Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [Lords]

Andrew Pakes Excerpts

2nd reading
Tuesday 25th February 2025 Commons Chamber

[Ian Sollom]

I have looked beyond the AELP briefing, thank you very much. This is a critical area of Government policy, and it is important to get it right from the start. That is just a difference of approach.

As my noble Friend Baroness Garden said in the other place, this looks like an innocuous little Bill, but there is so much more to it than meets the eye. It represents a fundamental shift away from employer leadership in our skills system towards ministerial whim, a shift away from statutory independence towards departmental convenience, and a shift away from proper parliamentary accountability towards rule by regulation. The Government may argue that this is just an enabling Bill to pave the way for Skills England, but that is precisely the problem. It enables the wrong thing—it enables centralisation when we need independence, it enables ministerial control when we need employer leadership, and it enables opacity when we need accountability.

[Andrew Pakes (Peterborough) (Lab)]

The hon. Member and I share a county, and he will be aware that in a place such as mine, we have seen the decimation of level 2 and 3 apprenticeships. Does he not recognise that the biggest concern I hear from employers is that the current system is centralised and letting down working-class families in seats like mine? What they want is Skills England. No employer has been to see me to speak against Skills England, but many have been to speak to me against the current system, because it does not give us flexibility. What might be all right for academic policy in Cambridge will not be all right in Peterborough. We need the change delivered now.

[Ian Sollom]

I point out that I represent St Neots, which is not Cambridge, and many employers have spoken to me about their concerns about Skills England and the lack of clarity on its future.

We cannot support this Bill. That is not because we oppose reform—we desperately need it—but because centralising power in the hands of Ministers, removing proper scrutiny and weakening employer involvement in our skills system will make things worse, ultimately. Learners, employers and our economy deserve better than this overcentralisation of power.

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[Sir John Hayes]

Yes, of course I acknowledge that role. It is important to point out that many of the universities do great work. I would not want to disparage that work, and the hon. Lady is right to draw the House’s attention to it.

The point I was really making is that, sadly, many people are driven down a pathway that is just not right for them. That is because of the underestimation of the significance of practical accomplishment, both at an intellectual level—the unwillingness to recognise that practical accomplishment is of a high order—and at a practical level in terms of the advice that people are often given and may later regret. It is not easy for a young person to know quite what path to take, and if the advice they get skews them towards one route or another, it is fairly likely that they will be ill equipped to make a considered judgment. I am simply making the argument for, at the very least, a degree of equality about the advice we give to people.

This Bill is questionable in a number of respects, and in particular, as has been highlighted by my right hon. Friend the Member for East Hampshire (Damian Hinds) and others, in the way that it presents the future management and control of apprenticeships and the standards associated with them. It is right that employers play a key role in that process, but the Bill is silent on the role of employers.

I am not an unbridled admirer of the Institute for Apprenticeships. I did not create it. In my time as Minister, and indeed as shadow Minister, the standards were guaranteed by sector skills councils. I would have gone for a sector-based approach myself. Had I stayed in office, I would probably have developed that further and emulated the German approach by establishing guilds. I began to lay some of the foundations for that as Minister, and I would have gone for such an approach rather than where we ended up. Having said that, what is critical about either that kind of sectoral approach or the apprenticeship institute being abolished by the Bill is the role of employers in ensuring that what is taught and tested meets a real economic need. We cannot detach that economic need from the structure by which we guarantee the quality of apprenticeships.

So, there is the issue of quality, and again the Bill is unconvincing in that respect. My right hon. Friend drew attention to the fact that if quality is lowered, the numbers can be increased. Indeed, the Labour Government prior to 2010 introduced programme-led apprenticeships, which were taught entirely outside of the workplace. They were still called apprenticeships but were unrelated to any particular employer or sector. That is not the way forward, and any diminution of standards will further undermine the status of practical learning. I simply say to the Minister that if the Secretary of State is going to take back control—to borrow a popular phrase—it is vital that simultaneously we hear more during the passage of the legislation about how standards will be maintained, because at the moment we have few assurances to that effect.

