Skills: Importance for the UK Economy and Quality of Life

Lord Lilley Excerpts

Thursday 9th May 2024 Lords Chamber

[Lord Lilley (Con)]

My Lords, I congratulate the noble Lord, Lord Aberdare, on securing this debate and opening it so brilliantly, and the noble Lord, Lord Marks of Hale, for a gently brilliant but forceful speech. If I am not down in the Chamber and up in my room and I see his name on the annunciator in future, I certainly will turn the sound on and listen to what he has to say.

The skills problem in this country is of long standing. There are Blue Books written in the 19th century which decry the shortage of skills here relative to Germany. As people such as Correlli Barnett and others have pointed out, the roots lie in a sort of class prejudice that attributes prestige to a subject in inverse proportion to its practical and commercial value: the prestige is higher the more academic it is and lower the more practical and commercial it is.

I saw that in my own life. My grandfather, who was a skilled lathe operator during the First World War producing torpedoes, educated himself in mechanical engineering and rose up the firm a bit. Eventually—obviously, he was inspired by the prediction of what my noble friend Lord Baker would recommend—he ended up teaching mechanical engineering in a college of further education. So it always seemed a wonderful thing to me, and when I went to university and acquired a degree in natural sciences, I asked my director of studies if I could move to mechanical engineering. He said, “No—you’re quite clever enough to continue doing pure science”. He was wrong in two respects: I was never going to be another Einstein, and we need clever people, whether at university or in colleges and schools, to acquire the skills to make the things we use. If I go over a bridge, I want to know that the engineer who designed and created that bridge was good, and that the people who welded it were skilled in what they were doing.

Sadly, there are only two ways to increase the supply of skills in this country. One is to increase the skill levels of the domestic population, and the other is to import skills from abroad. My thesis is that unless and until we break the national addiction to importing skills from abroad, we will never seriously tackle the lack of domestic skilled people. Almost the only person who has done anything useful and practical is my noble friend Lord Baker; most of the other initiatives have been ineffectual or half-hearted.

Since Tony Blair opened our borders to the importing of skills from abroad—this is not a party-political point, because he was, sadly, followed by the coalition Government and Boris Johnson—spending on training of people at work has declined, and, predictably, the time people at work spend on training has declined. One of the things that brought home to me how deeply entrenched this belief is in the need to import skills from abroad—and, indeed, the virtue of doing so—was when I was on the Select Committee in the other House and we went up to Sunderland after the referendum. We were greeted by people from the local district council, the county council, the local CBI, the Institute of Directors and the chamber of commerce, and they said their principal fear was that they would no longer be able to import skilled workers from abroad.

The only major employer that was not present was Nissan. I remembered visiting Nissan when I was Trade and Industry Secretary shortly after it set up, and I asked a rather stupid question. They were too polite to point out who was stupid, but I asked them whether they had had any problems recruiting trained automotive workers in Durham when they set up. Of course, there were none within hundreds of miles of there, so it was a stupid question. But they said no, they had trained them, and they were very keen to be trained. Now, the Nissan factory is the most productive factory in the whole Nissan network across the world. So I put it to the local CBI, IoD and chamber of commerce that if Nissan had been able or inclined to follow its belief that the way to get skills was to import them from Europe, there would be 7,000 people in Sunderland flipping hamburgers or unemployed, instead of being the most productive workers in the Nissan network.

We have to break this addiction—but, unfortunately, we have convinced ourselves that, at least for specific skills shortages, we must import the workers from abroad. Yet, since we took that view, in almost all the areas where we initially had a shortage, the shortage has got worse. That should not come as any surprise, because the International Labour Organization, way back in 2004, warned:

“What may begin as a simple temporary ‘spot shortage’ of trained native workers, can be made considerably more permanent by attempting a quick fix from migrant labor. Any program which imports migrants into a sector whose employers are complaining of insufficient trained natives, can be expected to exacerbate (rather than alleviate) its native shortage. Rather than raising incentives to entice new workers to seek training to fill the empty slots, visas are likely to be used to avoid the needed market response”.


But we did not take any notice of that.

My conclusion, therefore, is that if in future we say there is a specific shortage and for a while, we will have to import people from abroad, that must be permitted only if there is an agreement between the employers, educators and the Government that they will train more people in that sector, so that we do not have such a reliance, within a specific period. Employers will have to recognise and acknowledge that during that period—probably indefinitely—they will have to pay more for those people.

I mention pay because it is rather important. The very idea of a shortage of labour in a free market is an oxymoron. Again, this was pointed out by a colleague of the author I have just quoted, who said:

“Long term labor shortages do not happen naturally in market economies. That is not to say that they don’t exist. They are created when employers or government agencies tamper with the natural functioning of the wage mechanism”.


