There can be no more important subject in industry, even at this early hour of the morning, than the subject of apprentice training, unless it be the retraining of those who are to be deployed. I am sure that a measure of the effectiveness which we realise in our training programme will be the measure of our economic well-being in future years. No one disagrees about the need for training. The Industrial Training Act went through both Houses of Parliament without any opposition. It is worth saying that this may not be such a good thing as some hon. Members may think. A Bill which passes through the House without criticism loses the benefit of close examination, and I believe that this may have been the case with the Industrial Training Act.
I want to make it clear that the criticisms which I shall make should not be taken as being other than helpful and constructive, because we all want to train our youngsters in the most effective way, and get the best value for the money we are spending. We want to see both apprentices and industry benefit. My intention at this hour of the morning is to confine my remarks to the engineering industry, but what I say could apply to other training boards. The Minister, in an earlier reply, has already stressed the future importance of training boards. I had intended to speak about retraining as well, but the subject has already been mentioned once today and I will not waste the time of the House in repetition, important though that subject undoubtedly is.
On the surface, we can be forgiven for thinking that everything in the training garden is fine and beautiful, but I am afraid that in the engineering garden we have a number of serpents. I want to draw the attention of the House to three of them. First, in an industry which employs one-sixth of the working population and which is as highly diversified as is the engineering industry, do we have adequate training facilities to deal with the problem? Secondly, how sophisticated need training be? Are courses to be tailored to suit the employer who has to pay for them, or should they fit into a much more national plan? Thirdly, is the Engineering Industry Training Board, as at present constituted, fairly representative of the whole industry? If it is not, the Minister must expect trouble.
The answer to the first question is that we certainly do not have adequate,
Although the larger firms may well have facilities to handle this kind of training, the smaller firms certainly have not. For their training they must turn to the local technical colleges—and they, too, are generally unable to provide proper facilities for a 48 weeks' off-the-job training. Inevitably, this means that few small employers will be able to benefit from the grant, although because they form the majority of the industry they will be paying the major part of the levy. This is causing great resentment.
In my constituency I have a number of these small firms. They point out to me that in Section 2(1) of the Act
An industrial training board shall provide or secure the provision of such courses …
Exactly what does that mean? Does it lay on the Board the responsibility for providing courses, or does "secure provision" mean a form of gentle blackmail on employers to do the providing? Evidence from all over the country suggests that the Board has failed to provide training facilities or to persuade the local education authorities and the technical colleges to lay on the type or length of course which it recommends. There is only one answer, that the Board should set up its own training establishments, or should amend its first-year training requirements at least until there are facilities for training.
How sophisticated need training be? Up to the present, engineering firms, large and small, have taken on boys as apprentices who have learned as they earned under the direction of an adult craftsman. Most also went to night school for their theoretical training: giving up their own time to learn their trade was no bad thing. That system is dead, and we are struggling to replace it with another at least as effective for producing men with skill and character. But does management know best what skilled personnel it needs? If so, is it entitled to training which is tailor-made for one business, but which may not be useful for others? This is a vital question.
The large engineering firms produce and train craftsmen suitable for themselves, and they get the grant. Can the same privilege be denied the much greater number of small, specialised firms? If it is, and it appears to be, it is equivalent to saying that the small firms must go under, which, as the Americans have proved, is a dangerous trend. To be bouyant, our economy must be based on a proliferation of smaller businesses. That is why the Small Businesses Administration has been set up in the United States and why we intend to set up a small business bureau when returned to power. The small business and manufacturer are important and the small engineering firm must be integrated to train for the purposes of its own business and not for any theoretical national purpose. It would be more to the point if the Board arranged its training syllabus around the smaller rather than the larger firms.
The Board includes the nominees' of the larger companies. They have agreed the levy system which they can afford and they have evolved a grant system conditioned to their companies' existing policies. They have produced a manual of first-year training which is futile for smaller firms—for the majority of them, at least—and which is looked upon by many as an example of the way in which bureaucracies can waste money if they come by it easily. The major part of the £75 million which the Board raises will come from the smaller companies. Ought they not in equity to be represented on the Board?
The Minister has agreed—and I am grateful to him—for his Department to receive a deputation from the Society of Independent Manufacturers, on whose executive committee I sit, and this takes place on Monday of next week. I hope that as a result of our conversations with his Department this matter may be put right. After all, as I have said, if the Engineering Industry Training Board or any other training board does not react to the view and the policy of those who are responsible for financing it, which in this case is the smaller engineering companies, the Minister and Board must expect trouble and lack of co-operation.
We ought not to forget that we lost the American Colonies from 1776 because we insisted on taxation without representa- tion. The last thing that any of us wants in an industry of this size and importance—and industry which makes the biggest contribution to the economy by way of exports—is trouble or lack of co-operation. The Engineering Industry Training Board should as a matter of course have on it representatives of every class of employer expected to finance the board.
I hope that the Minister will give careful consideration to the three major points which I have raised because I am sure that they are basic to the working of the Act which both sides of the House have helped to fashion and which both sides of the House wish to see successful in all its aspects and all its objectives.
The hon. Member for Croydon, North-East (Mr. Weatherill) started by saying that there was no more important subject than that which he had chosen for debate, even at this late hour. I should be inclined to agree, with one exception—bed, which, I think, is a little more important.
I take the unusual rôle of defending the hon. Member's Front Bench leadership. He passed a rather far-fetched remark about the Industrial Training Act going through without any proper criticism. If I remember correctly, that Bill was criticised and a great deal of work was put into the criticism, but it was one of those happy occasions on which the criticisms from both sides of the House and from industry were of a very constructive character. It would be unfortunate if hon. Members had the idea that it must be hostile criticism involving a Party battle to make it worth while.
