The politics of the training market

The politics of the training market

Training has in recent years become one of the most salient issues in British politics. From the ‘enterprise culture’ of the Thatcher years emerged the new concept of the training market, and the recent establishment of the Training and Enterprise Councils (TECs). These developments are at the centre of the debate between market- and state-led approaches to training. Drawing on the theoretical methodology of major policy analysts and political scientists, The Politics of the Training Market sets the current debate in the context of changing initiatives over the past thirty years. Brendan Evans explains the policy processes and ideological assumptions underpinning recent innovations, and offers a searching and up-to-date analysis of the outcomes of both the TEC and training voucher experiments. Finally, the author reflects on the new ‘hybrid’ political forms produced by recent training policy. This highly topical book will be of interest to advanced students of the labour market in British Politics, Economics and Public Administration, and to anyone involved in the training of educators and trainers. Brendan Evans is Dean of the School of Music and Humanities, and Head of Politics at Huddersfield Polytechnic. He has written and lectured extensively on education, training and employment policy, and on the theme of contemporary political ideology.

The politics of the training market From Manpower Services Commission to Training and Enterprise Councils

Brendan Evans

London and New York

First published 1992 by Routledge 11 New Fetter Lane, London EC4P 4EE This edition published in the Taylor & Francis e-Library, 2002. Simultaneously published in the USA and Canada by Routledge a division of Routledge, Chapman and Hall, Inc. 29 West 35th Street, New York, NY 10001 © 1992 Brendan Evans All rights reserved. No part of this book may be reprinted or reproduced or utilized in any form or by any electronic, mechanical or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library ISBN 0-415-00016-5 (Print Edition) Library of Congress Cataloging in Publication Data Evans, Brendan, 1944– The politics of the training market/Brendan Evans. p. cm. Includes bibliographical references and index. 1. Occupational training – Government policy – Great Britain. 2. Manpower policy – Great Britain. 3. Great Britain. Manpower Services Commission. I. Title. HD5715.5G7E94 331.25´92´0941 – dc20 ISBN 0-203-03998-X Master e-book ISBN ISBN 0-203-19138-2 (Glassbook Format)

92-5656 CIP

Contents

Acknowledgements Introduction List of acronyms and abbreviations

vii viii xii

1

Industrial training before the MSC British training policy before 1972 The emergence of the MSC Conclusion

1 2 12 17

2

The Manpower Services Commission: 1973 to 1981 The MSC’s structure and finance The Employment Services Agency Conclusion

19 19 27 46

3

The MSC in its glory: 1981 to 1987 The management and politics of the MSC The MSC and Thatcherism Technical and Vocational Education Initiative The MSC: other initiatives MSC research unit Summary

49 50 51 60 82 87 88

4

After the MSC: from Training Commission (TC) to Training Agency (TA) 1987 to 1990 The rise and fall of the Training Commission The Adult Training Strategy (ATS) Employment Training (ET) Work-related Non-Advanced Further Education (NAFE) The Research Unit The birth of training credits Conclusion

90 90 96 105 120 122 124 126

vi

Contents

5

The rise of the training and enterprise councils (TECs) Why TECs? The White Paper Employment in the 1990s: Description and analysis The establishment of the TECs: ambiguous evidence The Calderdale and Kirklees TEC: a case study TECs: the national pattern Conclusion

6

127 127 134 147 157 167 187

The MSC, the TECs, training markets and public policy theory Summary and analysis The MSC, the TECs and the case for compulsion The Tories and the MSC: a paradox resolved Public policy theory and British training policy Training futures

189 190 201 206 211 225

Notes Suggested further reading Index

228 244 246

Acknowledgements

My grateful thanks are due to many officials of the MSC and its successor organizations for their interviews and discussions with me, as well as to the library staff at Moorfoot, Sheffield, and at the Department of Employment in London. Many others, including members of parliament, officials of interested organizations, officers of the Calderdale and Kirklees Training and Enterprise Council and local employers also gave me their valuable time. I would particularly like to express my sympathy for the family of the late Hayden Kershaw, the first chief executive of the Calderdale and Kirklees Training and Enterprise Council, who assisted me before his tragically early death. My gratitude also goes to the Polytechnic of Huddersfield; who provided some financial support in the research stages of my work, and to my wife and the rest of the family for their infinite patience and support.

