(12 years, 10 months ago)
Commons Chamber14. What steps he is taking to support manufacturing.
As part of rebalancing the British economy, we are taking steps to support manufacturing in the UK by encouraging high levels of business, innovation, investment, exports and technical skills. I set out our strategy for achieving that in a talk to Policy Exchange yesterday.
From recent discussions with several representatives of our largest manufacturing companies, it is apparent that they are now looking actively to bring more UK supply manufacture back to our country, but they seem to question whether some of our small and medium-sized enterprises have sufficient capacity or investment to meet the growth in demand in this area. What can the Government do to help facilitate the right conditions to help some of our SMEs meet this increasing demand?
The hon. Gentleman is right to say that there is a supply chain issue. We are hearing good news from the automobile and aerospace sectors, with the large primes, such as Tata, Rolls-Royce and Airbus, making large investments. However, we also need to attract back the supply chains, which is already happening, particularly in the car industry. We have bodies that co-operate with industry in both those sectors: the Minister of State, Department for Business, Innovation and Skills, my hon. Friend the Member for Hertford and Stortford (Mr Prisk) chairs one of them and I chair the other. We are therefore working actively with industry to attract the supply chains back to the UK.
No, I cannot confirm that, but I will speak to my colleague at the Department for Culture, Media and Sport about the impact on the art market, and how we propose to proceed with that in the European Union.
The success of apprenticeships is undoubtedly vital to future prosperity in areas such as the west midlands. Will my hon. Friend update the House on the progress of the apprenticeship programme in the west midlands region?
I described this as a rosy day for Britain, and it is a rosy day for the west midlands too. The number of apprenticeship starts in the west midlands is up by more than a half on 2009-10, which is due in part to the advocacy of excellent Members of Parliament such as my hon. Friend.
(12 years, 10 months ago)
Commons ChamberI have already had meetings with the Royal National Institute for Deaf People on the subject of signing, and, as I said, I am happy to meet the hon. Member for Wells (Tessa Munt) on the subject. However, I am not absolutely sure that treating BSL as a foreign language, as the original question suggested, is the best way forward. BSL is a preferred language of many deaf people in the UK, rather than a language of a different nation or culture. Some good qualifications are already in place, but I take the point that we need to examine whether they are effective in achieving the kind of results for deaf children that they deserve so that they can fulfil their potential.
14. What steps he is taking to encourage links between schools and employers; and if he will make a statement.
Increasing schools’ autonomy is central to our mission. Of course the Government take business very seriously and understand the importance of the relationship between business and education. It is therefore absolutely right that local businesses cement links with schools. It is not for me to dictate what those links should be; that will depend on local circumstances. Organisations such as the chambers of commerce and the Federation of Small Businesses, in which my hon. Friend plays a distinguished part, are best placed to make those judgments.
I thank the Minister for his response. Over the past seven years, we have seen a trend of rising youth unemployment, and we are now also starting to see a real skills gap in engineering and manufacturing. Does my hon. Friend agree that if we are truly to rebalance our economy and reduce youth unemployment, we must, in partnership with our world-class manufacturing companies, put in place a strategy to energise and promote the future of engineering and manufacturing within our schools?
As ever, my hon. Friend makes a point that is both salient and persuasive. The Government need no persuading, however, that STEM—science, technology, engineering and maths—matters. Indeed, my right hon. Friend the Secretary of State spoke earlier of our work with university technical colleges, which were originally devised by Rab Butler, a great Education Secretary, and driven by the noble Lord Baker, who was another. We have delivering that policy a third great Education Secretary in the making, who is sitting next to me.
(13 years, 1 month ago)
Commons ChamberT9. Over recent weeks, I have seen many parents in my constituency surgery who are extremely unhappy because they could not get their sons and daughters into the schools of their choice. What can my right hon. Friend do to end this school place lottery and get more good school places in my constituency?
My hon. Friend raises a good point, which is a major concern of this Government. More than one in six parents have children who are not offered a place at their preferred school. That has led to 85,000 appeals. We are reviewing the admissions process, which is far too complex to understand and administer. One of the proposals is to allow good schools to raise the pupil admissions number. We have had a very good response to the consultation so far and will announce our response in due course.
(13 years, 2 months ago)
Westminster HallWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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It is a matter of concern, particularly when I visit manufacturing businesses in my constituency, that the employees have an average age between 45 and 60. Is that not a worry?
I agree. That was to be my next point. A company in Burnley called Aircelle makes thrust reversers for the Trent jet engine. Three years ago the company employed 350 people; it now employs 800 people and has work for 15 years. Aircelle has been offered work from Boeing and other aircraft manufacturers, but has to turn it away because it does not have the skills.
I used to work for the company when it was called Lucas Aerospace, which was a long, long while ago. I walked around the place, and I said to the managing director, “I look at some of the people here and I remember them working here when I did, and I’ve been retired for three years. Some of these guys must be coming up for retirement.” He replied, “The age profile is a big concern because more than 80% of the work force is 40-plus.”
Another big problem for the company is that young people coming into the industry want to be designers and technicians, working on computers on the other side, and the guys who put the aircraft engine parts together are in short supply. It is a problem getting skilled fitters and process workers to come and do the job. The company is now a world leader in composites, but it is very difficult to get people to come and work on composite design and manufacture. Fortunately, it is using a lot of young ladies to do that now; because of the dexterity of their fingers, they are able to mould things in carbon fibre. I agree entirely that this is an issue that the Government must pick up. We must ensure not only that we train people to do the real top jobs but that we train young people to come in and do the jobs that involve physically making things.
As I said, at Burnley college we are having a manufacturing summit on 20 June. The council there has worked with the college. We spent £100,000 from the working neighbourhoods fund, and three years ago the college put in a further £100,000 to buy three Mazak advanced machine tools. The hon. Member for Worcester (Mr Walker) will know of Mazak because the company is based in his constituency. The college ran an engineering course but could not get anyone to go on it, but as soon as we put in the Mazak machine tools the course was overwhelmed, because young people see that they can work in an office and a workshop and design a product, go on a computer and feed the design into the machine, and then make the product on the new CNC—computer numerical control—machine. They can see that it is a great job for the future. The days of what I call the garage on “Coronation Street” with engineers in blue overalls with oily rags in their pockets have long gone.
