Apprenticeships and Skills (Public Procurement Contracts) Bill

Debate between Andrew Gwynne and David Nuttall

Friday 1st November 2013 Commons Chamber

[Andrew Gwynne]

My hon. Friend is right. Over the past few months, when I was drafting the Bill, I spoke to numerous companies, large and small, which were bidding for public procurement contracts. They made precisely the point that my hon. Friend has made. If a public body requires apprenticeships to be part of the tendering process, the standards of the bids will be levelled upwards, so that a company that pursues good practice by providing apprenticeships will no longer be undercut by another that does not invest in skills and training.

[Mr David Nuttall (Bury North) (Con)]

The hon. Gentleman said a moment ago that the Bill would send a message to public authorities that did not include a requirement for apprenticeships in their procurement processes. If that is all that he aims to do, would it not be simpler to write to the authorities explaining the position and to issue a press release, rather than trying to introduce legislation?

[Andrew Gwynne]

Were that to succeed, then yes, but the hon. Gentleman knows as well as I do that some Government Departments, public bodies and local authorities would still be saying “We cannot do this.” Introducing legislation giving them the power to ask to be allowed to do it, if it is what they want to do, will make the position clear to all. The Bill is not prescriptive; it does not compel those bodies to act. On the contrary, it empowers them.

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[Mr David Nuttall (Bury North) (Con)]

It is a great pleasure, as always, to follow the hon. Member for Worsley and Eccles South (Barbara Keeley), who made a considered and thoughtful contribution, much of which we could all agree with. As has been said, we are all agreed that apprenticeships are generally a very good thing and that a lot of good work is being done on them. If this debate has done nothing else, I hope it has been able to highlight some of the excellent practices going on around the country. I apologise for the fact that I have to leave at about 2.15 pm, Madam Deputy Speaker. I am not sure when the debate will finish. It may have wrapped up by then, but if it has not I apologise to the Bill’s promoter and to the Front Benchers, if I miss their speeches.

The hon. Member for Denton and Reddish (Andrew Gwynne), my near neighbour in Greater Manchester, made an interesting opening speech. When there are no explanatory notes to a Bill, as is the case with this one—I certainly was not given any by the Vote Office—I always rely on the opening speech to clarify some of the issues. It probably says more about me than it does about the hon. Gentleman, but I was a little more concerned and mystified by some of the Bill’s provisions after I had heard his speech, and the explanations he gave in response to some of the interventions, than when I read it in my office over the past couple of days.

The hon. Gentleman has a touching, perhaps naive belief in the Government’s ability to create jobs and to do so through direction and the inclusion of certain provisions in contract clauses. He mentioned the 50:50 scheme, and I understand, if I heard correctly, that that scheme was run by his local authority, which paid £1,000 for each apprentice. I am not sure whether the number of apprenticeships was limited or unlimited, but of course there is already a Government scheme, the apprenticeship grant for employers—AGE—scheme. I am sure he will be familiar with the scheme, which provides £1,500 to small businesses.

The AGE scheme, which applies specifically to young people aged 16 to 24, was announced in November 2011 and launched in February 2012, and was designed to encourage more small businesses to take on apprentices and to encourage young apprentices to raise their skill levels. It pays £1,500 to every small business that takes on a young apprentice if the firm has never hired an apprentice before and if it has 1,000 or fewer employees when it takes the apprentice on. It is very much geared towards small and medium-sized enterprises, and the employer cannot claim more than 10 grants. Perhaps the hon. Gentleman’s local authority got the idea of giving a cash sweetener to local employers from that scheme.

One point has emerged which goes to the heart of the Bill: is it mandatory, compulsory or merely permissive? That question is at the core of my concerns. We have heard a lot from the hon. Gentleman about his belief that the Bill is purely permissive but, frankly, that is not the purpose of legislation. Local authorities and public bodies already have the freedom to do what the Bill proposes. Indeed, we have heard many examples already of good practice. Where appropriate, public bodies have encouraged—I would not want it to go any further than that—contractors to take on apprentices.

The only possible rationale for having the Bill at all is if someone has the view that there are not enough apprenticeships and that not enough are of a high enough quality. Clause 1(2) is about a possibility—I will not put it any more firmly than that, as that is what the hon. Gentleman has said himself. It says that an authority “may”—note, “may”—

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

That is about raising the general skill level of apprentices.

