“We will seek ways to support the creation of apprenticeships, internships, work pairings, and college and workplace training places as part of our wider programme to get Britain working”.

It is worth noting at the outset what is meant by an apprenticeship. Basically, it is a paid job that incorporates both on-the-job and off-the-job training. When someone has completed an apprenticeship, they will have a nationally recognised qualification.

In response to the shadow Minister, I said that I had personal experience of this, and I do. Using the definition of an apprentice as someone who learns and earns at the same time, that is precisely what I did for 10 years after I left school. Rather than going to university, I

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joined a local firm of solicitors as a trainee legal executive, for which I was paid a wage. As my hon. Friend the Member for Shipley (Philip Davies) said, in the past being an apprentice often meant starting at the bottom, which is exactly what I did. I was one level up from the office junior, as I used to say at the time.

I then went out on day release to study in the afternoons and evenings for examinations under the auspices of the Institute of Legal Executives. As part and parcel of its training requirements, a person could not become a fellow until they had been employed for eight years, to ensure that they had a thorough and grounded knowledge of the processes. It was a nationally recognised qualification. I used it, along with the degree I studied for at the same time through correspondence from London university, to go on and work for two more years as an articled clerk, which is really just a different term for an apprentice solicitor, before qualifying as a solicitor.

The shadow Minister, having launched his personal attack on me and used a clever way to name my opponent at the next general election, has now left his place on the Front Bench, but I think it is fair to say that I have personal experience of working, learning and earning at the same time.

Public procurement contracts should be awarded on the basis of value for money. Even without the Bill, projects already promote apprenticeships. Crossrail will deliver over 400 new apprenticeships through its supply chain over the lifetime of the contract. All main works contractors will create one new apprenticeship, or the equivalent training opportunities, per £3 million of spend. Crossrail is working in partnership with the National Apprenticeship Service to support contractors in delivering the apprenticeship programme.

The National Apprenticeship Service was established in April 2009, under the previous Government. It has overall responsibility for apprenticeships in England. It promotes apprenticeships to employers and those seeking to take up an apprenticeship by providing support throughout the recruitment and training process. It maintains a national online apprenticeship vacancy system that allows employers to post vacancies and aspiring apprentices to search and apply for them. It is interesting that a requirement to post an apprenticeship through NAS is not included in clause 2.

Apprenticeships have changed considerably in recent decades. There are now over 200 different types of apprenticeship available across a variety of sectors, including: agriculture, horticulture and animal care; arts, media and publishing; business administration and law; construction, planning and the built environment; education and training; engineering and manufacturing technologies; health, public services and care; information and community technology; leisure, travel and tourism; and retail and commercial enterprise. Virtually no aspect of Government procurement does not fall within one of those sectors.

Each apprenticeship is made up of three elements: first, the national vocational qualification, which examines work-based skills; secondly, a technical certificate, which examines theoretical knowledge; and, thirdly, key skills, which examine transferable skills—for example, numeracy and literacy.

Apprenticeships can be studied at different qualification levels, starting with basic, intermediate level 2 apprenticeships, equivalent to A*-to-C GCSEs.

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Above those are advanced level 3 apprenticeships, equivalent to A-levels. Finally, there are higher level 4 apprenticeships, equivalent to a Business and Technology Educational Council professional diploma or a higher national certificate.

The rationale behind the Bill is well intentioned—to encourage more companies to provide apprenticeships. However, I am not convinced that the way to do that is by passing such legislation as this. The way to create a more skilled, better qualified work force is to have a growing economy in which companies can compete in the global marketplace. When they want a larger work force, they can train people using the apprenticeship route, working with the Government to set nationally recognised standards and with a training provider to which they can send their employees for off-the-job training. The companies themselves train them on the job and give them work.

The latest figures show that there has already been a significant increase in the numbers—

Madam Deputy Speaker (Dawn Primarolo): Order. I have been closely following what the hon. Gentleman has been saying. He has made his preliminary remarks and discussed extensively apprenticeships and the different definitions. Now I would like him to relate his comments to the Bill; he has been speaking for 32 minutes. This is not a general discussion about apprenticeships.

Mr Nuttall: Madam Deputy Speaker, I will. The rationale behind the Bill is that there are not enough apprenticeships; that can be the only reason for the Bill. However, official data show that last year more than 500,000 apprenticeships were created, which demonstrates one of my arguments for opposing the Bill.

Madam Deputy Speaker: Order. The hon. Gentleman has just put very succinctly his point about the Bill. I am asking him to make sure that all his comments refer to the Bill with the same clarity, rather than referring to every industry that might offer apprenticeships.

Mr Nuttall: Thank you, Madam Deputy Speaker. I will try to be as succinct as I can about the points I want to make about each of the clauses.

Clause 1 deals with apprenticeship requirements. It is the key clause because it states that when a public authority, defined as

“any body or person discharging functions of a public nature, including local authorities”,

prepares to issue a relevant contract—that is, one exceeding a total of £1 million—it must

“give due consideration to the relevant guidelines”.

We have not heard much about those relevant guidelines, but they were published by the Office of Government Commerce in 2009 in a document called “Promoting skills through public procurement”. It is a long document, but I want to refer to one particular sentence. The document goes through the process that a public body has to follow in granting a tender. It says of the stage at which the contract is granted:

“It is at this stage that public authorities should”—

I am afraid that the document is not written correctly because there is a word missing; I think it should say “should meet”—

“Regulation 39 of the Public Contracts Regulations 2006”,

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which states

“that contracting authorities ‘may stipulate conditions relating to the performance of a public contract, provided that those conditions are compatible with Community law and are indicated in the contract notice and the contract documents or the contract documents’.”

Clearly, the 2006 regulations contained in the guidelines mentioned in clause 1 already give local authorities the power that the Bill seeks to give them in order to do all the things the hon. Gentleman would like them to do.

The second part of clause 1 would require that an authority “may specify” that

“a minimum proportion of the apprentices employed by the contractor are higher or advanced”

apprenticeship level. Because of the use of the word “may”, that could equally mean “may not specify”. The provision is therefore completely superfluous, irrelevant and unnecessary.

“Apprentice” is defined in clause 4 as having

“the meaning given in section 32 of the Apprenticeships, Skills, Children and Learning Act 2009”.

I thought that I would have a look at that to see what the definition is. It gives a definition not of “apprentice” but of “apprenticeship agreement”, which is not what one would expect from reading clause 4. If the Bill receives a Second Reading, that should be looked at, because clearly some clarification is needed regarding the definition of “apprentice”.

Clause 2 deals with the advertising of work force vacancies. In an intervention, the hon. Member for Denton and Reddish said, “You must be in favour of that”, but it is not as straightforward as that. In some cases, these contracts cover the whole country. Does he intend that, if the contractor needs to take on half a dozen extra workers as a result of getting the contract, they should advertise every single one of those vacancies across the whole country? That is what the clause would mean if taken literally, and of course one has to take it literally, so, if it is a national contract, that is what the contractor would have to do. As the hon. Gentleman himself admitted, this is the one clause that is mandatory, because it

“must require the contractor to…advertise all vacancies”

in local jobcentres.

Another aspect is that many local newspapers rely on job adverts to survive in this day and age. I wonder what they would think of this provision if they suddenly lost their local job adverts as a result. The first thing that many people do when they are looking for a job is to turn to the local paper.

Barbara Keeley: What does the hon. Gentleman have to say about the situation with our local paper, which is not delivered to all parts of Salford? A lot of postcode areas do not get a paper and if the jobs were not advertised at the jobcentre, the people who live in those areas, most of which are deprived, would not see them.

Mr Nuttall: I think the hon. Lady is referring to a free paper, but what I had in mind was a paid-for paper. Either way, any jobseeker who is anywhere near half-interested in finding a job will not find it beyond their wit to get hold of a paper.

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Mr David Hamilton (Midlothian) (Lab): On the question of a paid-for paper, my area has a population of 80,000, but the local paper’s circulation is only 7,000. The jobcentre is the only place that most people can get it.

Mr Nuttall: The point remains the same: a jobseeker would look in the paper whether it is delivered to their home or whether they read it at a friend’s house, a jobcentre or a library. The point is that they would still look in a local paper.

Philip Davies: Is not the issue more complicated than that? Many people who may be interested in pursuing an apprenticeship might not go to the jobcentre to look for an advert. Someone who is doing their A-levels and considering the next stage of their education—they might be thinking about going to university to do a degree—might never go to the jobcentre, but if they saw a particular opportunity advertised, they might think, “That might be better for me than going to university.” Is it not the case that advertising at just the jobcentre would be of no use to many people?

Mr Nuttall: My hon. Friend makes a good point. The clause is restrictive. It suggests that all an employer would have to do is put an advert in just the jobcentre and they would then think that they had discharged their duty. They would not necessarily feel that they should advertise any wider than that, because that is all the clause requires them to do.

Andrew Gwynne: Surely the hon. Gentleman is not arguing against the logic he voiced earlier when he said that he supported small businesses? He seems to be saying that they should be compelled to advertise apprenticeship positions in the local papers, which would involve many requisite costs.

Mr Nuttall: I am not suggesting any compulsion. It is the hon. Gentleman’s Bill that suggests that small businesses must advertise.

Andrew Gwynne: In jobcentres.

Mr Nuttall: I am not suggesting that small businesses should be forced to advertise in a local paper. I am suggesting that, given that the Bill requires them to advertise in a jobcentre, they might then not advertise in a local paper.

Philip Davies: Is this not the difference between our attitude and that of Opposition Members? Their nanny state approach is to say that employers cannot be trusted to advertise in a way that will help them find the right person for the job. Surely we can trust employers to advertise in a way that helps them find the right person for their business. We do not need the nanny state approach of the Labour party.

Mr Nuttall: Any employer seeking to take on new apprentices or, indeed, new employees will want to cast their net as widely as possible. When I was an employer, we routinely advertised in the paper and at the jobcentre, because we wanted as many people as possible to see the advertisement, which is what any form of advertising seeks to achieve. This is not the worst clause I have ever

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seen, but I do not think there is any need for it, because any employer looking for new staff would automatically seek to cast their net widely.

Clause 3 states:

“Skills training provided by the contractor must form part of a nationally accredited scheme.”

Anybody who knows anything about the current form of apprenticeships will be aware that they result, by definition, in a nationally recognised qualification, whether it is at level 2, level 3 or level 4. I am therefore not sure what is added by clause 3.

The Government have done a lot to develop apprenticeships since taking office. They asked Doug Richard, an England-based Californian entrepreneur, to look in great depth at how the apprenticeship system was working. Hon. Members may remember that he came to prominence as a dragon in the first two series of the BBC’s “Dragons’ Den” programme. In 2008, he founded the School for Startups, which is an enterprise that teaches entrepreneurship in partnership with UK universities, the Royal Institution and the British Library.

