House of Commons Hansard Debates for 8 Nov 1989

Mr. Thornton : Is my hon. Friend aware that section 1 of the Race Relations Act 1976 states that, if a "requirement or condition" can be shown to be

"justifiable irrespective of the colour, race nationality or ethnic or national origins of the person to whom it is applied", indirect racial discrimination will not have occurred? That is the legislation to which I referred earlier. If the amendment is agreed to, it will deem that the enforcement of the safety helmet policy on a Sikh who is not prepared to wear a helmet would not in any circumstances be justifiable. The point that I am making--with respect to my hon. Friend, I feel that he has not answered it--is that existing legislation is sufficient to guarantee what the Government are saying should happen, which is that the general exemption should apply. The burden of proof would be on an employer to show before a court or other tribunal that what he was suggesting was justifiable. It cannot be right that there should be no element of justifiability.

Mr. Eggar : There may be a minority of employers who, irrespective of the exemptions that I hope the House will grant this evening, would claim that the normal wearing of a safety helmet justifies their refusing to employ Sikhs, or moving their existing Sikhs to other work. That is the point that is made by the Building Employers

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Confederation. This requirement would amount to indirect racial discrimination under the 1976 Act, but under that Act the employer could argue as a defence that his action was justifiable as he was applying the condition of wearing a safety helmet purely on health and safety grounds. In other words, if we did not agree to amendment No. 5, an employer could override the exemption which the House is being asked to grant.

I return to my original answer to my hon. Friend the Member for Crosby. If we accepted his argument, we would bring uncertainty where, above all, we want certainty and clarity. The argument of my hon. Friend on the burden of proof is not one which we would necessarily accept. There is a conflict between the legal advice that has been given to him and that which is available to me. It is a difficult area, because no clear decision has been made by an industrial tribunal. The law is not as straightforward as my hon. Friend has suggested.

We have had a useful and constructive debate on a difficult issue. I am grateful to my hon. Friends and to the hon. Member for Derbyshire, North- East for contributing to it. I ask the House to agree to the amendments.

Ms. Richardson : I apologise to the Minister for not rising to my feet as swiftly as I should have done before he replied to the debate.

We think that the Government have it about right. We accept that there are groups in our society who have certain deeply held beliefs that should be recognised and respected. If that means that such people--in this instance, the Sikhs--are prepared to endanger themselves by wearing a turban and not a hard hat, that is for them to decide. Their views should be respected.

I was very shocked by the speech of the hon. Member for Bridlington (Mr. Townend). Indeed, I felt extremely uncomfortable about it. I am sure that I echo the feelings of my hon. Friends in saying that we want a multi- cultural society--not an integration of those who have come to live among us or, in many cases, were born here. We do not want them so assimilated that they disappear. We want to benefit from their cultures.

Mr. John Townend : Does the hon. Lady think that she is expressing the views of the vast majority of the British people? In my part of the country people think that there should be integration and assimilation and that we should become one people, the British people, regardless of colour.

Ms. Richardson : Those whom I meet in my constituency and elsewhere are much more tolerant than the hon. Gentleman gives them credit for. I do not know about the people of Bridlington. I do not know whether Sikhs live in Bridlington. I do not know whether those whose views the hon. Gentleman has apparently expressed have ever met Sikhs or discussed this matter with them. Perhaps they do not understand their deeply held beliefs.

I remind those hon. Members who can recall the event that some years ago the same arguments were rehearsed, from both sides of the House, about the wearing of crash helmets. I am proud and pleased that I voted for a measure that allowed people to wear turbans instead of crash helmets. There have not been any bad effects, although I do not pretend to know whether anyone has been killed. Nevertheless, it is proof of the pudding. We were tolerant then, for goodness sake let us be tolerant now.

Question put and agreed to.

Lords amendment No. 5 agreed to.

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Clause 20

Dissolution of Training Commission

Lords amendment : No. 6, in page 15, line 1, leave out subsection (2) and insert--

"(2) Subject to subsection (2A), all the property, rights and liabilities to which the Training Commission was entitled or subject immediately before that date shall on that date become property, rights and liabilities of the Secretary of State.

(2A) Any liability in respect of pensions, superannuation allowances or gratuities which, but for the passing of this Act, would have arisen or existed on or after that date as a liability of the Training Commission to or in respect of the chairman or any former chairman of the Commission shall instead be a liability of the Paymaster General."

