Skills and Post-16 Education Bill [HL]

Debate between Lord Forsyth of Drumlean and Lord Aberdare

Report stage
Thursday 21st October 2021 Lords Chamber

[Lord Aberdare (CB)]

My Lords, I fully support what the noble Lord, Lord Layard, described as the first half of Amendment 50, but I am rather less comfortable about the approach taken in the second half, requiring any employer receiving apprenticeship funding to spend at least two-thirds of it on people under 25 beginning apprenticeships at levels 2 and 3. That is an aim I entirely support, but I am not convinced that putting the onus wholly on employers to deliver it is the right way of going about it.

One of the concerns employers have regularly expressed about the current apprenticeship system is its lack of flexibility. This amendment would not only reduce the flexibility available to employers but impose extra requirements on them to manage their apprenticeship programmes and an extra level of bureaucracy resulting from the process of enforcing the requirements.

Employers already find it difficult to spend their levy funds, which is why so many apprenticeships go to reskilling and upskilling existing employees. The energy and utilities sector, which has a very good record of employing apprentices, has managed to spend on average only 54% of the levy funding available to it, so it is not as if there is not more money available. All that they do not spend just goes back to the Treasury.

I believe a better approach might be to introduce that extra flexibility into the apprenticeship levy system itself, to make it easier and more attractive for employers to offer more apprenticeships at these levels to younger people. This could be done through, for example, enabling part of an employer’s levy funds to be used for pre-apprenticeship training initiatives in schools to identify and prepare young people who might then be suitable candidates for apprenticeships. I am sure there are other ways of motivating employers to offer more apprenticeships of this type, rather than introducing additional rules that could lead to their providing fewer.

I support two and a half thirds of this amendment, but I am slightly uncertain about the mechanism that the noble Lords are implying to address the third one.

[Lord Forsyth of Drumlean (Con)]

My Lords, I have not participated in any of the proceedings on this Bill, partly because I chair the Economic Affairs Committee and we are looking at central bank digital currencies at the moment. But I bumped into the noble Lord, Lord Layard, who pointed out to me that this amendment is entirely in line with the recommendations made by the committee in its report, Treating Students Fairly, which was published in June three years ago. I shall not repeat the arguments so eloquently put by my noble and learned friend Lord Clarke of Nottingham, with every word of which I agree, but it was set out clearly in that report, more than three years ago, that the apprenticeship levy was not working. Indeed, we found that larger employers who were running very effective apprenticeship schemes had simply abandoned it, treating the levy as a tax, and done their own thing.

My noble and learned friend spoke about the way in which all the financial incentives are to keep people in schools and send them on to universities, where they do courses which do not enable many of them to use the skills and achieve the kind of living standards which they aspire to. In short, we probably need more plumbers, electricians, specialists and engineers than we do people who are experts in media studies. I am not saying that media studies is not a serious subject—well, actually, I do think that it is not a serious subject, but that is probably going to get me a lot of abusive emails. I am disappointed that, as this matter was discussed in Committee and as there has been so much about it in the all-party unanimous report, the Government are still dragging their feet on the matter.

When we discuss future topics in our committee, one thing that is regularly suggested is that we look at productivity. We always reject it, on the grounds that it is such a broad subject and so difficult, but this matter is absolutely central to productivity and, even more importantly, offers a future to so many of our young people. So I hope that my noble friend will consider this amendment. I take the point about providing flexibility.

One thing that struck me—and I know that the Government have taken some action on this—was that one of the officials who gave evidence to us proudly announced that the apprenticeship scheme had been used to send her to business school. Of course, that is the antithesis of what the scheme should be. I am not up to date on what has happened since, but there were some 400 different types of rules for different organisations, and the whole thing had become utterly bureaucratic.

The noble Lord, Lord Layard, referred to the Robbins committee. Those of your Lordships who have not read the report should just read the introduction; it is written in the most beautiful prose. It sets out the objectives, from all those years ago, and this amendment is central to achieving them.

When we were looking at treating students fairly, one thing we got in evidence was a diagram showing all the initiatives that had been taken by various Governments for training, and all the changes in names and so on. It is an unbelievably complicated process—not just YTS; there are literally tens and tens of different initiatives. What we need, in the words of Her Majesty the Queen, is perhaps less talk and more doing in this area. This amendment is a very important step forward if the Government decide to accept it.