Select Committee on Children, Schools and Families Minutes of Evidence

Examination of Witnesses (Question Numbers 40-59)


8 OCTOBER 2008

  Q40  Chairman: Do you anticipate a large number of banking apprenticeships imminently?

  Simon Bartley: That was a point that I was going to make, as we should not forget that some of the City of London guilds are still the examination boards for qualifications. The spectacle makers is one such guild, but there are others that do superb training. Most of them train in smallish numbers and cannot get any Government money because of the bureaucracy involved. With regard to the public sector, I would like to mention two areas. There is a bit of the public sector called the armed services, which are really good at training apprentices. If you go to the Army engineers at Chatham or to the Navy, you will see that over the past 10 years or so the military training has been interfaced with technical training and has an output in the private or non-military sector when individuals leave the services, and that offers an example. The Army did it because it was embarrassed by the fact that one in five people sleeping rough on the streets of London tonight used to be in the Army: they went in with nothing and came out with nothing. The civil service, both centrally and locally, could pick up some ideas from that example. If you can train an apprentice as an electrician in the Army, in the current circumstances, perhaps we can learn from some other departments that are not included here.

  Very briefly, we talk about young people as apprentices or non-apprentices, but lots of them went into training that was not an apprenticeship or a degree. That has changed. Two examples are nurses and teachers. In the very recent past, both nurses and teachers tended to get qualified by training schemes in hospitals, which were not necessarily tied in to getting a degree at university. In both cases, lessons can be learned. When we talk about IAG—I have said this before in Barry's hearing—I wonder whether every teacher who gives IAG has a degree but not an NVQ.

  Chairman: We have to give David a chance to come in now.

  Q41  Mr. Chaytor: May I pursue the point that John raised about the economic changes? To what extent will the attempt to revive a national apprenticeship system run up against the rocks of the nature of the changes to the economy over the past 25 years and beyond? There is a world of difference between an economy that was dominated by large employers, traditional manufacturing industries and a strong public nationalised industry sector, which, in reality, took on most of the apprenticeships when we had a viable system between them in the post-war period, and today's economy which is—or was until a couple of days ago—dominated by financial services, retail and, until recently, housing and construction and personal services. I cannot see a cat in hell's chance of fully establishing an apprenticeship system if we assume the main providers of apprenticeships will be the small businesses that dominate today's economy. Simon, you gave an example earlier of the construction industry. The typical small business involved in plumbing, electrics or construction is operating on a pretty hand-to-mouth basis. Companies form and decline. Migrant labour comes in and takes some of the work. The whole structure is so much more deregulated now. How can small businesses plan and afford to take on apprentices when there is not the economic stability and certainty that there was in 1950s Britain? I suppose that that is the nub of my question.

  Chairman: Andy, you start.

  Andy Powell: Yes is the answer. That is why apprenticeships have to change. There have been changes not only in the nature of the industry sector but elsewhere. A while back, people had a job for life. Therefore, going back to Douglas Carswell's point, it was much more understandable for employers to voluntarily take on people because they would be there for life. When we are all expecting at least seven different occupations, let alone jobs, in life, you have to do things differently. At the end of the day, this is about a form of learning which always has been and always will be one of the most powerful ways of learning as it comes from experts and combines theory and practice. Therefore, I would be optimistic, but we have to be innovative and consider ways in which we can cope with the new system. Hence, we have group apprenticeship schemes. In the public sector, one of the employers that won an award for the work they did with us was a school. They allow 10 young people who leave with not ideal GCSEs to come back as apprentices. There are apprentices in IT who sort out all the IT for the school and mentor young people. However, that involves having things such as group apprenticeship schemes and more flexibility in the apprenticeship framework while maintaining quality and other such things.

  Q42  Mr. Chaytor: Would it not be preferable to establish in the legislation the group apprenticeship model as the default position for small employers rather than try to flog a dead horse in persuading thousands and thousands of small employers who are operating on the margins to take on apprenticeships? Would it not be better to say, "This is not on, let us establish a group apprenticeship model to serve the small business sector?"