Mr. Nicholls : I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker : With this we may discuss Lords amendments Nos. 7, 16, 19 to 26 and 29.

Mr. Nicholls : These amendments all follow from the provisions of the Bill that dissolve the Training Commission. Between them, the amendments have the single main purpose of transferring land currently held by the commission to my right hon. Friend the Secretary of State for Employment.

The Training Commission has always been able to hold title to both freehold and leasehold land and buildings. Its property is not part of the civil estate, which is mostly held by my right hon. Friend the Secretary of State for the Environment through the Property Services Agency. The Training Commission mainly exercised its land-holding power in relation to much of its jobcentre network and skills training agency sites. The arrangement has been particularly appropriate because the buildings held in that way by the Training Commission are mainly specialist in nature. Upon dissolution, it will be necessary for that property to be transferred to a new owner. When the Bill was being drafted a final decision on who that new owner should be had still to be taken. The Bill was therefore published with the provision that the Secretary of State should designate a Minister to hold the land title.

We have since concluded that the title should be held by my right hon. Friend the Secretary of State for Employment. Having direct land-holding powers within the Department will give my right hon. Friend more direct accountability and responsibility, as well as improving administrative and operational efficiency. Before he can hold title to the land, my right hon. Friend must be constituted a corporation sole, which is what the main amendment in the group, No. 21, provides. The other amendments in the group simplify the drafting as there is no longer any need to differentiate between land going to the designated Minister and other property going to the Secretary of State. Now, with one exception, everything will transfer to my right hon. Friend the Secretary of State, with all the associated rights and liabilities. The only exception is that the Paymaster General will exercise his usual responsibility for the pensions and similar payments due to the chairman and former chairmen of the commission. I hope that, with that brief explanation, the House will be content to agree with the Lords in the said amendment.

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Mrs. Maria Fyfe (Glasgow, Maryhill) : I must confess to some puzzlement. The Minister has spoken only about the transfer of assets and the staff concerned, yet I understood that this group of amendments was to do with the dissolution of the Training Commission. If that is the case, I want to speak about that as well as about assets, property and staff.

It is not clear whether future employers will stand by any employment agreements on wages, job conditions or pensions of staff. The Minister should say something about that. It would be interesting also to know the value of the property that is to be transferred and how the Minister predicts it will be farmed out to the successor bodies.

The main issue here, however, is the abolition of the Training Commission. It is incredible that we are having such a brief debate on this subject, which is vital to the nation's future industrial prosperity and our work force's training opportunities. It is not clear why these proposals were not brought before the Standing Committee. Perhaps the Minister will be good enough to tell us why the Government waited until debates in the other place to raise the issue.

There have been numerous and confusing changes in training schemes recently. We used to have the Manpower Services Commission, which was a tripartite body comprising three employer, three trade union and three education authority representatives who ran the youth training scheme and the technical and vocational education initiative in schools and colleges. It included local councillors and local bodies that represented all three interest groups. They approved, or did not approve, schemes, but in some cases did their job too well for the Government. They found fault with the quality of schemes, whether because of the content, the training or unsatisfactory or unsafe conditions, and some of them said so. The Government curtailed their role and then disbanded the MSC. The Government then created the Training Commission, which is now to be disbanded. The new idea is to have training and enterprise councils. How many bids have there been in each area to run TECs?

Will the Minister confirm our information, which is that in many cases there is only one bid? Would he care to comment on the likely outcome in terms of the breadth and quality of the training? Are all the leading figures in industry and commerce and top management in the private sector, who will run TECs, to be white and male--with one exception, I gather, in Newcastle somewhere? If so, is that not possibly in breach of the sex discrimination and racial discrimination legislation, perhaps not technically, but in spirit? I am puzzled how employer-led schemes are expected to succeed in some areas. The Governmnt are fond of telling us how successful their efforts to do away with unemployment have been, but there are numerous constituencies where unemployment is very high. In Liverpool, Riverside, for example, 25.3 per cent. of the available work force is unemployed. In Glasgow, my home town, no fewer than eight constituencies are in the top 20 of high unemployment. The official figure in Maryhill, my constituency, is 18.5 per cent., but the real figure, after allowing for the Government's fiddling of the figures, is considerably higher. There are many other constituencies with high unemployment--in Manchester, Birmingham,

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Tyne Bridge and Sheffield, for instance. If there are not too many employers about, how are they supposed to organise training schemes for the available work force?