I will say a word on numbers, partly to advertise my own effectiveness in government. When I became the Minister of State for Further Education, Skills and Lifelong Learning, I was able, due to the promotion of apprenticeships, to drive their number to the highest level in modern times. I became the Minister in 2010. By 2011/12, we achieved 521,000 apprenticeships. That has never been equalled since, and we are now down to about 340,000. To say a word about previous Labour Governments, I inherited 280,000 apprenticeships, and the average number of apprenticeship completions from 2000 to 2009-10 was less than 100,000 a year.

As we debate these matters going forward, it is vital that the Government commit to the apprenticeship as a key determiner of their skills policy. The number of apprenticeships and their quality will allow the Government to drive up skills levels and, therefore, to meet economic need.

[Andrew Pakes (Peterborough) (Lab)]

Will the right hon. Gentleman give way?

[Sir John Hayes]

I am grateful to the hon. Gentleman, who has been listening attentively to my speech so far.

[Andrew Pakes]

I am worried that I might damn the right hon. Gentleman with faint praise because when he cited the numbers from when he was the Minister, one of the determinants of his success was the involvement of trade unions in the sector skills council and the partnership. While we have talked lots about employers, he was an advocate in his party of involving trade unions. Unfortunately, Ministers after him excluded trade unions from that involvement. Is he advocating that trade unions should be involved in the new system?

[Sir John Hayes]

I am immensely flattered that the hon. Gentleman has followed my career with such assiduity. He is right: I defended Unionlearn and would continue to do so. Trade unions can play a vital part in ensuring the outcomes that the Government say that they seek and that I certainly believe in. Indeed, I went on a delegation to Germany—this is a minor digression, Madam Deputy Speaker—to look at their apprenticeship system with employers and trade unions, because I know that the combination of trade unions and employers was critical to driving the skills agenda. Again, it would be useful to hear from the Government what they think about that. How will they engage with the trade unions? Because trade unions are not mentioned in the Bill at all, we are left to wonder what will happen, as my right hon. Friend the Member for East Hampshire said in his excellent speech, when the Secretary of State seizes control of apprenticeships from the current structure.

There are a number of other questions to be put. The hon. Member for Chesterfield (Mr Perkins) made a very good point about SMEs. One challenge when I was a Minister, and for subsequent Ministers and this Government, was in engaging more SMEs. I am not sure that we were successful in that. I launched a review of how we might do that; it was typically by making the system regulatory and trying to review some of the paperwork. Again, as the Bill moves forward, what more will we hear about how to engage more SMEs? If we say to someone in my constituency that there are really good engineering apprenticeships in Derby, which I am told is in the same part of the country—or in the same region at least, whatever that means—we might as well be saying that there are apprenticeships on Mars, because they will not be able to get to Derby to study. We really need the spread of apprenticeship accessibility, which SME involvement provides. It is the only way of creating the reach that is necessary to engage more young people and adult learners in acquiring those skills.

I have one or two further questions, with which I hope the Minister can deal. I have already spoken about employers. On the status of the new body, is it the Government’s intention, as the Secretary of State implied— but no more than that—for it to become a non-departmental body in the end, or will it always be an in-house body? Anyone who has been close to government will know the significance of those two options. It needs at the very least to be a non-departmental body if it is to have the necessary freedom and independence to respond to employer need and changing economic circumstances. The Secretary of State hinted that that might be the direction of travel, but we do need to know more when the Minister sums up.

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[Andrew Pakes (Peterborough) (Lab)]

It is an honour to follow such a passionate speech about apprenticeships from my hon. Friend the Member for Worcester (Tom Collins). I was going to thank the right hon. Member for South Holland and The Deepings (Sir John Hayes) for raising John Ruskin and William Morris in the Chamber—I certainly think they should be mentioned more often—but I will amend my comments to say that it would be nice to have some Opposition Members in the Chamber for this important debate.

[Laura Trott]

Hey!

[Andrew Pakes]

It is nice to have some—to have some more would be quite good.

Whereas we have had William Morris and John Ruskin, some colleagues seem to have been getting speechwriting advice from Lewis Carroll, because some of the speeches from Opposition Members have been through the looking glass in their description of the problems and what is happening. We are lost in a debate where people are stuck on the function of a body, rather than the purpose we are trying to achieve, which is to change and enhance people’s lives.

