships and Technical Education, which the Bill abolishes. I did not set it up during my stewardship. As I have already described, I would have preferred a different, guild-based model. Guilds would, by their nature, have been independent from Government. If we look at the German model, the guilds are sovereign, and they are closely tied, by the way, to the trade unions of the particular sectors for which they are responsible. I am simply saying to the Government, “Here is the chance to do something better.” One learns from experience and one learns from government experience, to be honest and straightforward about that.

Certainly, there is the issue of standards. How will standards be determined and delivered? Will that be done by an independent body or a series of independent bodies, perhaps in different parts of the business community, or will it be done directly by the Department? What about the figures in the impact assessment, which says that there would be a reduction in the number of apprenticeships? We are already at a pretty pitifully low level. As I described earlier, the number of apprenticeship starts in 2023-34 stood at 340,000. We can do much better than that, but the Government have certainly suggested in their impact assessment that they expect that number to fall, at least in the interim. By how much do we expect it to fall—5%, 10%, or 25%? We really need to know a little more about that.

The Secretary of State spoke about, as the Labour manifesto detailed, work with the Migration Advisory Committee and others. Can we hear a little more about the detail of that? Certainly, it will be required before we vote on Third Reading, because it is inconceivable that the Government would not want to be more straightforward about how those structural links will work and what role those other bodies will play in helping the Government to deliver their objectives.

Practical accomplishment is something dear to my heart. William Morris—rarely quoted in this House except by me, which is a sad indictment of the modern Labour party—said:

“a man at work, making something which he feels will exist because he is working at it and wills it, is exercising the energies of his mind and soul as well as of his body.”

Morris understood what I know many, from their contributions to this debate, understand too: that it is time to again elevate the practical. This is, of course, about our ambitions for the economy, but it is also about the people who acquire those skills—the way their lives are changed because their life chances are changed.

I started by speaking about John Ruskin and his view of these things. Ruskin said:

“The highest reward for a person’s toil is not what they get for it, but what they become by it.”

Yes, this is about the economy, but it is also about the difference we make to individuals who, through gaining new skills, grow and develop and become proud of what they can do for themselves, their family, their community and their nation.

[Several hon. Members rose—]

[Madam Deputy Speaker (Caroline Nokes)]

I had not been planning to introduce a formal time limit, but Members might reflect on how many are still standing and perhaps restrain themselves to five minutes or so.

15:39

[Darren Paffey (Southampton Itchen) (Lab)]

In rising to support the Bill, I want to say, without heaping too much praise on the right hon. Member for South Holland and The Deepings (Sir John Hayes), that it is a pleasure to follow him and many of the comments he made. Like him, I have arrived at this place through the academic route, and perhaps precisely because of that, I, like him, am incredibly aware of the value of the vocational, practical and apprenticeship route. It is in that value that the power of what the Bill is seeking to achieve lies, and I hope to return to that point. I thank the Secretary of State, who is no longer in her place, for bringing forward the Bill, because seven months ago this country voted for change, and what we see today is another building block of that very necessary change.

On a recent visit to Southampton college’s marine skills centre in my constituency for National Apprenticeship Week last week, when it seems we were all busy making visits, I met some apprentices learning a whole range of skills, from engineering to electronics, to carpentry and yacht making. It was truly impressive, mostly because I would be entirely useless at all those skills. It reminded me that investing in apprenticeships is one of the most effective ways that we can equip the next generation with the skills they need. I am pleased to see that, with this Bill, the Government are taking action to ensure we get the right framework in place to shape our apprenticeship system. What apprentices want and what employers need is a system that offers routes into those meaningful, secure jobs, full of the dignity of work, that will bring them success as well as grow the economy.

I am not particularly obsessive about the structure of things or the way in which Government Departments organise themselves to implement policy. Like most people, I want what works, and I want what works best. The truth is that what we have at the moment, however much Opposition Members try to dress it up, is simply not working for too many people. I am pleased that the focus of the Bill is on how we create an agency that will reduce the number of hoops to jump through and will, as my hon. Friend the Member for Basingstoke (Luke Murphy) said, focus on outcomes, what happens at the end of these training courses, and opportunities.

[Damian Hinds]

Which hoops is the hon. Gentleman looking forward to the removal of?

[Darren Paffey]

I think the best people to answer that would be the employers who, time and again, have been telling us—and, I am pretty sure, telling the right hon. Gentleman and his colleagues—about the pure bureaucracy and complexity of the system that has been set up. They are the best advocates of the need for change. By setting up Skills England we can give apprenticeships the flexibility and durability that we need, and that those training will need. Importantly, we can take the interests of employers and young people into account.

If the years since 2010 have taught us anything, it is that poor policy has consequences. Sadly, the IfATE structure set up by the previous Tory Government has failed to deliver and, alongside a lack of investment, that has left the UK with stubbornly high numbers of vacancies due to skills shortages and too many young people who are not in education, employment or training. I would welcome reflections from the Minister on how, at the same time as setting out the new framework and strategy for skills development, we can deal specifically with those not in education, employment or training, and whether a strategy specifically on that would be another jigsaw piece in resolving this picture.

Employers in Southampton Itchen are crying out for new trainees and employees, especially those with crucial, basic digital skills, but even today in this country about 7.5 million working-age adults lack those skills. Is that the golden Tory legacy that we keep being reminded of by Members on the Opposition Benches? All of that is changing with the structures that the Bill sets up, paving the way for Skills England. That will meet the skills challenges of today and empower all training providers and employers, including the excellent Kiwi Education and the South Coast Institute of Technology, to drive maritime, engineering, hospitality and digital opportunities in and around Southampton. It will also ensure that we reset the prestige of apprentices and the apprenticeship route, and elevate them once again to a place of real value.

I associate myself with comments from Members on both sides of the Chamber about the value of apprenticeship skills. I say that as someone who has paid my bills by being a university lecturer for a number for years, yet throughout my time in politics I have championed apprenticeship routes. A piece of paper at the end of something is pretty incidental, to be frank, because its real power is what it empowers someone to do and which doors it opens up. To return to the point made by the right hon. Member for South Holland and The Deepings, it is about what skills enable someone to be, and what they become through those skills. That is where the real value and prestige of apprenticeships lies, and that is why we are resetting the value of them.

If we want growth and a well-trained workforce, the Bill is a route to delivering that. With this Bill, and with action that I know Ministers will be taking in future, this Labour Government are widening options and breaking down barriers to opportunity for people in Southampton and beyond. That is why I will be proud to walk through the Lobby and vote for the Bill later today.

17:03

[Leigh Ingham (Stafford) (Lab)]

The Bill is a crucial first step in the reform of the Government’s skills system. This Government are changing the narrative around skills. When I was younger, apprenticeships were often seen as something for working-class kids and a route into traditional trades such as plumbing, bricklaying—like my dad—hairdressing or being an electrician. Although those trades remain vital—indeed, our ambitious house building targets rely on them—skills today can be about so much more. They are the foundations of our economy, our technological progress and our ability to compete on the global stage.

The Bill underpins the Government’s aim for apprenticeships not to be just for 18-year-olds fresh out of college. In my constituency of Stafford, Eccleshall and the villages, many apprentices are over the age of 25. In fact, the majority of apprenticeships being taken up are advanced qualifications. Those people know what they want to do, may already have years of experience and are looking to upskill, retrain and take their career to the next level. We need exactly that kind of dynamic, lifelong learning.

We cannot just talk about improving skills—we need real, structural reforms to make that happen. That is why the Bill is so important. In October last year, the Government carried out a detailed impact assessment, looking at how it will affect learners, training providers, businesses and staff. The conclusion was clear: the Bill is essential to deliver the manifesto commitment to establish Skills England on which I and many of my hon. Friends stood.

We cannot continue to make the same mistakes made by last Government by keeping the fragmented approach of a slow, inefficient skills system. We do not have time for that. We need a joined-up approach that delivers for people who are trying to build their future, and for employers who are trying to build their business. For that reason, I was concerned about amendment 15 tabled to clause 11 in the other place, which introduced a one-year delay between the establishment of Skills England and the commencement of the Bill. I worry that that will delay the establishment of Skills England, and negatively impact employers, learners and the economy. I hope that the Government can minimise the impact of that amendment in Committee.

Hon. Members will often hear me champion Newcastle and Stafford college, based in my constituency, one of a small number of colleges nationally to twice achieve an Ofsted outstanding rating in all areas, including apprenticeships. It was recently praised for its “strong contribution” to meeting local skills needs, which is incredibly impactful on our local economy. The Bill will only help to increase that impact.

More widely, Skills England will work hand in hand with industry, employees and training providers to ensure we are not just reacting to skills shortages, but proactively identifying them. For too long, we have had a sticking-plaster approach to skills—and, let us be honest, to everything else—but that must change. We need to be strategic, focused and ambitious in developing a workforce who are prepared for the future. The Bill recognises those needs and confirms the manifesto commitment that I proudly stood on. I am delighted to see it progress, so that people in Stafford, Eccleshall and the villages can better access training and, ultimately, better jobs. I urge all colleagues to vote for the Bill.

17:04

[Lee Pitcher (Doncaster East and the Isle of Axholme) (Lab)]

I and all my hon. Friends were elected last year on a simple promise: change. It was a promise to rebuild our country, economy, health service and infrastructure, and to lay the foundations for a brighter future where we will overcome the challenges of climate change, see the benefits of a green economy and lead the world in new technology. It will be a future of prosperity and opportunity for all. All of that—every mission the Government have set out—depends on a skilled workforce.

I have recently seen the diversity of apprenticeships in my local area, from the National Horseracing College in Rossington, to the SSE business in Keadby, to Jack who cuts my hair, who I am sure hon. Members will agree is supremely talented—a phenomenon. I just ruined his career, I think—sorry, Jack! Everything this Government have promised can be created only by having the right people, with the right skills, in the right place, at the right time.

Whether they are in the NHS, energy, house building or security, apprenticeships have been part of the fabric of British society for hundreds of years. They have made us the country that we are today. In the past, modern apprenticeships were met with great enthusiasm by both leaders and businesses. They represented a different way of learning and had great promise, but in recent years that promise has been unfulfilled. Both apprenticeship starts and, crucially, apprenticeship completions have fallen off dramatically. The current system is not working for learners, employers or our country.

We need a targeted and strategic system that works for everyone. The system must work with local leaders and businesses to be relevant to the skills gaps that are holding our economy back. We need partnership, but most importantly we need a system that inspires and empowers our teens and young people.

Both before and since becoming an MP, I have had the privilege to meet many of the young people in schools in my constituency. Their talent and ambition are outstanding. So many of them are raring to change the world to tackle the climate crisis, harness artificial intelligence and be part of a brighter future. All they need is the opportunity to succeed, and they will make us proud. That is what the Government have promised, and the establishment and progression of Skills England is at the heart of that promise.

Creating Skills England was one of this Government’s first acts, and it is already doing important work. This Bill is an important step towards fully empowering Skills England, reshaping the skills landscape and getting our economy growing. This Government’s No. 1 priority is growth and to get the economy working again not just in some places and for some people, but everywhere for everyone—for north and south, urban and rural and all backgrounds and abilities. The fragmented approach we have seen over the last decade has never been so evident in the lack of pipeline for skills that we need right now and in the future.