[Andrew Gwynne]

Does the hon. Gentleman not think that if a local authority—for argument’s sake, let us say Bury metropolitan borough council—is procuring services and wants to ensure that the apprenticeships linked to the contract are of a higher or advanced level, it should be able to specify that in the contract?

[Mr Nuttall]

I am grateful for that intervention because it allows me to make an important point. If the Bill were to say the opposite and prevented any procurement contract from including a provision requiring a contractor to take on higher level or advanced apprentices, or any apprentices at all, I would certainly be very much against it. But of course that is not the Bill before us, and local authorities already have the power to include such a provision, as the hon. Gentleman said.

[Andrew Gwynne]

But does the hon. Gentleman not want to put it in statute, so that it is beyond all reasonable doubt that public bodies can specify that a proportion of apprenticeships tied into a contract should be of a higher and advanced level?

[Mr Nuttall]

I am not aware that there is any doubt at all. The phrase “beyond all reasonable doubt” is commonly used to describe the burden of proof in a criminal case, where the prosecution must prove their case beyond all reasonable doubt. As has been made clear, there may be some instances where local authorities, for whatever reason, are not doing what some other local authorities are doing, but by the hon. Gentleman’s own admission, the Bill will not change that.

[Andrew Gwynne]

Actually, the Bill will change that because it will make it clear to those local authorities that are not doing this that they are legally able to do it. The hon. Gentleman says that there is no doubt at present, but if so he cannot have been listening to his hon. Friend the Member for Shipley (Philip Davies), who seemed to spread a lot of doubt about whether local authorities were able to do just the kind of things that we are talking about.

[Mr Nuttall]

The hon. Gentleman refers to my hon. Friend’s speech. This debate is not about whether I agree with my hon. Friend; it is about the terms of the Bill. The arguments that my hon. Friend made may or may not be the same as the arguments that I will advance—and quite frankly, I do not think it matters whether they agree or not.

[Mr Nuttall]

I entirely agree. I think that intervention goes to the nux of the Bill—[Hon. Members: “Nux?”]—the crux of the Bill. Did I say nux? That is a new word. It is the difference between the nub and the crux. It goes to the core of the Bill—I will change track.

[Andrew Gwynne]

Of course the Bill is empowering in its ability to allow local authorities to require a proportion of apprenticeships to be of a higher or advanced level. The only compulsion that I can see is that a relevant contract must require the contractor to advertise the vacancies in their local jobcentre. Surely the hon. Gentleman is not arguing that that is a bad thing.

[Mr Nuttall]

I do not want to jump ahead too far in my speech, or I shall run the risk of repeating myself later. The hon. Gentleman is right about the provision in clause 2:

“A relevant contract must require the contractor to—

(a) advertise all vacancies”.

I have my concerns about that, which I will come to. Before that, let me deal with the question whether the Bill is mandatory or permissive, which is where I started this preliminary remark.

Although I am constantly told that the Bill is permissive in so far as clause 1 is concerned, I have concerns, as I mentioned briefly in an intervention, that if the guidelines were altered, one interpretation of clause 1(1)(b) would mean that a tenderer—somebody applying for a contract—could be required to do as the clause states. It would be mandatory in those circumstances because the clause says:

“must . . .

(b) ensure that the provisions in the guidelines issued by the OGC . . . are reflected in that contract”.

If that provision were used, it would become mandatory. I say that by way of preliminary comment.

Two or three speakers have mentioned the number of higher level apprenticeships, level 4. The statistics that I have, which I think are the most recent ones, show that the number of level 4 apprenticeships increased from 3,700 in 2011-12 to 9,000 in 2012-13. Although these are still small numbers, they are the very highest level apprenticeships, which are a fairly new creation, so by definition the numbers will be small because it takes a while for people to follow through the lower levels and to be able to move on to the higher level. That step change in those numbers from 3,700 to 9,000 shows the general direction of travel.

I start by congratulating the hon. Member for Denton and Reddish on his success in coming so high up in the ballot for private Members’ Bills that he secured pole position on one of the coveted first seven Fridays, which means that he could be certain of having his Bill debated. It deals, as I said, with a worthy cause and at first sight it seems very attractive, but that is all that can be said for it. It is superficially attractive, but I fear that it will not achieve what he wishes to achieve. I share with him the desire that there should be more higher quality apprenticeships, but as I will go on to say, all the evidence, and there is plenty of it, shows that the route that the Government have taken over the past three years has increased the number of apprentices.

The Bill goes to the heart of the debate about the extent to which the Government—any Government—should micro-manage individual businesses and their relationship with Government.

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[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.