Introduction

The training market is a relatively new concept, and emerged from the ‘enterprise culture’ of the 1980s. Until the early 1960s training was organized on a voluntary basis, and from 1963 until the late 1980s there was an experiment in state-led training. Whether the current training market proves permanent will become clear during the course of the 1990s, since the many critics of the employer-led approach which it embodies argue that existing policy is doomed to fail without a substantive leadership from government.1 Whatever its organization, however, it is abundantly clear that training will remain one of the primary issues of the decade. The emergence of a ‘market’ in training is recognized by one commentator who describes a rather ‘special market’ in which since 1989 the responsibility for Britain’s business and industrial training has been transferred from state institutions to employers. The ‘special’ nature of the market results from the significant input of public money, and the continuing role of the Department of Employment (DE).2 Whether or not the market strategy of employer-led training is successful, there is a clear consensus that training is of supreme importance, and that widespread training of high quality is essential for Britain’s economic survival in the aftermath of the Single European Market in 1993 and the intensification of an already competitive world economy. Training is best regarded, therefore, as a ‘valence’ political issue, in which partisan conflict is about the most effective means to the achievement of agreed ends. If the Labour Party and the Liberal Democratic Party both now generally subscribe to the free market economy, training policy is one area where they lack the Conservative government’s faith in its efficacy, and so they advocate varying degrees of compulsion and incentive through taxation and levy policies. Both Labour and the Liberal Democrats are not yet fully convinced that the experiment in training credits or vouchers, which are currently being extended from a ‘pilot’ project by a number of training and enterprise councils (TECs) to becoming a fully national system, is a total solution. Yet there is no doubt that a system of training credits

Introduction

ix

provided for individuals enhances the purely ‘market’ element in current policies. The nature of the current ‘special market’ in training, in which through the TECs employers control the dispensation of public resources in a system of ‘the private government of public money’, is best understood against the background of the history of British training. The debate between the dirigiste market and the special market approaches to training policy is unfolding not merely through an analysis of the results of policies as they emerge, but also by reference to Britain’s past experiences of voluntary, statutory and hybrid methods. The outcome of the debate may also be influenced by reference to foreign training policy ‘models’. To facilitate this debate, the book briefly explores the nature of the voluntary approach before 1963, and at greater length the two phases of a more centralist approach with the industrial training boards (ITBs) and later the Manpower Services Commission (MSC) and its successor bodies. This is followed by a substantial analysis of the emergence and development of the TEC strategy since 1989. The one certainty about the provision of training in Britain is that it always has been inadequate. Training policy has emerged in a highly piecemeal manner, despite periodic interludes of rapid change and apparent advance. The period since 1989 has been one such period with an explicit attempt to raise both the quality and quantity of vocational education and training (VET) through the creation of the network of eighty-two TECs, and the introduction of a ‘pilot’ training credits system aimed at users themselves. It is naive not to recognize, however, that there has previously been great optimism about earlier initiatives. The current ones should be ruthlessly scrutinized, therefore, as the earlier strategies which they have replaced, such as the Manpower Services Commission (MSC) and the Industrial Training Boards (ITBs) are now so widely and harshly condemned. Observers have deplored the dearth of technical training provision in Britain since at least the Paris Exhibition in 1867, at which the country first perceived the possibility of effective foreign competition. It is fashionable to blame the lack of a ‘national training culture’ for the problem, but it is also argued here that policy initiatives which fail to tackle underlying attitudinal problems (by both employers and employees) cannot succeed. Yet the tendency for some observers to emphasise cultural explanations, because of their failure to discover other causes for events, is a pitfall which should also be avoided. Policy analysts who advocate policy-formulation on the basis of systematic procedures – such as the definition of objectives and rational calculations about the means to achieve them, for example should not be dismissed, even though they diminish the cultural impediments to the implementation of effective training strategies. Anything which helps to expand the quality and quantity of training should be examined.

