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Industry and Education

Part of the debate – in the House of Commons at 5:59 pm on 21st November 1994.

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Photo of Nick Harvey Nick Harvey Shadow Spokesperson (Trade and Industry) 5:59 pm, 21st November 1994


British industry's problems, and the possibility of education helping to resolve them, are real. The skill shortages are the product of education systems that have not delivered what society and the economy have sought of them. I wondered when I listened to the Secretary of State today what his priorities and those of the Government are, as they look to the future and seek to improve our investment performance.

The great problem with our economy has been one of under-investment, yet all that one can read into the Government's economic policy is that there will be tax cuts before an election, as there were in 1974 and 1987, for example. Those cuts were followed, as ever, by huge tax rises to make up for what the Government had cut.

We need a Government who are prepared to look to the longer term and do something about under-investment. Investment per head per annum in Britain is currently £2,800. In France, it is £3,800. In Germany, it is £4,500. In the United States, it is £5,500 and in Japan, it is £6,500. We look to the Government, in their economic and industrial policies, to do something about that, and to introduce measures, perhaps in the Budget, to stimulate investment in the future.

We had hoped that the Government would look anew, as the privatisation programme has run out of steam, at the possibility of encouraging public-private partnership investment schemes. The hon. Member for Erith and Crayford (Mr. Evennett) talked about skill shortages and the need for training measures to do something about them. We welcome recent Government initiatives on vocational training, but it is a point worth making that we still have a long way to go to catch up with our economic competitors.

Only 25 per cent. of Britain's work force have any vocational qualification. That compares with 40 per cent. in France and 63 per cent. in Germany. An example is the fact that we are 22nd out of the 22 Organisation for Economic Co-operation and Development countries when it comes to producing qualified engineers. It is little short of a national scandal that, with 2.5 million people unemployed, many British firms find that skill shortages are holding them back from exploiting economic recovery.

Rectifying the under-investment in people's skills must be a more pressing priority than funding pre-election tax cuts. If we are to succeed in the global economy, a well-educated, well-skilled, adaptable work force is critical. That requires action from the early years, through post-16 training, to continuing opportunities for retraining and reskilling throughout adult life. Learning should be a continuous process. It is vital to both personal development and fulfilment and to Britain's economic success.