At a time when images of Culloden pour from our screens and appear in our newspapers and other journals week by week, it may be that it is another lost cause that I espouse in this brief debate this morning, in which I look forward to the response of my hon. Friend the Under-Secretary of State for Education and Employment.
The London Electronics college in my constituency was founded in 1892 as the British School of Telegraphy. Although it did not invent the morse code, it was the crucible within which morse code was developed and expanded across the world. Morse code became a method of communication which saved many lives in the course of the century which divides us from the beginnings of the British School of Telegraphy. Morse code has now been largely supplanted by other means of communication on land, sea and air, but it still exists in a reduced state in different parts of the globe. The London Electronics college has in the 104 years which separate us from its founding played its part in those events, but more recently has devoted its attention to the development of courses in electronic engineering. It has been a leader in the provision of such courses to a considerable number of students, both students from overseas who come to learn and develop their skills here and our own young and not so young people who wish to acquire skills in electronics which they can bring to bear in their own commercial and industrial futures.
In the past few weeks we have discovered that no new contract is to be given to the London Electronics college for its development of electronic engineering skills. The college faces in the next 12 months a progressive winding down of operations in Penywern road and, unless fresh thought is given to the issue, closure. My case for the college rests not on some sentimental adherence to the past but on the important and crucial role that I believe that it may be able to play in the future.
Last year it was my privilege to visit the college and see the exciting work that was being conducted there and the commitment not only of the students aiming to develop their skills but of the staff and management, who have devoted themselves to improving and developing steadily the teaching and output of the college.
We all know how immensely important the future of engineering and perhaps particularly electronic engineering is to the commercial future of the country. My hon. Friend the Minister for Science and Technology was recently keen to stress the importance of encouraging high calibre young people to take up careers in engineering, including electronic engineering, and he has been instrumental in introducing into our schools schemes, such as the engineering education scheme and headstart, to encourage young people within the mainstream education system to take an interest in and develop an enthusiasm for engineering. That is an admirable, indeed essential, part of our commercial and industrial future.
We now know not only that the London Electronics college faces closure in the not-too-distant future but that, as the principal of the college wrote to my right hon. Friend the Deputy Prime Minister about four weeks ago in response to a speech by him on the engineering profession:
All technician training in London has effectively been closed down by Centec"—
the training and enterprise council responsible for training in central London—
The London Electronics college is a major part of the system in London for the development of electronic engineering skills. The clouds are gathering over its future. None of the fault can be laid at the door of the management or staff. There is no lack of applicants to take up places on the courses in the college. Complicated administrative reasons play some part. They involve first the Government, who operate mainly through the Government Office for London, then Centec—the organisation responsible for training across a range of skills in inner London—and the London Electronics college at the end of the process.
The chief executive of Centec is Mrs. Gwyneth Flower, a lady for whom I have considerable admiration. I have watched the enthusiasm that she has brought to her task. In a letter to the London Electronics college in the middle of last year she set out the reasons why clouds were beginning to gather, even then. She said:
Firstly, the category of trainees for which we are responsible are defined by the Government and are as follows: those six to 12 months unemployed, those 12 to 24 months unemployed, those with more than 24 months unemployment and those with special training needs. Between Government and ourselves we have to attempt to forecast the number of trainees in each category over the year in order to establish our average contract value. Each of the above categories is paid for at a different rate and you will see that this leads to a fairly complicated situation which has a major influence on our contractual flexibility"—
that is to say their ability to provide what people who are out of work need in order to acquire the skills necessary to return to productive work.
Mrs. Flower went on to say:
I wish to make the point that it is Government policy to emphasise the delivery of jobs from TEC training programmes and, as a consequence, the value of a higher education qualification has been reduced from four to two points"—
that is to say in assessing the performance of the providers. She continues:
This is not of our making; it is part of a Government requirement placed upon us. While we may protest about this, the requirement remains.
