Children’s Wellbeing and Schools Bill

Lord Macpherson of Earl's Court Excerpts

Thursday 18th September 2025 Lords Chamber

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

I think we have yet to have a full discussion on Amendment 483, as well as Amendment 483A, so perhaps we could proceed to that discussion.

[Lord Macpherson of Earl’s Court (CB)]

My Lords, I will speak briefly in support of Amendment 483, which I have put my name to. The noble Lord, Lord Layard, has set out the arguments very eloquently. I would merely like to add the perspective of a former Treasury official.

Economic growth, or the lack of it, lies at the heart of the country’s problems. Without it, we simply will not be able to afford the costs of an ageing population. The Government will be forced to raise taxes even more than they already have and public services will deteriorate further, alienating an already alienated electorate. There is little the Government can do to promote growth in the short term. As an open economy, Britain is likely to grow only as fast as global demand permits, and we all know the effect of increased protectionism, but the Government can do something about the medium and long term.

We all know what drives growth: good infrastructure, competition, innovation, and a sensible tax system—but, above all, skills. Successive Governments have done a good job on education. Attainment in schools has improved and there has been a dramatic expansion in university education over the last 50 years, which, for the most part, has been reflected in the living standards of graduates. However, that still leaves 50% of school leavers who do not go to university who are poorly served by a vocational educational system that compares badly with our competitors’.

Technical and further education has never been prioritised sufficiently, and I can understand why. The media, the Government and the Civil Service are all dominated by graduates. Technical education is not sexy. The lags in the impact of any reform are long and variable. The plain fact is that there are not many votes in it, but sometimes Governments can do the right thing for future generations. I welcome recent announcements by the Government of a youth guarantee and the extra support for skills in the spending review, but they need to go further. An apprenticeship guarantee provides a golden opportunity to make a step change in provision and long-term economic performance.

I recognise that money is hard to come by, but the Treasury is an economics ministry as well as a finance ministry, and it needs some positive announcements to offset the inevitable gloom in the forthcoming Budget. I encourage the Minister and her department to engage actively with the Treasury. It should be possible to, for example, tweak the apprenticeship levy to give it a greater youth focus. If the money cannot be found now, the Government should at least set out a timetable, and if they cannot set out a timetable, they can at least sign up to the objective.

As the noble Lord, Lord Layard, said, a previous Government passed the Apprenticeships, Skills, Children and Learning Act 2009. It can be done, and I call on the Minister to act.

[Lord Deben (Con)]

My Lords, this is a rather crucial amendment. The reason is that we are a nation that is inclined to talk about education as if it is always academic education. If I have criticisms of previous Governments—and I have of those from both sides—they are that we have emphasised education as if it is the only way, rather than part of a grouping of educational opportunities.

We are also rather inclined to not support technical education, and the comparison with our competitors is notable and historically of very long standing. I recently read a report about such education by a committee of the House that remarked that Prussia was much better at it than we were. The Committee will immediately see how long ago that report was produced. Curiously, we have always found this a difficulty in the way that we think about things and in many of the changes that we have made, such as the insistence that polytechnics should become universities, as if that somehow improved the circumstances and that there was something less good about having something that was aimed specifically at talking about the issues that we are discussing. We have to change the atmosphere.

I much approved of the comments just made by the noble Lord, Lord Macpherson, about what the Government could do if they did not have the money. However, there is quite a lot of money in that fund, which seems to have gone back to the Treasury rather than being used in quite the way one would have hoped. However, if they do not have the money, it is very important to make the statement that this is important, and that it is part of the way in which we help those who need it but who, once having had it, will be making a real contribution.

This is why I come back to the point made by the noble Lord, Lord Layard, that the Treasury will get the money back. There is a real truth in this. We need it; we have not had it. I am not blaming any particular Government for this, because, after all, this was a pretty late decision of that Labour Government, even though it was changed afterwards by the coalition Government for reasons that I cannot now remember. However, it is important that we recognise that this is an essential part of a modern educational system. We have not got it, we ought to get it, and the Government need to come to terms with a change in the way we think.

Universal Credit

Lord Macpherson of Earl's Court Excerpts

Wednesday 21st December 2016 Lords Chamber

[Lord Macpherson of Earl’s Court (CB) (Maiden Speech)]

My Lords, I feel very fortunate and indeed honoured to be speaking for the first time in your Lordships’ House. I am grateful for the very warm welcome I have received in recent weeks, my Treasury origins notwithstanding. I would like to thank the extraordinarily helpful staff of the House, who have initiated me into its more arcane mysteries. I would also like to thank my supporters, the noble Lord, Lord Layard, and my noble friend Lord Stern of Brentford. Both are internationally renowned economists. Both have worked on labour market and poverty issues, and I have learned a great deal from them.

I recently left the Treasury after 31 years. One of my first posts there was on social security at the time of the Fowler reforms, whose eponymous author is now Lord Speaker. I worked on his admirable plan to replace family income supplement with family credit. Later, I worked for Ken Clarke on seeking to extend family credit, and I had the great privilege of working for Gordon Brown, leading the work on the new tax credits at the turn of the century, when I also worked with the noble Baroness, Lady Sherlock, among others. I was also Permanent Secretary when Mr Duncan Smith announced his plans for universal credit in 2010.

I see successive reforms to income-related benefits as very much an evolutionary continuum, informed by evidence and experience. And although each change has rightly been subject to vigorous debate, not least on what constitutes a fair and affordable level of benefit, each reform, in its own way, has been successful. Our country has one of the most dynamic and flexible labour markets in the developed world, and we should celebrate that.

Of course, it is too early to tell whether universal credit will achieve its objectives, but I welcome the fact that, as a concept, it has cross-party support, and that digital technology at least in principle is making options possible which were previously unthinkable.

I hope to come back to the issues raised by universal credit in future debates, not least to respond to the challenge of the noble Lord, Lord Kirkwood: how to finance improvements to universal credit. For my part, I would advocate spending a bit more on income-related benefits for working-age people, perhaps at the expense of the very large amounts that are now going to pensioners. However, for the moment, I shall confine myself to one observation.

The delivery of universal credit has been a long and expensive journey, and it is not over yet. When the dust has settled, I hope, like my noble friend Lord Stevens, that we can learn some of the lessons. I fear that the original timetable was overly aggressive; that capacity, at least in the early years, was inadequate; and that, with hindsight, the department and the Treasury could have worked better together.

In the meanwhile, the nation should be hugely grateful to the noble Lord, Lord Freud, who has done a fantastic job. He has devoted six years of his life to the cause, and that is public service indeed.