Thank you, Mr Davies, for allowing me to make what I hope will be a short but important contribution.
I congratulate my hon. Friend the Member for Gloucester (Richard Graham) on securing this extremely important debate. He has made a positive, well-thought-out and comprehensive contribution, which goes to show just how much he cares—as, it seems, do a number of Government Members—about this extremely important subject.
I also want to take this opportunity—I do not often do this in my contributions to debates—to congratulate the Government, and particularly the Minister, on grasping the nettle and backing apprenticeships in this country. It will be an absolute honour to welcome him next week to the excellent North Warwickshire and Hinckley college in Nuneaton, where I am sure he will promote apprenticeships with the same vigour and enthusiasm with which he promotes them in the House. I am proud of that.
I am proud to support apprenticeships, because it is apparent that they are extremely important. Some 80% of people who employ apprentices say that the workplace is a more productive place as a consequence, and 81% of consumers favour using a company that employs apprentices. People of all ages understand the concept of an apprenticeship and, importantly, it is an excellent vehicle for getting young people into a proper career.
Bearing in mind the importance of tackling the huge problem of youth unemployment in our country at the moment, I will focus my comments on younger people. It is a real pity that that problem was not properly recognised by the previous Government, who presided over a huge increase in youth unemployment and a huge increase in the influx of foreign labour, which filled the skills void that we had when the economy was in better shape, leaving thousands of our young people on the scrap heap. I commend the shadow Minister for his attendance here today, but it is a damning indictment of the lack of seriousness and enthusiasm on the part of Opposition Members that none of them, apart from him, is here today.
While extolling the virtues of apprenticeships we must also acknowledge that not all is totally well in the proverbial rose garden. A large rump of employers in our country consider apprenticeships inappropriate for their organisations. I have been looking into that and, according to the Chartered Institute of Personnel and Development, 68% of companies say that that is the case. In some instances, those companies may be correct, and there are a number of situations in which it is wholly inappropriate for businesses to employ apprentices. However, I suspect that in many others instances that is not the case, and that there are many situations in which apprentices could be taken on. Employers and business people view most things on the basis of risk, and they take a view looking at the particular risks of taking on younger people and at the barriers to employing apprentices and to developing their talent.
I want to highlight two issues in relation to risk. First, employers see a risk in taking on a young person who is untried and untested in the workplace. As Members of this House, we need to acknowledge that although many young people take to the working environment like a duck to water, many do not, as my hon. Friend the Member for Gloucester has mentioned.
My hon. Friend is making a series of powerful points. On young people not being ready to take up apprenticeships in small businesses, it is important that we consider the potential role of the voluntary sector. For example, the YMCA and other organisations enable young people to develop skills before they take up apprenticeships, which is an important part of the mix.
As usual, my hon. Friend has made a pertinent comment, which brings me on to my next point. Useful work experience can be obtained in voluntary organisations. Similarly, I am a firm believer in part-time work, in which I was active in my younger days, particularly when I was at school and college. Part-time work is invaluable to young people in developing soft skills—my hon. Friend the Member for Gloucester mentioned that earlier—and in relation to integrating into and learning about the workplace environment, which, to be perfectly frank, is completely different from a school or college environment. Young people going into a workplace are not dealing with teachers or their peers; all of a sudden, they are working with people who have been involved in the industry for many years and are not accustomed to somebody fresh and green from a school environment.
We must acknowledge that opportunities for part-time work for our young people, although important, are extremely limited. Although I acknowledge that we must do all that we can to keep our young people safe and ensure that they are not exploited in any way, we must consider the regulations that many employers face when employing youngsters part-time, which go far beyond health and safety. I received a useful briefing on employing children from the House of Commons Library, and I was astounded by the number of regulations that it contained. I would be surprised if many employers knew those regulations. If they did, it would frighten them to death to take on any young person part-time.
For example, the document states that young people may not deliver milk or work in a butcher shop. When I was that age, many of my peers did such work. I delivered milk with the Co-op milkman—I am not sure whether the milkman should have allowed me to deliver milk with him, but I went out and delivered it all the same. Many of my peers at school used to work for one of the local butchers part-time, and they gained invaluable experience. If we are to enable our youngsters to gain such invaluable experience now, we must ensure that we look carefully at the regulations to ensure that we put barriers in the way only when absolutely necessary. We must also consider removing a great deal of the bureaucracy, including what appears to be a draconian reporting culture, that employers must undertake. Does the Minister think that it is a healthy position effectively to bar youngsters from taking on many part-time jobs? Does he not agree that we should free up regulations in a sensible way?
I had occasion a couple of years ago to question some young people about what they wanted to do when they finished school. One of them said that he wanted to be a benefit claimant. Does the hon. Gentleman think that working part-time for somebody might take that idea out of that boy’s head and help him change his view, so that he wanted to go into work rather than being a benefit claimant for the rest of his life?
I totally agree. That is part of the problem, which my hon. Friend has highlighted. There is a culture in certain parts of this country in which work is frowned upon. I am glad to say that we now have a Government who want to get this country and our young people working and create a culture of work, rather than one in which being kept—staying at home and collecting benefits—is a job choice, not a safety net.
That brings me to the other risk that employers in my constituency tell me about, which concerns employee retention after several years have been spent training a young apprentice. Obviously, the costs of that training are borne by the Government, in the main, but there are also costs to the employer in training people on the job. Employers are concerned that a young person will come in, serve an apprenticeship and leave. In certain trades, including the craft trades such as bricklaying, plumbing and so on, people can quickly set up as self-employed workers, and employers are concerned that they will invest their time and money in training young people who will either get a job elsewhere or set up on their own. We must address that, whether through an incentive scheme for employers or by other means. We must do all that we can to encourage employers to take people on and overcome those risks.
