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National Skills Strategy

Volume 405: debated on Thursday 15 May 2003

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Motion made, and Question proposed, That this House do now adjourn.— [Mr. Woolas.]

5.30 pm

The Parliamentary Under-Secretary of State for Education and Skills
(Mr. Ivan Lewis)

I am delighted to have the opportunity to consider hon. Members' views as we reach the conclusion of our consultation on the skills White Paper, which we will publish next month.

Improving our national skills performance is at the heart of the Government's overriding mission to strengthen the country on the dual and inextricably linked foundations of social justice and economic success: strengthening social justice by giving all citizens the opportunity to fulfil their potential and know the dignity of self-improvement, and strengthening economic success because skills are a crucial lever of competitiveness and productivity. Our companies will need increasingly highly skilled workers in the competitive global marketplace. Our public services will need skilled front-line staff—managers and leaders—as they strive to offer 21st century public services.

The Government have put in place many of the key building blocks that will strengthen our skills base in the longer term: universal nursery provision and sure start in the early years; literacy and numeracy strategies in our primary schools; secondary school reform through the key stage 3 strategy and specialist status; the framework for a new and distinct 14 to 19 phase of learning; the development of the Connexions service and education maintenance allowances that will be available nationally from September 2004; a renewed commitment to modern apprenticeships; significant reform and investment agendas for further and higher education sectors; and our skills for life crusade to tackle the scandal of the 7 million adults who cannot read or write to the level expected of an average 11-year-old. We have established the Learning and Skills Council and regional development agencies to drive forward social and economic regeneration.

I am grateful to the Minister for giving way on his point about RDAs and the Learning and Skills Council. He will know that the north-east stands to gain considerably from Ministry of Defence orders for two new aircraft carriers, but it is important that the orders provide benefits that last beyond the life of the contracts. Will he pull together the RDA and the local learning and skills council in the north-east so that they can put to him a regional skills strategy for the north-east that will ensure that we have the trained people necessary for such orders and, most importantly, that we broaden, extend and improve our skills base in the region so that we can seize the opportunities that will come from those two orders?

I pay tribute to my right hon. Friend's work with employers and trade unions on the economic regeneration of the north-east. The issue that he raised underlines the importance of pilot projects on skills budgets involving RDAs and local learning and skills councils, which are designed to focus on regionally specific issues in the short, medium and longer term. I am delighted to give him the assurance that he wants. I shall ask the RDA and local LSCs in the north-east to produce a specific strategy to cope with the skills needs generated by the contracts.

Before my hon. Friend leaves that point, does he think that the relationship between RDAs and local LSCs is good enough yet? The relationship is good in my own region of Yorkshire, but I hear that it is not as joined-up as we would like in other regions. It is important that there is a close relationship between those bodies if we are to achieve what my right hon. Friend the Member for Tyneside, North (Mr. Byers) asked for.

My hon. Friend is right to be concerned about that issue, and that is why we have instituted four pilots on RDA and local LSC budgets. It is especially encouraging that even though such pilots are not being conducted formally in several regions, the good practice that is spreading means that RDAs and local LSCs in those regions are aligning their budgets more than before. There is a much more integrated and cohesive approach in each of the English regions. The pilots will move that agenda forward, but we want a far closer relationship between those two essential structures that drive both economic and social regeneration in each English region.

Just to draw out my hon. Friend a little further on the role of development agencies, after substantial job losses at Rolls-Royce, an initiative was set up in the east midlands by which a taskforce engaged trade unions and others in the use of the company's resource centres. I know that he has been approached by representatives of Rolls-Royce on the model of how it tried to redeploy and reuse skills. Is he interested in that and would he like it to be pursued on a broader basis?

Very much so. I received a delegation from Rolls-Royce positively and asked it to draw up specific proposals on how to make that model work. The days of a job for life are gone; employability for life should be our aspiration and objective now. We should increasingly pursue that policy on a region-by-region and sector-by-sector basis. We need a far more flexible approach, not a one-size-fits-all approach. I welcome that positive proposal from my hon. Friend's region.

On the building blocks of the skills agenda, it is also important to highlight the achievements of University for Industry, which has reached nearly 800,000 learners who have taken more than 1.7 million learn direct courses. In addition, the trade union learning fund has supported 28,000 people to complete a variety of courses. That will now be supported by statutory recognition of trade union learning representatives. We have also worked closely with the Department of Trade and Industry on management and leadership, which is essential for all—sectors—public, private and voluntary—to support existing leaders and to encourage and develop the leaders of the future.

As this is at least in part a consensual debate, perhaps I can assist the Minister by asking him to comment on the links between adequate levels of education and information, and good performance in the industrial relation sector. From what I have heard from industrialists, I have the strong impression that there is a much more constructive discussion with work forces that are skilled, educated and well briefed than if matters are left to megaphone diplomacy and industrial warfare.