x

Introduction

The first chapter explores the growth of training policy in the years leading up to the MSC’s establishment, and reveals the domination of voluntaristic approaches, until the brief interlude of the ITBs in the 1960s and early 1970s. The second chapter discusses the establishment of the MSC and its early activities, the challenge to its continuation as an interventionist and tripartite body from a Conservative government committed to the ideal of the free market after 1979, and its survival to launch the New Training Initiative (NTI) in 1981. The implementation of the NTI, and an exponential growth in MSC functions from 1981 to 1987 is explored in Chapter 3, as are the plethora of schemes which emerged during that time and some of the criticisms which they provoked. The general election of 1987 marks another watershed, since the government subsequently embarked upon an aggressively ideological phase in its programme and set about diminishing the role of the organization which it had allowed to flourish. This was a period when the MSC lost functions and became first a Training Commission (TC), and, after losing its tripartite Commission, a mere Training Agency (TA) with a lack of independence, which was itself also undermined with the publication of a White Paper in December 1988. This unhappy phase, both for the organization as well as for interventionistist approaches to training policy in general, is discussed in the fourth chapter. The period from December 1988 has been dominated by the creation of a network of eighty-two TECs, and the emergence of a market in training in which employers appear to have a sovereign role. Whether this constitutes a true market, however, or merely a special market with the state exercising many forms of unacknowledged control, is considered in Chapter 5. This chapter also examines the undoubted growth in public consciousness about training issues in the last few years, and the introduction of an experiment in training credits. Chapter 5 documents these changes and attempts to evaluate the success and future prospects for the TEC initiative, and does so partly on the basis of extensive interviews with participants at both a national and local level. The concluding chapter summarizes the main arguments but is an interpretative essay in its own right. It examines training policy in its historical and comparative context, focuses particularly upon the paradox of Margaret Thatcher’s readiness to preside over the growth in the power and status of the MSC, sets training policy in a wider context of labour market and socioeconomic policy generally and speculates about the relative merits of statist, corporatist and free market strategies. Finally, and drawing upon the theoretical literature on public policy-making in Britain, the concluding chapter deals with the questions of who participates and how decisions are made. This involves consideration of the theoretical debates about policy communities and networks, and rationalism versus incrementalism. While

Introduction

xi

there will be a discussion about the normative question of what is the best policy prospect in the training field, readers are also left to form their own judgement on the basis of the evidence presented. It is also clear that ideology and culture play a decisive role in the policy preferences of individuals, and even if this was less the case in the era of rather more consensual politics of the 1950s and 1960s, it was certainly true after 1979. Advocates of the free market necessarily prefer market-based solutions, while those who veer towards ‘planning’ and a more positive theory of the state favour compulsive or statutory strategies. Those who aspire to value freedom, or who favour the policy analysis perspective, however, can themselves assess how far there is evidence to justify particular strategies. This book is relevant to those with a professional or academic interest in the areas of employment and training policy, or labour-market and manpower-planning issues. It also addresses issues of interest to political scientists and students of public policy, as well as the concerns of contemporary historians and economists.

Acronyms and abbreviations

ACAS ACC ALBSU AMA AMBs AMS APEX APL AT ATAs ATOs ATS

Advisory, Conciliation and Arbitration Service Association of County Councils Adult Literacy and Basic Skills Unit Association of Municipal Authorities area manpower boards Arbetsmarknadsstyrelsen (Swedish Labour Market Board) Association of Professional, Executive, Clerical and Computer Staff Accreditation of Prior Learning Adult Training (formerly ET) approved training agencies approved training organizations Adult Training Strategy (MSC)

BACIE BGT

British Association of Commercial and Industrial Education Business Growth Training

CALLMI CBA CBI CFEs CP CPRS CSD CTC CTCs CVPE

Computer Assisted Local Labour Market Intelligence cost–benefit analysis Confederation of British Industry colleges of further education Community Programme (MSC) Central Policy Review Staff Civil Service Department Central Training Council city technology colleges Certificate in Vocational Preparation and Education

DE DES

Department of Employment Department of Education and Science

Acronyms and abbreviations

DHSS DSS

Department of Health and Social Security (now DSS) Department of Social Security

EA EAS EETPU EHE EMS ERM ES ESA ESD ESF ET

Employment Action Enterprise Allowance Scheme Electrical, Electronic, Telecommunications and Plumbing Union Enterprise in Higher Education European Monetary System exchange rate mechanism Employment Service Employment Services Agency Employment Services Division (MSC) European Social Fund Employment Training (MSC)

FE FECs FHE FMI FT

further education further education colleges further and higher education Financial Management Information Financial Times

GNP GTCs

gross national product government training centres

HE HEIs HMI HSC

higher education higher education institutions Her Majesty’s Inspector (Education) Health and Safety Commission

