Technical and Further Education Bill

Lord Baker of Dorking Excerpts

2nd reading (Hansard): House of Lords
Wednesday 1st February 2017 Lords Chamber

[Lord Baker of Dorking (Con)]

My Lords, I welcome the Bill. It was very gratifying to hear from the noble Lords, Lord Watson of Invergowrie and Lord Storey, that there is agreement on all sides of the House that we want a better apprenticeship system.

Any assessment of an apprenticeship system and further education should really start from an assessment of what the skills gap is. I was rather surprised that the Government’s industrial strategy document never attempted to estimate the size of that gap because, if we do not have skilled workers, it will not matter what industrial strategy we adopt. It simply will not be fulfilled.

Distressingly, the gap is growing greater year by year. In 2016, a CBI survey revealed that 69% of its members were,

“concerned about not being able to fill highly-skilled”,

jobs. That had gone up from 55% in 2015, so within a year it rose quite dramatically. None of us were really aware of this being one of the problems in the skills area. Another report says that in construction in 2016, employers were,

“struggling to fill one in … three”,

places for skilled vacancies, which had increased from one in four in 2013.

Those vacancies were at the skilled labouring end of the skills gap but if you start at the top end with STEM graduates, the gap is even greater. The Royal Academy of Engineering forecast three years ago that we would need an extra 45,000 STEM graduates each year up until 2020 and we are just not meeting that. This year in Davos, the number of STEM graduates around the world was estimated and there was an interesting circular diagram, which showed that two-thirds of STEM graduates today come from two countries in the world: India and China. That is a clear indication of where the wealth of the world is going to go over the next 20 or 30 years. America came a distant third and I barely found where we were; we were a statistical blip. We were barely there on STEM graduates. The Government clearly must, first, improve the teaching of maths dramatically in our country because unless they do we will not get an increase in STEM graduates. I know that they have various proposals to do that but the importance of this cannot be exaggerated.

It is not only in mathematics. A report from the House of Commons last year stated that the shortage of skilled digital technicians was 745,000. When I went to see the chief executive of John Lewis, Charlie Mayfield, I wanted to speak about food technology because the university technical colleges doing that subject knew nothing about it. He was not very interested in that. He said that his big problem was that he could not recruit enough computer scientists to run his business, which is hugely logistical and requires very sophisticated computer skills. He could not get them from the English educational system.

Estonia’s largest export is in fact computer scientists. Estonia is able to do that because it has had coding in schools for about 20 years. We are starting coding in primary schools this year, and it is done very patchily. The teachers obviously cannot teach it and have to get other people in to do it. There should be coding in every school. Every secondary school should have computing as a compulsory subject at GCSE but we do not have that and, as a result, when it came to the GCSE subjects last July 300,000 took a foreign language and only 60,000 took computing. I believe it is more important for students to understand a computer language than to pick up the smatterings of a foreign language. We are on the absolute threshold and dawn of a digital age and youngsters must have that ability.

To see how far we are from America, I say that the chief executive of Microsoft is an Indian, Satya Nadella, who decided to set up a team to develop artificial intelligence and build a new operating system. The team that he set up had 5,000 computer engineers. We simply could not do that in Britain; frankly, it could not even be done in Europe. There is a huge need for investment in computing and digital skills, which are all part of the later stages of apprenticeship.

I certainly welcome the creation of the Institute for Apprenticeships, which could become a powerful body. By the way, I am very impressed by the quality of the first eight directors and I congratulate the Government on that. They are an impressive bunch of people and I know a couple of them, who are independent people with great experience. I am thinking in particular of Toby Peyton-Jones, the HR director of Siemens. He is a trustee of one of my educational charities and has great knowledge of apprenticeships and the needs of British industry.

The institute could become not just an administrative body, although it will have an administrative function. It will look at apprenticeships around the country. It will try to weed out the ones that are not very good or are weak. It will look at the range of technical qualifications, try to get some sense into it and eliminate those that are not necessary. That is the administrative job, but I think the institute should also have a policy job. It should have a policy overview of the whole system and report to this House and the other place once a year, on not just its administrative functions but on its reflections on the whole system and how effective it is. This means that the Government will have much less influence over the policy. The Government are not funding apprenticeships. Industry is funding apprenticeships, so the Government should keep their hands off a little bit and leave them to the experts in the area. I certainly welcome that role.

