I thank Mr. Speaker for granting me this debate.

Engineering is a subject that is close to my heart for one simple reason. Before I came to the House I was a practising engineer, and since then I have worked closely with the professional engineering bodies, as well as my own professional body, the Institution of Chemical Engineers. As Member of Parliament for a constituency in the north-east I represent a large chemical and process engineering sector, which is important for our country as well as Europe.

Today, I want to highlight the most important aspect of engineering, which will affect our future, and some of the causes for concern in the training of engineers, which pose a real threat to Britain’s excellent reputation for engineering. I also want to suggest one or two ideas for the Minister to take away if he cannot respond to them today.

Many of the national and global challenges facing us in the 21st century can be addressed only by the scientific and engineering community. Finding sustainable energy sources and reducing their impact on the environment, addressing climate change and fighting global poverty are all areas in which engineers have a huge role to play. That is why we must ensure that national and international Governments play their part in training and preparing the future work force that will build our nuclear power stations and research the new technologies that could save lives in Africa.

Engineering is crucial to our country’s economy. The strength and growth of our economy depend on new technologies. We need a work force of expert engineers to build, research and maintain those technologies. Britain and my region in the north-east have a huge role to play. Our goal should be to elevate Britain to the level of our international competitors and ensure that Britain is not merely a consumer of the new technologies but also an agenda setter.

I come to the debate as someone who strongly supports my Government. I am proud of their record in promoting science and engineering. I pay tribute to our Prime Minister and the Chancellor for setting the pace and for their support for science and engineering. The figures for financial support show that in 1998 there was a 15 per cent. increase in the budget for science, which was the largest increase in any area of Government expenditure. I am proud to say that during my lifetime I have never known a Government of any political complexion to show its commitment and to increase the budget as much as the present Government. I speak as a strong friend of the Government and champion them, but I want to raise one or two issues.

I know that the Government have set up a science and innovation framework target to increase the UK’s spending on research and development from 1.9 per cent. to 2.5 per cent. of gross domestic product by 2014. That is a tremendous challenge, but unless we ensure that enough engineers are being trained effectively in our universities to meet future demand, the UK will be left behind compared with our international competitors.

The shortage of maths and physics teachers seriously undermines the quality of secondary education in this area. That is no surprise to the Minister because the matter has been raised on the Floor of the House many times. A crucial problem is that teachers are often expected to teach subjects outside their own discipline. On average, only 19 per cent. of science teachers specialise in physics and only 25 per cent specialise in chemistry. Those shortages have become even more pronounced in schools with pupils with greater needs such as those with a higher percentage of pupils who are eligible for free school meals and those with more special needs pupils. Teachers are undoubtedly more comfortable and enthusiastic teaching the subjects that they specialise in, and that enthusiasm rubs off on pupils. Given that maths, physics and chemistry underpin engineering, that is a cause for concern among engineering professionals.

There has also been a considerable downturn in the number of those studying maths and physics at A-level. Those subjects are often required to study engineering at university and that downturn will no doubt have an adverse effect on the number of people who are able to do so. While the number of those entering university between 1994 and 2004 rose by almost 40 per cent., the number of those opting for engineering degrees remained almost static at 24,500. That was a drop from 11 per cent. to less than 8 per cent. of entrants. The Minister will say that the figures have risen as well as dropped, but those are the latest figures that I have.

The Universities and Colleges Admissions Service higher education figures reveal that applications for some engineering courses at some UK universities are down by around 25 to 30 per cent. I am thinking of electronic engineering. If that trend continues, many of the courses will disappear. What is even more worrying is that less than half of engineering graduates chose to enter the profession. How do those shortages impact on industry? The 2006 engineering skills survey by the Institution of Engineering and Technology found that nearly 35 per cent. of engineering companies did not expect to be able to recruit enough suitably qualified staff this year. The study found that senior engineers with five to 10 years’ experience are in most demand, with more than half of respondents saying that they are having trouble recruiting them. The institution suspects that that is due to engineers leaving the profession as well as to problems with graduate recruitment. The study also found that 23 per cent. of respondents were having problems in finding suitable graduates and 21 per cent. in finding qualified technicians.

If I may, I should like to refer to another survey, which was carried out by Henley management college on behalf of the Royal Academy of Engineering. The study, “Educating Engineers for the 21st century: the Industry View”, surveyed more than 400 UK engineering companies and found that companies are seeing a shortage of high-calibre UK engineering graduates and believe that they will need even more in future, which will deepen that shortage. Of those companies that responded to the industry survey 30 per cent. said that they were already seeing an impact on their company performance caused by engineering shortages. That included an impact on productivity, creativity and business growth. I need not emphasise that that is very worrying.