We seek partnership in the workplace at the beginning of the 21st century. There is no need for those old divisions to exist to undermine relationships at work. We have many models of good practice whereby good employers work with active and positive trade unionists to deliver competitive companies. That has to be a two-way relationship. Employers need to implement good practice in their relationship with their employees, and trade unions need to adopt a reasonable approach to working with management to drive forward the success of companies.

We do not focus enough on the many positive examples of that in our economy. We want such practice to grow and improve. The skills strategy is an opportunity to improve and enhance the relationship between business and the trade unions. A clear and strong consensus is emerging on the importance of skills for both the success of British industry and the advancement and development of individuals, many of whom are trade union members.

The results of our unprecedented investment in, and reform of, our education system are clear for all to see. We have the best ever results at 11 and 16 and the best ever teaching, as defined by Ofsted. The reading literacy of our 10-year-olds is among the best in the world and our 15-year-olds are among the best in the world at English, maths and science. Some 320,000 adults have achieved basic skills awards. Despite that progress, we are not complacent, and there remains a considerable amount to do.

In the spirit of co-operation, every time the Minister or the Secretary of State speaks on the skills agenda, the further education sector is missed out. Some 90 per cent. of work in FE colleges inspected by Ofsted is satisfactory or better and 93 per cent. of work inspected by the adult learning inspectorate is classified as better. I wish that the Minister would occasionally give them due recognition for the huge success of the FE sector.

The hon. Gentleman should be more patient. I shall come to the further education sector in due course. I am happy to pay tribute to the work of FE. The Government have recently introduced a record level of investment into the sector. We want to raise the status and value of further education and of those who work in it. I was proud to work on the "Success for All" strategy, which has been well received in the sector. Of course there are many examples of good practice in further education, but I am sure that the sector would agree that there is also room for significant improvement. It is working with the Government to achieve that. I shall say more about FE later.

As I said, much progress has been made, but we are not complacent and there remains a great deal to do. It is essential that we bring a new cohesiveness to our approach to lifelong learning—a cross-Government strategy that will support a sustained improvement in our national skills performance. Although our economy is undoubtedly fundamentally strong, our competitiveness and productivity lag behind those of other countries. Too many individuals and employers are still being left behind.

I should say at the outset that the strategy is not about introducing lots of new initiatives. We will make changes where they need to be made, but our priority will be to join up our policies across the skills agenda and across Government. It will be a strategy owned for the first time across Government, with unprecedented co-operation now existing between the Department for Education and Skills, the Department of Trade and Industry, the Department for Work and Pensions, the Treasury and most other Government Departments. Our shared agenda on skills will be closely linked with action on innovation, enterprise and employment, focusing on the needs of employers and individual learners. To those who, understandably, are cynical about strategies, I confirm that the strategy will also be supported by a delivery plan. We will be single-minded in prioritising sustained delivery, backed up by regular review and evaluation.

Our objectives are clear: to develop a far better synergy between demand for and supply of skills; to ensure that the provider side is fit for its purpose, focused far more on the needs of individual learners and employers than in the past; and to stimulate demand from all customers, especially small and medium-sized enterprises and non-traditional learners. We need greater clarity in defining the respective responsibilities of the state, employers and individuals, and where finite Government resources should most appropriately be deployed.

The White Paper will address a number of crucial issues, first, in relation to young people. There is a consensus about the importance of creating strong, high-status vocational opportunities for 14 to 19-year-olds, leading to skilled employment directly or via higher education. The Conservatives' proposals for vocational education published this week have repeated the mistakes of the past. They present vocational education as an alternative to higher education, and attempt to sort young people into sheep and goats. That is the very reason why up till now vocational education and training has always failed in England.

The White Paper will consider employers' concerns about generic skills. We must accept that, as employers tell us, even young people leaving the education system with high-level qualifications do not have good communication, interpersonal, teamwork and problem-solving skills. The White Paper needs to address those employer concerns.

We want to support everyday dynamic relationships between schools, colleges, universities and employers. In local communities throughout the country, those educational institutions should have daily contact with employers, and vice versa, to ensure that there is a much closer relationship between what happens in the education system and the needs of the labour market.

I draw my hon. Friend's attention to the situation in Bristol. I am sure that the same is happening throughout the country. The Department and others have a huge capital programme that is being delivered on the ground. Our local authority, and, no doubt, others, are issuing contracts on the understanding that it will be local people who get jobs, so, particularly in the building industry, where that huge capital programme is being worked out, and where the local authorities and Government Departments are involved, it is possible that young people could be brought into those jobs with the asset of the colleges, schools, Connexions and LSC, which know the needs in an area and can offer the training that those young people would need to get a job. It is a case of our contracts—

Order. The hon. Lady must resume her seat. I must say that I think that she needs to hone her intervention skills. That was too long for an intervention.

