Opportunities for the Next Generation

Opposition Day — [20th Allotted Day] – in the House of Commons at 3:49 pm on 13th September 2011.

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Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills 3:49 pm, 13th September 2011

I beg to move,

That this House
believes that young people face a more uncertain future which may not offer the increased opportunities and prosperity enjoyed by their parents and their grandparents;
notes that, following the Government’s decision to cut public spending too far and too fast, it has targeted young people with cuts, resulting in nearly one million young people not in education, employment or training;
further notes with concern that there were no university places for around 100,000 applicants this year, that tuition fees are trebling, university places will be cut next year and many universities will lose popular courses;
highlights that the proportion of apprenticeship places for 16 to 18 year olds has decreased by 11 per cent., new apprenticeships are providing mainly short-term training for older workers, the Future Jobs Fund has been scrapped, the apprenticeship guarantee abandoned, Education Maintenance Allowance ended, homelessness has risen and homebuilding is at a 90-year low;
believes the Government must take action to secure business growth to create opportunities for young people;
resolves that the Government should repeat the bank bonus levy to create over 100,000 jobs through a youth jobs fund, to build 25,000 affordable homes and to support business through increased funding for the Regional Growth Fund;
calls on the Government to expand apprenticeships for young people and to ensure that public sector contractors offer apprenticeships;
and further calls on the Government to enact a temporary VAT cut to boost consumer spending, business confidence and support the UK’s high streets.

The motion is in my name and those of my right hon. Friend Andy Burnham and others. I thank the Minister for Further Education, Skills and Lifelong Learning, who has given his apologies for his absence this afternoon, which is for understandable reasons. I see that the Secretary of State for Business, Innovation and Skills is not here to answer the debate; he seems to be curiously reluctant to answer when I introduce Opposition day debates, but no doubt he is trying to work out how to be selected as the coalition candidate for Richmond at the next election.

We British people have always been confident that each new generation will do better than their parents and their grandparents. There have been wars and economic crises, and individual families have had their ups and downs, but what my right hon. Friend the leader of the Labour party calls “the promise of Britain” has held true. Parents have been able to say, “Our children have had more opportunities, a better education and a higher standard of living than we had.”

However, Members on both sides of the House will know that confidence in that British promise has never been more shaky, knowing that the average age of a first-time buyer is approaching 40, and that there are 1 million young people not in employment, education or training. At the same time, we have all heard young people asking whether the cost of a degree is worth it, and what the alternative would be. We have all heard parents asking how this country will pay its way in a fiercely competitive world, and what young people will do. Only a quarter of parents and grandparents questioned by YouGov believed that their young would be better off than they were.

Today, the Opposition are asking the House to focus on things that the Government should and should not have done, but let us be clear: the challenges did not suddenly emerge from a blue sky at the last election. The Minister for Universities and Science advocates the view that over decades, the older generation has in some way stolen the future from young people, and that we have so rigged the rules of the game throughout our lives that the young have only half a chance—I apologise if I paraphrase cruelly. We hear similar views across the political spectrum. Whether or not we share them—I have very strong reservations—it is clear that the generation now in power has a huge responsibility to young people, and that the changes that are needed in our economy and society are profound. Those changes will take leadership, which Labour will offer, over many years.

However, I would not be doing young people any favours if I pretended that it was only in the past year that everything had gone wrong.

Photo of John Redwood John Redwood Conservative, Wokingham

In his motion, the right hon. Gentleman states that one problem is that the Government have cut

“too far and too fast”,

but in their first year they increased spending by 5.3%, or £32 billion, and every extra pound that they spent was, of course, borrowed. How much extra would he have wanted to spend?

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

We know that the Government aim to cut sufficiently fast to eliminate the deficit in four years. Our judgment was that the right balance between dealing with the deficit and sustaining jobs and growth would be to halve the deficit over a similar period. That allows us to say not that there would never be any cuts in public expenditure, but that there would be a very different trajectory to public spending. For reasons that I will give, that difference of choice would have made a big difference to the young people of this country.

I have acknowledged that some of the problems are deep-seated and long-term, but today’s Opposition day debates focus critical attention on the Government’s actions. The charge is clear: the Government’s economic policy has directly made the lives and prospects of young people worse. They have not hit young people along with everyone else; they have chosen—I think “chosen” is the right word—to single out young people and to make their lives and prospects worse.

Photo of Alok Sharma Alok Sharma Conservative, Reading West

Yesterday the shadow Chancellor came to the House and, for the first time in 15 months, apologised for Labour’s mistakes. Are we going to have an apology from the right hon. Gentleman today for the fact that social mobility has fallen and attainment in schools has declined by international standards? By just about every measure, young people suffered under the Labour Government.

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

We will have the opportunity in a few moments to see whether that last claim is accurate, although I think that the hon. Gentleman might be disappointed. On the question of apologies, though, we did not hear yesterday an apology from the Conservative party for urging the Labour Government to deregulate further and faster in the financial services sector. Mr Redwood was one of those producing Conservative party policy documents in that vein. I think that we should hear a little honesty from the governing party.

Photo of John Redwood John Redwood Conservative, Wokingham

Will the right hon. Gentleman give way?

Photo of John Redwood John Redwood Conservative, Wokingham

As the right hon. Gentleman should know by now, the report that I co-authored stated clearly that the Government needed to regulate the cash and capital of the banks more strongly than they did. Had they done that, they would have been in a much better place.

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

But the problem did not come from the cash or the capital; it came from the complex financial instruments that were not being properly regulated, as we discussed yesterday. However, I am trying your patience, Mr Speaker, so perhaps I should make some progress.

The Government have chosen to single out young people and make their lives and prospects worse. In June I visited the Bombardier factory in Derby and talked to three young apprentices. I asked them how they saw their future in the company. “To go as far as we can,” said one. Mr Colin Walton, the chief executive officer, used to be an apprentice. That is what the promise of Britain was all about: if someone wanted to get on, they could. We all know what happened, though. The Government missed the chance to reopen the Thameslink contract, despite the many changed circumstances. It was a disastrous failure of will and responsibility, and the dreams of those apprentices now hang by a thread.

The decision to tackle the deficit by cutting spending too far and too fast has had predictable results. The economy was growing a year ago, but today it is choking.

Photo of David Evennett David Evennett Conservative, Bexleyheath and Crayford

I will if I get an opportunity to speak later, Mr Speaker. I always listen to the right hon. Gentleman with great interest, but he is rewriting the history of the Labour Government of which he was a member. The present Government have increased the number of apprenticeships dramatically. I would like to refresh his memory: in May 1997 there were 664,000 unemployed 16 to 24-year-olds, but that had increased to 924,000 by May 2010. Is that not an indictment of the failure of the Labour Government of which he was a member to manage affairs and to help young people and apprentices to get the jobs that they needed?

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

I will deal directly with both those issues in due course, if the hon. Gentleman will have patience.

Every family is suffering, but young people are paying a particularly heavy price. Young people in Britain today are not accidental victims of the cuts; what is happening to them is not some collateral damage of Treasury policy. When the Government drew up plans to cut spending too far and too fast, they decided to target young people, and they did it recklessly and without thought or heeding the evidence. They ended education maintenance awards without understanding how important they were. As the Education Committee wrote:

“The Government should have done more to acknowledge the combined impact on students' participation, attainment and retention, particularly amongst disadvantaged sub-groups, before determining how to restructure financial support.”

They got that wrong, and young people who want to stay on will suffer.

Advice and guidance to young people is essential. The Government are wrecking the careers services—but that is the subject of the second debate today. Labour’s future jobs fund had a simple aim: to prevent a destructive rise in long-term youth unemployment during the recession. All unemployment hurts, but long-term youth unemployment has the longest, most corrosive effect on its victims. And the future jobs fund worked. When it started, the number of those not in employment, education or training fell by more than 200,000. The current Prime Minister praised it when in opposition, but after the election it was scrapped, and nothing effective has taken its place. In the past year, the number of NEETs rose by more than 100,000, with 119,000 19 to 24-year-olds not doing anything productive.

Photo of Robert Halfon Robert Halfon Conservative, Harlow

Will the right hon. Gentleman acknowledge that, although there were 90,000 starts under the future jobs fund between October 2009 and January 2011, the analysis of the Department for Work and Pensions from March this year shows that half the young people involved were back on the dole just seven months later?

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

I am proud of the effectiveness of my Government’s policies in tackling long-term youth unemployment. The experience of having nothing to do has a lasting effect on people’s careers, incomes and aspirations up to 20 years after the event, and we succeeded in tackling that throughout our period in office from 1997. The reality is that that this Government have scrapped the future jobs fund and, far from introducing anything better, have put nothing effective in its place. The effects of that on young people are all too clear.

Photo of Stella Creasy Stella Creasy Labour, Walthamstow

Does my right hon. Friend agree that the Government’s contempt for young people is illustrated by the fact that the Work and Pensions Select Committee has pointed out the lack of evidence for the decision to scrap the future jobs fund and called into question the value for money of the decision? The Government did not know what they were doing to our young people.

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

My hon. Friend is absolutely right. The truth is that it was more important for this arrogant Government to scrap something because it was a Labour scheme than to look at whether it was working not. But it is not the Labour party that has paid the price; it is young people up and down the country.

Photo of Ian Paisley Jnr Ian Paisley Jnr Shadow DUP Spokesperson (Work and Pensions), Shadow DUP Spokesperson (Environment, Food and Rural Affairs)

Does the right hon. Gentleman accept that the scrapping of the education maintenance allowance, the apprenticeships fund and the future jobs fund is having a more pronounced effect in the regions of the United Kingdom? In my constituency, for example, 19,000 young people aged 16 and above do not have employment. Does he accept that this loss of benefits and opportunities is having a much more pronounced effect there than it is having even here in England?

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

The hon. Gentleman speaks with great authority about his constituency.

It is a tragedy that the importance that was attached to young people and to avoiding long-term unemployment, from the new deal onwards, has disappeared under this Government. Too many people are being pushed to the edges of the labour market, where there are too few opportunities for them. Many parents, and young people, want apprenticeships. Labour rescued and rebuilt apprenticeships. There were fewer than 70,000 a year when we took office, but the figure had increased to nearly 280,000 in the last year of the Labour Government, and those apprenticeships were more credible and successful than those that had gone before. Again, however, the new Government were keener to rubbish our record than to get their own plans right.

I have to say that, on paper, it is hard to fault the ambitions that the new Government set out: now, however, the truth is coming through. The great growth in apprenticeships has turned out to involve short-term training courses for adults. There is nothing wrong with training adults, but it is certainly not what most people think of as an apprenticeship, and it certainly does not provide new opportunities for young people. The proportion of apprenticeships for 16 to 18-year-olds has actually fallen. We need, but are not getting, longer apprenticeships in high-end technical subjects that are necessary to spur growth; we need electrical, mechanical and construction apprenticeships.

Photo of James Morris James Morris Conservative, Halesowen and Rowley Regis

I visited a forging business in Cradley Heath in my constituency on Friday. For the first time in five years, it has taken on an apprentice from a local college. It is offering a high-quality, high-tech apprenticeship to that young person, who will be able to develop the skills to get a high value-added job in the future. That is what is happening as a result of Government policy.

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

I applaud that company and those apprenticeships. That is a story that is being repeated in my constituency, but it was being repeated three or four years ago as well. The myth is that the situation has been transformed overnight. We are presented with some impressive headline statistics, but close analysis suggests that we are not getting an expansion of the high-quality opportunities that our young people and the economy need.

If the Government really had confidence in what they were doing, they would not have scrapped Labour’s guarantee of an apprenticeship for every qualified school leaver. They have also refused to require Government contractors to provide apprenticeships. In the past, that guarantee meant that investment in social housing also involved investment in training young construction workers. The Minister for Housing and Local Government described that policy as “ridiculous” and “counter-productive”, while the Minister for the Cabinet Office said that it “wouldn’t be appropriate”.

Photo of Geraint Davies Geraint Davies Parliamentary Assembly of the Council of Europe (Substitute Member)

Does my right hon. Friend agree that the key choice in cutting the deficit is the balance between growth and cuts? If the cuts reduce our capacity to grow, as do the cuts to the future jobs fund and in proper apprenticeships, they will be completely counter-productive and economically illiterate.

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

My hon. Friend is absolutely right, but there is a further point. The refusal to link Government procurement to the provision of apprenticeships has nothing to do with the deficit. It is wrong policy. The Government could take that action whatever their deficit reduction strategy, but they refuse to do so. It is not just about the deficit; it is about missed opportunities.

I am pleased to say that after what could be called a cock-up—I hope it is not an unparliamentary term—by the Government Whips, Labour’s call for green apprenticeships is now in the Energy Bill, and it looks as though it will stay there. One bit of Government will be doing the right thing, thanks to Labour, but more than £200 billion of public procurement—taxpayers’ money—could be working harder by providing apprenticeships.

Photo of Stewart Jackson Stewart Jackson Conservative, Peterborough

The shadow Chancellor apologised yesterday for some aspects of Labour policy, so will the right hon. Gentleman take the opportunity to apologise for the previous Government reckless immigration policy, whereby people were imported into low-skill and low-wage jobs, pushing many thousands of unskilled youngsters into welfare dependency?

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

I was very pleased that we ended unskilled immigration from outside the EU and introduced a points-based migration system. I think the real issue now is the damage being done in higher and further education, for example, to the country’s economic prospects by restricting universities’ ability to offer courses that attract high-paying overseas students.

The point I was making a few moments ago was that the failures in apprenticeship policy have nothing to do with deficit reduction. They were calculated decisions that harmed young people, as, indeed, did the decision to let fees treble. That is why too many students and parents are now asking whether it is still worth going to university. That policy was not required by deficit reduction. If higher education had been cut in line with other public services, fees would have risen to less than £4,000 a year. This summer, more than 100,000 determined, hard-working and qualified students could not get a university place. The first action of the new Government was to stop 10,000 new places Labour had planned for last September. Another 10,000 places will go next year. Teaching and nursing places, too, will be cut. If the students who missed out this year get a place next year, they will pay a £15,000 lifetime penalty for having missed out this year.

All this has happened because the Government lost control of fees, with most universities wanting to charge £9,000, so they are now introducing a bizarre auction to cut fees at the expense of quality. Those students who apply next year will find not only that they are paying higher fees and that fewer places are available, but that many of the popular courses they thought about getting on to this year do not even exist. Over the next three years, 60,000 places will be taken from popular courses and popular universities and given to cheaper providers—irrespective of whether students want to study them.

A degree is a good thing to get, but recent reports have highlighted the difficulties too many graduates experience in getting a job, particularly one that rewards their effort in today’s sluggish economy. That is not because we have too many graduates, but because the economy is creating too few challenging, demanding and high-value posts. Instead of being plunged into the chaos of the last year and next, universities should have been given one priority—to play their full role in creating growth, getting their knowledge, research and skills into the businesses and companies of the future. That is what a Government with a single-minded focus on jobs and growth would have done, but it is where the BIS Department, too, is failing young people and the country as a whole.

Photo of Toby Perkins Toby Perkins Shadow Minister (Education)

Does my right hon. Friend agree that it is perverse that, at the very time a generation of students are about to go to university and pay huge tuition fees, setting themselves up for decades of debt, they see people who made that choice three or four years ago leaving university with a degree, but no opportunities to move into?

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

There is a huge responsibility on the Government to respond to my hon. Friend’s challenge—to take the measures necessary, get growth going, create jobs and reshape our economy so that we can pay our way in the world in the future and make the full use of the talents of young people and, indeed, older people in this country. I say that because there will not be opportunities for young people unless we build an economy that can compete with the best in the world.

The truth is that we had to wait a year for a growth plan and it was so weak and useless that it is already being rewritten for October. When every taxpayer’s pound needs to work as hard as it can to build a new economy for Britain, the Government’s decision on Bombardier means that taxpayers’ money will needlessly be spent abroad. When every pound of taxpayer’s money needs to work hard to build the new economy, the Government are refusing to ensure that public sector contractors provide apprenticeships. When there is £200 billion-worth of infrastructure for the new economy that needs investment, the Government are dragging their feet. To see that, we need only look at the way they are doing broadband: slowly, in inefficient penny-package projects.

When we need the Government to be working with business to build the new economy, all we get is the tired mantra, “The less government does, the better.” If we are to be the very best at the things we are good at—advanced manufacturing, creative industries, business services, pharmaceuticals and renewables—government has to work in partnership with business. It must do so: to understand what technologies and skills we need in the future, so that companies have confidence to invest; to set clear priorities and stick to them, so that companies have the certainty they need to invest; to look at what government buys and how we buy it, so that innovative companies can grow; to must make sure that good regulation lets good companies win new markets; and to build, in every region and nation, the universities, the skills, the banking services and the leadership in cities and regions that will let companies grow and create jobs.