Before I continue, I must declare my interest. Alongside my hon. Friend the Member for Chesterfield (Mr Perkins), I am co-chair of the all-party parliamentary group on apprenticeships. Apprenticeships are my passion in this House and in life, so I certainly believe that the transfer of functions and assets from the Institute for Apprenticeships and Technical Education to the new Skills England body is an overwhelmingly positive move. It was a proposal made in our manifesto—another promise made and kept by this Government.

The rationale underpinning this Bill is simple enough: the scope of the institute was too limited, and it is letting too many people down. Vitally, Skills England will work with young workers on their learning journey, signposting them through the maze of qualifications and apprenticeship opportunities. More than that, it will identify the skills gaps in our economy and work with the Industrial Strategy Council and the Migration Advisory Committee to plug those gaps. This matters to me, because in Peterborough, we have some of the highest levels of youth unemployment in the country. Apprenticeship starts are down, and unemployment is up.

It is clear to me that the work of Skills England must be aligned with the new industrial strategy, something we heard too little about from Opposition Members in their discussions of this issue. It does not matter what structure we have if we do not have industrial purpose, which this Government will bring to our growth mission, but also to our mission to remove barriers and transform lives. We must have cross-departmental, cross-agency, joined-up working to deliver the skills revolution and take us out of the old silos. When the Minister replies to the debate, I encourage her to detail how the industrial strategy and new Skills England bodies will work together to create those transformational opportunities. I also invite her to talk about how the growth and skills levy will fit together with Skills England, enabling us to deliver on those ambitions.

Our No. 1 mission is economic growth, spread to every part of the UK and built on a diverse base of industries and services. That mission will be hamstrung unless we unleash a skills revolution. The first report of Skills England made that clear, and it shows the scale of the challenge. Employer investment in training has been in steady decline over the past decade, with training expenditure at its lowest level since records began in 2011. Investment per employee is down 19% in real terms. I know from talking to business leaders in my constituency that they find the qualifications landscape and the institute bewildering. They tell me that skills supply is often mismatched against demand and that there are insufficient ways to encourage employers to invest in skills. I know from talking to learners in my constituency that the journeys into careers are poorly signposted and often blocked. Learners too often lack the essential literacy, numeracy and digital skills they need prior to apprenticeships to get the jobs they need.

In short, we do not have the skilled workers to do the future jobs that will drive growth. This Bill goes a long way to addressing that by setting up the institution and the purpose to get us there. Apprenticeships are the golden thread that run through this Government’s ambitions for growth. The new Skills England must recognise the centrality of apprenticeships to that and bring them centre stage into our economy.

As so many others in the Chamber have discussed today, the breadth, talent and determination of the apprentices I have met has been humbling, whether that is the butchers’ apprentices in Newborough, construction apprentices at Laing O’Rourke building a new Olympia or creative learners at the Fashion Retail Academy. Recently, I was delighted to welcome engineering apprentices from Caterpillar in my constituency to talk to us.

These apprenticeships will give young people a clearer route into careers where the nation has skills gaps. The new levy we are talking about will fund short apprenticeships, giving learners and employers greater flexibility. Overall, we must elevate the status of apprenticeships in our society and culture. I am not decrying our universities, but we must end the snobbery that says an apprenticeship is second-best to a degree. We must tackle the outmoded idea that learning and earning is a lesser option for young people. We do not hear that lazy trope in Sweden or Germany, and we should never hear it here in the UK. My third question to the Minister is: how will Skills England work through this legislation to elevate the role of apprenticeships in our society?

Skills and apprenticeships are not only the engine of growth, but the ladder of opportunity. The Minister will have seen the excellent briefings on this Bill from the Co-operative Group, of which I am a member, and one of its central challenges is that we should not just be creating more apprenticeships, but ensuring that Skills England has a responsibility to improve outcomes for those from lower socioeconomic backgrounds, including working-class kids in my constituency. That will ensure that the new body has social mobility baked into it from its inception. That will not only deliver better outcomes for those from working-class backgrounds, but will encourage Skills England to thoroughly measure the impact. When the Minister responds to the debate, will she talk about how we will measure the impact in cities such as mine, as well as the country as a whole?

This is a wonderful Bill, and I am pleased to support it. I am pleased to put on record my support to the ministerial team, particularly Baroness Smith of Malvern in the other House, who has been kind with her time and brilliant with this Bill.

Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [Lords]

Andrew Pakes Excerpts

Report stage
Monday 31st March 2025 Commons Chamber

[Damian Hinds]

Of course we should be listening to colleges such as Bournemouth and Poole college. We heard the Government announce earlier that thousands of people were going to go into construction, but then say that they could not do anything until they created this body and subsumed the functions of IfATE into it. I do not see how all those things fit together. Yes, we want more people going into construction, and a long list of other sectors too, but that does not necessarily mean an apprenticeship in every case. There is a whole suite of existing technical and vocational courses, and T-levels are still ramping up as well.

On breadth versus depth, IfATE has a huge range, with more than 600 occupational standards for apprenticeships, T-levels and higher technical qualifications. Skills England is initially looking at a narrower set of sectors, but has a much broader remit for them, so it does more than IfATE. There are three big things on its list. The first is to identify where skills gaps exist, which is itself a very significant task. It may at first glance sound obvious, but it really is not. First, there is a question of what time horizon we are talking about. Are we talking about today, or planning five, 10 or more years into the future? More significantly, I am sure people would generally say that we could train more people to go into the social care sector. The issue is not so much whether we have the training courses available, but whether people are willing and happy to go into the sector. That is a broader question.

Secondly, Skills England has to work across Government with the Industrial Strategy Advisory Council and the Migration Advisory Committee, as well, of course, as with the Labour Market Advisory Board, under the DWP. The MAC is a well-established body, having been around for a number of years, that has a remit on immigration; it will not necessarily have the same perspective as Skills England. As the hon. Member for St Neots and Mid Cambridgeshire rightly said, the ISAC is going to be given its own statutory footing, which begs the question of where in the hierarchy Skills England will be. We want this to be a body that is able to speak authoritatively right across Government.

Thirdly, Skills England is going to identify the training that should be accessible via the growth and skills levy. That, again, is a huge task. What can be funded from the levy is a huge strategic question. What specific skills should we rightly expect a firm to provide, and what should be generalisable skills for the economy?

Even after all that, there is still the big question about supply and demand at college level—this may come back to the point the hon. Member for Bournemouth East (Tom Hayes) made about listening to colleges, on which he was absolutely right. We do not currently stop people doing courses because there is a surplus of people in such and such a sector and a shortage somewhere else, but some hard questions are going to come up around the funding formulae for these things to ensure that we do have enough people going into construction, social care and so on.

My contention is that each of those functions is enormous. Amendment 6 would, therefore, perform a useful role. It is not about dither and delay, but about allowing Skills England to establish itself and to carry out those key strategic functions that it is there to do, and then to be able to subsume the functions from IfATE.

[Andrew Pakes (Peterborough) (Lab)]

It is a pleasure to follow the contributions of the right hon. Member for East Hampshire (Damian Hinds) and the hon. Member for St Neots and Mid Cambridgeshire (Ian Sollom), who spoke powerfully to their amendments. It may disappoint them to know that I will be speaking against both new clauses, as they risk undermining the speed with which we need to effect change in the sector.

It is a privilege to speak in this debate on a subject about which I am very passionate, and as co-chair of the all-party parliamentary group on apprenticeships. The transfer of functions to the Secretary of State and the creation of Skills England is one of the most critical reforms this Government are due to bring about. It addresses one of the most damaging legacies of the previous Government: the fall in apprenticeships. This matters when we look at the structure of the Bill, which is why I am concerned about new clauses 1 and 4 in particular. It also matters in constituencies like mine in Peterborough, and in neighbouring St Neots and Mid Cambridgeshire, where we have seen falling apprenticeship starts, falling training and rising unemployment. Peterborough is a city with one of the highest levels of young people not in education, employment or training. This is not just the folly of opportunities lost and young people let down, but the story of a failed economy.

I take the opposite view to that expressed by the right hon. Member for East Hampshire, who seemed to elevate the independence of Skills England as a virtue in respect of what it could deliver; I see the independence of IfATE as one of the tools that led to its failure. The fact of its independence removed it from economic need, made it bureaucratic and meant it failed to address the needs of businesses and other providers to get the flexibility and delivery of skills that we need. Independence does not always guarantee success or the things that we need.