Skills and apprenticeships must be at the heart of that strategy. Too many industries are held back from their potential because of the skills shortages we see. So many of the challenges that this country faces are rooted in the skills gap. Our housing crisis is built on a huge deficit in skilled construction workers, our hospitals and care homes cannot get the staff they need to do much more than hold together a system on the verge of collapse, and our economic productivity crisis is rooted in far too many people who miss out on the opportunity to fulfil their potential, so they neither thrive themselves nor contribute to our thriving economy.

I have spent my life working with water and the land. Blue-green infrastructure is absolutely vital, and new, smarter ways to work with nature are developing constantly. As we transition to net zero and sustainable development and growth and develop green energy solutions, we open up a whole sector of future jobs. In the coming decades, jobs and the blue-green economy will be as important as factories and coal mines were in the industrial revolution. We must embrace that opportunity now and use Skills England and the apprenticeship system to get our people ready for jobs in an industry in which we lead the world once again.

Britain has never had the biggest population, the most land or the greatest supply of natural resources, but we have been able to lead the world for centuries because of the skill of British people. We lead through technology, innovation and craftsmanship and through our wonderful natural talent. Britain sparked the industrial revolution and became the workshop of the world because of the skill of its workers, and that is why I am really happy to support this Bill.

17:11

[Tom Collins (Worcester) (Lab)]

I am pleased to see that we have some young people observing us today. Before coming to this place, I worked in research and development, leading a team of talented young engineers who were creating and realising new technologies to tackle the climate crisis. Some of those team members were apprentices, and some had been apprentices earlier in their careers. We faced many challenges, not least from a regulatory environment that struggled to move quickly in innovation and in finding relevant qualifications for new and emerging fields. Some of those challenges are inherent in doing something for the first time, but they were also the result of a UK engineering and industrial sector that had been neglected and, in some places, allowed to stagnate by political leaders who simply did not get it.

I am pleased that this new Government have embraced the values of purposeful, mission-led goal setting alongside agility, partnership and a willingness to act and learn fast. Just like our regulatory environment, our education ecosystem, which delivers skills and qualifications, needs to become more agile and responsive, and this Bill is an early step in that transformation and in reviving the symbiosis of academia and industry in our nations.

Anyone who works in engineering knows that there is no employee quite like an apprentice. Apprentices embody some of the most valuable skills needed in the workplace, such as social competencies that fuel teamwork, empathy, excellent communication, shared purpose, critical thinking and problem-solving skills built on perseverance, experimentation and pragmatism and a can-do attitude backed by hard skills honed in the real world. I have had numerous meetings with our local colleges in Worcester, and they are champing at the bit to deliver the technical and vocational skills needed for the big transformations that our country faces in digital, clean energy and public services. They welcome our changes to reduce bureaucracy and lift demotivating and burdensome requirements for English and maths GCSEs, as well as the changes that we are beginning to make regarding shorter placements and funding bands. They want us to keep going; I have been asked whether we could look at industry-specific flexibility around English and maths for 16 to 18-year-olds, with requirements integrated into standards. I have also been asked about further reviews of apprenticeship standards and funding bands in a wider range of areas, such as hospitality and customer service, and they would like us to keep building on our partnership with the sector, providing clarity about future levy changes and level 7 so that they can plan more effectively.

I am pleased that this Government are making changes that provide the agility and freedom to act quickly and responsively. Innovations in our economy will be founded on innovations in our ecosystem of education and skills. We can see a creative, industrial and innovative renaissance in the UK, and I believe that apprentices will be in the thick of it, delivering the true power of a thriving economy: skills and passionate people. As such, I urge the Secretary of State and our Ministers in the Department for Education to continue this work at pace, and I would like to express the appetite and ambition that is present in Worcester to play our part in delivering the technical and vocational skills of tomorrow through apprenticeships. The people of Worcester are ready to back the Secretary of State’s mission and work in partnership with the Government to break down the barriers to opportunity and see our country—and every single person who makes it—thrive.

17:16

[Andrew Pakes (Peterborough) (Lab)]

It is an honour to follow such a passionate speech about apprenticeships from my hon. Friend the Member for Worcester (Tom Collins). I was going to thank the right hon. Member for South Holland and The Deepings (Sir John Hayes) for raising John Ruskin and William Morris in the Chamber—I certainly think they should be mentioned more often—but I will amend my comments to say that it would be nice to have some Opposition Members in the Chamber for this important debate.

[Laura Trott]

Hey!

[Andrew Pakes]

It is nice to have some—to have some more would be quite good.

Whereas we have had William Morris and John Ruskin, some colleagues seem to have been getting speechwriting advice from Lewis Carroll, because some of the speeches from Opposition Members have been through the looking glass in their description of the problems and what is happening. We are lost in a debate where people are stuck on the function of a body, rather than the purpose we are trying to achieve, which is to change and enhance people’s lives.

Before I continue, I must declare my interest. Alongside my hon. Friend the Member for Chesterfield (Mr Perkins), I am co-chair of the all-party parliamentary group on apprenticeships. Apprenticeships are my passion in this House and in life, so I certainly believe that the transfer of functions and assets from the Institute for Apprenticeships and Technical Education to the new Skills England body is an overwhelmingly positive move. It was a proposal made in our manifesto—another promise made and kept by this Government.

The rationale underpinning this Bill is simple enough: the scope of the institute was too limited, and it is letting too many people down. Vitally, Skills England will work with young workers on their learning journey, signposting them through the maze of qualifications and apprenticeship opportunities. More than that, it will identify the skills gaps in our economy and work with the Industrial Strategy Council and the Migration Advisory Committee to plug those gaps. This matters to me, because in Peterborough, we have some of the highest levels of youth unemployment in the country. Apprenticeship starts are down, and unemployment is up.

It is clear to me that the work of Skills England must be aligned with the new industrial strategy, something we heard too little about from Opposition Members in their discussions of this issue. It does not matter what structure we have if we do not have industrial purpose, which this Government will bring to our growth mission, but also to our mission to remove barriers and transform lives. We must have cross-departmental, cross-agency, joined-up working to deliver the skills revolution and take us out of the old silos. When the Minister replies to the debate, I encourage her to detail how the industrial strategy and new Skills England bodies will work together to create those transformational opportunities. I also invite her to talk about how the growth and skills levy will fit together with Skills England, enabling us to deliver on those ambitions.

Our No. 1 mission is economic growth, spread to every part of the UK and built on a diverse base of industries and services. That mission will be hamstrung unless we unleash a skills revolution. The first report of Skills England made that clear, and it shows the scale of the challenge. Employer investment in training has been in steady decline over the past decade, with training expenditure at its lowest level since records began in 2011. Investment per employee is down 19% in real terms. I know from talking to business leaders in my constituency that they find the qualifications landscape and the institute bewildering. They tell me that skills supply is often mismatched against demand and that there are insufficient ways to encourage employers to invest in skills. I know from talking to learners in my constituency that the journeys into careers are poorly signposted and often blocked. Learners too often lack the essential literacy, numeracy and digital skills they need prior to apprenticeships to get the jobs they need.

In short, we do not have the skilled workers to do the future jobs that will drive growth. This Bill goes a long way to addressing that by setting up the institution and the purpose to get us there. Apprenticeships are the golden thread that run through this Government’s ambitions for growth. The new Skills England must recognise the centrality of apprenticeships to that and bring them centre stage into our economy.

As so many others in the Chamber have discussed today, the breadth, talent and determination of the apprentices I have met has been humbling, whether that is the butchers’ apprentices in Newborough, construction apprentices at Laing O’Rourke building a new Olympia or creative learners at the Fashion Retail Academy. Recently, I was delighted to welcome engineering apprentices from Caterpillar in my constituency to talk to us.

These apprenticeships will give young people a clearer route into careers where the nation has skills gaps. The new levy we are talking about will fund short apprenticeships, giving learners and employers greater flexibility. Overall, we must elevate the status of apprenticeships in our society and culture. I am not decrying our universities, but we must end the snobbery that says an apprenticeship is second-best to a degree. We must tackle the outmoded idea that learning and earning is a lesser option for young people. We do not hear that lazy trope in Sweden or Germany, and we should never hear it here in the UK. My third question to the Minister is: how will Skills England work through this legislation to elevate the role of apprenticeships in our society?

Skills and apprenticeships are not only the engine of growth, but the ladder of opportunity. The Minister will have seen the excellent briefings on this Bill from the Co-operative Group, of which I am a member, and one of its central challenges is that we should not just be creating more apprenticeships, but ensuring that Skills England has a responsibility to improve outcomes for those from lower socioeconomic backgrounds, including working-class kids in my constituency. That will ensure that the new body has social mobility baked into it from its inception. That will not only deliver better outcomes for those from working-class backgrounds, but will encourage Skills England to thoroughly measure the impact. When the Minister responds to the debate, will she talk about how we will measure the impact in cities such as mine, as well as the country as a whole?

This is a wonderful Bill, and I am pleased to support it. I am pleased to put on record my support to the ministerial team, particularly Baroness Smith of Malvern in the other House, who has been kind with her time and brilliant with this Bill.

17:22

[Josh Dean (Hertford and Stortford) (Lab)]

My driving focus as the MP for Hertford and Stortford is to make our community an even better place to live, work and learn. I am delighted to speak in this debate today, and I have no doubt that the Bill will allow us to harness the talents of our young people through ambitious skills reform that will drive growth and unlock opportunity.

Our young people in Hertford and Stortford are keen to take advantage of these opportunities, and the confidence that apprenticeships instil in our young people cannot be overstated. Earlier this month, I had the pleasure of visiting the Hertford regional college’s Ware campus to mark National Apprenticeship Week. It was great to meet some of its talented hairdressing apprentices and hear how they are starting to fill jobs at small and medium-sized businesses in our local area and to learn more about HRC’s apprenticeship offer for my constituents.

In our community, we can see how apprenticeships are helping young people to find the path that is right for them, develop skills for life and drive the local economy, but for too long, those opportunities have been out of reach for too many young people in our area, leaving those for whom traditional education does not work, who want to pursue an apprenticeship or another form of education, to slip through the cracks. Apprenticeship starts crashed under the watch of the previous Government. A broken apprenticeships levy let down businesses and young people alike, and both are now crying out for change.

I am pleased that this Government will introduce a new growth and skills levy, enabling employers to access a broader range of higher quality training offers, providing them with more flexibility and helping learners to access opportunities that will improve their lives.

The Department for Education’s employer skills survey showed that about 36% of all UK vacancies in 2022 were skills shortage vacancies—a huge increase from 22% in 2017, and a clear indicator of the damage done to the economy by the lack of a strong skills offer. This Labour Government will tackle the critical skills shortages that have hamstrung our economy, and apprenticeships will power this mission-driven Government and our Plan for Change.

We know that the skills needed for economic growth come from the community up. The Bill will pave the way for Skills England to find and fill skills gaps, ensuring that our skills and apprenticeship offer can harness the talent of young people in communities such as mine and deliver the growth that our country needs. It will allow us to build a skills system that empowers our young people, caters to their diverse talents, and once again restores skills as a national priority. Most important, it will provide the tools for young people in Hertford and Stortford to break down the barriers to opportunity, find the path that is right for them, and reach their full potential. I will proudly vote for it this evening.

