Motion to Take Note
My Lords, I am very pleased to speak to the report of the Youth Unemployment Committee, Skills for Every Young Person. It is some 210 pages long and contains 88 conclusions and recommendations. I thank the staff who supported the committee: Simon Keal, our clerk, Francesca Crossley, our policy analyst, and Abdullah Ahmad, our operations officer. I also thank our specialist advisers, Dr Kathleen Henehan from the Resolution Foundation and Oliver Newton from the Edge Foundation.
I thank the noble Lord, Lord Baker, for enabling the Youth Unemployment Committee to be created at a time when there were serious worries about the impact of Covid on young people. There are long-term consequences of Covid, which are affecting many young people. I thank the members of the committee for their work over nine months during the Covid lockdown, when we met mostly by Zoom and Teams. I thank those speaking today, who will add their own experiences and insight to our work during this debate.
On behalf of the committee, I thank all the many people who submitted evidence to us or attended as witnesses: all the school, academy and college leaders, employers, charities, academics and, of course, young people themselves. It was of fundamental importance to us to listen directly to young people. Thanks must go to the noble Baroness, Lady Newlove, for facilitating our listening engagement with young people in Bolton and south-east Lancashire, to the right reverend Prelate the Bishop of Derby for facilitating a similar listening engagement in the east Midlands and to the noble Lord, Lord Woolley of Woodford, for facilitating our listening engagement in London with young people from ethnic-minority backgrounds. This approach proved highly rewarding and played a major part in developing the thinking of the committee.
There has been a long delay of a year in holding this debate, but it has the advantage of being held with a new set of Ministers at the helm. The Prime Minister has put education at the centre of unlocking growth, and it is reported that the Government will attempt to boost growth through investment in training and end the long-standing bias towards academic rather than technical qualifications. Skills are the bedrock of a thriving labour market. We heard again and again that there is a serious mismatch between the skills young people develop in school and college today and those that the future economy will need. This is caused by two key issues.
First, the developing economy has new sectors and jobs—in the green sector and the digital sector, where there is growth in cyber and artificial intelligence. At the same time, existing sectors such as social care are struggling to fill posts. To tackle this, we recommended that the Government develop a long-term national plan for anticipating and addressing skills mismatches.
Secondly, we heard from employers that when students leave school, many do not have the skills they need to find work. The school system is characterised by a national curriculum focused on academic subjects and written exams. This is not helping young people develop or showcase other skills that we need, such as teamwork, communication, creativity or problem solving. Equally, although careers guidance has improved, it is still not being taught uniformly and is not being supported by quality work experience provision. This means that too many young people are not aware of the skills they need to get into a new, growing sector.
Therefore, we recommended that the Government must recalibrate the compulsory components of the national curriculum and performance measures, putting skills at their heart. Digital and creative subjects such as design and technology are seen as less important than other subjects in the Government’s EBacc measure, while essential skills such as oracy, teamwork, and problem solving are not being tested because of the focus on the academic. I was very disappointed to read in the press last week of suggestions that design and technology may continue to decline because of the poor funding situation of many schools. This must be avoided.
We were disappointed by the Government’s response to our report, in which they argued that they do not see a need for curriculum reform. I am confident that the committee is right and that what we have said reflects the general view outside Whitehall and Westminster.
As an example, the president of the Royal Society in a letter to the Times on 28 October said:
“While preparing people for the workplace is not the sole aim of education, if it is failing to do this, it is failing young people and the economy. For too long we have allowed academic snobbery to make vocational education the poor relation and laughed off a lack of maths skills.”
This strikes a chord with our recommendations 82 to 87 on the national curriculum.
On a more positive note, we were pleased to hear that the Government will produce better, more accessible information on skills. The publication of data from the Skills and Productivity Board and the creation of a new Unit for Future Skills is welcome. We still believe that more should be done to facilitate careers guidance in primary schools; it is where individual career decisions start to be made.
While youth unemployment has fallen from its pandemic peak, it remains higher than in several comparable global economies. Although we have seen a fall in the number of young people not in employment, education or training since mid-2020, the recent estimate of over 600,000 young people in this category is simply far too high at a time when we have 500,000 job vacancies across the United Kingdom. This problem is exacerbated by past and present Governments under- funding and undervaluing further education in comparison with the university route, as well as there not being enough apprenticeship opportunities for young people who want to do them, and the apprenticeship levy not being focused primarily on young people.
Young people who are disadvantaged are still not receiving the support that they need—we talk in chapter 6 of the issues that the lack of support creates for those groups. We said that to tackle disadvantage as a barrier to work, we must ensure that all young people—especially the most disadvantaged, including those with additional needs, those in care and those in custody—have access to quality careers advice from primary school age onwards and a strong work experience offer. It became clear to us that more disability employment advisers are needed.
We called for a new education and workplace race equality strategy that tackles discrimination and unequal opportunities. I draw particular attention to recommendations 59 and 60 about young people from ethnic minority backgrounds, who still face barriers. That strategy would focus on collecting data and proposing targeted support programmes. I know that the Government said that they did not feel such a race equality strategy was necessary at this time; nevertheless, they committed to monitoring our recommendations and addressing any concerns. I strongly hope that they will do so.
We heard a lot of evidence about progression routes needing to be available so that those starting a course know what they should move on to do next. The biggest example of that was Kickstart, where there was no clear progression route following taking part in the course. We were told that we needed better promotion of careers and apprenticeships in schools and that there was a need for rigorous enforcement of the Baker clause to ensure parity of esteem for technical and academic routes. We were told, too, that there was a need for a careers guidance guarantee that would enable every disadvantaged young person to have access to one-to-one careers guidance, as well as a need for a constant review of the real impact of careers hubs and the Careers & Enterprise Company on individual schools and colleges and a continuous review of T-levels to ensure their availability in all parts of the country. We were impressed by the potential for the use of the UCAS system to include apprenticeships using local platforms. We thought that there was a need for a lifetime skills guarantee to apply to qualifications below level 3, and also concluded that we had to strengthen digital skills at all levels.
That takes me on to say that I welcome the appointment of Gillian Keegan MP as Secretary of State for Education. She gave evidence to our committee on 13 July 2021, when she was Minister for Apprenticeships and Skills at the Department for Education. She said that she was the first apprentice who had held that role and that she was passionate about apprenticeships because it was a life-changing experience for her. She also said:
“There has always been a disconnect between the education system and employers. That has possibly accelerated in the last 20 years or so, as we have really entered the digital age … That is why the careers hubs are important, because that is working with real businesses.”
Reading that again, and the transcript of what she said to our committee 18 months ago, it seems that there is now huge potential for a change of government direction towards technical education and apprenticeships.
Finally, I draw attention to recent evidence on apprenticeships from the Learning and Work Institute. What I am about to say came in an email from the institute, so these are its words: “Research on apprenticeship outcomes shows that nearly half—47%—of the 2,500 apprentices surveyed dropped out of the training before completion. A lack of support from apprentice employers—37%—or tutor—26%—was the most common reason for non-completion, but reasons also included poor programme organisation—32%—or teaching quality—24%. Those who did not complete their apprenticeships were much less likely to find a permanent job or promotion. It is particularly important that young people at risk of becoming NEET have access to high quality apprenticeships, and steps are taken to address non-completion.” I guess the Minister will be aware of these figures, but they are important to consider so that we understand what action can be taken to alleviate the concerns that have been raised. The Learning and Work Institute also draws attention to the fact that the number of people starting apprenticeships is declining, mirroring not a decline in interest but rather in opportunities available.
Last but not least, the committee called for a new, independent young people’s commissioner to be the voice of our young people. We noted split responsibilities across several ministerial portfolios for the support of young people. We concluded that this split was unhelpful, that it is essential to avoid silos and silo working and that a young people’s commissioner would focus attention on the interests of young people directly in making representations to the Government. I hope that further thought will be given to that because there are other commissioners for other age groups, and it seems that the focused attention of a commission on young people specifically would help to bridge some of the gaps that we identified between Ministers and departments in Whitehall.
I want to borrow something that my noble friend Lord Storey said in one of our meetings. How will we know when we have succeeded with this task of encouraging apprenticeships and greater technical education? We will know when secondary schools have banners on their railings that do not talk just of their Ofsted rating or the number of GCSEs and A-levels they have secured but will also tell the public how many apprenticeships they have produced for young people. I beg to move.
