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Youth Training Scheme

Volume 82: debated on Monday 1 July 1985

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3.37 pm

With permission, Mr. Speaker, I would like to make a statement on youth training.

My right hon. Friend the Chancellor of the Exchequer announced in his Budget statement that he was making extra resources available which could fund a two-year youth training scheme. On the same day I asked the Manpower Services Commission to consult and develop proposals for such a scheme to start from 1 April next year and to report to me in three months.

On 27 June the commission, which includes representatives fom the CBI, local authorities, education interests and the TUC, unanimously approved proposals for the two-year scheme. The chairman immediately submitted these to me and asked for the earliest possible approval.

I am pleased to inform the House that I have now approved the broad framework of these proposals and I have today authorised the commission to proceed with implementation, within the resource levels previously announced and on the planned date of 1 April.

The proposals represent a major step forward in improving the opportunities for young people both in training, and work experience. The scheme will give broad-based training in the first year, with a greater emphasis on more specific training in the second year, with the opportunity for all to obtain a vocational qualification. This will be building on the foundations laid by the current youth training scheme, which more than three quarters of a million young people have entered so far. The youth training scheme has opened new horizons for young people and employers and has brought home to many the contribution which training can make to improving employability and productivity. I pay tribute to the work of all the individuals and organisations who have played their part in the development of the one-year youth training scheme.

The main features of the new scheme will be as follows: There will be a quality training programme leading to vocational qualifications and there will be at least 20 weeks off-the-job training over two years. In addition to a planned programme of on-the-job training and work experience. There will be two years' training for 16-year-old school leavers and one year for 17-year-old school leavers.

There will be a training agreement between the trainee and those responsible for his training setting out their respective rights and responsibilities, including the detail of each young person's training programme.

From April 1987, only approved training organisations will be able to take part, after they have satisfied criteria drawn up by the Manpower Services Commission, and a new training standards advisory service will be set up to monitor the quality of the training provided. Trainees will be paid an allowance of £27–30 per week in the first year and £35 per week in the second year.

A basic grant of £160 per month will be payable in respect of each trainee to his training provider. There will be a managing agent's fee of £110 per annum.

We recognise the special needs of some areas and some young people who may find it difficult to find employer-based training places and it is proposed that a premium payment of £110 per month per trainee will be paid in such cases to those providing alternative training.

In approving that broad framework I have approved an increase in the existing trainee allowance to £27·30 with effect from the beginning of September this year, as recommended by the commission.

Under the new scheme, up to 200,000 more young people will be in training than under the existing youth training scheme, bringing the total to over half a million in training at any one time. This will mean a major improvement in the opportunities for training and work experience for our young people and one that will become a permament and essential feature of vocational education and training provision in this country.

Will the Secretary of State acknowledge that there is no mention of a new training inspectorate in the version of the statement that I have received, and that it is unfair to make such an announcement when the Opposition spokesman has not been notified of it?

Will the right hon. Gentleman acknowledge that the backdrop to his announcement is that there are almost 1·25 million unemployed under-25-year-olds and that about 300,000 people under the age of 25 have not had a job since leaving school, that young people have borne the brunt of the Tory Government's social security cuts — including the loss of board and lodging allowance after a few weeks in one town — and that there is a near certainty that young people are about to have the flimsy protection of the wages councils removed? In other words, young people are facing a crisis as a result of the Government's actions.

Will the Secretary of State acknowledge that, despite the Government's massive propaganda exercise, the customers of the YTS—the youngsters—do not believe that they will receive that which they most desire, which is full-time permanent employment, at the end of the scheme? Does he further acknowledge that YTS is no longer about providing a permanent bridge between school and work, to use the fine words that were used when the scheme was launched four years ago, but is more a gangway to the dole queue for about one third of the youngsters, who fail to obtain a job when they complete their scheme?

Will the Secretary of State confirm that, despite all his assurances about no job substitution, one undesirable spin-off from the YTS has been a dramatic reduction in apprenticeships, and that a one-year or even a two-year scheme is not a proper replacement for a well planned three or four-year apprenticeship scheme as organised by the engineering industry training board? The collapse of apprenticeships over the past five years has resulted in the skill shortages about which the Secretary of State now complains. Will he confirm that many employers are showing a marked reluctance to become involved in a two-year scheme unless there is a substantial increase in Government money for them.