We need to consider the barriers to career progression that make things more difficult for employers, particularly those who have younger employees. That was highlighted to me on a visit to MES Systems in my constituency, which has two fantastic young apprentices whom I met. One of the apprentices had just finished his time and had qualified as an installer of security equipment, but unfortunately that young man will have to spend this coming year working for somebody else, not because he cannot do the job independently but because the company could not get insurance on the van that he needed to drive to get around independently. That is a major impediment not only for the young person who is not getting the experience of working independently but for the employer, who knows that additional work is available but is hamstrung by the fact that that he cannot send a person out to do that work, allowing him to take on another apprentice. That is the type of barrier that we need to think carefully about.
To touch on another constituency scenario, I spoke to the principal of a firm of accountants several weeks ago. The Minister will be glad to hear that he is looking to take on four apprentices as trainee accountants, but I am sad to report that to date, he cannot fill those vacancies, which is a sad indictment of careers advice and the link between employers, schools and FE colleges. It is important for the Government to tackle that issue. I hope that the all-age careers service will help with the quality of advice that our young people get, so that they can have proper careers and receive independent advice based on getting a job rather than on trying to meet exam targets or school or college league table targets. To many youngsters, that is important, but to some it is not as important as getting straight into employment.
There has been pressure on young people in recent years to go to university. I have teenage boys who are very motivated to go to university, because that is what their peer group does and that is what they have seen happen. It is the entire emphasis of our education system. Those with practical application who are willing to get their hands dirty are discouraged or looked down on as not doing so well in life. Will my hon. Friend comment on how the Government can deal with that, and how a change in attitude might go some way to stimulating more apprenticeships?
My hon. Friend has highlighted the flawed ethos of the Labour Government and their target culture of wanting to get 50% of our youngsters into university. Although that has been useful for many of our young people, and we should certainly not decry the importance of a university degree, it has led, as he has said, to a culture where people frown on youngsters who have not gone to university, which has left those youngsters feeling dejected and undervalued. That is a poor position to put ourselves in.
To refer back to the comments made by my hon. Friend the Member for Burnley (Gordon Birtwistle), we need to fill the gap in the skills sector, and there are many younger people who would be better off taking the skills route rather than going to university and perhaps doing a degree that is not necessarily recognised by employers or that is not relevant to getting into the labour market.
My hon. Friend is developing a powerful case for the role of apprenticeships in general. Does he agree that the statistic that 15% of employment in the private sector is provided by sole proprietorships shows that if we were to persuade sole proprietors to take on a single apprentice each, it would make an enormous difference to take-up in the country as a whole?
I agree with my hon. Friend’s important point. Another point is that many people who have traditionally taken the skilled route and come from small businesses have ended up as the entrepreneurs of the next generation. They are the ones who have taken forward their work for an engineering business, for example, started their own business and employed a number of others. It is important that youngsters get a good grounding, whether that be by getting a good degree at a good university or by going straight into employment and getting the right skills with an employer, through an apprenticeship, which will give them not just a meaningful career, but, potentially, a business through which they can support the economy by employing a number of other people.
In conclusion, I urge the Minister to consider how we can give our small businesses far more confidence to employ apprentices and break down some of the prohibitive barriers that I have mentioned. I am absolutely sure that, if he does that, it will add great value and complement the sterling work that he is undoubtedly doing to give our youngsters the skills to drive our economy not only for today, but for the future.
I congratulate my hon. Friend the Member for Gloucester (Richard Graham) on securing the debate and thank him for enabling us to discuss this important subject.
My father left school at 14. He benefited from an additional year at school, but he had very little in the way of qualifications and he served an apprenticeship for seven years before becoming a master plumber. I suppose that I served a kind of apprenticeship when I was articled as an accountant. Apprenticeships have almost disappeared from the industrial scene. The value of them coming back can be found not only in the many things that we have discussed today, but in the concept of a young person’s commitment to achieving something specific and focused over an extended period. Of course, a business or an organisation must also show commitment to sticking with an individual and seeing them through.
My hon. Friend talks very powerfully about apprenticeships. He has mentioned some of the history of apprenticeships and the apprenticeship that he went through, which was not unusual a number of years ago. Does he think that we need to change the culture, so that apprenticeships are far more valued? Should we perhaps return to some of the older values and have freemen of towns and cities and passing out ceremonies, where apprentices go along to the city hall or town hall and receive their papers from the mayor or lord mayor?
There is a lot in that idea because the concept of working towards and developing a skill—in the old days, a craft—and a profession has been lost. The idea of sticking with something and staying with it until a body of knowledge has been achieved or a degree of experience or skill has been acquired has been lost over the years. I remember very clearly my father’s small card showing that he was a master plumber. The importance of both an organisation’s and a young person’s commitment perhaps ought to be recognised more formally.
We all welcome the Government’s drive to increase the number of apprenticeship places, particularly in areas of unacceptably high youth unemployment—for example, Bradford. In a couple of the wards in my constituency, one in eight young people are not in education, employment or training, and they are desperately in need of some sort of future. It is perhaps unfashionable in some quarters to defend one of the schemes that is still in operation but on its last legs: the future jobs fund. However, I want to talk about the importance of what has been described by others as getting people ready for apprenticeships and making sure that young people are employable in the view of those who wish to take on apprentices.
We need to be very careful not to throw away the baby with the bathwater. The future jobs fund in Bradford got off to a poor, bureaucratic and frustratingly slow start, but it did become a success, particularly with categories of young people who struggled to get into apprenticeships. It was successful both in getting young people into work and in giving them the skills and the work experience that it was hoped would help to them into employment long into the future. More than half of young people on future jobs fund placements in Bradford did not return to benefits after 28 weeks. They found some sort of career progression after, in many cases, pretty difficult young lives. A major criticism of the future jobs fund has been that a high proportion of jobs were created in the public sector but, in Bradford, around 75% of the placements were in the voluntary or community sector. That is big society at its very best.
