The government says it will pump more money into training and skills development. Is Train to Gain the right channel down which it should flow?
With unemployment nudging almost two million, a global credit crunch biting hard and many experts predicting financial Armageddon, it’s clear that organisations across the whole economic spectrum are starting to feel the pinch. In previous recessions, one of the first areas to suffer was training and development.
However, some people are warning that lack of investment in this area could lead to difficulties in the long term, as such an approach compounds existing skills shortages and leaves industry even further behind if and when the economy improves.
Employment minister Siôn Simon says: “Now is the time to invest in skills. All the evidence shows that employers that continue to develop their people when business is slow are more likely to survive, and be the first to take advantage when markets start to improve again.”
Flesh on the bones
The government believes the replacement of The Learning and Skills Council (LSC) by the Skills Funding Agency (SFA) will help employers provide training during the downturn. This was first announced in July 2008, but little flesh has been put on the bones so far and, as far as most employers are concerned, the Train to Gain programme is their interface with government-backed training.
Simon says the SFA will host the new National Apprenticeships Service and the Adult Advancement and Careers Service. It will also run Train to Gain, which is putting nearly £1bn a year of funding for staff development at employers’ disposal, according to Simon.
But Train to Gain’s performance has not impressed everyone. A recent report by a Parliamentary select committee on the UK’s skills prospects called on the government to consider radical reforms to Train to Gain, as well as assess what will happen when the LSC is abolished in 2010. It wants the government to evaluate all aspects of Train to Gain and to ensure the National Audit Office – a body with teeth – audits its activities and performance.
Also, key government targets for training and skills have been missed, and employers’ body the British Chambers of Commerce (BCC) said the training system is “undoubtedly” as complicated as it was 12 months ago – a common criticism of Train to Gain.
In January 2008, skills secretary John Denham promised to work with employers and training providers to bring about a culture change by making it easier for firms to access skills funding. But, by December 2008, just 291,000 staff had achieved a Level 2 qualification through Train to Gain, falling short of the 350,000 target for 2008. Also, last year, the government conceded that the flagship skills brokerage service had under-spent by £200m.
BCC skills policy adviser John Lucas said in December that the funding system baffled employers and that confirmation in the Queen’s Speech that the LSC would be replaced by a new Skills Funding Agency showed the confusion that remained.
“The constant moving of the deckchairs is not constructive. The government should work with the existing skills system – there have been up to five reincarnations of the system over the past 11 years. Undoubtedly, the number of agencies involved is confusing still.”
Despite this it’s not all doom and gloom, and the government seems intent on pushing forward skills reforms by introducing a package of financial and practical tools to help ensure training continues for employers and individuals. Also, the LSC has launched a new package of support for small and medium-sized businesses that includes free and part-funded training courses to help ensure learning still continues during the hard times.
Real help available
Chris Banks, LSC chairman, says firms that ignore training are two-and-a-half times more likely to fail, so the new investment should make a genuine difference.
“Real help is now available for those who need it most in the current economic climate. Making sure your staff are equipped with the right skills is critical to helping your business survive these tough times. Without doubt this extra money and support for smaller businesses really could make the difference between success and failure. We urge all employers to take advantage of it,” he says.
The management programme has also been extended so that as many as 340,000 smaller employers should have access to training grants, which let staff work towards a qualification. Employers can access the funding by contacting their local Train to Gain office, which can also offer guidance on everything from leadership and management training to basic skills courses. The service will then arrange a skills broker, college or training provider to offer more detailed advice and support on accessing the appropriate type of skills development.
The BCC’s Lucas says: “It is critical that small businesses ensure they have the skills they need in place to see them through these very difficult times. Staff need highly transferable skills, which will not only benefit business but also the employee, enabling both to see through the tough times and emerge in the best possible position to drive their businesses forward.”
The government is also providing extra funding for new apprenticeships. More than £140m has been pledged to fund an extra 35,000 apprenticeships across the public and private sectors in the next 12 months. Skills secretary John Denham says the money will come on top of the £1bn already committed to apprentices and can provide a high quality route into skilled employment.
Commitment to training
“Now more than ever it is important that we give people the real help they need to get and keep jobs. This is an important initiative and is a further signal of our determination to give people the chance to get the practical training they need to get on and to help ensure the country has the skilled workers it needs to benefit from the upturn,” he explains.
Gary Miles, a training expert at Roffey Park, says a commitment to training is just as important, if not even more so when economic times are tough. He says leadership at the top of an organisation needs to be more focused when companies are looking to cut costs or even make redundancies.
“There’s always the tendency for organisations to cut back on training during a recession, but I think it has to be about thinking smarter and more flexibly around development,” he says.
The CBI’s director general Richard Lambert wants businesses and colleges to forge closer links. “The case for greater collaboration between employers and colleges is compelling – being flexible and competitive is even more important during a recession,” he says.
The government has also announced an increase in the number of career development loans available and a rise in the maximum amount that people can borrow (now up to £10,000). The loans are designed to help individuals invest in their own development at colleges, universities and training firms to gain skills that employers are looking for. Denham says that about 45,000 of the loans should be available by 2010-11, up from 15,000 this year.
“Often, in tougher times, people start to look at the options available in developing new skills or training in something new. We know that as well as being more attractive to employers, people with better skills and higher levels of training will be better prepared to take advantage of new opportunities when the upturn comes,” he adds.
Skills system too confusing, says EEF
Manufacturers’ organisation the EEF is worried that the current system of skills training is too confusing for employers.
Lee Hopley, head of economic policy at EEF, thinks progress has been too slow and that recommendations made in the Leitch Review have not been implemented quickly enough.
“There was an urgent need to step up the pace of simplification even before the economic downturn. Now, with the increased support available for retraining, there is an even greater emphasis on making the system more responsive to maintain a skilled and adaptable workforce,” he explains.
The EEF is now calling on the government to simplify the skills system and make sure the Train to Gain changes are properly communicated to businesses. It also wants to address the root causes of skills problems by developing a careers system that properly supports individuals.