Photo of Denis MacShane Denis MacShane Labour, Rotherham

Does my right hon. Friend think that the Secretary of State is absent from this debate because he realises that, despite his many university qualifications, he is about to lose his job because of the democracy reduction Bill that the Government have imposed and the fact that his constituency is about to disappear? Is it not symbolic that this Government reduce by 50 the number of MPs and in every sector of the economy they are reducing employment as we speak? Sadly, the Secretary of State himself is included in that, but he did vote for it, so what one reaps, one sows.

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

I have already made a passing remark about the Secretary of State’s role, but let me just say that I have tried to set out briefly the sort of lead we should be getting from the Department for Business, Innovation and Skills. Active, intelligent government working with business is what we need to transform the shape of our economy, but all we are getting is the same dogmatic argument: “Government should do less. It should do less in the regions, less in investment, less in research, less in working with business.” Our young people will pay a heavy price for that.

Photo of Alok Sharma Alok Sharma Conservative, Reading West

The right hon. Gentleman is leaving the House with the impression that the Labour Government left this country with a golden legacy in dealing with businesses. Let me remind him that his party was talking about putting up corporation tax and was imposing such a level of regulation on businesses that they just could not cope, and that we were left with the most complex tax system in the world. Is that what he calls “government working with business”?

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

We must remember the situation at the end of the previous Labour Government. It is no part of my case that we were a flawless Government with no imperfections. Indeed, I am one of those who has acknowledged already in this debate the need for change, and the Labour party will undertake that. Let me just tell the hon. Gentleman three things. First, there were 1.1 million more small businesses thriving in this country at the end of the Labour Government than there were at the beginning. Secondly, the OECD reckoned that this country was third in the world for ease of setting up a new business. Thirdly, almost alone of the western European countries, we enjoyed net foreign direct investment, because businesses around the world had the confidence to invest in Britain. Not everything was perfect, but that was not a bad record to show that we worked well with business.

What we need today is a plan B for the economy and a plan B for young people to begin to restore the promise of Britain. The Government must see that cutting too far and too fast means sacrificing the growth and jobs that make it easier to reduce the deficit. We need a temporary reduction in VAT until growth is re-established to put money in families’ pockets and to boost shopping centres and jobs.

Yesterday, we saw long-term plans to restructure the banks, whose irresponsibility around the world caused so much harm, but nothing to tackle the immediate problems facing Britain. The Government should repeat the banking levy, raising £2 billion, and with the money they could reduce the damage done by ending the future jobs fund by establishing a £600 million youth jobs fund. The Government could get young people back to work by building 25,000 affordable houses. We could boost opportunities by investing in high-growth small businesses. When every taxpayer’s pound needs to work as hard as it can, the Government should grasp the nettle and require public sector contractors to provide apprenticeships for young people.

For too long, this Conservative-led Government have blamed everything bad that has happened in this country on the unavoidable effects of deficit reduction. They are not just wrong about the pace of deficit reduction, however. Deficit reduction cannot be used as a systematic excuse for, in plain and simple terms, bad policy and missed opportunities. It will take more than this Government to restore the promise of Britain, but in the meantime they could at least stop making things worse.

Photo of David Willetts David Willetts Minister of State (Universities and Science) 4:16 pm, 13th September 2011

Of course, the Government oppose the motion. I regret that we are depleted as a result of efficiency savings, but I should explain that the Secretary of State is battling for Britain and representing British business in Paris and, sadly, our colleague the Minister for Further Education, Skills and Lifelong Learning is recovering from a minor operation in hospital. I hope that satisfies the House on our position.

I assure the shadow Secretary of State that despite our disagreement with many of the assertions in his motion we very much agree with the underlying principle of which he reminds us. There is an obligation on all our generation to ensure that the younger generation has better opportunities in life. One of people’s most fundamental concerns is that opportunities for social mobility, getting started on the housing ladder and getting a good education should be at least as good for our kids as they have been for us. That is a principle that we absolutely endorse.

Opposition Members might be used to having rather embarrassing books passed under their noses—such as the memoirs of Mr Darling—but I have with me a book that need cause them no embarrassment: my book, “The Pinch”, which is on precisely this subject. I strongly recommend it to the entire Opposition Front Bench team and they should each buy a copy—they are not allowed to share it.

We support the principle of which the motion reminds us and it is a challenge to which successive Governments have had to rise. No Government can claim that they have been able fully to rise to that challenge, and Mr Denham is right to challenge the Government in the House today to recognise it, which we do, and to ask us what we are doing about it. Let me try to explain what we are doing.

Photo of Margot James Margot James Conservative, Stourbridge

My right hon. Friend is introducing our side of the argument with great generosity of spirit, but does he not agree that the tone of the motion encourages an extremely unhealthy sense of victimhood among our young people? I will not pre-empt his speech by giving a long list of all that the Government are doing for young people, but we are doing a great deal and I trust that the Minister will give full voice to all that.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

My hon. Friend is absolutely right. The debate is an opportunity for me and all Government Members to set out very clearly what we are trying to do with more apprenticeship places, 80,000 work experience places, and a funding system for universities—however controversial—that has been set up on a reliable basis for the future that will enable us to maintain the number of places to students. That adds up to more education and training places in total for young people than ever before. We are also making bold reforms on schools through free schools and the pupil premium, which will help children from low-income families, as well as through the spread of the academies programme and the arrival of university technical colleges. Going beyond education, we are also making bold reforms on housing with the new affordable homes programme bringing 170,000 new affordable homes by 2015. That all adds up to a programme that is absolutely aimed at ensuring that young people get a fair deal.

Photo of Sheila Gilmore Sheila Gilmore Labour, Edinburgh East

Will the Minister explain how properties at 80% of market value rent are affordable and how that links to his party’s declared aim of reducing spending on housing benefit?

Photo of David Willetts David Willetts Minister of State (Universities and Science)

In our affordable homes programme we have set out arrangements whereby new providers will deliver extra homes for a given amount of rental income. We aim to generate and achieve more house building as a result.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

I want to make a tiny bit more progress.

Although we are doing those very important things on higher education, skills, schools and houses, the most important single way in which we can help the younger generation is by reducing the burden of Government debt that they will have to pay for. That is at the heart of our programme. Every time the previous Government introduced some unaffordable expenditure programme paid for not out of taxes but by issuing Government bonds lasting for 25 years, they were paying for public expenditure out of burdens being placed on tomorrow’s younger generations. That is the fundamental moral failure behind the levels of debt that we inherited from the previous Labour Government.

Photo of Stella Creasy Stella Creasy Labour, Walthamstow

I am pleased to hear the Minister talk about the importance of debt levels. Will he comment on the figures from the Office for Budget Responsibility that show that directly as a result of the Government’s plans an extra £10,000 of personal debt has been loaded on to our hard-pressed households already in the past year?

Photo of David Willetts David Willetts Minister of State (Universities and Science)

Given what happened to personal debt under the previous Labour Government, about which my colleague the Secretary of State was absolutely eloquent, I do not think that Labour can be taken seriously on this subject. We are still waiting for Labour to learn from its fundamental mistake of having uncosted public expenditure programmes and irresponsible and unfunded tax reductions, but it has not learned that lesson as we can see from the motion, which is an absolute example of that. It is full of extra public expenditure promises, it has a tax cut in it and, once again, as always with Labour, the figures do not add up.

Photo of Andrew Bridgen Andrew Bridgen Conservative, North West Leicestershire

The Browne review estimated that if all new students from 2012 paid Labour’s favoured 3% graduate tax, it would not provide sufficient revenue to fund higher education until the tax year 2041-42. Will the Minister estimate how much that would add to the record budget deficit left behind by the Labour party?

Photo of David Willetts David Willetts Minister of State (Universities and Science)

My hon. Friend is absolutely right that the graduate tax favoured by the Labour leader would make the fiscal crisis that we have inherited far worse. That is one of the many objections to the idea.

Photo of Tom Blenkinsop Tom Blenkinsop Labour, Middlesbrough South and East Cleveland

Will the Minister confirm that the Chancellor’s own Office for Budget Responsibility has stated that the borrowing requirement will have to increase by £46 billion and that unemployment figures will increase by 200,000 as a result of the Chancellor’s economic strategy?

Photo of David Willetts David Willetts Minister of State (Universities and Science)

I do not know which specific OBR forecast the hon. Gentleman refers to, but the OBR work I have seen makes it clear that although there are reductions in public sector employment they are more than offset by increases in private sector employment. That is one of the many ways in which we are rebalancing the economy. We are now hearing claims to fiscal rectitude from the party that left us the largest structural deficit in the G7 and the largest level of borrowing in the developed world. Unless the Labour party gets serious about the importance of prudent management of the public finances we simply will not take seriously its commitment to caring about the interests of future generations.

Photo of David Evennett David Evennett Conservative, Bexleyheath and Crayford

My right hon. Friend, as always, is correct in saying that it is essential to repair the economy to ensure a good future for all our young people, and that if we had an economy like the one left by the last Labour Government, that future would be bleak. The Wolf report on vocational education said that a significant proportion of the 14 to 19 cohort are being offered a less effective path into employment than their predecessors. Does my right hon. Friend agree that this Government’s policies, particularly in respect of training and apprenticeships, will help address that serious problem?

Photo of David Willetts David Willetts Minister of State (Universities and Science)

My hon. Friend is absolutely right, and I should have included Alison Wolf’s excellent report on my list of the things that we were doing to try to offer a fairer deal for young people.

Photo of Geraint Davies Geraint Davies Parliamentary Assembly of the Council of Europe (Substitute Member)

Does the Secretary of State agree that sovereign debt in Ireland, Iceland, Spain, Italy, Portugal and so on is much worse than that of Britain, and the reason is that Labour left 2 million more people in jobs in Britain than we inherited in 1997? The future of keeping deficits down is jobs and growth—not stupid cuts, like those he is pushing forward with.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

The crucial difference between our economy and those that the hon. Gentleman listed is that our economy has the benefit of a credible package for bringing down the public deficit, as a result of which the markets have retained confidence in us. It is because of this Government’s economic policies that we are not facing the same risks.

Photo of John Hemming John Hemming Liberal Democrat, Birmingham, Yardley

Does it not surprise the Minister, as it surprises me, that the Opposition seem to be unconcerned about the rate of interest paid and the fact that, as a deficit goes up, the rate of interest goes up as well?

Photo of David Willetts David Willetts Minister of State (Universities and Science)

That is a very important point; indeed, I understand that with its latest debt issue the Bank of England has secured historically low—almost unprecedentedly low—interest rates, which is further evidence of the confidence that people have in our seriousness about tackling the deficit that we inherited from the previous Government.

I now want to make progress on some of the specific points in the motion that the shadow Secretary of State put before us. First, let me focus briefly on youth unemployment and those not in education, employment or training. Youth unemployment is a serious problem; it does need to be tackled, and of course we regret the fact that it now stands at 949,000, having been at 924,000 when we took office. However, as we have heard, when Labour took office it was at 664,000, and the rise in youth unemployment began long before the economic crisis hit.

The really serious question that parties on both sides of the House need to address is why, even during Labour’s boom years, youth unemployment was already starting to rise. That tells us that it is a deep-seated trend, which tells us that something has gone seriously wrong with our education and training system—it was not meeting employers’ needs.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

Just a minute; I want to make a bit more headway on this point.

There is a very similar pattern in numbers of NEETs. On the current data series starting in 2000, there were 655,000 NEETs in 2000, and when Labour left office there were 874,000. I have looked up the figures for two dates that may particularly strike the shadow Secretary of State’s memory. When he arrived as Secretary of State in the Department for Innovation, Universities and Skills, there were 835,000 NEETs. During the following two years, until he left that post, he was remorselessly harried on those figures by his Opposition spokesman. By the time he left the post, the number of NEETs had risen to 954,000; we debated that many times in the House. We had an increase of 120,000 on his own watch as the Secretary of State responsible. Actually, he got out just in time: the quarter after he left, the number went over 1 million, to hit 1.74 million. I had hoped we would hear a slightly more frank account from him of the lessons he learned about the difficulty of tackling the challenge of NEETs, drawing on his own experience.

The shadow Secretary of State went on to complain about our record, but I have to say that when in opposition we warned about Train to Gain, which we said was not a serious investment in training opportunities; about programme-led apprenticeships, which were losing contact with the jobs market; and about paper vocational qualifications being churned out that did not meet the real needs of employers. Those warnings, sadly, have proved to be correct.

Photo of Tom Blenkinsop Tom Blenkinsop Labour, Middlesbrough South and East Cleveland

I thank the Minister for giving way; he is being generous with his time. We are experiencing not only record youth unemployment, but record female unemployment. I believe that the last time that such rates were experienced was in 1988, when the Minister was last in power.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

I was not personally in power then—but absolutely, some groups are excluded from the labour market whenever times are tough, and youth unemployment and female unemployment are both aspects of that.

Photo of Stewart Jackson Stewart Jackson Conservative, Peterborough

My right hon. Friend omits to mention one of the biggest catastrophes under the last Government: the disastrous incompetence of the further education capital build programme under the Learning and Skills Council, for which the former Government have not apologised. This Government are having to pick up the pieces.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

Absolutely; my hon. Friend the Minister for Further Education, Skills and Lifelong Learning is doing an excellent job with tight resources in trying to ensure that we can make at least some improvement to the further education estate, but I want to talk about apprenticeships in particular.

Photo of Jeremy Corbyn Jeremy Corbyn Labour, Islington North

Before the Minister goes on to talk about apprenticeships, will he acknowledge that the direction of travel is entirely wrong? With many young people deterred from going to college because of the loss of education maintenance allowance and rising fees, and others deterred from going to university because of debt and rising fees, does he not think that the situation will be considerably worse in a year or two, because of the policies that he has already adopted?

Photo of David Willetts David Willetts Minister of State (Universities and Science)

Let me now turn to what we are doing to ensure that young people have more opportunities, so that the picture that the hon. Gentleman paints does not come to pass.

I should now like to make some progress and to say that one of my other regrets about the Opposition motion is that it repeats not only the economic mistakes that we associate with the Brown premiership, but the spinning techniques that we recall from the Blair premiership, and that is not an attractive combination. The worst example of that in the motion, which the shadow Secretary of State repeated in his speech, is the statement that

“the proportion of apprenticeship places for 16 to 18 year olds has decreased by 11 per cent.”.

I should like briefly to explain to the House why that statement is both strictly speaking accurate and deeply misleading.

We are talking about a nine-month period, because we have only nine months’ data for the latest year. In the first nine months of 2009-10, 92,500 apprenticeships were started for 16 to 18-year-olds out of a total of 211,000 apprenticeships, so 43% of apprenticeships went to 16 to 18-year-olds. By comparison, in the first nine months of the 2010-11 academic year, under this Government, 102,900 16 to 18-year-olds started apprenticeships—up from 92,500—out of a total number of apprenticeship starts of 326,000 in a comparable period. So we have more apprenticeships for 16 to 18-year-olds, as part of a big increase in the total number of apprenticeships. Therefore, because the rate of increase in 16-to-18 apprenticeships was not as rapid as that of other apprenticeships, 16-to-18 apprenticeships in our first nine months constitute 32% of the total number.

The shadow Secretary of State, using his knowledge and ingenuity as a former Secretary of State, constructs an argument in which, because 16-to-18 apprenticeships were previously 43% and are down to 32%, we are all supposed to regret the fact that they have fallen by 11 percentage points given the increase in total apprenticeships. If anyone wants an example of the Blairite attitude to statistics—using every trick in the book to take an increase in the number 16-to-18 apprenticeships as part of an increase in the total number of apprenticeships and to include in a motion an assertion that, somehow, there has been an 11 percentage point fall—we have just seen a case study.

If Labour Members want to be taken seriously, they must get serious not just about the economic challenge that we face, but about levelling with the country and dealing with the facts that we face in an honest way. Referring to that 11 percentage point fall shows something deep in Labour’s instincts; the electorate got completely fed up with it, and we all understand why. We are delivering more apprenticeships across the piece.

Photo of Ian Paisley Jnr Ian Paisley Jnr Shadow DUP Spokesperson (Work and Pensions), Shadow DUP Spokesperson (Environment, Food and Rural Affairs)

Perhaps the Minister can give me reasons why I should vote against the motion. There are 56,000 unemployed people in Northern Ireland; that is the jobless total. That has trebled over the past four and a half years. The Minister is telling the House that everything is going swimmingly, but I do not think that it is. What are the Government doing to get those 56,000 people out of unemployment?