The survey also concluded that undergraduates are not being given appropriate experience of applying theory to real, open-ended problems. That is nothing new because when I was studying, exactly the same thing was said about us. I went on to work in industry after graduation. Nevertheless, the problem still exists and industry is still saying that. The teaching of engineering at undergraduate level needs to be overhauled to meet the needs of industry. Again, that has been said for as many years as I can remember.

However, positive messages also came out of the survey. One is that 90 per cent. of the companies employing more than 50 people have graduate training schemes, but of the companies with 250 or fewer employees, less than half have any graduate training schemes. Larger companies should be encouraged through their supply chains to support small and medium-sized enterprises and their graduate training requirements.

The Royal Academy of Engineering’s secretary for education and training, Julia King, concluded that

“action is needed now. Every day that passes is costing UK industry money in delayed product development and recruitment costs…unless skills shortages are tackled head-on Britain’s reputation for innovative engineering is at risk.”

On the whole the report was comprehensive and I hope that the Minister will look at some of the proposals and comments that I do not have time to mention now.

Another major problem that has come to my attention is that of private training providers nationally and especially in my area, the Tees valley. These organisations offer a useful and beneficial service, and often have close links with industry. They operate through franchise or partnership arrangements with colleges but cannot access capital, which is available only to colleges with direct contracts with the Learning and Skills Council, which has caused them great concern. Not only does it give them an unfair business disadvantage, but it seriously restricts the services that they can provide.

For example, the Teesside Training Enterprise has been faced with a lack of financial provision for those over 19 years of age who are not employed in engineering. Their contracts with colleges and other bodies do not offer funding to train people over the age of 19. That means that they are forced to reject 40 or 50 potential engineering trainees every year simply because of their age. Given the shortages in trained and qualified engineers, that is unacceptable and should be rectified.

The proposed introduction of the specialist diploma in engineering for 14 to 19-year-olds, which I believe will be available in some schools from 2008, has been encouraging for the engineering profession. I hope that it will succeed where the GCSE and GNVQ in engineering failed.

However, the engineering community is yet to be fully convinced that it will be a success. Given that it will run parallel to GCSEs and as an alternative to A-levels, parents and potential pupils will have serious reservations. The course must provide excellent links with industry and promise good employment prospects, or parents may see it as too much of a risk, with their children missing out on other subjects in the curriculum.

I have had lengthy discussions with representatives from industry about most of the problems I outlined earlier, and those problems recur time and again in our discussions. Some of them are more general and long term, while others, which I highlighted, such as the Teesside Training Enterprise in Tees valley, are more specific and can be addressed directly.

In order to tackle these problems, the Department for Education and Skills and the Department of Trade and Industry must seriously consider overhauling the way in which engineering is taught at every level of education. The 2006 engineering skills survey by the Institution of Engineering and Technology also asked respondents what needed to be done. The most common proposed solution was to improve engineering in the education system. Suggestions included better resources and laboratories, and more practical classes. Another common solution proposed was the need to promote engineering and technology to young people more effectively and at the earliest opportunity.

The other main suggestion focused on the need to introduce a scheme to create a uniformity of engineering qualifications across Europe. Given students’ increasing mobility, and the high numbers of students from overseas who study in our universities, engineering qualifications that apply throughout Europe would be beneficial to industry.

The value of engineering as a profession and as a central foundation of our economy should be emphasised to pupils from an early age. Engineering must become an integral part of the teaching of maths and sciences at secondary school and the national curriculum must reflect that. We must ensure that we train teachers who understand and believe in the value of engineering.

The possibility of extended school opening hours presents a great opportunity to emphasise the importance of science and engineering. Representatives from the industry could be invited into schools more regularly. However, schools need guidance and possibly funding tailored to promoting engineering and emphasising its importance.

Universities and colleges must be encouraged to develop even closer ties with industry to make their courses more relevant and reflect the needs of industry; I say that as someone who recognises the contribution that both sides have made. Twenty or 30 years ago that may not have been the case, but in the past decade there have been strong links, although we must do better.

The changes in communications over the last decade or so have been immense. Children now acquire knowledge in ways that are very different from the way that I did when I was at school: iPods, mobile phones and the internet are central to their everyday lives, but maths, science and engineering are still taught in very much the same way as they were 20 or 30 years ago. Education must reflect those changes and become more relevant and exciting.