I should like to mention the Thorpe Edge project. As you will know, Mr Davies, that is a community furniture project that had 13 future jobs fund placements over a period of years. It was apparent that, for some of the young people on that project, getting out of bed before lunch was an achievement, let alone having an apprenticeship where they were expected to arrive at half-past 8 and work through until the leaving time that night for five days a week. The people on that project were fortunate because those who were responsible for running it had experience of dealing with young people in a difficult area. If someone on an apprenticeship did not turn up at 8.30 am and perhaps came in at 10 am, they would have probably lost their job. However, through their knowledge of the young person concerned, Thorpe Edge project supervisors knew that the young person concerned probably came from a background where there was a lone parent or the person concerned was on drugs or suffered from alcohol abuse. In such circumstances, simply getting into work at all was an achievement. By providing intensive support and help for some of those young people, the programme allowed them to get into college or employment.
The focus of my comments is on those people who simply will not get those apprenticeships, however many placements we manage to generate and however many placements the Government are willing to fund. Additional apprenticeships certainly offer a good alternative to the future jobs fund or schemes of that kind in many cases, but there is space for both types of programme. We need schemes that benefit people who are employable and who will do well out of placements and people who would struggle to get on to apprenticeships at all.
There is clearly a supply-side problem in many economies. I hope that the Minister will set out some of the measures that can be used to address the shortage of apprenticeship placements. A scheme in Bradford with the local social housing provider in communities recently received more than 600 applications for just seven apprenticeship places. Evidently, demand is massively outstripping supply.
Other hon. Members have raised all sorts of issues about the barriers and why businesses are not willing to take on apprenticeships, whether because of bureaucracy and red tape—we have mentioned some of those issues—or because of a lack of awareness of apprenticeships, as hon. Members said earlier. Many people who have been in business for years might never even have considered offering an apprenticeship. We need to consider what is happening in the schools and through the careers advice service. We also need to recognise that in some communities, certainly for small businesses, cost is an issue. We need to bear that in mind.
The Federation of Small Businesses has been quoted a lot with regard to the implications for small businesses. I understand that the Government have decided not to extend an apprenticeship grant for employers that provided some time-limited financial support for businesses. We still need to consider that as necessary for certain businesses, particularly small businesses, and in certain economies with high unemployment and a small number of available opportunities.
Let us not forget that although businesses receive 50% for post-19 and a full 100% for pre-19—I understand that that might be extended in some cases—they still have to pay for the young person. For many small businesses in particular, that is identified as being the most important cost. An FSB survey identified that it is simply too costly to take on. Of all the reasons why they were not taking on apprentices, the fact that it was just too costly came out top.
An FSB survey on skills identified that 66% of businesses said that, with the right measures in place, they would take on an apprentice. Those measures include a financial incentive for taking on an apprentice, greater clarity in terms of Government contributions to wage and training costs, and a separate body, interestingly, to manage the payroll costs. That has to be a way forward for many of our young people.
For 20-odd years, I worked in a university. We have heard some comments about university today. I agree that it was wrong to specify a 50% target. For many young people, the message was that if they do not get to university they have failed, and that closed up a lot of options. I also have tell hon. Members that, as someone who worked in a university for nearly 25 years in total, many young people, especially towards the end, were there because they did not know where else to be. They were there to find themselves and to delay a decision. They were there to gain something—a qualification, which they hoped would be useful—but also to defer a judgment on what they should do with their lives.
I will come to that in a few moments. When I announce the details of the statistical first release to the House at the end of the month, I am confident that they will show substantial progress and achievement. As hon. Members will know, provisional data already in the public domain suggest that we have made remarkable progress, despite the difficult economic circumstances in which, as has been said, some firms might not usually be expected to consider training or employing new staff.
The commitment that I have articulated was confirmed in the Budget, when the Chancellor announced a further £180 million of funding for apprenticeships. That will enable us to create 40,000 places for young unemployed people, taking them from disengagement to re-engagement, and an additional 10,000 places for advanced and higher level apprenticeships that are focused on SMEs.
The work that I am doing with the Department for Work and Pensions has been mentioned. To an unprecedented degree, I am working with my colleagues to ensure that the welfare reforms being introduced, and particularly the Work programme, marry with the work we are doing on training, skills and apprenticeships. It is important that the 100,000 additional work placements that have been secured have a close relationship with subsequent training and that the system is progressive. The experiences that people gain as they move from disengagement to re-engagement should lead to further learning and training and ultimately to work.
Under the previous Government, there was a shocking drop-out rate in the number of apprenticeships started and those completed. In 2009-10 alone, nearly 280,000 apprenticeships were started but only 171,500 were completed. That is shocking. Will the Minister assure me that the Government will pay far more attention to that issue? Although we cannot guarantee that every apprenticeship will be completed, we should ensure that we get a far better rate of completion than in the past.
Even a Minister as confident as I am would not wish to disagree with my hon. Friend, because he is so highly regarded both in his constituency and in the House. None the less, I must say in fairness that the previous Government made progress on completions—I do not like to say things in the House that I cannot say with candour. Although it is true that completions, both under the previous Government and this Government have posed a challenge—as described by the hon. Member for Blackpool South—considerable progress was made by the previous Government. Furthermore, to be ever more generous and even more self-deprecating, let me say that it will be a challenge for us to maintain completion levels as we expand the programme. One risk of a rapid expansion in apprenticeships is that we will need to be careful about starts and completions. As more people are drawn into the system by the energy that we invest and the resources we provide, unless we are careful, there is a risk that the number of completions will suffer. As has been suggested, I am working closely with my officials and we must monitor the situation through the NAS and look at what measures we can put into place to ensure completions.
I do not want to move too far from the main thrust of my argument, but one such measure might be to look at outcome payments for large apprenticeship providers—in other words, to work with those large providers and ensure that payment is made on completion. I am in discussion with a number of major national companies that are extremely interested in engaging in such a system, and we will pilot such a scheme with a number of significant apprenticeship providers. That is one of the things that we can do with regard to completions, but my hon. Friend the Member for Nuneaton was right to draw that issue to hon. Members’ attention, as was the shadow Minister, the hon. Member for Blackpool South.
The difficulty for me in all this is that I have invested a considerable amount of my political reputation on the basis that we will indeed create such numbers of apprenticeships. That might be described as a bold move. The shadow Minister and possibly others would be disappointed if I was not poetic at some time in this speech—I was going to say “performance”, but I do not want to undersell myself—and it was Ezra Pound who said:
“If a man isn’t willing to take some risk for his opinions, either his opinions are no good or he’s no good.”
