Spend time on training

10th May 2002, 1:00am

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Spend time on training

https://www.tes.com/magazine/archive/spend-time-training
BUDGET 2002 was about health. Spending Review 2002 should be about education and training.

Expectations are high for a good settlement for 14 to 19s - including education maintenance allowances, expanded apprenticeships - and higher education.

Yet, budgets are important staging posts for longer-term policy developments. There is still time for a second spending review in this Parliament. It will be settled in July 2004 and cover 20056 to 20078. Spending 2004 will also dovetail nicely with manifesto-writing.

In relation to post-14 education and training, the most significant long-term signal from Budget 2002 is an expansion of adult provision outside of HE.

More specifically, there will be additional resources for adult employee training, although this should not detract from further consideration of FE student finance, adult education maintenance allowances and income contingent loans.

Budget 2002 announced an additional pound;30 million for Investors in People. It also confirmed pound;40m for the new employer training pilots targeted on adults without level 2 qualifications.

The employer training pilots will ensure free tuition and accreditation for the achievement of level 2 qualifications, and repay wage costs for employers. In return, firms must provide “paid time off” for training. The full details are set out in a joint TreasuryDepartment for Education and Skills paper - Developing Workforce Skills: Piloting a New Approach - published alongside the Budget.

If the pilots go well, rumour has it that the Chancellor might find up to pound;1bn for employee training by the time of Spending Review 2004.

Running inexpensive pilots, and then ramping up public resources is standard Treasury practice. A classic example is the Research and Development Tax Credit costing more than pound;400m for all firms.

But the critical issue is whether or not the Government is planning to introduce statutory time off for training after the next election, even if it is narrower than paid educational leave.

For employers, the prospect of pound;1bn of public support for employees without level 2 qualifications cuts little ice if linked to a statutory right to time off for training.

The issue of statutory time off is “big politics”. It goes to the heart of the debate on business burdens, especially in the context of the new rights for maternity and paternity leave, and part-time working.

Indeed, there is a strong case for arguing that the possible long-term benefits to employers of training low-qualified adults are outweighed by the short-term pressures of employee absence.

To its credit, Developing Workforce Skills accepts that the costs incurred to firms providing time off for training extend beyond wage costs. There are also other costs, especially finding temporary replacement staff.

Unfortunately, the Treasury and DFES seem incapable of offering practical solutions to employers to placate the business lobby. Perhaps they should ask the Department for Trade and Industry for help on best practice on managing employee absence and assistance from private recruitment agencies.

Yet, there is a wider issue which Whitehall must consider.

The underlying philosophy of Developing Workforce Skills is that increasing the supply of skills to the labour market will cause firms to adopt higher value-added product and service development strategies.

But this contradicts the underlying philosophy of the Downing Street Performance and Innovation Unit report on workforce development - In Demand: Adult Skills for the 21st Century - published last December. For the PIU, it is the adoption of high value-added product and service strategies which drives employer demand for training. Hence, it is business development advice rather than workforce development advice to employers which is likely to drive up employer training demand.

This suggests that additional funding for adult training to the Learning and Skills Council must go hand-in-hand with additional funding for business development to the Small Business Service and Business Links. It also suggests greater co-ordination between local Business Links and the business development units in colleges and enterprise centres in HE institutes.

Even so, the jury is out over whether Whitehall can develop a combined business and skills strategy to meet the Chancellor’s productivity challenge.

Mark Corney is director of MC Consultancy

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