IAS IiP IoD IT/ITech ITBs ITOs

Interrupted Apprenticeship Scheme Investors in People (NTTF programme) Institute of Directors information technology industrial training boards industrial training organizations

JCP JICs JTS

Job Creation Programme junior instructional centres Job Training Scheme

LABs

labour advisory bodies

xiii

xiv

Acronyms and abbreviations

LCGs LEAs LECs LLMRU LMIB LTGs

local consultancy grants local education authorities local enterprise councils Local Labour Market Research Unit Labour Market Information Board local training grants

MAs MCI MIPD MSC

managing agents Management Charter Initiative Manpower Intelligence and Planning Department (MSC) Manpower Services Commission

NAB NACRO

national advisory body National Association for the Care and Resettlement of Offenders NAFE non-advanced further education NALGO National and Local Government Officers’ Association NAO National Audit Office NATFHE National Association of Teachers in Further and Higher Education NCVO National Council of Voluntary Organizations NCVQ National Council for Vocational Qualifications NEDC National Economic Development Council NEDO National Economic Development Office NJAC National Joint Advisory Council (Ministry of Labour) NJTS New Job Training Scheme (MSC) NTI New Training Initiative NTTF National Training Task Force NUGMW National Union of General and Municipal Workers NUPE National Union of Public Employees NVQ National Vocational Qualifications OMSC

Office of the Manpower Services Commission

PAR PCFC PER PICs

policy analysis and review Polytechnics and Colleges Funding Council Professional and Executive Recruitment (MSC agency) private industry councils

quango

quasi-autonomous non-governmental organization

RICs

residential instruction centres

Acronyms and abbreviations

RMIU RMSDs RSG

Regional Manpower Intelligence Unit (MSC) regional manpower service directors rate support grant

SPD STEP

Special Programmes Division (MSC) Special Temporary Employment Programme

TA TAs TAPs TC TECs TEED TFE TGWU TIAS TMs TOs TOPS TSA TSAS TSD TUC TVEI

training agency training agents training access points training commission training and enterprise councils Training, Enterprise and Employment Division (DE) Training for Enterprise Transport and General Workers Union Training within Industry Advisory Service training managers training officers Training Opportunities Scheme Training Services Agency Training Standards Advisory Service Training Services Division (MSC) Trades Union Congress Technical and Vocational Education Initiative

UCATT USDAW

Union of Construction, Allied Trades and Technicians Union of Shop, Distributive, and Allied Workers

VET

vocational education and training

WEP WOTP WOW WRFE

Work Experience Programme Wider Opportunities Training Programme Wider Opportunities for Women work-related further education

YOPS YT YTB YTS

Youth Opportunities Scheme youth training Youth Training Board Youth Training Scheme

xv

1

Industrial training before the MSC

Industrial training in Britain has always been inadequate for the nation’s needs. The creation of the MSC in 1973 did little to alter this reality, but it resulted from the perceived failure of the Industrial Training Act of 1963. The 1964 Act had set up industrial training boards (ITBs) for key industries, and reflected a belated recognition that statutory intervention had become necessary. The inadequacy of British industrial training is symptomatic of the generally retarded nature of British technical education, compared to other industrial societies, and the roots of the phenomenon are complex. There are three general explanations for British backwardness in technical education and training. First, the political tradition of laissez-faire, established during the process of industrialization in the nineteenth century, justified the state’s reluctance to assume responsibility for industrial training, which was considered the duty of the employers themselves. Second, employers lulled by Britain’s early economic successes have been unwilling to train their employees, and their reluctance to invest in new plant and equipment has been matched by an unwillingness to invest in the human capital of labour. The third explanation possibly subsumes the others, although like all cultural theories it can be criticized for its nebulousness. Commentators such as Barnett and Weiner have discussed the essentially antipathetic nature of British culture towards trade and enterprise.1 Yet for all their deficiencies cultural explanations pay a proper regard to the attitudinal environment in which business and political decisions are made. The differential response of employers towards training from one country to another suggests the need to seek out explanations other than those based solely upon economic or industrial logic. The unique character of each industrial society is evident to some commentators. Goldthorpe argues, for example, that because individual nations responded differently to the economic recession of the 1970s, it is prudent to consider cross-national historical and ideological differences, and the application of general economic analyses are inappropriate.2 It is necessary to examine the history of training in Britain, therefore, because it has created

