Examination of Witnesses (Questions 1-19)
NORTHERN IRELAND
DEPARTMENT FOR
EMPLOYMENT AND
LEARNING
2 MARCH 2005
Q1 Chairman: Good afternoon. Welcome
to the Committee of Public Accounts where today we are taking
Northern Ireland business because of the suspension of the Assembly
and we are looking at Northern Ireland Department for Employment
and Learning and the Jobskills programme and we are joined by
Mr Will Haire, who is the Permanent Secretary. Would you like
to introduce your two colleagues?
Mr Haire: Thank you very much,
Chairman. May I introduce Heather Stevens, Head of the Skills
and Industry Division and Tom Scott, Head of the Corporate Services
Division.
Q2 Chairman: Thank you, you are all very
welcome. I will start with a general question so that you can
prepare yourself gently in, Mr Haire. Can you look at paragraph
1.12 on page 18 of the Comptroller and Auditor General's Report.
You will see there it is a large training scheme and that £500
million has been spent on it to date. How satisfied are you that
this programme is delivering value for money?
Mr Haire: As the Report emphasises,
this scheme has been able to produce good results in relation
to strategic objectives. It has provided vocational education
to a large number of young people and made sure that we have been
able to fulfil the Government's pledge of a training place for
all 16 and 17-year-olds. 80% of the young people who are engaged
in this scheme come to us with no qualifications which employers
recognise. They will have at most one or two GSCEs at levels D
to G and the scheme does produce for them vocational qualifications.
They come out with a strong range and the achievement and the
participation rate is comparable and higher in some areas than
that of Great Britain. However, on value for money I am not satisfied
in the fact that, as the Report also emphasises and as our recent
statistics would indicate, in a quarter of cases the training
organisations inspected are seen to have more weaknesses than
strengths, and that clearly is the key area where value for money—
Q3 Chairman: I will stop you there, if
I may, and we will now look at some of those weaknesses so we
can find ways of trying to improve this scheme. If you look at
page 36, paragraph 2.36, you will see there that on inspection
results it is possible that one in three trainees currently on
Jobskills—that is some 4,000 young people—are in an
organisation or occupational area where the quality of training
is below standard. How do you justify this astonishing statistic,
Mr Haire?
Mr Haire: Clearly that is what
the regular inspections are telling us now about those areas.
Our most recent work has indicated that from the time of this
Report we have looked at the inspection reports and seen an encouraging
move. We are seeing in 25% of vocational areas; in 1% there was
a grade four, which is significant weaknesses; and in 24% there
were weaknesses over strengths. The clear point is we now are
working—
Q4 Chairman: Have you informed the Committee
of these latest statistics?
Mr Haire: No, I am sorry .[1]
Q5 Chairman: We deprecate Permanent Secretaries
who come to Committee with recent information that has not been
given to the Committee. The whole point of our work is based on
the Comptroller and Auditor General's Report.
Mr Haire: I apologise. The key
point is that we are working through the quality improvement systems
and other systems with these organisations to ensure that we improve
in these processes. Organisations judged in this way have to produce
improvement reports rapidly for the Department. They are inspected
in another 18-24 months and they have to ensure that improvement
is gained. We have also put in place an improvement system similar
to the systems used in Great Britain, the quality improvement
system, where organisations are working through and improving
their approaches to training. So while there are organisations
with those weaknesses we are seeking to improve those as best
we can.[2]
Q6 Chairman: Anyway, we know that a significant
number of young people now are receiving a quality of training
which is below standard. Let us look at how they progress through
their training. If you look at page 46 and paragraph 3.22 that
paragraph deals with youngsters with particular disadvantages.
It says there that on average only 40% of Access trainees actually
do progress and the rate has been falling for some years. That
is figure 9B. This is obviously rather disturbing as these are
some of the people with the greatest problems. What are you doing
about that?
Mr Haire: As the Report notes,
in this area we put in a pilot programme to try and deal with
these young people to give them, many of whom face significant
personal and social problems, training where training in the NVQ
style has not been beneficial to them. We have put in a pilot
initially in four organisations and now in 13 organisations. In
our interim evaluation that has seen significant improvement with
65% of those young people seeing progression, to a positive outcome[3],
the inspectorate is advising us. That will be fully evaluated
this autumn and our hope therefore is out of that next year we
can spread that across the entire system. We have a new system
trying to look at that area.
Q7 Chairman: Here we have a scheme where
the quality of training is often inadequate, we have a scheme
where people are not progressing adequately; now let us look at
premature leavers. If you look at page 21, paragraph 34, it tells
us there that around 50% of trainees leave early, including some
10% departing within the first four weeks. So why has this been
happening and what are you doing to tackle it?
Mr Haire: These young people are
picked up by our careers service and reintegrated into the system
as soon as possible. The head of our careers service is optimistic
that up to 90% of young people will be reintegrated back into
the system and will get back into that process.
Q8 Chairman: But not into the Jobskills
programme?
Mr Haire: Into the Jobskills programme.
Q9 Chairman: So they are coming and going,
are they?
Mr Haire: About 10% of young people
take time to settle into our system.
Q10 Chairman: It says around half of
them leave early.
Mr Haire: Sorry, there is another
group of people who do leave early, they do not complete their
course. Often they will be working with employers and some of
them will leave early for employment, so they are not fulfilling
the qualification, which is obviously the ideal that we would
like to see achieved, but they are getting into employment.
Q11 Chairman: That is the third point.
