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23 Jun 2009 : Column 180WH—continued
Many adults with low skills will not return to formal education in the classrooms of colleges and schools. To increase skill levels in the most disadvantaged communities, it is often necessary to invest directly in mentors who
will work with people who need to be encouraged and pointed towards ways out of the various poverty traps that low wages and the benefits system combine to create. Fortnightly trips to the jobcentre to sign on and work-focused interviews are not likely to make a difference to people on the ground. In contrast, someone who will devote a couple of hours a week for a sustained period to a specific individual will help that person to take that next vital step. It is a case of taking the mountain to Mohammed.
To make an impact, intensive outreach is vital, and local delivery is key. If capacity to address low-skill adults is to be effectively built, more needs to be done in the local communities in which they live. That could involve support for people to move back to work via local community enterprises, which allow men and women to enter employment where they learn new skills and at the same time make a real contribution to their community. Such projects are good at moving individuals forward at their own pace and providing a springboard for further training and long-term employment.
There are good examples in the report of community-based support activities such as Big Tick in Pontypool, Ways2Work in Doncaster and Kingdom Homes in Fife. They show how, by providing general training for low-skill adults in suitable settings and locations, training agencies can get involved and take an active, community-based approach to engaging people. Provision should be delivered where people live. That is the best way to make them go forward. One size does not fit all, but a local solution will work best.
As I said, the statistics reveal major regional and local differences in the proportion of adults with low skills or no formal qualifications. What is more, the geography of low skills shows strong similarities with the geography of deprivation. Against that backdrop, population-driven funding formulas make little sense, because population in such areas is decreasing. In the context of funding for adult basic training, what matters is not the total number of people in an area but the number who have low or no skills.
The older industrial areas of Britain that all too often are still struggling with a major problem of low skills need to be given priority in the allocation of resources. Funding and effort has to be concentrated on the communities with the biggest problems; otherwise, they will be left behind yet again. Ultimately, we need to direct jobs at those areas. If job opportunities are not focused on such areas, it will be even harder for people to move forward.
There are opportunities in this country, certainly in the area where I live. Like everyone else, we are going through tough times, but good things are on the horizon. There is a huge opportunity in the north-east to develop new jobs based on the potential of carbon capture and storage. There is huge interest among companies such as Nissan in developing electric cars, and there is a massive opportunity for offshore wind power, but the truth is that many of the people whom I have been talking about for the past 25 minutes—a long time—will not be able to take advantage of those jobs. Unless we address that agenda, we could well see people moving from one highly paid job to another while the people who are not in work do not get into work.
I urge the Minister to support our campaign. I realise that I am making a special case but I make no apology for that. I ask him whether, as a result of the debate, we might have a discussion with the people who produced the report so that we can find a way forward together.
9.55 am
Paul Rowen (Rochdale) (LD): I congratulate the hon. Member for Blaydon (Mr. Anderson) on securing this debate and on an excellent introduction. He set out clear policies for dealing with the skills gap in the older industrial areas. Rather than repeat much of what he said, I shall make a few specific points about some ways in which the Government could be more effective.
The predominant employment in the area that I represent, Rochdale, was based not on coal, as in the hon. Gentleman’s area, but on light engineering and textiles. Much of that has disappeared since the 1980s, but the problems remain. As he said, a large number of adults are low skilled and are working in low-skilled jobs or are unemployed. The question is: how can they get into employment or retain their job?
A key issue is that, in the areas that we are discussing, the majority of employment is still in manufacturing. Many other areas have moved to so-called high-skilled, high-technology jobs, but, in most of the areas that we represent, a large part of the employment base is still very much in traditional manufacturing. One of the biggest problems that I come across when I speak to local employers is that, up until now, the Government simply have not had a proper strategic policy for securing the manufacturing base. Until recently, far too much emphasis has been placed on making money in the City, and we have seen where that has gone. What manufacturing we do have is high skilled and high tech.
David Taylor: I strongly agree with the hon. Gentleman’s remarks. I represent a constituency in the east midlands region, which, of all the regions in the country, has the highest proportion of its gross domestic product linked to manufacturing. It can survive and thrive, particularly when it focuses on the high-skill or niche end of the spectrum.
Does the hon. Gentleman agree that one of the problems that we have seen over the past 12 years has been that the framework for training—the old training and enterprise councils and then the learning and skills councils—has not been appropriate, adequate or, as the description goes, fit for purpose? Has he any ideas on how we could reform it so that we can realign what is available to the new economy that lies outside, in the way that many east midlands firms have been able to do?
Paul Rowen: I agree with the hon. Gentleman that the system that we have had so far with TECs, the LSC and the soon-to-be skills forum has been far too complicated, as the hon. Member for Blaydon said. We need to streamline and clarify what is available. I agree with the hon. Member for North-West Leicestershire (David Taylor) that we have high-tech manufacturing.
In the current recession, there are two parts to the argument about what needs to be done. One that I would like to spend a bit of time on, which the hon.
