CIPD warns Budget still leaves glaring gap on skills investment

UK HR body warns that Chancellor’s ‘skills revolution’ at risk of being an evolution of practices that already aren’t delivering effectively for employers or jobseekers

Responding to the Chancellor’s budget, Peter Cheese, chief executive of the CIPD, the professional body for HR and people development, said on skills investment: 
 
“There is still a glaring gap between the Government’s ambition to transition the UK to a high-skill, high-wage economy and its current policies and investment priorities.  
 
“Piecemeal interventions like those announced today are unlikely to amount to a skills revolution, more an evolution of things that already aren’t hitting the mark for many employers or jobseekers.” 
 
“There needs to be an economy-wide, joined-up strategy to encourage and enable more firms to adopt strategies where the workforce is recognised as something to be invested in and drives value, rather than a cost to be minimised. 
 
“Today’s announcements focus heavily on the supply-side and giving money to existing programmes, but it’s unclear if these initiatives deliver on what employers need or if they are creating positive work opportunities. There was also little on how the Government will incentivise and encourage employers to invest more in skills themselves. After a decade of underinvestment in skills we need employers and government to be looking not just at routes into work but in-role development too.  
 
“Increased investment in T-levels is a step towards improving technical skills but many employers simply don’t know enough about them or fully understand them. Given current pressures on businesses, there’s also concern over whether enough employers will be able to offer the work experience element.  
 
“Equally, if the Government wants to work in partnership with business to create a high-skill, high-wage economy, it must listen to business and reform the Apprenticeship Levy into a more flexible training levy. The Levy in its current form has failed on every measure, coinciding with a reduction in apprenticeship starts overall, a fall in the proportion of apprenticeships going to young people and a reduction in employer investment in training. Failure to reform the Apprenticeship Levy continues to hold back employer investment in skills at a time when this has never been more important.” 

On pay increases: 
 
“Increases to the National Living Wage and pay increases for the public sector are welcome. However, for this to be sustainable we need to fix Britain’s stubborn productivity problem. There must be more support and encouragement for businesses, and SMEs in particular, to invest in people management, skills and technology to improve productivity and create more, and better quality, high-paid jobs. 
 
“Equally, higher pay in itself isn’t enough to retain and recruit staff. Businesses must also be looking at providing sufficient training, development and progression opportunities. And now, more than ever, support people’s wellbeing and respond to people’s increased expectations for flexible working practices.”  

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