17:25

[Dan Aldridge (Weston-super-Mare) (Lab)]

The Bill constitutes a significant step towards streamlining and strengthening our technical education and apprenticeship system, and, as someone who worked in the apprenticeships sector in different roles, I am a big fan. So many of us have seen at first hand how apprenticeships transform lives—how they build dignity in young people’s work, and help them to establish fulfilling careers. Joy at all this unlocked potential has, however, been continually frustrated by the decline in apprenticeships that we have seen over the past decade. This decline must be reversed, and that, surely, is an aim that can unite the House. It is what this Bill is about: delivering the step change in skills that we so desperately need if we are to rebuild our communities and our country.

My constituents must be able to earn, learn and thrive because of what we do in this place, not in spite of it. In towns such as Weston-super-Mare and Worle, technical education and apprenticeships are fundamental to enterprise, prosperity and economic independence for our young people. Sadly, however, towns like mine have never been able to take full advantage of those benefits, because of red tape and because of the hoops that providers and small and medium-sized enterprises have had to jump through. For too long we have seen a fragmented technical education system plagued by that red tape and by inefficiencies.

Given the huge responsibility and expectation on this Government to deliver significantly improved life chances for communities, we must break down barriers and blocks to progress everywhere, and we must be bold in the way in which we restructure the state to make it deliver. Our employers, our training providers and, most important, our apprentices deserve a system that is responsive, transparent, and aligned with the needs of our economy and our society. The young people of Weston-super-Mare are bursting with potential and ambition, but they have often been let down by needless bureaucracy and a lack of the right opportunities and resources—and the right information, advice and guidance—to enable them to develop the skills that are needed by today’s employers. Communities like mine have been left behind by successive skills strategies that have overlooked the nuances in our local economies, especially when it comes to supporting the needs of the SMEs that provide the overwhelming majority of private sector employment in towns such as mine—whether we are talking about Weston-super-Mare association football club, the Ascot Group or our beloved grand pier.

This Bill removes bureaucracy, and will make the system work better. It allows the Secretary of State to act swiftly when necessary, to respond to industry’s needs and to deliver the flexibility that is crucial in a job market where skills requirements are constantly evolving and moving on at an unprecedented pace. If we are serious about providing high-quality technical education, closing the skills gap and developing our workforce, we must structure our institutions to achieve those goals. We must also ensure that towns up and down the country that sit outside cities and, currently, outside combined authority areas—such as Weston-super-Mare—are fully considered, are not left behind in any reforms of skills and apprenticeships, and have a seat at the table when it comes to skills and growth plans. The Bill is a huge step in the right direction, and I urge all my colleagues on both sides of the House to support it.

17:29

[Luke Murphy (Basingstoke) (Lab)]

For too long, our skills system has not delivered due to policies that simply have not worked. Businesses have struggled to recruit the skilled workers they need, young people do not have the opportunities they deserve and investment in training has gone backwards. The previous Government talked a good game and introduced measures such as the apprenticeship levy with big promises, but in reality their approach was slow, bureaucratic and failed to deliver.

It is worth noting, as I said in my interventions on Conservative Members, that I feel their criticism of the Bill today has focused far too much on structures, not outcomes, but since they have done that, I think it is worth reiterating this point. The Standards and Testing Agency sets the statutory assessments for school pupils, and it develops professional skills tests for trainee teachers. It is an Executive agency, just as Skills England will be, and it was formally a non-departmental public body, just as IfATE was. However, the Standards and Testing Agency was set up in October 2011, so I am not sure that criticisms of structures actually hold any merit; rather, they are a distraction from the record of the Conservative party. On its watch, investment in skills fell and apprenticeship starts dropped. Critical sectors are still facing chronic skills shortages, and employers up and down the country have been left navigating a system that just does not work for them. That is why this Bill is so important. It is about fixing what is broken and making sure that our skills system actually works for workers, businesses and the wider economy.

To celebrate National Apprenticeship Week, I visited Basingstoke College of Technology to talk to its current class of carpentry and joinery apprentices, and to speak to college leaders. It was a particular privilege for me because my dad was a carpenter. He left school at 15 with no qualifications, but in the trade that he learned on the job he had skill and pride in his craft. He did not have the opportunity that many young people I met last week in Basingstoke have, with the fantastic support structures around apprentices today and more that we are going to build, as well as all the brilliant ways in which apprenticeships can help turbocharge the careers of so many talented and skilled young people.

One thing that was made very clear to me from my visit to BCOT alone is that it is massively oversubscribed for many of the apprenticeships it offers. That worries me, because it shows that too many young people are not getting access to the resources they need to learn a trade and are being left behind by more than a decade of failure to deliver. So I am pleased that this Government, through this Bill, are working harder and faster—with their very first education Bill to be introduced—to cut red tape and give people greater opportunities to start apprenticeships.

With 1,250 apprentices currently training in Basingstoke, 310 just starting and 110 having just completed their courses, the Labour Government are already making progress, but there is much more to do. I want Basingstoke to be the best place for someone to learn a trade, start a career and build a life for themselves, and I believe this Bill will help to deliver just that, laying the groundwork to establish Skills England and taking a step towards a more joined-up and responsive approach.

Skills England will replace the current fragmented system with one that properly assesses national and regional skills needs, which will be absolutely crucial if we are to meet the challenges of the future. That will ensure we are training people for the jobs that actually exist in the places where they are actually needed. This is not just about cutting red tape; it is about making sure that our approach to apprenticeships and technical education is fit for the modern economy. For years, the system has been tied up in rigid, outdated rules that make it harder to respond to the fast-changing needs of industries such as digital, green energy and advanced manufacturing. The changes in this Bill will allow for a more flexible, forward-thinking approach that actually meets the needs of employers and workers alike. A big part of that is replacing the old apprenticeship levy, which has been too restrictive, with a new growth and skills levy, which will give employers the freedom to invest in a wider range of training opportunities.

As other Members have said, we must put an end to the snobbery around skills and apprenticeships. For too long, highly skilled and essential trades have not been given the recognition they deserve. Too often they have been seen as somehow less valuable than the careers that require a university degree, despite being just as vital, just as skilled and just as valuable to our economy and society. I am proud that this Government are changing that narrative. We need these skills to drive growth, build the homes and infrastructure that we need and deliver energy security. We have the opportunity here to fix the mistakes of the past and to build something better. I urge colleagues to support the Bill, because a strong skills system is not just good for business and the economy, but good for everyone.

17:35

[Mr Toby Perkins (Chesterfield) (Lab)]

As co-chair of the all-party parliamentary group on apprenticeships, alongside my hon. Friend the Member for Peterborough (Andrew Pakes), I welcome the Government’s focus on this crucial aspect of skills policy. They have inherited a wildly diverse and dysfunctional skills landscape. I would not go so far as to describe what we have as a skills system, which would seem to suggest something far more considered and structured than what currently exists. This Bill is the Government’s first very small legislative step towards addressing the skills crisis that is one of our nation’s biggest barriers to growth and productivity.

It is almost impossible to have a meeting with an employer—private or public sector—without the issue of the UK’s skills deficit arising. Apprenticeships are a crucial but criminally underutilised dimension of providing Britain’s learners with an opportunity to earn while they learn, and provide our employers with skilled and qualified workers who contribute in the workplace as they develop the skills they will need. Indeed, the Government’s ambitious aspirations for growth will remain purely aspirations if the current failure in our skills approach is not rectified.

The right hon. Member for Sevenoaks (Laura Trott) suggested that the previous Conservative Government’s record on apprenticeships was world class, but I beg to differ. In discussing apprenticeships, it is worth first identifying what is wrong with the current system before considering the extent to which the Bill moves us towards resolution of those issues.

First, it is estimated that around £480 million will be left unspent in the major employers’ apprenticeship levy pot this year. FE News reported in February 2024 that SME apprenticeship starts had fallen by 49% since the introduction of the apprenticeship levy, with the cost, rigidity and bureaucracy of the current system all cited as reasons why SMEs do not take on apprentices. Level 2 and 3 apprenticeships, in particular, have suffered, with a 53% reduction since the introduction of the levy, while a growing portion of the levy pot is being spent on degree-level courses.

Degree-level apprenticeships should be a huge social mobility tool, with learners from poorer backgrounds who might be dissuaded from attending university relishing the opportunity to secure a degree while working and without accruing debt. However, recent research has shown, shockingly, that degree apprenticeships are being swept up by the wealthier students, with free school meals pupils less likely to get a degree apprenticeship than to get a place at Oxbridge.

Finally, the completion rate of apprenticeships is worryingly low, at just 54.3% of all students, compared with 97% of A-level students passing across all subjects. This is due to many causes; the Government have set about addressing one by removing the need to pass functional maths and English in order to complete an apprenticeship for under-19s. However, there also needs to be a much greater link between the completion of the apprenticeship and the fitness-to-practise requirements. Many learners do not complete the apprenticeship, but not because they have failed—they may well have secured the skills they needed to start work, and do not see the apprenticeship as being relevant once the job has been secured. There is, therefore, a great deal for the noble Baroness Smith, in the other place, to sink her teeth into.

This Bill is the Skills England Bill that dare not speak its name. By abolishing IfATE, it lays the groundwork for the creation of Skills England. There are important questions for the Government to answer, and I hope that when my hon. Friend the Minister responds to the debate, she will be able to enlighten us on a number of them. First, is she concerned that Skills England will have the necessary weight and independence to bring about the scale of change that its own report acknowledged was necessary? What will the extended scope of Skills England be, beyond the identification of standards and the potential alternative use of the Government’s new growth and skills levy?

If the Minister is not clear about what shape Skills England will take post IfATE, is she concerned about abolishing IfATE without being clear on what will replace it and where the responsibility for those functions will fall? Can she say any more about how the voice of employers will be heard when the powers are centralised with the Secretary of State? There may be huge enthusiasm for the Secretary of State taking a more streamlined approach, on occasions, to the process of creating new standards, as IfATE is seen as too cumbersome. However, does she agree that that must be the exception rather than the rule? How will she ensure that employers’ voices are still heard? Can she also confirm that the powers to approve standards will indeed pass to Skills England once that has been created, and can she say any more about the role of Skills England with regard to the growth and skills levy?

I very much welcome Baroness Smith’s announcement about removing the need for passing maths and English for students who are over 19, but has the Minister done any assessment of the merits of that for students under the age of 19? I am interested in understanding the arguments in favour of that change for over 19s that do not apply to students who are under 19.

I hugely welcome the Government’s commitment to this area of policy and the positive initial steps. I suspect that it will not be news to my hon. Friend that I think that far greater systemic change is needed if we are to deliver the more transformational change that our employers, our learners and, indeed, our nation desperately need.

17:40

[Lauren Edwards (Rochester and Strood) (Lab)]

I do not support the amendment but will speak in favour of the Bill.