The Richard review, which was produced in November 2012, is a substantial piece of work. Doug Richard spent months speaking to apprentices, employers and Government organisations. He highlights the problems that have developed in the apprenticeship system. The Government carried out a substantial consultation process for several months over the summer, which involved seven workshops covering assessment, qualifications and—

Madam Deputy Speaker (Dawn Primarolo): Order. I am afraid, Mr Nuttall, that you are again drifting beyond the purpose of the Bill. Let me be clear that your remarks have to relate to the Bill and its four clauses, which you have already debated rather extensively. We do not need a review of the Richard review. I want you to relate your comments to the Bill and its clauses. I hope that I have made myself clear this time, because I think that I might have failed last time.

Mr Nuttall: The reason the Richard review is enormously relevant is that in such a huge piece of work, nowhere did Doug Richard come up with the solution that is contained in the Bill. He spoke to hundreds of employers and Government organisations—I will not go through them all—but he did not come up with the solution in the Bill, and neither did any of people who responded to the Government’s consultation exercise over the summer. I hope that we hear more from the Minister about that, because he will have all the facts and figures at his fingertips. The Government’s work on the matter is therefore relevant.

As my hon. Friend the Member for Shipley briefly mentioned, this week the Prime Minister himself announced the new trailblazer programme during his visit to the Mini plant in Oxford. That programme will move apprenticeships on to a new level and deal with the problem that the hon. Member for Denton and Reddish says he is concerned about, which is the quality of apprenticeships. The Government’s approach is to have employers, rather than the Government themselves, lead the development of apprenticeships, and that is what the trailblazer system will ensure. As the Prime Minister said:

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“If you want an apprenticeship, we’re going to make sure you do the best apprenticeship in the world.”

That sums up the trailblazer approach.

Philip Davies: Does my hon. Friend agree that, whereas we all want to strive for what the Prime Minister set out, the Bill would be in danger of bringing apprenticeships back to being tokenistic? They would exist only to fulfil a contract requirement, not to help the wider apprenticeships agenda.

Mr Nuttall: That is the fear about making requirements mandatory, or even creating an impression that would make them quasi-mandatory, which could happen if we passed the Bill.

It has been suggested that the Bill’s definition of “relevant contract” as those being of more than £1 million means that it will not affect small and medium-sized enterprises. Actually, a £1 million contract may cover a period of not a month or six months but three or five years. A micro-company, which is defined as one with fewer than 10 employees, could easily bid for such a contract, so it is simply not the case that the £1 million threshold means that the Bill will cover only the largest companies.

We want to encourage more small and medium-sized companies to apply for contracts, and the Government’s website is an excellent resource. If there is one thing that we can get out of this morning’s debate, it is to encourage small and medium-sized enterprises that are thinking about bidding for Government work to look at that website, which is really user-friendly. A few days ago, the Government finished consulting on how to make it even more user-friendly, and I hope we will hear about that from the Minister. The website is excellent, and users can filter contracts by type and financial value. As a matter of interest, because of the £1 million threshold specified in the Bill, I typed in “construction” and filtered the results to contracts of more than £1 million, and 304 contracts were listed.

I am not sure what the point of clause 2 is. It looks unnecessary to me.

On clause 5, I am not sure why a 12-month delay before the Bill comes into force is specified. The hon. Member for Denton and Reddish did not say why, if it is so important, it should not come into force straight away. Perhaps he will explain in his closing remarks why he has not provided for it to come into force in the usual way, perhaps one month after Royal Assent.

I accept that there is a plethora of statistics on the number of apprenticeships but, by any measure, the Government have an excellent story to tell on the number that have been created in the past three years. The Bill will not do anything to increase the number of apprenticeships. On the other hand, it might create a tick-box atmosphere and culture among those who are interested in, or who apply for, Government contracts. For all those reasons, I oppose the Bill.

12.55 pm

Luciana Berger (Liverpool, Wavertree) (Lab/Co-op): I am delighted to take part in proceedings on this important Bill, which I support. I reiterate my congratulations to

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my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) on introducing this excellent Bill, which I believe is crucial.

I am disappointed by what the hon. Member for Bury North (Mr Nuttall) said over the course of 55 minutes. I cannot understand how he believes his constituents are best served by him speaking for just under an hour in Parliament in London on a Friday against a Bill that would help them, particularly the young people, into employment. I cannot wait to go and campaign for the Labour candidate in Bury North, who I know will stand up for young people who are desperate to get into employment. In the north-west of England, where we have seen an increase in unemployment, it is incumbent on all hon. Members to do everything we can, going down every single avenue, to promote employment and skills.

Andrew Gwynne: I will join my hon. Friend on the streets of Bury North to campaign for the Labour candidate. Does she agree that the people of Bury North will find it very hard to understand why the hon. Member for Bury North (Mr Nuttall) does not want job opportunities to be promoted in the local jobcentre in his constituency?

Luciana Berger: I listened closely to the remarks of the hon. Member for Bury North. I know how many of my constituents rely on the jobcentre for finding out about opportunities. They might not be able to afford to pay for our local paper. We do not have a free sheet—our previous free sheet is now inserted in the paid-for paper. For those reasons, the hon. Gentleman’s objection is incomprehensible.

Andrew Gwynne: Did not our hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) make the pertinent point that, in many of our constituencies, the free papers are no longer delivered to many of the communities to which we want to reach out with those adverts?

Luciana Berger: I thank my hon. Friend for making that point. We need to do everything we can to promote and let people know about opportunities. Our local newspapers are under a lot of pressure, including the Liverpool Echo. We used to have the Merseymart free sheet, but it is no longer available. It used to be delivered, but now it is not. People have to buy the Liverpool Echo to get the Merseymart free sheet, which is inserted in it. For all those reasons, it is important that we increasingly look to our jobcentres. The Government are asking people to use the internet more, and the jobcentre website, on which people can access opportunities virtually, is an important resource.

Philip Davies: Will the hon. Lady explain the difference between desirable and compulsory? There is a clear difference. It might be desirable if we eat salad every day, but I am sure she would not want to make it compulsory. It might be desirable for people to put adverts in the jobcentre, but that does not mean it should be compulsory. Does she not trust businesses in

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her constituency to know where to advertise jobs to get the best people for them? Does she not trust businesses in her constituency?

Luciana Berger: I listened carefully to the hon. Gentleman, but we are conflating various points. Businesses are free to advertise their jobs wherever they wish, but the jobcentre is a crucial resource. Jobcentre Plus requires jobseekers to apply for a number of jobs within a time period. For many people, that is the first resource they use. It is a free resource for business, and I am surprised that the hon. Member for Bury North does not want his businesses to advertise on it.

The Bill seeks to

“Require certain public procurement contracts let by public authorities to include a commitment by the contractor to provide apprenticeships and skills training; and for connected purposes.”

I support the Bill because I have met many people with experience of tendering for public procurement contracts, during which process they must specify and comply with many things. Different local authorities and public bodies, such as the NHS or education authorities, use different frameworks, but they are all very comprehensive, and because tendering companies must comply with and cover so many different things, if the contracts say nothing about apprenticeships, they often do not get included.

The Bill would not mandate apprenticeships, but would be an important tool with which to ensure an increased focus on this area. We need to do everything we can to help people into employment, particularly young people. If people do not get into employment when they leave school, college or university, it becomes increasingly difficult for them to do so over the rest of their working lives. I have met many companies that are concerned about this, but which do not understand the rules—we have discussed Europe already. The Bill would make it a lot clearer and much easier for businesses and public authorities to focus on apprenticeships.

Andrew Gwynne: My hon. Friend has hit the nail on the head. Above all, the Bill would give clarity to those contractors about what public bodies can and cannot ask of them.

Luciana Berger: I thank my hon. Friend for making that helpful clarification at a time when others have sought to confuse that point.

I do not want to take up too much of the House’s time, but I wish to support what Liverpool city council has done on apprenticeships. It has made every effort to work with partners to create apprenticeships in our city. I repeat that unemployment is rising in the north- west. Under enormous pressure from the massive cuts imposed by central Government, the Labour council in Liverpool is trying to be positive and forward-looking and to create employment opportunities. It has created 926 apprenticeships—no mean feat—by working with its service partners, including Glendale, a ground maintenance company, and BT, with which it has provided ICT apprenticeship opportunities.

The council has created hundreds of apprenticeships through the council’s investment plan for schools. The Government’s decision to scrap the Building Schools for the Future programme had a massive impact in Liverpool, where 26 schools were in the pipeline for

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refurbishment or rebuild. It was an absolute disgrace that the scheme was scrapped, but the council has done everything it can to go ahead with as many schools as it can afford. Knowing that investment in those schools and education buildings is vital, we have put in place our own investment plan for schools, in spite of the Government, not with their help, and now the construction firms building 12 new schools in Liverpool have committed to creating apprenticeship positions as part of their contracts. The council has done that of its own accord.

Philip Davies: The hon. Lady says that Liverpool council has done that already. As far as we are aware, it has not been breaking the law, so it seems that she is arguing against herself; she is saying that the Bill is not necessary, because local authorities can do it anyway.

Luciana Berger: If the hon. Gentleman had listened to the earlier contributions from Opposition Members, he would have heard that we were sharing best practice. Many bodies, whether local authorities or other public bodies—education trusts and the NHS spring to mind—are not aware of the opportunities and do not have that focus or direction, and therefore they do not do it. That has an impact on companies and organisations, including those in the voluntary sector, which do not include the requirement in their proposals, and everyone loses out as a result. As I have said, I have given examples of good practice, but they are not sufficient on their own. We need even more apprenticeships. It is not enough merely to celebrate what Liverpool city council has done; we need to see it being done across the board.

Andrew Gwynne: Is that not why it is so important to make it absolutely clear in statute that public bodies may require extra higher and advanced-level apprentices as part of a contract?

Luciana Berger: I entirely agree with my hon. Friend, who has made his point very eloquently.

Philip Davies: Will the hon. Lady give way?

Luciana Berger: I will give way one last time to the hon. Gentleman.

Philip Davies: Is the hon. Lady really saying that in order to encourage people to do something that is already legal and desirable, we need to pass an Act of Parliament? That is like saying “Statins are good for you, but some people have not realised that, so let us pass an Act of Parliament in order to tell people that statins are good for you.” Does the hon. Lady not understand the absurdity of her position?

Luciana Berger: I have listened carefully to what the hon. Gentleman has said, but, as many Labour Members have pointed out, the point is that not everyone is doing something that is particularly important for our nation at this juncture. I cannot stress that enough. It breaks my heart every time I meet an unemployed young person—indeed, anyone who is unemployed—or a person who needs to re-skill because opportunities no longer exist in the area where that person used to work. We need to do everything we can, proactively, to ensure that examples of good practice such as Liverpool city council—

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and I celebrate everything that that council is doing—are not just one-offs, but can be seen across the board. That is not happening now, and that is why we need the Bill.