My Lords, first, I congratulate the noble Lord, Lord Shipley, on being the brilliant chair of this committee. We heard a huge volume of evidence, and for him to marshal it and for us to hear and discuss it was quite remarkable.
This is a radical report, and I do not expect the Government to welcome it at all. I cannot anticipate what the Minister is going to say, but the attitude of the Department for Education to all change is now totally negative. In the last year, there have been six major reports, of which this is one. The first was from the High Mistress of St Paul’s School a year ago. It was a huge survey of 800 people, including from the public sector. She came to the conclusion that the curriculum was not fit for purpose, and nor were GCSEs. She was told—not by a Minister but by the Permanent Secretary at the department—“Forget it, we’re not going to change anything”.
A fortnight ago, we had a debate on the report from the Times Education Commission. The Minister made it quite clear that the Government were going to bin that as well. Again, the report recommended substantial changes in our curriculum. So I do not expect that the Minister tonight will accept any of the 88 recommendations that we have made—and certainly not the most important ones.
Some of the most important ones centre on the curriculum. The evidence we heard from industrialists, big and small, was that it is not suited for purpose because too many youngsters at 18 leave with no employability skills at all—none whatever. By “employability skills” they mean an experience of working on teams. That does not happen in the present curriculum. Experience of collaborative problem-solving does not happen in the present curriculum. Having really good communication skills—“oratory”, as it is called—is not taught in our present system, either. This was the absolutely overwhelming weight of evidence and, quite frankly, the Department for Education does not listen at all.
Nissan, one of the largest car manufacturers in our country, said that design technology should be a compulsory subject—but no chance at all. The Government over the last 12 years have presided over a decline in design technology of 80%—it is absolutely unbelievable. What is more, over the past 12 years they have cut technical education by 20%. They are not interested in it at all. The Department for Education is preoccupied solely with academic subjects.
We took a lot of evidence on data skills. The actual curriculum the Government are following is word for word what was published in 1904 in the Edwardian age: exactly the same subjects as 150 years ago. Well, the Minister might recall that 150 years ago, a man with a red flag would have to walk in front of a car. We have moved on from that now and, quite frankly, the Government should recognise that artificial intelligence is the gold rush of this century—and artificial intelligence is embedded in data skills. So will the Minister accept our recommendation that all primary schools should have coding clubs—all, not some? Every student should have the right to a computer—not just some but every single one.
When it comes to secondary education, does the Minister realise that, compared with 2016, 40% less computing is being taught in our schools? It really is extraordinary. We recommended that computing, which means not just coding but virtual reality, cybersecurity and artificial intelligence, should be taught from 11, as soon as possible. I do not expect she is going to accept that tonight, but it is in fact what we ought to do. This is the age in which we are living, and the department is digging in again and again.
The actual problem we have had is that, since 2010, we have been subjected to the theory of an American educator called Hirsch, who says that if you just give to those disadvantaged children academic subjects, they will flourish and expand and all the rest of it. Well, that has failed: we have been the test bed. There is no other country that has followed Hirsch and no state in America that has followed Hirsch, but we have been the test bed and the programme has failed. Today, there are as many disadvantaged students—300,000—as there were in 2010. There has been no real improvement whatever. So what is the result? We have job vacancies. Which department is responsible for job vacancies? It is the Department for Education, because it has not provided what industry and commerce need in the youngsters they are going to employ.
Therefore, we are on the edge of a major change, because the volume of opinion is now building up. The membership of our committee was not a group of eccentric amateurs; it included two ex-Secretaries of State, a former Director-General of the BBC, and the noble Lord, Lord Woolley, who is the greatest advocate in this country of improving the education of black, Asian and minority interest students.
Again, we had recommendations on this—we had recommendations on work experience, but the Government want to phase out work experience. They passed legislation in 2016 to try to restrict the number of people going on work experience from ages 14 to 16. This is so much against what is needed in our country.
This report is radical, and I was proud to be a member of the committee that produced it, but this is not just a single matter. A volume of opinion is now growing. I am very glad to see that the Labour Party is seriously going to consider fundamental educational reform. I can see noble Lords nodding. I hope that my party will also embrace that, and I will do everything I can to support it. We have to bring skills back into education, where they have not been for a very long time.
Are there grounds for hope? Yes, I think there are. The new Secretary of State for Education is the first since 1870 to have been an apprentice. I therefore think that she will be sympathetic to many of the proposals in this report. The Prime Minister, in a briefing from No. 10 to the Times newspaper, said that education was a silver bullet. I hope we might have some indication of the silver bullet tonight. I doubt that we will, but there we are.
I ask the noble Lord please not to worry about the time I am taking. He should just listen to what I am saying—he will learn something.
I hope that in addition, we will tonight have some evidence of what the silver bullet is—or will it just be a defence of the status quo? The status quo has failed on an absolutely massive scale. Youth unemployment is at 9%. By the way, when we, a committee looking into youth unemployment, asked the Minister and the senior civil servant who appeared before us what was the level of youth unemployment, neither of them knew. It is at 9% but in the depressed areas of our country, such as in Walsall, Stoke-on-Trent and Blyth, it is as high as 20%. I therefore hope that we will see a considerable change.
I conclude by saying that I was very interested to see that the Chancellor of the Exchequer in his speech last week has appointed an assistant, who I know very well, to be his adviser on education. That is clearly an indication that he will not expect very original ideas to emerge from the Department for Education. I wanted to end on a note of optimism, and that is as optimistic as I can be.
My Lords, it is always a pleasure to follow the noble Lord, Lord Baker, because in many ways he always allows me to act as good cop. I remind your Lordships of my educational interests in the register, and I very much endorse the thanks given to the noble Lord, Lord Shipley, his committee and to all the staff who worked on this excellent report.
Back in 2009—which these days is prehistory—I was appointed the Minister of State attending Cabinet for Education and Welfare Reform. That was the title, but it was clear that Gordon Brown as Prime Minister basically wanted me to be the Minister for youth unemployment. It was post crash and he, like many of us, was concerned about the scarring effect of long-term unemployment on young people. When I arrived, the Permanent Secretary said to me, “It is inevitable that youth unemployment will continue to rise. You’ve got to face up to the fact that those scarring effects and social problems are just going to happen.” I am happy to say that we managed to get youth unemployment down during the time I was there, from 664,000 to 625,000; it did not do us any good in the election, but there you go. That was thanks to the Future Jobs Fund, which was then imitated in a much paler form by Kickstart when the Covid crisis then hit. However, I will not get bogged down in the detail comparing them and why I think the Future Jobs Fund was a much better scheme.
The reason why I wanted to recall all that is because it was quite a culture shock going into that job, having been Schools Minister for three years. I had been trotting out the rhetoric about how brilliant all our schools were and what a great job we were doing, and then I saw and met the young people who were at the wrong end of the school system and had not been well served by it. As Schools Minister, I was the Minister who made being NEET technically illegal because I conceived of and took through the legislation to raise the participation age to 18. Indeed, that was a success statistically, in that we moved from 15% NEET down to 10% NEET in that time, but the reality for the minority who continue to be failed by our school system is pretty bleak. The noble Lord, Lord Baker, underscored that.
This report goes to the right things: the skills gap and the school curriculum. I agree with the noble Lord, Lord Baker, about the curriculum, the need for a much better, all-age careers service, fully staffed by proper professionals who can help people of every age, the need for FE funding and apprenticeships for young people in particular and the problem of Whitehall silos. When I was at DWP I was trying to work with the Skills Minister, who I got on really well with. We both wanted to join up the skills system and the unemployment support system, yet the silos of Whitehall frustrated us.
It is really important that the recommendations in this report are listened to by government, but I will use the remaining time I have to say that I also want to see a mindset change. The reason why we wanted to raise the participation age was to create a mindset change which said that it is intolerable that there are people not in education, employment or training at the ages of 16 to 19. My 11 year-old at home, who has just started year 7 this term, will leave statutory education in 2030. She will then probably have a working life of 50 to 60 years, so she will be in the labour market until something like 2080 or 2090. We have to think about whether, in the remainder of her secondary school experience that she has already started, we are preparing her for the way the world—her world—will change between now and 2090.