As many have highlighted, there is a gap between the skills needed by employers and the skills held by the UK workforce. Skills shortage vacancies have been on the rise year after year, and the latest data shows that a third of all vacancies are due to skills shortages. It is holding our country back and, therefore, the system needs to change. The immediate skills gaps need to be addressed urgently, but just as pressing is the need to have a single body that considers the skills that our businesses will need 10, 20 or 30 years from now, with 1.4 million new jobs predicted by 2035 alone. Many of those new jobs will need technical green skills, digital skills and understanding of artificial intelligence.

If our Government are to achieve the changes in this country that so many people voted for—more homes, green energy and economic growth that puts money back into people’s pockets—skills are the key ingredient. The importance of apprenticeships and technical qualifications to that mission cannot be underestimated. Indeed, I was immensely proud when the Prime Minister and the Education Secretary visited MidKent College in my constituency before the election to set out their ambition to put vocational education on the same footing as academic university education.

If Skills England is to achieve its aims and help us to meet the skills challenges our country faces, it must cover all areas. I therefore welcome the Bill, which folds IfATE into Skills England to enable that integrated approach to support our labour market and economy.

As others have mentioned, the Bill will make Skills England an Executive agency of the Department for Education. I am pleased that Ministers amended the Bill in the other place to require the Secretary of State to lay a report before Parliament detailing the exercise of functions conferred on her by the Bill. I understand that will also make clear the functions that Skills England will take on and the expected effects of those functions. I likewise welcome the commitment to publishing details of the framework that will be used to hold Skills England to account for its delivery and its relationship with employers. The clarity those documents will provide is most welcome.

I will also take this opportunity briefly to welcome the reforms announced by the Government during National Apprenticeship Week. The apprenticeship levy under the former Government, well meaning though it was, was too cumbersome and restrictive for too many employers and learners. As a result, apprenticeship starts fell off a cliff, and the latest data on apprenticeship completion shows a rate of just 55% in England. I am therefore pleased that the Government have listened to employers and training providers and committed to making the new growth and skills levy, which will replace the apprenticeship levy, simpler, more flexible and employer-led. I note that Skills England will be tasked with carrying out analysis of the broader types of training that will be eligible under the new levy and I look forward to seeing the outcome of that work, which will be hugely beneficial to employers and apprentices.

A common issue with the current apprenticeship schemes in this country, as others have mentioned, is that it does not work for small and medium-sized enterprises, which do not have large human resources departments to help navigate the often complex skills landscape. Nowhere is this more apparent than in my local authority area of Medway where 90% of all businesses are SMEs. Can the Minister set out how the Government will ensure that the voices of SMEs will be heard, so that we get an apprenticeship framework that works for all types of businesses? That is particularly important if we are to drive growth across all parts of the country. I know, for instance, that there are some larger businesses looking at how they can provide practical apprenticeship support to SMEs in their supply chain, so it would be good to know whether the Government are considering how they can best incentivise approaches such as this, which will help hugely by “de-risking” apprenticeships for SMEs.

Likewise, I know that there are some amazing smaller training providers. I have a fantastic women-led one in my constituency called Umbrella Training. It is equally important that these providers’ experiences and needs are reflected in the new apprenticeship system.

There are always risks associated with change; that is unavoidable. There is obviously some concern that the transfer of IfATE to Skills England may lead to a level of disruption, so it would be helpful if the Minister provided details of the main risks identified by her Department for the transition and how they will be managed and mitigated. Doing so would help to provide assurance to those currently undertaking apprenticeships and other technical qualifications, as well as to employers. It will be particularly important to ensure that the knowledge and expertise of staff at IfATE—no doubt built up over many years—is not lost during this process.

It will also be helpful for Skills England to set out a number of other issues in due course, such as what changes may be proposed to the local skills improvement plan framework, and assurance that local areas will be able to prioritise sectors or industries that are key to driving their local economy that may not feature in the Government’s industrial strategy, as mentioned by my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell) earlier in the debate. Anything further that the Minister can say on these points at this stage would be welcome.

Finally, clause 6 removes the requirement to review technical educational qualifications at regular intervals. Instead, the Secretary of State will have the flexibility to focus on reviews based on need. It would be helpful if, in her response, the Minister outlined what steps will be taken to ensure that the quality and relevance of qualifications is maintained under the new framework.

[Madam Deputy Speaker (Judith Cummins)]

Before I call the next speaker, may I gently remind Members that their speeches should be no longer than five minutes?

17:47

[Maya Ellis (Ribble Valley) (Lab)]

Like many of my colleagues, I found that this year’s National Apprenticeship Week really brought to life the amazing work being done by businesses, organisations and students across my constituency. Listening to many of the comments from across the House about how we need to improve the culture and perception around technical education, I am minded to reflect on the experience that I had when I was in year 9 and getting quite high results in my electronics exams. I had an amazing teacher, Miss Robinson, who asked me one day whether I would consider doing a BTEC in engineering. I did not end up following that technical route, but I do wonder what our productivity would be today if, back then, our culture had promoted it more prominently, particularly for people who were very academic.

I am really excited at the prospect of the Bill laying the groundwork for the new body, Skills England, to realise our ambitious missions for opportunity and growth. One of the best commitments in this Government’s manifesto was to link immigration and skills policy in an effort to tackle the UK’s reliance on international recruitment. Indeed, during the general election campaign, I was on a panel with fellow candidates in Lancashire and explained our commitment, and a fellow candidate standing for Reform remarked that he actually really liked that idea. I will be interested to see whether his colleagues agree today.

Skills England will work closely with the Migration Advisory Committee and Industrial Strategy Council to develop an evidence-based approach to the labour market, with the committee set to monitor sectors where skill shortages are leading to increases in overseas recruitment. Importantly, this will mean that there will be a focus on sectors reliant on overseas workers to ensure that they are addressing their failure to invest in skills in the UK. To support British workers as best we can, it is promising to hear that international recruitment will not be the standard choice for employers filling skill shortages. Although migration can play a strategic role in supporting our economy, it must not be utilised as a means to address skills or training shortages in the UK over supporting British workers here. In general, we are far too familiar with pressing skills gaps negatively affecting our economy. Some 20% of our UK workforce may be significantly under-skilled for their jobs by 2030, and 1.5 million jobs in England are at risk of at least some of their tasks being automated in future.

There are businesses and organisations leading the charge in tackling this. In my previous life away from this place, I was privileged to work alongside the Lancashire skills and employment hub and the Lancashire digital skills partnership, which have long been pioneers for developing our skills landscape in this country. I would like to put on record my thanks to Michele Lawty-Jones and Kerry Harrison, who lead those services, piloting programmes such as the skills bootcamps, which they made such a success of in Lancashire that the previous Government rolled them out nationally.

Their hard work also secured the Lancashire and Cumbria institute of technology, which I was delighted to visit last week at the Preston college base in my constituency. Its principal, Simon Nixon, and many students spoke to me about the technical training that they receive in health and social care, construction, counselling and engineering. Vitally, Preston college collaborates closely with industry experts and businesses to ensure that its curriculum is up to date and reflects the needs of the economy. It is working with around 950 employers who help design the curriculum, support assessments and offer mentoring and industry placements for its IoT students. A great example of that is its work with Leyland Trucks, which reported a need for electric vehicle training for its apprentices. The college embedded a new module into its institute of technology course.

A key need that Preston college meets is providing increased adult education opportunities. The upcoming devolution deal in Lancashire will undoubtedly allow organisations to have an increased say in adult education budgets, to boost local productivity and foster the right opportunities for the north-west. However, the college is concerned about the reported 2% to 3% reduction in adult skills budgets. For colleges that have little adult work or that have struggled to deliver against contract, that might be less of a problem, but Preston college gets around 20% of its income from adult provision and has been able to over-deliver for the past few years. Any reduction applied across the board would hit Preston college’s delivery, particularly in key areas such as construction and English for speakers of other languages, and is likely to add to cost pressures already felt.

Undoubtedly, we are under severe financial pressure at the moment, but we need to be careful that short-term savings do not impact the long-term skills development that we desperately need to lead us to a better financial outlook. I welcome the Minister’s comments on that. What really blew me away at Preston college was the feel of the place. It felt inspiring, modern and a place to really grow. I heard from students who had had negative experiences elsewhere but felt truly at home there. That is what Government investment can do for the wellbeing of areas in need of growth. That is the opportunity we have with this Bill.

BAE Systems is another business operating in my constituency that offers fantastic training and skills opportunities, particularly through apprenticeships. I was moved on a recent visit, on which I was delighted to be joined by the Minister for Skills, Baroness Smith, by a young person who had tried a few times to get a role at BAE Systems. Because of the multitude of inclusive routes that BAE provides young people to end up on one of its apprenticeships, he eventually found a route that allowed his strengths and potential to shine, enabling him to secure a role.

I know from having worked in economic development in Lancashire that many local SMEs have benefited from BAE Systems over-training on its apprenticeship programmes, so that there is a supply of apprentices who can flow into the surrounding SME chain. As many Members have noted, a big challenge is how we encourage SMEs to support apprenticeships when they may need only one or two apprentices. The route that BAE went down came from targeted Government funding. I would welcome the Government’s considering something similar. BAE had the training infrastructure to provide the support much more efficiently than most SMEs would be able to do themselves. We should maximise our productivity in how we train people by making the most of the successful structures that we already have.

I am delighted that almost half of people starting apprenticeships in Ribble Valley in the past year were aged over 25, showing that people in my constituency are ambitious and committed to lifelong learning. I fully support the Bill and I cannot wait to see Skills England established, to support those looking to improve their skills by bringing about a more data-driven and joined-up skills system for all of us.

17:54

[Steve Yemm (Mansfield) (Lab)]

It is often said that the UK is increasingly a knowledge economy; a place where our growth and jobs come both from trading ideas and information as well as physical goods. This Government’s plan for growth clearly recognises that and plays to our strengths, which is why we are now the second most attractive country to invest in globally, according to a recent PWC report. However, it is vital that the benefits are felt equally across our country.

Areas with a proud industrial heritage like my constituency of Mansfield did not get the investment and training programmes they needed under previous Governments, and our young people have suffered the consequences of that. Many of them face an unenviable choice between staying trapped in unstable and low-quality employment or leaving their home towns to seek opportunity elsewhere in the country. My election in July was a resounding vote for change in Mansfield, and my first mission for the constituency was to fight for a growing economy with good-quality jobs for everyone. For that reason, I will be pleased to vote for the Bill, which is a major step of progress in the Government’s reform of the skills and apprenticeships system.

Apprenticeships are a critical component for high-quality jobs in Mansfield. On my visits to businesses around my constituency, I have been fortunate enough to see the great work already being done by some of our employers, working in partnership with West Notts college and Nottingham Trent University. That includes: local aerospace and nuclear electronics company Glenair, which recently took on 60 apprentices; Power Saving Solutions in Warsop; and Capita in Mansfield, which is doing particularly good work to support people with disabilities to access and sustain employment through apprenticeships. They are providing opportunities not just for school leavers but for those who are retraining and getting back into the world of work. We must not underestimate the importance of that for those individuals, the local economy or for productivity and growth nationally. We need to be doing more to encourage that type of opportunity in my constituency and across the country.

I therefore welcome the changes that we will vote on today. In particular, the transfer of powers from the old Institute for Apprenticeships and Technical Education to the new Skills England body and the reform of the apprenticeship levy are two measures that will help bring together under one roof the patchwork of schemes and organisations that currently exists and result in a more flexible system that will give our local training pioneers the support they need.