The risk that I have taken in respect of my opinions is indeed the risk about our endeavours to grow apprenticeship numbers dramatically, but we have to take such risks if we believe that something is right, as Pound suggested, and I do believe that this is right for reasons that I shall detail as I respond to the debate.
(13 years, 2 months ago)
Commons ChamberWe will go further than that: we are making sure that UKTI is focused like a laser on small businesses in the manufacturing sector. That is why we are changing the budget and the structure, and making sure that in the regions outside the south-east there is a strong network—a strong set of roots—so that we can support manufacturing more effectively than the Labour party did in 12 years in office.
I recently met business leaders from the Coventry and Warwickshire chamber of commerce. They are extremely heartened by the current review of regulation and red tape, but they are keen to know when there will be tangible changes. Will the Minister therefore tell the businesses in my constituency when they can expect to see tangible progress from this welcome review?
I will be delighted to do so. Not only have we got the moratorium exempting small businesses from future regulation, but we have cut by 70% down to 46 the 157 proposals, many of them legacies from the past Government, and only 11 of them will cost business anything at all. We are ending the gold-plating of e-regulations, and we are changing the approach so that we sunset regulation in the future. Each of those steps will make a difference, and I will make sure that we report back to the House each and every year.
(13 years, 4 months ago)
Commons ChamberIt is always an honour to follow the hon. Member for Stoke-on-Trent Central (Tristram Hunt), even though his arithmetic and his assessment of inflation seem like those of the Labour party of the late 1970s.
Quite often during Opposition day debates, purely partisan posturing overtakes thoughtful and reasoned debate. People put partisan politics before making decisions for the right reasons, even if such decisions have to be taken with a heavy heart. I would not say that I am disappointed by the level of party politics that we have heard, particularly from the Opposition Benches, but I am more than disappointed by the way in which the Opposition have put their points.
Once again, the Opposition have given us no ideas and shown no vision on higher education. They have not acknowledged that Labour introduced tuition fees and increased them on more than one occasion when it was in government. They have also not acknowledged that they instigated the Browne review. Lord Mandelson, the former Business Secretary, now says that when the previous Government instigated the review in 2009, he assumed, as the Treasury did, that the outcome would have to include a significant further increase in tuition fees. Whether that was Labour party policy at the time, you have to acknowledge that the Labour party gave the Browne review its terms of reference—[Hon. Members: “You?”] Sorry, Mr Speaker.
The Labour party no longer acknowledges that it flirted with the graduate tax—Labour Members seem to be in denial. Only one thing is clear: they have no plan for higher education.
I will not because I want to give other hon. Members an opportunity.
The motion makes important points about fees and how they will be implemented, and I hope the Minister comments on the timetable and on how quickly students and their parents can find out what the true level of fees will be. That is important because a small number of parents and students go to their constituency MPs to ask for that information so that they can plan for the future. I understand why the Government want to get things right, but the uncertainty does not help.
However, Labour’s constant politics of fear helps no one. Rather than supporting our young people by engaging in the debate and trying to get things right, Labour Members maintain the party line—a misleading line that fills our young people with fear and dread, putting them on the back foot before they even learn the facts, crushing and stifling aspiration, and certainly not encouraging it.
Aspiration is important, but it needs to be realistic. The most capable, regardless of their background, should have the opportunity to attend university. Under the new system, the Government will help to achieve that for young people. There will be lower repayments for student debts than under the current system, and most of those from underprivileged backgrounds will have the opportunity to get into higher education.
Warwick university—one of my local universities—says that all students whose parents have an income of £25,000 or less will receive a package of up to £4,500 a year to assist with their studies. We must also acknowledge that the Government’s policy involves no up-front fees, and that students will not start paying until they are graduates earning £21,000 a year, rather than the £15,000 a year under the current system. As Labour Members know, monthly payments will also be lower.
That is not to say that the current system or the system that the Government propose are ideal. Young people will leave university with debt, and nobody in the House would wish that on a young person. However, we must be realistic. For many young people, taking on that debt is the path to a career—a good and proper career in which they make a substantial living. We know that young people who go to university earn on average £100,000 more over their career than young people who do not.
That is not to say that university is a success for all. It is not, and many come out of our universities unable to gain employment for many years. Many certainly do not enjoy the glittering careers that they thought they would have when they initially went to university. I know that because I used to work for a firm of lawyers that received hundreds of thousands of applications for training contracts every year—applications for jobs that just did not exist. That is not acknowledged by the Labour party.
To sum up, the proposed new system is not perfect or ideal, but it is a move in the right direction. Social mobility stalled under Labour, but it will begin to improve once again with the measures put in place by this coalition Government.
(13 years, 5 months ago)
Commons ChamberAs we outlined at the time of the last spending review, we sought to construct a replacement scheme that would, within the resources available, be more progressive, and we believe that constituencies such as the hon. Gentleman’s will benefit more than some constituencies represented by Conservative Members. We will keep the scheme under review, however. A quality impact assessment has been prepared, and I will be happy to talk to the hon. Gentleman if there are specific problems in supporting the many students in his cosmopolitan constituency who want to stay on.
I warmly welcome my right hon. Friend’s statement. I also welcome the consultation, but ask him to ensure that the details of the student bursary fund, including the allocations to further education colleges, are confirmed as quickly as possible, in order to give certainty to those students requiring assistance who are looking to enter further education this year.
My hon. Friend makes a good point. As ever, I wanted to balance the requirement to consult widely—and I am grateful to my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes) for talking to so many students about what exactly was required—with the need to move on so as to provide certainty to institutions. We undertook a process of consultation beforehand and brought forward these proposals in line with principles we outlined at the time of the comprehensive spending review. We will now consult in the next eight weeks in order to make sure the proposals can be implemented fairly.
(13 years, 6 months ago)
Commons ChamberNo, I am afraid that I have tried a few interventions from the Government Benches, and they have not really added to the quality of the debate.