I mentioned Liverpool’s investment plan for schools. It has also launched a pre-apprenticeship programme, because it acknowledges that it is hard for a young person who is not in employment, education or training even to get on to the first rung of the ladder. In partnership with City of Liverpool college, it is offering a 24-week programme to 16 and 17-year-olds who wish to gain valuable skills and enhance their employability so that they can join the full apprenticeship programme. Another programme in Liverpool is intended to help young people to develop the skills that will enable them to secure apprenticeships in music engineering. That is a fantastic scheme. We also have an “apprenticeship hub bus”, which will provide a one-stop-shop of advice and live apprenticeship job vacancies for those who are leaving education.

All that work has resulted in a reduction in the number of NEETs from 1,803 to 1,308. However, there are still 1,308 16 to 19-year-olds in Liverpool who are not in education, employment or training. We need to do all we can to remedy that, which is why I support the Bill.

I have an apprentice in my constituency office. His name is James Crombleholme, and he joined me just over a year ago. He is beginning the second year of a business administration apprenticeship, again through a programme involving Liverpool city council. If I could employ more apprentices, I would gladly do so, but ours is a small organisation, and we are doing our very best. James is gaining vital skills in the office, and is a valuable member of our team. He is a delight to have around, and he exemplifies the need for as many apprenticeships as possible. Many small organisations such as MPs’ offices should employ apprentices, and they need to be informed of that opportunity.

If public money is being spent, we should do everything to ensure that it is spent in the best possible way. That means investing in our young people and in the future of the country, particularly at a time when 2.5 million people are unemployed. That is far too many, and far too many young people are unemployed as well. The Bill’s specific focus on apprenticeships is very important, and I hope that it will be given a Second Reading.

1.9 pm

Lyn Brown (West Ham) (Lab): First, I congratulate my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) on introducing such a Bill. I have never been so lucky as to be successful in the ballot, but perhaps if I am here for another year or so I might finally get the success that has eluded me.

My hon. Friend has also been lucky in the Minister who is on the Front Bench today—the Minister of State, Cabinet Office, the hon. Member for Ruislip, Northwood and Pinner (Mr Hurd)—as he is a decent and good man. He and I sat here for many Friday mornings putting the Sustainable Communities Bill through the House. I hesitate to suggest, because I realise that I might be damning his career badly by this, that he truly does understand this kind of soft regeneration issue. If one took the Sustainable Communities Bill down to its last detail, one could have argued that it was not necessary

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because we could have done all the things in it without having to pass legislation. However, it was an empowering Bill and it meant a lot to the third sector. So my argument is that not only is this Bill a good one in its own right, but it follows the trajectory taken by the Minister in his own private Member’s Bill that was passed under the previous Government. I therefore have a lot of faith that his response will be hopeful and positive, and will allow this Bill to progress to the next stages, to allow my hon. Friend the Member for Shipley (Philip Davies)—I hope I may call him that—to table his amendments. I know that my hon. Friend the Member for Denton and Reddish would welcome him on the Committee.

I wish to draw on the experience of the London Legacy Development Corporation, which is undertaking excellent work in my constituency and neighbouring constituencies to transform the legacy of the Olympic games into an enduring benefit for local people. I hope that that legacy will endure for generations to come. Since October 2012, the LLDC has been delivering a large programme of construction works at the Queen Elizabeth Olympic park to clear the games-time overlay, including temporary venues, walkways and roads. It is connecting the park with the new roads, cycle paths and pedestrian paths that criss-cross over the site, connecting it to the surrounding area. It is also completing permanent venues, bridges and parklands for their legacy use.

The scheme is a £229 million transformation programme and it has presented the LLDC with its first opportunity to deliver against its strategic aim of being a catalyst for regeneration and convergence in east London and its public commitment in terms of the employment and skills benefit during post-games construction.

Andrew Gwynne: My hon. Friend is making a compelling case about how public procurement can lever in those skills and training opportunities for young people in quite a deprived part of the country, but is it not the case that too few public bodies in her constituency in east London are making use of those opportunities? Would my Bill not help to lever in those extra training opportunities as an enabling power for those public bodies?

Lyn Brown: My hon. Friend is absolutely right. The reason I so want to talk about the LLDC is that it has an innovative way of delivery, which might help him in his arguments with our friend on the Government Benches about the issue of small companies not being able to deliver on this scale. We are talking about a new vehicle to achieve my hon. Friend’s aims.

May I say to my hon. Friend that I think he has missed an opportunity, but I am hoping he will correct that as we go on this afternoon, which is to draw attention to the wonderful Minister and encourage him, through our warm words and congratulations, and the heartfelt faith that we have in his abilities, to support the Bill today?

Andrew Gwynne: I do not wish to pile even more praise on the Minister, but I have every confidence that he shares our ambition to raise the skills and job opportunities of people in places such as Newham and

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Denton and Reddish and I am confident that when he comes to the Dispatch Box he will have lots of nice things to say about the Bill. We are not too far apart and what differences we have can be ironed out in Committee.

Lyn Brown: Indeed they can, and the Minister knows just how exciting such a Committee can be, having been through that process himself.

The LLDC’s focus has been on the creation of job and apprenticeship opportunities in legacy for local people, especially for young people and underrepresented groups who face significant barriers to entering or returning to the labour market. The principal vehicle for delivering those benefits has been embedding them as a requirement in procurement.

Through its social and economic policy, the legacy corporation has developed an approach that uses its procurement processes to assess a bidder’s track records and proposals for securing local social and economic benefits. I remind hon. Members that the LLDC is not some socialist organisation capturing the regeneration opportunities in east London. It is, in fact, a vehicle of the Mayor of London, who would not wish, I think, to be called “one of these outrageous socialist types”. He might possibly rail against such an accusation. It is his programme that has determined that the LLDC will use its procurement in this way.

One of the arguments made by the hon. Member for Shipley, who, sadly, is no longer in his place—I know that he has not left the Chamber because I am speaking—was that it would take too long to go through an assessment process for each of the preferred contractors to prefer the contractors who delivered on the apprenticeships. The gentleman who runs London obviously disagrees, because his processes are clearly about assessing a bidder’s track record and proposals for securing economic benefits and determining a contract based on those assessments. He also wishes to embed those commitments contractually and works in partnership with the contractors, operators, tenants and development partners to deliver them.

Andrew Gwynne: I do not wish to take the name of the hon. Member for Shipley (Philip Davies) in vain as he is not in his place—although he has left his presence in the Chamber in the shape of a lone copy of the Daily Mail. So let me ask my hon. Friend: is she aware whether the Mayor of London has had any problems with the European Commission as regards public procurement?

Lyn Brown: I am not. I would assume that we would have heard if there had been any particular difficulties with said establishment and the procurement processes for London.

As the Bill is not, as my hon. Friend said, about forcing people to do things, the important point is that the Mayor and his offices are working with contractors to develop and deliver his aims. It is not about forcing, but about enabling and empowering.

The Mayor also wants to focus on early intervention with contractors, so that they understand their requirements and co-ordinate delivery. That makes perfect sense to me.

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Andrew Gwynne: Is it not a good thing that my Bill would give the Mayor of London the ability to say to those contractors, “As Mayor of London, I expect a certain proportion of the apprenticeships that you are providing to be of a higher or an advanced level”?

Lyn Brown: It is indeed, but the dialogue with the contractors is clearly what is essential in this process, and my hon. Friend’s Bill provides the Mayor of London and others with a vehicle to say to them, “See? It is here in black and white. It is law. I am entitled to do this. This is something I am enabled to do by Parliament, but I would like to work with you as a contractor, to get the best from you and from the programme.”

The Mayor also delivers and develops interventions with the borough partners, so all the London boroughs are enabled to be in partnership with the programme. He works with Jobcentre Plus—let us face it, that can only be a good thing—and he works with the Greater London authority to embed best practice and partnership working to support contractors in fulfilling their obligations. How can that be a bad thing? The Bill provides the Mayor of London and his organisations with the opportunity to show contractors that they are not acting illegally by undertaking this process.

Andrew Gwynne: Does my hon. Friend think it is a good or a bad thing that her constituents in West Ham will have access to job adverts in their local jobcentre, rather than having to guess where such opportunities are advertised?

Lyn Brown: I absolutely do think it is important that we are working with jobcentres. In Newham we have an excellent programme called Workplace, in which local employers work with the local council and Jobcentre Plus to advertise local positions locally before they are advertised regionally or nationally. That can only be a good thing in an area with the deprivation indices that we have. It is one way of embedding into the area an economic and social legacy for the people that I represent.

The other good thing about what the LLDC is doing is that it adds value and avoids duplication with the existing employment and skills provision of the London boroughs. We are not talking about something that becomes unwieldy, or that is not welcomed by the other host boroughs. When we are recreating infrastructure and targeting delivery according to the needs of the park, we ensure that it is done in the most cost-effective way.

The LLDC is tailoring its approach to the specific needs of the contracts in the programme. We are not asking employers to take on apprenticeships and to have apprenticeships that are not consistent with what they are contracted to undertake. That is another good thing. The Bill would not require the LLDC to change its modus operandi at all; it gives a platform on which the LLDC can base its apprenticeship programme. Obviously, it promotes best practice in recruitment and promotes the London living wage or the construction working board agreements—whichever is higher. I am sure that every Member in the Chamber would applaud that.

There is a strong client commitment to delivering jobs and apprenticeships, which means ensuring that these elements are sufficiently weighted in the pre-qualification questionnaire and invitation-to-tender

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evaluations. The Bill sends an important message to bidders about the importance of this agenda to the LLDC. The need for apprenticeships is there. It is in the pre-qualification questionnaire. If you want to—I am sorry, Madam Deputy Speaker; I know that you will not want to qualify as a contractor at the LLDC, although you could should you wish to, of course.

Any company that wishes to qualify to take a contract with the LLDC has to submit a completed questionnaire. One of the questions in it is, “Are you prepared to offer apprenticeships?” If the company is not prepared to do so, it might get a bit cross. It might think to itself, “Why should I have to?” The Bill will point to the fact that the LLDC is entitled to place that requirement in its pre-tender questionnaire.

The LLDC makes sure that contractors are aware of everything in its procurement pipeline, and uses the principle of relevancy to identify appropriate evaluation questions and weighting. Externally, the LLDC ensures that bidders are clear about the regeneration aims and objectives of the LLDC—convergence and so on. I know that we all understand what that means.

Crucially, the LLDC provides contractors with enough information to know what kind of commitment they are making. It specifies the commitment that companies will have to make in order to get the contract. It is clear that companies will be monitored, evaluated and held to account for what they deliver or fail to deliver. The Bill will make sure that those companies understand that the LLDC is not asking anything of them that it is not entitled to do.

The LLDC asks bidders to set targets for apprenticeships for under-represented groups such as black and minority ethnic communities, disabled people, previously unemployed people, people who have been unemployed for a very long time, and women. I hope you do not mind, Madam Deputy Speaker, if I digress for a moment and say that one of the things that I liked about the apprenticeship programme for the building of the Olympic sites was how it encouraged women into construction industries.

One of the things I learned from sitting in a digger truck and trying to excavate the earth at the Olympic park was that employers liked women using their equipment, because we are gentler on it and the equipment lasts longer if women are employed to use it. I know this from my own experience of driving a car and using the clutch, but my husband disagrees somewhat.