Is the right hon. Gentleman aware that parents, trade unionists and the Labour party are not satisfied that enough effort has been put into health and safety cover for youngsters on YTS? Far too many youngsters are suffering unnecessary accidents. Will he try to improve the involvement in YTS of the Health and Safety Executive?

Does the right hon. Gentleman agree that the allowances that he has announced are a scandal and that the Labour Government paid an allowance which would be £37 a week at today's prices? That should be compared with the Government's proposed £27·30 for the first year and £35 for the second. Do the Government have any plans ever to pay young trainees a fair allowance?

Is the right hon. Gentleman aware that the Labour party would welcome a comprehensive two-year training scheme for young people which included an education allowance which allowed academically gifted youngsters from poorer homes to remain in higher education, which would guarantee employment for the vast majority of youngsters at the scheme's end? It is obvious that the nation will have to wait for a Labour Government, who will expand the economy and get the country moving again, before such a scheme can be put into operation.

I do not think that I am the only hon. Member who regarded that as an extraordinarily sour response to an announcement which is extremely good news for all youngsters corning out of school, as it will improve their prospects. It is especially sour as it comes from the spokesman of a party which considered introducing such a scheme and then refused to approve it and was not prepared to put forward the necessary funds. Instead, Labour introduced the youth opportunities programme, which had no training content and offered nothing like the prospects for the future that our scheme offers.

When I listen to the sour attempts of the hon. Member for St. Helens, North (Mr. Evans) and some of his colleagues to score party political points, I am much more impressed with the attitude of the TUC, which has unanimously supported these proposals. I take comfort riot from the hon. Gentleman's statement but from the comments of young people on YTS. All the evidence shows that there is increasing support for the scheme and increasing recognition of what it does. As from next year, every 16-year-old school leaver will be assured of two years of good training and work experience. Every parent should know that too. The country has never previously been able to offer that assurance, but we are determined to achieve it.

Is my right hon. Friend aware that this development is widely welcomed? In view of the extraordinary farrago of nonsense that we have just heard from the hon. Member for St. Helens, North (Mr. Evans), it is worth observing that, when the engineering industry training board came to see some of us the other day it said that it wanted to shorten apprenticeships, not to four years, but to about two and a half years. It is nonsense for the Opposition to claim that the earlier scheme offered by that training board is better than what is now proposed.

I think that the hon. Member for St. Helens, North is involved in the engineering industry, and his comments about apprenticeships were those of the old world, which offered that type of training. We do not want a limited number of people attending schemes on a time-serving basis, or access for only one age group. We want to open training, if possible to all ages, but certainly to widen opportunities for young people. We want training that is based on the achievement of standards, rather than on time serving. That is the modern approach, and what the TUC supports. I am delighted to have that support.

Is the Secretary of State aware that he has a great responsibility to get this right, as many trainees already do not stay the whole of the first year, and therefore the second year must be a big improvement on the first? Many employers are not sure that they can keep trainees interested for two years, so schemes must be improved and more must be put into them. The Government are not putting in enough money. They are trying to get the scheme on the cheap. The Government are trying to get two years for the price of one. If they are really concerned, they should be willing to put in the money.

Is the right hon. Gentleman aware that the level of allowances that he has announced is not high enough, and that part of maturing to adulthood is having one's own money and using it? Is he further aware that what we need is a proper inquiry into the funding of a proper scheme?

I appreciate the hon. Gentleman's more moderate and constructive approach, in relative terms. I know of his interest, as Chairman of the Select Committee, which also has taken an interest in the YTS. The hon. Gentleman will recognise that we are looking to employers for a major contribution in the launching of the new scheme. In looking at the finances required, it is not sufficient to look just at the Government's contribution. The scheme is based very much on employers, who recognise its value, making their contribution as well. The hon. Gentleman said that he was looking for improvement. I pay tribute to my predecessors who launched the scheme. It is a remarkable achievement, but we are continually looking for improvement. We shall certainly look to the second year to make a greater improvement in the quality of the scheme.

Will my right hon. Friend confirm that, contrary to the assertions of the hon. Member for St. Helens, North (Mr. Evans), the scheme has in fact proved an effective route to long-term employment for young people? Can my right hon. Friend give the House the latest figures for the percentage of those who, on leaving the scheme, continue in employment or further education?

I am glad to have that piece of heckling from the hon. Gentleman, so that I can correct the totally erroneous figure that he has given. He quoted a figure of 48 per cent., which happens to be a small sample of a few trainees in October. In response to my hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard), the overall figure for those going on to full-time jobs or going back to further education or training is about 70 per cent.