The Secretary of State himself described the abolition of regional development agencies as “chaotic” and “Maoist”. In June he gave a perfectly sensible interview, saying that regions that wanted to keep their regional development agencies could. He was overruled. He lost. The Communities Secretary beat him. Now no part of England has a fully functioning local economic partnership or a fully functioning regional development agency. It is the last thing that business needed. The Secretary of State let the Communities Secretary tear up regional planning policies and put nothing in their place. Some 160,000 planning permissions for new homes have been lost to the building industry already. That is a blow to construction, which is already struggling and reeling from the cancellation of Building Schools for the Future. Businesses have no idea how planning applications for new developments will be treated in different parts of the country under the new policies. It is the last thing that business needs.
The Business Secretary has failed to ensure that the migration cap does not prevent growth. Just yesterday, Airbus UK told the Select Committee on Business, Innovation and Skills that it could not access tier 2 immigration visas and that the Home Office was not responding or answering telephone calls on the matter. The Business Secretary lost that argument. The Home Office’s student visa policy threatens the income of further education colleges and universities. The UK’s seventh biggest export industry is now being put at risk because the Business Secretary has lost that battle too. Our universities are huge drivers of growth. This year above all years, the Business Secretary should have told every vice-chancellor to concentrate every effort on promoting growth and their business links in the regional, national and international economy. Instead, every university is preoccupied with working out how the shambolic, unfair and unnecessary new fees system is meant to work. That is a complete diversion from what business needed.
In September, the Business Secretary promised tough action on banks, arguing that there was a “compelling case” for taxing them if they continued to pay out bonuses when businesses cannot get access to finance. He has obviously lost that battle, too. Project Merlin has still not reported. Small businesses are still struggling to get finance. The Tory-led Government whom the Business Secretary supports are desperately casting around for face-saving measures while tax on the banks is being cut. Grants for business investment have stopped. Nissan says that those grants helped to safeguard or create 1,600 jobs in the north-east. Indeed, Nissan told the Business, Innovation and Skills Committee:
“The UK has a clear choice of whether it chooses to fight for new business, new jobs, and rebalance the economy or allow the opportunity of this business to go elsewhere.”
We should all be concerned that the Business Secretary has made the wrong choice.
The funding for English regional development has been slashed from about £1.4 billion a year from the regional development agencies to the £1.4 billion in the regional growth fund over three years. That is funding for the whole of English business, which, to put it into perspective, is about the same amount that the Government are planning to spend on sub-post offices. Predictably, because the regional growth fund has been told to include bids for transport and housing, it has been over-subscribed tenfold. The Business Secretary is in a panic, because the future jobs fund has been scrapped and unemployment is rising. Businesses were promised that the fund would support sustainable private sector growth and help to rebalance the economy. Will he confirm that he has changed the rules at the last minute, discouraging bids that will not create short-term sticking-plaster jobs, and that plans to expand Birmingham airport and regenerate Longbridge, which were going to be put into the regional growth fund, have been put on hold, because it is said that they have no chance of succeeding? There are many projects with private sector commitment, which could lever in huge sums of private investment, that are not going ahead. They will not even be considered, because this Tory-led Government are not prepared to tax the banks fairly to invest in jobs and growth.
The broadband infrastructure is vital for business, but it has been delayed and delayed again. Labour had a costed commitment to achieving universal broadband by 2012 and high-speed broadband by 2015. The Government have put back universal broadband by three years, putting the UK in the broadband slow lane.
There is no coherent approach to the use of tax policy to support business growth. Corporation tax has been cut, rewarding the banks, while capital allowances for manufacturers have been slashed. There is total confusion about the future of research and development tax credits. At one moment, the Government rightly back Labour’s patent box for the pharmaceutical industry; the next, Labour’s support for the video games industry is dropped, causing a predicted loss of 25% of jobs in that sector. The Government trumpet an additional 75,000 apprenticeships over the next three years, yet Labour increased the number from a planned 200,000 to 279,000 in the last year alone. This Government are slowing the growth in apprenticeships, and their own figures show that, each year, 500,000 fewer adults will get public support to improve their skills.
The Government’s record of failure in regional policy, higher education, bank lending and bankers’ bonuses is lengthy. It is hard to identify a single pro-business, pro-growth policy that BIS has successfully championed against opposition from the Treasury, the Department for Communities and Local Government and other Departments. There is no strategy for growth, and no one knows where the Government expect it to come from, how they will support it or how it will be achieved.
Today, Sir James Dyson, the Conservatives’ own innovation champion, has referred favourably to President Obama, who said:
“In America, innovation doesn’t just change our lives. It’s how we make a living.”
Sir James commented:
“That might seem like political rhetoric to some people, but I wish this philosophy was shared by the British Government.”
That is from the Government’s own innovation champion.
Sir Richard Lambert has said that the Government have
“taken a series of policy initiatives for political reasons, apparently careless of the damage that they might do to business and to job creation.”
We saw that happening just before Christmas. For no other reason than the Business Secretary’s personal unsuitability to make a competition judgment, the Prime Minister transferred responsibility for an entire critical industry, the digital economy, to the Department for Culture, Media and Sport. There was no public policy reason for doing that. There was no consultation with business. The media and the creative industries have a great interest in the digital economy, but so do advanced manufacturing, the IT industry, the service sector and retail. The years that were spent bringing industrial sponsorship together within Whitehall so that business could work better with the Government were swept aside in the crudest possible act of media management, to save the Secretary of State’s face.
The same is true when we look forward. For all the words about rebalancing our economy and supporting key sectors, there is no sign of that happening. Governments cannot create private sector growth, but they can create the conditions in which the private sector is most likely to grow. In the areas in which we hope to compete with the best in the world, such as advanced manufacturing, business services, the creative industries and the low-carbon economy, every part of Government policy, from fundamental research to export support, needs to be properly aligned and working together. This Government cling to a different view, however. They believe that if they simply cut the public sector and cut corporation tax, the private sector will rise up of its own accord to fill the gap. That will not work. Sure, the Government will make the odd eye-catching announcement to hit the headlines and make it look as though they are doing something, but, fundamentally, they do not believe in an active role for the Government.