2

The politics of the training market

the particular environment in which contemporary training policy-making actually occurs. BRITISH TRAINING POLICY BEFORE 1972 The joint National Economic Development Office (NEDO) and Manpower Services Commission (MSC) report, Competence and Competition, published in 1984, shattered any remaining illusions about the inadequacy of British industrial training, and made clear how backward the country’s training policies had become compared to those of Germany, Japan, Sweden and the United States. This suggests that there are indigenous reasons for the phenomenon rooted in domestic political and social factors. Sorge argues that the particularism of each country’s training system provides a caution against attempts to emulate training institutions on a cross national basis.3 Sheldrake and Vickerstaff define the specific historical characteristics of British training policy as: the strength of trade unions and employers’ associations; apprenticeship and the perceived saliency of ‘skilled’ workers within the labour force; the divorce between education and training institutions and theories; the pragmatic tradition of voluntarism in state/industry relations. . . . the degradation of training in the face of widespread unemployment . . . (. . . the misuse of training as a palliative for unemployment).4 An analysis of the history of industrial training in Britain during the twentieth century supports the contention that training has been narrowly conceived as specific ‘skills’ defined by industrialists and trade unionists, built upon inadequate educational foundations and receiving insufficient state support. It also reveals a series of historical precursors for the Youth Training Scheme (YTS) of the 1980s, all of which confused training schemes with stop-gap measures to counter unemployment. Before the industrial training boards The system of apprenticeships has tended to dominate industrial training during the twentieth century, although its roots can be traced back as far as the Elizabethan Statute of Artificers. More asserts that, by 1900, apprenticeships had become the single most important means of acquiring skills.5 Even during much of the 1980s, however, left-wing critics of the YTS still preferred apprenticeships. There is little merit, however, in a return to the 1970s when apprenticeships were the paramount form of training throughout industry despite their obvious deficiencies. These included the

Industrial training before the MSC 3

universality of the practice of five- to seven-year time-serving, variable quality in training, a massive underrepresentation of opportunities for females, and an endemic tendency towards the obsolescence of such initial training owing to the rapidity of technological change. But the Conservative government elected in 1979 added the economic argument against traditional apprenticeships that young people were contributing to their own unemployment by pricing themselves out of the market. This was the result of the curious practice in which pay rates for apprentices were phased, until in the final years of training their wage rates approximated those paid to adult skilled workers in the same trade. Trade unions have long sought to defend the system of apprenticeships, however, as bastions of craft unionism, and also as a means of maintaining high standards of pay and conditions for both trainees and workers. The apprenticeship system has frequently been challenged since the early years of the century, however, beginning with the ‘scientific management’ school, which attempted to break down skill demarcation lines. An increasing number of employers also attempted to upgrade skilled workers who had acquired their competences by ‘sitting next to Nellie’ as their response to growing foreign competition, and reformers advocated the need to provide training for the mass of unskilled workers rather than for a small band of apprentices.6 Subsequently, the two world wars had an impact upon British society in general, and on training in particular.7 The first war transformed the role of government because wartime production necessitated ‘the training of men and women as quickly as possible to perform certain definite operations’.8 The view continued to linger after the war that it was no longer adequate for government to leave training matters entirely in industry’s hands, and in 1919 responsibility for government-promoted training was assumed by the Ministry of Labour. The courses provided by the Ministry did not lead to permanent jobs during the economically depressed decade of the 1920s, but they did assist men to work for themselves or to go ‘jobbing’ for small employers. Sheldrake and Vickerstaff are correct to argue that the work of the Ministry between 1917 and 1924 was an attempt to manage the postwar crisis rather than to enhance the government’s role in training the labour force. This was consistent with the developing pattern of British government in this century which Middlemas defines as one of ‘crisis management’.9 Rather than offer a positive programme of training, therefore, government was again satisfied merely to provide ‘residual protection for the most vulnerable’.10 Hughes also suggests that until 1962 the retraining offered at government training centres (GTCs) was social rather than economic in purpose.11 The inter-war governments also deployed a further temporary palliative with the Interrupted Apprenticeship Scheme (IAS), which was allowed to