Member for Blaydon did not mention, is how companies can secure and maintain employment for people who are already in work.
In April, the Government launched the golden hello and offered to pay employers up to £2,500 to employ new people. For most of the employers whom I have spoken to in Rochdale, that is a non-starter. They are struggling to maintain the employment that they have. They are struggling to keep the people who already work for them in work. They are lean, mean outfits, and they cannot afford to lose the employees they have now, most of whom are multi-skilled.
Jim Sheridan: I do not disagree with the hon. Gentleman’s comments about trying to maintain our traditional industries, but the Government have taken positive action. In the current climate, all politicians are portrayed as being the same and it is thought that politics do not matter, but I know from personal experience that the Government saved shipbuilding on the Clyde. It was on its way out and its jobs were going, but the Government’s positive intervention saved it, and that is a traditional industry.
Paul Rowen: I do not disagree with the hon. Gentleman, and I have no intention of saying that what the Government have done is wrong. I am trying to point out areas where they could be more supportive. I want to show hon. Members what we can do to maintain employment in the industries that we have—those that are struggling for orders and have people on short-term employment.
I was given an example by a local ball bearing manufacturer in my constituency whose only major competitor in Europe is a company in Germany. The company in my constituency is struggling because Germany is assisting its workers, as is Wales, by paying employers for short-term employment schemes that allow retraining so that workers can be further upskilled. I would like the Government to adopt such schemes nationwide—Wales already has the ProAct scheme—because offering money for workers to undertake further training and paying companies for them to do so would guarantee continued employment for many workers. Employers who operate mean, lean outfits have multi-skilled workers and cannot afford to lose one or two because their whole production might be affected. I would like the Government to do more about that.
My second point concerns the Learning and Skills Council, which has messed up the further education college reorganisation. In that regard, the hon. Member for Barnsley, West and Penistone (Mr. Clapham) and other hon. Members have similar problems to those experienced in Rochdale. Colleges were promised money to reinvest and rebuild, but the LSC’s mismanagement has resulted in many of them not knowing where they stand. Areas such as Barnsley, Rochdale and Blaydon, which have a large skills gap, need modern colleges that can deliver apprenticeships—I pay tribute to the Government’s reinvention of apprenticeships as a way forward for many young people—but they also need money and investment. The LSC delayed decisions at the beginning of June, and we need to see a way forward. Support must be targeted in such areas because if we are ever to deal with the skills gap, investment in facilities and modern colleges is the way forward.
My third and final point is about another area where the Government can help to secure the employment base. When the Chinese cockle pickers were tragically killed in Morecambe bay, legislation was introduced to prevent exploitation of workers by gangmasters. I was told last week that sweet manufacturers in Yorkshire, Greater Manchester and Lancashire are employing workers at below the minimum wage, and that a small sewing company in my constituency is under threat of going to the wall because larger companies are exploiting cheap labour and taking work elsewhere. Extending the gangmaster legislation to include a wider range of industries would do a lot to secure the employment base.
Beyond that, the Government’s policy on working with local authorities to draw up employment schemes is the right way forward, and Rochdale is playing its full part in drawing up plans with local employers and Jobcentre Plus to ensure opportunities for our workers. The next few years will be difficult. The areas that we represent are well used to hardship and difficulty, but with some small changes the Government could do a lot more to help those areas.
I apologise for having to leave the debate early to attend a Statutory Instrument Committee at half-past 10.
10.5 am
Mr. Michael Clapham (Barnsley, West and Penistone) (Lab): I congratulate my hon. Friend the Member for Blaydon (Mr. Anderson) on securing the debate, which is particularly important for older industrial areas and the people who live there. I want to make three brief points.
First, I want to discuss how to break the cycle of generational unemployment to improve people’s life chances in areas such as Barnsley, Blaydon and Rochdale. Secondly, I shall refer to further education colleges and community colleges because they are crucial to the regeneration of older industrial areas. Barnsley college is particularly important. Thirdly, I want to emphasise the need to create jobs in older industrial areas. If we are to end generational unemployment, it is crucial to have the jobs to do that. As my hon. Friend said, evidence clearly shows that the UK’s older industrial areas have too many men and women with low skills.
Barnsley was once the centre of coal mining and the heavy industry associated with it, but it now has a great deal of worklessness, and many people have been unemployed since the collieries closed in the 1980s. It is important to remember that in 1983 40 per cent. of people who were employed by the National Coal Board, or British Coal as it became, were tradesmen, but those skills have not transferred to other industries to help to create jobs as those industries have grown. Consequently, we have high levels of unemployment, particularly among the age groups to which my hon. Friend referred—people over 35 and over 50. The prospects for unskilled workers who are unemployed are bleak in areas such as Barnsley. Many of the Government’s initiatives have, sadly, missed those groups, and in the current economic downturn their prospects are bleak.
