Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [Lords]

Judith Cummins Excerpts

2nd reading
Tuesday 25th February 2025 Commons Chamber

[Lauren Edwards (Rochester and Strood) (Lab)]

I do not support the amendment but will speak in favour of the Bill.

As many have highlighted, there is a gap between the skills needed by employers and the skills held by the UK workforce. Skills shortage vacancies have been on the rise year after year, and the latest data shows that a third of all vacancies are due to skills shortages. It is holding our country back and, therefore, the system needs to change. The immediate skills gaps need to be addressed urgently, but just as pressing is the need to have a single body that considers the skills that our businesses will need 10, 20 or 30 years from now, with 1.4 million new jobs predicted by 2035 alone. Many of those new jobs will need technical green skills, digital skills and understanding of artificial intelligence.

If our Government are to achieve the changes in this country that so many people voted for—more homes, green energy and economic growth that puts money back into people’s pockets—skills are the key ingredient. The importance of apprenticeships and technical qualifications to that mission cannot be underestimated. Indeed, I was immensely proud when the Prime Minister and the Education Secretary visited MidKent College in my constituency before the election to set out their ambition to put vocational education on the same footing as academic university education.

If Skills England is to achieve its aims and help us to meet the skills challenges our country faces, it must cover all areas. I therefore welcome the Bill, which folds IfATE into Skills England to enable that integrated approach to support our labour market and economy.

As others have mentioned, the Bill will make Skills England an Executive agency of the Department for Education. I am pleased that Ministers amended the Bill in the other place to require the Secretary of State to lay a report before Parliament detailing the exercise of functions conferred on her by the Bill. I understand that will also make clear the functions that Skills England will take on and the expected effects of those functions. I likewise welcome the commitment to publishing details of the framework that will be used to hold Skills England to account for its delivery and its relationship with employers. The clarity those documents will provide is most welcome.

I will also take this opportunity briefly to welcome the reforms announced by the Government during National Apprenticeship Week. The apprenticeship levy under the former Government, well meaning though it was, was too cumbersome and restrictive for too many employers and learners. As a result, apprenticeship starts fell off a cliff, and the latest data on apprenticeship completion shows a rate of just 55% in England. I am therefore pleased that the Government have listened to employers and training providers and committed to making the new growth and skills levy, which will replace the apprenticeship levy, simpler, more flexible and employer-led. I note that Skills England will be tasked with carrying out analysis of the broader types of training that will be eligible under the new levy and I look forward to seeing the outcome of that work, which will be hugely beneficial to employers and apprentices.

A common issue with the current apprenticeship schemes in this country, as others have mentioned, is that it does not work for small and medium-sized enterprises, which do not have large human resources departments to help navigate the often complex skills landscape. Nowhere is this more apparent than in my local authority area of Medway where 90% of all businesses are SMEs. Can the Minister set out how the Government will ensure that the voices of SMEs will be heard, so that we get an apprenticeship framework that works for all types of businesses? That is particularly important if we are to drive growth across all parts of the country. I know, for instance, that there are some larger businesses looking at how they can provide practical apprenticeship support to SMEs in their supply chain, so it would be good to know whether the Government are considering how they can best incentivise approaches such as this, which will help hugely by “de-risking” apprenticeships for SMEs.

Likewise, I know that there are some amazing smaller training providers. I have a fantastic women-led one in my constituency called Umbrella Training. It is equally important that these providers’ experiences and needs are reflected in the new apprenticeship system.

There are always risks associated with change; that is unavoidable. There is obviously some concern that the transfer of IfATE to Skills England may lead to a level of disruption, so it would be helpful if the Minister provided details of the main risks identified by her Department for the transition and how they will be managed and mitigated. Doing so would help to provide assurance to those currently undertaking apprenticeships and other technical qualifications, as well as to employers. It will be particularly important to ensure that the knowledge and expertise of staff at IfATE—no doubt built up over many years—is not lost during this process.