Britain needs to begin the process of reskilling workers. I draw attention to the work that Nottingham Trent is doing with West Notts to encourage adult learners, facilitating direct entry into the renewables workforce, which is another great example. I expect the impacts to be transformative for Mansfield in the long term. For that reason, I end by inviting the Minister to visit my constituency, where she will be able to see for herself the start made in upskilling our young people and adults as well as how far these changes will go in delivering secure, fulfilling, well-paid employment.

Mansfield is a place with significant latent potential. I believe that a keen-eyed collaboration between local businesses, further and higher education and the Government will support our formerly neglected area to realise the potential that we have.

17:58

[Kirith Entwistle (Bolton North East) (Lab)]

Too many young people are being let down by a skills and training system that does not work for them. For too long, Britain has been a country where technical education has been treated as second class, skills shortages stifled success and talent went untapped. Let us be clear: the Conservatives’ legacy has failed our young people and they cannot keep using the pandemic as an excuse. Between October 2023 and September 2024, 41% of people aged 16 to 24 were economically inactive in the north-west; nationally, that number was 11.4%. I would be really interested to hear what Conservative Members have to say to young people in the north-west.

In the last two years, skills shortages have left more than a third of UK vacancies unfilled while the number of 16 to 24-year-olds looking for work has doubled. That is over 420,000 young people wanting to work and to contribute to our economy, but, without the right training, they cannot get those jobs that need filling—jobs that they could thrive in if we had the right skills system.

Our young people are not lazy. Rather, it is the system the Conservatives left behind that has failed them. Visiting businesses in Bolton, I know that employers are desperate for skilled workers and that they recognise skills training and apprenticeships as a way forward. The young apprentices I have met in Bolton are thriving. They have security, skills and a clear path ahead, and that confidence is transforming lives and livelihoods. That is why am proud that, through this Bill, this Labour Government are establishing Skills England. Skills are not second class; they are the backbone of Britain. Skills England will break barriers that have left entire regions such as mine behind.

In Bolton, have already seen what works. Bolton Lads and Girls Club, part of the outstanding youth charity OnSide, has achieved remarkable success with its On Track initiative. This programme provides one-to-one support for young people who are not in education, employment or training, offering practical help with CV building, interview preparation and visits to businesses. But more than that, it broadens their horizons, showing them the many promising alternatives to the traditional university route and pathways that may better suit their skills and ambitions.

I recently visited Bolton college during National Apprenticeship Week. Its apprenticeship programme is another shining example of how investment in skills transforms lives. From health and early years education to engineering, digital skills and low-carbon construction, Bolton college is equipping young people with the expertise that businesses urgently need. During my visit, it was clear that the apprenticeship levy’s rigid restrictions —allowing funds to cover training but not wages—were directly preventing businesses from hiring more apprentices, so I sincerely hope that Skills England will review the levy so that more young people can earn while they learn and employers can fill those critical skills gaps.

The successes of OnSide and Bolton college provide proof of what happens when we invest in skills and opportunities. Now we must take those lessons and scale them up nationally. This Bill and Skills England are not just about educational reform; they are an economic necessity and critical for growth, because Britain cannot build, grow or lead without a workforce that is skilled for the future.

But let us also be clear about what Skills England is not. It is not another quango, it is not more red tape, and it is not just another Government agency. Skills England is a promise to young people that their future does not have to follow a single path, a promise to businesses that they will have the workforce that they need to thrive, and a promise to this country that Britain’s best days are ahead, not behind us. We need more builders, engineers, coders, carers and welders—the people who power this country—and I am proud that this Labour Government are ending the snobbery around skills and finally putting apprenticeships on an equal footing with academia. I wholeheartedly support this Bill and the opportunities that Skills England will create for my constituents, not least young people.

18:02

[Amanda Martin (Portsmouth North) (Lab)]

I have been proudly championing the very neglected skills and trades sector since arriving in this place because, unfortunately, one of the most toxic legacies of the previous Government is a crisis in education and training, with overwhelming barriers to opportunity for far too many young people and a real downplaying of practical vocational skills in the eyes not only of students but often of their parents and the wider community. This is in stark contrast to what we see across Europe, Australia and the USA.

Apprenticeships offer young people an alternative pathway to success and one that is not only vital for our communities but practical, hands-on and deeply connected to the industries that drive our economy. We must start by ensuring that we value all pathways and people if we are to move towards a productive, highly skilled population and achieve our growth targets. Vocational training is hugely important. However, in 2022, we had nearly 340,000 apprenticeship starts, compared with 520,000 11 years before that. Young people in my city of Portsmouth are not always able to access the well-paid jobs, despite there being many opportunities on our doorstep in the defence, maritime, space, science and trade sectors, to name a few.

We must improve and promote vocational pathways by increasing the number of apprenticeships available, improving apprenticeship completion rates, increasing financial support and increasing the flexibility of courses. This Bill establishing Skills England is the first step to achieving some of the much-need elevation of our skills sector.

Only a third of apprenticeships are completed. That is a shockingly low statistic, and it could be improved by increasing financial support. It is therefore welcome to see the 18% increase in apprenticeship rate pay from April to help make apprenticeships more attractive. It would be good to see more targeted support made available to those who have dependants and other financial responsibilities.

I welcome the Government’s commitment to look again at the levy and the length of apprenticeships. Adopting a modular structure and increasing flexibility could significantly boost competition rates by providing a more adaptable learning experience. Increasing the flexibility of apprenticeships also accommodates diverse learning needs and life circumstances, making it easier for apprentices to balance work and training alongside personal and financial commitments. I look forward to Skills England examining those issues in a new chapter for innovative thinking on apprenticeships.

In my constituency of Portsmouth North, the City of Portsmouth college is a centre of excellence for apprenticeship training, especially in the areas of gas engineering and refrigeration, air conditioning and heat pump engineering. The college plays a vital role in equipping young people with the skills they need and we need as a city and a country. The college’s gas assessment centre is now the leading provider of gas assessment training in Portsmouth, Hampshire and West Sussex, ensuring that our region remains at the forefront of those essential industries. From skilled trades, such as bricklaying, electrical engineering, carpentry and plastering, to professional careers in business administration, accounting and early years education, the range of courses reflects the diverse needs of our local workforce.

Crucially, the programmes are supported by strong partnerships with major employers, including BAE, Airbus, Queen Alexandra hospital, the NHS and of course the Royal Navy. The partnerships not only ensure that apprentices receive a direct link to potential careers, but mean that students can feel the value of training and future opportunities. The success of that approach is evident, and I am particularly proud to mention James Rowland, an apprentice in refrigeration, air conditioning and heat pump engineering who won silver in the WorldSkills UK RACHP competition in December —an incredible achievement that showcases the high calibre of training and people in my city.

We must recognise the importance of sustainability in our skills development. Earlier this year, the City of Portsmouth college facilitated access to green skills funding, enabling local plumbing and heating businesses, particularly small and medium-sized enterprises, to train apprentices in sustainability. That is precisely the kind of forward-thinking initiative that ensures our workforce remain prepared for the challenges of the future, and I am proud that my city is embracing those opportunities and looking forward to extending them with Skills England.

18:07

[Peter Swallow (Bracknell) (Lab)]

A Government who are ambitious about growth need to be serious about skills, because without the workforce trained to build and insulate the homes we need, to install the next generation of electric vehicle charging infrastructure, to deliver excellent health and social care and to deliver high-quality early years education, none of the Government’s missions are achievable. Better skills mean good, often well-paid jobs. Apprenticeships are a driver of social mobility, and I am determined that my constituents feel the benefit of those opportunities. Skills England will have much to do to pull together a fractured skills landscape and deliver real change, but the Bill will enable it to make a solid start.

My constituency is home to the excellent further education college Bracknell and Wokingham college, which already does so much to offer young people the chance to deliver the skills of the future in everything from social care to sustainable technologies, from pharmaceuticals to construction. The college trains over 100 electrical installation apprentices, providing them with hands-on training in state-of-the-art electrical installation workshops, which were recently renovated with more than £200,000 of investment. The facility ensures that learners gain practical experience with the latest industry-standard equipment, preparing them for high-demand roles in electrical engineering, construction and sustainable technologies.

Last week, I visited the Bracknell Forest skills hub, led by Nikki Burns, a small business owner with years of experience. The hub is proactively identifying with employers where the skills gaps are, working with potential and existing employees to address those gaps, and teaming up with education providers, including my local college, to design bespoke courses to plug the gap, all backed with support from local and national Government. Since launching in September, the skills hub has already engaged with over 40 businesses, offered tailored support for over 50 jobseekers, trained 300 employees and built two bespoke courses. That is a system working as it should, but we need more collaboration, and Skills England will have a huge role to play in identifying skills gaps at both national and local levels, and in ensuring that businesses and Government are talking to each other.

Businesses understand the value of good skills and apprenticeships for their workforce. Waitrose, whose head office is in my constituency, is just one example. It currently has 1,200 partners on live apprenticeships across 30 schemes. When I visited Waitrose last year to meet some of its apprentices, I saw the true range of opportunities available, from people training up to look after Waitrose’s delivery fleet and maintain its bodywork to apprentices studying for a T-level in finance, in partnership with Bracknell and Wokingham college. Smaller-scale schemes also offer routes into employment. Waitrose’s “Building Happier Futures” programme is designed to support care-experienced young people—including those who have been in kinship care—into work.

When I have spoken to Waitrose and other businesses in my constituency, they have told me that among the barriers they face to offering more apprenticeships are the inflexibility of the apprenticeship levy and the overly burdensome requirements needed to run and recruit to an apprenticeship. That is why the reforms to apprenticeships that the Government announced two weeks ago are so very welcome. They will provide more flexibility for employers and those who want to take up these opportunities, shorten the length of some apprenticeships, and scrap the need for adult apprentices to pass English and maths GCSE. Those are common-sense changes backed by business. To be successful, Skills England will also need to get a grip on the lengthy time that it takes to update frameworks, to ensure that apprenticeships always remain at the cutting edge.

It is also vital that opportunities be genuinely open to all, including those with additional needs. Data from the Office for National Statistics shows that only 29% of autistic people are in paid employment—that is not good enough. More targeted support is needed at local and national level to ensure that more autistic people can better access apprenticeships and other skills. Bracknell Forest council is currently looking at how to address that autism employment gap, particularly through more support into apprenticeships and other forms of work experience.

Skills England has a huge job ahead of it. Our country has too often relied on importing skills rather than nurturing our own talent, which is not progressive, and too many young people have missed out on valuable opportunities. Skills gaps are preventing us from building, growing and thriving. Skills England will be at the vanguard of the Government’s work to fix all that—no small task, but one for which the reward is great.

18:12

[Catherine Atkinson (Derby North) (Lab)]

I am proud to be a Derby MP and to represent a city with incredible engineering, manufacturing and technological expertise and skills. We make things in Derby. Yes, we have industrial giants such as Rolls-Royce, Alstom and Toyota, but we also have the brilliant small and medium-sized companies in their supply chains and more broadly, from a wide range of industries including rail, defence, nuclear energy, food production, aviation and digital technology.