Barbara Keeley: Earlier I mentioned City West in Salford, which takes on apprentices. Those apprentices usually appear at city festivals, where I saw the best example I have ever seen of somebody plastering. That left me, and probably left that woman too, with the view that plastering is not something I will ever be good at. She persuaded me to try it. She was an excellent woman plastering apprentice, but this MP is not going that way.

Lyn Brown: I am not very good at icing cakes either.

Diana Johnson: I went to the Hull training awards last Friday in my constituency. The overall winner, the apprentice of the year, was a woman engineer, which I was delighted to see because we are missing out on a huge pool of talent among young women, who do not think engineering is for them. They make some of the very best engineers in this country.

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Lyn Brown: Indeed they do.

The LLDC also seeks a firm commitment to this approach in the procurement by its contractors, so not only is the LLDC looking at its own people, but at the secondary chain. The expectation of apprenticeships goes further than just the one tier. We know that a big contract is let to a contractor, who lets to subcontractors. The LLDC has ensured that procurement for apprenticeships goes further down the line than the initial contract. In future, should anybody ever query its right to do so, the LLDC will be able to point to the Bill introduced by my hon. Friend the Member for Denton and Reddish to show that it is quite entitled to ask for that commitment.

The LLDC will also evaluate its contractors on the proposals for working with boroughs to make sure that they are getting the most from those apprenticeships. I, like most hon. Members present, have an active third sector in the provision of training opportunities for young people. Community Links in my constituency is continually involved in finding young people who have become particularly disaffected at school or thereafter, helping to put them back on track. It will be able to refer to the LLDC a young person whom they think is right for an apprenticeship. That kind of partnership has real ramifications for our communities. If we ramp them up properly and use procurement in this way, and if we demonstrate by law that we, the LLDC and public bodies are entitled to use procurement in this very socially acceptable and socially manipulative way, we can see—

Andrew Gwynne: My hon. Friend is making a superb contribution today. I commend to her the work of Stockport Engineering Training Association Ltd in my constituency, a training company that has been established by industries in the north-west, mainly engineering, railway and nuclear industries, to provide training and apprenticeship opportunities for young people. It is concerned that the number of schemes coming through its centre has fallen in recent years. Should we not address that through public procurement?

Lyn Brown: I agree with my hon. Friend. Giving local authorities and procurement authorities the confidence that they can use procurement in this way to create apprenticeships and use it for the benefit and betterment of our communities can only be a good thing. I am sure that the Minister will not close his ears to our entreaties to allow the Bill to continue into Committee.

Surely it is in everybody’s interests that contractors deliver jobs and apprenticeships and make the commitment to them, as the LLDC has, as a key partner in east London, bringing significant locally based employment and skills infrastructure to support recruitment needs. It encourages an open and regular conversation with contractors and their supply chains, beginning immediately upon the contract being signed. As we know, it begins before that, because that is what good relationships are about, but, make no mistake, when the contract is signed, it is expected that the companies will deliver and honour the commitments that they have made to the apprenticeships in those local areas.

We need to ensure that the changing trends in the construction industry, such as the higher levels of subcontracting and shorter construction programmes,

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have made it difficult for some firms to offer traditional apprenticeships. In response to that issue, and to ensure delivery on the public commitments, the legacy corporation has commissioned REDS10. I want hon. Members to remember that name. I do not want any Government Members to have palpitations; this is not a socialist programme. REDS does not refer to the colour of its politics—

Andrew Gwynne: Shame.

Lyn Brown: It is indeed. It is merely a descriptive word that the LLDC has chosen to deliver the transformation job and apprenticeship brokerage project.

Andrew Gwynne: The more my hon. Friend goes on, the more I warm towards the Mayor of London.

Lyn Brown: I am afraid that my hon. Friend is encouraging me to sit down, but I will continue.

REDS10 is a National Apprenticeship Service-approved apprenticeship training agency—isn’t that a mouthful? It is contracted to work with prime and subcontractors to broker apprenticeships and job opportunities for local people in the Olympic park transformation programme. REDS10 takes on the apprentices, pays their wages, provides their training and then places them with the subcontractors, allowing them to complete their training across different projects and under the guidance of multiple firms. Therefore, we do not need to disadvantage firms in a supply chain that are unable to provide a full-scale apprenticeship. Instead, they can contract their part of an apprenticeship scheme from REDS10 and make a contribution, which is agreed in the contract with LLDC. Smaller firms are then enabled to participate in the supply chain. Is that not a great idea? Yes.

Nic Dakin (Scunthorpe) (Lab): It is a great idea, and it is being replicated across the country. Humberside Engineering Training Association, which I visited this time last week with my hon. Friend the Member for Streatham (Mr Umunna) to meet apprentices, is doing exactly the same thing in Scunthorpe, in Tata and elsewhere.

Lyn Brown: By not excluding small firms from supply chains, we can set up vehicles that enable them to compete in the same way as larger firms. The apprenticeships requirement that the Bill would enable authorities to deliver will not preclude smaller firms from participating.

The ATA model has allowed the creation and delivery of apprenticeship opportunities that would not otherwise have been created. To date, it has seen a peak of 60 apprenticeships on site, the highest number on a single site in London in 2013. I am sure that we all congratulate them. The project has now moved into its follow-on phase, with the LLDC and REDS10 working closely with prime and subcontractors that have recently commenced work on site to secure opportunities for existing apprentices who are completing initial placements with contractors. By September 2013, 15 apprentices had been successfully moved to new placements and five had been moved into permanent employment. That is something we all want to see.

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To deliver on its public commitments and support contractors, the LLDC set up a transformation job and apprenticeship brokerage project. The project is overseen by a construction operations group, chaired by the LLDC and with representation from key employment and skills service providers in east London. Since October 2012 the project has supported contractors, who in many cases exceeded their contractual commitments, because they see the benefit of training people not only in the skills they want them to have, but in the company ethos.

Once employers get engaged in such an organisation and become more au fait with having apprentices and the support of bigger organisations to enable the admin and those bits of the apprenticeship programme that they cannot deliver, they see that there is a genuine benefit for themselves. In order to reach that stage, however, employers need to be convinced that this place has legislated to enable the overall authority to provide such a programme. That is why the Bill is so relevant.

Mr David Hamilton: Midlothian council is the second smallest land-locked authority in the UK. It is currently building 1,500 council houses. One of the great things we found was that the contractors want a level playing field, because good companies that take on apprentices do not want to be disadvantaged by others not doing so. That would be supported by the Bill.

Lyn Brown: I absolutely agree, and I am grateful to my hon. Friend.

The London Legacy Development Corporation is aware of the transient nature of the work force in sectors such as construction and has asked its contractors to monitor the length of their workers’ residency. When we were building in preparation for the Olympic games, we were keen to make sure that local people, who were being severely disadvantaged by the construction process, were able to take advantage of the opportunities that came their way.

We set up lots of monitoring schemes to find out whether the people getting the jobs and apprenticeships came from the area. Unsurprisingly, people moved into the area to take up the jobs and apprenticeships and then moved out, taking with them their skills and spending power. That, obviously, is not great; we wanted to transform the local area and make sure that local people had the advantages.

Bob Stewart: Has the hon. Lady any idea of how many people who were apprentices for the Olympic build successfully moved into permanent employment as a consequence of that training? Do we have that figure?

Lyn Brown: I am not sure whether the figure is available, but I will check that out and pass a note to the hon. Gentleman as it would interest me too. However, we did discover that apprentices based in Salford, Gateshead and Newcastle came with their firms to the Olympic park to complete their apprenticeships. Although we got additional apprenticeships, the Olympics provided opportunities for companies based elsewhere in the UK to bring their work forces down and keep them employed while we waited for the worst of the recession in building to move on or for additional work to be found.

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Barbara Keeley: I want to return to my hon. Friend’s earlier point about young women. There is a question about young people moving on to permanent jobs. I do not know whether my hon. Friend is aware of it, but a report out today states that three times more young women are employed in low-paid, low-skilled jobs. The proportion of the group about whom we are worried, the 16-to-24 year-olds, in jobs such as cleaning offices and hotels—of which there are plenty in the area of London my hon. Friend is talking about—has increased from 7% to 21%. Sadly, only 1% of the young women are working in skilled trades, compared with 20% of the young men.

Is there anything in the regeneration around the Olympic park that gives hope that those young women will not carry on in those unskilled trades of cleaning offices and hotels, but get opportunities through apprenticeships to do something more skilled?

Lyn Brown: I am happy to tell my hon. Friend that the LLDC has reported that its targets for BME communities, women and people who have been unemployed for a long period have all been met. It did say that employment for disabled people had been slightly under target, mainly due to non-declaration at the point of induction; people are not recorded as disabled in an apprenticeship because they do not self-identify at the point of application. The LLDC has done a sterling job.

Andrew Gwynne: My hon. Friend is making a compelling point. Apprenticeships are not a silver bullet in respect of employment; there is no guarantee of a job at the end of them. However, the real benefit is that upskilling the work force, giving them experience, skills and more advanced qualifications, opens so many more doors for them.

Lyn Brown: That is absolutely true, as many of us will know from people we meet in our surgeries and at our tea and coffee mornings. We also know it from the history of our own families. That has become of great relevance to me since I began to research my family tree following the speech I made in this place about the match-women’s strike. I was absolutely convinced that my mother must have had personal knowledge of the strike through oral history given the amount of detail she gave about it. I am still trying to get there, but I am absolutely sure that I am going to find that one of my family had at least a connection with those amazing and heroic women. So yes, I do agree that, as we know from our own experience in our own families, apprenticeships can be the essential first step on the rung of a ladder to a successful career.

In July 2013, the LLDC carried out an on-site survey that asked over half the work force—780 people out of 1,555—what their length of residency in the borough was, and 85% said that they lived in the London borough of Newham and had been for over a year. Even if they had come to the host borough only to participate in the games, to find a job through the games or because they had got a job or an apprenticeship at the games, they were still there a year later. I realise that a year is not a massive commitment to a community. I have traced my family back to the 1880s, and they have been resident in my constituency since then; I have to say that

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that is not bad. I am not expecting that of the trained apprentices who came through the LLDC, but their being there for a year indicates some kind of commitment to living in the area in which they were trained and given an opportunity.

Using this model of procurement to support and sustain good-quality apprenticeships strikes me as an absolutely excellent and commendable example for other public bodies to follow. This Bill is very much needed in order for the bodies involved to be able to be confident in their interaction with their supply chain. I am so grateful to my hon. Friend for bringing it to us today.

I urge the Government—the really decent Minister on the Front Bench and other hon. Members—to support the Bill and ensure that we can provide more opportunities, more training and more apprenticeships, and get more companies involved in the regeneration of our communities. That is what we are being asked to do today, and I ask the Government please to listen. I know the Minister may have been given a brief that tells him that he should not support a Bill such as this. We went through this with his Sustainable Communities Bill. If he had followed such advice, his Bill would not have got through. I urge him to be brave: support the Bill, support apprentices, and let us do the decent thing.