I give the Secretary of State's announcement a qualified welcome. Will he also tell the House the number of people who are dropping out of the scheme in any given month? One figure that was suggested was 56 per cent. for one month. Will the right hon. Gentleman do anything to implement the proposals of the Manpower Services Commission for improving the quality of some of the schemes concerned? Has he repudiated entirely the suggestion made by the Secretary of State for Trade and Industry that people who are involved in these schemes might lose their supplementary benefit?

The position has been made absolutely clear by myself, by the Prime Minister and by everybody else concerned. We have no proposals on that matter. The hon.

Gentleman sought to discuss the number dropping out of the scheme. I hope he will recognise that a number of the so-called drop-outs go off into full-time employment and take jobs elsewhere. I do not regard that in any way as a failure. We intend the scheme to give youngsters a good start in life. Some respond more quickly than others. Some find that they can go out and get other jobs that may reward them better. I do not regard that as disappointment. We want to give all the youngsters a better start in life. In considering these matters the House should recognise the real achievement that has been made. I pay tribute to the commission and the work that it has done in putting forward the proposals. It is a challenge. It will not be easy to meet it. I am grateful for all the work that has been done by the commission and by all the staff in bringing forward the proposals.

Is my right hon. Friend aware that today's announcement will be much welcomed in my constituency which has high unemployment for the south-east of England and where there has been a dramatic loss of apprenticeships over recent years? Is he further aware that I have one of the excellent ITECs in my constituency? Can he offer any hope that he will extend the courses provided by these excellent colleges for youngsters who are similarly qualified to those going on YTS? Will there be any hope of a vocational qualification at the end of a possible two-year ITEC course?

As my hon. Friend said, ITECs have been a considerable success. Indeed, I visited two schemes—one in Glasgow and the other in Cumbernauld, which are both areas of significant unemployment. The managers reported that they were placing more than 90 per cent. of the youngsters in full-time jobs at the end of their ITEC courses. We are studying ITECs in particular, because this announcement does not cover them. Further study is being made to ensure that ITECs can continue effectively under the two-year scheme.

Does the Secretary of State want to attract people from full-time education to YTS courses? Is he aware that during the past two years the number of youngsters staying on in education has declined, almost certainly because of the attractions of the YTS training allowance? Would it not be a good idea to treat those who remain in education and those who attend YTS in the same way for the purpose of allowances?

I notice that the hon. Gentleman and his hon. Friends are making bizarre proposals, which will be fairly expensive, if allowances are paid to those in full-time education and to those in YTS. We believe that it is right and fair to pay a training allowance. We have also made it clear that we are determined to ensure that it remains a high quality training scheme and to improve its quality. Therefore, I make no apologies if we moderate the training allowance in the interests of maintaining the quality of training on the scheme. That is overwhelmingly in the long-term interests of all youngsters on the scheme.

As more people will be needed to train young people in this scheme, can my right hon. Friend confirm that a big effort will be made by the Manpower Services Commission and employers to recruit people from among the skilled unemployed to help with training in the scheme, which, among other things, would reduce the level of unemployment?

I am grateful to my hon. Friend for his comment. Perhaps I should emphasise that to launch a two-year YTS is a major challenge. It will be a major challenge to ensure that we have the places available and the staff to man the scheme. The role of employers will be significant, but, in view of their tremendous support for the one-year training scheme, I am confident that they will recognise both the challenge and the opportunity that this expansion of training will bring.

Is not the DHSS policy on board and lodging allowances completely at odds with the policy which the Secretary of State has announced today? If young people cannot get a job locally now, unlike previously, they will not be able to get a job anywhere.

I do not follow the logic of that argument. We are determined to ensure both that training is available and that opportunities exist locally. I am not, therefore, sure what the hon. Gentleman's point is.

I congratulate my right hon. Friend unreservedly on his announcement today. In the light of the sustained and co-ordinated Marxist-led campaign against YTS, which this afternoon has unfortunately found an echo on the Labour party Front Bench, will my right hon. Friend redouble his efforts to ensure that the picture that is accurately projected is that of the vast majority of YTS trainees, who have found employment and also enjoyed the experience?

I am grateful to my hon. Friend for his comment. It is a little depressing that the Labour party, which used to criticise the one-year training scheme and say that it should be a two-year training scheme, still cannot find it in its heart to make anything other than sour and grudging comments when we produce fully costed proposals, make the resources available and give the scheme the priority that it needs. I would have thought that this was one issue on which the House could have united.