What attracts so many businesses to Derby is our skilled workforce, but I know that even our city feels this country’s skills shortages. Under the previous Government, a third of UK job vacancies were a result of skills shortages, and the uptake of level 4 and 5 technical training in England fell to historically low levels. I warmly welcome the Bill, which lays the groundwork for the establishment of Skills England to assess and help to address our skills shortages.

Larger companies in Derby have been investing in skills and apprenticeships. The Rolls-Royce nuclear skills academy, for example, offers 200 apprenticeships a year, working with the University of Derby and Derby college. The Toyota academy provides skills not just for its own apprentices but for partner companies too. Many of our small and medium-sized employers are investing in their future by investing in skills, such as tech company Barron McCann, which I recently visited, and engineering firm Tidyco, which supports apprentices but also goes into local schools to teach young people the metalwork skills they need to make metal toolboxes. However, I have met many businesses that say that finding skilled workers is one of the greatest challenges they face and that under the last Government, they found apprenticeships too difficult and too inflexible to access.

We are fortunate in Derby to have Derby College, which is one of the largest FE colleges in the UK, and University Technical College Derby, which both work closely with employers to ensure they are providing the skills needed. One of the students told me that what he loved about learning at the UTC was that he felt he was learning something real. We have more than 3,000 apprentices in Derby, but I know that we need many, many more, and it is not just people starting out who need careers; we also need to reskill our workforce and allow those in mid-career to move into new roles and new industries.

I want to raise skills shortages in a sector close to my heart. Last week, my hon. Friend the Member for Derby South (Baggy Shanker) and I held a meeting organised for us by the Rail Forum with the rail sector about skills. I often meet people in rail who talk about the sector as Britain’s best kept secret, with people sometimes joining by accident but staying because of the range of opportunities it offers, from engineering to customer services, project management to catering, digital roles, technicians and many more.

The Rail Delivery Group identifies that rail adds some £98 billion annually to local economies and £26 billion in environmental and social benefits, but the National Skills Academy for Rail reports that a third of the rail workforce are 50 or over and estimates that some 75,000 people will leave the industry by 2030 through retirement or other forms of attrition. This year is the 200th anniversary of the modern railway, which we as a country pioneered, and its future is crucial for growth and decarbonisation. I invite the Minister to encourage Skills England to work with the National Skills Academy for Rail and Great British Railways, which will have its headquarters in Derby, to address the skills shortages we face in rail.

I am really excited that under this Government, we are going to have a proper industrial strategy, and it is essential that we have the right skills and the right infrastructure to get the people and the goods where they need to be. I echo the call from my hon. Friend the Member for Peterborough (Andrew Pakes) for Ministers to set out how Skills England will work across Departments to support our industrial strategy. I urge all Members across the House to support this Bill. I look forward to working with Skills England to ensure that we have the skills we need, that we have opportunities for all and that we keep our economy on track.

18:17

[Mrs Sureena Brackenridge (Wolverhampton North East) (Lab)]

I start with a fundamental point, which is that education does not always have to happen in a classroom. That is essentially what the Bill is about. Under the last Government, we saw a failure to tackle deep-rooted skills mismatches, a stubbornly high proportion of working-age people lacking essential skills and a severe shortage of higher technical training. As a result, our workforce struggled to meet the demands of a technology-driven economy, while employers faced persistent skills shortages.

This Bill is different. It abolishes the outdated Institute for Apprenticeships and Technical Education and transfers its functions to Skills England. This is a monumental shift that creates a unified, agile and responsive skills system. Can the Minister assure us that the Bill will underpin what good government is about—listening to the needs of businesses, workers and learners; that it will allow more people, young and old, to earn while they learn and develop skills that will serve them well for life; and that by improving access to these opportunities up and down the country, we will drive growth, reduce youth unemployment and improve life chances for so many people?

[Antonia Bance (Tipton and Wednesbury) (Lab)]

My hon. Friend is eloquent in setting out the skills challenges of the Black Country. My constituency neighbours hers, and locally 40% of jobs need level 4 skills, but only 16% of people have those skills. That is the challenge we face locally. Does she agree that Skills England should be set up and based in an area of the country that desperately needs a skills upgrade, such as the Black Country?

[Mrs Brackenridge]

I absolutely welcome that intervention and support it wholeheartedly. Communities such as ours have felt and seen the decline, and the Government are laser focused on reversing that to unlock talent and opportunities, and to give our residents a better chance to get their futures back.

In the past few weeks I have been honoured to meet many impressive apprentices, from those at Wolverhampton Homes, who are ensuring that residents’ council housing is safe and well maintained, to Evie and Jake at Collins Aerospace, who are working on the future of flight and defence, as well as apprentices from Jaguar Land Rover, Halfords, BMW, Enterprise Mobility and Caterpillar. We have seen the consequences of a fragmented, outdated skills system, but with the Bill we now have a bold new direction that will empower workers, support businesses and drive economic growth across our country. The Bill will support apprenticeships now and into the future, and I urge the House to support it.

18:21

[Adam Thompson (Erewash) (Lab)]

I am pleased to speak in support of the Bill, unamended, which I believe is crucial to delivering growth and ensuring that we have a highly trained workforce that is fit for the future. As some in the Chamber will know, my job before coming to this place was teaching degree-level apprenticeships in electro-mechanical engineering. I saw at first hand the transformative power of apprenticeships in delivering high quality education while providing real world experience.

Like all apprenticeships, degree-level apprenticeships are a tripartite partnership between apprentice, university and employer—a model that has proved highly effective. Our employers frequently reported back to us that apprentices were better prepared for their professional roles than their counterparts with traditional degrees, and degree-level apprenticeship programmes have widened participation, attracting more students from deprived backgrounds, and more students with learning differences who may have struggled within the traditional university system.

As a Member of Parliament, I weave my background in education, advanced manufacturing, and apprenticeships into everything I do in this role. I recently visited WEBS Furniture Training, which trains apprentices in bespoke furniture manufacturing—a proper, old-school, artisan skill that they can carry with them and make a career from all their lives. Long Eaton and Ilkeston, the principal towns in my constituency, have a long and proud history of furniture manufacturing and lace making respectively. Both towns are what they are today firmly as products of the industrial revolution, and although the economy has changed since the Victorian era, bespoke furniture manufacturing, done by highly skilled, irreplaceable artisans, survives.

IKEA, robots, and giant factories in China cannot replicate the product of the honed, learned artistry that remains the backbone of our British manufacturing, and to survive now in this changing world, those are the kinds of skills that Britain must foster. Such skills are also an incredible means of spurring economic growth and resilience outside London and the greater south-east, and indeed outside the great cities of the north and midlands. Ilkeston and Long Eaton are post-industrial towns in the east midlands, and if we get this right, we can protect and enhance their world-beating lace making and furniture manufacturing industries long into the future.

If we are to build the 1.5 million homes that the Government have promised in the next five years, and hopefully many more long after that, and if we are to build the new towns, railway lines, reservoirs, prisons—all the things that this country has failed to invest in for so long—we will need the electricians, carpenters, joiners, builders, welders and plumbers that apprenticeship providers are training across our country.

I would like to present a case study about my good friend and colleague, Councillor Harry Atkinson. Harry was one of the many new young councillors elected in Erewash when Labour took control of the borough council in 2023. Next year, he will be Erewash’s youngest ever mayor, aged 25. Harry is also a highly skilled engineer. Leaving school at a time when about half of his cohort were going to university, Harry instead got an apprenticeship at Ratcliffe-on-Soar power station, which looms across the skyline of my constituency. Until last autumn, it was the last operational coal-fired power station in Britain. Harry has worked at Ratcliffe for nearly a decade. He has become so skilled that he has been promoted to managerial level and he is now a key trouble-shooter when things go wrong. While Ratcliffe is now in its decommissioning phase, Harry can be assured in his future because there is ample demand for the skills he learned in his apprenticeship, both locally and across the country.

Harry’s story represents the power of an apprenticeship —the conversion of hard work into real skills, an assured career and good pay. It is those kinds of jobs that we need to create for our young people. It is on us—this Government—to build a future where this kind of apprenticeship success story is the norm, not the exception, and where an apprenticeship holds every bit as much value as a degree, is every bit as desirable for children and parents, and is every bit as much a cornerstone of our growing economy.

11:30

[Alison Hume (Scarborough and Whitby) (Lab)]

I warmly welcome the Bill. It clearly demonstrates the Government’s ambitious commitment to training and apprenticeships. I will concentrate on the role that Skills England will play in aligning apprenticeship opportunities with the needs of local economies.

Scarborough and Whitby are beautiful places to live and to visit, but the levels of low-paid employment are not so appealing. According to the latest ONS figures, 26% of all jobs in my constituency were paid below the real living wage. On closer examination, the figures are even more alarming. For example, some 52% of part-time jobs done by women in my constituency were paid below the real living wage, while that figure for England was 32% and for Yorkshire and Humber it was 35%. The disparity between the figures for Scarborough and Whitby and the surrounding region should give us pause when we refer to local economies, because coastal communities can differ markedly from their hinterland.

Skills England’s work in assessing local needs and opportunities must anticipate what those needs and opportunities may be in future, as well as now. Well-paid jobs and careers are the goal for young people in my constituency. It is a crucial time for the green transition that we need to reach net zero and to create the urgently needed skilled jobs in the renewables sector. Scarborough is one of closest harbours to the offshore wind farm sites in the North sea, especially Hornsea Four, making it a prime location for the transportation of equipment and personnel, as well as for service vessels.

The Government rightly see the potential of the creative industries to create growth, but we know that young people from disadvantaged backgrounds or those who do not live in metropolitan areas are often denied such opportunities. In the past year, the Stephen Joseph Theatre in Scarborough has created two full-time trainee posts, with partners at Coventry University. It will deliver a degree course in acting and has a programme for young people pursuing a career in the performing arts. I want us to build on that to provide far more opportunities for talented young people in Scarborough and Whitby to train locally in the creative industries, especially to bridge the skills gap in practical trades, such as lighting, sound and camera operation.

As in so many areas, construction trainees are urgently needed now, and will be in the future. I am excited by the Government’s support for a new development planned south of Scarborough, in Cayton, that will start as soon as possible and provide 2,500 new homes. The people building those homes and that infrastructure should be trained locally as far as possible.

I am pleased to tell the House that the construction skills village in Scarborough is already doing an incredible job of providing training for construction apprentices. It currently has 140 apprentices on its books, providing training in plastering, carpentry, bricklaying and electrical work. It has also just run its first solar panel installation course. Some 60% of its learners come from an area that is among the most deprived in the country, and a high number have additional educational needs, yet the record of its apprentices exceeds national outcomes. I ask the Minister to confirm that existing centres of excellence can be funded to provide more of what they already do so well.

In conclusion, I look forward to a future in which organisations such as the construction skills village are part of the Government’s plan to boost apprenticeships and build a better kind of local economy.

18:30

[Amanda Hack (North West Leicestershire) (Lab)]

I welcome the introduction of this Bill as a clear indication that we are giving apprenticeships the support and recognition they deserve. I started my professional career at a training and enterprise council—a TEC—and, once upon a time, I used to sign off training contracts for apprenticeships. It was always a pleasure to speak to young people at the start of their future, so I know at first hand how needed the Bill is for the FE sector, employers and young people, and it is incredibly exciting to have this back on the agenda.