It will also be helpful for Skills England to set out a number of other issues in due course, such as what changes may be proposed to the local skills improvement plan framework, and assurance that local areas will be able to prioritise sectors or industries that are key to driving their local economy that may not feature in the Government’s industrial strategy, as mentioned by my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell) earlier in the debate. Anything further that the Minister can say on these points at this stage would be welcome.

Finally, clause 6 removes the requirement to review technical educational qualifications at regular intervals. Instead, the Secretary of State will have the flexibility to focus on reviews based on need. It would be helpful if, in her response, the Minister outlined what steps will be taken to ensure that the quality and relevance of qualifications is maintained under the new framework.

[Madam Deputy Speaker (Judith Cummins)]

Before I call the next speaker, may I gently remind Members that their speeches should be no longer than five minutes?

--- Later in debate ---

[Amanda Hack (North West Leicestershire) (Lab)]

I welcome the introduction of this Bill as a clear indication that we are giving apprenticeships the support and recognition they deserve. I started my professional career at a training and enterprise council—a TEC—and, once upon a time, I used to sign off training contracts for apprenticeships. It was always a pleasure to speak to young people at the start of their future, so I know at first hand how needed the Bill is for the FE sector, employers and young people, and it is incredibly exciting to have this back on the agenda.

For the last 14 years, there has simply been no strategic direction. The partnership between Jobcentre Plus, FE colleges, employers and the workforce has been slowly eroded, and it is clear that we need a reset. The one in eight young people currently not in training, education or employment need that reset, and apprenticeships are a part of that agenda. This Bill paves the way for the establishment of Skills England, giving it the tools to perform its new role and delivering on our commitment to assess and address the existing skills gap and identify where training can be utilised for new growth.

Since the apprenticeship levy was first introduced by the Conservatives in 2017, we have had a decline in the growth of training in all areas where we actually need it. The new growth and skills levy being introduced will replace the old system and include a new foundation apprenticeship that gives young people a route to careers in critical sectors, enabling them to earn a wage while developing their skills. It will also allow funding for shorter apprenticeships, giving learners and employers greater flexibility over their training than under the existing system. I have honestly lost count of the amount of employers who have asked for changes to the apprenticeship levy, and, under Labour, we will deliver.

We are clear about our strategy and that it must be cross-departmental. We are already opening homebuilding skills hubs to deliver fast-track training to apprentices so that we can meet our target of 1.5 million new homes being built. It is clear that Labour has done this before, and we will do it again. More than two decades ago, the regional development agencies understood the challenges in their regions and funded training for sectors where there were skills shortages. I was proud of the very small role I played in setting up a construction academy and providing a boost to HGV driver training in partnership with leaders in FE, the private sector and local authorities, all funded by the East Midlands Development Agency.

Stephenson College in my constituency is a key organisation locally that serves my community. It has a strong role as an anchor organisation, and we should not forget that. It has fantastic facilities for learning and has created an environment for young people to grow and thrive, but it has not been easy. Like so many FE colleges, it has been put under huge financial pressure in recent years. We have to ensure that our colleges are financially sustainable in the long term, and I welcome the recent additional funding for the sector while recognising that there is so much more to do.

There is also a role for Skills England to support constituencies in areas that do not yet have devolved powers. My constituency of North West Leicestershire does not have a devolution deal, but we have just as much potential to grow as everywhere else, and key engagement with local authorities, the chambers of commerce and local employers, as well as the FE and HE sector, will be key in delivering that growth.

Within our approach, we must ensure that we are putting a lot of thought into how regions can work together, so that if we move across boundary lines, we are still met with the same funding and unconditional support. We will drive that ambition as a Government to meet our targets—to go bigger and better than before, ensuring that our legislation has the greatest impact possible. I look forward to the continued conversations on the shaping of Skills England, enabling our young people to develop the skills they need for the future.

[Madam Deputy Speaker (Judith Cummins)]

I call the shadow Minister.