Will the Secretary of State admit that the numbers leaving YTS to go into work vary substantially throughout the country? In the north of England, for example, the figure can be as low as 30 per cent., and not 70 per cent. as is claimed. What will the Secretary of State do about that? What will he do in county Durham, where we cannot find sufficient employers to provide the scheme that he wishes?

The hon. Gentleman will notice that in my statement I referred to the way in which we shall fund schemes where there is a shortage of employer-based schemes. I recognise that the percentage of those who go into full-time employment varies up and down the country. That does not happen in the construction industry training board scheme. I saw some people from Durham and the north-east on an extremely successful course there, after which more than 90 per cent. find full time jobs. That variation does not occur with other training board schemes, either. We are determined to improve the chances of youngsters finding full-time work. The hon. Gentleman would be the first to say that YTS does that for youngsters. Those who have been on a scheme are much more likely to have the chance of a job.

Order. I have to bear in mind that today is an important private Members' day, but I will allow questions to continue for a further 10 minutes, making a full half hour for Back Berchers.

Will my right hon. Friend confirm that a two-year YTS has nothing to do with fiddling the figures, exploitation or any of the usual destructive criticisms made by the Opposition, and has everything to do with ensuring a constructive vocational and voluntary training scheme which will lead to high quality qualifications? Does he agree that the Treasury support of £3,800 per trainee bears interesting comparison with the £3,600 in West Germany, the only difference being that in West Germany every penny is paid by the employers? Is it not time that all employers in this country began to look on training, not as an on-cost, but as a valuable investment in their future?

As my hon. Friend has said, our financial commitment to the scheme is substantial. This development of the scheme certainly puts greater responsibility on employers, but I am confident that they will respond to the challenge. Everyone who has worked with the scheme recognises that, although there may be variations in the terms and arrangements, the scheme is here to stay. It is a major and fundamental improvement to the opportunities for young people in this country and we are determined to make it work.

I wholly welcome any expansion of the youth training scheme, which cannot guarantee employment but which makes the prospect of a job much more likely. What steps is the Minister taking to ensure that in areas of high unemployment, especially the sparsely populated areas of Scotland, where employers are most hard-pressed to find places, the Government will do their utmost to ensure that the approved training organisations are not handicapped by a lack of response from employers?

As I have said, I have agreed with my right hon. Friend the Chancellor the amount of Government resources to be made available for the scheme, but the scheme depends on a partnership with employers and other providers of training. The record so far is good. There was the great success of ensuring that we met the guarantee that every 16-year-old leaving school and wanting a place on the scheme could be offered a place. We intend to carry that forward to try to meet the needs and aspirations of all young people in this respect.

In the recent defence debate anxiety was expressed about the difficulty of finding British crews to man ships flagged out and manned by foreign crews when requisitioned in case of hostilities. Will my right hon. Friend use his good offices to try to persuade ship owners to be more constructive and to offer more YTS places? Does he agree that a year ashore and a year at sea could begin to establish a Merchant Navy reserve which could serve this country well in times of hostilities? As this will require instructors, will my right hon. Friend consider extending job release arrangements so that men with lifelong experience and skills in industry and the armed forces taking early retirement will be available to become instructors in the youth training scheme?

I have consulted the greatest living authority on the youth training scheme, my hon. Friend the Minister of State, who is sitting beside me, but neither of us can answer off the cuff in relation to merchant shipping. I shall look into the matter and write to my hon. Friend.

Does the Minister agree that 4 per cent. is a miserly increase and that the original £25 allowance was too low in the first place? How can youngsters be expected to build an independent life on £27·30? Would Conservative Members expect their children to be able to do so? Is it not true that there are no real jobs for young people at the end of the scheme?

The hon. Gentleman's last comment was a characteristic piece of rubbish and shows that he had not been listening to the earlier exchanges. The resources that we have made available and to which we have given priority are limited. It is our responsibility to determine the balance between the funds going into the value of the training and those going into the training allowance. Given that many of these youngsters' contemporaries are still in full-time education and receiving no resources at all, the balance that we have struck does not seem unfair. In the past two years we have sought to raise the allowance a little, but I think that we have struck a fair balance and that the resources that we have made available will be widely welcomed by young people.

Does my right hon. Friend agree that it is important that the schemes concentrate on practical, technical skills? Is he aware that the Tullos training centre in my constituency, which does just that, achieved a 93 per cent. success rate in finding employment for the young people last year and hopes to better that record this year? As for providing incentives to improve take-up, could not the incentive scheme be extended to the Opposition? Perhaps more of them would then turn up to debate these matters.