We have to think about the need for a greener economy and the sorts of green growth and investment that has just been talked about in the previous debate in this Room. We have to think about STEM skills, but also the craft skills for a retrofit economy, which in many ways is what we need in order to make existing resources go further.
AI machines will be doing much more of the work during the rest of this century, which means we need an education system that helps my daughter compete as a better human, not as a better machine. The danger of our current curriculum is that it is training our children to be machines that will be outcompeted by better machines. We need to be more human, more caring and more curious. We will have an ageing population during our lifetime which simply cannot afford to carry a large number of young people who become long-term unemployed and a drain on the welfare state.
We need to start from there—from a vision of what sort of world this century will create for the people who are currently in school—and work backwards. What will the adult skill system be like? Will it allow people to constantly retrain, change careers and have a proper love of learning and ability to self-direct their learning? What changes do we need in our higher and further education systems so that they work better together in all parts of the country, not just in those where the universities are currently located?
What are the qualification and curriculum needs? I recently went into an E-ACT school in Daventry with a motor vehicle workshop. I asked about the qualifications that are being studied, and none of them include a specification for hybrid cars. Yet, as we just heard in the previous debate, we will not be selling internal combustion engine cars by the time the kids working on those cars enter the labour market. It is shocking that we do not have a skill system that anticipates the future. It looks at what we might need now and the skills gaps now, and tries to fill those with qualifications, but that is inadequate. We need now to be looking to a much more dynamic, future-looking, whole-system change, so that we can urgently achieve the green growth and the much more human-centred society that this country, including my 11 year-old at home, is growing up into.
My Lords, when I first decided to look at the report and speak on it, I was struck by the fact that many of us who had been looking at this field and at education had been agreeing with it for quite a long time. We had been agreeing with its general thrust that further education and technical skills have been seen as a second-class option by an education system that is dominated—I forget which noble Lord said this; it might have been the noble Lord, Lord Knight—by an objective to get everybody to Oxford—Cambridge will do. It is a process of acquiring exams, getting them rubber stamped and going through. This is the culture of our education system because it is led by graduates and that is where they want to go. We all know that what is normal is what we did.
We must shift culturally from that, but that it is very difficult to do. The Government inherited a situation where they are trying to do this, but they have discovered not only is that what we do not need for our economy because only a limited number of graduates are needed, especially at higher levels, but that certain people cannot join in with that process culturally or because of special educational needs. The Minister will have been expecting me to say that. When she answers, will she tell us when we will finally get the Government’s response? Last time, she said that it would be December—that is next week. Will it be next week? Will it be before Christmas? That will colour quite a lot of what we are saying because large sections of those who are failing and cannot get into certain universities are in the special educational needs categories or they are factors in their personal cocktail of circumstances which often hold them back from succeeding. If they cannot pass those GCSEs by which we are so keen on defining the success of a school, how are we going to make sure that they carry on? The incentive in the past two years to offload has been absolutely there, and that is why we have such a high number of children who are not in school. If it is not the only reason, it is a factor.
Something else I gathered from this report and by talking to other people is that a key skill is probably not passing that English exam but using a computer efficiently. I remind the Committee of my declared interests in dyslexia and technology. Schools also allow you, bizarrely, to nullify some of those disadvantages—say, if you have dyslexia—of not acquiring those skills that most people have of being able to read and write quite easily. It is actually so commonly available now that there is a shift towards teaching people to use a standard package of technology, rather than putting additional technology on, but you have to use it and you have to get the classroom to use it. It would be a way of allowing more people to acquire a new key set of skills.
Everybody seems to agree on the committee—it is in the committee’s findings—on the fact that that is your new key set of skills. But if you are not going to encourage people to do this by saying that this is what you should be doing now, encouraging them to go and learn other skills, and then insisting that you have to get that 1960s grammar school-type approach to education—that you have to have X number of ticks to get through—you are going to continue to make it difficult to get these groups in, denying the initial stage of entrance to these processes. I have a long history when it comes to apprenticeships. If you are going to allow them in, even if you allow them to take the course, they cannot finish it. I know that there have been changes, some of which I helped to initiate, a long time ago, but I have heard that it is more observed in the breach than in the practice. But that is a battle for another day.
If the Government are not going to accept that radical change needs to take place in our exam system, we will continue to get the same results. We will continue to get an Education Department that is constantly talking about people retaking courses—people who are not achieving and who have not achieved at school—in something that most people do fairly easily. If we are going to carry on doing this, we are not allowing them to go on to further training, and we are effectively writing them off—that is, if they have not already taken themselves away. These factors are accentuated by their background: if they come from a family where everybody has failed exams, they will say, “I’m not going to be different from my folks”, and they will continue to do it.
How do we break this pattern? The only way in which we will start to dent this outside the curriculum is to make sure that there is better careers advice, which gets to the homes of these pupils. If you manage to sell it to the parents, the child may listen. How we do that interaction with the parents will always be difficult, but that is the key structure. It is about making sure that any child says something to the parents and the parents say, “Yes, we’ll buy in”. At the moment, careers advice is that you should work terribly hard, get on with the process and get your degree—but we have excluded hundreds of thousands of people before you have started, because it is not something that they are attuned to. If we make that path more open, which means far more emphasis on further education than we have now, we stand a chance of affecting it.
We need a huge cultural shift, as well as a technical one. Unless we start to embrace that with an aggressive attitude, we will never get there—because the status quo is the status quo because of the fact that people do not like to change.
My Lords, the noble Lord, Lord Baker, called for bringing skills back into education, and I shall attempt to present a bridge to that end. Before doing so, I fully sympathise with the frustration of the noble Lord, Lord Knight, with silos—a culture that needs urgent dismantling. Being holistic is the key word for going forward, generally through everything in life and particularly in relation to the UK’s management of itself.
I have happily slept-walked into a sector of critical importance to the United Kingdom—namely, the future of the UK’s freight and logistics, for which I serve as co-chair to the parliamentary group. This is to be a strategic evaluation by region, then analysed nationally by modal, by non-conflicted persons in an evaluation for decades to come. Skills and training are crucial, so I welcome this opportunity to draw attention to the opportunity that the sector presents as a career path for the youth of today.
As background, logistics is a large and growing industry across the UK, employing 2.56 million people, either directly or indirectly, accounting for 8% of the workforce. Top employers, of which 11 are pure logistics companies, include world-class players such as DHL Express, Wincanton and CEVA Logistics. Employment has nearly doubled since 2012, outpacing the rest of the UK economy and accounting for 8% of the workforce, contributing £139 billion gross value to the UK economy. A helpful independent report by Frontier Economics, supported by Logistics UK, has looked at the economic, social and environmental impact of the logistics industry, with findings based on a combination of quantitative and qualitative analysis.
A recent school career leaders presentation has challenged current perceptions about logistics roles as presenting an open career structure with the least number of managers with degrees. Some 30% of all roles advertised in the south-east Midlands are for logistics roles, of which one-third are above £30,000, well above the national average. A range of growth forecasts shows that we could be looking at creating 25,000 new jobs over the next 15 to 20 years in the warehousing sector alone.
All this brings me full circle to the report before us this afternoon. Logistics provides opportunities for people who may not otherwise be in work. An independent survey indicates that 20% of people currently in logistics were previously unemployed, of whom one in four was long-term unemployed. Almost two-thirds—62%—of logistics managers do not have a university degree.
There is, however, a call for reform of the apprenticeship levy so that funds can be spent on alternative training and qualifications. Issues raised as barriers to using apprenticeships typically include the 12-month minimum duration and the 20% off-the-job training requirement—in other words, one day per week spent training. It is suggested that they do not get as much out of the levy as they put in, which is supported by the fact that, during the financial year 2019-20, only 15% of apprenticeship levy-paying employers fully utilised the funds available to them. A skills levy, as opposed to an apprenticeship levy, would help to bridge the gap between shortages and skill acquisition. The apprenticeship levy—although originally hailed as a mechanism to link young people wanting a solid start to their career with businesses that needed next-generation knowledge, skills, and behaviours—has not reached the desired target audience.
It should be underlined that truck drivers and other vehicle operators currently struggle with the rigidity of the apprenticeship framework and could recruit and train more people more quickly if it were reformed into a skills levy. As an example, there is a heavy goods vehicle apprenticeship standard; it takes 14 months to complete, but the drivers have their licences in six months. Most employers continue to train their own drivers to their specific standards and work practices long after they have passed their tests, meaning that the continued requirement for individuals to attend college once a week is rather redundant.