1.48 pm

Diana Johnson (Kingston upon Hull North) (Lab): The speech by my hon. Friend the Member for West Ham (Lyn Brown) was a tour de force. She talks with great passion about an issue that is very much in her heart—the future opportunities of young people who live in and around her constituency. Many other hon. Members will be very concerned about the shockingly high rates of youth unemployment in this country.

I congratulate my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) on introducing this Bill. To be honest, it is a no-brainer: why would anyone not want to support it? It is short but very focused and clear in what it wants to do. My hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) clearly set out the advantages that local authorities and housing associations can gain in making a commitment to apprenticeships and how positive that is a for a local area. My hon. Friend the Member for Liverpool, Wavertree (Luciana Berger) spoke about the situation in Liverpool, which is very similar to the one I find in Hull. Hull has twice the national average of young people not in education, employment or training, and every Hull MP has been grappling with this issue for some time: how can we ensure that our young people get the opportunities they so richly deserve? If we can squeeze money out of the public purse without adding any additional costs and in a way that benefits our youngsters, that is the way to go.

Andrew Gwynne: I am grateful to my hon. Friend for contributing to this debate. Her points about Hull are pertinent. She will be aware that our parliamentary neighbour, my right hon. Friend the Member for Kingston upon Hull West and Hessle (Alan Johnson), is a sponsor of the Bill. When I approached him, he made precisely

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the same points: if we cannot procure, through public procurement, extra job opportunities for local people in Hull, when can we?

Diana Johnson: Absolutely. My hon. Friend puts the point so well. My right hon. Friend the Member for Kingston upon Hull West and Hessle (Alan Johnson) has always been a strong champion of ensuring that young people have the opportunities that they should have. Any Member who has read his book about his early life, which tells of his disadvantaged background and lack of opportunities, will understand why he wants to stand up and fight for young people.

I want to talk about the Bill from a business perspective. When I was growing up, my dad was an electrician and he had a small business. He trained as an electrician during the second world war and when he left the forces, he set up a small business with his sister, my Auntie Betty. My dad took the view throughout all his life in business that it was incumbent on him to train the next generation of electricians. I remember growing up in my household and hearing my dad say that he wanted to give a chance to young lads leaving school. He used to say that it was outrageous that some of the other, bigger businesses in the area—his was a very small business—did not train apprentices, and yet when a young person finished their apprenticeship, those businesses would go straight in to try to poach them to work for them without going through all the hard work that my dad did to train them.

I knew from a very early age how important it was to give young people those opportunities, and how good people in business—small businesses and others as well—who had a local commitment to their area and communities understood that they were there not only to provide services, but to make sure that young folk had an opportunity to train and get the skills they needed.

Lyn Brown: Given the example that my hon. Friend has just given, would it not be the right thing to do to ensure that supply chains from public procurement reward people like her dad who do the right thing? Those firms would get the subcontract from big procurement contracts and I think that would be the right way to go.

Diana Johnson: Absolutely. My hon. Friend puts the point very well.

My dad’s business carried on for many years because he was a good business man who did the right thing, and my brother, who was an apprentice electrician and did his training, now runs the business. He is doing exactly what my dad said he should do—training apprentices and the electricians of the future—but whenever I see him, he tells me about issues with public procurement. For example, if a school needs to be rewired and the local authority is putting the contracts out to tender, some local authorities take into account whether local firms have apprentices, and that is a good thing, but they do not all do that. It is really frustrating for local businesses that are doing the right thing to feel that they are not being rewarded in the way that they should be because other companies that are cutting corners and are out to make a fast buck do not invest in local people and local communities.

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Nic Dakin: My hon. Friend is making a good point. Does she agree that there is greater value for money if funds from the public purse benefit local businesses and young people in the way that she is describing?

Diana Johnson: Absolutely. My hon. Friend has been a champion of ensuring that youngsters have those opportunities and that businesses provide the apprenticeships that they should provide.

Barbara Keeley: It was pointed out to me last week that the Care Bill, which I hope will return to this place in a few weeks, makes commitments on health education. Health education costs £4.9 billion. Caring for older people in our communities is a vital job, which now takes place mainly in the private sector, but there is no reward of the sort that we are discussing for the few employers who bother to train people. This is a new area that is opening up as we integrate health and social care. We cannot spend a huge amount—£4.9 billion—on the health side of the equation and not train people, for example through apprenticeships, to take up a valued career in social care.

Diana Johnson: Absolutely. My hon. Friend has a great deal of experience of social care and carers. Earlier in the debate, I raised with my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) the issue of how the NHS is spending its money and whether it takes into account whether businesses offer apprenticeships. Given all the reorganisations and changes in the NHS, we need to ask whether clinical commissioning groups are doing everything they should be doing to ensure that their contractors are providing training and apprenticeships. My hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) makes the important point that we need to focus on training people in the care sector. There have been scandals in many parts of the country because people have not had the skills that are needed to care for the elderly.

I want to mention again the Hull training awards, which I attended last Friday. A number of businesses in the city have supported apprenticeships for many years. I have been going to the awards for about five years. The number of businesses is growing year on year, but many employers still do not offer apprenticeships and do not feel that it is something that they want to do.

According to surveys, more than 80% of those who employ apprentices agree that they make the workplace more productive and 81% of consumers would favour a company that takes on apprentices. More than 200 types of apprenticeship are available, offering more than 1,200 job roles. Among employers who employ apprentices, 92% believe that apprenticeships lead to a more motivated and satisfied workforce, and 83% rely on their apprenticeship programme to provide the skilled workers they need for the future of the company. One in five employers is hiring more apprentices to help them through the tough economic climate.

I started by saying that offering apprenticeships was a no-brainer. Why would a business not choose to do it? The facts and figures suggest that every employer should at least consider hiring an apprentice. Money from the public purse should be spent on companies that provide more than just the service or the widget by investing in communities and young people.

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Andrew Gwynne: My hon. Friend is making the case for smarter public procurement. It is not just the cost of the contract that must be considered, but the wider impact on the community. Does that not demonstrate why the Bill is right to insist that local job opportunities should be promoted in the local area?

Diana Johnson: That is absolutely right.

Research shows that, on average, an apprentice earns more than £100,000 more throughout their lifetime than other employees. We need to get such facts out there. Given the decimation of the careers service, we need to get the message across to youngsters about what an apprenticeship can mean and how it can enhance people’s opportunities. Of course we want young people to go to university if that is what is most appropriate for them, but apprenticeships are also valuable qualifications.

Andrew Gwynne: My hon. Friend is making another pertinent point. No doubt in her constituency, as in mine, the vast majority of young people will not have the opportunity to go to university or a higher education institution. The best way in which those people can get a higher education level qualification, as well as on-the-job training, is by doing a higher or advanced apprenticeship.

Diana Johnson: My hon. Friend is absolutely right.

Before I finish, I pay tribute to Mark Walker, whom I took on as an apprentice in my office several years ago and who has proved all the points that I have just made. He has added value to the office, made it more productive and made it a more motivated and satisfying place to work. I have experience of apprentices in my constituency office, and I also have the experience of my dad, which says it all for me—if he thought apprentices were worth investing in, it is absolutely the right thing to do.

I am really pleased to be here today to support my hon. Friend’s Bill, and I hope that the Front Benchers will give it a fair wind so that we can move on to Committee.

2 pm

Mr Iain Wright (Hartlepool) (Lab): I thank my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) for his passionate and compelling argument. I fully support the Bill and believe that we should give it a fair wind and take it to Committee. I hope that the Minister agrees.

It is vital that the British economy succeeds, thrives and grows. That success should be based not on making a fast buck, cutting corners, thinking of the short term or cutting employment rights and training opportunities in a race to the bottom, but on well-paid, secure and skilled jobs. That is how Britain can pay its way in the world in the 21st century—with an emphasis on a high-skilled, well trained work force. To help achieve that objective, we need a skills system that meets the needs of our country, our society, the economy, employers and young people. My hon. Friend’s Bill would provide that and be central to having a good, resilient, productive and efficient work force for the future.

My hon. Friend rightly said that in many ways, the previous Government helped to revalue apprenticeships. There were something like 65,000 apprenticeships when the Government came into office in 1997, and when we

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left office in 2010—I was the Minister responsible for apprenticeships at that time—there were 240,000. The current Government have carried on that good work to some extent, and I want one characteristic of apprenticeships to be that they transcend party politics and Parliaments and work in the long-term interests of what this country needs. It is clear that we need good, strong apprenticeships.

As my hon. Friend said, even in these financially straitened times, it makes common sense, economic sense and social sense, when both central and local government spend money—often billions of pounds—for skills and training opportunities to be provided when contracts are granted. He mentioned the 50:50 scheme in his constituency, which particularly interested me, and other hon. Members have mentioned similar schemes. My hon. Friend the Member for Liverpool, Wavertree (Luciana Berger) said that 926 apprenticeships had been put in place through Liverpool city council, and we heard about other initiatives. In an excellent speech, my hon. Friend the Member for West Ham (Lyn Brown) talked about what is going on in London. Of course, in programmes such as Crossrail, Building Schools for the Future and so on, Labour established the idea of procurement as a lever to bring in additional training opportunities.

There remains a huge issue to consider. Although the number of apprenticeships has gone up, I am particularly concerned about the statistics on under-19-year-olds. In 2011-12, there were 129,900 apprenticeship starts by those aged under 19, but that represented a 1.4% decrease year on year. There were 95,400 intermediate-level apprenticeship starts, which was a 2% decrease. We fail our young people if we do not get them a good first step on the career ladder, and we all know about the crisis of youth unemployment that this country still has. In the quarter June to August 2013, 958,000 young people aged 16 to 24 were unemployed, making an unemployment rate of 20%—up by 0.1% on the previous quarter and 0.5% on the same period last year. The unemployment rate for 18 to 24-year-olds is 19.1%, but what really concerns me—it is linked with the decline in apprenticeship starts for under-19s—is that the unemployment rate for 16 to 17-year-olds is 36.3%. That should be a national scandal.

We are failing our young people and not giving them the employment and training opportunities they need. We will suffer the consequences of that for decades to come. If we do not get our 16 to 19-year-olds on to a career ladder and thinking about skills and training, and if they cannot get employment, the chances are that they will suffer low-paid, low-skilled jobs for the rest of their careers.

Not only will the careers of those people and the prospects for their families suffer for decades, but the long-term economic potential of the country and how we compete in the modern, fiercely competitive world, will be compromised. We need to address that. I suggest that ensuring we can link training opportunities and apprenticeship places with public procurement is an exceptional way to go.

Barbara Keeley: I want to tie in my hon. Friend’s point with the wage benefits of completing an advanced apprenticeship, which I have mentioned. Does he agree

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that, in areas such as Salford, where we have such a lot of long-term unemployment and unemployed young people, wage benefits are the important factor? If we can get people in to apprenticeships, particularly advanced apprenticeships, we can ensure that they can earn 22% more than similar young people.