The quality of training is low, their progression in training
is not very good, and they are leaving early. Let's look at the
next point, shall we. Page 70, paragraph 4.1, says that many Jobskills
participants who leave the programme do not use the skills they
have learned. 29% do not use the skills learned at all, almost
half of all trainees are no longer active in the occupational
area for which they trained. The Audit Office here estimates a
potential skills mis-match of some 36%. So you are giving them
the wrong training, are you not?
Mr Haire: This survey at the external
evaluation[4]
carried out for us before indicated that 81% of the young people
thought that they had been helped into employment by this training.
Undoubtedly there are a number of young people, particularly those
in the lower skilled areas where they are getting rather general
skills where they are not necessarily going into the particular
trade where they started. That is clearly one of the key features
of the training. With the key skills we are trying to give them
literacy and numeracy skills so that they can broadly get into
employment. As the figure in 18B indicates, the young people who
are moving into modern apprenticeships—
Q12 Chairman: I am sorry, all this is
waffle. The fact is that the Report, which you have agreed here,
says that 29% do not use the skills at all. This is a scheme which
has cost £500 million up-to-date and a further 20% indicate
they use the skills a little. This is a Report that you have agreed
to, Mr Haire.
Mr Haire: That is undoubtedly
what the survey of 400 young people did indicate as an issue.
Since this time we have also emphasised strongly that two-thirds
of young people are in our priority skills areas—construction,
engineering, et cetera—and since this time there
has been a strong flow towards those areas. With unemployment
now at 10.6% in Northern Ireland, pretty much the same as the
GB level, we are seeing a better flow into employment.
Q13 Chairman: Let's deal with fraud.
If you look at paragraph 5.19 on page 82, that comes out with
the astonishing statement that as far as you are concerned in
this massive programme no frauds have been identified. That is
simply not true, is it?
Mr Haire: Sorry, no suspected
frauds have been identified by our team other than the one which
is reported in 5.21, except since then on Friday I received another
one and I have submitted it to the police for investigation.
Q14 Chairman: I know, Mr Haire, that
there has been fraud because I have received a letter from someone
dated 15 February who has written to me as Chairman of this Committee.
You have got a copy of that, have you not?
Mr Haire: I have seen a copy of
that.
Q15 Chairman: Even I know that there
is fraud and it says here that over £350,000 has been recovered
following financial inspection for incorrect, ineligible and unsubstantiated
claims. Do you recall, or perhaps you have been told by your fellow
Permanent Secretary that we looked at the Northern Ireland Sheep
Premium Scheme recently? I would say that the link between that
and this inquiry is that there was a weak inspection regime in
Northern Ireland Departments and there is not sufficient emphasis
placed on dealing with fraud. That was fraud on four legs; this
is fraud on two legs.
Mr Haire: We have a dedicated
team which focuses particularly on the youth training programmes.
We work closely with the Audit Office in this area.
Q16 Chairman: You are turning a blind
eye to fraud, are you not?
Mr Haire: Sorry, I am certainly
not.
Q17 Chairman: How can you expect this
Committee to believe that no frauds have been identified?
Mr Haire: Apart from the one referred
to here in 5.21 and the one I mentioned to you before on which
I straightaway took all action to make sure that all the material
was put together and has gone to the police, I am not aware that
our team has found another fraud but these organisations are inspected
thoroughly. 60% of organisations are inspected each year in systems
audits.[5]
Q18 Chairman: You know that this sort
of scheme is precisely the sort of scheme that is most liable
to fraud? You know the saga of Individual Learning Accounts, do
you not?
Mr Haire: Indeed, I am aware of
that issue and that is why we have built up a strong system—
Chairman: It is useless system if it
has not discovered anything. Mr Trickett?
Q19 Jon Trickett: Thank you very much.
I was reflecting whether it was fraud or incompetence since there
is clearly something going seriously wrong in value for money.
If it is not fraud you must have an incompetent operation, must
you not?
Mr Haire: As I stressed, three-quarters
of the training here is adjudged by the inspectorate to be good,
some excellent. In a quarter of the cases there are weaknesses
in aspects of the training, and that is clearly something that
we have to, and we continue to, work on in a range of issues,
not only by our use of contracts. One of the reasons we have improved
significantly, may I say, in a number of areas in the last couple
of years is because training organisations that fail to perform
in vocational areas lose those parts of the contract, so part
of the improvements come from that very strong use of the contract
as is stated in the Report. We are also strengthening the support
for these organisations. Some of these organisations are very
small. We need those organisations because they work in inner
city and urban areas, they have strong community backgrounds and
they link well. We have to help them professionalise. One of the
problems, and this Report and the Educational Inspectorate emphasises
it, is that in small organisations a change of one or two people
can destabilise those organisations so using the skills councils
and using the Learning and Skills Development Agency, we have
to help improve them. I believe that while, as we have indicated,
this is a very important area because of the needs of these young
people, we need to push up value for money. We are very aware
of that issue. I do not believe—
1 Ev 13 Back
2
Ev 14 Back
3
Note by Witness: The ETI survey of the Access Pilot reported
that almost 68% of pilot participants achieved a positive outcome,
ie progressed to further training or employment. Back
4
Note by Witness: Training and Employment Agency, Evaluation of
Jobskills, PWC, May 2000 referred to in the NIAO Report, paragraph
1.14. Back
5
Note by Witness: In any one year the Department's Financial Audit
Support Team FAST visits 60% of training organisations and 95%
of these are satisfactory. In addition there are in-built controls
in the computer-based claims system, manual desks checks are carried
out, and FASTs risk-based financial inspection is further supplemented
by checks carried out by the Internal Audit Review team. Back
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