Apprenticeships

Baroness Wall of New Barnet Excerpts

Thursday 14th October 2010 Lords Chamber

Moved By

[Baroness Wall of New Barnet]

To call attention to the case for maintaining and increasing apprenticeships in both the public and private sectors; and to move for papers.

[Baroness Wall of New Barnet]

My Lords, I am delighted to have the opportunity to open this important debate on apprenticeships. What, at heart, is an apprenticeship for? It is meant to take an individual to an entirely new level of skills and competence through a coherent programme of study and practice. It should provide a company with a skilled employee who has demonstrably developed their abilities. Indeed, businesses such as BAE Systems and Airbus tell me that apprenticeships are critical to meeting their future skill needs. An apprenticeship should give an individual a broad base of useful skills, specific competencies in a technical area and the wider attributes that we call employability. That makes a firm foundation for a career and for progression, if they wish.

I shall focus on the engineering apprenticeship scheme. The scheme is very popular, yet employers still face practical barriers when considering whether to start or increase their participation. Most of these barriers are more commonly cited by small firms, but some are cited by larger companies. What the barriers have in common is that they can in some way be addressed by the Government, funding, employers and sector bodies all working together. I shall address how we can help employers to overcome these current barriers before concluding with some thoughts on the future of apprenticeships. I declare an interest, as I work with Semta, the sector skills council for science, engineering and manufacturing technologies, which is closely involved with the employers in this scheme.

The first barrier is cost. Employers of engineering apprentices will tell you that it costs them a lot to recruit and train their apprentices. An advanced engineering apprenticeship costs the employer a great deal in terms of salary and supervision, even when the actual training costs are covered by public funding. BAE Systems estimates that it costs it £73,000 to train an apprentice on top of government funding. That is a big commitment even for a large organisation, but small firms can find it a particularly difficult barrier to surmount.

The price of an apprenticeship is a reflection of its rigour and content. We can, of course, always look at how to deliver the content at lower cost, using new technology such as e-learning, where appropriate, and maximising economies of scale. Engineering apprentices are paid very well compared to apprentices in other sectors and, indeed, in other countries. That pay reflects their value to the employer and the demands of the framework; it is not and should not be easily changed.

A second barrier for employers is time. The advanced engineering framework usually takes 42 months to complete—a significant time commitment to ask of a company. Some feel that they cannot see that far into the future when planning their training. Semta has done a lot of work on fast-tracking for apprentices, particularly those who are already in the workforce and have achieved a certain level of skill. For adults on an apprenticeship programme, certain elements can be shortened by accrediting prior knowledge. However, all the businesses that I have talked to say that it is imperative that the outcomes are the same, no matter the age of the individual on the programme. Thankfully, we have moved away from the time-served approach to apprenticeship, where people were believed to have completed an apprenticeship simply by working with an expert for a given period of time. Instead, apprentices must now demonstrate their competence against national standards, which has led to a far more rigorous and effective programme.

The third barrier relates to the company’s ability to deal with the paperwork and reporting involved. Apprenticeship frameworks that attract public funding must of course be accountable for, and transparent about, that income. It can be confusing for companies to deal with the necessary paperwork, particularly if they have not offered apprenticeships before. The running of an apprenticeship scheme also requires a great deal of management, not just of the paperwork to get the funding but also of the programme itself. Airbus tells me that ensuring that the apprentice is receiving the right training at the right time, achieving all the necessary milestones and taking on the right roles as they become more competent needs someone checking on their progress and addressing any issues.

This is an area where the engineering sector has led the way in its approach. Many years ago, group training associations were set up by groups of small firms getting together to run apprenticeships and other training schemes. The GTA handles the funding contract and manages the schemes itself. It provides member companies with an invaluable service. The local GTA can manage the recruitment of the apprentice, which is vital for small firms seeking a person who is good and a good fit for their business and for the investment that they are making. The GTA can also work with the local college to ensure that all the off-the-job elements of the framework meet the employer’s needs and that the apprentice is fulfilling their true potential on the programme.

Another approach has seen large companies helping their supply chain companies by training for stock. Whenever funding has permitted, this has been embraced. This has meant the large firm taking on extra apprentices, who then find places in smaller companies in their supply chains. Large companies welcome this opportunity, as it enables them to boost the skills of their partner companies, while the apprentices have the opportunity to experience the breadth of activity that a large firm undertakes.

A barrier that has certainly impacted on some companies in the past is the quality of applicants that they have received for apprenticeship places. While large companies are usually able to fill their vacancies with excellent people, smaller firms have sometimes struggled to find the right person to become an apprentice. This has been linked to poor careers advice given to young people, who have been led to believe that low academic achievement and poor attitude are no barrier to entering an apprenticeship programme. For engineering this is simply not the case and companies can waste a lot of time removing unsuitable candidates from the recruitment process.

In recent years, thankfully, that barrier has reduced in impact, as more young people seriously consider alternatives to the costs and career progression for full-time academic study post-16 and post-18. Businesses such as BAE Systems have seen many high-quality applicants apply—so much so that the company is now supporting typically 10 per cent of its apprentices on completion to take university degrees.