While advanced and higher-level apprenticeships are important in professional development planning and for retention, with young people having an appetite to learn and businesses having a need for talent, the pipeline that joins them seems at present not to be sufficiently accessible for logistics and transport. Simplifying offerings and making more of portable modules would go some way to rectify those challenges. Thinking creatively, outside of formal qualifications, could lead to accredited modular learning that could then, if desired, lead to a qualification later. This is particularly important when considering the lean margins of the sector. If qualifications are to be company funded outside the levy for smaller organisations, a lack of return on investment could cause setbacks to future investment.
The propensity to put qualifications on a pedestal over on-the-job learning needs to be revisited to prevent the alienation of those looking to progress. Accredited training is a viable option as an alternative to more traditional qualifications for immediate return on investment to support those who want to pursue a career in the transport sector with businesses that desperately need those skills in their workforce. The Assured Skills Academies in Northern Ireland provide an interesting blueprint.
Generation Logistics is initially a 12-month programme of engagement and promotional activities that aims to bring the industry together, shift perceptions and encourage the next generation of logistics workers to engage with available opportunities. Generation Logistics’ campaigns are centred around increasing the diversity of the sector, ensuring that, when people across all demographics view Generation Logistics material, they see themselves reflected.
Addressing the aspiration gap is also key, profiling the managerial jobs that many will be unaware exist in the sector and so dismiss a career in logistics as not being one that matches their ambitions. Promoting the diversity of opportunities should support inclusion, noting the range of opportunities that are available that focus on certain knowledge, skills and behaviours, not on background, race or gender.
There is a danger, when considering the promotion of the profession, that only the more attractive side is shown to target audiences: robotics, driverless technology and more. However, it is critical to strike a balance to ensure that the sector not only recruits, but retains, new talent. Demystifying the sector, in addition to commonly held myth, is perhaps an attraction strategy better rooted in the everyday roles the sector is crying out to fill. Re-education, such as promoting the benefits of shift work as flexible, rather than undesirable, makes for interesting campaigns for both young people and career changers alike.
To change this perception, those working in logistics, transport and supply chain operations must be positioned as practitioners and professionals against benchmarked standards. Young people cannot be what they cannot see, and logistics is the very definition of a hidden industry, operating behind closed doors and yet keeping the United Kingdom moving. A national campaign to promote the logistics profession to underrepresented groups is being spearheaded by Generation Logistics, supported by the Department for Transport, and is aiming to address the negative perceptions of the sector and promote the availability of attractive, fulfilling jobs at all levels.
My Lords, I am someone who often goes over and tests the patience of the House. I thank the noble Lord and the members of the committee for enabling us to participate in this discussion. It is an incredible report and everywhere I touched, I wanted to read more, but I confess that I have not finished it. I want to refrain from detailing statistics as noble Lords are all too conversant about the level of disparities in Newham, Barking and Dagenham, Brent and, indeed, Tower Hamlets, which are the areas I want to concentrate on, as a result of the significant effect of the lack of opportunities for young people to be meaningfully engaged in education, jobs and training,
I wish to raise two points particularly about Tower Hamlets and more generally on the impending explosion of emerging technologies and our unpreparedness to ensure that a generation of young people profit from opportunities and to consider how we mitigate the gaps which are profoundly highlighted in this report. Tower Hamlets’ young people are encircled within Canary Wharf, Broadgate and the City of London, where the majority of employees commute long distances for work. For the citizens of places such as Tower Hamlets, employment prospects remain at the periphery of hospitality or the food and catering sector. Even graduates are stacking shelves in the retail industry. I urge urgent action to address the skills shortage. How can IT and technical education be intensified in schools, colleges and universities to meet the imminent demand? What assessment have the Government made of the number of skilled graduates employed in the retail sector and the evident overrepresentation of graduates employed in basic positions on the floor and at checkouts? Do we know what the barriers are that prevent their progress to management? What action is being taken to ensure that employers are keeping their commitment to create local jobs and that pathways are in place for graduates to retrain and transfer their skills to meet employers’ needs in, for instance, data management, automation, digital technology and related sectors?
In my long-standing community experience, 30, 20 and 10 years ago employers used to claim that our kids could not speak good English or were not educated to high standards. This rationale is no longer valid, so why do so many large employers continue not to reflect the borough’s population? In financial, health and education institutions, visible representation remains unequal. School, university, health and local authority leadership does not reflect the local highly educated, trained and fit population. What policy changes are required to address these unequal balances and disparities?
A dizzying array of government and think tank reports highlights the gaps and action required, so we cannot say we lack awareness or evidence. This report is a prime example. Walking in any part of Tower Hamlets, night or day, indicates that countless young people do not have sufficient options for activities outside the home, school or college, after a decade of government and local systemic dismantling of youth provision, career mentoring and leisure facilities. Not enough of our young people are gainfully engaged, employed, training or undertaking apprenticeships, and they lack access to adequate community facilities, sports and other services, resulting in devastating social and mental health consequences.
Incidentally, I welcome the latest Tower Hamlets initiative to reinstate the education maintenance allowance, which was summarily annulled by the previous administration, despite tangible effects on educational attainment in Tower Hamlets in that 10-year period. This is good news for young people who wish to pursue education and not feel the pressure to work. It is worth pointing out that this borough has a proud tradition and history of pioneering activism and visionary entrepreneurship, which is responsible for the curry industry, the gentrification of Canary Wharf, the hipness of Shoreditch and trendy Spitalfields Market, and a growing band of IT technology geeks setting up offices.
The immense physical changes to the area have not necessarily improved the lives of the majority, who live squashed between the many offices and residential blocks of highly prized buildings which look sideways to continuous deprivation, poverty and, crucially, young people’s inevitable cycle of lacking opportunities and, therefore, aspiration. This is the reality of the vast and significant population of families who can only look into the distance of so-called social mobility aspiration.
My proposition is simple: we know the issues for young people up and down our country. Tower Hamlets is no different from Cumbria or Cardiff, where there are unacceptable pockets of disparities regardless of the glaring fact that we are the sixth-largest economy in an ever-shrinking world where young people are aware and connected to others through emerging technologies. The revolution we see elsewhere may come to our shore if we do not create a pathway for their meaningful participation in our economy and empower their fullest potential.
PwC and McKinsey highlight the profound shift towards automation and its disconnect to the job markets. We need to address these gaps early in education and careers advice, as well as creating community services which provide support and mentor young people into the lucrative career opportunities that exist within the emerging technology and digital sectors.
Lately I have had the privilege of working with colleagues from across the House, considering the effect of emerging technology as the chair of the APPG on the Metaverse and Web 3.0. I have met significant numbers of stakeholders and leaders in this space. Again, we need to assert those opportunities and ensure that this space does not continue to be the purview of the elites. We must be prepared to assist the innovators to develop in this space, which includes the creative industries, fashion, AI, robotics, digital currency and so on.
There are new sectors that are also disenfranchising communities and not integrating, although I wish to highlight the Surrey Academy for Blockchain and Metaverse Applications and Durham University Business School, which both reach into the community. Both institutions are looking to work with local communities and schools in order to improve people’s understanding of the potential benefit of explaining a new career choice.
I come to my final point, with noble Lords’ indulgence. I know some fantastic local schools that are working in this field. I commend Miss Nina Morris-Evans, who brought a fantastic group of young people from Haverstock School in Camden to meet us at the APPG on Women and Work. I hope their experience will be a long-standing one and will profoundly impact their choice of careers.
My Lords, we are indebted to the noble Lord, Lord Shipley, and the Youth Unemployment Committee for their endeavours, which have revealed much detail on the subject and resulted in a most comprehensive report. It is unfortunate that we have had to wait a full year for your Lordships to be able to debate its many positive recommendations.
The headline figures for youth unemployment have improved slightly since the report was published, but they still make grim reading. Some 634,000 young people aged 16 to 24 were economically inactive and not in full-time education in July to September this year. Youth unemployment overall may have gone down, but this has not affected the long-standing issue of disabled young people struggling to move successfully from education into work, with little impact on the disability employment gap.