For the last 14 years, there has simply been no strategic direction. The partnership between Jobcentre Plus, FE colleges, employers and the workforce has been slowly eroded, and it is clear that we need a reset. The one in eight young people currently not in training, education or employment need that reset, and apprenticeships are a part of that agenda. This Bill paves the way for the establishment of Skills England, giving it the tools to perform its new role and delivering on our commitment to assess and address the existing skills gap and identify where training can be utilised for new growth.

Since the apprenticeship levy was first introduced by the Conservatives in 2017, we have had a decline in the growth of training in all areas where we actually need it. The new growth and skills levy being introduced will replace the old system and include a new foundation apprenticeship that gives young people a route to careers in critical sectors, enabling them to earn a wage while developing their skills. It will also allow funding for shorter apprenticeships, giving learners and employers greater flexibility over their training than under the existing system. I have honestly lost count of the amount of employers who have asked for changes to the apprenticeship levy, and, under Labour, we will deliver.

We are clear about our strategy and that it must be cross-departmental. We are already opening homebuilding skills hubs to deliver fast-track training to apprentices so that we can meet our target of 1.5 million new homes being built. It is clear that Labour has done this before, and we will do it again. More than two decades ago, the regional development agencies understood the challenges in their regions and funded training for sectors where there were skills shortages. I was proud of the very small role I played in setting up a construction academy and providing a boost to HGV driver training in partnership with leaders in FE, the private sector and local authorities, all funded by the East Midlands Development Agency.

Stephenson College in my constituency is a key organisation locally that serves my community. It has a strong role as an anchor organisation, and we should not forget that. It has fantastic facilities for learning and has created an environment for young people to grow and thrive, but it has not been easy. Like so many FE colleges, it has been put under huge financial pressure in recent years. We have to ensure that our colleges are financially sustainable in the long term, and I welcome the recent additional funding for the sector while recognising that there is so much more to do.

There is also a role for Skills England to support constituencies in areas that do not yet have devolved powers. My constituency of North West Leicestershire does not have a devolution deal, but we have just as much potential to grow as everywhere else, and key engagement with local authorities, the chambers of commerce and local employers, as well as the FE and HE sector, will be key in delivering that growth.

Within our approach, we must ensure that we are putting a lot of thought into how regions can work together, so that if we move across boundary lines, we are still met with the same funding and unconditional support. We will drive that ambition as a Government to meet our targets—to go bigger and better than before, ensuring that our legislation has the greatest impact possible. I look forward to the continued conversations on the shaping of Skills England, enabling our young people to develop the skills they need for the future.

[Madam Deputy Speaker (Judith Cummins)]

I call the shadow Minister.

18:34

[Neil O’Brien (Harborough, Oadby and Wigston) (Con)]

I start by paying tribute to the work of Mr Speaker and the Deputy Speakers in driving up the number of apprenticeships in this House. Not only is that creating brilliant opportunities, but it is setting a brilliant example, so I pay tribute to them for the work they are doing.

We have heard some brilliant speeches today, and not just from right hon. and hon. Friends on the Conservative Benches. We have heard really important questions from the Chair of the Select Committee, the hon. Member for Dulwich and West Norwood (Helen Hayes); from the chair of the APPG, the hon. Member for Chesterfield (Mr Perkins); and from the hon. Member for Ribble Valley (Maya Ellis). We also heard a great speech from the hon. Member for St Neots and Mid Cambridgeshire (Ian Sollom). We do not always agree with the Liberal Democrats about everything, but a strength of the liberal tradition is suspicion of centralisation, which is what is in front of us today.

We have three main concerns about this Bill. First, there were good reasons why standard setting was put at arm’s length and closer to employers. As we have heard from Members across this House and in the Lords, this is centralisation, and alongside the other changes that the Government are making, it will risk directly damaging the status of these qualifications.

Secondly, the Government are doing several things that will make it less likely that businesses will take on apprentices, but rather than fixing those problems, the Government are reorganising. Skills England will be the 13th skills body in 50 years—it is yet more reorganisation, rather than a focus on the real issues, and from the Secretary of State’s comments earlier, it sounded as if there might be a further reorganisation later to boot.

Thirdly, we have real concerns that this reorganisation of the machinery of Government will lead to harmful delays in addressing some of the most important strategic issues that we face. Those concerns are borne out by the Government’s own impact assessment. As with the schools Bill, this Bill is highly centralising and does not address the real issues. There are multiple things in the skills system that we need to address, but I am slightly baffled as to why the Government are starting by creating a new agency within the DFE and abolishing IfATE.

It is worth explaining how we got to IfATE in the first place. For decades, people said that they wanted to make apprenticeships more prestigious, and part of the answer was growing higher apprenticeships. The number of people on higher apprenticeships went up from just over 3,000 in 2010 to over 273,000 last year—a huge increase—and the hon. Member for Erewash (Adam Thompson) was absolutely right to talk about how good those degree apprenticeships are. They are great routes into good jobs. Indeed, the latest data shows that the median first degree graduate earned £29,900 five years after graduation, whereas a level 4 apprentice earned more—£33,800 on average.

As well as creating and boosting those higher apprenticeships, the other big change was a shift from a frameworks-based approach to a standards-based approach, and those standards meant a shift to a higher quality. They were led by employers, they had a longer duration—at least a year—and they had more off-the-job training and rigorous final assessments. That was much needed. In 2015, an Ofsted report found that even though some apprentices had been on the job for more than a year, they were not even aware that they were on an apprenticeship, such was the problem of quality. Things were being funded that did not ultimately benefit young people, but did allow employers to pay a lower wage, which was obviously concerning.

The apprenticeship levy was designed to give employers much more ownership of the skills system, and making IfATE independent of Government was a big part of that, creating a properly employer-led system. I pay tribute to the work of IfATE—the Secretary of State did not thank it for its work, but I will do so. IfATE has created and maintained around 690 apprenticeships, supporting around 750,000 people on apprenticeships last year. It created 21 T-levels and 174 higher technical qualifications and enabled employer leaders to set a strategic direction for schools in their sector, and its website is an amazing resource.

However, we now see the Government completely reversing the direction of policy. While we lengthened apprenticeships, they have cut the length of an apprenticeship to eight months. While we grew higher apprenticeships, they are abolishing most level 7 apprenticeships, and by abolishing IfATE and bringing it in-house at the DFE, they are eroding independence and employer ownership. Why are the Government suddenly moving in a reverse direction?

[Peter Swallow]

Does the hon. Gentleman not see that the Government are doing so because this is precisely what businesses are calling for?

[Neil O’Brien]

I will come on to what businesses are saying in one second. The Government are doing two things that are going to be very bad for apprenticeship numbers. First, while apprentices are exempt from national insurance, the Budget—particularly its £25 billion increase in national insurance contributions—is cutting hiring and leading to job losses across the board. What employer groups are saying about that is pretty damning; be it the Institute of Directors, the Federation of Small Businesses or the Chartered Institute of Personnel and Development, they are warning of serious job losses as a result of the Budget. That tax increase, and the damage it is doing, is focused on exactly the type of jobs that apprentices might traditionally get, so apprenticeships are being hit by the backwash from the Budget.

Secondly, the Government are planning to move funding from apprenticeships to other areas. In opposition, Labour talked about allowing employers to spend 50% of their apprenticeship levy funds on other things. As the election drew nearer, that commitment seemed to be disappearing. On 20 November, the Minister said that the commitment to 15% was “currently being reviewed”, but just weeks later, on 9 December, the Secretary of State said that the Government were still committed to “50% flexibility for employers”. It would be interesting to hear from Ministers whether that 50% still stands now.

Given that the levy funds £2.5 billion of spending, 50% is a lot of money to potentially move out of apprenticeships. We can argue about whether that is desirable, but all things being equal, it will certainly cut funding for apprenticeships. We might also be wary that it will undercut the purposes of the levy and have high dead-weight. In fact, the Institute for Fiscal Studies has pointed out:

“In principle, this could help employers to pay for other forms of training that they and their employees would find valuable. But the history of these wider training subsidies, such as the former Train to Gain programme”—

a programme under the last Labour Government—

“suggests that the result is often that much of the spending goes on training that firms would have provided—and paid for—even without the subsidy.”

The apprenticeship levy, whatever its flaws, did at least attempt to address this problem of dead-weight and discouraged freeriding by large firms, so that firms that invested in their workers did not lose out to those that did not. Since the levy was introduced in 2017, real-terms spending on apprenticeships and work-based training has increased in real terms by about a quarter, from £2 billion to £2.5 billion.

In a written answer to me, Ministers have confirmed that the Department has a forecast for the number of apprenticeship starts, but they have also said that they will not publish it. If it was published, it would surely show that removing possibly half of the funding would lead to a substantial drop in the number of apprenticeships. Perhaps that is why we are not allowed to see it. Those same reasons are why the Government are going back to shorter apprenticeships and away from the higher level, reducing quality and cutting length to try to offset the hit to numbers from other Government policies.

There are bits of this agenda where we share the same goals. We all want to see more SMEs offering apprenticeships and more young people getting apprenticeships. Although on average twice as many people started apprenticeships each year under the last Government as under the previous Labour Government, we still wanted that to be much higher. Although we are interested in the same questions, we have quite different ideas for how we address them. Part of the Government’s answer is to abolish the highest level of apprenticeships in order to redistribute the money.

The level 7 apprenticeships that the Government are axing currently account for just 9% of apprenticeship spending, but a lot of good things will potentially be lost by abolishing them. I have been contacted by firms worried about the abolition of the solicitors apprenticeship, which is a great way into the law for people from less privileged backgrounds. One firm worried about that is Bolt Burdon Kemp, which told me:

“This will really impact social mobility into sectors like law, accountancy, and consulting. The traditional route into law is expensive and therefore without the apprenticeship scheme many would not be able to afford to do so. We also believe it will have a wider detrimental impact on the reputation of apprenticeships.”

It has taken such a lot of effort to get that route going, and it would be a huge shame to lose it.

Likewise, level 7 apprenticeships are opening up great jobs and leadership roles in the public sector, too. Some 56,000 people started apprenticeships in the public sector last year. More than half of management apprenticeships at level 7 are in health and education. In fact, they were identified as having a key role in the NHS’s own long-term workforce plan. Public services will lose out, as will ambitious apprentices.

Because level 7 apprenticeships are a small part of funding, I am worried that the Government will now go after level 6 apprenticeships, which is a much bigger share of spending. A lot of employers are worried about that, too. [Interruption.] The Secretary of State sighs as I say that. Presumably when the Minister gets to her feet, she will promise that they will not do to level 6 what they will do to level 7. It sounds like Ministers will be clear when they stand up, will they not, that they definitely will not do that to level 6 apprenticeships.