4

The politics of the training market

revert to the control of the two sides of industry. It is evident, despite the impetus caused by the intrusion of war, that official policy was returning to established patterns. It is also significant, however, that as early as the 1920s the government experimented with the introduction of training schemes for the unemployed, a full fifty years before the launch of the Youth Opportunities Programmes (YOPs). The schemes introduced in 1925 were based at the GTCs, and were aimed at rehabilitating unemployed males for work. As Oswald Allen, Assistant Secretary in charge of the Training Branch of the Ministry of Labour put it: ‘the men learn the value of regular hours and workshop practice and discipline, and the atmosphere of a Centre is that of an industrial factory’.12 Residential instructional centres (RICS) were also established to serve as ‘agencies of physical and moral rehabilitation, giving men a twelve week course of fairly hard work, good feeding and mild discipline’.13 Junior instructional centres (JICs) provided similar, although non- residential, schemes. After 1930, unemployed males who refused to take up a place at a centre could be refused unemployment relief. It can be argued that both junior and adult versions of recreational centres were primitive versions of the youth and adult schemes introduced in the 1980s. There were parallel training schemes for women orientated towards domestic service. This at least has not been replicated in recent training programmes which attempt to follow an equal opportunities policy. The character of state-sponsored training was captured by a government memorandum of 1935 which observed: ‘the able bodied poor are set to work though in recent years this phrase has been replaced by the euphemism of training’.14 While Britain reverted in the inter-war years to a degraded form of training which was completely inadequate by international standards, participation in the Second World War rather changed matters. Again it was the extreme demands of war which spectacularly revealed the shortfall of skilled workers required for the munitions industries, and colleges had to gear up to provide emergency training. The Second World War also placed educational reform at the top of the domestic political agenda, and no aspect was highlighted more than that of technical education. Enlightened employers represented by the British Association of Commercial and Industrial Education (BACIE) exerted pressure on the President of the Board of Education, R.A. Butler, to expand technical provision. Responding to pressure from industrialists, the coalition government increased by fourteen the allocation of monies for technical education between the White Paper of 1943 and the publication of the Bill in 1944.15 This reflected the widespread concern to expand post-war provision of technical training, which was evidently inadequate for a competitive post-war order.

Industrial training before the MSC 5

The provision of immediate training schemes to respond to the man-power crisis created by the exigencies of war fell upon the Ministry of Labour and National Service which, since it controlled the vital resource of labour, became a key government department. As a result, training schemes increased in importance, ceased to be palliatives for unemployment, and attempted to assist industry to convert to the needs of wartime production. The numbers receiving training between 1939 and 1945 rose to 525,000 people.16 The scope of the training was limited to familiarizing trainees with a single machine or process, but the Ministry also set up the Training within Industry Advisory Service (TIAS) which involved technical staff visiting factories to offer assistance in the setting up of in-house training programmes. This foreshadows some of the MSC and TEC training and enterprise services in recent times. Yet the Minister of Labour, Ernest Bevin, still considered the state’s role to be complementary to industry’s own efforts, since in the view of ‘employers, managers, trade unions and workers the place to receive training continued to be on the job’.17 Despite the state’s innovative vigour in other areas after the war, little developed in the sphere of training. Although the 1944 Act held out the promise of local education authorities (LEAs) being requested to prepare comprehensive schemes for further Education, within months the Board of Education destroyed all hopes by postponing all such requests.18 It was only in 1956, with the first real concern about Britain’s relatively poor post-war economic performance emerging on the political agenda, and the anxieties about inflation entering the system, that the Minister of Education, Sir David Eccles, responded to the need to expand technical education. Similarly, the government’s concern about industrial training declined in the first post-war decade, with the Ministry’s involvement confined to the margins of the labour market and dealing with groups impeded by special difficulties. Industrial training was still perceived as being largely synonymous with apprenticeships and regarded as a matter for the two sides of industry to manage. Apprenticeships also continued as five-year terms, two years longer than those practised by Britain’s European counterparts. While most apprenticeships involved day-release provision at further education colleges (FECs) by the 1950s, there was still no standard qualification.19 This entirely voluntarist approach was becoming a cause of some concern, however, and as a result the National Joint Advisory Council (NJAC) of the Ministry of Labour set up a special committee. The committee’s report supported the continuation of the voluntary principle, however, and urged that training should remain the primary responsibility of industry, although it admitted that ‘a boy [sic] who fails to obtain an apprenticeship has usually little chance of obtaining . . . systematic training in employment’.20 It is easy to criticize this judgement in retrospect