[Damian Hinds]

Would the hon. Gentleman extend that principle to the academic route? I have asked the Minister this question a number of times now. I do not think we would stand for anyone saying that the standard and specification for A-levels should be set in Sanctuary Buildings by the Department for Education. If we would not do it for A-levels, why would we think it is right for T-levels? What is the answer to that?

[Andrew Pakes]

I think we need a mixed economy in this area. The principles I elevate in this debate are speed, substance and bringing businesses around the table, alongside providers and colleges—such as my excellent provider in Peterborough, ARU Peterborough, with its new university campus—to deliver the goods and get the job done. My concern with new clauses 1 and 4 and amendment 6 is that they elevate a level of independence that does not address the overall issue.

In fact, many of the issues the right hon. Member for East Hampshire described in his speech were actually around delivery and political choices. Having the Secretary of State and the Department establishing Skills England will make it much more likely, in my view, that we deliver at speed on those challenges. However, I am sure scrutiny will come from all parties of this House if that is not the case.

Our No. 1 mission is economic growth, spread across all parts of the UK and built on a diverse base of industries and services. The Government have already made a powerful start, which could be undermined by these amendments if they cause further delay, with early work on the growth and skills levy to drive up standards and places, the move to functional English and maths, foundation apprenticeships providing flexibility and a route in, and a £600 million investment in construction skills. I particularly welcome the replies from my right hon. Friend the Minister for Skills, who has acknowledged in written answers the need for social mobility to be a factor that Skills England will consider, so that we can actually change people’s life opportunities. This is something I am passionate about, and which the Co-operative Group and other employers I have talked to consider to be very important. This mission will fail without the urgency needed to get the Bill passed and to get Skills England up and running.

Skills England has already been set up in shadow form. Given the urgency of the task, it provides the best of external industry leadership in its Skills England shadow board, which will move to a full board. It provides independence for the voices around the table, and therefore already meets the needs that new clauses 1 and 4 seek to address. It also focuses on delivery and the speed with which we can get going to bring jobs and opportunities to all parts of the country.

The Government had already been clear, before these new clauses and amendments were tabled, that the transfer of the institute’s statutory functions to the Secretary of State will introduce more flexibility to the skills system, which I wholeheartedly endorse. It will allow us to be more responsive to the needs of employers, learners and the economy, which I also endorse. The Secretary of State will delegate these powers to Skills England. I think new clauses 1 and 4 risk delaying and creating confusion, rather than aiding purpose and delivery of what we need. I therefore oppose the moves to create a separate Executive agency or to bind Skills England before it is even created.

We need to get going. This is not just a political slogan or the subject of debates in this House, but the message I hear from businesses, providers and schools in Peterborough. We need a genuine partnership in places such as my community between colleges and employers to ensure that we are providing leadership at all levels; we need practical action and leadership, working together to improve lives and our economy. The independence of IfATE, as I said earlier, elevates it to a level that risks undermining the ability to get going quickly.

Let me provide an example. A few weeks ago, I met MDS, a not-for-profit membership organisation in my constituency that is a pioneer in flexi-job apprenticeships and training in the food supply chain, working with some of the biggest names in the food sector to create a workforce for tomorrow. It is looking to Skills England and this Bill to create the flexibility and opportunities that businesses and learners need. It would be sorry to see any delays or confusion over structure when it knows what needs to be done to get the jobs. It wants this Bill.

Can the Minister say what additional funding and resources are available to help businesses to provide pre-apprenticeship training for individuals who have been unemployed long term? Businesses want the Government and Skills England to do that quickly. They want to understand how, with SMEs and others, the Government are supporting the growth of flexi-job apprenticeships to help industries to attract new talent into the food and fresh produce industry. That is a direct criticism of IfATE and the structures we already have, and there is concern that delay through new clauses 1 and 4 will make it more difficult. As we have heard, Skills England will identify the skills gaps in our economy and work with the Industrial Strategy Advisory Council and the Migration Advisory Committee to plug them. The direct link between the industry, the MAC and the Industrial Strategy Advisory Council will address our industrial need and purpose at the necessary speed.

The new clauses are not necessary. This is a Bill about skills and about addressing our skills shortages, and it needs to get going. I support the Bill and oppose new clauses 1 and 4 and amendment 6.