This policy might seem very reasonable in Horsham--where unemployment is running at 1 per cent.--and in Mid-Sussex, Wokingham, Chesham, Amersham and Mole Valley, where the rate is similarly low. It is simply not relevant, however, in areas of high unemployment. I wonder whether the Minister has thought his way through the problem, or whether areas such as Glasgow have, as usual, been written off as being of no importance because the Government do not care what happens to those who will not, in any event, vote Conservative. How can such schemes possibly work, in the light of the attitude of management to training? As we travel along this road, we can predict exactly where we will arrive. An MSC/NEDO report concluded some time ago that British companies rarely considered training one of the main components of corporate strategy, and did not treat it as a boardroom issue. In another place, the Government even rejected a modest proposal that training organisations should be consulted before appointments were made.

Thus we shall have a work force trained in a narrow range of skills to suit individual employers. In a world of rapidly changing technology, their skills will be bound by whatever the local management sees fit to provide. They will be trained, but not educated. Can we believe that all employer- led agencies will be keen to foster a critical intelligence and the asking of awkward questions? Some will train ; many will poach. Would it not, after all, be better if we retained the present arrangements and tried to improve them? Would it not be better if management got on with running their businesses, while those who know something about education and training got on with their business?

Mr. Wallace : I cannot accuse the Government of curtailing debate on the winding-up of the Training Commission : that provision was in the Bill originally, and was also debated in Committee. A more substantive criticism concerns the way in which the Manpower Services Commission was suddenly wound up to make way for the Training Commission, which is now being wound up in its turn. There has been little consistency or stability in the provision of training. I shall ask only one or two questions ; the next debate may allow broader discussion of some of the issues. First, can the Minister give us some idea of the value and extent of the property and the assets with which we are dealing? Having become "incorporated"--I hope that that will not be too painful--what does the Secretary of State intend to do with the assets to which he will have sole title? We know that, for better or worse, TECs are taking over from the Training Commission. What statutory provisions underpin them, though? How will those involved in them be accountable to the House for the money that they spend--in many instances, vast amounts?

Mrs. Mahon : I am very concerned about the way in which the amendments have been brought to the House, and about how responsibility for training is being given to people who have clearly failed in the past. The private sector has a very poor record. My constituency contains a TEC, and we know the names of the good and worthy whom the Minister has seen fit to appoint.

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Mr. Martin Redmond (Don Valley) : Business men one and all.

Mrs. Mahon : They are indeed--and they are exactly the same people who were appointed to the business in the community scheme, which also operates in my area, and to the Eureka project for an educational museum, funded mainly by private means. In the past, such people have largely relied on the public sector.

I am also concerned about the fact that there is no employee representation on the TECs. The proposal will not provide a coherent national training programme. I am bitterly disappointed that it has been brought before the House in this way.

Questions were asked in the other place about the European social fund. The figure of £60 million was mentioned as having come from the European social fund during the last 10 years. Most of that money was targeted on special projects. I hope that the Minister will say something about the future of that funding. Who will be accountable for the huge sums of money that will be provided by the public sector?

Mr. Nicholls : With the leave of the House, I shall reply briefly to the debate. In doing so I hope to clear up a misunderstanding. The amendments are specific. They do not relate to the dissolution of the Training Commission per se. They relate to the narrower and doubtless fascinating, although somewhat arcane, debate about who should own the land after the Training Commission is dissolved.

When these matters were first considered, a final policy decision had not been reached on precisely which Minister should be responsible for taking over the land holding. The traditional view was that all this should be done through the Property Services Agency via my right hon. Friend the Secretary of State for the Environment. However, it was thought to be more sensible in the case of what might be described as a specialised property to place it in the hands of the sponsoring Minister. That is why it was proposed that my right hon. Friend the Secretary of State for Employment should take over the land holdings--not because of any particular desire on his part to indulge in empire building but because it seemed to be logical that he should take them over.