I will dedicate much of my contribution to a major factor hindering a response to the problem of youth unemployment: too many young people are not receiving appropriate guidance at school on what a career can offer and what path needs to be followed to get there. The Careers and Enterprise Company has done much good work in extending the number of secondary schools delivering the Gatsby benchmarks, but I have long believed that careers education and guidance should begin in primary school. I was pleased to note that the committee reached the same conclusion.
Not nearly enough notice is taken by the DfE of the excellent and pioneering work done by a charitable organisation called Primary Futures. Developed with teachers, it connects primary schools with diverse workplace volunteers to take part in aspiration activities and talk with children about their jobs. Even allowing for the disproportionate number of 10 year-olds who want to be footballers, pop stars or YouTubers, many primary school children develop at least an outline of the career they would like to aim for. Why wait until they reach secondary school to begin that journey?
The Gatsby benchmarks were developed by Sir John Holman, whom I think the noble Lord, Lord Baker, referred to. Last year, the Government appointed him as a strategic adviser on careers guidance to Ministers in the DfE; this was necessary because one in five schools in England does not meet any of the eight Gatsby benchmarks. Only 37% of schools meet at least half of them; on average, schools meet just three. There is a serious lack of careers education, advice and guidance in schools, which disproportionately hits disadvantaged young people and those with disabilities.
The Minister will recall that, during the passage of the Skills and Post-16 Education Bill, I and other noble Lords sought to increase the Government’s proposal for the number of times schools should grant access to employers, further education colleges and others under the so-called Baker clause. She resisted that, as she did our proposal for Ofsted to withhold an “outstanding” grade from schools which restricted access to the provision of information on technical education routes. The Act has now given legal clout to provide that access. I very much hope that will see action taken against recalcitrant headteachers and MATs that think the law does not apply to them. This is about young people’s futures; they must be allowed as much diversity as possible in the options open to them.
The Minister and her officials will be aware of the report published last month by Labour’s council of skills advisers, led by my noble friend Lord Blunkett. The report called for a complete shake-up of the careers service, from school through to adult careers guidance, which should ensure that a trained careers leader is embedded in every school with responsibility for the career guidance programme, supported by and accountable to the senior leadership team. I heartily endorse that recommendation.
Apprenticeships are also a key aspect of tackling youth unemployment, because they can change lives. They also offer huge returns on investment for individuals and employers; the Centre for Social Justice showed in a 2020 report that for every £1 invested in level 3 apprenticeships, there is a £28 return to the wider economy. If used properly, they could help to plug the skills gaps our country is facing and support young people into work. The demand for apprenticeships from young people is at an all-time high, but the current apprenticeship levy system favours older learners—those over 25—by a ratio of two to one. Polling by the Centre for Social Justice found that one in six levy-paying employers uses levy funds to rebadge existing training or to accredit skills employees already have. That is not the purpose of the levy.
As recommended by the committee in its report, the Government should require employers to use the apprenticeship system to focus on young people. The incentives for employers to take on apprentices over the pandemic proved effective in boosting opportunities for young people because three-quarters of apprentices who started under this scheme were aged between 16 and 24. This scheme should be reintroduced and financed using some of the levy underspend. Since the levy was introduced in 2017, in excess of £2 billion has been returned to the Treasury. What is the point of that? A Labour Government would also use some of the unspent levy to fund other types of training, which would also benefit young people by offering modular courses and the development of functional skills to tackle key skills gaps.
I agree with the Social Market Foundation’s call for all apprenticeship opportunities to be listed on the UCAS system, perhaps by establishing and integrating local platforms. This would meet the often referenced but rarely implemented parity of esteem between the academic and technical routes open to young people. The lifetime skills guarantee is an important step towards restoring a funded entitlement for level 3 study. However, as many noble Lords emphasised during the debates on the skills Bill, there is no recognition of the value of qualifications below level 3 in creating progression pathways for young people, which is another issue highlighted in the committee report. A DfE report published last year revealed the return on investment of these qualifications and concluded that the net present value of qualifications below level 2 is higher than for level 3. Why have the Government ignored their own evidence?
In his Statement last week, the Chancellor said that
“Being pro-education is being pro-growth.”—[Official Report, Commons, 17/11/22; col. 849.]
Yet despite an extra £2.3 billion annually being announced for schools, there was no extra funding for further education. Colleges are vital providers of skills for young people entering work, yet FE funding compares extremely unfavourably with both university and school funding after a decade of funding cuts. The committee report calls for the Government to devise a new method of funding for FE, determined by student demand. I hope that the Minister will have something to say on that in her response.
My Lords, this is an excellent and comprehensive report, on which I congratulate the noble Lord, Lord Shipley, and his committee. Coming in at the tail end of the innings, I will just comment on some specific issues that resonate with me within the report’s very broad coverage.
Careers education, information, advice and guidance, which are not all the same thing, have made much progress over recent years, not least thanks to the efforts of the Careers and Enterprise Company and the National Careers Service. However, as the report notes, there is still a long way to go to assure truly national coverage, consistency and quality. The report, like much policy discussion, tends to concentrate on the education aspect more than on information, advice and guidance. Yet IAG, delivered by qualified career development professionals, especially through personal guidance interviews, should be at the heart of high-quality careers provision. Such interviews at present are often too few or too short to be fully effective. They fall well short of the recommendation of 45 minutes. One of my consistent concerns relates to the lack of investment in developing the careers development workforce to meet this need.
Another issue is whether schools have the funds to attract and retain qualified careers staff. I hear increasing examples of schools, colleges and National Careers Service providers struggling to recruit and retain qualified careers advisers. What plans do the Government have to address this, perhaps through bursaries or other support to gain the necessary qualifications? Careers leaders in schools are not necessarily qualified to provide IAG, so there needs to be proper funding for professional careers advisers who are. Performance against the Gatsby benchmarks for good career guidance is currently assessed by schools themselves. What plans do the Government have to introduce more rigorous external assessment of outputs—for example, based on the Careers Development Institute’s career development framework or the careers impact review being piloted by the Careers and Enterprise Company, or maybe through a careers guidance guarantee, as suggested in the report?
The report also highlights the crucial importance of work experience. Young people need multiple workplace experiences covering a variety of different business sectors and activities—whether they be talks by employers or employees, workplace visits, job shadowing or actual placements—and these must be of high quality. Meeting the requirements of the Baker clause in its latest incarnation should be an absolute minimum, and needs to be enforced, including through Ofsted inspections. I think it is extraordinary that government programmes such as Kickstart do not include careers support as an integral part. The noble Lord, Lord Watson, mentioned Sir John Holman. His recommendations were promised for summer this year; can the Minister tell us when those will appear?
The report rightly includes a substantial chapter on apprenticeships, making recommendations which I fully support. However, I am a little uncomfortable with the suggestion that any employer receiving levy funding should spend at least two-thirds of it on young people under 25 starting apprenticeships at level 2 or 3. There is certainly a need to increase such apprenticeships for younger people, but upskilling and reskilling existing older workers is also vital, and in some sectors and businesses may be a higher priority and more realistically achievable than taking on new, younger employees. Having said that, I fully support increasing the flexibility of the levy and providing mechanisms to encourage employers, particularly SMEs, to take on more younger apprentices.
The new flexi-job apprenticeships scheme is a welcome idea to make it easier for SMEs to take on and support apprentices, and I was delighted to host the launch of the Evolve flexi-job apprenticeship agency in the Lords in July. However, I worry about whether this will prove attractive enough to overcome the barriers facing small firms considering offering apprenticeships, not just the costs but the management time and effort required to support and oversee young apprentices and the bureaucracy involved. It would be a pity if this scheme followed previous initiatives, such as apprenticeship training agencies and group training associations, in having only limited impact.
One topic not covered in the committee’s report is the role of independent training providers—ITPs—in addressing youth unemployment. They are mentioned only once, and only in a quotation from a government report. Having run an ITP providing employability skills training—including via the Future Jobs Fund, which the noble Lord, Lord Knight, mentioned—for young Londoners, many of them at risk of becoming NEET, I know how important ITPs can be in providing training for people who might otherwise fall through gaps in the system and in meeting specific employer training needs that are not covered by existing FE and other provision. ITPs provide the training for some 70% of all apprenticeships, yet the views and capabilities of ITPs are often underrepresented in policy relating to youth employment and skills. I welcome the fact that AELP—the Association of Employment and Learning Providers—representing ITPs, has recently joined the Association of Colleges and City and Guilds to set up a future skills coalition to promote investment in skills, including a much-needed national strategy to support local, inclusive growth. I hope the Minister will engage with this new body in developing relevant aspects of policy on skills and youth unemployment.