Yesterday, Pfizer said that it was closing its plant at Sandwich, affecting 2,400 employees and many more in smaller companies. That is one of the industries in which Britain should be leading the world. We have a huge advantage in fundamental and applied research and the NHS has huge potential for properly regulated clinical trials, yet one of the world’s leading manufacturers is closing a major plant here, in Kent. Only a few weeks ago, the Prime Minister told us how he had personally been on the phone to the leadership of Pfizer to encourage them to invest and employ people in the UK. The truth is that the Prime Minister has been snubbed. The Government and the Business Department were not players in that huge decision. Whatever the immediate reason for Pfizer’s action, this warns us all that nothing can be taken for granted if this country is to remain strong in this global industry.
In the past year, the Business Department has done nothing apart from implementing Labour’s patent box tax relief. Science spending has been cut in real terms, with capital investment down by 40%. The Government have not set out a clear vision of the future of the pharmaceutical and bioscience industries. They have not said how they will support them, or made it clear to the rest of the world that we will fight tooth and claw for the largest share of this global industry.
The same challenge is true for the other key sectors of the economy—the areas in which, if we do not succeed, we will not be able to pay our way in the world. The truth is that where there should be action, there is a talking shop. There is no plan, no strategy and no vision. There is no leadership and no urgency. The Government are drifting, and making the wrong choices. They are buffeted by events, but not in control of them. For all our sakes, it is time they got a grip.
Let me finish my point about manufacturing and then I will take another intervention. I shall pursue the point I was making in response to my hon. Friend the Member for Stratford-on-Avon about what we have inherited from the previous Government—a decade of remarkable de-industrialisation. Let us go back over the numbers. In 1997 the share of manufacturing in the British economy was about 20%—just a little less than in Germany, Japan and Italy. A decade later it had fallen to 11%, and far more rapidly than in any other industrial country. Manufacturing employment in that period fell from 4.3 million to 2.5 million, so we lost almost 2 million people in the manufacturing sector. The manufacturing trade deficit over that period rose from £7 billion to £53 billion.
My right hon. Friend’s argument is compelling. Does he agree that the Labour Government’s record on manufacturing was absolutely despicable, because we lost those 1.8 million manufacturing jobs on their watch? Labour Members seem to forget that.
The hon. Gentleman is absolutely right: that is the core point. It is a strange irony, because many Labour Members came from industrial Britain and had built their movement on it. In that decade, however, manufacturing industry was substantially devastated, and we are living with the legacy of it now. What we must emphasise—this is the core of our growth strategy, which the hon. Member for Nottingham East (Chris Leslie) asked about—is that manufacturing matters, and we will do everything we can to support it.
With the greatest respect, I am not sure what planet the hon. Lady lives on. The figures on the economy are clear: the Government inherited a growing economy, but it has now stalled and gone into reverse.
My third example relates to the abolition of the regional development agencies. Thirty years ago, the midlands used to be one of the two strongest economies in the country, but it is now one of the two weakest. We had the most successful RDA, Advantage West Midlands, of anywhere in Britain. For every £1 of public money invested, £8.14 was produced in wealth in the private sector. Crucially and in addition, Advantage West Midlands managed shocks to the motor industry, such as the closure of Rover, and promoted the motor manufacturing cluster in the midlands. The cluster is 150,000 strong, from the prime companies through the components companies, the machine tool companies and the logistics companies, all the way down to the games companies with which Jaguar Land Rover is working right now on the next generation of in-car entertainment systems. That cluster, galvanised by Advantage West Midlands, was one of the key reasons why Jaguar Land Rover last year decided to commit to Britain as its global hub and to invest £5 billion over 10 years, creating thousands of jobs and bringing wealth to our economy.
The hon. Gentleman praises the RDA Advantage West Midlands. How does he square that praise with the fact that private sector employment in the west midlands fell rather than increased during the time that this RDA was in place?
I believe in the real world of work and in listening to the voice of the business community. There has been widespread concern and criticism from across the business community in the midlands about the abolition of Advantage West Midlands. Indeed, Business Voice WM, on behalf of the business community in the midlands, has put forward a proposal that stresses the importance of maintaining a regional strategic structure if the success of that motor manufacturing cluster is to continue.
It is an honour to follow the hon. Member for Birmingham, Erdington (Jack Dromey) who has a very positive outlook on the current situation. I welcome the opportunity to speak in this debate. We should not underestimate the importance of getting economic growth back into our economy. We still face difficult economic times. We must not forget that we have had the worst recession since the second world war, with six quarters of negative growth. We are now suffering from the hangover from that, and from the debt inherited from Labour.
The deficit is one of the greatest barriers to growth. My right hon. Friend the Chancellor is right to stick to his guns on his deficit-reducing strategy. The IMF agrees: it has identified that insufficient progress with fiscal consolidation in the medium term would be a key downside risk to growth. We should all remember that.
The path to growth is likely to be rocky, but we must put the building blocks in place to rebalance our economy into a more sustainable and resilient model, based on a broader spread of industry, rather than put all our eggs into one basket. We must also listen to business. Before and after the election, business was looking for three things—lower taxes, less regulation and more bank lending. Some progress has been made by the new Government and there is far greater intent than there was in the past. But there is still some way to go.
I read today’s motion with interest. It seems to hark back to a golden age in which the previous Government proclaimed the success of the RDAs. The former Prime Minister, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), and his then Business Secretary toured the country handing out rubber cheques that no one ever mentioned in the Budget, and which could never have been cashed. Their tenure did not result in an enviable record. The RDAs were top-heavy, with £246 million spent on administration alone in 2008-09. That is not a record to be proud of. However, despite the RDA my region—the west midlands—saw a contraction in private sector employment. That does not make sense, because the RDA was there to promote private sector employment, not throw money into the public sector. Across the country we saw a reduction in manufacturing jobs of 1.8 million under the Labour Government. That is not a record to be proud of, nor is it a golden legacy; it is something that this Government have inherited and are having to deal with.