The amendments, I repeat, do not refer to the debate about why the Training Commission should be abolished. However, the hon. Member for Orkney and Shetland (Mr. Wallace) put his finger on it when he said that we had that debate in Committee. Having already this evening been accused of being surprisingly nice, I hesitate to confound that new assessment of me by significantly lowering the tone of the debate. However, perhaps I could delicately remind the hon. Member for Glasgow, Maryhill (Mrs. Fyfe) that the reason for the abolition of the Training Commission was because one of the main limbs of that tripartite structure--the TUC--came out against employment training. Bearing in mind that that was the Training Commission's biggest programme at the time-- [Interruption.] The hon. Member for Maryhill lines herself up behind the wreckers of employment training. The fact is that the Manpower Services Commission, the predecessor of the Training Commission, was responsible for designing the programme, together with trades union commissioners. However, they then decided, for what one can only conclude were party political

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reasons, to oppose it. It would have been a complete nonsense for the commission to continue to function when one of its main limbs was campaigning against what it was designed to do. The decision was taken, therefore, to abolish the Training Commission.

I am going over somewhat old ground that has been debated before, but it is right to make that point in order to clear up any apparent confusion among Opposition Members.

Mrs. Fyfe : I thank the Minister for clearing up some of the confusion, but he is labouring under the delusion that we are simply talking about trade union involvement in what was formerly a tripartite body. I have read thoroughly the debate in the other place on the issue. There were many references to the fact that education and training bodies were not represented on the commission. The Minister has chosen to deal only with uncontroversial property matters. He is dodging the issue of the role of the trainers and educators.

Mr. Nicholls : If I am to be accused, even pilloried, for keeping myself within order, I shall have to suffer those slings and outrages with as much fortitude as I can command. The amendments are specific ; if Opposition Members wanted to broaden the debate on the commission, they should have worked out how to do so.

I do not think that I shall be giving too much away to some hon. Members if I say that TECs and general Government training policy will be considered in the next debate on industrial training boards. This narrow debate is on the land-holding capabilities of my right hon. Friend the Secretary of State. I hope that the House will agree that I have addressed those concerns quite directly.

Mr. Wallace : I asked two relevant questions within the narrow confines of the debate on the extent of the land holdings and what the Secretary of State proposes to do with them.

Mr. Nicholls : The land holdings will be those formerly held by the Training Commission. Jobcentres will be among the properties affected, and, within the meaning of the statute, my right hon. Friend intends to own them.

Question put and agreed to.

Lords amendment No. 7 agreed to.

Lords amendment No. 8, before clause 21, insert the following new clause-- Consultation in connection with industrial training orders ". In section 1 of the Industrial Training Act 1982 (establishment of industrial training boards), the following subsection shall be substituted for subsections (4) and (5)--

"(4) Before making an industrial training order the Secretary of State shall consult--

(a) such organisations or associations of organisations appearing to him to be representative of substantial numbers of employers, and such bodies established for the purpose of carrying on under national ownership any industry or part of an industry or undertaking, as he thinks fit ; and

(b) such other organisations, associations or bodies (if any) as he thinks fit."

Madam Deputy Speaker (Miss Betty Boothroyd) : With this, it will be convenient to consider Lords amendments Nos. 9, 10, 14, 15, 17, 18, 27, 28, 30, 32 and 33.

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12.30 am

The Secretary of State for Employment (Mr. Norman Fowler) : I beg to move, That this House doth agree with the Lords in the said amendment.

May I welcome the hon. Member for Sedgefield (Mr. Blair) to his new post following the reshuffle? Man and boy, the hon. Member for Oldham, West (Mr. Meacher) stayed as my shadow for over six years, and I very much hope that the hon. Member for Sedgefield will have such a happy and long career on the Opposition Front Bench.

The amendments, which we moved in another place, are designed to enable us to change statutory industrial training boards to voluntary employer-led bodies or to employer-led boards. The change is part of the changes to the existing training framework necessary to meet the challenges of the next decade.

The White Paper, "Employment for the 1990s", which we published some months ago, set out the scale of the challenges facing Britain, such as the effect of changing demography--in particular, the shortage of young people--the growth of overseas competition, the changing patterns of employment and changing skill needs.

The White Paper set out the framework required to meet those challenges. In future, training must help business succeed, become the responsibility of employers, provide standards that are set by industry, allow adults and young people to receive qualifications, be delivered locally and be flexible to suit local needs. The commitment of employers is fundamental to that. One of the most encouraging features of the current training position is the strength of employers' response to the training and enterprise councils' initiative.