If we are looking ahead to our future in the business of electronic engineering, the continued provision of high-quality skills will lie at the core of what we all, if we look at it in a rational way, should endeavour to produce. In essence, we are taking too short-term a view of the development of skills in what I reiterate will be an important part of our future commercial success.
We have reached the point where no training and enterprise council offers advanced engineering training for adult retraining in the London region. Last month, Centec cut all training provision by one third with only two weeks' notice. TECs are influenced—"encouraged" may be too strong a word—to place payment emphasis and recruitment on job outcomes, not on national vocational qualifications or on higher education. I believe that that is a short-term way of looking at this area of activity.
I understand that some TECs are now paying commercial recruitment agencies to obtain jobs for them, which would have been obtained by applicants anyway. Agencies are then double funded—by employers and by TECs. I am also told—the Minister can confirm whether this is true—that some recruitment agencies have been making special deals with his Department to get this funding.
TEC funding is not going to the long-term, high-quality training that ought to be our first priority in this important area. As I understand it—I have no reason to doubt the information that I have been given—in order to achieve the training outcomes set by the Government, emphasis is increasingly being given to things such as low-level keyboard skills or to what is called, in the jargon of the trade, training hamburger flippers—that may be an overstatement. There is a reducing emphasis on high-quality skills and an increasing emphasis on low-level skills that can produce the right figures but do not underpin our industrial success for the future.
Our jobless youngsters deserve better than this. Young people who have been unemployed for more than six months undertake low-level training schemes that have a low skill requirement and they receive short-term training. They then go back on the register. That may do something to reduce the number of people on the unemployment register at any particular time and it may help to keep those figures down, but our young people deserve better than that. They ought to have the opportunity to acquire higher skills that not only provide them and their families with proper levels of remuneration but underpin our success in these areas for our industrial future. I am sure that our future prosperity depends on a better answer than the one we have at the moment in the training area. The London Electronics college provides that. It would be a tragedy if it were to close.
I endorse the remarks of my right hon. Friend the Member for Chelsea (Sir N. Scott). I know of the high reputation of the London Electronics college and I was appalled to hear that no new contract will be forthcoming, as was mentioned by my right hon. Friend. First, I was the Secretary of State for Employment who introduced training and enterprise councils. The idea was to get away from the kind of bureaucracy that had harmed training in this country for quite a number of years. We had a so-called national training system that was far too bureaucratic, that was not owned and that was entirely ineffective.
The aims of the training enterprise councils were that they should be owned locally, that they should be flexible, that their training should be relevant to the people living in the area, that the public sector should be involved and that we should train people with skills and for skills. I am bound to say that I have been concerned about the complaint after complaint—my right hon. Friend graphically illustrated this in the letter that he read out— that I have heard about what I would call a creeping bureaucracy coming back into the training and enterprise council system. If that is so, it is certainly not what was intended. I hope that the Government will look at the points made by my right hon. Friend in this respect.
Secondly, the aim of the training and enterprise councils—indeed, the aim of any sensible training system—is to train people in skills. It is important that there should be a job for people at the end of the day, but one cannot have a training system entirely plugged into the employment market in every respect. It may be that in some areas training—for example, training at the London Electronics college—will lead to higher education and further training. One should not turn one's back on that.
I am concerned with the issue that my right hon. Friend has raised. There are signs that the new training and enterprise council system that the Government introduced to get away from the national bureaucracy of the old Manpower Services Commission and all that that entailed is being slightly misused. I hope that the Government will be able to give some indication that the future of the London Electronics college will be looked at again and that a better solution will be found.
I am grateful to my right hon. Friend the Member for Chelsea (Sir N. Scott) for initiating the debate. He has shown considerable diligence in this matter over some months. He raised the issue in a letter to the Secretary of State. Obviously, he is concerned about the future of the London Electronics college, which is in his constituency. I preface my remarks by making it clear that it is primarily a matter for the parties concerned. I shall address the points raised by my right hon. Friends the Member for Chelsea and for Sutton Coldfield (Sir N. Fowler). The detail of the contract is a matter for the parties concerned.
