Apprenticeships and Skills (Public Procurement Contracts) Bill

Bob Stewart Excerpts

Friday 1st November 2013 Commons Chamber

[Andrew Gwynne]

I look forward to the hon. Gentleman supporting my Bill and then moving such an amendment in Committee—I will certainly consider it then, if that is what he is willing to do.

The Labour Government also introduced national apprenticeship week, which aimed to give expanded chances and skills a focus for recognition and celebration, and set up the National Apprenticeship Service to help to drive the project all year round. It was launched as a vehicle to promote the real and valuable opportunities we all believe apprenticeships can offer.

The national apprenticeship week has become a central part of the employment and skills calendar. It is a week in which excellence and aspiration in learning, and acquiring skills and trades in areas as diverse as engineering, construction, the hospitality industry, joinery, accountancy and health and social care, are showcased and celebrated.

We can have our political knockabouts in this place, and I have concerns that this Government have slipped back on some of the progress, particularly for young people, but it would be churlish of me not to recognise that they have largely built on the record of apprenticeships and skills training that they inherited from the previous Labour Government. I hope that they, like me, will recognise that more can still be done. I was overjoyed that the Minister with responsibility for apprenticeships said during last week’s Department for Business, Innovation and Skills questions that apprentices in public procurement do have a role. He said:

“Of course we do use public procurement to increase the number of apprenticeships, not least in Crossrail, which is the largest public procurement and construction project in Europe at the moment. It is true that we had to take action to remove some low-quality provision in the 16 to 19 space when we introduced rules to ensure that every apprenticeship was a job, which it had not previously been…We also have a programme in hand to increase the numbers. Participation in apprenticeships is at the highest level ever, which I would have thought all parties would be able to support.”—[Official Report, 24 October 2013; Vol. 569, c. 421.]

Those were the words of the Minister for Skills and Enterprise. So let us see that clear statement of intent through to its logical end by supporting my Bill, as it is very much in line with that statement; let us use public procurement to drive up the quality of apprenticeship opportunities in this country.

We need an ambitious policy on apprentices—this is our challenge—and my Bill goes a small way to helping to achieve that. The Deputy Speaker will not be surprised to learn that I agree with my Front-Bench team that we need a universal gold standard for apprenticeships. That would mean that there would be the same standards and opportunities for young people who do not go to university as for those who do—we must remember that they account for about 68% of the young people in my constituency.

The policy was announced at this year’s Labour party conference by the shadow Business Secretary, my hon. Friend the Member for Streatham (Mr Umunna), and I am extremely pleased to see him here today supporting the Bill. Although the policy is not part of my Bill, it is surely right that minimum standards are introduced, in stages, leading to a system whereby all apprenticeships would last for a minimum of two years—preferably, three years—would be level 3 qualifications or above and would have a focus on new entrants to the labour market. My right hon. Friend the Leader of the Opposition has also said that if a company wants a major Government contract, it

“must provide apprenticeships for the next generation.”

Indeed, at this year’s Labour party conference the skills taskforce published the first of three final reports, “A revolution in apprenticeships”, which looked specifically at how to increase the quality and quantity of apprenticeships, through new minimum standards and a something-for-something deal with employers. That is because a good apprenticeship can change lives just as much as a degree can.

There are already good examples of apprenticeships in my constituency, and I have mentioned the Tameside 50:50 initiative. Young people in areas such as Tameside are among those with the fewest opportunities to access the jobs market, yet it was Labour-controlled Tameside metropolitan borough council, working with the previous Labour Government, that ensured that contractors for schemes such as Building Schools for the Future took on apprentices as part of the Tameside Works First initiative. I commend to all hon. Members the fantastic new facilities at Denton community college. I should perhaps declare an interest, as my wife is chair of governors of that fantastic new school, which achieved 96% A to C grades at GCSE this year. Those are the best ever results, achieved in superb state-of-the-art facilities. The contractor that built that school, Carillion, took on no fewer than 13 apprentices as part of the construction project, because that was required by Tameside’s council under the Building Schools for the Future initiative. That was good public procurement practice levering in apprenticeships and skills training, and leaving a lasting legacy, not only in employment opportunities for those young apprentices, but in the form of a superb new school driving up education standards in my community for the future.

Tameside council restated its commitment to apprenticeships at the Tameside skills summit on 28 March. It set the challenge to its partners in Tameside to achieve 100% participation by 16 to 24-year-olds in education, training or a job with training by 2020.

[Bob Stewart (Beckenham) (Con)]

I suppose the hon. Gentleman also accepts that it is sometimes difficult for a small company, consisting of fewer than 10 people, to have a formal apprenticeship scheme. In such cases, we might be talking about giving a job rather than having a formal apprenticeship scheme.

[Andrew Gwynne]

That is absolutely right. The Bill is not prescriptive and it relates to public procurement contracts in excess of £1 million, so the local public body “may” seek a commitment to skills training or apprenticeships as part of a contract. That can be carried out through a variety of means—

[Bob Stewart]

For a young person—

[Andrew Gwynne]

For a young person. That can be carried out in a variety of ways, one of which the hon. Gentleman outlined. Of course, however, it would be incumbent on that company or group of companies to explain what it is doing as part of the bid process. It would then be down to the public body to determine whether that meets its aims and ambitions for its local economy, but he is right in what he says.