In the debate on Lords amendment No. 6, the hon. Member for Glasgow, Maryhill (Mrs. Fyfe) asked how many training and enterprise councils had been approved. Although the concept was introduced only last March, 35 TECs have been approved for development funding. Plans for a further 50 are well advanced. Already, over half the working population is covered. In the north-west, there are TECs in Cumbria, Oldham, east Lancashire, Rochdale, south-east Cheshire and Wigan. In my area, the west midlands, there is a major TEC in Birmingham and one in Walsall. There is also one in the north- west midlands. In the Yorkshire and Humberside region, there are TECs in north Yorkshire, Sheffield, Calderdale, Kirklees and Rotherham.

The TECs are covering the country, and there is tremendous enthusiasm for the concept. It would be a great tragedy if we had the normal political knockabout on this concept. The idea is crucial to this country. The TECs will plan and provide training locally, help the training of employed and unemployed people and will give training and enterprise not only a higher profile locally but a much better delivery locally than we have ever had.

Mrs. Mahon : Does the right hon. Gentleman accept that the White Paper acknowledges that, going back to the beginning of the century, the private sector has failed miserably in providing training? We compare very unfavourably with our European counterparts.

Mr. Fowler : The case is not quite as the hon. Lady states it. We certainly need to catch up with countries such as Germany, France, Japan and the United States. The position to which the hon. Lady refers has not suddenly emerged but has been a characteristic of this country all

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this century. [Interruption.] It serves no one to sloganise, least of all to clamour and shout out as hon. Members are doing from a sedentary position. This is a serious matter which requires a serious policy response. Training and enterprise councils are a serious response.

I ask the Opposition to talk to the people who are on TECs locally--the business leaders. The thing that has impressed me most about the TECs is the enthusiasm that has been shown. People who have been involved in training for decades longer than I have noted the new spirit that has arisen over the past few years, not least for demographic reasons.

We need training arrangements that deliver not only training locally but standards in each industry at the sectoral level. In other words, our training system must be founded on standards and recognised qualifications based on competence. Those standards must be identified by employers and be nationally recognised. We need a system of employer-led organisations to identify, establish and secure recognition of standards, sector by sector or occupational group by occupational group.

Such a system of standard-setting bodies will be effective only if employers are committed to it. The Government's objective is therefore to see established throughout industry and commerce standard-setting bodies created by employers themselves, to which they subscribe and which will secure their continuing voluntary support. That approach is far preferable to one of regulation and compulsion.

The statutory system, whatever may have been said about it in the past, has not delivered the goods. Many firms in the few sectors covered by the statutory systems are not happy with performance. The engineering industry training board is an example. The group of 14 major companies in the engineering industry has campaigned against the continuance of the EITB in its present form. The levy system is bureaucratic by any measure, has ceased to be an incentive to train in many industries and is not providing money in that respect. The statutory framework constrains the development of effective commercial operations. The offshore petroleum training board, for example, cannot train workers employed for work onshore because of the statutory limitation on it.

Above all, industry training boards have failed to solve the training needs of their sectors. As the White Paper sets out, we want to move to a system which is based on employer commitment and which is voluntary, and independent and employer led. In saying that employers have the key role to play in securing those improvements, I am not seeking to deny the important part that other groups such as trade unions and educationists rightly play in training matters. However, without the commitment of employers, the good will and active encouragement of others will achieve little. In the vast majority of sectors that already have independent, voluntary arrangements, the views of trade unions are sought and taken into account, and in a range of those sectors, trade unions are represented on the governing body itself, including the glass, aviation, insurance and timber trades and many other industry organisations.

We want to move to a non-statutory system. At present, only seven statutory industry training boards are in existence, compared to over 100 independent, voluntary training organisations. We want to move to a system in which all sectors are covered by non-statutory, independent and voluntary arrangements. Those bodies

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must be able to command the active support of senior management in their sector. They must be seen by their sector as the body with the major role of dealing with Government on vocational, education and training matters, and their most important functions are the identification of key skill and training needs, and the establishment of occupational standards. In that way, they will complement the work of the training and enterprise councils at local level.

When I published the White Paper "Employment for the 1990s", I announced that we would be consulting the seven remaining ITBs with a view to securing their replacement by independent and voluntary bodies. My hon. Friend the Parliamentary Under-Secretary of State has held detailed discussions with all the main employer interests involved. I am pleased to tell the House that employers in the majority of sectors covered by those boards have come forward with proposals for the creation of such bodies.