With cost, time, the need to run the framework to a certain standard and the quality of applicants identified as barriers, is the answer to make apprenticeships shorter and cheaper, to make them less accountable to national standards and to reduce entry requirements? I fear that that seems to be the situation that some are facing at the moment.

Pressure on funding has resulted in Semta facing risks to the content of its framework. It has been told that key elements of the framework—namely, the initial training done by all apprentices through a national vocational qualification called performing engineering operations—cannot now form part of the framework. Removing this essential introduction to safe working in engineering environments and to basic engineering skills would damage the engineering apprenticeship immeasurably. Employers are simply not in a position to fund this element themselves for every apprentice whom they recruit. The argument is that this NVQ, which is taken in addition to the NVQ in the specific engineering discipline of the apprentice, is somehow surplus to requirements. This shows a lack of understanding of the true nature and purpose of apprenticeships, as well as a failure to appreciate how the current structure is designed to be a coherent basis for progression and a sustainable career. It also demonstrates that there are currently pressures on sector skills councils to somehow compromise on the content of their frameworks, which they have developed with employers.

Up to this point, I have highlighted some areas where practical barriers can be reduced without compromising the quality. I will now move on to the philosophical barrier that is at the heart of ensuring that apprenticeships remain the right programmes for individuals and companies. We must not see apprenticeships as a panacea for all skills problems in the workplace. It is important that employers understand what an apprenticeship will deliver for them and that they do not enter into a scheme without knowing the full implications. Advice to employers needs to be clear and needs to explain that, if what they are offering is not an apprenticeship, they should understand that that is not what they are doing and that, rather, they require something else.

Semta works hard to make the engineering apprenticeship framework fit for purpose, but that purpose is not to provide cheap labour for companies or to string together an incoherent set of units and call it an apprenticeship. In some ways, the size and rigour of the engineering apprenticeship could be called a barrier to its expansion, but the quality of the framework is one of its great selling points to both the individual and companies. I accept that to compromise this might bring in some short-term increases in participation, but it would soon result in a lower standard that did not give the business the full range of skills that it requires or give the individual the mobility within the company or outside it. Additionally, it would cheat the future economy of the United Kingdom of a skilled person who could contribute fully.

Apprenticeships have predominantly been used for young people who are usually new entrants to a sector and an occupation. However, it has been found that, when the funding for adult apprenticeships was available, there was a huge appetite among people over 25 and their employers to use the apprenticeship programme to boost the skills of the existing workforce. This is because the framework can be used to raise the skills of those already in the workforce who need to boost their competence and who can benefit from a comprehensive programme of development.

What is an apprenticeship not suitable for? It is not, as I have said, for companies wishing to recruit cheap labour for jobs that do not require a minimum level of skills. It is also not for adults who need only a few elements of the programme to enable them to reskill or upskill. For these people, we must make sure that the qualifications and curriculum framework provide opportunities for funding and accessing bite-sized learning, tailored to the prior knowledge of the individual so that they are not repeating what they already know. This is not an apprenticeship, though; it is still valuable, but it is different.

Maintaining the apprenticeship brand by ensuring the quality is the single most important thing we can do to safeguard the programme for the future. Doing so will ensure that we can get the right people on to an increasing number of these schemes. Only then can we be confident that great apprentices will continue to contribute to the wealth of the country, that companies will have the right people to grow their business in the future and that young people and older people will be able to contribute to the community and to the businesses that they work with. I beg to move.

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[Baroness Wall of New Barnet]

I thank all noble Lords who have taken part in the debate this afternoon. I anticipated that it would be very interesting, but even I have been surprised by the things that I have learnt. I thank the Minister for her suggestion that she has learnt something today. I always take the view that if you participate in something but do not learn something, what was it all about? That applies to me and, I hope, to her, today.

I do not intend to go through all of the various points that have been raised. To some degree, I share the views of my noble friends Lord Sugar and Lord Haskel about FE colleges. Some FE colleges are great; some are less than great. I know from my experience that there is a lot to do to build some of them up to be the very best. We owe that to the young people who are going through their apprenticeship off-the-job training with them.

My noble friend Lord Sugar mentioned the importance of mentors. I ask the noble Lord, Lord Wakeham, whether he could recommend a mentor to me, because I am really disappointed that he did not suggest that he would give me an honorary degree. Obviously, I need to do better, and I can do better only if I am mentored.

[Lord Wakeham]

I thought that I said that if anybody wanted to make an application, I would do the best that I could.

[Baroness Wall of New Barnet]

I am verbally making the application, and I will make sure that I follow it up in writing.

Again, I thank everybody who has spoken; it has been a tremendous debate, with lots of good suggestions. To refer to a comment by my noble friend Lord Young in response to the suggestion of the apprentices’ day, he was being a bit humble, because he has supported me on a request on several occasions to come to a number of businesses to present awards to apprentices. The celebrations that happened on those occasions have been marked by big and small companies. I thank my noble friend, but I also thank the noble Lord for recognising, as the Minister described, that that is not only acknowledging what people have done but encouraging others in giving apprenticeships the value that they need. I beg leave to withdraw the Motion.

Motion withdrawn.