The college has been a Central London training and enterprise council provider for the last four years. The use of the name "college" does not mean that it is necessarily part of the further education sector or that it is a formal college under the local education authority. It is a wholly private organisation—Government Members would not expect me to suggest that that is a criticism; I am putting the matter into context.
The college has been a Centec provider for the last four years and it has been providing courses in a number of areas related to electronics, engineering and applications systems. It has offered national vocational qualifications at levels 2, 3 and 4. The college has been successful in meeting the targets set in its contracts for the number of trainees achieving NVQs—in fact, 38 per cent. of the trainees obtain an NVQ.
However, the college has been unsuccessful in meeting the targets for the number of trainees who leave training and then enter employment. That is now the key performance indicator under training for work, to which my right hon. Friend the Member for Chelsea referred. My figures show that only 4 per cent. of its trainees obtain jobs at the end of their courses, compared with the national target—and achievement—of close to 45 per cent. That is a clear difference in achievement—it is not a matter of a few points.
My right hon. Friend also referred to the issue of training and its relationship to jobs. Of course, training must not be wholly related to the jobs that exist at the time. However, it is equally true that training cannot take place in a vacuum away from the labour market. Obviously, I pay immense tribute to my right hon. Friend the Member for Sutton Coldfield for introducing TECs with a considerable amount of vision.
My right hon. Friend the Member for Sutton Coldfield will recall my humble membership of the Employment Select Committee at that time and the considerable enthusiasm that its Conservative members had for his proposal. The development of TECs is a great change in the delivery of training. One of their principal duties is to examine the local labour market and ensure that the training that is provided relates to its needs. Clearly, it is important that the training for which TECs contract relates to local needs, where real jobs exist.
My right hon. Friends know that TECs are, rightly, independent companies led by local business people for the reasons that my right hon. Friend the Member for Sutton Coldfield described when he set them up. They work under performance-related contracts with Government and their mission is to provide the country with the skilled and enterprising work force that it needs. There can be few hon. Members who would dissent from that mission.
Each TEC agrees a corporate plan with the Secretary of State in line with cross-Government strategic guidance and an economic assessment of the needs of its area. Those corporate plans are publicly available and form part of longer-term, three-year licensing arrangements. We are coming to the end of the first phase of the licensing programme because the majority of TECs now have three-year licences. Each has a duty to secure value for money and to maximise performance. They have a duty in respect of, and are accountable to this House through me and my right hon. Friend the Secretary of State for, their guardianship of public funds.
Ultimately, it is not the future of individual training providers that matters—over time quite a number have closed their doors for various reasons—but future adequate provision for the labour market and for all potential students who wish to undertake some form of training. I entirely share the enthusiasm of my right hon. Friend the Member for Sutton Coldfield for the concept of TECs and his concern about the rumours of what he called "creeping bureaucracy". There is no doubt that some training providers are concerned about that. My right hon. Friend may know that an efficiency scrutiny of the Government's relationship with TECs has recently been undertaken. A 40-point plan came out of that and we have rejected only two of those points. Almost all of them were implemented at the beginning of April. One or two of the bigger points will take until next April to implement.
There is also some concern—I have raised this with TECs and we are taking it forward—that some bureaucracy has been generated, not by Government but by individual TECs. We must tackle that. Putting my tongue in my cheek, I could say that the price of setting them up as independent companies, as my right hon. Friend the Member for Sutton Coldfield rightly did, is that I have that much less control over what they do. However, I am anxious to address the problem of bureaucracy.
The performance of every TEC is kept constantly under review and we publish each autumn tables comparing achievements that relate especially to the annual contract with my Department. As part of those negotiations, we expect that in the current year 197,000 training opportunities will be provided under training for work, which will lead to 45 per cent. of those trainees obtaining jobs. I emphasise the difference between that 45 per cent. and the actual achievement of the London Electronics college.