Those new organisations will be progressively taking over the key activities of the boards covering the sectors of road transport, hotel and catering, clothing and allied products, plastics processing, offshore petroleum and engineering other than engineering construction.

In the case of construction and engineering construction, I have accepted the strong arguments of employers that statutory arrangements should continue there for the time being. There are particular problems in those areas concerned with a highly mobile labour force. In those industries there is much labour only sub-contracting, a high level of self-employment and a high use of short-term contract labour.

I shall be telling the two ITBs concerned that they will be reconstituted for a further three-year period, using the new powers being sought in the Bill, ending in 1993 for the construction industry and 1994 for engineering construction. At the end of that period, the Government will want to review the statutory arrangements.

In the future, there will be significant changes in the statutory boards. That includes the way in which we will wish to move to an employer majority on the boards using powers in amendment No. 10. They will become employer- led bodies but they will be statutory bodies, and the levy powers will continue.

12.45 am

The positive response from employers to my request to develop their own voluntary training arrangements promises well for the future success of the new bodies. They should provide a firm basis for the improvement in our training performance. It was necessary to see the shape of the proposals from employers for the replacement of statutory ITBs--those which are being replaced--before we could draw up appropriate amendments to the Industrial Training Act 1982. The powers we are seeking in the amendments will make it possible to transfer the staff and assets of ITBs to successor bodies so that key functions can be maintained and the continuity of employment of staff secured.

Amendment No. 8 changes the requirement on me to consult before making an order affecting the scope of an ITB. Amendment No. 9 will enable the key activities of ITBs to be continued without disruption during the transition to non-statutory status. It enables a board, with

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my agreement, to pass on its assets to a successor to be used for charitable purposes connected with training for employment. The new clause also safeguards the position of staff involved in such a transfer by extending the application of the Transfer Undertakings (Protection of Employment) Regulations 1981 to them. That means that their existing terms and conditions of employment will be preserved, and that is important.

Mr. Wallace : Will the Secretary of State confirm that that includes existing pension rights?

Mr. Fowler : There are different arrangements for pension rights. This concerns the working terms and conditions. However, I understand that the inquiries that have been made of the boards and their constituent parts suggest that most will want to take advantage of the existing industry training board pension scheme. The hon. Gentleman probably knows that there is an industrywide scheme to cover this issue and I think that staff will continue to use it. These terms do not cover the pension arrangements. There is nothing unusual about that since that has never been the case with such transfers.

Mrs. Mahon : In the previous debate, I mentioned the £60 million that has come from the European social fund and said how useful that has been. Does the Secretary of State believe that we will be able to attract that sort of funding when training is privatised?

Mr. Fowler : I heard what the hon. Lady said during the earlier debate. We are talking to the Commission about that and our intention is to ensure that that is the case. We are well apprised of the issue.

The general purpose of the new clause is to ease the transition from statutory ITBs to a voluntary approach. Firms in the industries affected and the staff of the ITBs involved will benefit from the change to voluntary status being achieved with a minimum of disruption.

Amendment No. 10 changes the balance of interests represented on ITBs, as well as providing the employer leadership that we believe is necessary to improve ITB effectiveness. It will enable the move from statutory ITBs to employer-led successor arrangements to take place more smoothly.

The net result is that in the two sectors in which industrial training boards remain the employer leadership of the statutory boards will provide the basis for the reorganisation and achieve greater effectiveness. I hope that it will also pave the way for the development of voluntary arrangements in due course, but that is not the intent at the moment.

The overall effect of these amendments will be to create the conditions for voluntary employer-led training organisations to flourish. In important sectors of industry employers are now to be given a real opportunity to control and direct the work of their training body. They now have every incentive to play a full part, unfettered by the bureaucracy--perhaps the necessary bureaucracy--of a statutory system.

I agree that it is vital that that opportunity is taken. We shall be publishing a report shortly on research that we have carried out into the amount of funding and resources that are given to training in this country. We estimate that, at the moment, employers are spending about £18 billion per year on training--although those figures are probably

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several years out of date. There is no question but that there is and has been a marked increase in the interest and financial commitment given to training, especially over the past two years, and that it takes account of the demographic trends and changes in the work force.

