Apprenticeships

Baroness Morgan of Huyton Excerpts

Thursday 15th October 2015 Lords Chamber

[Baroness Morgan of Huyton (Lab)]

I would also like to thank my noble friend Lady Prosser for this timely debate today. There is always a danger that we fall into collective patting on the backs and a warm glow when we talk about apprenticeships. In some ways, what we should really be proud of, arguably, were the old-style apprenticeships, so I would like to ask today: how do we look at what worked, learn the lessons of success and failure and modernise for today and tomorrow’s world of work?

We often ask in some bemusement why we do not do skills training as well as Germany, to take one example. The answer is pretty simple. We had a fully functioning system like other European countries. In the 1950s, over half of male school leavers went into apprenticeships. Decline really accelerated from the 1970s with recession and falling numbers of jobs in traditional industries. Unfortunately, successive Governments did not then reform and update apprenticeships; they pretty well destroyed them. Out went the core employer-apprenticeship relationship with a combination of quality workplace learning and more formal education; out went the expectation that employers would contribute to the off-the-job costs; and out went the strong and flexible connection between the needs of the local employment market and what was offered via apprenticeships. What came in? A well-meaning but poorly conceived new centralised system of national vocational qualifications based on competencies promised great progress on productivity, but it did not really deliver.

Apprenticeships became popular again with all parties from the 1990s, but the focus since then has been on numbers, not quality. There have not been apprenticeships as we would collectively envisage them, with some very notable and high-quality exceptions. The apprenticeship scheme in the past 20 years or so has been characterised by being heavily focused at level 2, at GCSE level, not a higher level, as required by the economy. Typically, it involves a low-skilled worker who receives pretty poor training. They have been heavily skewed, too, to workers over 25 years of age who previously would have been trained by employers, not on government-funded schemes. The Digital Skills Committee, which I chaired, received candid evidence from a range of employers who said that skills training at FE colleges is too often inadequate to their needs. They also admitted that, since the 2008 recession, they have largely ceased to fund proper training and, because of skills shortages, fear that if they train employees they will be poached by others. Recent Ofsted reports have said much the same thing.

In summary, a combination of central targets for apprenticeship starts and the outcome-based funding system has incentivised providers of training to engage in a drive to the bottom. Large numbers of short, low-level and often low-quality apprenticeships have been favoured over more rigorous, longer, high-quality apprenticeships. That has been coupled with drastic cuts in FE colleges, which are likely to get worse, affecting largely low-skill, poorly educated, often disadvantaged young people. I confess that I scratch my head that funding lunches for all primary children is a higher priority than FE colleges.

Building on the Richard review and the trailblazers programme, there needs to be fundamental reform. In this context, I strongly welcome the new levy. It is essential that apprenticeships are funded at the sort of level that our competitors have done for many years. But I am anxious rather than excited about the 3 million target. I am sympathetic to writers of manifestos—I have certainly been there myself—but we must not again chase numbers rather than quality.

So what do we need? Apprenticeships have to, again, reflect labour market needs, develop young people’s skills to a high level and make a real contribution to increasing productivity. As in Austria, Denmark, France and Germany, we need high-quality, on-the-job learning and high-quality, off-the-job learning in education and training. This is a very big jump from where we are now. We also need to focus on developing advanced- level apprenticeships. There is lot of noise about higher apprenticeships but in reality the numbers are tiny. Yet this is precisely where we need to focus our efforts if we want a genuine alternative to university, and if we want to meet the serious skills shortages that we know are present in our economy. That is precisely where our competitors deliver their numbers.

Core to the success of new apprenticeships is the involvement—indeed, the active and enthusiastic support—of employers. That has been seen in the trailblazers programme. Now we need to reform the whole system, to recreate the self-reinforcing mechanism that originally produced great apprenticeships. The new fund will certainly help enormously, but my plea today is to do quality as well as quantity—indeed, to put quality before quantity at first. If you want one measure, do not let it be the 3 million; let it be where apprentices are one year after they finish their scheme. That should be the key measure of whether or not they have the right jobs and whether they are meeting the needs of the local economy. I should be really interested to hear from the Minister whether that measure is being considered.