Thank you, Mr. Deputy Speaker; I got the message.

The principle of using the procurement process, particularly in the public sector, to influence the ability to employ people locally and to get employers to invest in skills is a very good one indeed. We must get the right balance between training young people for the needs of the labour market and allowing them to have transferable and flexible skills by ensuring that we do not focus on training that is too job-specific. None the less, the principle is absolutely right.

We also need to give a strong and positive message about all progression routes and not only the conventional academic route. Every parent and commentator understands GCSEs, AS-levels and A-levels, but there is not the same understanding, passion, highlighting or focus in respect of the other ways in which young people can progress, achieve and succeed in the education system. That issue is about some of the messages that we send out; we need to be much clearer and stronger about the alternative ways in which young people can progress through the system.

In turning to adults, I wish to focus on both employers and individuals. On employers, we face a particular challenge in getting far more small and medium-sized enterprises to invest in skills than hitherto. We need to do a number of things to facilitate that. First, we need to create a far more simple system enabling SMEs to access training. We need to achieve a genuinely "no wrong door" approach. We have looked at the principle of having one door, but, historically, every initiative that has sought to create one door has failed, so it is far more constructive to seek a "no wrong door" approach to accessing skills and training.

We believe that it is right to make increasing use of intermediaries who work with business day to day, such as bankers, financial advisers and legal advisers, who sometimes speak in the language of business as we as politicians in the public sector cannot do. We need to use people who deal with business day to day to get the message across about the importance of skills and the best way of accessing the skills system.

We should also be using the supply chain more. That can involve larger companies doing business with smaller companies and making it a part of their contractual arrangements that the smaller companies should invest in skills. Even some of the larger companies are now willing to help to train more people than they need so that their sector is strengthened overall. I am delighted that the director general of the CBI recently said that he believes that some of the larger companies should make much greater use of the supply chain in influencing investment in skills and training.

In responding to my right hon. Friend the Member for Tyneside, North (Mr. Byers), I referred to the regional development agencies and learning and skills pilots, which I think will be very important. We need to respond to employers' concerns about lack of flexibility in the current qualifications framework. Employers need a much greater input in the design content and assessment of our qualifications. I am delighted to report to the House that, for the first time, the Learning and Skills Council, the Sector Skills Development Agency and the Qualifications and Curriculum Authority are working together to create a far more employer-friendly and flexible qualifications system.

We need to build on fiscal incentives such as the employer training pilots and employer learning accounts, which are focused on small and medium-sized enterprises in particular. We are developing the sector skills council network to replace the national training organisations. In response to some of the cynicism and concern about the pace of progress on the roll-out of sector skills councils, I point out that, in the White Paper, we will publish a clear time scale for the introduction of the councils and the coverage of a vast proportion of the UK work force. We will therefore be able to respond to concern about the time involved by making it clear how the new network will roll out in the next two to three years.

I was pleased to hear my hon. Friend's positive remarks about the employer training pilots. Will he tell us when they will be evaluated and whether that is likely to happen in time for publication of the skills strategy? Are we likely to see an extension of the pilots in the strategy at the end of June?

As a consequence of the evaluation of the six initial employer training pilots, we are extending them to create another six. They will now run in a total of 12 local learning and skills council areas, providing free training and subsidies to enable employers to give their workers time off to train up to level 2. Realistically, it would be difficult to evaluate by the end of June pilots that are only just beginning. We occasionally roll out programmes before we have the evaluation evidence, but having rolled out six—now 12—we shall examine them closely to inform future policy development.

The Minister cannot get away from the fact that there are only two. Employers are asking when they will all be up and running, because for too long they have not known what the future will be.

My hon. Friend was sceptical about the publication of the skills strategy in June, but I have been able to confirm today that that will happen. Likewise, I can reassure him that his question will be answered in the White Paper, which will include a clear timetable for the roll-out of sector skills councils over the next two to three years. That will answer those who have raised legitimate concerns about the amount of time that it is taking. I have been very supportive of the desire of the Sector Skills Development Agency to ensure that the new councils are not merely re-badged national training organisations. If that were to happen, the initiative would be completely wasted.

Moving on from employers to individuals, my hon. Friend the Member for Huddersfield (Mr. Sheerman) will be pleased to hear that we will announce a successor scheme to the individual learning account scheme, which will be designed to maintain the best principles that underpinned ILAs. We accept that the implementation and delivery of ILAs went terribly wrong, and we have expressed that regret on a number of occasions, but we still believe that the basic principles that underpinned ILAs then are as relevant now, and it is important that we introduce a successor scheme that maintains those principles.