6

The politics of the training market

simply because subsequent statutorily encouraged activity by industrial training boards (ITBs) and the MSC suggested that a laissez-faire approach had to be superseded. It is also premature to determine whether the new training and enterprise councils (TECs) are truly market-based and whether they can succeed in increasing the provision of appropriate training. Even when the state is active, however, there is a clear limit to what it can do in a market or a mixed economy where employers are recalcitrant and trade unions entrenched in their attitudes. There is now a wide acceptance that the failure to train industrial manpower adequately was the most substantial cause of Britain’s post-war economic weakness. This judgement counters a common view on the left of British politics that it was industry’s failure to invest which was the fundamental cause of economic weakness in the thirty years after the war. Yet the immediate post-war Labour government promoted substantial investment, and it is now evident that undertrained manpower and skills bottlenecks ensured that the most effective use could not be made of it. By the early 1970s it was increasingly recognized that it was inadequate productivity per person which was at the root of Britain’s poor economic performance. The limited effectiveness of training policy was the main source of this problem. Laissez-faire political ideology, thirteen wasted years of complacent Conservative government and a cultural aversion to technical training can all be condemned, but the prime responsibility for inadequate training must lie with the ‘blinkered’ and defensive short-termism of both sides of industry. The turn to planning Circumstances changed in the early 1960s with the growing elite consensus that new and radical departures were necessary if Britain was ever to match the economic performance of its main competitors. This was significantly revealed by the conversion of Harold Macmillan’s Conservative government to planning with the establishment of the tripartite National Economic Development Council (NEDC). This was accompanied by a plethora of books condemning British traditionalism and advocating dynamic institutional reform.21 Foreign models of a more interventionist form of economic management, particularly those of French ‘indicative planning’ and the West German ‘economic miracle’ were increasingly proposed, and it was in this spirit that the Ministry of Labour and professional educators argued that Britain’s voluntarist training system lagged badly behind that of its European competitors. The two sides of industry wished to preserve the privileged position in which they could protect their distinct interests. Skilled labour was able to attract good wages, and employers were left free to train or not to

Industrial training before the MSC 7

train according to their own perceived short-term selfinterest. The growing enthusiasm for state solutions and for a ‘turn to planning’ which converted the Conservative government to interventionism, however, soon also began to pervade the training policy community. The ease with which politicians, civil servants, employers and trades unions adapted to the ‘turn to planning’, and the idea of a tripartite partnership between the main economic interests and government can be explained because most of the political actors involved had a nostalgic memory of planning in a crisis during the Second World War. Middlemas refers to the recurrence of an optimistic belief in class convergence within a mixed economy22 This was reflected in the world of training by a report from the Ministry of Labour, which accepted that the chief responsibility lay with industry, but anticipated the case for a greater role for the state.23 The British Employers Federation still continued to express its opposition, however, to the increasingly canvassed idea of a training levy on firms to spread the cost.24 One employer expressed a more progressive opinion at a BACIE conference at this time, arguing that a compulsory apprenticeship authority be set up for each industry, and that a fund be contributed to by all employers.25 But BACIE was in the vanguard of the argument for technical education during the war. Sarah Vickerstaff is correct to argue that many employer attitudes began to alter at this time as they recognized that voluntarism was as unlikely to remedy Britain’s training deficiencies as it was to strengthen the economy, given the incapacity of voluntarism to promote incomes restraint and industrial restructuring.26 So the early 1960s was one of those intermittent phases in history when the normal pattern of incremental change was challenged by the spread of ‘new appreciations’ about the world, and with a growing commitment to an interventionist approach. The rise and fall of the industrial training boards This new spirit was reflected in the training field by the government White Paper Industrial Training: Government Proposals (Cmnd. 1892). This document conveyed the concern that training decisions could not just be left to market forces, and it argued that there was a close relationship between the level of industrial training and the rate of economic growth.27 Its most innovative proposal, which was contained in the 1963 Act was to spread the costs of training evenly across the companies. It recognized that this required the creation of tripartite training boards within major industries. The Labour Party spokesman, Ray Gunter, was aware of the seachange which had occurred over a five-year period when he observed that the state, the unions and the employers had all changed their attitude to state intervention in training.28