I have some comments on the age for apprenticeships. I would welcome a return to what the Labour Government had: apprenticeships for 14 year-olds. The coalition Government stopped them, and that was a mistake. In the university technical college movement, we have discovered that at 14 youngsters are quite able to realise where their talents and interests lie and what subjects they would like to study. There are lots of 13 and 14 year-olds at school who are very fed up with the range of subjects they are studying. They become very disengaged and would like the opportunity to become youthful apprentices. I believe in the future. This is not a decision for the Minister. If I were to move an amendment and the Minister were to say, “The Government do not approve”, I hope he realises that it is not for the Government to approve. It is for the institute to decide this matter in future. If it decides on this, it should be done, and I would welcome that.

During the Industrial Revolution nearly all the great inventors started an apprenticeship at 14. James Watt started an apprenticeship at 14 as an instrument maker. Josiah Wedgwood was bound to his brother for five years as a master potter. He had very interesting conditions in his indenture, which I am not recommending should be put into apprenticeships for 14 year-olds. It said that:

“At Cards, Dice or any unlawful Games he shall not Play,


Taverns or Ale Houses he shall not haunt or frequent

Fornication he shall not commit—

Matrimony he shall not Contract”.

Those articles produced a very great man, but if we tried it today we would not reach 3 million apprentices by the time of the next election. I certainly favour apprenticeships for 14 year-olds.

The real test of the apprenticeship movement is how many people become apprentices at 16 or 18. The record is not very good. Last year, the number of 16 year-olds went down. The House may know that in 2015 there were 500,000 apprenticeships, but only 5,000 were at 16 to 18 studying at level 3 or above. This is the point made by the noble Baroness about levels 4, 5 and 6. Level 4 is diploma level, level 5 is foundation degree level and level 6 is an honours degree. That is where the skills gap is, not at level 2. It is essentially at levels 4, 5 and 6. Only around 5,000 of 500,000 apprentices were doing that at 18, which is 1.04%. I am very proud that university technical colleges provide a great deal of those apprentices. At 18, our youngsters are eligible to be higher apprentices because they have an academic subject, such as an A-level in maths, physics or life sciences, and a technical subject, such as a BTEC extended diploma. They are therefore highly employable. Many of them become higher apprentices. In the bigger companies, they earn salaries of £15,000 to £20,000 a year and they usually study for a foundation degree. The Royal Navy, which has adopted UTCs, is desperately short of technicians and engineers and cannot currently man aircraft carriers. It introduced 18 higher apprenticeship places last September, 130 people applied, and 16 of those places went to UTC candidates. It was offering a salary, by the way, of £28,500 for hired apprentices. These are the apprenticeships which are definitely worth having and which we must encourage. I believe quite a lot of apprenticeships go to older workers in their 20s and 30s, who are already employed. I do not believe those should be called apprentices, as it is really adult training and retraining. I am not against that—there should be a lot of it—but to give them the name of apprenticeships is completely wrong.

There is much to be done, although I support the Bill, as I say. I intend to move one amendment which will improve the Bill enormously, in my view, dealing with career advice. How are you to get knowledge of apprenticeships over to youngsters? You cannot expect the schools to tell them, because teachers leave their schools, go to teacher training colleges and then straight into teaching. They have no experience of government, industry and commerce, or of apprenticeships. I will move an amendment which will allow the providers of apprenticeships, along with the heads of university technical colleges, studio schools and FE colleges, to go into schools at 13, 16 and 18 to explain to the students what they can then study—the alternative offerings. Career advice in our country generally is quite appalling.

I am glad to say that the amendment has the support of the noble Lord, Lord Adonis, the noble Baroness, Lady Morris, and the noble Lord, Lord Storey, from the Liberal Democrats, as well as of several Conservative Members, so I expect it to pass. I hope the Minister is listening—I think some days he is very favourable to the idea, but I can assure him that it will pass and will improve the knowledge available to many young people in our schools. We simply have to improve technical education in our country, as we are not doing it very well at the moment. The whole education system concentrates on academic subjects, whereas jobs, based on employability, go to those who have technical skills. Apprenticeships are part of that, but not the only part.