Once again I congratulate the committee on this important report, and the noble Lord, Lord Shipley, on his passionate introduction to today’s debate. I also commend the Government, and in particular the Minister, on their and her commitment to tackling youth unemployment. The report, with its 88 recommendations, presents a substantial challenge requiring a change of mindset, as we have heard. Meeting this challenge is vital not just for young people in or facing unemployment but for our overall national growth and well-being.
My Lords, I declare my interest as a patron of Career Connect and a vice-president of the Local Government Association. It was a privilege to serve on this Select Committee, and I thank my noble friend Lord Shipley for his inclusive chairing and the Members and staff who contributed so much. The report is a must-read document, and anybody involved in education should read it.
If you happened to look at the Evening Standard on Monday, the banner headline on the front page said, “Bosses on Warpath over Foreign Staff”. The piece was about the shortage of skilled staff, particularly in the hospitality and retail sectors, and it was asking the Government to allow more overseas people to come to fill these vacancies. However, it added that the Immigration Minister, Robert Jenrick,
“slapped down those demands … and insisted that employers struggling to find staff should look to the ‘domestic workforce’”.
Really? Where are we going to find these people in the domestic market when we have not been skilling them for the last decade or more? You only have to look at Cumbria, where every restaurant and shop has signs for vacancies, and at the vacancies in the construction industry. We have allowed this to happen. Why has it happened?
Let us take our schools. When I was at school—dare I say it?—there was a grammar school system for those who were academic and technical schools for those wanted to learn skills. Now we have a system where we know that half of our pupils need an academic curriculum and half need a skills-based curriculum, but we forget about those on the skills-based curriculum—they are the failures. When we suddenly wake up and realise that we must have a curriculum for all young people, then Jenrick can make those demands. We are strangling creativity in our schools, while we see the independent school sector sail on in great success.
Unemployment rates and inactivity are higher for young people than the wider population. Generally, that is the case for all countries with limited work experience, barriers to some roles by age and qualifications, and limited work readiness. At the moment, youth unemployment is historically low, but not overall: 12 OECD countries have better rates than us. For example, in the latest statistics, the UK rate is 13.4% compared with, for example, the Netherlands at only 4.6%. Of course, we must ask what the impact of Covid has been. We did not see a large growth in youth unemployment, and we must credit the furlough scheme and Kickstart which helped reduce what would have been a large growth in the figures. Young people, though, were still more impacted as they predominate in the sectors worst hit—the retail and hospitality sectors—where they were not able to work from home. There was disruption to their exams and education, a lack of work experience and an impact on confidence and teamwork skills—and let us not forget that there are significantly higher rates of unemployment for young people from ethnic backgrounds, care leavers and those with special educational needs.
Job vacancies in the past 12 to 18 months have increased significantly, so why are there so many young people out of work? Over the last decade, the number of young people not in employment, education, and training and with mental health issues has tripled. There are a third fewer apprenticeship starts for under-19 year-olds than a decade ago, and still a third of young people leave school without five good GCSE passes. Work readiness is a major challenge because education, with its significant focus on academic attainment, is not preparing young people for work; as I said earlier, we need to have a curriculum which is broad-based and which recognises the importance of skills and learning.
Areas with the highest vacancy rates are in sectors that struggle to attract staff, which is due to low pay and challenging working conditions—the care sector is the prime example. The DWP has run a number of major programmes during the last two to three years, including Kickstart and the youth offer. How effective are those schemes and how can we make them better? Kickstart has been very positive in lowering youth unemployment during the pandemic, alongside the furlough scheme, with 162,000 young people starting Kickstart. There is strong evidence of intermediate labour market schemes working where they were implemented quickly and when they worked closely with the sector, but there were more challenges, not least bureaucracy—it took longer to approve vacancies and advertise them. This is no way for young people to search for suitable roles.
The need for technology is vital. The charity of which I am a patron took three months to have vacancies approved. In Written Questions I have constantly raised issues about 16 and 17 year-olds being eligible for Kickstart. Now the figures are available: 80% of this age group were excluded as they were not receiving universal credit, yet they were not in employment, education or training.
There were major regional disparities. There were one-third fewer placements in the north-east compared with London. This is not levelling up. The north-east should have double the number of placements of the south-east. The £1.6 billion that was spent on the scheme and the subsequent underspend on Kickstart should have been avoided.
Let me turn to the so-called work coaches. How effective are DWP work coaches at supporting young people? They are clearly committed, and work coaches provide an important service. The key challenge is their capacity to support young people. Building trust and rapport are key, along with soft skills, CVs and confidence building. Unfortunately, this is not something the majority of work coaches can provide in the time available. The majority have only five to 10 minutes per young person, which is filled largely with administration and conditionality, and they have a case load of 100 to 150 young people. Training tends to focus on administration and bureaucracy, not coaching.
It would be better to have charities and other organisations supporting young people. These organisations have the time, the expertise and the confidence to support young people. Experience in youth work and careers advice is vital. It takes, for example, two years to train a careers adviser. Can the Minister tell me, when it comes to the career coaches who work for the DWP, what is their qualification for the role? What are they required to have?
The noble Lord, Lord Shipley, mentioned apprenticeships and the research that showed the huge number of drop-outs. In a study of 2,500 apprentices, there was a 47% drop-out rate. That is quite concerning and worrying. I am also concerned, as I have already mentioned, by the fact that so many young people under the age of 20 are not taking up apprenticeships.
To end, we are told by the Office for Budget Responsibility that there will be a rise in unemployment in the coming year. Of course, that will disproportionately affect young people. It will have an effect on the industry and businesses that will not be able to fill the skills gap they desperately need to, and it will therefore have an effect on the growth of our economy.
I noted that the Minister for Work and Pensions—it seems that I am having a go at the DWP—sent out a letter in which she referred to “supporting the most vulnerable” through economic challenges. There is no mention in that letter of young people and how they will be supported, particularly if they are unemployed. I also noted that in the Chancellor’s so-called Statement there were extra resources for education. Sadly, there were no extra resources for further education or the skills sector.
I want to see a thriving economy, but you have a thriving economy only if you have the skill set and the people who are trained to fill those roles. We are letting our economy, our country and those young people down. I do have a hope for the future—that we have, as we have heard twice now, a Secretary of State who was an apprentice herself. More importantly, she comes from Liverpool.
My Lords, I declare that I too am a vice-president of the Local Government Association. I thank the noble Lord, Lord Shipley, for leading the production of this report over a year ago and for his introduction, which provided a detailed summary of the report’s findings, together with positive suggestions for improvement. I restate my thanks to the noble Lord, Lord Baker, for the introduction in 1988 of those five Baker days, which helped to put professional development for teachers on a positive footing. I will try to give him some optimism tonight as I detail throughout my speech what a Labour Government intend to do about righting the wrongs so exposed by this excellent report.
This report makes for stark reading. At the time of publication last November, 12.6% of 16 to 24 year-olds were neither working nor in full-time study, and youth unemployment was at 11.7%. It is not much better today; now that the pandemic is abating, it is just under 10%. The committee’s report notes
“Unequal access to high quality careers guidance and a decline in work experience opportunities”,
and that careers guidance often starts too late to be useful. Noble Lords may remember my Front-Bench colleagues and I attempting to amend the skills Bill to ensure careers education from year 7, but we were unfortunately unable to persuade the Government of the merits of this, as so well detailed again this evening by my noble friend Lord Watson. Perhaps now they will think again.
Under the current system, employers can use the apprenticeship levy money only on apprenticeships. Some businesses have decided not to touch their levy money, while among those who spend it, employers report spending on average 50% to 60%, meaning that around £1 billion a year is going unspent in England. As a result, the CBI, Make UK, the British Retail Consortium and other business groups have highlighted a number of problems with the system and called for additional flexibility for business. The report that we are discussing today deals with this need for additional flexibility and calls for reform of the apprenticeship levy, such that any employer receiving funding from it is required to spend at least two-thirds of it on young people starting apprenticeships at levels 2 and 3 before the age of 25.