Photo of David Willetts David Willetts Minister of State (Universities and Science)

I am trying to explain exactly what we are doing to deliver a significant increase in the number of apprenticeships. We initially pledged to deliver 50,000 extra apprenticeships in our first year; we believe that we have achieved more than double that—100,000 extra apprenticeship places—and there is more to come.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

I shall try to make progress. Those are real apprenticeships. The shadow Secretary of State said that they were short-term apprenticeships; let me make absolutely clear how we are financing them. We are doing so from the savings that we are making on Train to Gain, which my party in opposition and the

Liberal Democrats in opposition rightly criticised as an ineffective programme with a large amount of dead-weight. The average number of hours of training received under a Train to Gain place was 33. We are replacing that with apprenticeships, in which the minimum number of hours of training and directed learning are 280. That is what we are putting in the place of Train to Gain. For the shadow Secretary of State to complain about short-term training when we are providing real apprenticeships instead of his Train to Gain is a bit rich.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

No, I shall try to make progress. We are delivering more apprenticeship places, which I very much hope will be of value to the people of Northern Ireland, as it is to the rest of the United Kingdom. The figures are dramatic: the provisional figures for the first three quarters of the academic year 2010-11 show 330,000 apprenticeship starts—an excellent record.

Let me turn to universities, briefly. Of course, we have debated this issue many times in the House, and will doubtless do so again. I begin by accepting something that the shadow Secretary of State said, and a point that he made when he was Secretary of State. It is painful when, in the summer, one is confronted with young people who have done their best in applying for university, and have not secured a place. It is painful for them, and we recognise the work that they have put in, but in recognising the difficulties that they face, I cannot do better than repeat the words spoken by the shadow Secretary of State when he was Secretary of State and was responsible for the matter:

“In terms of student numbers, going to university has always been a competitive process…we cannot afford to fully fund every single person who might like to go to university and we never have been able to.”

That is the correct position. We have been able to continue to provide record numbers of places at university, despite all the funding pressures that we face and the need to make reductions.

The previous Government, in their final days, had a plan for 20,000 extra places, as they called them, but there was no funding attached beyond the first year. There was no money to pay for years 2 or 3 of the studentship. Incidentally, contrary to the implication in the motion and to what the shadow Secretary of State said, that was explicitly described as a one-off funding stream for one year—“extra one-off funding” were the words of the then Chancellor in the 2010 Budget. What we have done instead is provide those 10,000 places last year, and we will provide another 10,000 next year. Instead of having to reduce places, we hope to maintain broadly that number, so that at least an equivalent proportion of the cohort of 18-year-olds has a chance of getting to university.

We inherited from the previous Government a simple statement, which I shall quote from the pre-Budget report of December 2009. In their list of cuts, there was

“£600 million from higher education and science and research budgets from a combination of changes to student support within existing arrangements; efficiency savings and prioritisation across universities”.

We never knew how that £600 million-worth of cuts was to have been delivered, but it was very hard to see how we could maintain the number of university places that we have done and continue to provide high-quality education given that we inherited that commitment to a cut of £600 million. That is why we took the tough but controversial decision, rather than simply face cuts and reduce student numbers, to base university financing on student fees and loans—absolutely following the model used by the previous Government, with no payment up front. I believe, given the fiscal pressures that we face, that that is in the best interests both of universities, which will find, if anything, that they have extra cash as a result of our reforms, and of students, as it has enabled us to maintain a high level of places, and to reduce the monthly repayments facing students. The shadow Secretary of State failed to explain at any point what Labour would do.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

I shall not give way, as I am going to try to make progress, although I would welcome an intervention from the shadow Secretary of State, who could usefully clarify his position. We would like to know what Labour policy is. I have been to the House, as have my ministerial colleagues, to explain our policy, and we have heard a range of suggestions from the Labour leadership. We heard what Lord Mandelson, in his memoirs, thought that a Labour Government would have done if they had been re-elected:

“I assumed, as the Treasury did, that the outcome would have to include a significant increase in tuition fees. I felt that they would certainly have to double in order to offset the deficit-reduction measures that we too would have implemented had we won the election. The alternative would have been a disastrous contraction of higher education.”

Separately, the leader of the Labour party, Edward Miliband, said:

“I would not go ahead with the increase they’re going with. I want to have a graduate tax. Why do I want to have a graduate tax? Because I think it’s a fairer way of paying for higher education, because it says the amount you pay is related to the ability to pay”.

We have three options: recognising that fees and loans were the way to help universities out of the fiscal pressures that they faced; having a graduate tax; or having a third policy of no policy whatsoever. Once again, we are having a debate in the House called by the Opposition with no indication whatever of how they would put our universities on a solid financial footing. Governments across Europe are battling to tackle their deficits, and it is important that we hear from Labour what it would do. Instead, what we have in the motion, alongside the promises on NEETs and apprenticeships, and quotes on student places, is a reference to the £2 billion tax on bankers’ bonuses, which will pay for those policies. Let me tell the shadow Secretary of State that that tax is already paying for reversing the consumer prices index-retail prices index switch for benefits and pensions; for jobs and growth spending, which adds up to £9.5 billion; to support the cancellation of the fuel duty escalator, worth £1.7 billion; to enable the Opposition to reverse the child benefit freeze, which costs £1.3 billion; to reverse the time-limited employment and support allowance, costing £1.1 million; to enable them to reverse the working tax credit freeze for £1 billion; and to reduce the age-related payment every year, costing another £600 million. In fact, we estimate that in total, the £2 billion that the Opposition will raise from a bankers’ bonus tax will pay for £27 billion-worth of public spending increases and other tax cuts.

The right hon. Gentleman has put his bid in and it is on the list. If wants to be taken seriously as a member of Government he has to tell us how he would make the figures add up. He does not rise to that challenge. We are rising to the challenge of sorting out the mess in the nation’s finances that we inherited from the Labour Government, and we are addressing that challenge while, at the same time, doing absolutely everything that we can to ensure high-quality education and training opportunities for young people—and we are proud of the commitment that we are displaying to them.

Several hon. Members:

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Photo of Nigel Evans Nigel Evans Deputy Speaker (First Deputy Chairman of Ways and Means)

Order. Will hon. Members take their seats? A number of Members want to participate in the debate, but we have not imposed a time limit for speeches. However, if they speak for considerably longer than six minutes, many other Members will simply not be able to take part, so they should bear that in mind when they make their contributions.

Photo of Adrian Bailey Adrian Bailey Chair, Business, Innovation and Skills Committee 4:44 pm, 13th September 2011

The debate is about future generations. The prospects for the next generation will impact profoundly on not only very young people, but older people. The ability of our young people—the next generation—to get skills and jobs that form the basis of economic growth will provide the wherewithal to finance our ageing population and the policies that we need for our very young people. Although the debate focuses on a particular generation, it is crucial to the whole population.

Getting the outcome wrong will have profound consequences, socially and economically. Areas such as mine in the black country even now show the scars of the unemployment and lack of investment in education that took place in the 1980s, and the intergenerational social problems that arise from families with low levels of educational aspiration and no head of the family in full-time work. Although any Government would have needed a deficit reduction plan, a slowing economy should not in itself be a reason for cutting investment in education and training. It is education and training that will enable an economy to grow out of recession as circumstances change.

My right hon. Friend Mr Denham acknowledged that the previous Government did not get everything right, but to listen to Government Members one would think the previous Government did not get anything right. No mention has been made of the fact that the number of apprenticeships rose from 70,000 to nearly 280,000—a fourfold increase—or of the huge improvement in education and training qualifications. However, I accept that even at the end of the last Labour Government, there was still a problem.

The west midlands skills partnership, which covers the skills profile in the west midlands, acknowledged that there were 3.5 million people of working age in the west midlands but only 2.5 million jobs. That is an indication of the deep-seated problems that such areas face. The west midlands skills partnership also predicted that under Government policies there would be a net loss of a further 38,000 jobs. It said that with adequate training for people in work and young people, there was the potential to create 10,000 net jobs. If the appropriate investment is made and the required standards are achieved, that would make a substantial contribution to reducing the deficit.

We should recognise that there are deep-seated problems with training and apprenticeships that we as a Labour Government did not totally overcome, but it is legitimate to ask whether this Government’s policies will address them. One of the problems is that a huge sector of the economy consists of small businesses, many of which are so small that they find it difficult to engage with the potential that apprenticeships offer. The figures quoted by my right hon. Friend demonstrate clearly that we are not getting the number of new apprenticeships for young people to which Government policy aspires. That is backed up anecdotally by conversations that I have as Chair of the Business, Innovation and Skills Committee with businesses ranging from a boat building firm in Cornwall to black country manufacturing small and medium-sized enterprises. James Morris mentioned an apprentice in the black country. I am pleased about that, but I had a conversation with a representative of the Black Country chamber of commerce this morning who tells me that apprenticeships are not happening. All the evidence suggests that the Government have not yet cracked the problem.

Photo of Gordon Birtwistle Gordon Birtwistle Liberal Democrat, Burnley

My hon. Friend Stephen Lloyd and I have held meetings with local industrialists in our constituencies and challenged them to take on 100 apprentices in 100 days, working with the Government’s apprenticeships scheme. He has succeeded in Eastbourne and I have succeeded in Burnley. Has the hon. Gentleman taken on that challenge, and does he understand that if every Member did so, 60,000 more apprentices would be employed across the country? What effort has he made to raise the number of apprenticeships in his constituency?

Photo of Adrian Bailey Adrian Bailey Chair, Business, Innovation and Skills Committee

I congratulate the hon. Gentleman on that. I cannot comment on his constituency, but I am told that the problem in mine is that there are not enough young people aged 16 to 18 with adequate national vocational qualifications to be accepted by local companies. As representatives of our areas we need to play a role in changing that, but with the greatest respect, that will not be done by setting targets—it is interesting that those Members seem suddenly to have adopted the principle of targets—over a short period of time.

Photo of Jeremy Corbyn Jeremy Corbyn Labour, Islington North

I am glad that my hon. Friend has come on to this point. Does he share my concern that too many colleges are closing high-skill courses in carpentry, engineering and electronics in favour of others, which means that the whole industrial base of this country is declining rapidly? Intervention at college and school level is essential if we are to get the number of apprenticeships rising.

Photo of Adrian Bailey Adrian Bailey Chair, Business, Innovation and Skills Committee

My hon. Friend makes a valuable point, and that is certainly a complaint I hear from local manufacturers. I would hope that the new local enterprise partnerships could address that by involving businessmen and further education provides in policy development, but we are yet to see any benefit.

My great concern, which has been reflected in some of the comments made so far, is that the new higher education funding regime will impact on the apprenticeships market. There undoubtedly appear to be real concerns among young people about the financial consequences of going to university and, as a result, they are looking for alternative routes by which to obtain qualifications. That is not wrong in itself, as vocational qualifications could be ideal for them and for the country.

However, I have looked at some figures. Pearson Professional and Vocational Training reckons that 46% of a poll of 1,100 adults and 58% of 16 to 18-year-olds are now more likely to start an apprenticeship than they were before. Analysis shows that the number of internet searches for “apprenticeship vacancies” has increased by 425%, and the website “notgoingtouni” has seen hits soar by 150%. That is not necessarily bad, but it indicates that a cohort of young people who might have gone to university are now looking to take up apprenticeships or go into vocational training. Where will the young people who would otherwise have taken those apprenticeships go? I think that this is very likely to result in a huge surge of NEETs.

That could be combated by reinforcing the policies and structures, some of which were put in place by the Labour Government, intended to overcome young people’s concerns or resistance, and in some cases the cultural obstacles, that prevent them from going to university. The abolition of Aimhigher, which had an enormous effect in areas like my constituency, is a matter of huge concern. The role of encouraging young people from relatively low-income families or deprived backgrounds to go to university has been outsourced. The problems have become much greater and the means for dealing with them have disappeared.

Photo of Margot James Margot James Conservative, Stourbridge

Aimhigher was not without its merits, but it did not succeed in getting students from lower socio-economic groups into the more selective universities; it succeeded only so far. I also take issue with the question of what help is now going to be provided, because the whole fair access programme, which underpins the rise in tuition fees, will enable many more people from lower socio-economic groups to access university education.

Photo of Adrian Bailey Adrian Bailey Chair, Business, Innovation and Skills Committee

I agree with one element of the hon. Lady’s point, because the figures for the elite Russell group universities did not increase significantly, but let me give her some UCAS figures. Between 2003 and 2010, the number of disadvantaged people in the west midlands applying to higher education and being accepted rose by 61%, compared with 27% for people from more affluent backgrounds. Certainly within the higher education sector as a whole, there was a big improvement.

I was just coming on to the point about outsourcing and the Office for Fair Access. If OFFA is given the teeth and the funding to clamp down on universities to ensure that, as a result of their being allowed to levy the new increase in tuition fees, they carry out their function successfully, it may work, but the jury is out on that.

I could also talk about the education maintenance allowance, which was referred to earlier, because about 70% of the students in my local college of higher education receive it, but we have yet to see either the fallout from the changes to it or the potential consequences of that for encouraging young people to take up post-16 education.

I am conscious of the time, Mr Deputy Speaker, so I will not go on much longer, but I make the general point that getting young people not only into vocational training but into higher education is a complex and difficult job. What the Government have done with their cuts is to remove the infrastructure needed to encourage, and to provide the right backing for, young people in order to change the fears and attitudes that have prevented them from going into training and higher education.

We do not yet know the full consequences, but I certainly have great fears that the consequences in the 1980s—with the withdrawal of jobs, education and training from so many young people—will be lived out now. I very much fear that we could recreate the vicious cycle of intergenerational deprivation and marginality which has caused so many social problems, and which in retrospect proves so difficult to counter.

I therefore support the motion and welcome the opportunity to make these points. In the new year, my Select Committee will look at apprenticeships and, I hope, secure a more in-depth analysis of what is happening and of what the Government should do.

Several hon. Members:

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Photo of Nigel Evans Nigel Evans Deputy Speaker (First Deputy Chairman of Ways and Means)

Order. If everybody takes 14 minutes, it means that well under half the people present are going to participate, so I implore hon. Members to take note of the six-minute guidance.

Photo of Esther McVey Esther McVey Conservative, Wirral West 4:58 pm, 13th September 2011

When I became a Member, I said that one of the biggest issues facing the coalition Government was the number of young people not in work, education or training. The figure stands at almost 1 million, and in some areas of the north-west it is one in four, which equates to a huge amount of young people, with a significant amount of energy and ideology, who might not be able to do anything with their lives. Youth unemployment increased by 40% under Labour, and the number of people not working, in education or in employment rose between 2000 and 2008 under Labour, while in the rest of the world it fell. Those are the figures and that is the reality of the situation. Compounded with that, we have a global financial disaster. In addition, Labour left the country with the largest deficit in the developed world, with a rising structural deficit for the seven years before the recession.

However, I do believe that Members in all parts of the House entirely believe that opportunities for the next generation are vital. There are a couple of things that we have to do. We must learn to live within our means and learn to get the deficit down so that we do not pass on more debt to future generations and so that we do not always have to say no. When we have the money, we will be able to say yes.

Photo of Debbie Abrahams Debbie Abrahams Labour, Oldham East and Saddleworth

May I remind the hon. Lady that the UK had the second lowest debt in the G7 in 2007 and only slightly worsened its position when it was recovering in 2009? I would suggest that the flatlining of the economy due to this Government’s lack of economic policy is contributing to the poor state of affairs.

Photo of Esther McVey Esther McVey Conservative, Wirral West

I hear what the hon. Lady says, but I hope she recognises that we are paying £120 million per day on interest payments alone—not a healthy bank balance if it were mine, not that it ever would be.

One of the key things we have to do is focus on what resources we have. There must be a fundamental mind shift on what we are going to do genuinely to help young people, with honesty, truthfulness, and no false hopes or expectations being created. The Opposition are saying, “Too far, too fast”, but I would say to them, “You did too little, too late. You took your eye off the ball locally, nationally and globally, and the disconnect between the youth and what business wants expanded.”

Let me substantiate those comments. Before I came into Parliament, I set up and ran the biggest business women’s network in the north-west, with 9,000 women members. I am honorary president of WIN—Wirral Investment Network—which is for businesses in Wirral. For 10 years, I worked with school children across all platforms and all backgrounds, and wondered what their hopes and aspirations were. We believe in creating opportunities, but the question is how we are going to get there and achieve that. I spent the past three years interviewing the world’s top 100 women from top backgrounds. I asked them, “What did you manage to do and how did you manage to achieve it? What differentiated you from other people?” In helping me with those interviews, they too wanted to help the next generation of young girls in particular.

Photo of Lilian Greenwood Lilian Greenwood Opposition Assistant Whip (Commons)

Last week, my daughter, who is 14 years old and has just gone into year 10, came back from her school and told me that this year it no longer had the funding to arrange work experience for her and her classmates. How is that going to increase opportunities for young women?

