Industrial Strategy

Lord Aberdare Excerpts

Thursday 1st February 2024 Lords Chamber

[Lord Aberdare (CB)]

My Lords, I congratulate the noble Lord, Lord Watson, on obtaining this debate, and my new noble friend Lord Rosenfield on his excellent maiden speech.

I will talk about skills, which are central to the Government’s aims of becoming a science and technology superpower and leading the world in achieving net zero, and therefore central to industrial strategy. Digital skills are needed across the board, particularly as artificial intelligence grows ever more pervasive. Green skills are essential in the pursuit of net zero; creative skills are increasingly demanded by all sorts of employers, and are key to our success in the creative and cultural sectors; and the importance of technical skills is well presented by the new Technicians gallery at the Science Museum. The noble Lord, Lord Hague, pointed out in the Times last week that the current lack of craft and trade skills, including electricians, plumbers, bricklayers, plasterers and roofers, makes the target of building 300,000 new homes a year “at present ... a fantasy”, in his words. We also lack leadership and management skills.

Current skills policy seems far from being joined-up or comprehensive. What can the Minister tell us about progress in developing the nationwide local skills improvement plans required by the Skills and Post-16 Education Act 2022? Where in government does responsibility lie for ensuring that skills needs are fully addressed nationally and locally? Where is the big picture for skills strategy?

The recent report of the Lords Education for 11–16 Year Olds Committee, on which my noble friend Lord Mair and I served, emphasises the need for a better balance between academic and technical education in schools. The curriculum’s current overacademic bias fails to offer enough attractive technical or vocational pathways for the 50% of young people who do not aspire to university, especially the so-called forgotten third of pupils whose educational progress is stymied by not achieving pass grades in English and maths GCSEs. We should instead be opening their eyes to the wealth of opportunities for them to acquire the technical and practical skills that we so badly need.

Apprenticeships should also be central to any skills strategy, but the numbers of young apprentices aged between 16 and 25 are low and falling further. Employers almost universally complain that the apprenticeship levy is not flexible enough and that a significant proportion of levy funds is not being used to finance skills development at all, but reverts to the Treasury. Meanwhile, small employers are reluctant to take on apprentices because of the cost and bureaucratic complexity involved.

A culture change is needed to recognise the central importance of skills and to put in place appropriate policies across government to deliver the skills we need. No industrial strategy will work unless it includes development of the skills needed to deliver it. I hope the Minister tells us how the Government plan to address this key challenge for the achievement of their strategic industrial goals.