Building a High-Skilled Economy

Ed Davey Excerpts

Thursday 17th June 2010 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Davey)]

It is a great pleasure to welcome you, Madam Deputy Speaker, to the Chair. You and I debated with each other over many years while you were a Minister, and I particularly remember when you were Paymaster General. I know that, given your knowledge of the tax system, you will be looking forward to chairing a debate on the Finance Bill to take you down memory lane.

This has been a high-quality debate which has been conducted in a cross-party way, as different right hon. and hon. Members have made positive contributions. As my hon. Friend the Minister said in his opening remarks, he is listening to the contributions of all Members. We have also heard about football and have almost had an exercise in VisitBritain as we have gone around the country.

I will not be able to talk about every maiden speech, but their overall quality was superb. When I made my maiden speech, I was rather more nervous than those delivering the self-confident and assured maiden speeches that we have heard today. If I may, I shall take a tour d’horizon of those speeches. We had cock and bull from the hon. Member for Milton Keynes South (Iain Stewart); we had a Conservative club haunted by Roundheads from the hon. Member for Romsey and Southampton North (Caroline Nokes); and we had a Yorkshire vineyard from the hon. Member for Colne Valley (Jason McCartney), as he talked about the “Last of the Summer Wine”.

Two hon. Members showed great perception in how to represent their constituencies. I am thinking of the hon. Members for Cleethorpes (Martin Vickers) and for Rossendale and Darwen (Jake Berry), as they listed their local newspapers in their speeches. I have always found that when I talk about the Kingston Informer, the Kingston Guardian, the Surrey Comet and Radio Jackie, it is always a very good way of representing one’s constituents.

As I mentioned earlier, we also heard about football, as Members talked about the various football clubs in their constituencies. I have to make a confession—I am a Kingstonian fan because they play in Kingston, and I am also an AFC Wimbledon fan, as the club shares the Kingsmeadow ground. I have to say to the hon. Member for Milton Keynes South that although he has the MK Dons, we have the real Wimbledon playing in my constituency. I also have to confess that, although I was born in Nottingham and my first team is Notts County, I am also a Liverpool fan. Let me explain why. I was the only member of the class who was a Notts County fan during the Clough years, so I had to support one team that was giving Nottingham Forest a hard time.

I therefore particularly enjoyed the speech of the hon. Member for Broxtowe (Anna Soubry), as I know her constituency fairly well. I have never lived there, but I used to go to Nottingham university boating lake. I will not go any further into that, but we had some nice times there. As a student, I worked in Boots, which has a factory in the hon. Lady’s constituency, and during my student vacation I helped to make pork pies for Northern Foods. I am not sure whether politicians should confess to making pork pies, but when students were making them, complaints from consumers went up—I hope that it was nothing to do with my skills.

As Members from both sides of the House addressed the substance of today’s debate, we heard about how they, and organisations in their constituencies, are playing a critical role in improving our country’s skills. The hon. Member for Milton Keynes South was quite right to talk about the Open university. As we debate higher education, the model of the Open university is one that people will want to replicate. I speak as a former student, now a fellow, of Birkbeck college, where part-time education is also key. We really need to engage in a more flexible approach to higher education, and the Open university has a lot to contribute in that respect.

We heard about the university of Southampton from the hon. Member for Romsey and Southampton North, and we also heard how a number of Members had been apprentices. We heard from the hon. Member for Liverpool, Walton (Steve Rotheram) about his time as an apprentice bricklayer. We heard from my hon. Friend the Member for Burnley (Gordon Birtwistle) about his apprenticeship as a textile machine manufacturer.

That is why this Government are so proud, in their very earliest days, to have put extra money into the apprenticeship scheme, and to have set a target of 50,000 new apprenticeships. The right hon. Member for Tottenham (Mr Lammy) seemed to jest—how could we be so bold as to want to create 50,000 new apprenticeships?—but we are very proud to have set that target. The right hon. Gentleman appears to consider it unachievable, but I can tell him that I have discussed it with my hon. Friend the Minister and with officials, and we are certain that we will meet it and do better as time goes on. I hope that in due course, when we have achieved our aim, he will pay this coalition Government the credit that they deserve.

[Mr Lammy]

I wonder whether the hon. Gentleman can tell us when we will see those 50,000 apprentices.

--- Later in debate ---

[Mr Davey]

What I have noticed about the targets set by the previous Government—which the right hon. Gentleman mentioned in his speech—is how often they were not met. The Government set target after target which they then failed to meet. The right hon. Gentleman spoke of the targets that they set for apprenticeships, but they set those targets and never met them. We will meet our target, and I believe that we will meet it within the next 12 months. I hope that the right hon. Gentleman will soon eat his words.

