Education Bill

Lord Young of Norwood Green Excerpts

Wednesday 14th September 2011 Grand Committee

Moved by

[Lord Young of Norwood Green]

144AA: Clause 67, page 53, line 11, at end insert—
“(13) In addition to the above, the Secretary of State will make available the apprenticeship offer and will ensure that progress is made to ensure the offer is available to all qualified persons by 2015.”

[Lord Young of Norwood Green]

My Lords, I shall speak also to Amendments 144AB and 144AC, and give an indication of my view on Amendment 144B in the name of my noble friend Lord Layard.

I felt that the importance of Amendment 144AA was underlined by today’s unemployment figures. UK unemployment rose by 80,000 to 2.51 million jobless, a rate of 7.9 per cent. The bit that caught my attention more than anything else, because it is germane to today’s debate, was that youth unemployment rose sharply by another 78,000 to 973,000 unemployed young people. It was interesting also that public sector employment fell by 110,000, partially offset by a 41,000 increase in the private sector. I mention that because the public sector is an area where we look to a significant number of apprenticeships, so the impact of that is likely to feed through.

I shall mention our record on apprenticeships when we were the Government. I have said this before and make no apologies for repeating it: if apprenticeships had been a national health patient, they definitely would have been in intensive care. We had only about 65,000 of them and an appalling completion rate of something like 27 per cent. By the time we left office in 2010, there were nearly 280,000 apprenticeships, with a completion rate of 72 per cent. I am proud of that; it was a good record. Was the task completed? Clearly, it was not. But we had set a target in the Apprenticeships, Skills, Children and Learning Act. We gave a commitment that by 2013 every person who wanted an apprenticeship would be able to have one, assuming that they had the requisite qualifications. We felt that that was a very important, albeit ambitious, commitment.

I want to pay tribute to the Government's commitment. The good news is that funding is being made available to support 437,000 apprenticeships in 2011-12, including 230,000 for 16 to 18 year-olds. I welcome that; it shows commitment. Further still, the Government are talking about 497,000 apprenticeships for 2012 and the funding to go with them, so I acknowledge that they are treating this issue as one of importance. The real question is: are they doing enough? The purpose of my amendment is to stretch that commitment. I make no apologies for that in the current climate.

Looking at what is being achieved at the moment, the figures for August 2010 to 2011 make interesting reading. The worrying area of the figures, for me, is that in the 16 to 18 year-old group we see an actual decline in the number of starts. For 16 year-olds in 2009-10, there were 29,000 starts but so far in 2010-11, in quarters one to three, there are only 24,690. That is reflected in the figures for 17 year-olds, with 40,780 starts in 2009-10 and 34,500 in 2010-11. Similarly, with 18 year-olds, we see a decline from just over 46,000 starts to 43,000. I must admit that the 19 to 24 age group shows a healthy increase from 113,000 starts to 102,000, which I acknowledge is good progress.

The really startling increase has been in adult apprenticeships. A significant number in that was accounted for by switching people who were previously on Train to Gain to adult apprenticeships. Again, I do not deplore that. There is a need for people to reskill, but surely the major area of concern for us should be in the 16 to 18 age group. We know how important that is. I do not want to draw any glib analysis from the riots that have taken place recently, because somebody else will be looking at that, but youth unemployment certainly does not help the situation. For every young person who you can offer an apprenticeship to, we know that that is a beacon of hope for them, as I have described it. We know that many young people have turned their lives around by starting apprenticeships, which is why we attach so much importance to that particular group of young people. While the overall figures may look good, when they are disaggregated there are definite causes for concern.

Another bit that worried me was when I sought to look at what the Government’s targets were. It was quite interesting because John Hayes, the Minister for Further Education, Skills and Lifelong Learning, has explained:

“The apprenticeships programme is a demand-led programme for young people and adults. Government funds apprenticeship training but relies on employers and providers to work together to offer sufficient opportunities. Therefore, Government do not plan apprenticeship places or set targets”.—[Official Report, Commons, 4/3/11; col. 708W.]

I find that a rather curious statement. Therefore, I would welcome the Minister confirming whether it is true. If it is true, how do the Government arrive at the funding figures because presumably they relate to something? Presumably, somebody has decided that that is the funding we need for a certain number of places. As I say, I find the statement to which I have referred rather strange. Perhaps it has been taken out of context, but I hope not as I obtained the statement from what I hope is an unbiased source; namely, the House of Lords research department. I just asked for a statement of government policy.

