Department for Employment and Learning: Jobskills (HC 417-i) Public Accounts Committee 2 mar 2005

Evidence given by Mr Will Haire, Permanent Secretary, Mr Tom Scott, Director of Corporate Services and Ms Heather Stevens, Director of Skills and Industry, Department for Employment and Learning

Q37 Mr. Gerry Steinberg (City of Durham): I had a certain amount of sympathy for you, Mr Haire, but I am gradually losing it because I would have had a lot more respect for you if you just held your hand up and said the scheme is rubbish, to be quite honest. It is a total failure. In fact, it is one of the worst reports that I have read in the five years that I have been on this particular committee. It is a catalogue of failures - failure by your Department, failure by the training providers and failure by the individual trainees themselves. If you had held your hands up and said, "I have been copped, guv, and we are going to scrap it or do something else about it," I would have understood. For you to sit there and try to defend this is absolutely amazing. As Mr Trickett has said, you have virtually wasted half a billion pounds because if you look at the Report it says that the net employment impact of Jobskills may be as low as 14%. How can you defend that? If you had turned round to this Committee and said the scheme has been a failure, we have only got 14% of people into work and we could have done a lot better, that would have been one thing but you have not, you have tried to defend it. How can you defend that?

Mr Haire: The employment effect is the net overall impact on the economy. The growth of the economy comes from that process. It is not the number of people going into employment as such. As indicated there the skills seeker system in Scotland, which is a comparable system, has a figure of 12% in this area.

Q38 Mr. Gerry Steinberg (City of Durham): That is not brilliant. Because Scotland are useless does not mean to say you have got to be useless as well.

Mr Haire: It is the economic effect, the boost to the economy, the expansion of the economy produced by this form of training; it is not the direct number of people going into employment. As I say, the scheme has indicated the reference I made before.

Q39 Mr. Gerry Steinberg (City of Durham): You still think the scheme is successful, do you?

Mr Haire: I think the scheme does provide for young people who had not got skills before to give not only a high level of access to vocational skills but a good transition to employment, and in paragraph 1.7 of the Report the NIA notes this point and notes the general strength of the scheme in this way.

Q40 Mr. Gerry Steinberg (City of Durham): I was not going to mention this because I was not going to go down this path at all. I remember when I read the Report that it actually said these fantastic skills you are telling us these youngsters are going to get are not even the skills that are needed in Northern Ireland, if I remember. You are training them for the wrong jobs anyway. I seem to remember there were jobs in tourism and God knows what else and you do not have a training scheme that does that. So not only is it not successful but you have given them skills that really are not necessary. There are much more necessary skills wanted and you are not training them. I was not going to go down this path.

Mr Haire: That is not my reading of the Report. Two-thirds of the areas are priority areas, including hospitality and tourism, so section four on the targeting gives a good indication that we have developed skills in that area. I think we are unique in the UK in trying to choose areas of this sort. We have skilled a lot in the area of construction, in engineering where there is still strength in the Belfast area, as well as in administrative and other skills, so I think there is a strong connection there.

Q41 Mr. Gerry Steinberg (City of Durham): I was not even going to go down that path anyway so I am not going to argue with that. Perhaps some of my colleagues might take that point up. If you look at page 52, paragraph 3.35 it says: "The proportion of young people leaving the programme within 4 weeks has remained relatively constant over the life of the programme, and in the four cohort years (1999-00 to 2002-03) was running at approximately 10 per cent of total trainee starts. Overall, some 7,200 of the 83,600 young people who commenced training between 1995-96 and 2002-03 left the programme within the first four weeks." Why did they leave the programme within the first four weeks?

Mr Haire: This came from personal and other reasons and also choices and changes of what they wanted to do. As I said to the Chairman, ---

Q42 Mr. Gerry Steinberg (City of Durham): It is lot of people who change their mind.

Mr Haire: These are 16-year-olds who are experiencing jobs for the first time and undoubtedly there is a problem as they choose and decide different areas.

Q43 Mr. Gerry Steinberg (City of Durham): What do they go into if they change their minds? Those who leave after four weeks, what do they do?

Mr Haire: They come back to the careers officer who will work with them and try and see if---

Q44 Mr. Gerry Steinberg (City of Durham): That is not what the Report says, with great respect. The Report says in 3.36 that the Department does not track the destination of those who leave training within the first four weeks, so I get the impression that you do not know what they do.

Mr Haire: We do know. The careers officers are working with those young people. We have focused our careers service specifically on the 16 to 18 group.

Q45 Mr. Gerry Steinberg (City of Durham): Wait a minute, no, I am sorry, you cannot say that. You are saying that the careers officers know what they are doing. The Report says that the Department does not track the destination of those who are leaving training within the first four weeks. Are you saying this Report is wrong? Are you saying that the careers officers do know where those 7,200 youngsters have gone to?