Through the Tameside apprenticeships scheme, the local council has committed to helping small companies such as the ones the hon. Gentleman mentioned to take on apprentices, in response to feedback received about the difficulties they may experience. Those difficulties relate particularly to the construction sector, and some other sectors, where an employer cannot guarantee that contracts will last for the full 12 months or more of the apprenticeship. Tameside apprenticeships, a partnership between Tameside council, Tameside college, New Charter housing trust and the Tameside learning provider network has set a target to achieve 100 additional apprenticeships in the borough in the next 12 months.

If the employer has to withdraw from the agreement, the council has undertaken to pay the apprentices’ wages for a month while a replacement employer is found. As I have already said, the 50:50 scheme set up by Tameside council also provides up to 50 apprenticeship grants of £1,000 each to employers who take on 16, 17 or 18-year-old Tameside residents. It has been a huge success.

Good apprenticeship opportunities are also offered by the local housing association, New Charter housing trust. During apprentice week this year, it showed its continued support for apprentices with a pledge to take on at least 20 people from April, doubling the number of apprentices from the previous year. The trust has apprentices in a range of roles across the company including in administration, domestic gas engineering, painting and decorating and plastering—all good apprenticeships that can offer a ladder to a future career. New Charter has also taken on a role as lead partner in a new housing apprenticeship scheme for Greater Manchester called “Foundations in Housing”, working with other housing associations across the county.

In the Stockport part of my constituency, there is the 100 apprenticeships in 100 days initiative. Stockport council, which, incidentally, is Liberal Democrat controlled—I do not often have good words to say about the Liberal Democrats but today I will break the habit of a lifetime, even though it is noticeable that no Liberal Democrats have turned up to support the Bill—has worked with local employers to get them to take on more apprentices. Within the 100 days, the scheme’s target of 100 apprentices was soon reached and the campaign will now run until mid-November. It has been such a success that it has secured about 152 extra apprentices so far.

I also want to consider some of the good work being done by central Government. We know that since July 2011, the Department of Work and Pensions has been operating its apprenticeships and skills requirement contract schedule, which requires:

“The Contractor shall and shall procure that its Sub-contractors shall take all reasonable steps to ensure that 5% of their employees are on a formal apprenticeship programme.”

We can see from that initiative how the same formula could be applied directly elsewhere and in other Government Departments beside the DWP. Many more apprenticeship places could be created if the Government really wanted to expand apprenticeships in the public sector and through public procurement. I believe that my Bill can help the Government to facilitate that.

What better spur to action can there be for the two thirds of businesses that still do not offer apprenticeships than the knowledge that they are crucial to the Government and to working with the Government? Government, whether local or national, realises that it must be the responsibility of public procurement to do all it can to give young people a chance to get experience as an apprentice. Having an hands-off approach is simply not good enough and I commend the Government for recognising that in at least one of their Departments.

As I said in my opening remarks, all Members of this House celebrate the value of apprenticeships in providing opportunities and developing the skills of our work force and our future work force. We need to have more quality apprenticeship opportunities, however, particularly for young people at a time when nearly 1 million young people are out of work. I believe that my Bill would be useful and helpful to the Government in promoting that. It is common sense that the Government and public authorities are uniquely placed to use the leverage of the money that they already spend on procurement of public services to promote skills training and to provide new apprenticeship opportunities. That should be part of the procurement process.

The Bill is a relatively simple idea. Every supplier winning public contracts worth more than £1 million may be required to offer apprenticeship opportunities if that is the desire of the relevant public body. The Bill is not prescriptive and it does not compel, but it does empower. It would mean that companies applying for certain public procurement projects could be asked to include and offer quality apprenticeships as part of their bid if the public body wants that. My Bill would ensure that all apprenticeships offered as part of a public procurement contract would have to be advertised to all local workers, ensuring that those looking for a job would have a chance to apply and to be successful.

My Bill focuses on advanced and higher level apprenticeships, at levels 3 and 4, to ensure that we have apprenticeships that can rival university degrees. We should consider that point, given that in my constituency 68% of young people—and no doubt a similar proportion in the constituencies of other right hon. and hon. Members—or 50% of young people across the country do not have the opportunity to obtain a higher education qualification.

--- Later in debate ---

[Lyn Brown]

I absolutely agree, and I am grateful to my hon. Friend.

The London Legacy Development Corporation is aware of the transient nature of the work force in sectors such as construction and has asked its contractors to monitor the length of their workers’ residency. When we were building in preparation for the Olympic games, we were keen to make sure that local people, who were being severely disadvantaged by the construction process, were able to take advantage of the opportunities that came their way.

We set up lots of monitoring schemes to find out whether the people getting the jobs and apprenticeships came from the area. Unsurprisingly, people moved into the area to take up the jobs and apprenticeships and then moved out, taking with them their skills and spending power. That, obviously, is not great; we wanted to transform the local area and make sure that local people had the advantages.

[Bob Stewart]

Has the hon. Lady any idea of how many people who were apprentices for the Olympic build successfully moved into permanent employment as a consequence of that training? Do we have that figure?

[Lyn Brown]

I am not sure whether the figure is available, but I will check that out and pass a note to the hon. Gentleman as it would interest me too. However, we did discover that apprentices based in Salford, Gateshead and Newcastle came with their firms to the Olympic park to complete their apprenticeships. Although we got additional apprenticeships, the Olympics provided opportunities for companies based elsewhere in the UK to bring their work forces down and keep them employed while we waited for the worst of the recession in building to move on or for additional work to be found.