Apprenticeships

Lord Haskel Excerpts

Thursday 15th October 2015 Lords Chamber

[Lord Haskel (Lab)]

My Lords, in their recent paper, Fixing the Foundations, the Government seek a higher pay and lower welfare society, giving people the chance to work and progress. Apprenticeships used to provide this but, as my noble friend Lady Morgan told us, the system did not adapt to the economic changes of the 1970s and 1980s and was virtually abandoned in favour of national vocational qualifications. Manifestly, they failed to deliver on pay, productivity and standard of living. As a result, in recent years, apprenticeships have come back.

Yes, apprenticeships came back in favour, but at the same time they became politicised by setting targets to be met speedily and cheaply, with little measure of quality, irrespective of age or need. Those wonderful apprenticeships at Rolls-Royce, Siemens, BAe, JLR and the places which the noble Lord, Lord Battacharyya, told us about have become the exception. As my noble friend Lord Macdonald reminded us, in last week’s report from the Sutton Trust, many lower end apprenticeships have become little more than cheap labour schemes.

Thanks to the noble Baroness, Lady Wolf, and the Richard review, we have come to realise how ineffective those apprenticeships are in raising our productivity and standard of living. The best schemes, which benefit the nation’s economy and people’s standard of living, take several years, involve a lot of input from an employer and require formal tuition, but only 30,000 positions have so far been higher than school GCSEs. The Government’s own apprenticeship survey found that 21% of apprentices are receiving no outside training.

I welcome the Government’s intention to raise standards above those laid down in May 2012 with the Trailblazer scheme, as recommended by the Richard review, but lots more is needed. The first thing is to take apprenticeships out of politics, abandon targets in favour of standards and priorities, and reduce complexity. Virtually all noble Lords who spoke are in favour of this—are the Government? To this end I would, like other noble Lords, welcome an apprenticeship levy.

In introducing this debate, my noble friend was concerned about the spread of apprenticeships. She is right because the world of work is changing, as your Lordships’ Digital Skills Committee reported. A lot of work is now done over the internet by independent contractors—the so-called human cloud. In accounting and legal, translation and languages, design and architecture, and computer and software, independent contractors are available, for instance, through firms such as Upwork which has 20,000 people on its list. Amazon has already prepared a platform for this which you can go on to today, so it is not just driving taxis or delivering parcels that is part of the IT economy.

If we fail to adapt our apprenticeship systems to this new way of working, as we failed to adapt in the 1970s and 1980s, there is a danger of this new style of casual labour racing to the bottom. The Minister and his department have to be creative and find a new form of employment that suits these changing circumstances and also incorporates apprenticeships. What are they doing about this? If all this is well done, we should see not only a higher standard of living based on sound economics but also the rise in skills that we need, rising productivity and a growing economy. These are things a good apprenticeship scheme will deliver to the economy, the kind of thing that my noble friend Lady Prosser spoke about when she opened this debate.