Apprenticeships

Baroness Burt of Solihull Excerpts

Monday 19th December 2011 Commons Chamber

[Lorely Burt (Solihull) (LD)]

Apprenticeships are one of the key tools we as a Government have at our disposal both to tackle youth unemployment and to skill our young people to serve the needs of industry both today and in the future, when there will be increasing demand and the country will need to be able to achieve the growth we all desire. I do not intend to ruin the positive ambience we are fostering with the Opposition this evening, but I must say that the last Government concentrated on higher education, sometimes at the expense of apprenticeships. That is not to say that higher education is not important; it is hugely important, but it is not all-important. The last Government did increase the number of apprenticeships, but it was by an average of 13,000 a year over eight years, whereas this coalition Government have raised it by 160,000 over one year alone.

I do not want to talk about the past, however. The past is past and today we face a new series of challenges. I therefore want to talk about what those challenges are, what the coalition Government are doing already, and what else we might do to develop this success story even more.

We do have a good story to tell. Provisional data for the full 2010-11 academic year show that apprentice starts increased by over 50%, to 442,700, with increases at all levels and stages, contrary to the assertions of the hon. Member for Sheffield Central (Paul Blomfield). There has also been a strong increase in completions, to 181,700. That is mirrored in my constituency of Solihull, where the increase is 53%.

We want the figures to rise even further and faster, but to achieve that we must identify the obstacles preventing employers from recruiting more apprentices. Red tape is a culprit, and I would give special prominence to health and safety red tape. Clearly, we cannot put young people at risk, but from this January employers and trainers will no longer have to comply with the additional health and safety requirements imposed by the Skills Funding Agency. Employers will have to comply only with the Health and Safety Executive’s requirements as set out in “Health and safety made simple”—if that is not a contradiction in terms.

Small businesses are obviously a key area that we need to target, as several hon. Members have said. The Federation of Small Businesses reports that only 8% of businesses surveyed had taken on apprentices last year but 28% said that they would do so if there were a wage subsidy. The FSB very much welcomes the incentive payment recently announced and says that

“initiatives like this will help the smallest of firms to take on young people.”

[Mr Robin Walker (Worcester) (Con)]

Would the hon. Lady recommend the initiative taken by Worcester city council? A small subsidy can, in some cases, make a big difference, so it is providing £500 to small businesses that take on their first apprentice.

[Lorely Burt]

I would definitely commend the hon. Gentleman’s local city council.

I also suggest that the payment of £1,500 should be available to as wide a range of businesses as possible. I would welcome greater clarity on how the money will be targeted and what the eligibility criteria will be. I would be grateful if the Minister elaborated on that in his remarks, particularly given that the FSB wishes to take advantage of this as quickly as possible. For small businesses that may not have the time and wherewithal to organise courses for their apprentices, the FSB would like the use of apprenticeship training agencies and group training associations to be expanded. The ATAs would employ the apprentice and lift the administrative burden for the small business, while GTAs enable employers to come together to offer the right training to meet their needs.

Other barriers that the Government should be addressing are outlined by the United Kingdom Electronics Alliance. It talks about schools and universities

“releasing students onto the jobs market without key life skills such as communication, practical problem solving, work ethic and an understanding of manufacturing and the role it plays in the economy.”

We are back to the “oily rag syndrome” of ignorance, where many young people have little idea of what manufacturing really is; a key area that we need to address is how to give kids an understanding of what exciting futures are out there, and these futures involve ingenuity, creativity, imaginative design, great job satisfaction and good money. We have to link schools up with companies while kids are at a formative stage, to open their eyes to the possibilities of what is out there and crying out for their skills and aptitudes. When these young people have a realistic idea of what the world of work is like, they will focus on the skills that the UKEA talks about.

The coalition Government are also doing some good things for higher apprenticeships. The higher apprenticeship fund will support the development of up to 25,000 new higher apprenticeships at levels 4 and 5, which compares with a figure of just 200 in 2008-09. The shadow Minister talks about achieving by hand or by brain, but surely the pinnacle of achievement in manufacturing comes about by hand and by brain.

The UKEA also suggested that a tax credit would “de-risk” the decision for companies willing to set up apprenticeship schemes and that we could introduce the idea of leaving money on the table if a company does not invest—this is a push-pull strategy. I would be interested to hear the Minister’s views about using tax credits in that way. I could say more, Madam Deputy Speaker, but other colleagues wish to speak. Of course we need to do more, but we have made a pretty reasonable start.