To begin to address these reforms that are so badly needed, my party has committed to a new growth and skills levy, which will give businesses the freedom to use currently unspent money, up to 50% of their total levy contributions, on non-apprenticeship training, with at least 50% reserved for apprenticeships. Clearly, stakeholders of all stripes are united: the levy is not working as it should for our young people.
Last month, my noble friend Lord Blunkett launched his report Learning and Skills for Economic Recovery, Social Cohesion and a More Equal Britain, which set out the scale of the transformation that we must deliver to equip Britain to succeed in the 21st century. Skills England, a new national skills taskforce, should be implemented to drive a national mission to ensure that young people and adults can access the training, reskilling and upskilling needed to thrive. We need to see similar focus and ambition from the Government on tackling youth unemployment, which is still above the G7 average.
My noble friend Lord Knight of Weymouth posed some far-reaching questions on the future needs of young people in education today, and how those needs have to be future-proofed. We must make much more use of developing the green economy and technology in developing young people’s skills. My noble friend Lord Watson referred to the careers aspects of this transformational report.
In taking this forward, Labour will be focused on how we deliver growth and enable people to take up good jobs in towns and cities across the UK. That is why Keir Starmer has already said that we will adopt my noble friend Lord Blunkett’s recommendation to introduce flexibility into the apprenticeship levy, flexibility that businesses are telling us they need to access the range of skills relevant to their workplaces. They will be able to spend money on short, modular courses, or pre-apprenticeship training, helping people to get new opportunities.
After more than a decade of failed Conservative policies, it could not be clearer that it is working people who will drive economic growth in this country, and we will focus on enabling people to succeed. As it stands, skills budgets are disparate, incredibly centralised and, more importantly, clearly not working. If we want young people to get on, we must devolve and combine these budgets, so decisions about training and upskilling are made closer to the people, businesses and communities who need them—those with real skin in the game. There is a tangible need for skills policies to be better aligned with regional economic policy and local labour markets, to deliver a more local, tailored approach to skills provision.
Analysis for the LGA by the Learning and Work Institute shows that the number of people improving their skills or finding work could increase by 15% if councils and combined authorities were better able to co-ordinate and bring together employment and skills provision across a place. Labour will merge the various education skills funding for adult streams, such as the shared prosperity fund and Multiply, with the existing adult education budget. This will then be devolved to combined authorities which, in collaboration with central government, will direct skills spending in their region and use their convening power to ensure that skills provision in their area is aligned with the local labour market, bringing together representatives from new local skills improvement partnerships, FE colleges, universities and local businesses. Skills England will co-ordinate the framework within which combined authorities deliver skills funding to make sure that local outcomes and local priorities are aligned with our industrial strategy and help us meet the challenges the country will face over the coming decades.
We will introduce a list of approved qualifications that businesses could spend their flexible levy money on, which will be developed by a new body in collaboration with businesses, unions and wider experts. We will include modular courses in priority areas which lie at the core of our industrial strategy, including digital and green skills, social care and childcare, which will boost training opportunities with a view to supporting national ambitions such as the transition to net zero. Functional skills and pre-apprenticeships training will help to tackle key skills, especially around basic digital skills. SMEs, which do not pay the levy, will be able to reclaim 95% of co-payments on approved courses in the same way.
Furthermore, Labour is committed to a complete review of the school curriculum, which was mentioned by noble Lords in the debate this evening. We would ensure that young people are equipped for the world and workplace of the future, not of the past. Among other things, we will look to reform the citizenship curriculum so it embeds practical life skills—looking at budgeting or understanding employment contracts—and digital competency, so that all young people gain the digital skills that they will need to thrive. We will ensure that this review is carried out by expert opinion because we want to give young people the best start in life and ensure that they leave our schools ready for the future.
I can go through the Government’s record on this issue to date—I am not normally a negative person, but apprenticeships have declined by almost 200,000, 11 million adults lack basic digital skills, and 9 million lack essential literacy or numeracy skills. There were 4 million fewer adults taking part in learning in 2020 compared with 2010.
What are we to do? A headmaster told me once, “Debbie, the biggest room in the world is the room for improvement.” He was right. He had it on a T-shirt which he liked to wear.
I end by quoting from the conclusion of my noble friend Lord Blunkett’s report:
“If there is not a step change which re-balances the economy, lifts the productivity and growth in regions across the nation to the levels seen in London and the South East, then the danger of stagflation will continue, the country will stagger on accepting mediocrity, gradually sliding further behind those countries who are determined to equip their nation for tomorrow’s world.”
My Lords, the Government welcome the report Skills for Every Young Person and I thank the noble Lord, Lord Shipley, for securing this debate and for his skilful and inclusive chairing, as has been referred to several times. I thank all members of the committee who contributed to the report and all noble Lords who have spoken today with such clarity. I was also pleased to see that the Government’s successes were recognised in the report, such as the establishment of careers hubs and the decreased rate of those not in education, employment or training for 16 to 18 year-olds in particular, which is currently one of the lowest on record at 6.4%.
As the report acknowledges, young people were some of the hardest hit by the pandemic, but I am pleased to say that through the historic levels of support, which your Lordships have acknowledged tonight, provided through the Government’s plan for jobs package, including programmes focusing on young people, we have seen a strong recovery.
A number of the report’s recommendations and of the comments from your Lordships tonight relate to school curriculums, so I will begin there. Every state-funded school must offer an ambitious curriculum that must be balanced and broadly based, promote the spiritual, moral, cultural, mental and physical development of pupils and prepare them for wide-ranging experiences of life. I did not recognise some of the descriptions of the curriculum that your Lordships shared tonight. The curriculum currently encompasses both knowledge and skills, and the published programmes of study for national curriculum subjects demonstrate how knowledge and skills are intertwined. A very large body of evidence shows that fluency of knowledge acts as the building block for the development of skills.
Yours Lordships’ report recommends embedding digital skills within the national curriculum, so it might be worth mentioning here that that computing is a statutory subject within the national curriculum across key stages 1 to 4. There was a 16% increase in the number of students taking computer science in 2022. It was the second-fastest growth rate in STEM subjects after design and technology so, with respect, I do not recognise the description by my noble friend that there has been no innovation since the Edwardian curriculum. I am not aware of Edwardians studying computer science or design and technology.
The noble Lord, Lord Shipley, questioned whether design and technology is seen as important as other subjects on the curriculum. As the noble Lord knows, all state-maintained schools must teach DT to pupils between the ages of five and 14, that is in key stages 1 to 3. There is also a statutory entitlement for every pupil in key stage 4 to take DT if they want to, and the new Ofsted inspection arrangements place renewed focus on that broad, balanced and ambitious curriculum. We are also working very closely with a number of organisations, including the James Dyson Foundation, the Design and Technology Association and the Royal Academy of Engineering, to make sure that the curriculum is up to date and gives the knowledge and skills that employers want.
I turn to careers guidance, which was highlighted by the noble Lords, Lord Watson of Invergowrie, Lord Aberdare and Lord Shipley, as well as other noble Lords. We know that there is huge value in good careers guidance in terms of nurturing aspiration and ambition, and your Lordships rightly focused on the Gatsby benchmarks in your report. To give one example of their impact, evidence suggests that the proportion of post-16 students who are not in employment, education or training fell by 20.1% in the most disadvantaged quarter of schools since they adopted the benchmarks, and 90% of schools and colleges are currently part of a careers hub, which is accelerating the quality of careers provision. We are seeing rapid improvements in hubs and disadvantaged areas are among the best performers.
The noble Baroness, Lady Wilcox, and the noble Lords, Lord Watson and Lord Storey, raised the important subject of careers education in primary school. We recognise the value of supporting primary schools to help children explore the world of work, and careers provision is embedded in the key stage 2 citizenship curriculum. Thanks to the Careers and Enterprise Company, we have also provided all primary schools with resources to help pupils explore the world of work and, as the noble Lords who joined me in debating the skills Bill will remember, we have allocated £2.6 million over the current spending review period to bring new programmes to support careers education in primary schools in the 55 education investment areas.