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[Lord Young of Norwood Green]

My Lords, I was trying to establish that I believe that this commitment on entitlement one by 2015 could be achieved. In the current circumstances, given the level of youth unemployment, it is something that we ought to go for. The Government should be sending a signal to the young generation that we are absolutely committed to ensuring that there will be an apprenticeship available, as was offered in the previous entitlement in the 2009 Act.

I talked about the small number of employers that are engaged. How can we improve on that? We started down a road which I think had lots of unexplored potential. There is the question of involving SMEs, especially smaller companies. If you talk to them, as I do whenever I meet them, you will understand that they worry about administration, costs and so on. If they have not been involved with apprenticeships before, they see them as a voyage into the unknown and cannot necessarily see the benefits.

Yet we have a brilliant scheme which has been around for some while now: group training associations. Significant numbers of small and medium-sized employers gather under that umbrella where a lot of administration and basic training takes place and when young people have achieved a reasonable level of expertise, they go out to companies. Once again, the Government have committed themselves on group training associations, but I do not feel that there is enough drive to ensure that we are maximising the opportunities available in them. If there were a really intensive drive on group training associations and ATAs, I think we could be confident that we could get more SMEs involved, which we desperately need to do.

The interesting thing about apprenticeships and demand is that I recall that when I was a young lad of 17 years old, I wandered down the road, rang the doorbell at Telephone House and managed to get a telecom apprenticeship. If a young person tried to get an apprenticeship with BT today, I do not think he would have that success. BT offers about 300 apprenticeships and is oversubscribed by something like 25,000. The demand is huge. Somebody said that it is harder to get an apprenticeship with BT than it is to get into Oxford or Cambridge. There is huge, unsatisfied demand, and we have got to make sure that we engage employers.

I am also speaking to Amendment 144AB, which is a key part of the Government’s commitment. We made it clear that part of the condition of offering government procurement contracts was that there should be a commitment from employers to provide apprenticeships. We had significant success. I shall quote two large-scale contracts. They could have been better, but there were something like 300 apprenticeships on the Olympics and Crossrail has offered 400, so it can be done. Surely it is wrong in this day and age that we should be awarding government contracts to companies that have no—

[The Deputy Chairman of Committees]

My Lords, I apologise, but there is a further Division in the Chamber. Therefore, we stand adjourned for 10 minutes until 7.16 pm.

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[Lord Young of Norwood Green]

My Lords, I shall round up as speedily as I can on the final couple of aspects of these amendments. I talked about the importance of procurement. Again, the Government have not seen fit to make apprenticeships a condition of government procurement contracts. I would welcome some reassurance on that. There is also the important question of government departments demonstrating that they do not just talk about the value of apprenticeships but actually recruit apprentices themselves. The latest figures show that 2,120 apprenticeships were started in government departments. From my brief experience as a Minister, I would say that this is an area where we cannot afford to take our eye off the ball. Making sure that government departments are held to account on a regular basis is vital. In current circumstances, when jobs are going but where nevertheless there is a commitment in government departments to apprenticeships—we can see from the figures that they are still going—we cannot afford to be complacent.

In answer to a parliamentary Question, the Minister for Further Education, John Hayes, said that no data were available on how many apprenticeships government departments were planning over the next three years, but that,

“Civil Service Learning is encouraging Departments to use apprenticeships to support delivery of their business objectives and will provide some central support to promote a more consistent approach”.—[Official Report, Commons, 19/7/11; col. 978W.]

That is not good enough if we are serious about trying to ensure that the maximum number of apprenticeships are available to meet the entitlement.

Another area where we could give a good signal relates to Amendment 144AC, in which I refer to Investors in People. I was surprised, when I went to a presentation for a company that had won an award for best employer that year, that when I spoke to the CEO of the company, he said that they did not have any apprenticeships at all. I looked at the Investors in People website and could not find any requirement in it. There is talk about selection and recruitment being fair, but I could not find any explicit reference to that requirement.

I believe that the target year I have suggested—2015—is reasonable and achievable. It will take a significant effort by the Government, but in the current circumstances, given the importance of apprenticeships to young people and the figures for youth unemployment, it is surely a signal that this Government should give, and I commend the amendment to the Committee.