Photo of Esther McVey Esther McVey Conservative, Wirral West

I find that hard to believe. I am not sure how that has happened, because under the Department for Work and Pensions we are building and taking forward the biggest programme of work experience and voluntary work.

I asked the women what they had that other people did not have, and they said that in life the great equaliser has to be character and personality traits that will lead to success in individuals, irrespective of their background, connections and schooling. They said that those key things have to come from teaching, at a young age and throughout life, determination, ambition, team playing, trustworthiness, focus, working together, and the realities of life, and that that would be the great equaliser whether someone was the daughter of a baron or a baker.

That is what I want to work on with the Government. I welcome the new university technical colleges that want to expand education and ability—hands-on and mental—and will work with kids who want to do engineering and technical jobs. In Wirral, we are hoping to get one of those for the chemical industries and the built environment. I welcome the notion of free schools and academies that will open up environments and different ways of looking at things that possibly were not there before. I welcome the introduction of the pupil premium worth £430 for every pupil on free school meals. I also welcome the national scholarship programme to help the poorest students. We are also planning 250,000 more apprenticeships than were planned under Labour, which is the biggest ever boost to apprenticeships.

Under Labour—this might be difficult for the Opposition to hear—the gap between the relative chances of poor and rich students to go to university widened, the attainment gap between those at private and comprehensive schools doubled, and in places like Wirral the wealth gap doubled. The life expectancy differential between rich and poor men is now 15 years on the Wirral peninsula. I know that we are all hoping to come together to look at opportunities for the next generation, but we have to live within our means, see what we have got, and have a fundamental mind shift to what businesses want.

I am engaging with the National Youth Theatre, which works with kids from all backgrounds to help them with their dreams, aims and aspirations, and to give them the realities of ambition, hope and desire. In every theatre production, we are saying to 1,000 kids, “You can do it, but life will be tough and it isn’t easy.”

I will finish with the country’s first ever female to set up a public limited company, Debbie Moore of Pineapple Dance Studios, who has said that “nothing good comes easy”, but that opportunities are out there for everyone, and that in times of economic hardship opportunities are still out there, but it might just be a little tougher.

The Opposition motion is flawed, inaccurate and misleading. For that reason, it needs to be opposed.

Photo of Pat Glass Pat Glass Labour, North West Durham 5:06 pm, 13th September 2011

I will focus on the reality of Government policies on the lives of our young people. The Chancellor tells us that unemployment has not increased since the 2010 election. In my constituency unemployment has doubled, and the number of young people who are unemployed has risen by 28%. Margot James, who is no longer in her place, told us that the Opposition were encouraging a culture of victimhood among young people. However, citing the 28% increase in youth unemployment in my constituency is not shroud waving; those are real young victims with real young lives that are being wasted.

The Government talk about social mobility, narrowing the attainment gap, and focusing on the vulnerable and those living in deprivation and poverty. In reality, they are presiding over a huge increase in the number of young people not in education, employment or training. They have abolished many of the policies, such as the future jobs fund and the education maintenance allowance, that had a positive impact. Although the Government say nice warm words about social mobility and narrowing the attainment gap, their policies appear to be designed directly to exclude, rather than include, these young people.

The number of young people not in education, employment or training increased by 54,000 in the last quarter of last year. That is an additional 54,000 wasted young lives. Anybody who has worked with these young people sees them not as numbers but as wasted young lives. When the figures are broken down, it is clear that the biggest proportion is made up of young people who would be classified as vulnerable, such as those with special educational needs and those living in poverty. We have not seen this level of wasted young lives, or witnessed such indifference to such a tragedy from a Government, since the 1980s.

I accept that having people who are not in education, employment or training is nothing new. We had them at the time of the last Labour Government. The difference is that we did something about it. We did not sit back complacently and just let it happen. In the period between its implementation in 2009 and its abolition in 2010, the future jobs fund reduced the NEET figure by more than 200,000—that is nearly a quarter of a million young people who were given hope and the possibility of a future.

The Government’s response to all this wasted youth and potential is apprenticeships. However, what they say and what they do are two very different things. They have scrapped the guarantee of an apprenticeship for every 16 to 18-year-old who wants one. They are manipulating the figures on apprenticeships by claiming that apprenticeships for those aged 25 and over have increased by 234%.

The Minister for Universities and Science earlier accused Labour of spinning statistics, and tried to give us a lesson on it, but this is an example of high-grade spinning: the Government have rebadged Train to Gain—in-work training for older people—as “apprenticeships”. The economy needs more proper apprenticeships for young people, not short-term courses designed for older workers simply rebranded as apprenticeships. Older workers deserve better than to be pushed on to courses that do nothing for them, but are cheap for the Government to run.

On education maintenance allowance, I have worked for many years wrestling with the dilemma of improving outcomes for poorer and more vulnerable pupils, narrowing the gap between the most advantaged and the most disadvantaged, and improving participation in further and higher education. In my view, the introduction of EMA had a greater impact on the delivery of those difficult goals than almost anything else that I have seen, but it was abolished. I think it was abolished because it was a Labour Government policy. If we can find £180 million to spend on an experiment such as university technology colleges, we can find the money for EMA.

EMA was a contract between the Government and the student. Those on EMA had better attendance and attainment than their peers, and we were beginning to make good on some of the seemingly intractable and complex issues in education, such as improving boys’ attainment, narrowing the attainment gap and raising the participation of the poorest.

The Secretary of State for Business, Innovation and Skills keeps telling us—we heard this again today—that the gap between the most advantaged and the most disadvantaged increased under the Labour, but the truth is that educational attainment for all children improved under Labour. Attainment outcomes improved more for the most advantaged, but that is because of the complex set of barriers that face the most disadvantaged. Anyone who has ever worked in that field—that probably rules out most of the Government—will say that it is easier to improve outcomes for those who are already advantaged. It is much harder to improve outcomes at the same rate for the more disadvantaged. That takes consistent hard work from teachers, high levels of resources, targeted interventions and, most importantly, commitment by the Government, which is clearly no longer there for those young people.

EMA gave a leg-up to the young people who face the biggest challenges in life. It gave them access to the best courses by providing help with travel costs, books and equipment. It became the silver bullet for many disadvantaged young people. The Secretary of State came to this House and told us repeatedly that students would go to college with or without EMA—presumably on the basis that if he told us often enough, someone, somewhere would believe him—but that is not borne out by the evidence given to the Select Committee on Education, and it is not what I hear from students in my constituency, who have seen a combination of the abolition of EMA and the tripling of tuition fees. Those together have robbed them of their shot at further and higher education. That toxic combination has produced a barrier that they simply cannot get over. That is not good for them or their families, and it is disastrous for the long-term interests of this country.

The Government say that they care about all children, and that they want to improve outcomes for all children, and yet their policies directly contradict that. Their policies are about the fragmentation of the education system in favour of those who are already advantaged. A bit of help from the pupil premium will not bridge that gap.

Government cuts are wiping out youth services across the country. At the same time, the Government are providing resources for the Prime Minister’s flagship national citizens service, which, frankly, will provide an extra six weeks’ holiday for some rich kids, at the expense of desperately needed targeted youth services for others. That favours those who are already advantaged over the disadvantaged.

Government policies and cuts in public expenditure that are effectively wiping out careers advice to school pupils favour the advantaged over the disadvantaged. The well-off can already open doors to opportunities for their children, but disadvantaged young people cannot rely on family connections to open doors for them, or to get them work experience, unpaid internships with foreign banks or similar opportunities.

The Government’s policies are disadvantaging those young people and curtailing social mobility. In the long term that makes poor economic sense. It is time for the Government to rethink their policies on young people, and to start supporting all our young people, not just some of them. It is time they stopped supporting the advantaged over the disadvantaged, and stopped wasting young lives and talents.

Photo of Robin Walker Robin Walker Conservative, Worcester 5:14 pm, 13th September 2011

Today’s debate is on a vital subject, and I have no doubt that opportunities for the next generation are dear to the hearts of every

Member. I am sure that we all come to this place motivated to ensure that opportunity is as great as possible, and I have no doubt that Members of all parties are passionate about delivering for the next generation. It is tragic, therefore, that Labour Members can only talk down the opportunities for the next generation, given that their party in government did so much to blight them with debt and economic uncertainty.

Photo of Lyn Brown Lyn Brown Opposition Whip (Commons)

Is the hon. Gentleman trying to convince the House that no young person in his constituency has talked to him about the withdrawal of the EMA and its impact on their life?

Photo of Robin Walker Robin Walker Conservative, Worcester

Absolutely not. I have met young people in my constituency and I have been to my local technical college and explained to my constituents what we are doing to replace it. The people to whom I have spoken have been satisfied with that, however, because they have understood that there will be support in the future.

It is important to consider how to create opportunities. In my maiden speech I noted that some of the steps set out in the Gracious Speech aimed to increase opportunities for young people by supporting businesses that wanted to hire, by increasing the number of apprenticeships and by pursuing vital education reforms. Since then, all three of those themes have been strengthened. In answer to a recent parliamentary question, I discovered that 38 businesses in Worcester—a significantly higher proportion than the average—have successfully registered and benefited from the national insurance holiday scheme to allow them to hire new employees, and earlier this year another parliamentary question revealed that 400 apprenticeships were started between May 2010 and the end of last year. Following the huge success of the 100 in 100 campaign, championed by my excellent local newspaper, the Worcester News, I have no doubt that there will be even more this year.

Apprenticeships are a fantastic pathway to opportunities for young people. I have no compunction about saying that the previous Government were right to start the process of building them up, and I will not pretend that all Conservative Governments in the past have given them the priority that they deserve. However, it is churlish for this Opposition motion to decry the achievements of the Government and the Minister for Further Education, Skills and Lifelong Learning in delivering more. As the Minister for Universities and Science pointed out earlier, the statistics in the motion are based on spin. I welcome the Government’s commitment to fund 360,000 apprenticeships in this financial year alone, and we should all welcome the announcement in this year’s budget of a further 50,000 apprenticeship places and the more recent announcement that the Government are beating their own ambitious targets for apprenticeship starts.

Photo of Lilian Greenwood Lilian Greenwood Opposition Assistant Whip (Commons)

Does the hon. Gentleman not share my concern that even if we do see the apprenticeships that he is talking about, if growth does not return to the economy and if the Government do not do something to stimulate that growth, those people will do their training and then have no jobs to go to?

Photo of Robin Walker Robin Walker Conservative, Worcester

I totally agree that we need to deliver economic growth. I welcome that intervention, and I will come later to that point and to some of my suggestions for delivering growth.

Just last week the Government announced plans to cut more red tape for apprenticeship providers and businesses. That will be welcomed by businesses in my constituency, which often say that it is fear of the red tape involved that discourages them from supporting the scheme. Mr Bailey made an important point about how it is a challenge to encourage small businesses to provide apprenticeships. It is a challenge that we must meet, though, and one that I am depressed to see is not mentioned in the Opposition motion. It makes no suggestions for how to deal with red tape.

Businesses in Worcester are taking on apprentices, though—businesses such as Worcester Bosch, Skills for Security, Yamazaki Mazak, Sanctuary Housing, Worcester Community Housing and Tesco. From engineering expertise through to cooking and food safety, retail and administration, young people are learning on the job, and more are doing so as a result of the Government’s determination to strengthen the apprenticeship route. Next Monday I shall host an apprenticeship fair at Worcester’s historic guildhall, to celebrate the successes that have already been achieved and to launch a new challenge for apprenticeship recruitment in the city. It will be aimed specifically at NEETs and will be a celebration of real success and a chance to create new opportunities for the next generation.

It is not through apprenticeships alone, however, that opportunities will be created. Businesses must be supported in hiring and encouraged to invest in their staff and pursue opportunities for growth. Through scrapping Labour’s jobs tax right at the start of this Parliament, the Government did exactly that. Is it enough? Of course we would all like to see more, but is it a step in the right direction? Absolutely it is. We have also supported small business through corporation tax reductions and making the small business rate relief automatic.

We should never underestimate the vital role of SMEs in providing employment and opportunities for young people. The Opposition motion makes little mention of that, but it does mention the regional growth fund, which is already backing opportunity in Worcester through its support for the plans for a Worcester technology park. Once it gets the go-ahead, this project will provide a new home for green technologies in our county and provide thousands of jobs for the next generation. In contrast to the picture of doom and gloom painted by Labour Members, this body, created by the coalition Government, is already providing valuable investment in growth and making a real difference in our communities today.

The Labour party calls for a VAT cut, and for many businesses that might seem like an attractive option, but the best way in which this Government can help business is to provide economic growth and stability. Neither will be possible, however, so long as we labour under a growing deficit and burden of debt.

Photo of Robin Walker Robin Walker Conservative, Worcester

I will not, I am afraid; I have already given way twice.

With their unfunded tax cuts, the Opposition have neither a plan nor a blueprint for growth. The coalition Government must do better. We must continue to invest in apprenticeships, and continue to ensure that a world-class higher and further education sector delivers real value and opportunity. Most of all, we must support a business-led recovery.

I would like to see more people taken out of tax, and more businesses participating in schemes such as the national insurance holiday, apprenticeships and business rate discounts. I would like to see a reform of the business rates system, to give local councils more power to provide targeted discounts and to replace the antiquated valuation system. I would also like to see a real focus on the skills needed for the next generation—but today’s negative and dispiriting Opposition motion provides none of those things. I urge the Minister, in dismissing this dismal motion, to show that the coalition Government are continuing as they started out, by supporting skills, backing business and opening opportunity for the next generation.

Photo of Chris Evans Chris Evans Labour, Islwyn 5:21 pm, 13th September 2011

I congratulate Mr Walker on manfully standing up and giving us the Tory mantra. Looking across at the Government Benches, I feel sorry for him, however. It is a pity that Government Members could not be bothered to turn up to listen to his speech. Look how empty those Benches are. They should be disgusted with themselves. How many Liberal Democrats can we count? One, two, three—I cannot see any more.

Photo of Chris Evans Chris Evans Labour, Islwyn

Has Christmas come early? Is this the pantomime season?

I come to this debate remembering the experience of the 1980s. We cannot talk about opportunities for the future without thinking about that period. I grew up in the south Wales valleys, and I remember the headmaster saying to us on our first day at school, “Some of you will bring joy to the school. A tiny minority of you will make us proud and you will go to university. An even smaller minority will get into trouble with the police and bring shame on the school. The vast majority of you are only good for factory fodder, and until that time comes, we are going to make this the happiest period of your lives.” [ Laughter. ] We can laugh at that, and we can look back and mock it, but he was putting across the poverty of ambition that we felt. We felt ignored by the Tory Government; we did not fit in with Thatcher’s economic miracle. We simply wanted one thing. Well, we wanted a few things, actually. We wanted to feel safe in our own homes, we wanted to feel secure in our jobs, and we wanted hope for the future.

But, as we have heard today from the Opposition Benches, there is no hope for the future. Education maintenance allowance has gone and tuition fees have trebled, but what do we hear from the Minister? “We can’t do anything different. It’s the deficit. It’s the only way.” I congratulate the Whips, because that is all I have heard since I came into the House: “It’s the only way; it’s the only way.” Well, if the Minister wants to find a different way, I suggest that he phone the Welsh Assembly and make an appointment with the Education Minister there, Leighton Andrews. He should then jump on the tube, go to Paddington, take the train to Cardiff and go and speak to him. He will hear how our students in Wales are paying only £3,000 in tuition fees, and how we have managed to keep the education maintenance allowance. Then let him come back here and say, “It’s the only way.” In Wales we have a Labour Government. In Wales we are delivering for young people. That is the truth.

I have been hearing about the wonderful idea of apprenticeships, but there is also a huge problem with them. I pay tribute to the companies in my constituency, including Axiom, Abingdon Carpets and Pensord, that are offering wonderful apprenticeships; those schemes will build for the future. They face a problem, however, and I think that it comes from the 1980s. Many of the candidates do not have the necessary skills, such as timekeeping or communication skills, and that puts them at a disadvantage before they start. We need to look at the education system.

Photo of Justin Tomlinson Justin Tomlinson Conservative, North Swindon

I congratulate the hon. Gentleman on his eloquent speech, but will he confirm that those very same potential apprentices were educated under a Labour Government?

Photo of Chris Evans Chris Evans Labour, Islwyn

The apprenticeship scheme was during the Labour Government, and we have a Labour Government in Wales. It is devolved. [Interruption.] Will the hon. Gentleman repeat his question?

Photo of Justin Tomlinson Justin Tomlinson Conservative, North Swindon

Is it not the case that those potential apprentices who do not have the necessary skills were educated under a Labour Government?