The noble Lords, Lord Shipley and Lord Aberdare, talked about a duty for young people to receive work experience. We absolutely agree about the importance of work experience, as is very visible in the whole approach we have taken to T-levels. A lot of work is going on in this area. There are now 400 cornerstone employers bringing together business effort and engagement with local schools and colleges and increasing the number of employer encounters for young people. We have more than 3,500 business professionals working as enterprise advisers with schools and colleges to develop their career strategies and plans for engaging with employers. If I may, I will write to the noble Lord, Lord Watson, on the Gatsby benchmarks and go through the numbers. I fear I may be writing a long letter at the end of this debate, as I fear I will not have a chance to do justice to all the points raised.
The noble Lords, Lord Knight and Lord Addington, made a really important point about the need for a culture change. The Government can do their bit but, as the noble Lord, Lord Addington, said, parents and employers also need to play a part. We continue with our ambition to achieve equality of esteem between academic and technical routes. That will depend on the quality of the offer and on breaking down barriers between further and higher education.
The report made a number of references to bringing funding for further education more in line with that for higher education, so I hope noble Lords will be encouraged that from 2023-24 higher technical qualification student finance will be brought on a par with degrees. This is just one step, along with the lifelong loan entitlement and other reforms this Government are bringing in.
The noble Baroness, Lady Wilcox, described a top-down, soviet model of policy in this area. I think she referred to local skills improvement partnerships. I hope she will acknowledge that they are an important positive devolution of responsibility in making sure that we get the best possible interface with local areas.
As a Government, we are delighted that T-levels got off to a great start with the first cohort of students completing their courses this year with an impressive 92% pass rate. Your Lordships will be aware that every T-level includes important modules on digital skills. On the T-level transition programme, we are very clear that we need to support young people who might need a bit more help to access the programme and to ensure that that ladder of opportunity leads to higher technical qualifications.
The noble Baroness, Lady Wilcox, talked about what Labour would do in terms of a range of short courses and flexible options. I thought it sounded remarkably similar to the short courses and flexible options that we have been providing. The noble Viscount, Lord Waverley, and the noble Lord, Lord Knight, touched on this. We have skills boot camps delivering flexible training for new skills in green construction, renewable energy, protection of natural resources and the transport sector, including, I hope the noble Viscount will be pleased to hear, £34 million so that 11,000 adults have been able to train as HGV drivers to meet some of the gaps there. In terms of green transport skills, I was sorry to hear about the noble Lord’s visit; I went to see a college recently which was very much focused on electric vehicles, so maybe this is just in transition.
Obviously, apprenticeships need no introduction to the House. The report made several recommendations for widening the support for apprentices under the age of 25. Currently, 53% of apprenticeship starts are by young people under this age—I was not sure that I recognised the figures that the noble Lord, Lord Watson, cited. But we want to support even more young people to realise the benefits of apprenticeships; several references were made in the debate to my right honourable friend the Secretary of State and her remarkable career starting as an apprentice. Noble Lords will also recognise the voice of my honourable friend the Minister for Skills, who formerly was chair of the Education Select Committee and has been a passionate advocate in this area. So there is no lack of enthusiasm in the department.
One of our measures is a new career starter apprenticeship campaign. We are trying to showcase apprenticeships suitable for those leaving full-time education. We know, too, that there is huge demand for degree-level apprenticeships; we are seeing year-on-year growth of apprenticeships at levels 6 and 7, and we are enabling higher education institutions to grow their delivery through the strategic priorities grant.
The noble Lords, Lord Shipley and Lord Storey, made the valid point about the apprenticeship completion rate, which we are very focused on. We are aiming to reach a 67% achievement rate on apprenticeship standards by the end of the 2024-25 academic year, and we have a programme of actions to make that a reality in terms of investing in a new development programme for the provider workforce, offering targeted support for employees and ensuring that apprentices get the best information, support and advice before and during the programme. I think that the noble Lord, Lord Shipley, cited the main reason. How many times can I hit this microphone? It is every time I turn the page. I apologise to your Lordships.
The noble Lord, Lord Watson, suggested that levy funds should be ring-fenced for young people and the noble Lord, Lord Aberdare, made the case for the need to keep upskilling and reskilling our existing workforce. Clearly, our ambition is to offer opportunities in both areas.
I thank the noble Lord, Lord Shipley, for recognising the work that we have done on the Unit for Future Skills. I remember arriving in the department on almost my first day, sitting down with the Skills Minister and asking for the data on how we join this up—so I am personally delighted to see that we have taken this area forward. The unit is very ambitious about improving the quality and availability of data on skills and jobs, and we are making fantastic progress on that already.
I turn to green skills and I hope that the daughter of the noble Lord, Lord Knight, will have an amazing career ahead of her—I am sure she will. I was very lucky to attend the COP 27 summit, really making the case for the importance of education in our sustainability agenda. We are working domestically but also, importantly, internationally, on the whole green skills agenda. Clearly, there will be global competition for green skills. We will deliver the first ever international green skills conference next year, and we are working with the further and higher education sectors, and with young people. We have been fantastically supported by the young people’s panel, industry and policymakers to deliver a conference that will really showcase the best of green skills learning and training opportunities and highlight green career paths and enhanced international partnerships. We have a very ambitious strategy on this in the department and, of course, many of our T-levels and other qualifications will underpin skills in this sector. I genuinely believe—not just for the daughter of the noble Lord, Lord Knight, but for all young people—that the scale of opportunity in an area that young people care so passionately about is really fantastic, so I hope that young people will leave equipped with the skills that they need and also with the hope that they can use them.
The noble Lord, Lord Storey, questioned the impact of the Kickstart scheme. Since the launch in September 2020, over 160,000 Kickstart jobs were started by young people. Now that the scheme has closed, we are evaluating and learning from it. We built on Kickstart’s success to influence the Way to Work campaign, where we helped over 500,000 job-ready claimants, including young people, into work between January and June this year. The campaign provides claimants with more time with their work coaches and more nurtured connections with local employers to improve their employability. Through the Youth Offer, we are helping thousands of eligible 16 to 24 year-olds from all backgrounds to overcome the barriers and find work. It offers individually tailored work coach support.
The noble Lord asked about the qualifications of work coaches, who are part of the workforce. They are offered a tailored learning and development programme, so they have skills and knowledge, but also technical knowledge of the benefits to coaching, and they are encouraged to signpost customers who would benefit from expert careers advice to the National Careers Service.
That is correct. That is not to say that some of them do not have formal qualifications, but they receive additional support.
The noble Baroness, Lady Uddin, highlighted some powerful examples of children from minority communities, particularly in Tower Hamlets, and the barriers they face. I do not have the detailed data on the boroughs that she referred to, but 24% of those currently engaged in further education and skills education come from diverse backgrounds. We have an apprenticeship diversity champions network, which promotes diversity to employers and encourages people from BAME communities to consider apprenticeships. We have seen a significant rise in apprenticeship starts from those communities, and of course the noble Baroness will be aware that there has been a significant rise since 2010 in the number of 18 year-olds from ethnic minority backgrounds going to university, from 32% to 50%.
A number of noble Lords asked about funding for further education and skills in the recent Autumn Statement. I remind your Lordships that the Government have introduced major structural reforms, investing £3.8 billion in skills over the life of this Parliament.
In closing, we are rightly proud of our successes, and we absolutely recognise that some young people continue to face additional barriers to employment, including those from ethnic minority communities and those with special educational needs and disabilities. The reforms and measures I have outlined are about every young person fulfilling their potential, as well as equipping young people for the future workforce. They aim to give young people the opportunity to progress, whatever their choices and wherever they live. They are about better prospects for disadvantaged young people, because we share the commitment in your Lordships’ report that no young person should be left behind.
My Lords, I thank the Minister very much for what she has said, and I should say that the government response to our report was extremely helpful. It defined what the issues were, which enables us to have a continuing debate on the conclusions and recommendations that the committee reached and on the Government’s actual actions to reflect what is happening outside Whitehall and Westminster.
As I have indicated, this has been a very helpful discussion and it has shown a broad unanimity of view on the issues. We will continue having this debate, because the country needs this debate. Let us look at the broad facts that we have debated tonight: 9% of young people are unemployed and there are 630,000 young people not in employment, education or training, yet there are 500,000 job vacancies in our country. As employers kept telling us, there is a huge skills mismatch, and they have great difficulty in recruiting the people they need at the levels at which they need them. So I conclude by saying that something has to change, and I hope it may be that this debate, our report and the government response will assist us in achieving the change that the country is actually asking for.
Committee adjourned at 8.01 pm.