The message that I want to get over to the Minister is that men and women with little immediate prospect of contributing to the knowledge-based economy must not be forgotten. Many initiatives have been good, but they have missed the people whom they were intended
to win over. As we move from the economic downturn—there are indications that that is happening—we must concentrate efforts on how to equip the most disadvantaged people in our areas with the skills and qualifications that they need to engage with the world of work.
Long-term unemployed people must be included in the effort to get people back to work. We seem to have missed that large number of people. Unless we tackle the problem meaningfully in older industrial communities, they will become a breeding ground for the extremism of the British National party. Already two BNP MEPs have been elected to the European Parliament. The support that they have received from older industrial areas has helped to elect them. That is a very sad fact. In tackling the economic situation, we must be aware of that, be moderate and create an understanding that leads people away from the BNP.
My hon. Friend the Member for Blaydon talked about initiatives having to be local if we are to encourage people to take the first step towards coming back into learning and the jobs market. It is crucial that we have local initiatives, because many of the people we are trying to reach have low levels of confidence and self-esteem and it will be a slow process of mentoring, as he said, to get people in older industrial areas back into work. Further education colleges and community colleges are crucial to that.
The Barnsley college property strategy was formally “approved in principle” by the Learning and Skills Council as early as July 2007. In November 2008, the LSC regionally approved the redevelopment of what is called the old mill site. That is the main college building. It was demolished, ready for construction to start in June 2009, but, appallingly, the project is currently being held up, awaiting a national decision. The LSC national council met on 3 June, but to date the college has not been advised whether it is on the shortlist for resource allocation. In the meantime, the site stands shovel-ready, as they say, but work cannot start until there is a decision at national level.
So far the college has spent £10 million on the project, with LSC approval of the strategy. The planned building was to cost £42 million. That has now been revised downwards to £33 million, and here we are, still awaiting a decision. The decision is crucial to Barnsley, because if we are to deal with the skills issue that we are talking about, the college’s input will be vital.
I refer the Minister to how the college has performed in these very difficult circumstances. The college is at the heart of Barnsley’s regeneration plans. Students and staff are in temporary accommodation. Further delay of the project will have a significant negative impact on students. The college is so important that 75 per cent. of young people in Barnsley go to it. It is terrifically important for employer-based skills training in the town and surrounding area. I therefore hope that he will do his best to ensure that the LSC is made aware of the critical situation in Barnsley to help to ensure that resource is made available.
The college’s results in these difficult circumstances show clearly the importance of its strategy of working with local people. The results of the Ofsted visit in March 2009 showed that the college was one of the best colleges nationally. Early results suggest that the college
will be significantly above the national average for the academic year 2008-09. It is a tertiary college—a sixth-form college as well as a college dealing with vocational studies. Those results have been achieved in enormously difficult circumstances. As I said, I hope that the Minister will do his best to ensure that Barnsley receives the necessary resource so that the college can play its part in regenerating the area.
Mr. John Hayes (South Holland and The Deepings) (Con): I am interested in the hon. Gentleman’s point about the capital crisis and Barnsley in particular. Will he let the Minister know, because it would be helpful, whether the college was encouraged by the Learning and Skills Council to expand in the way that he described? The story that I hear from colleges across the country is of exactly that happening. Is that the circumstance in Barnsley?
Mr. Clapham: That is the circumstance. The college has set out to increase the number of 16 to 18-year-old students as well as adult students. The whole strategy was, as I said, approved by the LSC as early as July 2007. That was given further, reinforced approval in November 2008, leading the college to go ahead with demolition in the belief that it would have the resource to start building a new college this month.
The provision of job opportunities is perhaps the most important aspect of dealing with worklessness and unemployment in older industrial areas. Under the drive of the global economy, there is little doubt but that the UK has a particular problem in providing the right skills for a dynamic and quick-changing economy. Academic qualifications can be addressed, but that is only part of the problem. Apprenticeships and high-quality vocational training can also make their contribution. However, job opportunities must be created if the gap in living standards and well-being between the south of England and the older industrial areas of the north is to be bridged. The recession has highlighted the potentially catastrophic prospects for older industrial areas such as Barnsley if we do not create job opportunities.
The way forward is to work with the regional development agencies to build a strong economic base throughout the UK. Using the RDA architecture, the Government must target resources to create job opportunities in all the older industrial regions. Training and apprenticeships are important, but without job opportunities we have a recipe for generational unemployment in areas such as Barnsley, and we must break that cycle.
Now is the time to invest in the green economy and to bring new opportunities to older industrial areas. Yorkshire Forward—the RDA that covers Yorkshire and the Humber—is pressing for a massive carbon capture and storage project in Yorkshire and the Humber. On the RDA’s estimation, that would create 50,000 jobs and stimulate the steel and engineering industries. It is the type of project that we require in Barnsley if new skills and training are to be married meaningfully to job opportunities. That will help to break the cycle of generational unemployment in the region. It will bring the people of the area high-quality jobs, with new training and skills. It will be the type of project with which the new apprenticeship schemes will fit neatly.
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