Skills: Importance for the UK Economy and Quality of Life

Lord Patten Excerpts

Thursday 9th May 2024 Lords Chamber

[Lord Patten (Con)]

My Lords, there is a lot of evidence that, once a certain standard of living is reached—economic security in particular—good relationships, happy families, and friends and community quite often follow, although not always necessarily, and both of these depend on skills and on the effort made by all of us on improving the quality of life, as the noble Lord said in his opening speech. There are quite a lot of both of these attributes, good skills and good quality of life, in the United Kingdom.

I do not go quite as far as Cecil Rhodes in his bombastic dictum in another age that to be born an Englishman is to have won first prize in the lottery of life. There may be one or two on the wilder shores of my party who have that view of life, but I will not tempt myself to name them today. However, it is a fact that lots of people want to come to the United Kingdom, which I am glad about—I do not speak of the dangerous lives of people seeking to come to our shores illegally. There are queues of people who wish to come here for the attributes that the United Kingdom has, and we should not just forget that and say that everything is a terrible problem.

I will give some examples. The City of London remains a destination ranked way above a Paris or a Frankfurt by generations of polls of those wishing to come to work in the financial services area, where I work. Our best universities remain a target, too, for undergraduate and postgraduate students who want to get proper legal entry into our best universities. We have some great universities, with always three and sometimes four in the top 10 and in the top 100—I forget the figure; doubtless my noble friend Lord Willetts will know what it is, but an awful lot of our universities are ranked in the top 100. We also always welcome a lot of outside direct investment. The UK remains the second biggest destination in Europe for foreign direct investment, and this is led by tough-minded investors from the US and India. These people must have spotted at least a few useful skills that we still have around.

Yet the paradox remains that, despite this, decent skill levels do not automatically lead to increased productivity, which is a mystery that I think the noble Lord, Lord Aberdare, referred to when he spoke of productivity. It is particularly poor in the United Kingdom. It is a genuine mystery, and a lot of very clever people are trying to provide the answer as to why it is there, but we have not yet got it. According to the Office for National Statistics in its report last week, the biggest drops in productivity are in the public sector, and they are in education and in health, which are critically important to all of us.

A lot of effort is being put in via policies of different sorts to improve this, notably by levelling up. However, a generation takes a long time, and we are often told that the levelling-up policy will take a generation. A generation is 20 or 30 years and change takes time. So I applaud the realism of the Secretary of State for Levelling Up, as reported by the Financial Times of 30 April, who said that it remains “work in progress”, describing the process as like “building a cathedral”—and they often take longer than one or two generations. So it is extremely important that we deal with the unsolved mystery of why our productivity is so low.

We must also recognise that skills have lots of attributes that are hard to teach formally, but, if they are not acquired or imbued in some way, all the doctorates or degree apprenticeships in the world will not benefit and bring the skills of life with them. I pay tribute to the noble Lord, Lord Blunkett, who said in a speech during a debate which he initiated back on 7 March that we had to be realistic about the problems that the university sector is facing. He is right, I think, that we are facing a bit of a sub-prime issue—I will not overwork it by calling it a sub-prime crisis—in a number of our universities, where we have seen, alas, a lot of sacking of staff and abolition of courses. This is always brought in with a lot of management speak, even by great universities such as Goldsmiths, which has announced that it has a “transformation programme”. Once you see a transformation programme coming and vice-chancellors running for the hills, you know there is trouble. We are facing, there and in a number of our underperforming universities in this country, a bit of a looming sub-prime problem, which the noble Lord, Lord Blunkett, was absolutely open in saying that we have.