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Chancellor commits to building new capital but does the UK have the skills to deliver it?

  • 25 Nov 2015
 

In response to the Chancellor’s Autumn Statement, Mark Beatson, chief economist for the CIPD, the professional body for HR and people development comments: 

“The Chancellor’s statement had a strong focus on capital infrastructure but is there enough investment in the people that are necessary if we’re going to see infrastructure spending deliver higher productivity? We need better human capital just as much as we need housing, roads or research facilities.”

On skills: 

“The Chancellor wants to build the country’s future but he’s doing it without the strong foundation of workforce skills. Skills policy has largely been reduced to getting young people into university and hitting the 3 million apprenticeship target. The danger is that we will simply see an increase in lower level apprenticeships and more young people leaving university with uncertain prospects and large debts.  

“If we are to raise the skills of the nation as the Government intends, we need to raise the skills of the whole workforce.  We need businesses to invest more broadly in skills development and we need more opportunities for people to learn or re-train at any point in their working life.  This spending review is at best a modest pointer in this direction.”

On apprenticeships: 

“The Government’s target of 3 million apprenticeships is a worthy target but simply hitting that number shouldn’t be seen as the definition of success. The focus has to be on quality apprenticeships of level 3 and above in order to ensure that both young people and employers get a quality outcome. 

“The increased funding per place is welcome and should be the incentive needed for the Government to encourage and for businesses to really focus on quality apprenticeships of level 3 or above. 

“The apprenticeship levy could prove to be a double-edged sword in that the new charge of 0.5% of payroll may improve the quality of apprenticeships but it could also squeeze out training opportunities for other sections of the workforce. If we are to raise the productivity of the UK, we need to see a fundamental review of the skills policy from Government and for organisations to invest more in training and skills development for the many, not just the few.”

On Further Education: 

“It’s encouraging to see that the Further Education cuts many expected have failed to materialise. Let’s not forget thought that this is an area already struggling and in need of urgent investment. We do however welcome the new maintenance loans for part-time students and tuition fee loans for those studying higher skills in FE and post-graduates. It’s vital that those people who want to learn new skills and invest in their future have the opportunity to do so. The system still remains unbalanced though. If you’re not planning to be an apprentice or a graduate, learning and training options are still limited.”

On the public sector: 

The Office for Budget Responsibility has revised down its forecast of government jobs quite considerably.  In July, general government employment was expected to fall by over 300,000 between 2014/15 and 2020/21, now it’s 80,000.  This should make it easier to increase efficiency while maintaining service quality.  However, with the exception of HMRC and the Government Digital Service, there are few signs of the Government being prepared to make the up-front investment usually necessary to deliver service transformation. 

The planned cuts in DWP staffing and programmes for those out of work are risky. Even if the claimant count is very low, the OBR is forecasting flat unemployment so we need to maintain momentum, rather than risk set-backs.”

On childcare: 

“The Government has strongly confirmed its commitment to providing free childcare. However, while the Government has undoubtedly improved options here, its policies still make some pretty strong assumptions about how and when families want to access childcare. A personal allowance system that gives individuals greater control over their childcare options would yield a better result for those who are trying to balance family and working life. It would be good to see the Government begin a dialogue with employers, families and relevant organisations on how this could work in the future.”

On helping the social care sector cope with the introduction of the National Living Wage: 

“The announcement that local authorities will be able to charge a precept on Council Tax to help pay for the cost of social care could help care providers manage the introduction of the National Living Wage”.

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