  Chairman: I am watching the time—

  Andy Powell: I do not know. I would not be convinced by that, but I will pass it on to the plumber where I live. He is a one-person outfit, he has an apprentice, and he may take on another when the business expands. It is a wonderful thing and he believes in it. It is always about choice, making it easier, encouraging and providing support for people to have these new ideas, but at the end of the day, the employer should decide. Some of them will like that close bond, and it is their future.

  Simon Bartley: I will just pick up on that point and then answer your query. I would like to think about it. My gut feeling is to ensure that if it is the default, it does not exclude an individual doing it themselves, as in Andy's example. A lot of small businesses will train an apprentice, and it will be the son or the daughter of the person who runs the small business. Cut that out, and you lose 100,000 apprenticeships instantly. In the last 25 years, in the electrical and building services industry, most of the big companies, which were the old electricity boards, were privatised and stopped training, as did most of the big companies. Look at the top 10 electrical and mechanical contractors in the country and they do not train—NG Bailey is a fine example of bucking that trend. Small businesses have never really trained in proportion to the number of them that there are. Some have done it but the bulk never has. The real core in my sector of apprentices has always been mid-sized family businesses. I suspect that all of you know from your constituencies that mid-sized family businesses are increasingly a thing of the past. Fewer people pass on their business to their son or daughter; they keep the money, play golf with it, invest it in their children's houses. Whatever it is, mid-sized businesses are collapsing around everything we do. If you do that, there is no reason that those businesses will ever invest in training labour to help their son or daughter in the next generation. We have a real other issue along with the things that we have talked about. I go back to procurement, self-employment and the death of mid-sized businesses training, because it is easy to go to an agency and get an electrician for two weeks. Finally, and this is not an anti-immigration comment, it is much easier to find a Polish plumber to come and work with you for three weeks because you have a blip on the number of houses that you have to do, than it is to take on somebody for three and a half years and train them. There is an issue there that must be addressed if we talk about why people are not taking on apprentices.

  Nick Edwards: The point is a very real one. There is a real challenge at the moment in the construction industry where the majority of our apprenticeships lie. The major construction companies do not take on apprenticeships. There is an anecdote that only 14 apprentices were employed on Wembley stadium because companies were on complete time penalties—they were not going to carry people. You can either do it by coercion with the large companies through public sector contracts requiring people to take apprentices, or you do it through financial incentives for the small companies. In the construction industry, most of the apprenticeships at our place come from white van construction business—the small person who is building extensions, refurbishing houses and so on. That is disappearing. The way people finance such businesses is through remortgaging their houses. The remortgaging business is going and instantly we have seen people stopping taking on apprentices because they do not want to carry any extra load. From my position of delivering apprenticeships, the college does very well. We get paid very well to deliver apprenticeships and the employer should also be reimbursed for their training part of the apprenticeship programme. If they saw an impact on the bottom line, they would walk towards it.

  Q43  Chairman: You are a big employer in Lewisham, how many apprentices do you and Ruth have?

  Nick Edwards: Two hundred and fifty.

  Q44  Chairman: That you employ directly, you train?

  Nick Edwards: Yes, we train.

  Q45  Chairman: Is that typical of an FE college?

  Nick Edwards: In London it is, but in the midlands and the north you will have colleges with 2,000.

  Q46  Chairman: This is a different question. How many people do you train for your institution?

  Nick Edwards: For our own institution we have 32.

  Chairman: Even that is quite extraordinary, is it not? I hear what you say, but at least two of you have been in meetings with me in the Skills Commission where Chris Humphries will always say, "Don't get carried away by SMEs." However much you love them, the real employers, the bulk employers are still the big players. We are in danger of getting this out of proportion. The big players in most of our constituencies are the universities, local government, the health authorities. They are the places where we have to look for apprenticeships, if they are going to expand.

  Q47  Mr. Chaytor: Your apprenticeships, Nick—the 250—are what are called programme-led apprenticeships?

  Nick Edwards: They are people who come to us to do the technical certificate. We contract with them and they are in the workplace. They come as individuals, they already have work and their employer is sending them to us to do an apprenticeship programme.

  Q48  Mr. Chaytor: Right, so how is that different from a programme-led apprenticeship? Are there still such things?