Photo of Chris Evans Chris Evans Labour, Islwyn

I apologise for not having caught part of the hon. Gentleman’s question. The point I am getting at is that this has been a problem that has come down through the years. Sometimes the problems have not been addressed by any Government. As my hon. Friend Mr Bailey, who is no longer in his place, said, because of the decline of the manufacturing base, a number of families had no jobs and were on benefits, as there was a benefit culture there. That permeated through the education system. We need to take action now to ensure that when apprenticeships are available, those people can go for them.

Photo of Edward Davey Edward Davey The Parliamentary Under-Secretary of State for Business, Innovation and Skills

The hon. Gentleman is making an important point, which is why the Government have introduced the access to apprenticeship schemes—to tackle that very problem.

Photo of Chris Evans Chris Evans Labour, Islwyn

I agree with that, but I am saying that it needs to go much deeper. I was talking today to a friend, Andrew Whitcombe, who is the director of skills and business development at a local college. He told me that those schemes were fine, but that more needed to be done within the education system; some sort of driving licence was needed.

Photo of Lyn Brown Lyn Brown Opposition Whip (Commons)

Does my hon. Friend agree that the biggest problem with this Government is that they take an awful lot with one hand, and give back a few pebbles with the other hand, to the people we represent? The biggest problem young people have had to face in trying to fulfil their aspirations in my constituency is the removal of their education maintenance allowance, which is not being replaced by anything of equal value. The replacement is certainly not going to provide for as many people in my constituency as EMA did. Although Conservative Members can talk about their grandiose schemes, they are not replacing what they have taken away—

Photo of Nigel Evans Nigel Evans Deputy Speaker (First Deputy Chairman of Ways and Means)

Order. Will the hon. Lady face the Chair so that the microphones can pick up her words?

Photo of Chris Evans Chris Evans Labour, Islwyn

That is the point I was trying to make. We in Wales have realised the importance of EMA, which is why we have kept it. Why have we been able to keep it? Because we have a Labour Government.

To pay off the deficit—yes, we do need enterprise and we do not want inertia, but there is a problem with the Government’s belief that people can somehow go into a shop, see some sort of product on the shelves, drink it and then all of a sudden become entrepreneurs. What we need is a fundamental overhaul of how we look at our education system. We need to make work part of our education from day to day; we need to talk about self-image and communication skills, and above all, we need to talk to people about entrepreneurship. That is the only way forward for us.

To return to the motion, I do believe we need an economic stimulus, and that could come about through a VAT cut—but we also need to look at fundamental problems in our society and try to address them.

I have kept my points short, Mr Deputy Speaker, and have spoken for only six minutes. I hope that you will remember that in future when I want to speak again.

Several hon. Members:

rose —

Photo of Nigel Evans Nigel Evans Deputy Speaker (First Deputy Chairman of Ways and Means)

Order. To make sure that everyone follows the hon. Gentleman’s excellent example, I am now going to introduce a six-minute limit so that all Back Benchers are protected.

Photo of Lorely Burt Lorely Burt Chair of the Liberal Democrat Parliamentary Party 5:28 pm, 13th September 2011

I am speaking not just as a member of this coalition Government but, like Mr Bailey, as a west midlands MP. In the west midlands, we have a youth unemployment rate of 9.6%, which is 2% higher than the UK average. There is nothing I would like more than to see young people given the opportunities that they need, but this is not a new problem. Youth unemployment in the west midlands has been running at about 2% higher than the national average since mid-2008, but is this motion the right way to deal with it?

I would say that the Opposition have failed because, once again, they have not faced up to the realities of the situation. The Government are taking the tough action needed to reduce the deficit—a deficit left to us by the Labour party. It is in that context that we have to view the motion before us.

Photo of Debbie Abrahams Debbie Abrahams Labour, Oldham East and Saddleworth

Is the hon. Lady aware that debts in the City of London in 2009 stood at 245% of gross domestic product in comparison with a public sector debt of 60%. Is it not about time that the Government acknowledged that point and made sure that they targeted their action where it belongs?

Photo of Lorely Burt Lorely Burt Chair of the Liberal Democrat Parliamentary Party

I do not think that debt is a good thing. As has been mentioned, we are spending £120 million a day paying off our debts, which means that the money cannot be used for all the things that hon. Members would like to spend it on.

It is well known that Labour’s plans for the economy would have cut £7 for every £8 that the Government are cutting.

Photo of Lorely Burt Lorely Burt Chair of the Liberal Democrat Parliamentary Party

No.

The difference, other than the £1, is that the Labour party has not had the decency to tell us where it would cut that from. The Opposition claim that it is this difference that has resulted in the number of people not in education, employment or training reaching 1 million. That is the first of many interesting recollections in the motion, so let me highlight a few stark facts: in May 1997, there were 664,000 unemployed 16 to 24-year-olds in the UK, but in May 2010 there were 924,000. After 13 years in government, the Labour party left youth unemployment 40% higher than when it took office; it was Labour Members who took us to that level.

What are the Government going to do about that? We have rolled out the Work programme across the UK. It provides flexible and tailored support that will be of real benefit to our young people, unlike many of the unsuccessful schemes operated by the previous Government. We are yet to see the initial results of the Work programme, but I am confident that it will prove more successful than the future jobs fund, which was heavily reliant on the public sector and provided little more than a smokescreen for the increasingly poor youth unemployment record. In Birmingham, 2,500 positions were created under the future jobs fund, only 50 of which were in the private sector, and evidence shows that 50% of the people who took up a placement were back on jobseeker’s allowance when their placement ended. So that is not a programme that can be deemed a success.

The motion condemns this Government for leaving 100,000 people without a university place. Labour’s collective amnesia appears to have struck again. The shadow Secretary of State seems to have forgotten that in 2009, when he was universities Minister, he imposed a strict cap on places, which led to 130,000 people missing out. In 2010, the situation got worse, because 150,000 people missed out on a place. The Labour party focused so much on the 50% target it had set that it forgot the minor detail of how it was going to pay for it. Members on the Government Benches will take no lectures on universities from Labour Members, especially as the intense focus they put on universities left other routes of education for our young people neglected.

The Government have sought to rebalance that equation. We have increased the number of apprenticeships by 100,000, smashing even our own targets. These apprenticeships will provide skills and training that allow people to progress into the job market. Not only that, they will offer more flexibility than the traditional route of education, allowing people to decide what is best for them, rather than being subjected to the conveyor-belt style of the previous Government.

The motion also, bizarrely, highlights house building and claims that the Government are responsible for the current slow-down. House building under Labour fell to its lowest level since 1946. It got so bad that Labour’s housing Minister advised our young people that it was, “Time to give up the dream of home ownership.” What kind of message is that for young people? What kind of message does it send after 13 years in government? This Government are building 170,000 affordable homes over the lifetime of this Parliament. We have established the new homes bonus and the FirstBuy scheme, and we are bringing back into use many of the 300,000 empty homes in the UK. We are taking action to help young people on to the property ladder—where the previous Government failed.

The Government have also set up the regional growth fund to boost businesses outside the south-east, and I note from the motion the Opposition’s tacit approval for the scheme. They call for more money to be spent. We, too, would like to invest more money but, as Mr Byrne admitted, there was “no money left”. At the same time as making spending commitments and opposing deficit reduction, they have called on us to cut VAT. Cutting VAT to 17.5% would require £13 billion more of spending cuts and I would be very interested to know where hon. Members feel that should come from. All the Opposition offer to pay for new homes, increased regional funding, VAT cuts and a new youth jobs fund is a bankers’ bonus tax that raises less than our bank levy and failed last time. It is economic nonsense.

This debate is about chances for our young people. We do nothing to help their chances if we do not take the difficult decisions necessary to reduce the deficit. We are investing in apprenticeships, building new homes, getting people into work and securing the long-term future of the economy. That is what this Government are doing.

Photo of Catherine McKinnell Catherine McKinnell Shadow Solicitor General 5:35 pm, 13th September 2011

There is no doubt that this is a worrying time for this and the next generation of young people. That is not just my view but that of those who see first hand the damage being done to opportunities for young people, particularly across Newcastle and the north-east.

The abolition of Labour’s education maintenance allowance came as a serious blow to thousands of young people across the north-east, yet organisations have stepped into the breach. Newcastle city council, now safely back in Labour hands, was not prepared to stand back and abandon Newcastle’s generation of young people and therefore established a new 16-to-19 bursary scheme that is helping young people who face financial hardship to stay in full-time education.

The decision to end the highly regarded Aimhigher programme recently came in for strong criticism from regional universities, which fear that greater barriers to social mobility in deprived areas will be the result. Despite what Lorely Burt has just said, I have yet to find any support for the scrapping of Labour’s future jobs fund, which helped more than 5,000 young people get a foot on the job ladder in the north-east alone, not to mention the coalition’s decision to allow universities to charge students up to £9,000 per year, with the maximum fee looking likely to be the norm, not the exception, despite the promises of Ministers.

That all adds up to a total lack of Government strategy to support young people at a time when youth unemployment has hit record levels. Some 949,000 16 to 24-year olds—more than one in five across the country—are now out of work. Over the past 12 months the north-east has seen an 18% rise in the number of jobseeker’s allowance claimants, one of the highest increases in any region by some margin. For me—and for many, I am sure—that is very alarming.

Since I was first elected to this House, I have been a passionate advocate of apprenticeships and the important role that they can play in supporting young people into the workplace. To give him his due, the Minister for Further Education, Skills and Lifelong Learning shares my passion. Indeed, I welcome his commitment to expanding the number of apprenticeship places and to build on Labour’s excellent work in government. I am seriously concerned, however, that the figures on apprenticeship places are possibly being fudged, with the number of places increasing by 234% in the past nine months, which is largely attributable to Train to Gain being rebadged.

I also believe that we need to look very carefully at the quality and types of apprenticeships that are being created because we need to ensure that they genuinely meet the needs of current and future employers and match the skills that we need for Britain’s future economy. How will the Government ensure that new apprenticeship places are additional to any new jobs created? It is no good converting existing jobs into apprenticeships just to say that a target has been reached; we need to offer genuine opportunities to young people and provide genuine support for businesses so that they embrace the apprenticeship model. Despite many local employers taking up the apprenticeship agenda with gusto, many still do not appreciate the benefits that taking on an apprentice can have for their organisation. Indeed, that concern is borne out by a recent north-east chamber of commerce report that found that companies wrongly believe that taking on an apprentice is “too expensive”, or that apprenticeships are available only in a very narrow range of sectors.

Photo of Caroline Dinenage Caroline Dinenage Conservative, Gosport

Does the hon. Lady agree that the emphasis that the Government have put on apprenticeships has been fantastic PR in the sense that people who would not previously have thought of offering them now do so? I met a chap in my constituency the other day who is a carpet cleaner and who, purely because of the Government’s emphasis on apprenticeships, suddenly had the idea of offering an apprenticeship to kids from the hardest-hit areas of my constituency. That move has been a huge success and can be credited solely to the emphasis that the Government have put on apprenticeships.

Photo of Catherine McKinnell Catherine McKinnell Shadow Solicitor General

I agree that apprenticeships need a sales job to be done on them, but there is a greater need for real action that meets the needs of businesses and the economy, and I am worried that the Government’s approach is just a PR job and does not have much substance. Having met a number of apprentices from across Newcastle who work in catering, construction and as motor technician apprentices, I have seen how beneficial they can be to businesses. I have a business apprentice in my constituency office in Lemington, who just turned 18 last week and who is genuinely invaluable to my office. I encourage all hon. Members to take on an apprentice in their office and lead the way.

Clearly, the coalition needs to do more. In these straitened economic times, the Government should use every lever in their power to increase the opportunities available to young people. They should lead the way and they could make a huge difference by using public procurement to achieve social and economic ends. They spend £220 billion a year purchasing goods and services from the private sector—from business support services to new schools and hospitals to new trains. They are the top single contractor in the UK. I introduced my Apprenticeships and Skills (Public Procurement Contracts) Bill, which is due to have its Second Reading shortly, so that all companies that win major public sector contracts give a firm commitment to create apprenticeships as part of that bid.

I am delighted that my proposal has been adopted as Labour party policy, but I am disappointed that it has received only warms words from the Minister for Further Education, Skills and Lifelong Learning. As I have said, this is not the time for warm words—it is the time for action. It is hugely disappointing that the Minister for the Cabinet Office has repeatedly rejected the idea, stating that using public procurement policy

“to stimulate the creation of more apprentices...wouldn’t be appropriate”.

I ask, “Why?” If getting the cheapest price for a contract results in long-term costs and missed opportunities for young people and for the creation of our future skills base, that is short-termism at its worst and is an irresponsible way of spending taxpayers’ money. That attitude is even more disappointing because the policy has the backing of many people and major organisations, including the Federation of Small Businesses, chambers of commerce, the Association of Colleges, many unions, the Federation of Master Builders, the Electrical Contractors Association and indeed Lord Sugar.

I urge all right hon. and hon. Members to lend their support to today’s Opposition motion, because we simply cannot take the risk of creating another lost generation of young people. We have the tools to make a difference and we have the spending power of public procurement—let us use them.

Photo of Justin Tomlinson Justin Tomlinson Conservative, North Swindon 5:42 pm, 13th September 2011

Given the time constraints I shall cover a number of topics swiftly and litter them with personal requests in the hope that the Minister will agree to every one of those requests. First, on apprentices, about which several Members have made some excellent points, I welcome the increase in numbers both for young people and for adults as I am a huge fan of apprenticeships. As a Member of

Parliament I have taken on an apprentice in my constituency office, and in my former role as a business owner I also took on an apprentice, who has gone on to have a good career.

In my constituency, we have launched a scheme with a number of local businesses called plan 500, which has sought to increase the number of opportunities for work experience and apprenticeships. I am such a huge fan of apprenticeships because they help businesses by giving them an opportunity to train and shape apprentices to their organisation’s needs. They are an affordable step for businesses that are looking to progress and they provide an excellent opportunity for those who participate in apprenticeships, often giving them far better career opportunities than traditional university graduate schemes. Having talked to local businesses and business forums in my constituency, I know that they are extremely supportive of apprenticeships.

My hon. Friend Caroline Dinenage made a point about the need to improve the perception of apprenticeships, which has continued to improve over a number of years, and rightly so. One problem is that many businesses still do not understand how easy it is to employ an apprentice or what it entails. I have mentioned this in several debates, and I shall repeat it because it is still an excellent point. All businesses receive a business rate mailer, and I call on the Government to include in it information on how to take on apprentices; it would lead to the creation of further opportunities for young people.

We should do all we can to encourage the next generation of entrepreneurs. Talking to young people, it becomes clear that they love, and are inspired by, “The Apprentice” and “Dragon’s Den.” To make a sweeping generalisation, young people have enthusiasm, drive and cheek. These are all essential ingredients needed to innovate and challenge the norm, especially in high-tech and traditional industries where new opportunities could be created.

To be proactive, I think we should encourage young enterprise schemes in schools; we should establish the network of 40,000 business mentors; we should support global enterprise week, which for all those with diary open and pen poised is 14 November; and we should tap into inspirational projects, including the excellent work of the Peter Jones Foundation and of the Premier League, which has managed to deliver enterprise activities to more than 115,000 children in just two years. Too often we actually educate people out of entrepreneurial flair. I studied business at university, and only a handful of the 300 in our year went on to set up their own business. My plea is that we just let people get on and be that next generation of business owners.

I am particularly keen to see an expansion in financial education. It is essential that we equip the next generation to understand the increasingly complex financial world, and to have the confidence to be savvy consumers. That will help young people make informed financial decisions; it will help provide them with the confidence to manage their own money; it is good for their CVs, helping improve their likelihood of securing work in a challenging market; and it encourages entrepreneurs. I hope all Members will continue to support our all-party parliamentary group on financial education for young people, which is calling for compulsory financial education in the school system.

On housing and the challenges for young people in becoming first-time buyers, I would like banks to show flexibility rather than sticking to the crude method of “timesing” income by a multiple to determine whether the young person can afford to pay a mortgage. A lot of young people are already demonstrating that they can afford a mortgage by paying rent, which is nearly always more expensive than the current mortgage. I would like banks to look a lot more carefully at the person’s credit history and disposable income to determine whether they can service a mortgage.

On student finance, we have a duty to provide information to allow young people to make the best career choice for their individual circumstances, so I welcome the setting up of an independent taskforce, led by Martin Lewis of moneysavingexpert.com, to provide clear, independent advice covering the good and, crucially, the bad of any changes. For example, the emphasis should be on the question, is university really the right option for an individual? It is good for some people, not so good for others, and we have a duty to ensure that young people make informed decisions to get them their best opportunities in life.

