Training grants for firms fail to impress

13th January 2006 at 00:00
Employers simply spent state subsidies instead of their own money, an official study says - so why is the scheme being expanded? Steve Hook reports

Most of the money spent on the Government's flagship employer training pilots has failed to generate extra training, according to a study commissioned by the Government.

Much of the money simply replaced cash firms would have spent themselves anyway, it said.

Employer training pilots (ETP) help firms provide training for staff up to level 2 (GCSE-equivalent). They got off to an unpromising start according to the research, based on the first year of the pilot scheme.

The programme, to be known as "Train to Gain", is due to be introduced nationally from April with a pound;700 million budget for the next two years.

The report said: "We do not find, across-the-board, systematic evidence that ETP had significantly increased employers' provision of, or employee engagement in, training by the end of August 2004."

Ministers are relying on targets, the details of which are still to be announced, to ensure that the national scheme is more successful than the pilots at generating extra training in the workplace.

The report, by the Institute for Fiscal Studies, suggests that only 10 to 15 per cent of the training carried out under ETP was additional to what employers would have provided anyway.

But the Learning and Skills Council, which is responsible for funding the scheme, says it will still press ahead with Train to Gain. It stresses that the survey referred only to the early stages of the pilots and that targets, combined with the activities of training "brokers" - go-betweens to link employers with colleges and training providers - will see that more money goes where it is needed. (It claims most ETP training now goes beyond what would otherwise have taken place).

The council says there will be more emphasis on subsidising the training of staff in small firms that have not previously invested in training.

In the report, John Healey, financial secretary to the Treasury, and Phil Hope, the skills minister, said Train to Gain will provide better value for money.

They said the Government will "make sure colleges who provide Train to Gain training sustain the growth in their existing mainstream-funded level 2 programmes, making Train to Gain provision truly additional".

They also promise increased "contestability" - with measures which will make it easier for training firms to get involved.

According to the IFS, much of the money spent on the pilots simply displaced companies' existing training costs, effectively giving businesses a cash hand-out.

The National Institute of Adult Continuing Education says ETP has failed to prove that it is better value for money than post-19 classes in colleges, many of which continue to be cut.

Alan Tuckett, director of NIACE, asked: "Why should public money be used to pay for training which employers should have paid for themselves?

"The effect of ETP has been to secure 11,000 more people getting qualifications than would otherwise have been the case - and 220,000 people went through the scheme - a 0.5 per cent gain.

"How do we know the employer-friendly strategy is going to work?

"What is needed is not to displace employers' investment with public investment."

Adult education places continue to be lost in colleges as they are forced to put greater emphasis on priorities such as first level 2 qualifications for adults, 16-19 education and basic skills.

The latest reports of adult cuts include scrapping of evening A-level classes at Barnsley college in South Yorkshire, 2,000 IT places going at Broxtowe college, a range of subjects including massage and electronics disappearing at City College, Norwich, and cuts in childcare support at City of Bristol college.

The LSC has been arguing that colleges should charge adults higher fees, but the Association of Colleges says that these need to be introduced slowly to give the public time to adjust to having to pay more for FE courses.

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