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[Lord Henley]

I am very grateful to my noble friend for putting it in those terms. That makes it even more important that he talks to the department and to my honourable friend and tries to secure some sort of agreement. We now have a reasonable amount of time. I know the noble Lord will be heading off to wherever the Liberal Democrats hold their conference but, in due course, he will be back and then discussions can take place in the appropriate manner.

I want to deal with a couple of other points. First, the noble Lord, Lord Low of Dalston, raised a question concerning people with disabilities and the offer. I can confirm that disabled people aged 19 to 24 are covered by the offer and that that group will be prescribed in regulations. There is also the commitment given by the previous Government during the passage of the ASCLA—as we now seem to call it—to take on an inclusive approach. They are also being advised on this by external disability experts. No doubt we will be able to let the noble Lord know a little more in due course.

Finally, my noble friend Lady Sharp of Guildford asked about the response to the Wolf report on incentives to employers. We accepted that recommendation in the Wolf report. The National Apprenticeship Service has recently run pilots looking at incentive payments and we need to consider these and other research into employer payments to ensure that we avoid dead weight when implementing this recommendation. That is work in progress.

Before my voice finally gives out, I say that we are all travelling in roughly the same direction. We might be going at different speeds and there might be tensions in how we do it, but I believe that much more can be done through further discussions. I believe that we are all committed to the same outcome, which is seeing increasing numbers of apprentices across both public and private sectors and increasing employer participation in the programme. With those assurances, I hope that all noble Lords who have put forward their amendments and spoken to them so eloquently will feel able to withdraw them and, where appropriate, I hope that conversations can continue between now and Report.

[Lord Young of Norwood Green]

Perhaps I may make a few brief comments in relation to what has been said. I support the intentions of my noble friend Lord Layard in his amendment. I would like it to go a bit further but we are all travelling in the same direction. I was not exactly sure what the noble Lord, Lord Wakeham, meant when he said I had gone off key in the latter part of what I said, but I agree with him on his point about literacy and numeracy skills. Interestingly, if you can get young people involved in the apprenticeship process, it refocuses them on the importance of learning. I share the concern of the noble Lord, Lord Addington, and I would want to do everything I can to assist in that process. We discussed a whole range of disabilities, as the noble Lord, Lord Low, will testify—he always makes sure that we do. I thought we reached some useful agreements. I am glad that the incentive to employers was answered and I thank the noble Baroness, Lady Sharp, for her support, and likewise my noble friend Lord Monks.

On the status of apprenticeships, I agree with the noble Lord, Lord Storey. One thing that we got slightly wrong was that, by focusing on getting 50 per cent of young people to go to university, we gave the impression that the vocational route was a second-class route. We need to do a lot more on that. Gradually, the tide is turning. On a lot of apprenticeship schemes, when the apprentices complete their training there is a graduation ceremony. We need to do more on this.

The noble Lord, Lord Henley, referred to targets. Whether or not we delete “target” and insert “planning assumption”, we will still have to make calculations. Before the Government say that the 2015 commitment is not the right approach, it would be interesting to see the planning assumption for what the demand would be. I say that it could be done, and that it is absolutely the right signal that should be sent to young people and to the country.

The noble Lord said that he preferred a voluntary approach when it came to contracts, and that apprenticeships would place an additional burden. I wish that he would not use that term. Apprenticeships are not a burden on companies. They think that they are, but when they take on apprentices they frequently realise what a good investment they are. I do not see them as a burden. When we worked with the Olympic committee and Crossrail, we found that they understood the value of apprenticeships. The Government should take a long, hard look at making them a key part of government procurement contracts. I do not believe that it would disadvantage SMEs, but I will not go over the debate again. With IiPs, what disturbed me was that again there was no reference to apprenticeships. If we are to say that these companies invest in people, surely apprenticeships ought to be part of the investment. I do not know how we should go about it, but something should be done.

I will of course withdraw the amendment, because that is how we operate in Grand Committee. However, we will return to these issues on Report. I welcome the offer of further discussions because I, too, want to make progress. I thank the Minister, John Hayes, for our previous discussion. It was a worthwhile exchange of views. With those comments and caveats, I beg leave to withdraw the amendment.

Amendment 144AA withdrawn.