I was going to set out a series of observations on student finances, but I will go straight to my plea that under the new system graduates should be allowed to repay loans early. The reason that we need to do so is set out in Martin Lewis’s “mythbusters” on the seven deadly sins of not allowing early repayment. First, we encourage everyone to try to manage debt responsibly, and the policy flies in the face of that. It is unpopular; in a survey carried out on the website, 87% of people said they wanted to repay early. It penalises people for good financial management and success. For some it will mean that commercial loans are cheaper; student loans will no longer be good debt for them. It pressurises parents into stumping up so that students do not need loans; and higher repayment thresholds mean that people are in debt for longer.

I understand that the policy is being considered because we do not want to disadvantage people from challenging backgrounds; I was one of the people who benefited from a full grant. But although a young person relies on their parents when they go to university, when they graduate their destiny is in their own hands as they secure work, and if a graduate has secured a good job and has disposable income, they should not be penalised with a lifetime of debt. I urge the Government to consider that.

Photo of Jim Shannon Jim Shannon Shadow DUP Spokesperson (Health), Shadow DUP Spokesperson (Transport) 5:48 pm, 13th September 2011

I am pleased to be called to speak. The first line of the motion before us says that

“this House believes that young people face a more uncertain future” than

“their parents and their grandparents” ever did. None of us in the House could argue with that, and it is the premise on which the debate is founded—that things are not as rosy today as they were for us or our parents. I am proud to be a father and grandfather. I am also proud to represent the constituency of Strangford in Northern Ireland. I am conscious of the fact that, when young people come to me, I sometimes see desperation and anxiety about getting employment and trying to do better for themselves, and I ask myself, “How can this happen? How can we help?”

Pat Glass gave an indication of the unemployment figures for her area, and the figures for my area do not make good reading either. In July this year, 2,580 people were unemployed in my constituency. That represents 6% of the economically active population—those aged 16 to 64—and places my constituency 219th among United Kingdom constituencies. Yes, it is in the bottom third, but the number of claimants is 250 higher than last year and has increased by almost 80 in the past four months. So a clear trend is starting, and that worries me.

Many of our young people are in this bracket; they are seeking employment, improvement and opportunity. I often see young, highly qualified university graduates applying for jobs in Tesco stores. There is nothing wrong with them doing that, but they are qualified to do better. I am concerned that they are not getting better opportunities. A new Tesco store is opening in my area in October, and some 2,500 people applied for the 160 jobs on offer. There are opportunities coming through, but not enough of them. We need to ensure that opportunities are there for the future, and I believe that the debate shows how we can do that.

I recognise clearly what the Government have done and what they are trying to do, but I suggest that there should be more focus on other methods of doing things. Internships are a route being followed by increasing numbers of graduates. The Government must continue to encourage employers to invest in students and graduates by offering work experience and internships, which help them to develop valuable skills and boost their employment chances.

I welcome the individual commitment by many hon. Members to successful initiatives in their areas—that is good to see—but apprenticeships are an essential mechanism. There must be in place encouragement schemes for employers to keep on their apprentices once they are qualified. In Northern Ireland, where this is a devolved matter, the Department for Employment and Learning has a programme whereby those who hire long-term unemployed people receive a financial incentive for the first few months of the employment. It is my belief that, if we made a similar offer to those who employ people for the first time, more employers would see the benefit of taking on additional employees.

We are all too aware of the financial difficulties that most small and medium businesses face, and it is the duty of the House to understand them, while encouraging sustainable employment. The motion refers to

“a temporary VAT cut to boost consumer spending”.

There is some debate about whether that is a good idea, but I feel that it is. It would boost confidence and lift the economy, and I believe that it is important to do so. I see the benefits of that proposal.

It distresses me to hear that a great many young people are moving abroad. I know people who have moved from my area to Australia, which has a bit of an economic boom, or to New Zealand to get jobs. People who were brought up in my area and have construction skills see opportunities elsewhere and move out of the country to take them.

As has been said, there is another way if we look hard enough. The Northern Ireland Assembly has put a ceiling on tuition fees for students in Northern Ireland. Initiatives can be taken if the will-power is there. I see a major problem in relation to the brain drain. We often think that that happens when people reach a certain age, but I am concerned that we must stop our young people leaving our shores for pastures further away. The skills for life programme and further education have delivered much, but I am concerned—this terminology was used by a previous speaker—about a lost generation. I see a lost generation for my area if we are not careful in how we plan our strategy for the future. The Government are committed to doing better, but we must look at things in a different way. A business constituent has suggested that people could do voluntary community work for a few hours daily to get their benefits. They could then build that up as a CV, as well as helping the constituency.

I also welcome the part of the motion that refers to the bank bonus levy, which would have a financial benefit if we took it upon us. We must look to the future and foster a generation of workers who have had the opportunity to gain expertise and experience from their education. The reality is very different out there, and I urge the House to support the proposal, which was made with the best of intentions. Hon. Members should look on it favourably.

Photo of John Hemming John Hemming Liberal Democrat, Birmingham, Yardley 5:54 pm, 13th September 2011

Sometimes, I think that there is a tendency in politics to focus too much on trying to avoid tripping over the hurdles in front of us. We do not look at the horizon and see where we are going in the long term. Rather than focusing on the minute issues about the immediate policy and the motion—I oppose the motion and support Government policy—I should like to consider the longer-term issues.

It was rather sad to hear Chris Evans criticise factory work. For my constituents, we try to maintain work at Jaguar Land Rover. Those skilled jobs give people an opportunity in life. My view of work is that people should work to live, not live to work. If people have skilled jobs or have gone to sixth form or university, they can find a house to live in, bring up a family and go on a few holidays. They have some stability in their lives. That is a positive thing to have, and it should not be downgraded as something that society should not aim to have. Jim Shannon made the valid point that jobs in Tesco are important. I am pleased that a Tesco will soon open in Yardley and provide people with additional jobs.

Within all this, we need security. Young people need such opportunities in the first instance. Let us put aside party politics for a moment and look at what has happened over the past 20 or 30 years. Technology has improved things in one sense—obviously, we can do a lot more with fewer people—but we do not need so many people to do what we do. Mr Bailey said that there are perhaps 1 million jobs short in the west midlands. Obviously, some people are now in education who would previously have been in work. Considering 50% growth is a thought experiment; it will not suddenly magic up massive employment. We need to consider what is happening in other countries. Rather than focusing on a relatively small number of people working many hours a week, trying to put everything together so that they can afford to buy a property, perhaps our long-term aim should be that people need not necessarily work so many hours and that the work is shared out.

We have had disadvantages with the benefits system. People have been discouraged from working part time. If they work part time, they do not qualify for benefits such as tax credits and the like. I hope that the universal credit system will enable people to say, “Actually, by balancing out work and life, I don’t necessarily have to work full time.” We could then share out the work and have greater numbers of people contributing to society and fewer people being described as NEETs. I do not like using acronyms to describe people. Perhaps people’s finances might not be so good, but if more people were in work but not necessarily working so many hours, they would have a better quality of life.

Photo of Sheila Gilmore Sheila Gilmore Labour, Edinburgh East

If people work fewer than 16 hours, they do not get support from tax credits. Under the universal credit system, a ceiling will be placed on people’s incomes. They will not get out of poverty as a result of those proposals.

Photo of John Hemming John Hemming Liberal Democrat, Birmingham, Yardley

I am trying to move on from just being party political about the next few minutes’ policies. If we want to design a society—okay, I do not believe in centralised state management—we should consider our objectives. If our society is to be one in which a greater proportion of people participate in its operation, we do not need to discourage people from working only two days a week, which is what the hon. Lady was referring to. That issue needs to be looked at.

We cannot just solve things with economic growth. In practice, there are limits to the resources available for growth. As colleagues might be aware, I chair the all-party group on peak oil and gas. Putting aside climate change, there are constrains on the availability of fossil fuels and limits to the extent to which we can increase consumption. When we look at obesity in society—perhaps I am a good example—we should consider whether we need to increase consumption.

There is a wider view. We need to look critically at what we are doing in the long term. In the short term, we have to deal with the deficit; there is no question about that. If we do not, interest rates will go up, and we will end up in a situation similar to that of Greece, or various other countries that face serious financial problems. However, in the long term, our objective has to be a society in which everybody participates; in which we work to live, rather than live to work; and in which we try to involve everyone. We cannot do it with a command-economy approach, but we need to support people in doing what they can and working part time, rather than penalising them for that.

I think that I have, in less than six minutes, managed to make my point, so I leave the Floor to other hon. Members.

Photo of Geraint Davies Geraint Davies Parliamentary Assembly of the Council of Europe (Substitute Member) 6:00 pm, 13th September 2011

It is a great pleasure to follow John Hemming, but in general, we have heard a rag-bag of rubbish from Government Members today. Let us think about the big picture: accelerating globalisation; climate change; the ageing of western populations; and the emergence of developing markets, particularly in China and India, that are driving up energy prices, which makes green technologies economical.

In Europe, there is a sovereign debt crisis in the aftermath of a financial crisis, but the UK, after 13 years of Labour Government, is in a pretty strong position. As I pointed out earlier, Iceland, Ireland, Italy, Portugal and Spain are in a much worse position than Britain. Why? It is because Labour had created 2 million extra jobs since 1997. Those people are working, paying tax, and making their way.

Of course, we have a deficit, two thirds of which, as the Institute for Fiscal Studies acknowledged, was created by the bankers. The other third was due to the fact that, in the recession, we invested more than we earned, but there is no apology for that. Yesterday, the Government attempted to say, “Oh well, we’ll sort out the banking crisis,” but their remedy would take eight years. They also acknowledged that they would bail out Lehman Brothers and others, so that was no real solution.

The big choice is in deciding what the balance should be between growth and cuts to get the deficit down, and there is also the issue of timing. We have not heard much about what a growth strategy would look like. We have seen what a cuts strategy looks like; we are living that awful nightmare. What we need in a growth strategy is a strategy for indigenous growth, in which we invest in education, skills, apprenticeships, economic clusters, and an entrepreneurial culture; we have heard some reference to that. We need to build up trade links, which have been savaged by the Government’s disinvestment in regional development agencies, which means that UK Trade & Investment cannot market the UK abroad effectively and get companies to invest in Britain. We need to invest in infrastructure and, in particular, in housing, as is mentioned in the motion, to crank up the economy once again.

We need inward investment, resulting from the effective marketing of Britain—something that has been cut to the bone. We need to create economic conditions of stability and certainty, not just in Britain but across Europe and globally, to give business the confidence to invest. We need to spot the obvious fact that the emerging opportunities are in future markets, not least in China and India. What is the verdict on the Government’s efforts so far? Pretty poor, frankly. Small business is starved of cash from banks. The news of massive cuts in public services means that consumers are saving instead of consuming, so companies are not investing in new jobs. In construction, things are almost as dead as a door-nail.

On education and skills, Government Front Benchers deny that it is possible to send students to university for £3,000, yet in Wales that is precisely what is happening. A student from Wales will leave university with a debt of £10,000, but in England, it will be £30,000. If there are three children in a family, that is £100,000 in England, versus £30,000 in Wales.

Photo of John Hemming John Hemming Liberal Democrat, Birmingham, Yardley

Does the hon. Gentleman accept that Wales gets a lot more money per capita through the Barnett formula?

Photo of Geraint Davies Geraint Davies Parliamentary Assembly of the Council of Europe (Substitute Member)

That is complete rubbish. The calculation is that Wales is underpaid by £300 million. We started in the same position. This is about economic choices. There are tough choices; the choice in Wales was to cap investment in the health service. It was a tough choice, but the right choice, to invest in skills for the future and productivity to make Wales strong—

Photo of Geraint Davies Geraint Davies Parliamentary Assembly of the Council of Europe (Substitute Member)

What the hon. Gentleman is doing is making England weak.

Photo of Edward Davey Edward Davey The Parliamentary Under-Secretary of State for Business, Innovation and Skills

The hon. Gentleman and his colleague from Wales, Chris Evans, have praised the Welsh Government. Can Geraint Davies explain why the average spend per school pupil in Wales is £604 less than in England in 2010-11?

Photo of Geraint Davies Geraint Davies Parliamentary Assembly of the Council of Europe (Substitute Member)

The average spend in Wales is less, but the reality is that the Welsh Government have given an undertaking to increase that spend year on year. In fact, because the Government are cutting local authority funding by 7% a year for four years, there will be less money for education in England. What there is will be funnelled into middle-class free schools, to the cost of poorer communities. Wales will put a cap on health spending, and more money will go into education. It will have a comprehensive system in which there is more money, instead of cuts, and a system in which people are enabled to go to university. That is investing in the skills of the future.

As I have mentioned, UK Trade & Investment has historically been very effective in promoting inward investment and trade in Britain, but crucially, that relied on regional development agencies, which have been abolished. When I spoke to UKTI in Brussels, Belgium, and in Düsseldorf, the same message came back: German companies would come back with a computer platform, saying, “We want to put a factory somewhere.” Where are the RDAs to draw that down? They have been abolished. Well done, the Tories and the Liberals.

On infrastructure and construction, the Government have abolished the scheme to renew schools, which basically means that construction workers are being laid off. As for future markets, we have to look at companies such as Tata Steel near Swansea, and Airbus in north Wales. Those big consumers of energy are being penalised by the Government and their unilateral carbon pricing. The Government forget that we operate in a European market, and do not understand how the markets work at all. Those companies are part of the solution. Tata Steel has a new generation of steel, with seven layers, that generates its own heat and energy; that reduces the carbon footprint by cladding a building. Airbus has a new generation of planes that use 30% less energy. That is part of the solution, and we should be supporting, not penalising, those big employers and companies.

Let me talk about Swansea. I am proud that people in companies such as Amazon are flying the flag and saying, “Come to Swansea.” We are in the premier league, so we are a global brand. What is stopping us are the Government, who are cutting the coastguard, which undermines confidence in tourism and investment in wind farms offshore, and are stopping the electrification of the railway from Cardiff to Swansea, which would link us to the European network. We just need a helping hand so that we can keep going for success, can build on the intellectual clusters in the two universities in Swansea, can build on our team spirit in marketing Swansea, and can make our contribution to a sustainable, inclusive, growth-focused future for the rest of Britain. There is enormous opportunity for Britain to get up off the floor and fight, but it is being held down by the Tories’ and Liberals’ ineptitude.

Photo of Robert Halfon Robert Halfon Conservative, Harlow 6:07 pm, 13th September 2011

This is a very important debate. As I said in my maiden speech,

“In Essex, nearly 4,000 young people are not in employment, education or training, and Harlow is one of the worst-affected towns…If we give young people the necessary skills and training, we give them opportunities and jobs for the future.”—[Hansard, 2 June 2010; Vol. 510, c. 488.]

I went on to say that that is not just about economic efficiency; it is about social justice. That is what the debate is about—real, tangible, long-term opportunities for young people, not false hope, short-term Government programmes, or a revolving door back to benefits.

It is worth looking at the history of the past few years. In 2000, around 600,000 16 to 24-year-olds were not in employment, education or training. By 2010, the number of jobless had doubled to well over 1 million, where it remains today.

Photo of Sheila Gilmore Sheila Gilmore Labour, Edinburgh East

If we are to have a history lesson, it is perhaps pertinent to point out that the rate of youth unemployment fell during the first years of the Labour Government. The 2010 figure that all Government Members want to quote with such glee was after the recession. One must look at the whole period, and not simply take the beginning and end point and imply that the Labour Government did nothing to reduce youth unemployment.

Photo of Robert Halfon Robert Halfon Conservative, Harlow

It is interesting to hear that, because youth unemployment rose steadily over the past 10 years.

For those who call for a stimulus at all costs, such as Geraint Davies, that decade is a warning. Even during a boom, we cannot spend our way to full employment. Other factors must be taken into account. From 2001, we asked teachers to spread themselves too thinly, with too many competing priorities. Maths and English suffered, and in the past 10 years, 500,000 children left primary school unable to read or write, which is shameful.

Our business culture is flawed. In Austria and Germany, for example, one in four businesses offer apprenticeships to young people, but in England it is just one in 10. Twice as many Germans qualify to become apprentices, or gain technical skills, compared with British people. What has gone wrong in the UK for our skills levels to be so low? I accept that the previous Government, as many Opposition Members have said, were concerned about youth unemployment, but far too often the schemes that were introduced in the past 10 years worked like a hamster’s wheel: people were shifted around and around, but they did not get anywhere.

The future jobs fund, which was celebrated by Mr Denham, cost a huge amount—£6,500 per placement. As I said in an intervention, about 50% of people who took part in the scheme went on the dole. I accept that there is genuine concern in all parts of the House about young people, but some of the policies introduced by the previous Government failed to get to grips with the problem, which should have been acknowledged in the Opposition motion.