  Nick Edwards: There are programme-led apprenticeships and we also do those. We take young people and give them the skills to make themselves useful in the workplace before they go out into employment, because, actually, the employer wants people who are partially skilled and who have industry knowledge already. That is programme-led. There will be people who have already secured employment within a particular vocational area, and the employer will send them to us to get them up-skilled and put them on an apprenticeship programme.

  Q49  Mr. Chaytor: But in the context of an economy that is facing a downturn, particularly in construction, over the next two or three years certainly, do you see the programme-led apprenticeship model as being more valuable? Is that the only way that the numbers will be delivered?

  Nick Edwards: No, because in the end, although you can start off with a programme-led apprenticeship, the individual has to get employment to get the apprenticeship. Otherwise, you will end up with a bottleneck of disappointed people and you will just convert them on to NVQ programmes. Yes, they will have the qualification to work in the sector, but they will have lost the aspiration that they had in coming for an apprenticeship, and you will have disappointed them because you could not get them employment. Our college is a large vocational college with 15,000 students. I send more people to university than I can give apprenticeships to. At the moment, my numbers are capped by the LSC, in terms of 16-18s and 19-plus, but the LSC will fund me for every apprentice I can get. It is an open book, but we cannot get the employers. The growth for FE and for training providers is to grow the apprenticeships, because that is where the business is. That is where the money is, so everyone is walking towards it, but the challenge, as Simon and Andy are saying, is getting the buy-in from employers.

  Andy Powell: The programme-led—I am not sure that I am happy with the phrase—is something to be careful about. I sense that at the moment there is a sort of groundswell of received wisdom that these are awful, and I think that you have to look at them carefully. Actually, you could argue that programme-led is a well-established model. This is what doctors and lawyers did: they did the theory, then the practice. At the moment 14% of apprenticeships are programme-led, which is not a huge amount. I am told that some of those are clearly inappropriate, but they are not necessarily inappropriate, providing that they lead to the workplace and employment. We should not make blanket statements such as, "Oh, the programme-led are rubbish," or whatever.

  Q50  Mr. Chaytor: Two other things. First, on the question of transferability, what is the problem in making it easier to move between the diploma and the apprenticeship? Why are not diplomas structured in such a way that transferability to an apprenticeship is almost automatic?

  Simon Bartley: I could give a very long answer on that, but I will not. The two are not parallel courses of learning. The diploma is really an academic qualification that teaches maths, English, physics or whatever in an applied manner. It does not actually teach people the skills required to do a job. An apprenticeship, even the theoretical bit of it, is all about teaching the theory to enable the person to do the job. There will be items in a construction and built environment diploma that would assist, but it is not of the same volume and if a person on a diploma spends only two weeks in the workplace, they do not pick up an enormous amount of practical skills. To give somebody two weeks' worth of credit against an NVQ Level 2 apprenticeship or a Level 3 apprenticeship is so small as to be meaningless in the accreditation of prior learning. When the Government designed diplomas, the idea was that they should not be pathways from a construction diploma into a construction job. They should be a way of learning what you should learn at school, using construction, which may be your interest, to develop your interests and help you to learn. I suspect that, if you were to ask me in five years' time whether that ambition was being fully fulfilled, my answer would be no. I believe that those young people who decide to do a construction and built environment diploma are those with more of a predisposition to do an apprenticeship in construction and built environment. However, we are two or three weeks into it, so let us watch what is going on.

  Nick Edwards: A diploma will give a knowledge of industry, while an apprenticeship will give the skills of industry.

  Q51  Mr. Chaytor: That reinforces the point that the two ought to be integrated. What is the purpose of segregation?

  Andy Powell: Top down, to many young people whom I have met, including my son, a diploma—the application of things—would really turn them on and excite them more than sitting reading books. My son is all right at that, but he does not enjoy it. However, he is not in a position to say that he will take an apprenticeship. He does not have a clue what he wants to do nor does he have a love of a particular area. That is fine. If he were to do a Level 2 diploma in, say, health and social care, and said that he really liked it, it is important to make provision in the Bill for him to go on to do an apprenticeship. The reality is that he will have to go back and do a Level 2 apprenticeship, but that is life. That is fine. It should be catered for, and funded, because different things are involved. That is no different for all of us in life. We must avoid the idea that learning is just going one, two, three, four. All of us who want to learn IT go back to Level 1.