We shall develop the role of the union learning fund, which has been incredibly successful, especially in getting back learners who dropped out of education and training many years ago.

We shall say more about an unprecedented level of investment in prison education and training. That investment has not received enough attention in this House or outside. We are putting more money into prison education and training over the next few years than has ever been put in. Almost the best crime-fighting policy that one can have is to give people basic skills, at minimum, or even higher-level skills. It is then far more likely that they will leave custody and not be part of the rotating door group who are the main reason why our prisons continue to overflow. As a society, we need to create a new approach whereby we give offenders opportunities to take a different course, and education is central to our capacity to do that.

We need to focus on benefit recipients. Although we have the highest employment in living memory, we need to be much better at giving people who remain close to the labour market the skills that will enable them to make the final jump into work. We also need to consider the economically inactive who are almost permanently on benefit. It is difficult to imagine them going straight from benefit into work.

Is my hon. Friend giving serious consideration to the proposal put forward by the Foyers Federation for a further education maintenance allowance for young people in foyers, especially 19 to 30-year-olds, who are caught in a trap?

We intend to elaborate in the White Paper on our plans for a further education maintenance allowance. It is difficult to imagine that we will be able to roll that out as a national entitlement, but we need to get on with the job of introducing the principle of such allowances, with a view to their becoming permanent in due course.

We need to be clear about the distinct and important role played in the skills strategy by adult and community learning. We need to be much clearer about its contribution, the way in which we intend to support it and how it will fit in with some of the other investment in skills, education and training. I assure hon. Members that we remain committed to the principles that underpin adult and community learning.

I am pleased to hear those remarks. My hon. Friend has not yet mentioned retired people. Given the rapid increase in life expectancy, does he accept that it is important for those who are retired to develop skills to improve their quality of life?

Order. Before the Under-Secretary replies, I remind hon. Members that we have only a limited time for the debate, which has to end at 7 pm. Since several hon. Members want to contribute, perhaps everyone would bear that in mind.

Thank you, Mr. Deputy Speaker. I agree with my hon. Friend the Member for Bury, North (Mr. Chaytor) that the ability to continue learning and developing skills is an important element of quality of life, especially for older people. The skills White Paper, which is published next month, will reflect that.

We need a much clearer message about the value and importance of learning to individuals. It must be about quality of life and earning potential. So many agencies are trying to promote learning that the message is often diluted by the time it reaches people, especially those who are not currently engaged in learning. We need to be much better at sending clear messages to them.

The skills strategy will try to create a position whereby policy decisions and funding mechanisms fulfil appropriate national targets but are sufficiently flexible to allow us to respond to the needs of regions and individual sectors. One of the great challenges is ensuring clear national objectives—we are elected to provide them—and sufficient flexibility in policy and resources to enable a focus on the needs of individual sectors, regions and sub-regions. The White Paper must tackle that.

The White Paper that we publish next month will deal with many of the fundamental issues that I have outlined. It will respond to the challenges and opportunities of the 21st century knowledge economy. We will continue our mission to enshrine a culture of lifelong learning in citizens' and employers' everyday lives. For the first time, we shall create a cohesive, cross- Government policy and financial framework to support the learning revolution that we are beginning to unleash in every community in every part of the country. I look forward to considering hon. Members' ideas and views during the debate.

5.58 pm

Events this afternoon resembled an acted parable on the national attitude to skills development. A major and important statement on the same day as an Opposition Day debate inevitably meant that more politically salient matters have squeezed our important debate. However, I acknowledge that the Under-Secretary has spoken in a tone, reflected in the consultation document, that encourages the development of at least an understanding and consensus on a national skills strategy, and I have no objection to that. We shall consider it fairly on its merits.

My only reservation about the concept is that my experience of Government has shown that, from time to time, Ministers put together a rag-bag of different initiatives, badge them as a strategy and try to place everything under the same heading. That does not always work without a coherent driver. However, we shall wait and see. I say in the gentlest possible terms that I hope that the Under-Secretary will acknowledge that our party's statement on higher education this week was not intended to drive a wedge between that and further education. I assure him that as he introduces proposals for his strategy, we shall have much more to say about skills and further education.

It should be a matter of consensus that since anxiety first surfaced in the 1880s about the decline in British manufacturing pre-eminence vis-à-vis Germany and the USA, our culture has somehow turned its back on skills and—arguably more widely—on manufacturing and commerce in general. I note that the TUC, in its briefing for this debate, emphasises the need for

"a fundamental cultural change in the skills policy framework".
That is perfectly acceptable.