I would like more than 50 per cent. of engineering graduates to go into the profession. Although it is good to see engineers representing their profession in other areas, as I do, the shortages can be addressed by simply maintaining students’ enthusiasm or love for their subject. The Department must encourage larger companies, through their supply chains, to support science, maths and engineering graduates and their training requirements. I hope that the Minister will consider allowing private training providers such as Teesside Training Enterprise to access funding from the Learning and Skills Council, which would allow such companies to train more potential engineers and could alleviate some of the shortages in key areas.

In conclusion, I hope that my hon. Friend the Minister for Higher Education and Lifelong Learning will meet me and members of the Royal Academy of Engineering, to explore some of the ideas that I have suggested today. I hope that by working together we can face some of the challenges ahead.

I am pleased to have this opportunity to respond to the debate. I congratulate my hon. Friend the Member for Middlesbrough, South and East Cleveland (Dr. Kumar) on securing it and raising this important subject. It is the second time in a week that he has raised these issues with me in Parliament, and I know that he takes a significant interest in them.

I want to respond to my hon. Friend in the context of the recent report by the Royal Academy of Engineering and to take up his invitation to meet him and colleagues from the academy, which I will be happy to do.

It is essential to this country’s continuing prosperity to produce the very best in science, engineering and technology research—STEM research—and to develop world-class scientists and engineers. The supply of skilled science, technology, engineering and mathematics graduates is as important today as it has ever been, which is why our priority is to stimulate and maintain student demand for engineering and related subjects. It is noteworthy that in respect of the supply and demand of STEM skills, the overall UK position is favourable according to the most recent figures available from the Organisation for Economic Co-operation and Development. There are some areas in which we are weaker, but a large stock of STEM skills and a steady flow into the labour market mean that we are well placed to take advantage of any likely growing demand in these areas.

In respect of the national picture, enrolments on undergraduate engineering courses, which, as my hon. Friend said, were in decline during the 1990s, have risen 6 per cent. since 2002. However, as he is aware, the overall increases mask increases in some areas and declines in others: for example, in 2005, entrants to general engineering courses were up by 10 per cent. and to civil or mechanical engineering by 4 per cent., but entrants to electrical engineering fell by about 8 per cent. We are most certainly not complacent, but it is encouraging that the national demand for and supply of courses is improving overall. We absolutely must keep that under review.

There are some encouraging recent signs about student demand across the STEM subjects. Overall, applications and acceptances through the Universities and Colleges Admissions Service indicate that there has recently been a higher-than-average increase of 10 per cent. or more in the number of students accepted to study maths, physics and chemistry. Previously, there had been a significant downturn, but we may be beginning to see the turn of the tide, although I do not want to over-egg it. Chemistry courses, for example, rose by more than 12 per cent. last year compared with the national average increase of 7 per cent.

My hon. Friend talked about the importance of science teaching in schools. It is significant that in the last three or four years there has been an increase in the number of science graduates going into initial teacher training. Also, when I last looked at the evidence, the proportion of graduates going into ITT with a 2:1 or a first had risen significantly, and that gives us grounds for optimism that, in the longer term, there will be higher-quality teaching in our schools.

Particularly important are the changes that we are making to the school science curriculum, in order to move away from rote learning to ensure that young people understand the processes of science. There are two other things that we need to do to stimulate and enthuse young people and engage them in science. First, and very practically, we should underline the importance of the graduate earnings premium in STEM subjects; it is about 30 per cent. compared with 23 per cent. for non-STEM subjects, so there is a significant additional earnings premium for those students who undertake those subjects. Secondly, we have to do much more through the media to present and depict science properly and positively, through newspapers, television programmes and drama. A number of initiatives are in train to ensure that that happens.

Let me say a few words about what specifically we are doing in the higher education sector. I very much take my hon. Friend’s point that we need greater collaboration between industry and the higher education sector as a whole. Foundation degrees, for example, are an important and exciting development in that area, designed, as they are, in partnership with employers to provide the specialist knowledge and employability skills that employers demand, as well as the broader understanding that equips graduates for future professional development. They not only provide a flexible and valuable entry level into higher-level engineering study, but make it accessible to people who might not otherwise have considered that route. These initiatives and qualifications address an important skills gap at the associate, professional and higher technician level identified by private and public sector employers. That is an important initiative, in terms of collaboration between industry and higher education, as is the higher education innovation fund, which works on knowledge transfer directly from higher education into industry.

It is important to ensure that the demand for engineering courses is maintained, and that there is Government funding of a number of projects to facilitate that. The Department of Trade and Industry, for example, is expanding the science and engineering ambassadors scheme, one of a number of successful schemes to encourage young people to continue science, technology, engineering and mathematics in higher education by supporting teachers and engaging and enthusing pupils. By 2007-08, the total number of ambassadors will be 18,000—an increase of 50 per cent. on the current year. That is an important and significant step forward.