My right hon. Friends will no doubt be aware of this morning's excellent news that unemployment has fallen yet again to 7.8 per cent. of the population. That is an important factor because it underlines the Government's belief that the principal responsibility for training, especially to higher level skills, to which my right hon. Friend the Member for Chelsea rightly referred, must lie with employers. The Government cannot be expected to provide all the training that may be required by employers.
We believe that training for work should be focused on getting unemployed people back into the work force and doing something useful. Although my right hon. Friend the Member for Chelsea referred to hamburger flippers and low-level skills, that is not the objective of training for work—although there are some service jobs that may fit that description. We want people to get back into work and, once there, for employers to shoulder the burden of improving and developing their skills. We have ample evidence that that is happening. The surveys that came out this morning with the unemployment figures show that employers are expecting, yet again, to increase their investment in training.
I shall now deal with the specifics of the London Electronics college. I understand that Centec, the TEC that covers the area, reviews the performance of all its training providers as part of a continual examination and review of its training strategy. We all appreciate that it is important for it to review its contractual partners and, where necessary, to make changes. As a result of that, Centec decided not to contract with the college this year.
My right hon. Friend the Member for Chelsea made two suggestions that he believed to be correct. I think that they are both wrong but I will check them. He first suggested that Centec cut its training for work programme by a third at two weeks' notice. Colloquially, I may say that it is news to me if it did; there would be no justification for that. The Government have not cut training for work by a third and certainly not at two weeks' notice. Our plans for training for work for the coming year were published in the public expenditure survey at the end of November last year. I do not believe that Centec would have had any justification for doing that. I would therefore be very surprised if it had done it.
My right hon. Friend the Member for Chelsea also referred to the suggestion that recruitment agencies operate to get people into work and that there may be special deals with my Department. Certainly, there are no special deals with my Department. As far as operations with TECs are concerned, I cannot say that categorically but, again, I would be surprised if that is happening. I would be very disappointed and would wish to investigate the matter further. As far as the Department is concerned, it is not happening.
I know that Centec has been in discussion with the college and that they have discussed how the college might attract alternative funding. I was concerned when I read the information about the college to find that more than 90 per cent. of its funding is from contracts with TECs, principally with Centec. That is a very high proportion of its eggs in one basket.
Alternatives may be possible. For instance, the college may wish to consider the possibility of funding from the Further Education Funding Council as an external institution. The council may provide funds to institutions and bodies outside the further education sector for provision that falls within schedule 2 of the Further and Higher Education Act 1992 and where the council can be persuaded that existing provision is inadequate. Currently, applications for council funding by external institutions must be sponsored by an institution in the FE sector. The Government have already made it clear in the last competitiveness White Paper that we intend to remove that requirement, but it exists at present.
Ultimately, as my right hon. Friend the Member for Chelsea said, we must be concerned about where people will get training in future. In the past 24 hours I have carefully examined what is available in central London. Several FE colleges serve the area—Southwark, Lambeth, City of Westminster and Hammersmith and Fulham. They provide a range of full and part-time electronics and electrical engineering courses. It will be for the FEFC to decide whether there is a need for further provision. If it did so decide, it could fund it.
I shall not bore the House by going through the substantial list of courses that are currently provided in the area that my right hon. Friend represents. Alternatives are already available. That undermines the statements made by the head of the college in the letter to my right hon. Friend the Deputy Prime Minister, to which I know he will respond shortly. There is clearly alternative provision. Despite that, the college may wish to consider approaching FE sector colleges in its area with a view to seeking sponsorship for funding in the year to come.
I know that my remarks will not have brought all the help that my right hon. Friend the Member for Chelsea wished for. I am sorry that I am unable to be as helpful as that, but I hope that I have explained some of the background and, most importantly, that there is alternative provision. There is scope for the college to consider other ways forward and I hope that it will do that.
I hope that I have convinced both my right hon. Friends that there is a considerable amount of good work happening in the TEC movement, for which we all wish to pay tribute to its progenitor. I thank my right hon. Friend the Member for Chelsea for raising the subject.