Allowing indefinite reliance on importing labour from abroad has enabled us to put off tackling the shortages, which the noble Lord, Lord Aberdare, has, thankfully, brought to our attention, and which, hopefully, with the advice of my noble friend Lord Baker, we will in future remedy.

Skill Shortages in Business and Industry

Lord Lilley Excerpts

Wednesday 28th February 2024 Lords Chamber

[Baroness Barran (Con)]

As the noble Earl knows, one reason why there are skills shortages in the creative industries is their very rapid growth rate. Between 2010 and 2019, they grew one and a half times faster than the wider economy, and in 2021 they employed 2.3 million people, which is a 49% increase on 2011. We have created flexi-job and accelerated apprenticeships, and improved the transfer system, particularly aiming to support our world-beating creative industries.

[Lord Lilley (Con)]

My Lords, is my noble friend aware that the United Nations International Labour Organization warned that a

“temporary … shortage … of trained native workers, can … be made … permanent by the attempting a quick fix from migrant labor. Any program which imports migrants into a sector whose employers are complaining of insufficient trained natives, can be expected to exacerbate (rather than alleviate) its native shortage”?

Since Tony Blair ignored that warning, we have imported millions of workers—

[Noble Lords]

Oh!

[Lord Lilley (Con)]

We have. As the ILO predicted, shortages have got worse, even though Members opposite want to deny the facts. When will we abandon this failed policy and start training and paying our own people better?

[Baroness Barran (Con)]

As my noble friend well knows, we have introduced a points-based immigration system, making sure that we can focus on the brightest and the best to make a positive contribution to our economy. But my noble friend is quite right that we need to invest in a way that promotes productivity and creates great careers and livelihoods for all our people.

Education: Climate Change Science

Lord Lilley Excerpts

Thursday 16th May 2019 Lords Chamber

[Lord Agnew of Oulton]

My Lords, there is absolutely no suggestion that there is denial of climate change by this Government. Indeed, we have seen some of the most dramatic improvements in dealing with decarbonisation of the economy over the last 10 years. We are leading the way in the G20, we have reduced carbon in the economy by 4.7% per year, which is double the G7 average, and we have some of the highest levels of wind generation in the world—so I can assure the noble Lord that we are not anti or against it. However, we also have to remember that we should be worried not just about climate change but about environmental contamination.

[Lord Lilley (Con)]

My Lords, I draw attention to my interests in the register. Will my noble friend ensure that climate change is taught within the context of the scientific method, which requires predictions based on hypothesis to be tested against observations? Therefore, let children know that the impact of CO₂ is well established by observations and can be measured, and that the direct effect of doubling the amount of CO₂ in the atmosphere will be a one degree centigrade increase in the average temperature of the globe. However, higher estimates, based on much less certain feedbacks for which there is not observational confirmation, and all the forecasts based on climate models, assume very high feedbacks that have been falsified by observations. Therefore, those models need to be amended.

[Lord Agnew of Oulton]

I assure the noble Lord that we are improving the curriculum all the time. For example, in 2018, 96% of pupils in state-funded schools were entered for the science component of the EBacc. The proportion of pupils taking GCSE geography increased from 26% in 2010 to 41% last year. We have also seen increases in participation in A-level chemistry and physics. These are all science and evidence-based subjects.

Secondary Education

Lord Lilley Excerpts

Thursday 21st June 2012 Commons Chamber

[Michael Gove]

Again, the hon. Lady talks good sense on education and is absolutely right. One strength of the Northern Ireland system is its emphasis on greater rigour and stretch in mathematics, and more and more students are achieving those qualifications. We have sought to pay mathematics graduates more to encourage them to consider teaching, and to create new centres of excellence, new 16-to-18 free schools in mathematics, but there is so much more to do, and I look forward to working with her on that.

[Mr Peter Lilley (Hitchin and Harpenden) (Con)]

Does my right hon. Friend agree that the weakness that has characterised the British education system for a century and a half has been a failure to produce enough people with technical and vocational qualifications, partly because of a presumption that they were for the less able and less academic? Can he reassure me that his reforms will tackle that weakness and ensure that technical and vocational qualifications that are of the utmost rigour and held in the highest esteem are available to all?

[Michael Gove]

My right hon. Friend makes a very good point. One weakness in the implementation of the Education Act 1944 was that the third strand, technical schools, did not receive the investment that they should have done, and as a result a weakness in technical education, which this country has had since 1851, was reinforced.

The advent of university technical colleges, an idea pioneered by Kenneth Baker and Andrew Adonis, is going some way to dealing with the problem, and Alison Wolf’s report, which has injected additional rigour into vocational qualifications, also helps to meet that challenge, but we need to do more, including reforming the funding of further education colleges in order to strengthen vocational subjects.