I was most interested to hear of my hon. Friend's experience of the scheme in his area when I was there last Saturday. There is no doubt that there are now some outstanding schemes with exceptional records, going as high as 100 per cent., in placing young people in full-time jobs. The average, however, is still not as high as we should like. The challenge that we face is to bring all the schemes up to the standard of the best.

Given that the credibility of the scheme rests on the proportion of young people who go into real jobs afterwards, will the Minister stop quoting anecdotes and minor surveys and give reliable figures about how many young people actually find jobs? As the outstanding feature in West Germany is that 10 times as many young people gain recognised qualifications, will he tell us how many young people in this country will gain recognised qualifications as a result of the scheme, and how many employers will be involved?

I am surprised at the hon. Gentleman, as I thought that the took a reasonably close and intelligent interest in these matters. We are continuing to monitor the outcome of the scheme. Figures are published every month and they are available in the Library if the hon. Gentleman wishes to consult them. We are anxious to get the fullest possible picture. As for anecdotes, I referred to the construction training board, which had about 17,000 trainees last year and a success rate of more than 90 per cent. in placing those youngsters in jobs. I do not regard that as an anecdote. It is a very significant sample.

Does my right hon. Friend agree that the qualifications available through the YTS are likely to be of greater value than the sweat shirts, teacups and other gimmickry offered by the Labour party last week? Will he do all in his power to market the value of the qualifications, so that young people are not discouraged by the utterly negative attitude of the Labour party?

One of the most exciting aspects of the scheme, on which I am not yet able to advice the House further, is the work being done to integrate the qualifications available at the end of the scheme. As I said in my statement, we aim to give all young people in the scheme the opportunity to achieve a qualification. Intensive work is being done to try to integrate the qualifications with those of the City and Guilds, the Royal Society of Arts, the Business and Technician Education Council and other qualification-granting bodies, to ensure that young people achieve the first step on the ladder which can take them on to further qualifications.

Is my right hon. Friend aware that in Lincolnshire 88 per cent. of those who were on the scheme in the first year have now found work or further training? He mentioned the quality of training in the second year. That is a good aim, but we must work extremely hard to achieve it. How will we make sure that the quality of that training really is up to a second year?

Having given my approval today to the broad framework, the detailed work will now proceed following an intensive round of discussions with all those concerned — educationists, training providers and employers — to ensure that the second year of YTS meets all our expectations.

Will my right hon. Friend dismiss, ignore and forget the disgruntled and bitter comments of the Opposition and their supporters on the extent of the scheme, which is widely welcomed by all parts of society? Does he agree that in certain sectors, such as retail, there are still substantial anxieties about the validity, content and depth of the second year? Will he ask the MSC to have discussions with the retail industry to see what will go into the second year content?

I recognise that concern has been expressed about the retail sector. A colleague commented that while in this country I can be asked whether we can justify a second year of training, if I were a German Minister I would be asked why we have fewer than three years training. One of our greatest ambitions is to get a better understanding of the value of training and to make it applicable to every activity and occupation.

The Secretary of State injected into his announcement a comment about a new training inspectorate. What will the role of that body be? Can he assure us that it will be adequately funded and staffed to monitor the approved training organisations? May I make clear to the right hon. Gentleman and all of his hon. Friends that the Labour party would welcome a fully comprehensive two-year scheme to train young people, which is not what we have had today? What has been announced today has more to do with massaging the unemployment figures prior to the next general election than with training young people.

It is difficult to choose between the hon. Gentleman's first and second contributions. That attempt somehow to retrieve some of the ground achieved by his pathetically sour initial intervention was not worth the effort. The training standards advisory service will in many ways be analogous, although not at all comparable, with Her Majesty's inspectorate in the schools. In other words, it will examine and monitor the performance of the training providers to ensure that training standards are kept up to scratch. I am sure that the hon. Gentleman will support that. If the new service is to do that, we are determined to give it the resources to do a proper job.

Business Of The House

Ordered,

That in respect of the Further Education Bill [Lords], if the Bill be committed to a Committee of the whole House, further proceedings on the Bill shall stand postponed and that as soon as the proceedings on any Money Resolution come to by the House in relation to the Bill have been concluded, this House will immediately resolve itself into a Committee on the Bill. —[Mr. Neubert]