I am grateful to ConservativeHome for inviting me to respond to the interesting thread on the proposals put forward by George Osborne and myself. One question is how we finance them. Earlier this year we announced a £5billion reduction in the rate of growth of public spending in 2009-2010, most of which financed our proposal to cut the tax burden on people with modest savings. But that left funds which we have put towards this package to meet a specific crisis for university leavers and apprentices in 2009-2010. Of course we must reduce the growth of spending overall but that is not a reason why we cannot also have Tory initiatives to shift money towards things we value.
Some comments ask whether there are any jobs for these people to do. In the foreword to the new 2009 CBI Education and Skills survey, Richard Lambert says ‘Science, technology, engineering and maths (STEM) skills are integral to success’ but warned the survey found ‘further evidence of the serious mismatch in demand and supply, with two thirds of businesses having difficulty recruiting stem-skills staff and a particular concern at graduate and postgraduate level.’ So there is still demand from employers but it is not being met as taught masters are being cut back as they lose research council funding.
The problem was first raised with me at a Cambridge University biotechnology centre. I have also been approached by the Universities Transport Partnership, who tell me that the decision taken by the Engineering and Physical Sciences Research Council not to fund Masters courses in the same way as in the past ‘leaves some disciplines for which Masters level education is the only source of higher education, including many transport skills, without Government support. … the withdrawal of support for Masters level education will create higher level skill shortages, or aggravate existing shortages, in many areas.’ So there is a real problem here which we are right to try to address by funding 25,000 taught masters courses in STEM subjects.
Another problem which we wanted to address faces apprentices. We need good practical alternatives for young people for whom university is not the best option – and that must certainly include apprenticeships. But apprentices get a raw deal and it is especially bad in this recession. Imagine if a university decided suddenly to close down their degree courses mid term and students were told was no course to continue and no qualification to show what they had already learned. There would be an outcry. But that is what we have been doing to our apprentices. If they are laid off by an employer in the recession they find themselves with no job, no training and no qualification. I think it is right to help these apprentices by trying to find them an alternative employer and, if that cannot be done, get them a place at college to complete their training.
This recession is proving to be particularly hard on young people. If there are 3million unemployed, at least 1.25million of them will be under 25. There will be many young people leaving university this summer unable to get a job – do we send them straight on the dole or try to add to their skills? What do we say to the young apprentice who has just lost his job and his training all in one single blow? This is not one of those Labour schemes to hide unemployment, it is an attempt to support learning and training which employers really want and young people are keen to do. Research shows that a long spell of unemployment when you are young is particularly damaging to your life chances. It makes no sense to be paying out unemployment benefits to young people when they are hungry to learn, they are trying to do the right thing and there is a real need for their skills.