Industrial Training Levy (Construction Industry Training Board) Order 2009

My Lords, I thank noble Lords for their response. I will deal with the noble Lord, Lord De Mauley, first. I was a bit disappointed with his response on apprenticeships, but I suppose it follows on from some comments by one of his colleagues in the other place. I find it astonishing; in my recent comments about apprenticeships I have likened them to a hospital patient, and when we encountered this patient in 1997, after the tender care of the previous Government, it was in intensive care. There were only 65,000 apprentices nationwide, and just over one-quarter of them completed their apprenticeships. If you wind the clock forward to last year, for the noble Lord’s benefit, you find around 250,000 apprentices, nearly two-thirds of whom completed their apprenticeships. I regard that as a renaissance, and indeed the employers whom I meet share that view. So I am puzzled about that the noble Lord’s comments. I understand why the noble Lord talked about funding the age gap, where we fully fund those below 19 and then progressively up to a maximum of 50 per cent. Employers ought to pay some contribution towards the training cost. That is because we feel that the adult apprentice brings a bit more experience to the company and does not require quite the same amount of cost of care—they are a bit more productive. That is why there is that difference, but there is some validity in the noble Lord’s point. Whether we have the funding to be able to do that, I am not so sure. We have been focusing, rightly, on protecting the maximum number of apprentices that we can where we encounter situations where they are made redundant and on sustaining and nourishing them so that we continue to make the superb progress that we have been making towards the targets we have set ourselves, as defined in the Leitch review. We have said that we want an apprenticeship available for every young person by 2013 and 400,000 when we reach 2020. On the calculation of figures, the best thing I can do is to write to the noble Lord to explain. I believe we have provided those figures in good faith, but we will endeavour to sort out any discrepancy. I trust that the figures in my brief are the most accurate. The industry levy is there because, as the noble Baroness, Lady Sharp, reminded us—I congratulate her on her staying power if she has been through so many of these debates—the industries believe that it is valid and plays a vital role in providing training and the necessary skills for those industries. They are absolutely right. However, that depends on those industries being willing to do it. If other sector skills councils shared that view and were prepared to make those contributions, we would make progress in that direction. We have had different approaches, as noble Lords know. Other sector skills councils have embraced what they call sector skills compacts and have endeavoured to make significant progress in those directions. We have encouraged the growth of sector skills academies, again to ensure that employers have more buying power in the kind of learning they require. We are making significant progress, therefore, and spending large sums on apprenticeships—£1 billion per year for next year and the following year—and on initiatives such as Train to Gain. I did not fully understand what was meant by the completion value of an apprenticeship and maybe I will need to respond on that. From my point of view, in a general sense, we have made it absolutely clear that an apprenticeship is not completed unless there is an employer placement. In the past there was some dubiety about how to count apprenticeship figures. Now we try to make this absolutely clear. There has to be an employer placement and it does not count as a completion unless that is the case. We are now trying to deal with situations where some apprentices have been made redundant, especially in the construction industry, and may be in the last six months of their training. We try to place them with other employers or get the existing employer to enable them to complete their apprenticeship. We have had significant success here. The Construction Industry Training Board has created a clearing house where it has managed to place many cases successfully with other employers. There is more work to be done to ensure that we enable apprentices to complete their apprenticeship. It is important for the individual who has invested a lot of time and it is important for the brand so that neither the candidate nor their parents feel that the apprenticeship has been a waste of time. There is considerable consultation within the industry on who the levy applies to. That is one of the good things about the process. There is wide consultation within the industry before it comes to its conclusions. Whether or not we change the formula in relation to companies with 20 to 40 employees ought to be a matter for the training boards to determine. I cannot give the noble Lord an accurate figure for how many people fulfil all the terms of the skills pledge. I was surprised that he expressed such cynicism. What motivation has someone in signing a skills pledge? We do not give them any money to sign it although we help them with the cost of training. I have attended a number of Chambers of Commerce meetings around the country since I have been in this office. I have seen employers at those meetings who have previously signed the skills pledge telling the Chambers of Commerce members about the real benefits they have seen in training their employees, including improved customer service, improved productivity and improved returns on the balance sheet. The peer group, therefore, has constantly emphasised the benefits of training. For me to recommend it is one thing—people might be a bit cynical. When, however, their own business peer group tells them there is a real value in training all employees to level 2 and demonstrate practically the benefits they have achieved, we need not be cynical about it. However, we are monitoring the process. The one point where I would agree with the noble Lord is to have statistical evidence to show, for example, where the thousands who have signed the skills pledge are in the process of ensuring that every member of their staff has reached level 2. I can assure the noble Lord, however, that I have encountered many examples of companies which have carried out the skills pledge and have testified to the efficacy and the benefits they have achieved within their company. With regard to what the noble Lord said about the Oscars and the Film Industry Training Board levy, unless I have misunderstood the process, we do not impose a levy. The board will determine whether a levy is right. Given the uncertain nature of film financing, I think that it will take a long, hard look at it. I thank the noble Lord for that information. I have tried to cover all the points raised. I am conscious that there were one or two where I was not able to give a complete explanation, but I assure noble Lords that I shall write in those circumstances. I thank again the noble Baroness, Lady Sharp, for her comments. I also endorse her point about the smart card in the construction industry. The clear record it provides of the courses that workers have undertaken—a sort of passport as they go from site to site—is a valuable initiative. The proposals before the House relate to the construction and the engineering construction industries. It continues to be the collective view of employers in these two industries that training should be funded through a statutory levy system to secure a sufficient pool of skilled labour. I believe that it is not in dispute that the orders should be approved, and I commend them to the House. Motion agreed.