What is to be done? We must improve our schools, build up vocational education, and encourage the right climate for employers to create jobs. We are already seeing a massive expansion in academies, and free schools and simpler budget lines for colleges have been introduced. All state schools will be assessed on maths and English, and that new focus is yielding results. We must build up vocational education. As has been said, the Government are funding 100,000 sponsored work experience placements for jobless 18 to 21-year olds. All vocational training will be free at the point of access, with costs repayable only when someone earns a decent salary. As has also been said, record numbers of people are signing up for apprenticeships—real apprenticeships—and getting to work.

The flagship, I believe, will be the 24 university technical colleges, which are being driven by Lord Baker and Lord Adonis. Their vision is for new 14-to-19 apprentice schools, which will be led by employers and will be centres of excellence in manufacturing, building and engineering. That will be a conveyor belt to university and high-skilled jobs. The first round of UTCs will be announced this autumn, and Harlow college in my constituency has made a strong bid to be one of the first, specialising in building systems and the new internet media that are helping to grow our economy at the London TechHub. It is shame that the shadow Secretary of State did not mention UTCs and the advantages that they will bring.

As has been said, we must encourage the right climate for employers to create jobs. Like other hon. Members, I have employed an apprentice, and I am recruiting another one at the moment. However, one problem experienced by my apprentice is that universities did not give his NVQ the UCAS points that it deserved. Apprenticeships are much harder in many ways than A-levels, and we should recognise that in the UCAS system. Elsewhere in the Government there are initiatives to create a job-friendly climate, including the Work programme, lower taxes for lower earners, welfare reform, and cuts in small business tax and corporation tax. In the past few months, I worked with the National Union of Students and major UK firms to launch a new apprentice card, which has received strong support from my hon. Friend the Minister for Further Education, Skills and Lifelong Learning. It will give apprentices the same financial benefits as those for A-level and university students.

I congratulate Catherine McKinnell on her push for apprenticeships in public sector contracts. I urge the Government to implement that proposal, not just nationally but in local councils. I have called for that repeatedly, and I have discussed it with members of Essex council, which is taking a serious look at it.

The number of jobs available has been discussed, and I want to read something from a recent letter sent to me by Monster, the jobs company:

“In order to meet…challenges, we have identified that the problem lies, not with the availability of jobs, but the failure to match jobseekers to job vacancies.”

That is crucial: it is about information and changing the culture so that people know what jobs are available. We must make sure that the National Apprenticeship Service and other schemes work as they should. In the next few weeks, I will launch a parliamentary academy—some hon. Members will have received a letter from me about this—with Martin Bright and his charity New Deal of the Mind.

Youth unemployment is devastating, and if we can improve school and vocational training—

Several hon. Members:

rose —

Photo of Dawn Primarolo Dawn Primarolo Deputy Speaker (Second Deputy Chairman of Ways and Means)

Order. May I ask the remaining six Members who wish to speak—there were only five on my list—to resume their seats while I am speaking? We have to begin the winding-up speeches at 6.40 pm. Six Members stood up to speak, which means about four minutes each. That is the good news. The bad news is that if everyone takes longer than four minutes someone will fall off the end of the speakers list, and I am afraid that I cannot do anything about that.

Photo of Debbie Abrahams Debbie Abrahams Labour, Oldham East and Saddleworth 6:16 pm, 13th September 2011

I will be brief, Madam Deputy Speaker.

With a few notable exceptions, it is a shame that hon. Members have tended to conduct the debate on party political grounds. We are discussing the future of our young people, which is much too important for us to take that approach, so I pay tribute to the hon. Members for North Swindon (Justin Tomlinson) and for Harlow (Robert Halfon). I have grave concerns about the Government’s policies, particularly the spending cuts and what they will mean for our young people.

In my constituency, there has been a steady rise in unemployment among 16 to 24-year-olds over the past 18 months. That was not something that happened before the Government took office—there has been a consistent increase in the past 18 months, and I have looked at the figures for other constituencies, too. As for NEET statistics, the figures are reaching 20% in the north-west. In my constituency, there has been a 10% increase in unemployment in the past year. In the 1980s, when I began my working life as a community worker with unemployed young people, I saw that unemployment had a significant impact on them. We must not forget the human costs, and I remember that those young people felt abandoned and separate from a society in which they had no stake.

Esther McVey said that opportunity is open to everyone if they can find it. That is not the evidence from the OECD’s recent report, which shows that, of the 30 developed countries, the UK has one of the poorest records for social mobility, along with the US, France and Italy. Using income changes as a proxy measure for social mobility, the OECD found that a hefty wage premium was associated with growing up in a better educated household, with a corresponding penalty for being raised in a less educated family. That was particularly the case in southern European countries and the UK.

In the UK, the OECD found that 50% of the economic advantage that high-earning fathers have over low-earning fathers is passed on to their sons. By contrast, in Australia, Canada and the Nordic countries, less than 20% of the wage advantage is passed on. Analysis undertaken by the London School of Economics showed that the bigger a country’s income differences the lower its social mobility. The American dream, it seems, is just that, as the US has the lowest social mobility, followed by the UK. Again, the Nordic countries are the most socially mobile. We must look at all those factors in our policies to make sure that we live in a country in which our young people can aspire to achieve their ambitions, and in which they believe there is something for them.

Policy reform can and should remove obstacles to intergenerational social mobility and to promoting economic equality of opportunities for all, but unfortunately I see direct parallels with the policies that we endured in the 1980s. The cuts to public spending are ideologically driven, with scant regard for the human costs. The scale and pace of the cuts mean that we risk abandoning yet another generation. We have already heard about the scrapping of education maintenance allowance and the trebling of university fees, but we have not heard mention of the introduction of commercial interest rates on student loans and how that will make such loans even more off-putting for people from low-income backgrounds. In addition, the Government have done away with the future jobs fund and fudged the figures on apprenticeships.

I urge all Members to look closely at opportunities for all our young people and to support the motion.

Photo of Nicholas Dakin Nicholas Dakin Labour, Scunthorpe 6:20 pm, 13th September 2011

When young people in my Scunthorpe constituency express exasperation about how hard it is to get a job and look me in the eye and say they have no future, I feel guilty because it is our responsibility to ensure that young people have hope. It is our responsibility to ensure that our young people have a better future than their parents and their grandparents. Now, thanks to the actions of this Government, that is in jeopardy.

We all have personal experience of how motivating it is for someone to get on to a course or into a job. It is particularly motivating for young people. I know this from my 30 years’ experience in education, most recently as principal of a large open-access sixth-form college. Students would grow in confidence in their first few weeks, encouraged and enthused by teachers and others. They would be amazed at their own abilities. We would unlock their talent and release their potential.

We have all observed, I am sure, how someone loses interest in life, becomes irritable with friends and family and is in danger of sinking into idleness as a result of weeks of worklessness, and how that same person suddenly grows in stature and confidence in their first few weeks of work. Work is transformational for all of us, but particularly for our young people. At the Crosby employment bureau I was privileged to witness first hand the transformational impact of work on youngsters on the future jobs fund. From being listless and desperate, they became focused and enterprising. With the vast majority progressing on to jobs at the end of the programme, this was a real success for individuals and for society.

Figures show that one in four 18 to 24-year-olds are out of work, and that is worst for young men. Those not in education, employment or training were at a record high of 18.4% last quarter. There is a danger of significant lifelong costs of long-term youth unemployment—a generation suffering for the rest of their working lives from poor job prospects, and a return to the economic, personal and community despair of the 1980s.

The ladders of opportunity put in place by the Labour Government are being systematically kicked away by this Government. EMA, the future jobs fund and the September guarantee have all been scrapped, tuition fees have trebled and student numbers have been slashed. Add to this the chaos in the careers service, which is to be debated later, and the dismantling of youth services up and down the land, which is well documented in a Select Committee report, and one wonders why the Government have got it in for young people.

EMA was the most transformational thing I have ever seen in my professional experience. It gave young people hope. It was demonstrably clear from all the evidence that EMA impacted on their attendance, their achievement and their life chances. The fact that it has gone is extremely worrying. Among the colleges in my constituency, John Leggott college last year received £865,000 in EMA. This year it has £130,000 in bursaries. North Lindsey college last year received £1,168,000 in EMA and this year has £187,000 in bursaries. That is a real impact, and it is being felt out there.

I hope the House rallies behind the motion, recognising that although all of us have not always got it right, this is an opportunity to move forward together in line with the interests of our young people.

Photo of Toby Perkins Toby Perkins Shadow Minister (Education) 6:24 pm, 13th September 2011

We can tell that we have a Tory-led Government when we are back here again debating how a whole generation can be looking forward to so challenging a future. I was desperately disappointed by the speech from the Universities Minister. He spoke for 28 minutes today and he kept promising that he was going to get on to what he was doing for young people. I heard him say about four times, “I’m about tell you what I’m going to do for young people.” He quoted Lord Mandelson and my right hon. Friend Mr Brown, and he tried to sell us his book. Perhaps we need to buy his book to learn what his policies are, but he did not tell us anything about what the Government’s plan is to try to end the record level of youth unemployment.

The Minister told us that apprenticeships were the way forward, but he was already doing that, so there was no reason for any young person listening to the debate to leave with any confidence that we had a Government with a plan that would do something about youth unemployment. Never before have young people in our country been faced with such an economic assault on all sides. The lesson of our history is that when young people start on the dole, they stay on the dole. It is so important that we get them into the right habits of working from the moment they leave school.

We urgently need growth in our economy. The Prime Minister said last week that the country was facing a growth crisis, yet we come to a debate here about the central issue facing our country, and the Conservatives and Liberal Democrats run out of speakers a long time before the end because they have nothing left to say. We have had about five speakers in a row from the Labour Benches because Government Members have given up. They have no idea what to say about this policy area.

We could look at education maintenance allowance, at university tuition fees, as my colleagues have said, or at the Government’s decision to abolish the future jobs fund before they had even assessed its success. What has happened to all those show that we have a Government who are careless of the damage that they are doing to the next generation. Why? Because the young are dispossessed, they are less likely to vote and they pay less in taxes—but times are changing. The student demonstrations showed that young people are being politicised as never before. The number of young people who have been joining the Labour party in Chesterfield, coming forward and wanting to have their voice heard gives me great confidence about what young people will do in future.

We are facing a desperate graduate employment crisis. The public sector is not growing. We have hundreds of social work graduates out of work. It is no accident that we have a huge increase in graduate unemployment at the same time as the public sector cuts. Perhaps that is because the Government have some sort of plan for a private sector-led recovery. However, the private sector recovery is not doing all that well, as we see from examples such as Bombardier, where the Government had an opportunity to safeguard jobs in British industry but decided instead to send those jobs overseas.

In the case of Forgemasters, the Government could have taken a decision that would have put Britain at the forefront of a new industry, but instead they pulled the ladder away. We see what they have done to growth in our economy with the scrapping of the regional development agencies. In Chesterfield, when Auto Windscreens went into liquidation, more than 1,000 employees turned to the Government for help and no help was forthcoming.

The future looks bleak for graduates, but it looks even worse for those who have not had the opportunity to go to university. In the next debate we will consider the dreadful mess in the careers service. At every level we see a Government who are careless about the future for young people and who are setting young people up to fail. If they do not take action soon, there will be a wasted generation.

Photo of Tom Blenkinsop Tom Blenkinsop Labour, Middlesbrough South and East Cleveland 6:28 pm, 13th September 2011

This debate is about the ability to provide skills, work and disciplined, self-organising working communities. That in turn provides revenue in tax and safeguards pensions, services and social security, on which we all rely to support the next generation.

I draw the attention of the House to a response that I received from the Minister to a written question. I asked him:

“what assessment he has made of the potential effect on youth unemployment of the change in higher education fee arrangements in 2012.”

He replied:

“The change in the fee arrangements enables the Government to continue to finance a high number of places in higher education for students in 2012, and therefore there is expected to be no adverse impact on youth unemployment as a consequence of the change.”—[

Official Report

, 7 September 2011; Vol. 532, c. 721W.]

The poverty of that response from the Minister is surpassed only by the poverty that the Government’s policy on tuition fees will induce in areas such as mine.

Last week Bill Gross of PIMCO said that the market would look favourably on a change of the Government’s economic plans. That is because the growth forecast has repeatedly been lowered. Inflation today was 4.5% of the consumer prices index, although that is not reflected in pay increases. We have seen an increase in unemployment, massive public sector redundancies and the private sector slowing down and building up for redundancies. In manufacturing and construction purchasing managers’ index figures have declined continuously in the past few months under this Government

Middlesbrough, unfortunately, tops the league in the north-east as the area with the highest youth unemployment, with 31.6% of economically active young workers aged 16 to 24 resident in the borough out of work. It is followed by Redcar and Cleveland, two boroughs that I also represent. Across the UK as a whole, almost one in five economically active young workers aged 16 to 24 are unemployed. Around 949,000 16 to 24-year-olds are out of work, following a rise of 15,000 in the last quarter, which is approaching levels last seen in the 1980s. Overall, unemployment rose by 39,000 in the three quarters to June this year, to top almost 2.5 million. The number of jobless women benefit claimants rose by 15,600 to over half a million, the highest rate since 1996.

What is especially concerning for me, coming from an area where the mass unemployment of men from 1979 onwards led to a cultural phenomenon of long-term family unemployment, is that we are now seeing massive unemployment for women. We have not seen such unemployment rates since 1988. That has a massive cultural impact on constituencies like mine, where we have had fathers, brothers and uncles unemployed, because we will now see mothers, aunties and sisters unemployed for the long term, too, as a direct result of these policies. However, these concerns seem to be falling on deaf ears in the Government. The Office for Budget Responsibility, which was set up by the Government, knows that the Government will have to borrow £46 billion more as a result of their economic policies. That means that 200,000 more people will become unemployed, also as a result of those policies.

I suggest to the Government that their rebalancing of the economy, along with the recovery, seems to be flatlining. The latest survey data from business organisations suggest that the manufacturing revival has run out of momentum. Even as businesses complain about engineering skills shortages, the unemployment rate remains the highest in the north-east, at 10%. The fear is that the skills hoarding that we saw before is not happening. The unfortunate position we are in at the moment is that the same people are now going back on short-term working agreements that they had only recently come out of. We are returning to a period in which the economy could go either way. One suggestion that the Minister might like to make to the Chancellor is to reverse the CFP policy, please look at primary industries, such as the chemical and steel industries, and please do not put manufacturing in jeopardy from foreign competition.

Photo of Chris Williamson Chris Williamson Shadow Minister (Communities and Local Government) 6:32 pm, 13th September 2011

I want to talk briefly about the promise of Britain and how it applies in Derby, with specific reference to the rail industry. Derby is renowned for its railway heritage. We have been building trains in the city for 180 years, right back to the 19th century, but we are faced with a serious situation in which the rail industry in our country hangs in the balance. The industry has given hope and a good future to young people in the city for countless generations.

Before the general election, Members now sitting on the Government Benches said that they would review all the major rail contracts, so I assume that they looked in detail at the contracts before eventually deciding not to award the vital Thameslink line to Bombardier, which would have provided employment and security for thousands of people in my city, including young people with apprenticeships, and instead awarded it to Siemens, which will build the trains in Germany. It seems to me that Ministers have been very lax in their scrutiny of the tender specifications, because the invitation to tender clearly—

Photo of Robert Halfon Robert Halfon Conservative, Harlow

On a point of order, Madam Deputy Speaker. I thought that this debate was about opportunities for the next generation, not Bombardier railways.

Photo of Dawn Primarolo Dawn Primarolo Deputy Speaker (Second Deputy Chairman of Ways and Means)

Mr Halfon, I think that you will find that that is a matter for me, not you. Chris Williamson will return to the debate.

Photo of Chris Williamson Chris Williamson Shadow Minister (Communities and Local Government)

I am trying to make the point that denying Bombardier the opportunity to fulfil this contract denies future generations the opportunity to enjoy long-term employment in the rail industry. This is a serious situation, because we face the prospect of losing the ability to build a train ever again in this country—the country that gave the world the railways. We will never again be able to build a train because of a decision that this Government have taken. The specifications of the invitation to tender were very clear that the successful bidder must have a proven solution. Siemens does not have a proven solution. It does not have a lightweight bogie. The tender goes on to state that it should be deliverable—

Photo of Dawn Primarolo Dawn Primarolo Deputy Speaker (Second Deputy Chairman of Ways and Means)

Order. Mr Williamson, I am sure that you are illustrating a point, as you said, and mean to address the topic of the debate in your short contribution, but it would be good if you talked about that topic, rather than the tender.

Photo of Chris Williamson Chris Williamson Shadow Minister (Communities and Local Government)

I am, Madam Deputy Speaker. I am merely pointing out that the Government have not fulfilled their obligations and are thereby denying opportunities for apprenticeships for building the lightweight bogies, the carriages that will run on the Thameslink line.