Mr Haire: We do not have a formal tracking system where we trace them but the career officers are working with those young people.

Q46 Mr. Gerry Steinberg (City of Durham): So the Report is wrong?

Mr Haire: I am saying that ---

Q47 Mr. Gerry Steinberg (City of Durham): It is either right or it is wrong. It says the Department does not track the destination of those who leave training within the first four weeks. Just say to me, "We do not track them but the careers officers do." Is that accurate?

Mr Haire: The careers officers do.

Q48 Mr. Gerry Steinberg (City of Durham): Right, fine. How much does it cost the Department when these youngsters leave? What is the cost to the Department?

Mr Haire: I am sorry I would have to come back with a detailed note on that.

Q49 Mr. Gerry Steinberg (City of Durham): 7,200 youngsters leave this scheme within the first four weeks. That must be money down the drain?

Mr Haire: The careers officers are bringing them back into the scheme and trying to get them back and settled in that way. We have had difficulty with the churn at that stage but, as I say, with young people with no qualifications this is an issue which does happen at that stage. We clearly want to focus our careers service to help them make better progress in the area and one of the areas we have been successful with ---

Q50 Mr. Gerry Steinberg (City of Durham): Fair enough; that is a very good aim, but we have 7,200 leaving the scheme in the first four weeks, we have 3,600 who leave the scheme early because they have not got a qualification, so 50 % of those on the scheme have failed the scheme before we start. How much does that cost the taxpayer? Can I assume that a quarter of a billion pounds has been wasted?

Mr Haire: We have done some calculations. We see it at about 4% of expenditure for early leaving. Some of those will leave fairly close to the end of the scheme.

Q51 Mr. Gerry Steinberg (City of Durham): The National Audit Office can work that out and that will be given out in our report at later date. Why do so many leave the scheme? Is it because the training is useless?

Mr Haire: Undoubtedly some, according to the report, indicated that they were not happy with the training.

Q52 Mr. Gerry Steinberg (City of Durham): Why?

Mr Haire: They mentioned that in the report. The key point is that a considerable number are getting jobs. They decide that they do not wish to complete because they have already secured employment. The other point is that we have brought Key Skills into a national scheme to try and make sure that numeracy, literacy and other key areas of training are given to young people to meet industry's needs, and undoubtedly it has proved more difficult for young people to achieve those skills. We are now putting a pilot in to help them through that process but undoubtedly the figures on qualifications did go down.

Q53 Mr. Gerry Steinberg (City of Durham): The questions we are asking sound very harsh but it is all in the report. It is not as though it has been made up as we go along. On page 58 it says: "In our view, there is considerable scope to enhance the effectiveness of the overall Jobskills programme and reduce the current variability in outcomes. For example, as illustrated above in relation to the 1990-00 cohort, if the Department could have raised the performance of the less effective TOs towards the average, there would have been significant positive effects in terms of increased NVQ achievement and movement into employment." If you look at the graph you see that virtually half of the individual TOs are under-performing, or am I reading the graph wrong?

Mr Haire: Indeed the graph indicates that -----

Q54 Mr. Gerry Steinberg (City of Durham): 50% of the training organisations are either very useless or a little bit useless. Is that right?

Mr Haire: No. The inspection reports would indicate that we have a quarter of provision in which the inspectorate has said has more strengths than weaknesses.

Q55 Mr. Gerry Steinberg (City of Durham): How many training organisations have you sacked?

Mr Haire: The number of organisations involved has gone down from 87 to 75 now, largely because we have taken away vocational areas which they have under-performed in.

Q56 Mr. Gerry Steinberg (City of Durham): Have you sacked the ones that were using it as cheap labour?

Mr Haire: There is no claim that the training organisations are using this as cheap labour.

Q57 Mr. Gerry Steinberg (City of Durham): That is not what I understand. My understanding is that some of these organisations are using this as a rolling programme of cheap labour. In other words, they are getting these youngsters to come in with the idea that they are going to get training and they are actually using them as cheap labour in menial tasks.

Mr Haire: The emphasis there was that some employers, not the training organisations -----

Q58 Mr. Gerry Steinberg (City of Durham): But the training organisations are responsible for the employers because that is where they put the placements.

Mr Haire: But that is hence why we have emphasised the importance of achieving qualifications, so that they are being skilled up. Clearly that is one of the areas where we must make sure -----

Q59 Mr. Gerry Steinberg (City of Durham): Have you sacked any? How many have you sacked? How many training organisations have been given the boot?

Mr Haire: The number of our contracts has gone down to 75 organisations from 87.

Mr. Gerry Steinberg (City of Durham): So that is 12. I would suspect that 50% are not delivering the goods and you have sacked 12. I rest my case, Mr Haire.

This is an uncorrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee. Neither witnesses nor Members have had the opportunity to correct the record. The transcript is not yet an approved formal record of these proceedings.