The last Government moved to make it more attractive for SMEs to take on younger people. From April, 16 to 21-year-olds have had 100% funding, rather than requiring the 5% employer contribution. We need to build on that by cutting bureaucracy and making it easier and more attractive to take on young people. Building on that would be more sensible than reorganisation, centralisation and the defunding of higher apprenticeships. This Bill abolishes IfATE and gives the Secretary of State significant powers as a result, but it says nothing at all about the new body, Skills England, which is intended to be at the centre of the skills landscape under this Government. That has been a pretty unwelcome surprise to some in industry.

In its briefing on the Bill, the Construction Industry Training Board noted that this was

“contrary to the previous characterisation of Skills England that was outlined in the…King’s Speech…and contrary to the vision for Skills England to be an independent body, established in law, with a cross-governmental role”.

The CITB makes an important point. IfATE existed to serve all employers—public and private—and across every Department. In contrast, Skills England will be a part of the DFE. The CEO of Skills England will be a job share between two civil servants who are currently running post-16 skills at the Department. I am told by former Ministers that they are good officials, but this is a recentralisation into the Department—as was pointed out by both the Chair of the Select Committee, the hon. Member for Dulwich and West Norwood), and the Liberal Democrat spokesperson, the hon. Member for St Neots and Mid Cambridgeshire.

[Luke Murphy]

May I ask the hon. Gentleman a question that I asked some of his colleagues earlier? In 2011 the last Government set up the Standards and Testing Agency, whose predecessor was a non-departmental public body that became an Executive agency, like IfATE. It sets statutory assessments for school pupils and develops professional skills tests for trainee teachers. The last Government did something very similar to this. Why was it okay then, but is not okay now?

[Neil O’Brien]

That is an important question. The hon. Gentleman is tempting me to go into the history of apprenticeship regulation in England, which dates back to 1536. I will not detain the House with all the details, but suffice it to say that that was a move from one arms-length body to another, so it was different from this. None the less, IfATE was better than either of those things, which is why we ended up there.

The very act of a further reorganisation is likely to compound the effects of the Budget and the decision to move apprenticeships money into other projects. Indeed, according to the Government’s own impact assessment, there may be a drop in apprenticeship starts while IfATE’s functions are transferred to the Secretary of State. It says:

“The transfer of function from IfATE to the DfE could potentially cause a temporary slowdown in the growth rate of new apprenticeships and technical education courses due to potential delays in the approvals process resulting from the bill.”

It also says:

“This may disproportionately impact disadvantaged learners, who rely more heavily on these pathways for career advancement.”

So there you have it, Madam Deputy Speaker. The Government are moving money out of apprenticeships, and the Budget will also hit numbers, but instead of focused action to boost numbers for young people, the Government’s response has been to reduce quality, cut length and axe level 7 apprenticeships to try to prop up overall numbers. Now we have yet another reorganisation —one that takes us away from an independent, employer-led system, and one that will risk, in the Government’s own words, cutting apprenticeship numbers and hitting the most disadvantaged. Oh dear, oh dear, oh dear.

18:46

[The Parliamentary Under-Secretary of State for Education (Janet Daby)]

It is a pleasure to close the debate. I am grateful for the contributions of Members on both sides of the House; we have heard some excellent speeches. I welcome the points and questions that have been raised, and I will go through as many as time allows.

As my right hon. Friend the Secretary of State said in her opening speech, skills are essential to our missions to drive economic growth and create opportunity. To achieve that, we need a skills system that is fit for the future. In every region, it should provide training options that lead to skilled work and give businesses the skilled workers whom they need in order to grow. I was pleased to hear from Members about the apprenticeships and vocational courses in their constituencies which have led to jobs, but most Members have also referred to significant challenges in our skills system.

Acute skills shortages are a particular issue in some areas. Skills supply does not match demand, and there is not enough business investment in skills. That, however, is what this Government inherited from the previous Conservative Government. We urgently need larger volumes of higher-quality training that meets employer needs, particularly in key sectors. For example, as we have already heard, there is an urgent need to build more homes, but a third of construction employers report finding suitable skilled staff a key challenge.

My hon. Friend the Member for Tipton and Wednesbury (Antonia Bance) mentioned levels 4 and 5 qualifications. In the UK, about 10% of adults hold them as their highest qualifications, as opposed to—shockingly—20% in Germany and 34% in Canada. We must, and this Government will, do better. Skills England, which has been delivering in shadow form since last year, is our new national body for meeting skills needs. It will simplify the skills system now and in the future, combining new functions with improvements in existing ones, within one dynamic body. In its first report, “Driving growth, widening opportunities”, Skills England highlighted the critical skills gaps that currently face the country. Across the UK, more than 2.5 million roles—almost one in 10—are in critical demand. The last Conservative Government seemed content with this, but putting it simply, this Government are not. As my hon. Friend the Member for Basingstoke (Luke Murphy) stated so well, this is about what the Bill will achieve for everyone: it is about growth.

Skills England’s initial assessment of the skills challenges in the economy, together with the “Invest 2035” Green Paper published last year and ahead of the forthcoming industrial strategy, set out how the in-demand occupations of today are also expected to grow in the future. As noted by the Secretary of State, these growth-driving sectors include the life sciences, clean energy, digital and technology, and creative industries. By addressing our skills needs, the UK has a real chance of being a world leader in these fields, but we must do this now: we must not delay. We must build a skills system that looks ahead, and we must anticipate for the future. As was put so eloquently by my hon. Friends the Members for Rochester and Strood (Lauren Edwards) and for Scarborough and Whitby (Alison Hume), Skills England will enable employers to fill our current skills gaps and the likely ones of the future. Excellently, they recognise the need to anticipate our future skills needs.

To respond directly to the points raised by the right hon. Member for East Hampshire (Damian Hinds) and the hon. Member for St Neots and Mid Cambridgeshire (Ian Sollom), users of apprenticeships, employers, providers and assessment organisations regularly complain about the time it takes to update standards and assessment plans. It will remain the default position that a group of people will prepare standards and assessment plans, but removing the requirement to use a group to prepare standards in every instance will speed up the process and reduce administrative burdens. In line with IfATE’s current processes, all new standards and those that have undergone significant revision following review will, prior to being approved, be published online to give interested parties an opportunity to comment. It will only be in the minority of cases where simple and straightforward changes are proposed that these will not be published online for comment prior to approval. However, there will still be mechanisms for users of the system to challenge where a standard or assessment plan is not working in practice and needs revising.

[Sir John Hayes]

I appreciate what the hon. Lady is saying about that, but will she in quick order set out how that will be directed either by the Secretary of State or by Skills England? We need to know not just the detail at the point of publication, but the structural needs in advance of that, so how will that be set out? Will it be set out in guidance—statutory guidance perhaps?

[Janet Daby]

The right hon. Member is absolutely right that these things need to be set out, and they will be set out. This Bill is about transferring the role of IfATE to the Secretary of State and enabling the delivery of Skills England.

Skills England will work with key partners, including employers, training providers, mayoral strategic authorities and unions to form a national picture of where skills gaps exist and how they can be addressed. It will ensure employers have the skills they need to drive economic growth while creating opportunities across the country and building a highly skilled workforce.

During this debate, I have heard Members question the need to close IfATE and establish Skills England. This Government have committed to delivering for the skills sector, and we are listening to the needs of employers. This can be seen in our reformed growth and skills offer, but we must go further to address the fragmentation of our skills system so that we can close the most persistent skills gaps. The Bill paves the way for the full establishment of Skills England by enabling the new body to take on and build out from IfATE’s work to shape apprenticeships and technical qualifications to meet the needs of employers and the economy as a whole.

The scale and urgency of the skills challenge that we face means we are setting Skills England up to have a broader strategic purpose than IfATE, including but stretching beyond the work previously undertaken by IfATE. Skills England will, for instance, provide an ongoing authoritative assessment of local, regional and national skills needs, which is absolutely needed. It will combine the best statistical data with insights from employers and other key stakeholders, and will use these insights to ensure the design of technical education and apprenticeships reflects the skill needs that have been identified, so that we can truly build a workforce fit for the future.

Labour markets and the skills required to increase productivity and economic growth vary considerably by region, and we have already heard from many Members about the different skills that are needed in their regions. Skills England will therefore also have a strong regional footprint, working closely with local skills systems so that they can tap into the comprehensive suite of training offers that it will build across the country. Skills England will also ensure that skills sit at the heart of joined-up decision making across Government. It will work closely with the Industrial Strategy Council, so that we have the skilled workforce needed to deliver a clear, long-term plan for the future economy, and with the Migration Advisory Committee, because growing the domestic skills pipeline will reduce our reliance on overseas workers.

While Skills England will have a broad and ambitious strategic agreement, it will not be able to deliver the scale of change that we need without its taking on IfATE’s important work, so the transfer of functions through the Bill is vital. The Bill does not, however, simply aim to transfer functions. It also includes a number of targeted changes intended to allow the system for designing and approving technical qualifications and apprenticeships to become more agile and responsive; we have been listening to employers, who have told us this is crucial if we are to work together to plug the skills gaps at the pace required. The Bill will provide greater flexibility when designing standards and apprenticeships plans and make processes easier to engage with, allowing experts to invest their time and expertise at the right point.

There is so much I would like to say in response to the many points that Members have made, and I apologise now for not being able to respond to the many excellent points and comments. However, there are a few very pivotal points that I do need to mention.

The Bill was amended in the House of Lords to delay its commencement by a year. It is disappointing that peers voted for a delay to the full establishment of Skills England, despite many Members of the other place supporting its aims. This Government are clear that employers need a fully functional Skills England now—as I have said, they cannot wait. The skills gaps in our economy are holding back growth and opportunity, and we need this Bill to give Skills England the key tools to tackle those gaps without delay. I cannot say that enough.

Skills England is in shadow form, and has already engaged widely, with more than 700 different partners representing thousands of individual organisations through roundtables, cross-section webinars and network events, including the Confederation of British Industry, the Federation of Small Businesses and the Institute of Directors, as well as a range of employers and representative bodies from priority sectors, including digital, life sciences, green, construction and healthcare, and we will continue to listen to the voices of experts to shape what we do.

Question put, That the amendment be made.

18:58

Division 105

Ayes: 70

Noes: 312

Question put forthwith (Standing Order No. 62(2)), That the Bill be now read a Second time.

19:12

Division 106

Ayes: 317

Noes: 55

Bill read a Second time.

Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [Lords]: Programme

Motion made, and Question put forthwith (Standing Order No. 83A(7),

That the following provisions shall apply to the Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [Lords]:

Committal

(1) The Bill shall be committed to a Public Bill Committee.

Proceedings in Public Bill Committee

(2) Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Thursday 20 March 2025.

(3) The Public Bill Committee shall have leave to sit twice on the first day on which it meets.

Consideration and Third Reading

(4) Proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which those proceedings are commenced.

(5) Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.

(6) Standing Order No. 83B (Programming committees) shall not apply to proceedings on Consideration and Third Reading.

Other proceedings

(7) Any other proceedings on the Bill may be programmed.—(Jeff Smith.)

Question agreed to.

Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [Lords]: Money

King’s recommendation signified.

Motion made, and Question put forthwith (Standing Order No. 52(1)(a),

That, for the purposes of any Act resulting from the Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [Lords], it is expedient to authorise the payment out of money provided by Parliament of any expenditure incurred under or by virtue of the Act by the Secretary of State.—(Jeff Smith.)

Question agreed to.