Mr Wright: I am glad my hon. Friend has contributed to the debate. I know how much she is passionately committed to giving young people a chance, particularly with apprenticeships. I have fond memories of going to Salford as Minister with responsibility for apprenticeships. We had launched the apprenticeships grant for employers. I met a tree surgeons firm in her constituency—I do not know whether she remembers. It could not afford to take on a young person, but we provided a £2,500 grant. I thought it was to help to pay the wages of that young apprentice, but it provided the equipment to allow them to scale up the tree and do the work required. That small firm wanted to help to bring on young people and to ensure that it gave young people a chance, making a difference—as I recall, it took on a 17-year-old. The Bill can do exactly the same.

My hon. Friend the Member for Denton and Reddish was right to highlight the importance of driving up quality. However, he also mentioned the need to expand opportunity. Often, we do not tell young people of the difference apprenticeships can make. People will be paid more over the lifetime of their career if they become apprentices. I am therefore baffled by the debate on clause 2, which is on the advertisement of work force vacancies. When there are opportunities, we should communicate them as much as possible. That is a no-brainer. Where better to do so than in the jobcentre? Clause 2 is essential. I want the Bill to pass on Second Reading, but, in Committee, we need to widen and expand it to ensure that schools, colleges, teachers and others are aware of apprenticeship opportunities.

Andrew Gwynne: My hon. Friend is right that we could go further. I struggle to see what the problem is if Stockport, Tameside, Newham, Hull or Salford councils promote public procurement and apprentices through public procurement in their areas. Why should they not advertise those opportunities to young people in those areas?

Mr Wright: My hon. Friend is right. We have an enormous opportunity in my patch in the north-east. In Hartlepool, we have the makings of a great renewable energy and offshore wind supply chain. I know that the area my hon. Friend the Member for Kingston upon Hull North (Diana Johnson) represents is in the same position.

We have had public procurement tenders, including for the Teesside offshore wind farm, in which no local firm got the work, meaning no local apprenticeship opportunities. What a scandalous waste of potential. I fail to understand why we should not use the opportunities from the public purse to give young people those chances and why those opportunities should not be advertised locally so that people in Hartlepool, Hull, Stockport and elsewhere can know about them. My hon. Friend the Member for West Ham made an eloquent and passionate contribution about the impact of the Olympics,

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a major project that should have benefited east London. It did benefit east London, but not as much as it could have. Those benefits should have been maximised.

I was very interested in the hon. Member for Shipley (Philip Davies). I always knew he wanted to take us back to the ’50s, but I did not realise he meant the 1550s and the Elizabethan age. He made an important point. He said that the Bill would undermine best value for the taxpayer because the additional apprenticeship opportunities would make procurement contracts more expensive. I disagree. One of our problems—with the Government, with the country—is this short-term, silo-driven approach. If we spend or save £1 in one area, no consideration is given to the impact elsewhere on the public purse. For example, no one considers the long-term consequences of cuts to local government for access to A and E or social care. We need to take a longer-term view. If, using the public procurement route, we can help to train our work force of the future, we will create many more opportunities and our economic potential will be greatly increased.

Andrew Gwynne: In terms of total spend, does not public procurement often make one of the largest contributions, if not the largest contribution, to the local economy, and is it not baffling, therefore, that Statler and Waldorf on the Tory Benches seem to think it falls outside the remit of the public domain to expect more training and skills opportunities?

Mr Wright: I found it astonishing too. I was particularly concerned by the 55-minute speech of the hon. Member for Bury North (Mr Nuttall). I am sure that those 555 18 to 24-year-olds in his constituency will be surprised to hear that he did not want apprenticeship opportunities advertised in his local jobcentre.

Mr Nuttall: With the greatest of respect, I never said that I did not want job opportunities advertised in the Bury jobcentre—incidentally, my office is just around the corner from it. I just think it should be left to employers to decide where they advertise their jobs.

Mr Wright: But does the hon. Gentleman not agree that, in order for the opportunities to be cast as wide as possible, young people should be made aware of them. There could be teachers, schools and colleges who are not aware of what is on offer. As I just said, I am keen to see these opportunities advertised in jobcentres, but I am also keen to table amendments in Committee to ensure that schools, colleges and others in the community are made aware of them.

Lyn Brown: I find it remarkable that some Government Members do not seem to understand that the taxpayer’s pound should be made to go further. Normally, we hear quite a different argument from them. Why can they not see that taxpayers’ money should be enabling young people to get the skills they need to find work?

Mr Wright: Absolutely. In these straitened financial times, why are we not squeezing the taxpayer’s pound still further, for the long term, to ensure that young people have a good career decades into the future? I cannot understand it either. I share my hon. Friend’s disbelief.

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Philip Davies: I wonder why Labour Front Benchers have so little faith in employers that they feel that they cannot be trusted to advertise in a jobcentre, and must be mandated to do so by the Labour party. The hon. Gentleman talks of value for money, and says that we should look at the bigger picture rather than seeing things simply in terms of pounds, shillings and pence. Can he explain what was the great benefit to the country of his Government’s leaving it with an annual deficit of £150 billion?

Mr Wright: Oh dear me. I think that the Bill describes exactly what we need to do in order to secure the country’s economic success. When those in government—centrally or locally—spend money, they should look to the long term, and ensure that they can provide the skills and training opportunities that are needed for the future by giving young people a chance. I believe that that is central to what we need to be doing.

I fully support what my hon. Friend the Member for Denton and Reddish is trying to do, and I hope that the Minister does as well.

2.15 pm

The Minister of State, Cabinet Office (Mr Nick Hurd): This has been a very good debate. The speeches have been passionate, honest, often rooted in personal experience and, for the most part, gratifyingly free of tribal politics in relation to an issue that really should cross the party divide.

We have heard about some fantastic models of intelligent procurement, such as REDS10. We have heard about people in Liverpool, Humberside and other parts of the country who are demonstrating how procurement can be used to squeeze out the maximum value for the taxpayer, with the full encouragement of the Government. We also experienced the seismic revelation that the hon. Member for West Ham (Lyn Brown) enjoys a bit of my hon. Friend the Member for Shipley (Philip Davies) on a Friday morning. I think that my friend and colleague earned the admiration of the House for his composure at that moment. He had to take some time out from the debate, but he retained his composure sufficiently to make an excellent speech, as did my hon. Friend the Member for Bury North (Mr Nuttall). I think that the shade of Eric Forth would have been proud to hear both speeches. They conveyed warmth and cross-party support on the need for more apprentices when they posed the fundamental question of why this law is actually needed, which is the job that we, as legislators, must do.

First and foremost, I must genuinely congratulate the hon. Member for Denton and Reddish (Andrew Gwynne) on his speech. It seems a very long time ago, but it was absolutely brilliant—not least because he secured harmony in the Gwynne household this weekend with his rhapsody about Denton community college, of which his wife is a trustee.

The hon. Gentleman spoke with real passion and conviction of his concern about the level of youth unemployment, which, at 7.6%, is clearly unacceptably high. As he knows, and has heard from Government Members, everyone recognises that the Bill is extremely well-intentioned. My hon. Friend the Member for Harlow (Robert Halfon) spoke to me personally about his support

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for it. We have taken it very seriously, and the context could not be more important. It is shocking that we as a country are wasting the potential of a million young people. The hon. Member for Hartlepool (Mr Wright) was right to speak about that with passion and anger.

The country faces a huge challenge. I am not making a party-political point when I say that the fact that youth unemployment rose by 40% under the last Administration during good times is a source of real concern, and raises serious doubts about the skills and work-readiness of our young people. That has been reflected in survey after survey of employers. The fundamental question is this: how can we ensure that our young people benefit from the gradual recovery in the jobs market? That is a national challenge, and should be seen as such. It is a challenge not just for my party, the Labour party or any other party in the House, but for the private sector, the education system and civil society. So many people care about it that it is a challenge for funders such as the Big Lottery Fund and its Talent Match. So much good will needs to be harnessed to move the needle. That is why the whole debate about academic standards, access to informal learning opportunities for young people—I speak as the Minister for youth—the quality of career guidance and the success of new traineeships, which I greatly welcome, is so important. But the fundamental point of this debate—our level of ambition on the status and priority attached to apprenticeships—is important. It is fundamental, because there has been a missed opportunity; the status of apprenticeships has been too low over time, particularly as they are a win-win—the hon. Member for Worsley and Eccles South (Barbara Keeley) spoke well about that. The evidence is clear that apprenticeships are good for employers, as well as for employees. The evidence shows that those on advanced apprenticeships earn, on average, between £77,000 and £117,000 more over their lifetime, and 72% of employers reported that apprenticeships improved the productivity of their organisation.

Andrew Gwynne: I am fully with the Minister in his argument, so far. Does he agree that if we are seeking to drive up the standards of apprentices, as well as to extend the capacity of apprenticeships, it is not wrong to give an empowering facility, as my Bill does, to public bodies to say to contractors, “We expect there to be a proportion of higher and advanced apprenticeships as part of this contract because it is good for our local economy”?

Mr Hurd: I have some reservations, which I am going to express, despite the shameless flattery that has been heaped on me, not least by the hon. Member for West Ham. I wish to give the hon. Member for Denton and Reddish some reassurance, not least because of the reservations we have about the need for this particular law, that the ambition he seeks on apprenticeships already exists. As my hon. Friend the Member for Bury North mentioned, this very week the Prime Minister was in Oxford talking about our ambition to be the best in the world. The hon. Gentleman will know that given the fiscal constraints we are under, what we choose to spend our money on does reflect our priorities. The fact of the matter is that we have spent £5.7 billion on apprenticeships

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since 2010; we have grown them by 1.5 million; and in 2012-13 the current provisional estimate is for about 500,000 apprenticeships. That is building on work that has gone before, but let us be clear: that is double what was available in 2008-09. As my hon. Friend the Member for Shipley said, it is not just about numbers and growth; robust quality is also important.

Andrew Gwynne: The Minister is right to say that this is about how we spend the money. That is true of not only central Government, but other public bodies, so does it not empower local government, which does not provide many services directly itself but buys in services from contractors, if it is able to say, “This is what we expect because these are our budgets that we are handing over to you as contractors, and this is what we want in return”?

Mr Hurd: The point is that local authorities already have that power. This proposed law does not change anything in terms of regulation or the permission that the system gives to contractors at the moment.

I wish to finish making my point about quality. It is important, and we have put statutory standards in place to ensure that apprenticeships are real jobs and lead to recognised qualifications. I hope that that enjoys the support of the House. We want this to be employer-led. We want to encourage employers because it is absolutely in their interests, and that is how we sustain the momentum behind this as Governments come and go. That is why we have introduced incentive payments of £1,500 for smaller employers, because the attitude of small and medium-sized enterprises is important, to take on up to 10 new apprentices aged 16 to 24. As we have announced this week in the implementation plan, there will be trailblazer projects in the aerospace, automotive, digital industries, energy and utilities, electrotechnical, financial services, food and drink, manufacturing and life sciences and industrial sciences sectors. I hope I have convinced the hon. Gentleman that the ambition that he wants to see is there, not only to build on what was done before, but to take it to a different level.