Let me turn to the coalition Government and the difficult balance that we are having to strike between dealing with the deficit and getting sustainable growth. Despite the Opposition’s rhetoric, the coalition parties do have a plan for sustainable growth. There is a common theme or thread running through many policy areas. We have the LEPs, which are far more focused and business-led. I am sure that they will not be like Labour’s talking shops, which disengaged business. In particular, the Coventry and Warwickshire LEP, with which I have been proud to associate myself, is doing a fantastic job promoting the Coventry and Warwickshire area. I look forward to the progress that it will make in future.
Nor should we dismiss the £30 billion of investment being pumped into our transport infrastructure, or the fact that the regional growth fund is bringing £1.4 billion into the economy to pump-prime projects such as those being considered at MIRA—the Motor Industry Research Association—on the A5 on the edge of my constituency, which will bring in £250 million of private sector investment and could create 2,000 jobs. [Interruption.] Opposition Members shake their heads. They obviously do not want such investments to be made. I am also encouraged by the way in which the Government have started to reduce red tape and regulation, with the one-in, one-out strategy, reducing gold-plating and introducing business mentors to help new businesses grow. All those measures will create jobs. I hope that when the Minister winds up he will elaborate on how we will expedite that process and ensure that it moves forward far more quickly.
I am also pleased that we are committed to reducing corporation tax, which we need to do to move all businesses forward. Lower taxes are a way of stimulating the economy, benefiting not just the banks, as Opposition Members have said. I am also absolutely delighted that my hon. Friend the Minister for Further Education, Skills and Lifelong Learning has introduced another 75,000 apprenticeships this year to close the skills gap left by Labour. We had to bring in labour from abroad to fill the skills gap when the economy was expanding, when we had many people here who could have filled it themselves. I have only a short time left, so I hope that when the Minister winds up he can give me more information on what is happening with bank lending, which is an extremely important part of the package. I know that the previous Government failed miserably on that, and that the new Government are grappling to get it right, but if the Minister can tell us what is happening, that would be very helpful for us to pass back to our constituencies.
To conclude, we do have a package for growth and we are moving it forward. There are areas where it needs to be moved forward more quickly—
(13 years, 7 months ago)
Commons ChamberToday we are discussing the important subject of EMA, an extremely well-intentioned product of the previous Government that, at its most effective, helped young people to continue their education. At its worst, though, it is just another in a series of policies adopted by the previous Government with a lot of dead-weight. I am sorry if that offends the hon. Member for Wigan (Lisa Nandy), but we have to acknowledge that, in the case of many policies of the previous Government, a lot of money was spent and very little achieved, after a certain point. EMA is one of those cases. It is one of the factors that led the previous Government to rack up such a large deficit for the country—a deficit that the coalition Government now have to sort out.
I do not want to dwell on the debt argument, but it currently costs this country £564 million a year to provide EMA for our young people. As I say, the scheme is well-intentioned, but when a policy lacks targeting and loses its focus, as EMA seems to have done in certain ways, all we are doing is building up a credit card of debt for our young people. We are actually encumbering the generation that we are giving EMA with a massive debt—and we are encumbering their children with huge debts, which they will be paying off, through higher taxes, for years to come. They will suffer reductions in service as a result of the debt interest that this country is paying.
Any sensible Government would want a targeted scheme to allow young people to access further education. That is what I hope the current Government are trying to achieve. Rather than concentrate on the inputs, and tailoring the programme of support for young people on the basis of how much money we put in, we should first set a target for what we want to achieve and what outcomes we want, and then look at what money we need to support that programme. To that end, we need to look at the impediments to some of our younger people gaining access to further education. Gaining that access is a problem, in some ways, for many young people; 12% have clearly said that if they did not have some sort of financial support, they would not be able to continue their studies, which we need certainly to address and overcome.
I have two fantastic post-16 colleges in my constituency, King Edward VI college and North Warwickshire and Hinckley college. I have met a number of students at North Warwickshire and Hinckley college, and had a detailed discussion with them. Their biggest concern, and the biggest impediment that they saw to young people continuing their studies, was the issue of travel to and from college. We have to address that, and not just for people from rural areas; it is a problem for people from urban areas as well.
We also have to address the fact that, as has been mentioned from the Opposition Benches, during the current academic year many students have been used to receiving EMA and benefiting from it, especially for their travel. The Government must make sure that young people who have gone to college on that basis this year do not drop out next year. We need to clear up quickly what the system will be next year, to make sure that our young people make informed choices about their studies once they finish school this year.
Many local authorities have reduced or stopped the discretionary travel supplement that used to be provided. One or two schemes are still available, but across the country many have disappeared. We need to look into that and see how, as a Government, we can help young people with their travel.
Earlier, the shadow Secretary of State was rather derogatory to our young people, saying that it was not appropriate for them to do part-time work. That is not a concept that we have covered in the Chamber today. Part-time work is extremely important not just to earn money to provide things over and above those that young people need for their education, but to help young people develop soft skills to bridge the gap between education and employment. I speak to many people in commerce who say that younger people need the best soft skills they can get to integrate into the workplace. It is extremely important that that is encouraged in our further education system.
To conclude, as I do not have much time, I wholeheartedly support the Government amendment, especially as it relates to travel, but I have concerns about how the new scheme will look and the amount of money to be put into it. I hope that tonight the Minister will dispel a few of those hares that have been running—
(13 years, 7 months ago)
Commons ChamberPerhaps, Mr Speaker, we could travel together to the delights of the north-east. I would be only too pleased to ensure that we make a joint effort, working with my colleague, the tourism Minister, on the matter. The north-east has some marvellous places to visit, although, given that I am a born Cornishman, it was a slight distance for me to travel when I was child. Nevertheless, we need to consider that area carefully and I am happy to accede to the hon. Gentleman’s request.
I would like to bring to the Minister’s attention a proposal by the Motor Industry Research Association, which is based on the border of my constituency and that of my hon. Friend the Member for Bosworth (David Tredinnick), to build a new technology park. It aims to attract £250 million in investment and directly create 2,000 jobs in the next 10 years, with 200 in place by 2013. MIRA wants to bid for regional growth funding shortly to facilitate that project. Will the Minister agree to meet representatives of MIRA to discuss that exciting proposal for the east and west midlands?