There are opportunities to terminate that contract. I will not go into the detail in case you call me to order, Madam Deputy Speaker, and because I want to finish my contribution shortly. However, I must refer to what the Prime Minister said when he brought his Cabinet to Derby in March. He said:

“The point of the Cabinet today is to ask one fundamental question: what is it that we can do in government to help the economy to rebalance, to grow and for businesses to start up, to invest and employ people?”

I say to the Prime Minister and to the Government that they should honour the commitment he gave to the people of Derby and the people of this country when he brought his Cabinet there. They should give young people in my city hope for a future in the rail industry, and give our country hope that we can continue to have a rail industry long into the future. If they do not do that, I fear that people in Derby, and across the country, will be denied forever the opportunity to work building trains in the rail industry.

Photo of Sheila Gilmore Sheila Gilmore Labour, Edinburgh East 6:36 pm, 13th September 2011

I shall address first some of the points that the Minister made, yet again, at the outset of the debate, about the inter-generational issue. What he said is a complete red herring. His argument is that the problems that young people face today were caused by the previous generation stealing their children’s future. I declare an interest, as one of the baby boom generation—the younger end of it. I accept that in many ways we are a fortunate generation. We are fortunate because we are the children of the welfare state. We are the ones who benefited from the better education, the better housing and the better health. We were the children raised on the cod liver oil and that peculiar-tasting orange juice. I do not know how many Members present remember that, but it did us a great deal of good.

Government Members who are so concerned about social mobility should consider that the reason why social mobility rose for the generation who entered adulthood in the 1970s was precisely because they had those opportunities. If social mobility is held to have stalled in subsequent years, we must look at what was happening when the young people of the first decade of this century were growing up—the 1980s and early 1990s. Social mobility is a long-term matter. This is not about the selfishness of a generation, but about the way that we structure society. If we are to structure society and the economy for future generations, we must put in place the sorts of measures that benefited us.

Housing is extremely important. In Edinburgh, and I suspect in many other parts of the country, the problem is not planning, despite the planning controversy that seems to have engulfed those on the Government Benches. The problem is about money to fund affordable housing. We have outstanding planning consents for buildings that are not being built. We have regeneration schemes that have stalled after demolition has been carried out, because we cannot afford to build. We have a plan for regenerating our entire docklands area. The development framework was developed five years ago, before the recession, for 18,000 homes, but it has stalled.

How do we unlock that? We could do it by making the investment that would allow affordable homes to be built. That would help to resolve the problem of young people being unable to afford housing. It would also create jobs in the private sector, and apprenticeships, which other Members have spoken about. That is very important, and we need to put it in place. That is where the investment should be going. We need to think about that very seriously, because if we do it, there will be a future for our children.

Photo of Gareth Thomas Gareth Thomas Shadow Minister (Business, Innovation and Skills), Party Chair, Co-operative Party 6:39 pm, 13th September 2011

We have, as ever, had an interesting debate, with the first Back-Bench contribution coming from my hon. Friend Mr Bailey, who rightly raised concerns about young people being deterred from going to university.

My hon. Friends the Members for North West Durham (Pat Glass) and for Scunthorpe (Nic Dakin), in powerful speeches, rightly outlined the huge mistake that the Government have made in axing the education maintenance allowance.

My hon. Friend Chris Evans set out the stark difference between a Labour Government in Wales, committed to EMA and keeping tuition fees down, and the Government here in Westminster.

My hon. Friend Catherine McKinnell rightly raised concerns about what axing Aimhigher means for the delivery of better access to university, and again she rightly pressed Ministers to look afresh at the case she has been making for the use of public procurement to drive more apprenticeship places.

My hon. Friends the Members for Swansea West (Geraint Davies) and for Chesterfield (Toby Perkins) highlighted the absence of a clear and coherent growth strategy—a point that my right hon. Friend Mr Denham clearly highlighted in his opening remarks.

My hon. Friend Debbie Abrahams dwelt on concerns about the impact on future social mobility of the measures from the governing parties.

My hon. Friend Chris Williamson quite rightly exposed the Government’s failures on Bombardier, offering a devastating indictment of the Government’s approach to manufacturing industry and of the future opportunities for young people not only in that business but, as other Members have said, in other firms such as Sheffield Forgemasters.

My hon. Friend the Member for Middlesbrough South and East Cleveland (Tom Blenkinsop raised the fears that young people in his constituency will be deterred from going to university, and he also highlighted the growing concern about rising unemployment among women, particularly in his area.

My hon. Friend Sheila Gilmore joined in the concern about the impact on future mobility of the Government’s measures, but she also highlighted the need for more social housing funding in her constituency in particular, but also nationally.

We also heard from the hon. Members for Wirral West (Esther McVey), for Worcester (Mr Walker), for Solihull (Lorely Burt), for North Swindon (Justin Tomlinson), for Strangford (Jim Shannon), for Birmingham, Yardley (John Hemming) and for Harlow (Robert Halfon), but, apart from the hon. Member for Harlow, who joined the call from Opposition Members for a far greater effort by the Government to use public procurement to secure still more apprenticeships, we heard little from Government Members, including little sadly from the Minister for Universities and Science, Mr Willetts, who opened for the

Government, that will encourage Britain’s next generation to believe that this Administration are not playing fast and loose with their prospects.

We had no apology for the decision to treble tuition fees, no apology still for axing the future jobs fund; no apology for scrapping education maintenance allowance; no apology for an economic policy that is cutting our deficit too far, too fast; and no apology for its devastating impact on prospects for the next generation.

The Government instead claim that the impact of their deficit reduction plans will be shared, but the truth, as the Institute for Fiscal Studies revealed this week, is very different. It is the next generation in particular who are bearing the brunt of the Government’s misplaced economic plans. When almost 1 million young people are out of work and Government policies are having little or no positive impact, it is surely time for the Government to come up with a plan B. Leaving young people on the dole is a waste not just of talent but of money, because it is pushing up the benefits bill.

One would have hoped that the current generation of Conservatives had learned the lessons of the 1980s. For years back then, even when recessions were officially over, youth unemployment continued to rise, and that is why action is needed now to prevent another lost generation of young people. Thanks to Labour’s youth jobs programme, youth unemployment was falling. Now, with the future jobs fund axed, youth unemployment is rising.

We have also had to listen to the complacent assertion from Conservative and Liberal Democrat Back Benchers that trebling tuition fees will not discourage the brightest and best of the next generation from going to university. Never mind that independent analysts, such as London Economics, advisers to Lord Browne’s inquiry, or the London School of Economics’ centre for the economics of education, both predict that the numbers of those going to university will drop.

Photo of Robert Halfon Robert Halfon Conservative, Harlow

The hon. Gentleman says that youth unemployment was falling under Labour, but Office for National Statistics figures show that from 1997 to 2010 it increased by 39.2%. Will he explain that, please?

Photo of Gareth Thomas Gareth Thomas Shadow Minister (Business, Innovation and Skills), Party Chair, Co-operative Party

As my right hon. Friend the Member for Southampton, Itchen pointed out in his opening remarks, youth unemployment was actually falling under the vast majority of our period in office. Of course, there was a global recession, and youth unemployment rose during that time, but thanks to Labour’s jobs fund youth unemployment was actually coming down when we left office.

Perhaps we need also to dwell on the quality of the higher education that will be available to young people. Before the summer recess, the Minister for Universities and Science presented a White Paper that could have meant a dynamic future for universities and their students, that could have been the centre of our country’s plans to rebalance the economy and that could have helped to drive the growth of new jobs in the new industries; instead, we had little more than a Coulson-esque smoke and mirrors exercise to try to disguise the coming auction of places to the lowest bidder in order to help close the funding hole that trebling tuition fees has created in the Government’s higher education budget.

Photo of David Willetts David Willetts Minister of State (Universities and Science)

The shadow Minister attacks our higher education policies, but are the Labour Opposition committed to reversing our increase in tuition fees?

Photo of Gareth Thomas Gareth Thomas Shadow Minister (Business, Innovation and Skills), Party Chair, Co-operative Party

My right hon. Friend the Member for Southampton, Itchen set out in his opening remarks what Labour would have done had we been in office. The Minister will recognise that we have in place a detailed policy review, but there was absolutely no reason why his party needed to cut university funding by as much as it did or needed to see—as a result—university fees rise so much.

Instead, the right hon. Gentleman is taking places from universities with international reputations and seeking to auction them off to the lowest bidder. He makes much of student choice, but it will not be students who decide which universities get extra places in that auction.

The Minister, under pressure back in April, praised London Metropolitan university for keeping its fees below £9,000, but just days after his praise London Met announced that 400 courses were being closed; and in July, Carl Lygo, the chief executive of BPP, one of the new providers that the right hon. Gentleman wants to see do more, said that his institution would be forced to increase staff-student ratios as it expanded. With higher tuition fees on the one hand, and cuts in courses and worse staff-student ratios on the other, this is a Government who clearly think that such measures are a price worth paying. “And the…financial cost”—these are not my words, but those of the independent Higher Education Policy Institute

“to students and taxpayers—is likely to be considerable.”

As the Minister said in his opening remarks, the Secretary of State—in his more saintly past—railed against the levels of personal debt. Now he aspires to huge increases in the levels of debt that students face on graduation. If that were not bad enough, the Higher Education Policy Institute also found in its analysis that

“social mobility is likely to be…” a

“…victim of the Government’s plans, and the new methods of allocating resources and controlling numbers look likely to reinforce…disadvantage rather than remove it.”

The Conservative party is damaging social mobility and entrenching disadvantage. Why, who on earth could have predicted that? Almost 2,000 university nursing places and 4,000 university teacher training places have gone this coming academic year; 10,000 extra student places were axed last year by the former Chief Secretary to the Treasury, Mr Laws; and 10,000 extra places are being axed next year. Each one is an opportunity gone for the brightest and best of the next generation to fulfil their hopes and their ambitions.

The apprenticeships guarantee scheme has been axed, EMA has been ended, there is rising homelessness and we have a Government in need of a plan B. They are leaving young people with a more uncertain future than at any time in the recent past.

The Government need a serious strategy for growth; they need a plan B; the motion offers them one, and I commend it to the House.

Photo of Edward Davey Edward Davey The Parliamentary Under-Secretary of State for Business, Innovation and Skills 6:49 pm, 13th September 2011

I welcome this debate because I believe that all Members of this House came into politics with the intention of trying to ensure that the next generation has greater opportunities than the current generation. It is a debate that we need to take very seriously because there is a real problem in our country, and has been for many years, regarding opportunities for the most vulnerable and disadvantaged in our society. The UK’s performance in relation to youngsters who have never been in education, employment or training has been lamentable for many years; we have been near the bottom of the OECD table for a very long time. The youngsters who have left school, are not looking for work and are not in training are those we should most worry about because their opportunities are most scarred, and they are out of contact with the many people who could help them. If we do not give opportunities to those groups of young people, the scars will be with them for life, and it will be a big loss to our whole economy and society; we need a national mission to focus on them.

We heard passionate contributions from many Members in all parts of the House. There was a degree of consensus on apprenticeships. Catherine McKinnell and my hon. Friends the Members for Harlow, for Worcester (Mr Walker) and for North Swindon (Justin Tomlinson) talked about the important opportunities provided by the increase in apprenticeships. I was particularly impressed to hear about the apprenticeships fair being organised by my hon. Friend the Member for Worcester and the increase in apprenticeships that my hon. Friends the Members for Burnley (Gordon Birtwistle) and for Eastbourne (Stephen Lloyd) have managed to achieve in working with businesses in their areas.

There was some debate about the numbers involved. This is only the second time that I have been able to address the House on apprenticeships. The first time was towards the beginning of this Government’s time in office, when Labour Front Benchers pressed me on whether our target of 50,000 apprenticeships in our first year would be hit. I was rather nervous about responding to that, and I said that I hoped it would. I could not have told the House then that we would not just hit it but do it twice over, doubling our target with 100,000 new apprenticeships in our first year—a record that we are proud of. There is a lot of enthusiasm among workers and businesses up and down the country for our approach to apprenticeships.

There was also some debate about the quality of apprenticeships—an important issue. We aspire to ensure that the apprenticeship is the gold standard approach to vocational training. We want to ensure that in putting this investment into the apprenticeships scheme, we manage to reshape it. I have talked about the idea of access to apprenticeships to ensure that people who are unable to persuade employers to take them on have the chance to experience that learning. We also want to look at higher apprenticeships.

Photo of Gareth Thomas Gareth Thomas Shadow Minister (Business, Innovation and Skills), Party Chair, Co-operative Party

If the hon. Gentleman aspires, as he says, to high-quality apprenticeships, why is he part of a Government who have abolished the apprenticeships guarantee?

Photo of Edward Davey Edward Davey The Parliamentary Under-Secretary of State for Business, Innovation and Skills

We are doing a lot better than under the apprenticeships guarantee. The hon. Gentleman should have apologised for his motion, because, as my right hon. Friend the Minister for Universities and Science clearly showed, it does not tell the real story—the success story—about apprenticeships by suggesting that it is a negative story. The truth is that the absolute number of all apprenticeships is up, as is the absolute number of young people on apprenticeships.

I am afraid that there was some misunderstanding of that success story, despite the support for our overall policy. That is not surprising, in a way, because Labour’s record is surprisingly poor in this respect. As my hon. Friends the Members for Wirral West (Esther McVey) and for Solihull (Lorely Burt) said, under Labour youth unemployment increased by 40%, and the number of NEETs increased. One of the most surprising facts is that as the number of NEETs was increasing under the Labour Government, it was falling internationally, so we fell behind Hungary, Greece and the Slovak Republic in what we were doing for the most vulnerable young people in our society. That is not a record for Labour to be proud of.

Photo of John Denham John Denham Shadow Secretary of State for Business, Innovation and Skills

The hon. Gentleman made a big point about statistics. Does he accept that the size of the cohort of young people rose massively during the years when Labour was in power, and that that is why we are right to say that up until the recession the rate of young people not in education, training or employment fell?

Photo of Edward Davey Edward Davey The Parliamentary Under-Secretary of State for Business, Innovation and Skills

The right hon. Gentleman will not admit that the percentage of unemployed young people increased. That takes account of all the issues that he is trying to wriggle out of.

There were complaints about parts of the coalition’s policies, particularly on education maintenance allowance. We heard impassioned speeches from the hon. Members for North West Durham (Pat Glass) and for Scunthorpe (Nic Dakin); they both have a lot of knowledge in this area and I listened to them intently. The hon. Member for North West Durham said that she was particularly concerned, rightly, about the outcomes of the most disadvantaged. However, she failed to recognise that our reforms—our different approach—to EMA will mean that more resources are targeted at the most disadvantaged. The 12,000 most disadvantaged young people will get up to £1,200 in a bursary that will help them more than EMA managed to do. I am afraid that her criticism ought to be of the Labour Government.

Two of the coalition’s policies that are vital for young people did not receive the attention they deserved. The first of those is a policy that we should celebrate across this House because it was introduced by the previous Government—increasing the participation age in education and training. We had to make a difficult decision during the spending review about whether this Government would be able to find the funds to continue with that policy. It was a real challenge, but we found the money despite the problems. The shadow Secretary of State complains that we have somehow targeted young people in our policies, but nothing could be further from the truth. Despite the financial situation, we are going forward with raising the participation age in education and training to 17 in 2013 and to 18 in 2015. We should be proud of that policy. We have gone further than the previous Government did. We have increased the number of trials to ensure that the roll-out of the policy is more effective, and we have freed up local authorities to come up with new, more imaginative ways to deliver on it. These are the sorts of policies that will bring real opportunities for the most disadvantaged in our society.

Secondly, there are the reforms to vocational education that we plan to take forward following the report by Professor Alison Wolf. She shook up the cosy consensus that was allowed to develop under the previous Government and made it clear that things were not all hunky-dory and that we needed to back apprenticeships, which the Government were doing, but also, crucially, to increase the quality of vocational education and ensure that those on such courses still managed to achieve basic skills in maths and English. This Government will take forward her recommendations because we believe that that will make a real difference.

We have discovered a number of things today. We have discovered that there is agreement across the House that issues of youth unemployment and the need to increase opportunities for young people are a challenge and a problem, and have been for many years, and that many of the Government’s policies, particularly on apprenticeships, are a real way forward in tackling them. We have discovered that things got worse under the Labour Government, particularly for the most disadvantaged young people. We have discovered that, despite the rhetoric of Labour Members, this Government are determined really to do something for young people and to put social mobility at the heart of our plans to succeed where the previous Government failed.

Question put.

The House divided:

Ayes 234, Noes 297.

Division number 348

See full list of votes (From The Public Whip)

Question accordingly negatived.