The criticism of the Bill of the right hon. Member for Grantham (Mr. Godber) was considered. It was one of the happiest experiences of a Committee stage of any Bill in the House. Both sides of industry and of the House and all interested parties took part enthusiastically in trying to make that Bill as good as it could be.
Perhaps the hon. Member did not mean it, but some of his criticisms were sweeping. They are criticisms which have not been brought to the attention of my Ministry to the extent that he brought them. May I emphasise that the Ministry of Labour exercises no bureaucratic control over an industrial training board. The board conducts its business, and the further I keep away from it, apart from guidance and such help as I can give, the better.
The hon. Gentleman sought to place a halo around the old method of apprenticeship. I understood, in my ignorance, that the biggest criticism made by employers was to the effect that the previous apprenticeship system was out of date and had become too rigid; that the system by which a boy was trained by a skilled workman was not working well because it took too long and that, therefore, the system, particularly in the engineering industry, needed examination with the idea of introducing a better method.
There seems to be come confusion about the grants scheme. Broadly speaking, grants to employers fall under two headings, the general and the supplementary grant. The general grant is based on an employer's performance rating which is, in turn, based on the amount of training he does in relation to his needs and the quality of his training arrangements. In arriving at that performance rating, different weighting are given by the Board to different kinds of training and, to do this, a rather complicated calculation is necessary.
This is the only training board to have adopted this system and it is the result of the Board's attempt—however critical the hon. Gentleman may be; it was an honest attempt—to redistribute from the outset the total cost of training within the indusry which, as he mentioned, is estimated to be about £75 million. This sum is collected by a levy of 2½ per cent. to be distributed to firms in accordance with their performance ratings.
I accept that a valid criticism may exist because of complaints about insufficient information having been given about the way in which these performance ratings are arrived at, with the result that firms are not able to know what kinds of training carry the most weight with the industrial training board. I am informed that the Engineering Industry Training Board has decided, to meet this criticism from industry, to publish in some detail in the near future an explanation of how the scheme works.
The Board pays supplementary fixed grants in respect of certain kinds of training which it particularly wishes to encourage; for example, for students attending sandwich courses and courses for training officers and instructors. In particular, it intends in the grant year which begins on 1st September, 1966, to pay a specific grant of £504 per annum towards the cost of first year off-the-job apprentice training which fully satisfies the Board's requirements. For first year off-the-job training schemes which are otherwise satisfactory, but which do not fully meet the Board's requirements, it will pay 10 guineas per head per week if the training lasts for at least 24 weeks. This is, therefore, the same as for the payment of £504 per annum.
It has been said that this first year training scheme which the Board has set out in great detail is being imposed on the industry without adequate notice and discussion, that there was insufficient consultation with further education interests in drawing up the scheme and that technical colleges have not been given time to provide appropriate educational courses. The Board has said in reply that it is not intended that the scheme should be applied rigidly and that a degree of flexibility of interpretation has been built into it. Firms already operating sound schemes of first year off-the-job training may continue with their present arrangements, but are invited to re-examine them in the light of the Board's proposals.
I want to re-emphasise that the Board is empowered to provide training facilities itself, but it would clearly be impossible for it, particularly at this stage of its development, to provide training places all over the country for off-the-job training by small firms. That would be impossible. But to encourage the provision of first-year off-the-job training by employers—and this is of relevance to the small employer—the Board makes a grant of £150 per annum for five years towards the cost of each additional training place provided.
The Board has also made a start with the provision of its own workshops for the use of small firms, and hopes to make at least 600 extra first-year training places available within the next year. It is also encouraging the formation of more group training schemes for the smaller firms. Sixteen new schemes have been launched, and 18 others are in varying stages of development.
The Board has been praised as well as criticised by people in the industry for the way in which it has tackled the training of apprentices. I think that the Board is to be commended for taking a bold step forward in its scheme for the first-year training of apprentices on a much wider basis than at present, to be followed in subsequent years of apprenticeship by methods of training adapted to the ability and aptitude of the individual and the requirements of the firm. Experience may show that modifications to the scheme are needed, but it is also clear that much time would have been lost, perhaps to little purpose, if the Board had engaged in protracted consultations with the many different sections of the industry, and had delayed the introduction of the scheme until everyone in the industry felt ready to operate it.
The Board is giving its attention to an assessment of the manpower and training requirements of the industry, but this is clearly a long-term process, requiring an appraisal of the information supplied by employers about the number and occupations of those already employed in the industry. The Board has rightly decided that it ought not to hold up its training recommendations until it has carried out a full survey of probable future training needs.
I should like to say something about the representation of small firms on the Board. I read with interest the report of the meetings at Croydon, and I understand what is in the hon. Member's mind. I understand that there is some feeling on the matter. One of the members of the Board—Mr. Lomax—is the director of a company employing only about 300 workers. It is very difficult to have a representative Board, but the small firms at least are represented, and it would be difficult to give them greater representation without upsetting the balance of the Board. There has been, as the hon. Gentleman says, criticism about the suitability of the Board's training recommendations and its grant scheme to small firms.
With the recruitment of additional training staff, the Board has been able greatly to extend its contacts with indivi- dual firms in the industry, and to acquaint itself with their views.
The Board informs me that it is very conscious of the problems of devising training recommendations appropriate to firms of every size and will keep this matter very much in mind in considering amendments to its existing training and grant schemes. I have taken the point made by the hon. Member. He is not the only one who feels concern about the vast number of small firms which must not be discouraged or depressed in this exercise. I assure him that I will take note of what has been said.
Of course, there are many teething troubles. This is an unexplored area. The vast engineering industry is so diverse in its set-up that inevitably there will be growing pains during the early years, but we hope to arrive at satisfactory conclusions.