We heard an awful lot today about the importance of manufacturing industry. I believe that the Government’s skills programme will ensure that it receives the support that it deserves, at the basic skills and education level. Labour Members may complain about the state of manufacturing industry, but they have a poor record in that regard themselves. The hon. Member for West Bromwich West (Mr Bailey), the new Chair of the Business, Innovation and Skills Committee—I welcome him to his post—made a thoughtful speech on the subject, but I think he should bear in mind that whereas in 1997 manufacturing represented 20% of the United Kingdom economy, by the time the Labour Government left office the proportion had fallen to 12%.

[Mr Bailey]

Will the Minister not acknowledge that one of the reasons for that was the huge increase in the service sector? It did not reflect an absolute decline in manufacturing.

[Mr Davey]

Of course that is true of many modern economies, but I think it ill behoves the Labour party to criticise this Government in their early days, given that its own approach to manufacturing industry was not to turn the tide and go against the trend.

Although we have a huge amount in common, when Labour Members talk about the skills agenda they sometimes forget some of the record of which they should be less proud. I am thinking particularly of the quangocracy that grew up around the skills agenda. There is currently a patchwork quilt of quangos involved in that agenda. Members may be interested to learn how the position has changed. In government, the Labour party did not just create the existing quangos, but created quangos, abolished them and created new ones, all within 13 years. The fact that that instability and reinvention happened time after time shows that the Labour Government never really had a true vision. They constantly spent large amounts on new quangos while failing to get some of that money to the grass roots—to our communities. A lot of money was wasted then.

When the last Government set up the Learning and Skills Council, I was sent strategy after strategy by that august body. At first I thought that I had a real duty to read every single page, but when I visited the LSC and talked to its representatives, I realised that most of those strategies would never come to anything. I am afraid that that happened time and again. Huge amounts were spent on quangos, reports and consultancy, but less money went to the companies and learners who needed it. We believe that the need to rationalise the quangocracy in learning and skills is a key issue, and we will deal with it. We will do so while also having to look at the spending issues in this area, and there will be huge challenges. I do not think there is anyone in this House or involved in FE, HE or the education system in general who does not realise that we face difficult choices in this area, but we are absolutely clear that we will do our best with the money that we have got into apprenticeships and into the capital programme for FE to ensure that the priorities get the funding they deserve.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

As the hon. Gentleman has mentioned apprenticeships again, can he tell the House whether, in the 12 months he is talking about, if we take together what he and his colleagues are proposing on Train to Gain and apprenticeships, more learners will be funded by the Government or fewer?

[Mr Davey]

That is interesting. We have to compare that with what the previous Government were planning. When we looked at the funding issues facing us, and the very difficult choices, we saw that the previous Government were planning £340 million of cuts in adult further education and skills this year. That is actually happening this year, and I hope the colleges and students—and the employers—who are having to deal with the financial situation imposed by the cuts realise that the people who are to blame for that are sitting on the Opposition Benches.

[Mr Lammy]

rose—

[Mr Davey]

Before I let the right hon. Gentleman in, let me say that I hope that when he gets to his feet he admits to the House that it is under the previous Government’s plans that we are seeing a 3% reduction in funding rates for college-based provision, a 10% reduction for apprenticeships for those aged 25-year-old and over and a 6% reduction in other work-based learning. This is what we are having to deal with, and it is creating huge problems, as he ought to know.

[Mr Lammy]

It is the hon. Gentleman who is in government so I think he ought to answer the question put by my right hon. Friend the Member for Wolverhampton South East (Mr McFadden): will there be more or fewer learners as a result of the announcements made today? The House has a right to know.

[Mr Davey]

Well, one of the things the House needs to understand is that we have a different approach to FE and HE. We do not believe we can sit here in Whitehall and have a centralised system that we micromanage, and that we can then suddenly guarantee that there will be x new trainers, x new learners and x new places, as the right hon. Member for Tottenham and his friends used to do. That is why they failed so often: they took a centralised, top-down approach.

We will ensure that our approach is employer-led and learner-led. That is why we are working with businesses to make sure our schemes and proposals get the support that they will need from those areas. That is a very different approach. We know that, as we meet the challenges ahead of us, the private sector will have to be involved and be working with the Government. Far too often, the private sector was too much of an afterthought in how the right hon. Gentleman and his colleagues planned their skills agenda.

Change is inevitable and, as Dr Johnson said:

“Change is not made without inconvenience, even from worse to better.”

So there will be difficult choices. We will not shy away from them, but when we have to make those difficult decisions, it will be the employers and learners who are uppermost in our mind, not the bureaucrats and the quangos and the consultants, where all the money was wasted under the last Government.

We have had a constructive debate. I say on behalf of my hon. Friends and fellow Ministers in the Department that we are keen to listen, even to ideas from former Ministers who may at last realise that many mistakes were made and want to begin to confess. I hope that through working across parties and with the Select Committee and new Members, we can revitalise and invest in the skills our economy so desperately needs—