  Q52  Chairman: I know that Simon has to go shortly and there is one question to which we would like an answer. We must also give him a chance to comment on careers education. I wish to reinforce what is being said about transferability. I think that Nick Edwards spoke about the difficulty of using Train to Gain money. Why cannot Train to Gain money be used to encourage employers to take on apprenticeships?

  Nick Edwards: Train to Gain will fund only the NVQ. Initially, it was to fund the first Level 2 NVQ for a learner, but now the new flexibilities are saying that people who already have Level 2 can study additional Level 2. However, it funds only the NVQ. It will not fund the component parts of the apprenticeship framework, which are the key skills and the underpinning knowledge.

  Q53  Chairman: So should the Bill say something about that?

  Nick Edwards: It should refer to the fact that we have two initiatives for employers to train in the workplace. One is Train to Gain, and one is apprenticeships. They need to have a dialogue with each other because employers will say that they have to do only the NVQ, not the key skills or the underpinning knowledge, and that it is free. They would ask why they had to do the apprenticeship when it would mean more responsibilities for them and, post-19, they would have to co-fund it, whereas under Train to Gain Level 2 would be free at 19-plus, 30-plus or 50-plus.

  Chairman: That is a very important point.

  Q54  Mr. Chaytor: On another topic, the apprenticeship wage is less than the minimum wage. Is that true? Is that an issue?

  Nick Edwards: It can be.

  Q55  Mr. Chaytor: Is it not fixed? Are there fixed amounts? How does it work?

  Simon Bartley: It is age dependent. If you are a 17-year-old apprentice, your employer has only to pay you a percentage of the minimum wage. I do not know the figures, but they are publicly available.

  Is it an issue? A lecturer at the London School of Economics did some work on that for the Skills Commission. Some people think that reducing the wage of an apprentice would attract better people to participate in apprenticeships, and that more employers would be prepared to take on apprentices. Others think the absolute opposite and say that such a situation is disgraceful and that an apprentice should be paid a working wage—the minimum wage without a cut-off—because that would encourage better people to participate. My understanding of Hilary Steadman's involvement is that there is a little bit of "the jury is out" on that issue, but a review is ongoing in DIUS about it.

  Andy Powell: A middle way is that some would say they should start smaller but grow, as an encouragement for the employer, to check out the employee and for retention.

  Simon Bartley: We used to lose some three-year apprentices because we paid them only 90%. of the electricians' wages. It was above the minimum wage, but they knew that they could go off and get another 10%. and no one would ask them for their NVQ. That is a lack of licence to practise argument, but, in general, it is quite good to have a step up so that people stay in training for completion. It is a complicated issue.

  Q56  Mr. Chaytor: On other financial support for the employer, Nick, you said earlier that you felt that colleges were paid quite adequately by the LSC for apprenticeships. What is the standard payment to colleges and to employers?

  Nick Edwards: You want to know what I get for delivery?

  Q57  Mr. Chaytor: Is it a secret? Is there not a standard rate offered by the LSC?

  Nick Edwards: There is, but it depends on the apprenticeship and on how much of the framework that I deliver—if I deliver key skills and a technical certificate, or just a technical certificate, and so on. I can get about £3,000 for a learner for a year.

  Q58  Mr. Chaytor: How does that compare with an employer who takes on an apprentice? Does the employer receive anything at all?

  Nick Edwards: He's not getting anywhere close to that.

  Q59  Chairman: Hang on. He's not getting anything—nothing. You said, "He's not getting anywhere close to that."

  Nick Edwards: That is right.

  Simon Bartley: An employer will be given money by the LSC to take on an apprentice. That money will cover the whole college expenditure if I, as an employer, have to send an apprentice to college or pay the college fees for the technical certificate and key skills, for examination fees and such like, and for some monitoring of the NVQ logbook and evidence. It does not pay any contribution to the apprentice's wages, so, over three and a half years, you can imagine that it makes the rest of the money pale into insignificance. That is the bit that employers do not get.

  Chairman: We have to do a bit on careers.

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