The Higher Education Funding Council for England is using money from its strategic development fund to support the development of proposals from science, technology, engineering and mathematics subject areas to stimulate demand for higher education courses; that is a positive way forward. As part of that, the London engineering project, run by the Royal Academy of Engineering, brings together schools, universities and employers to engage with young people through enrichment activities in our schools. The programme is aimed at attracting new engineers from diverse backgrounds, and contributes to our goals for widening access to higher education from under-represented groups.

I am pleased that there have been proposals for funding from both the Royal Academy of Engineering and the Engineering Council UK. Projects proposed include using work experience placements to recruit young people into engineering and developing models of flexible pathways into and through higher education, leading to professional status in engineering.

Fundamentally, if we are to get an increase in demand from students for science and engineering courses in higher education, we need to take action at all levels in the education system, and most importantly, frankly, at a much earlier stage than higher education. That is why the 14-to-19 agenda is so important; we are talking about those who, at the age of 14, may arguably be switched off education and further personal development on being presented with a purely academic route. My hon. Friend is right that engineering is recognised as one of the key sectors of the economy; from 2008, it will be among the first five sectors to offer the employer-led specialist diplomas that we are developing. If we can get those diplomas right, as I believe we can, we can attract young people into that vocational pathway and into engineering in a way that we could not previously. The development of the specialised diploma is one of the most exciting opportunities of recent years to provide a strong route of mixed theoretical and practical learning for people of all abilities. As they are employer-led and designed, industry will get the people with the skills that it thinks necessary.

Schools, particularly those specialising in engineering and science, have a key role to play in encouraging young people to consider a career in engineering. The Government’s specialist schools programme plays an important part in our plans to encourage more people to study and understand engineering. There are currently 656 schools with a specialism in engineering or technology—that number is growing, and we need that trend to continue.

Science and maths in schools are typically thought of as the building blocks of engineering. The recent pledges that the Chancellor made in the Budget raised our ambitions further—rightly, in my view. Our “Science and innovation investment framework 2004-2014: next steps” document, published in March, set out clear aims for improving the stock and flow of skilled scientists, technologists, engineers and mathematicians, and set out measures across the education system to support that. To drive forward improvements to science teaching and learning, the Chancellor made a commitment to £32 million-worth of new measures over the next two years, supported by £18 million-worth of new funding.

We have new commitments: first, to increase the number of pupils achieving level 6 in science at key stage 3 and good science grades at GCSE; and secondly, to raise the number of A-level science entries and improve the percentage of teachers with physics, chemistry or mathematics as a specialism. That is a really important area. In the longer term, we want many more teachers who actually specialise in the core STEM subjects to teach them in the classroom.

My hon. Friend mentioned teacher numbers. It is worth noting that although there are still some challenges on that front, since 1997 there has been a 30 per cent. increase in the numbers of new science teachers, but we know that we still need to do more. To increase further the number of science teachers, we have improved the value of recruitment incentives. The teacher training bursary rose to £7,000 in September 2005 and will rise again to £9,000 this September. Also, the “golden hello” for new science teachers rose to £5,000 for trainees entering the postgraduate certificate of education or equivalent courses in September 2005. We are also recruiting and training a new cadre of science specialist higher-level teaching assistants and enabling every secondary school to recruit at least one by 2007-08. Those initiatives are beginning to bear fruit and are ensuring that we have more properly qualified teachers teaching science in the classroom, supported by able teaching assistants.

Furthermore, we have been encouraging science and maths students at university to consider teaching as a career, while helping to enthuse young people in the classroom through the student associates scheme. Of the 20,000 students placed in the past three years, 3,000 have been science undergraduates. The recent Budget rightly made £700,000 of new money available in each of the next two years to create more science and maths placements on that important, excellent scheme.

The engineering sector can make a vital contribution by working with the education system. Listening to employers is essential for a strong economy and a fully prepared work force. It is worth noting that engineering falls within the footprint of several sector skills councils. All are contributing to the development of foundation degrees. The Department for Education and Skills is working with the Science, Engineering and Manufacturing Technologies Alliance to support the delivery of the challenging GCSE double award in engineering, as well as the planned roll-out of the engineering diploma in 2008.

In conclusion, I reassure my hon. Friend that we take the issue extremely seriously. There are some encouraging signs at the higher education level, in terms of the numbers of students coming through, but real progress in the longer term is dependent on the changes that we are making to our schools system at the moment. If we look at the evidence, those changes are beginning to bear fruit, but I am not complacent; we need to keep driving the issue forward, and with the support of my hon. Friend I am sure that we can do that.