Andrew Gwynne: I have no doubt that the ambition is there, but the Minister will have heard earlier about SETA in the Stockport part of my constituency, an organisation that was established by industry to get apprenticeships and training in a range of high-skill areas. It has raised concerns with me that the apprenticeships are not coming through in the rail industry, the nuclear power industry and so on. There is a role for public procurement in this.

Mr Hurd: I certainly agree that there is a lot more to do in supplying apprenticeships and pushing, nudging, encouraging and incentivising various sectors of the economy to be more ambitious and think more intelligently about how they can structure such opportunities.

I want to show the Bill the respect it deserves, and I do so as someone who has been in the same position as the hon. Gentleman and promoted a private Member’s Bill. I want to make it quite clear to him that the ambition he seeks is there. The question we need to ask ourselves is whether we need this law. As I was sitting here during the debate, I could almost see Eric sitting over there, getting ready to speak and to ask that

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question in a forensic way. We need to get beyond the good intentions; we are legislators. We need to ask ourselves with each snowflake that we add to the mountain of regulation whether we can justify it, whether it will make a difference and whether it will serve its purpose, however well-intentioned the promoter.

Andrew Gwynne: Of course, there has to be a problem if we are to address it through good intentions. I contend that there is a problem. Too few apprenticeships are coming through the public procurement route, which is why this Bill is absolutely necessary.

Mr Hurd: There is a problem, and we are wasting the potential of 1 million young people in this country. Apprenticeships are part of the response to that, as I have said, and the Government are very proud that we have effectively doubled the number of apprenticeships each year compared with 2008-09. We are in no way complacent, because as Labour Members have said, there is still a great deal more that can be done.

As for whether the law is needed, the point was powerfully made by Government Back Benchers that the existing law and procurement policy give the permission that the hon. Gentleman seeks. I would go further than that. A private Member’s Bill that I, as a Minister, picked up and championed, the Public Services (Social Value) Act 2012, extended that permission. The Act, which came into force in January with cross-party support, places a requirement on commissioners to consider the economic, environmental and social benefits of their approaches to procurement before the process starts. They must also consider whether they should consult on these issues. I put it to the hon. Gentleman that that process, with which contracting authorities around the country, particularly Liverpool and Birmingham, are very engaged, could include consideration of the benefits of any potential apprenticeships to be created under the contract. That is another tool in the box for those who are seeking to develop intelligent models of procurement and trying to squeeze as much value as possible out of every public pound that they are spending. That is exactly what we are trying to encourage.

Lyn Brown: I am so disappointed. I genuinely thought that the Minister would be able to listen and work his way through this. How much public money does he think is being wasted by not being used to procure apprenticeships in this country?

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Mr Hurd: I am obviously disappointed to disappoint the hon. Lady. That has rather spoilt my day. There is a fundamental point about value for money, which is that the processes and regulations we have set up absolutely allow what the hon. Member for Denton and Reddish wants and, as I said, the social value Act goes further in seeking that permission. We have set up a commissioning academy to support and create the space for people who are spending taxpayers’ money so that they can think more intelligently about how that can be spent. I give him my pledge that I will use what evidence I have to ensure that in my conversations about the use of that Act, and in the commissioning academy, we ask how apprenticeships can be boosted by those processes so that we can share and spread the best practice that exists and has been articulated extremely well by Opposition Members. As the hon. Gentleman generously said, the DWP has shown intelligent, forward-thinking practice by managing to get approximately 2,000 apprenticeships into its supply chain through its procurement practice.

Andrew Gwynne: I am grateful to the Minister for giving way in the last remaining seconds. But does he not understand that, laudable though his legislation may be, it does not explicitly give local authorities the power to ask for higher level and advanced level apprenticeships, or to have them advertised in the local economy? That is crucial if we are going to change the life chances of the young—

2.30 pm

The debate stood adjourned (Standing Order No.11(2)).

Ordered,That the debate be resumed on Friday 8 November.

Business without Debate

Communications (Unsolicited Telephone Calls and Texts) Bill

Motion made, That the Bill be now read a Second time.

Hon. Members: Object.

Bill to be read a Second time on Friday 29 November.

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First-time Employers

Motion made, and Question proposed, That this House do now adjourn.—(Greg Hands.)

2.30 pm

David Rutley (Macclesfield) (Con): I am grateful to Mr Speaker for granting this debate and I am glad to see the Minister for Universities and Science, my right hon. Friend the Member for Havant (Mr Willetts), in his place. My right hon. Friend is a good friend to Macclesfield, and continues to provide support and advice on the long-term future of an AstraZeneca site at Alderley Park, which is much appreciated. I realise that this might not be the most popular slot in the parliamentary timetable, but, despite that, several Members have shown their support for this very important subject, including my hon. Friends the Members for Bury North (Mr Nuttall), for Bedford (Richard Fuller), for Worcester (Mr Walker) and for Vale of Glamorgan (Alun Cairns).

We often discuss in this House ways to increase employment, or support small businesses, or support large businesses for that matter. What we do less often is talk about the very smallest businesses—the one-person companies, the sole traders, the freelancers. We also tend to debate more often those issues that affect existing businesses, rather than those that are yet to exist. Today, I want to focus on how we can get more people to see running their own business as a viable career option—in particular, how we can encourage them to believe that employing their first member of staff will be easier than they think and also rewarding.

I am not particularly talking about business people with a family history of self-employment or entrepreneurialism, nor am I talking about those who have friends to call on for free advice. The debate today is to give voice to people who have set up a business against all the odds, from scratch. Is there more we can do to help them grow their business? Vitally, are we confident that the target audience for any help is actually aware of the assistance that is available? A little-appreciated fact is that the vast majority of UK businesses currently employ no one at all.

For some, that makes sense. Not everyone needs an employee for their business model to work, but for others there are barriers in the way to taking on a first employee who could help a business to grow. I would like to look at what those barriers are now, acknowledge the progress that is being made in tackling them and then suggest possible areas for further action—most notably in improving how we get the message across that support is out there for everyone, not just for those with family and friends with business experience. I am keen for children in schools in Macclesfield—and across the country—to believe that one day they can run a business and employ people if they want to, and that a Government will be there to help them, advise them and support them—not stifle their ambition and get in their way.

Let us start with the facts. The latest figures from the Office for National Statistics confirm that we are experiencing record self-employment: 4.2 million people work for themselves—some 14% of all those in employment. At the moment, self-employment is more common for men and for older people, but the dynamics are changing. The number of women in self-employment is rising fast.

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In Macclesfield, the percentage of women in self-employment is the highest in the north-west, and the number of young people across the country who want to set up their own business is high. One survey suggests that up to 70% have at least the ambition to set up their own enterprise, while the Prince’s Trust has found that up to 30% of young people actively expect to be self-employed.

This is good news. We need more first-time entrepreneurs, but we should be enabling those entrepreneurs, wherever possible, to take a step into what is often the unknown and become first-time employers too. Despite enthusiasm for being in business—we are currently enjoying a record number of businesses in the UK—relatively few take on an employee. The longer a sole trader is in business, the less likely they are to want to take someone on. The British Chambers of Commerce found that sole traders who have been operating for less than six months have far greater ambitions to take on staff than those who have been operating for more than two years. Why are these early hopes dashed? Why are their initial aspirations being dampened?

There was a time when it was unusual for people to have their own home or to own shares, until right to buy and public utility share offers made those steps into the unknown massively easier to take. The aim of those initiatives was not merely to shift ownership from public sector to private sector, but to shift ownership to a wider part of the population than had previously enjoyed it. Many of the people who bought their council house or took part in the utility share subscriptions had no family history of holding such property. They did not have friends who could tell them how to go about it. The success of the sales, though, showed that the ambition was there, but something had held people back, be it the tangible issue of cash or the intangible psychological and perhaps cultural issues that can act as a barrier to realising aspirations.

Some 75% of businesses currently employ no one beyond their owner. That is not to say that none of them hires freelance or agency services, such as an accountant or marketing campaigners, but 75% do not have a payroll of their own. It is not a step that their owners have taken, but if they did, it would lead to yet lower unemployment. In the light of this, David Frost of the British Chambers of Commerce has said that the key questions are: how many of these companies are interested in employing people, how do we identify them, and how we can encourage them to take the huge leap needed to become an employer?

“The first action,”

says Mr Frost, and I agree with him,

“must be to reduce the size of the leap required.”

There is indeed a leap, as I discovered recently when, with the help of the Federation of Small Businesses, I conducted a straw poll on social media asking what prevents entrepreneurs from taking on that vital first member of staff. Respondents suggested a number of barriers that can loosely be grouped, as I suggested a moment ago, as psychological or tangible. I had respondents who specifically used the word “fear”—“Fear of getting some minor issue wrong and being taken to the cleaners by the employee, fear I will get sued, fear I have to pay maternity leave when I can hardly afford to stay afloat, fear of all the legislation that is pro-employee and

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against employers” and so on. There is also frequent use of negative terms: “overwhelmed”, “crippling”, “uncertain”, “totally confusing”.

The sources of fear, among many, were being sued for breaches of employment law and, for some, the prospect of dealing with Her Majesty’s Revenue and Customs. It turns out that the British Chambers of Commerce found similar real and perceived barriers in a far more detailed survey of sole traders in 2011. It seems that more needs to be done to show potential employers what HMRC and other public bodies can do to help new businesses, or signpost other sources of help, such as Citizens Advice, not least the East Cheshire citizens advice bureau, which tweeted to me on this very subject. There are also excellent courses available from local chambers, such as the Macclesfield chamber of commerce, which I have been fortunate enough to attend. Support is available from websites such as smarta.com .

As Lord Green has pointed out about UK Trade & Investment, and Lord Young has highlighted about Government business services in general, the problem is not that the support is not there but that the target businesses often do not know about it or do not feel it worthwhile trying to find it. I have been told that there are over 100 public sector websites providing bits and pieces that will help in setting up a business. Surely a more focused message would be a better approach and improve the prospects of success.

Respondents, both to me and to the BCC survey, raised the cost of regulations, red tape and restrictions. There is a feeling that time is money, and that the opportunity cost of the time required for performing an employer’s duties could actually cause a business to shrink, not grow. Respondents mentioned a raft of issues that concern them, and the BCC has called for exemptions for the smallest businesses from such requirements. I recognise that complete exemption is probably asking too much but, as with workplace pensions, perhaps there is scope to allow the smallest businesses significant lead times in complying with regulations through phased implementation. Some commentators have also pointed to the possibility of extending the current three-year micro-business moratorium on new regulation and making it a three-year rolling moratorium with potential opt-ins. This would be important for new businesses and particularly for potential new employers going forward.

The employment allowance of £2,000 will clearly be a big boost, slashing or eliminating the national insurance liability of a business taking on a first employee. Similarly helpful is the Government's deregulatory commitment to "one in, two out". We need to be clear: regulations designed to protect people in employment should not be so onerous that they cause potential employers to shut off the option of providing employment. Deregulation at the EU level is the next step forward, and I welcome the Prime Minister's commitment to that through his business taskforce.