To myself and to many in the training world, there is no greater challenge in the 1990s than that of providing better training. The difference between nations and companies will be the differences in their skills--and in the skills of individuals. The new arrangements will help to bring about that change, and that is important and necessary for this country.

Mr. Tony Blair (Sedgefield) : First, I thank the Secretary of State for his kind words of welcome, although I find the idea of shadowing him for six years somewhat mind-numbing. In all fairness, I should tell him that my hon. Friends and I had in mind for him the more educative experience of opposition. He should regard the next year as a sort of training scheme for when that occurs, shortly after the next election.

This series of amendments deals specifically with industrial training boards. In 1981 there were 23 industrial training boards, but following a review by the Manpower Services Commission, their number was reduced to seven. The 16 that were wound up were replaced by voluntary bodies that seemed to multiply hugely so that there are now 102 non-statutory training organisations. In the White Paper published in December 1988, the Government proposed the abolition of the remaining seven industrial training boards. The amendments to be inserted before clause 21 in effect pave the way for that abolition The two most controversial candidates for abolition are obviously the construction and engineering boards. As far as I understand what the Secretary of State has told us tonight, both the construction industry training board and the construction part of the engineering industry training board will remain in full in their present form, at least for the time being, and obviously I welcome that.

More generally, it is worth remembering that the boards were set up not because the voluntary sector had succeeded, but because it had failed to provide the type of training that people wanted. It is against that background that we must look at the advantages of the present industrial training board system. The first advantage is that the boards have statutory force--in other words, they have the force of the Government behind them. They are not dependent simply on the good will of individual companies.

Secondly--we believe that this is particularly important--they are tripartite bodies that involve the employer, educational interests and trade union interests. Many employers, believe it or not, accept that trade unions play a vital part in ensuring that training is dealt with adequately.

Thirdly, the boards have levy-raising powers, which, at least for some training measures, are absolutely necessary. In any event, however, those levy-raising powers are, in many cases, the principal source of funds for those training boards. Even where levy exemption procedures apply, the levy exemption is allowed only where certain training

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criteria are met by employers. Therefore the existence of the potential power to raise a levy can act as an incentive to employers for training practices.

Fourthly, tangentially, as a result of the levy, the ability arises to claim from the European social fund. The boards are treated as publicly funded bodies and, therefore, are eligible for grants under the rules of the ESF.

I want to direct my remarks principally to the engineering industrial training board. The 1981 review, "Framework for the Future", that paved the way for the abolition of 16 of the 23 boards that then existed specifically paid tribute to the work of the EITB and said that it had done a job that was irreplaceable by the voluntary sector. What has changed so dramatically between the publication of that Government report in 1981 and the White Paper in December 1988?

I understand that about 550 staff are employed by the EITB. I do not believe that anyone doubts the immense contribution that that board has made to training in the engineering industry, although I am not sure that the Government share that view. It is only right that we pay tribute to the work of that board and to the commitment of its staff to training. The Secretary of State may say that we still have tremendous training inadequacies in the engineering industry and that therefore, in some sense, the board has failed. I believe that the argument runs the other way--what would our training facilities be like but for the existence of the board? Surely that is the test of its effectiveness.

We should regard the levy-raising powers of the board seriously and it is instructive to look at its most recent accounts. Some £20 million of the £32 million revenue of the EITB comes from the levy in one form or another. I shall be obliged if the Minister could confirm that. I do not know many people who believe that a voluntary series of subscriptions could raise the same amount of money and, therefore, perform the same task on behalf of the board. As a result of matching grant from the ESF about £13 million in this financial year will go to the industry, not to the board, for training programmes. My hon. Friend the Member for Halifax (Mrs. Mahon) is correct that £13 million is a lot of money and it is roughly equivalent to half the board's revenue. I appreciate that it is not the same as the board's revenue, but it is a substantial chunk of money which goes to the engineering industry for training. It is unjustifiable to say that the board should be abolished unless there is a clear guarantee from Europe that matching grant will still be available following the transfer to the voluntary sector. It would be extraordinary if we forfeited money that is available for training, especially as my information shows--I should be grateful if the Minister would confirm it--that the matching grant from the ESF assists 25,000 of our people to train.

I know that the board believes that much of the money that goes to training would not be forthcoming from the industrial sector employers. If that money is lost, effectively it will be lost for good.

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