There is more work to do, but it is worth reminding ourselves that real enthusiasm exists about the prospect of being able to hire an employee if—I emphasise “if”—barriers are removed. The will is there, if not always the ability—perceived or real. So, what else could be done? One option is exploring "de-risking" measures more fully. The Institute for Public Policy Research and the FSB are examining several ideas to

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de-risk the hiring process for small firms, including the idea of appointing intermediary bodies to support employment. Instead of the small business bearing the whole risk, these bodies would directly employ the individual and place them with a host business, effectively leaving small businesses to provide work and pay wages. As the Minister will know, this model is already being used by apprenticeship training academies, and it could be extended to other categories of employee, such as the long-term unemployed, for defined time periods.

Apprenticeships have been one of the great successes of this Government. In fact, in many situations, apprentices are an ideal first employee. One of the respondents to my survey suggested that apprentice sharing between small businesses could also be explored.

I understand that growth vouchers, which were announced in the Budget and are being taken forward by the Minister’s Department, could be used to help small businesses expand their work force. I would be grateful if the Minister provided any insights on how the vouchers could be used as a vehicle for encouraging employment growth among the businesses we are discussing today.

Several respondents suggested that small businesses can, and of course do, utilise freelancers instead of employees. This may well be a solution for a number of businesses, but the fact that a business says it has taken on a freelancer understandably does not always mean that Her Majesty’s Revenue and Customs will agree. If HMRC believes a business has actually taken on an employee, it will clearly want to take action. Some businesses feel that there could be greater certainty in current employment relationships and that this lack of clarity dampens their own aspirations to grow.

The Adam Smith Institute has suggested that radical legislation is needed to enshrine the right to declare oneself freelance or self-employed. The clear risk in this situation is that employees may feel pressured into declaring themselves self-employed by employers. Commentators have suggested that one avenue that could be explored is allowing a certain limited number of employees to self-certify as self-employed. They argue that this could lead to greater clarity for both businesses and workers, and improve flexibility in the labour market.

The Minister will know that Lord Young has urged the Government to bang more of their own drums. Where there is help available, it should be communicated as effectively as possible to potential employers. The signposts for those who are thinking of taking on staff need clearly to say "straight ahead", rather than "diversion ahead" or "no entry". An engaging communications campaign could help. It should signpost the help and how-to guides on offer. It could be as simple as a leaflet in the next HMRC mailing; it could be a higher-profile campaign, such as "I'm in" for workplace pensions. It is good to see that HMRC has been moving in this direction recently. There is a new video on YouTube detailing what needs to be done to become a first-time employer. It is a useful video, but it has been watched fewer than 300 times. We now need to help more businesses know that it and other advice is available.

But this not just about public bodies. We should recognise the importance of business-to-business communications too. The work of websites such as that of smarta or the banks that provide small business advice needs to be encouraged. We should more fully engage with business about how best to communicate to

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business and create one-stop shops for would-be employers. There is some very good practice: the FSB, for example, provides a 24-hour helpline to business, with guaranteed advice, from just £120 a year.

Enthusiasm clearly does exist about the prospect of being able to hire an employee in many micro-businesses. The FSB recently found that small-business confidence is at a record high, and there are clear ambitions to take on staff—if barriers are removed. The will to set up is there, the will to employ is there. There are, as I have highlighted, options for further action. We now owe it to the tradition of progressive Conservatives to redouble our efforts to ensure that the will finds a way. The Minister, I know, is a great torchbearer for this tradition, and I look forward to hearing his response.

2.45 pm

The Minister for Universities and Science (Mr David Willetts): I congratulate my hon. Friend the Member for Macclesfield (David Rutley) on bringing this important subject to the House’s attention. May I also say how much I appreciate the opportunity to work with him on the challenges facing AstraZeneca in his constituency? He has worked incredibly hard to secure a strong and vigorous future for the Alderley Park site, and he knows that the Government will work with him on that to ensure that his constituency remains a successful and vibrant centre of enterprise.

That leads me to small businesses, which are indeed vital to our economy. We want more people to start a business and more businesses to grow, and taking on the first employee is a vital step in growing a business. Let me explain some of the ways we are supporting small businesses. We are improving their access to finance, lowering their tax burden and ensuring that business support is simpler, more joined-up and easier to access. Those are the challenges my hon. Friend has just set us, and they are absolutely the right ones for us to tackle.

We can see the progress that has been made already in my hon. Friend’s constituency. From May 2010 to September 2013 there were over 1,200 business start-ups in Macclesfield, and 330 in the 12 months to September 2013. In fact, the start-up rate for the Cheshire East local authority area in the 12 months to September 2013 was higher than that for both the north-west and Great Britain as a whole.

As my hon. Friend said, one of the big challenges facing start-ups is employing staff for the first time. Let me set out what we are doing to help businesses meet that challenge. Often what people worry about in business is the complexity of what they have to do and the fear of getting it wrong. There are all the words we are familiar with: the “burden” of red tape, the “minefield” of regulation and the “barriers” they face as they try to grow and, in particular, take on their first employee. That is why we are committed to making the regulatory experience for business a better one. We are reducing the number of new regulations being introduced through the one-in, two-out rule. We are tackling the existing stock of regulations through the red tape challenge, which has identified over 3,500 regulations for reform, with almost 2,000 to be scrapped or reduced. We have introduced a small and micro-business assessment, which

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builds on the micro-business moratorium, to which my hon. Friend referred, providing exemption from new regulation for businesses with up to 50 staff if there is any evidence that they will result in disproportionate burdens that could impede growth.

I think that business is starting to feel the benefit of those initiatives. The FSB’s “Voice of Small Business” survey has reported a reduction in the burden of regulation felt by its members. Some 20% reported that regulation was a barrier to growth in 2012, but this year the figure had reduced to 17%. Its members also felt that regulatory costs are reducing, with 21% stating that regulatory costs were a burden in 2012, down to 18% this year. Although we are moving in the right direction, the perception of the burden of regulation remains high, and my hon. Friend made some important points about communicating what we are doing.

Let me turn briefly to employment law. We know that bad regulation can harm businesses and that the fear of regulation, even though it is often misplaced, can damage growth. That is why we launched the employment law review at the start of this Parliament. It has taken a systematic approach to testing our employment laws, addressing misconceptions and tackling real barriers to ensure that our labour market is flexible, effective and fair.

Our employment law reforms are starting to make a difference for employers. A 2012 CBI-Harvey Nash employment trends survey stated that there had been a 10 percentage-point improvement in perceptions of employment law since 2011. Our reforms cover the whole lifecycle—from taking on a person, to managing a work force, to letting people go.

We have increased the qualifying period of unfair dismissal from one to two years, as employers told us that they needed more time to make sure that they had made the right hiring decision. We also recognised business concerns about employment tribunals, so we sought to dispel myths about them. We have introduced fees to employment tribunals and streamlined the process, including judges sitting alone in unfair dismissal cases.

We recognise, however, that getting the rules right is not enough on its own; employers need to understand them. Last year, we launched a simple online tool to help first-time employers understand minimum legal requirements when they take someone on. In referring to the online tool, I am aware of my hon. Friend’s remark that there were 100 Government or Government-related sites where such information was available. Through the Government’s excellent gov.uk initiative, we are trying to make the process far simpler, with a big reduction in the number of dispersed sites with separate access and different types of data.

The “Employing staff for the first time” tool sets out the six things employers need to do when employing staff for the first time: how much to pay someone; how to check whether someone has the legal right to work in the UK; how to carry out a criminal records check; insuring oneself as an employer; advising employees on their terms and conditions; and registering with Her Majesty’s Revenue and Customs. Each should be a straightforward and simple process. The tool currently gets about 11,000 visits a month. It is highly rated in terms of user engagement and we will continue to promote it.

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I turn to tax measures to support businesses taking on staff. They are important to reduce cost and make tax simpler. Again, we have put measures in place. We have increased the employer national insurance contributions threshold by £21 a week above indexation. That returns more than £3 billion a year to employers, including the micro-businesses to which my hon. Friend referred. As a result, all employers are now £150 a year better off for each employee earning above the threshold.

From April 2014, every business will be entitled to a £2,000 employment allowance to reduce their employer national insurance contributions bill each year. That will support businesses that aspire to grow by hiring their first employee or by expanding their work force. I am confident that my hon. Friend, like many Government Members—and, I hope, Opposition Members—will be actively promoting that important measure when it comes into force in April next year.

The allowance will be very simple for businesses, which will only need to confirm their eligibility through the usual payroll process. Up to 1.25 million employers—one third of all employers—will benefit, with around 450,000 taken out of paying employer NICs altogether. More than 90% of the benefit of the allowance goes to small businesses with fewer than 50 employees.

We have continued to simplify the tax system overall and made a commitment in the autumn statement 2012 to a target to reduce the annual cost to business of tax administration by £250 million by the end of the spending review period. Since April 2013, all unincorporated businesses have had the option to use cash basis accounting to calculate their tax liability. They will also be able to use the flat rates to calculate some types of expenses if they wish, rather than having to calculate actual amounts. It is estimated that up to 3 million businesses will be able to benefit from this simplification.

HMRC has taken steps to support small and medium-sized enterprises that need help in getting their tax affairs right. SME error and failure to take reasonable care contributes just under £6 billion a year to the tax gap. HMRC is increasing its educational support by tailoring and targeting its initiatives at key business lifecycle points, and SMEs can now manage their contact details and view tax liabilities and payments all in one place.

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I hope that I have been able to convince my hon. Friend that we are working hard to make life easier for people hiring staff for the first time. I assure him that we continue to work with the FSB and other organisations to consider proposals such as the very imaginative ones that he has brought to the House. I am pleased to say that the Government are already doing what he proposes on apprenticeship-sharing, although he would like to go even further. We have introduced apprenticeship training agencies so that small employers who are unable to commit to the full term of an apprenticeship are still able to take part in the apprenticeship programme. ATAs act as the employer and place the apprentices with host small and micro-businesses. This approach of group trading associations and apprenticeship training agencies is something that our party worked on in opposition. I well recall the work with the Minister without Portfolio, my right hon. Friend the Member for South Holland and The Deepings (Mr Hayes), who is now safely ensconced in the Prime Minister’s office. It is good to see these initiatives coming to fruition.

My hon. Friend referred to the growth vouchers programme, which will enable micro and small businesses to take part in a randomised control trial that will test what advice might help these firms to grow. One of the areas on which they can be offered advice is expanding their work force and taking on new employees. We will be watching to see exactly how this works and will bear in mind the further proposals that he has made.

I believe that we are making it easier for people to start and grow a business. We are providing information and advice to help people to take on employees. We will continue to listen to small businesses and to my hon. Friend’s imaginative proposals on help for them. He is absolutely right about the importance of banging the drum for small businesses, and his excellent speech gave us increased enthusiasm for that task. I am very grateful to him.

Question put and agreed to.

2.57 pm

House adjourned.