8

The politics of the training market

Neither the Trades Union Congress (TUC) nor the employers were entirely uncritical of the proposals. Employer fears were revealed in their demand that they should have a majority on the proposed training boards, and the trade unions preferred the idea of a strong central co-ordinating body which they finally obtained with the MSC in 1974.29 Evidently, the TUC’s enthusiasm for planning prevailed over their desire to defend their historical privilege of controlling apprenticeships. Training policy was now becoming a full part of the wider effort to expand the economy and increase production through ‘tripartite concertation’. Yet the initiative had originally come from the state; and Whitehall maintained the impetus as the National Plan of 1965 emphasized the centrality of training in the search for improved economic growth, and the National Economic Development Office (NEDO) examined manpower training issues. The Industrial Training Act of 1963 included both ‘carrot and stick’ provisions for employers. The stick was evident in the compulsory levy, and the carrot involved the spreading of training costs and the weakening of trade union control over the apprenticeship system. The Act created a Central Training Council (CTC) with six trade union and six employer representatives, plus tripartite industrial training boards (ITBs) to manage the levy/grant system. By 1966 thirteen ITBs had been set up to cover over seven million workers. The CTC’s role was to be advisory and consultative, but it helped promote the tripling of GTCs from a mere thirteen in 1962 to thirty-eight by 1967. At the peak of the expansion there were twenty-four ITBs all pursuing the three objectives of supplying an adequate number of trained workers at all levels within industry, improving the quality and efficiency of training, and distributing the costs more equitably between companies. They also fulfilled a useful liaison function between industries, as well as between industry, government and trade unions. The ITBs also provided information and consultancy services, and in some cases even produced training courses. They were therefore responsible for many advances in the decade after 1964 and their worth has rarely been acknowledged.30 The ITBs rapidly became unpopular, however, particularly with smalland medium-sized employers, who considered them bureaucratic and intrusive, especially in their grant/levy activities. These objections were sustained by the Bolton Committee of Enquiry into Small Firms. On the other hand, the Confederation of British Industry (CBI) regarded the arrangements as broadly satisfactory for large firms. Small firms objected to the ITBs’ failure to evaluate informal ‘on the job’ training as fully worthy of levy exemption, and so came to regard the levy as just another tax.31 While there were undoubtedly shortcomings in the actual operation of the ITBs, the objections of many employers were motivated by the very short-termism which had marred the whole development of training in Britain. Although

Industrial training before the MSC 9

the industry, skills and even job-specific training of the ITBs was not necessarily helpful to the country as a whole, and provided a non-optimal allocation of resources for training within and between industries, the merits of the ITBs were not fully appreciated at the time. There were clear improvements in the quality and quantity of industrial training, and even advocates of the abolition of the grant/levy system based their case on the fact that the ITBs had succeeded in changing the attitudes of employers in favour of investing in training to such an extent that they were no longer required. Maureen Woodhall asserts that the Act increased the numbers of firms providing training, and the DE estimated that the numbers of workers undergoing training increased by 15 per cent between 1964 and 1968.32 Similarly, the ITBs encouraged the growth of apprenticeships as is revealed by an increase from 36 per cent in 1964 to 42 per cent in 1970, falling back to 39.5 per cent in 1971, while the proportion of girl apprentices increased from 5.7 per cent to 7.6 per cent. It is likely that much of this increase can be attributed to the ITBs, although the reduction after 1968 could be explained by employers becoming used to the existence of the ITBs and to the levy system. It is more probable, however, that the reductions after that date reflected a general decline in economic activity, and a response to the announcement by the new Conservative government in 1970 that the ITBs were under review.33 The quality of the training provided by the ITBs was also high, according to the DE itself: ‘Whatever the evidence on the volume of training stimulated by the Boards there can be little doubt about their influence on the quality and efficiency of training, which have improved since 1964.’34 The DE attributed this improvement to the fact that ITBs did not accept the validity of informal ‘on the job’ training, but insisted that in order to qualify for a grant, training must be based upon clear objectives and be provided by trained instructors. There were some additional indicators of quality, however, such as an increase in the number of full-time training officers, together with a growth in day release to further education (FE) colleges.35 The CBI certainly took the view that the quality of training had improved, and that the 1963 Industrial Training Act had helped ‘transform the whole climate of opinion and concentrate far more attention on training . . . This may prove to be its greatest benefit so far’.36 The government turned this into an argument in favour of the abolition of industrial training boards, since it suggested that ‘a permanent shift in attitude in British industry has been secured’.37 The government was on stronger ground in asserting that the ITBs had raised both the quality and quantity of training, but it was less convincing in the argument that the freeing of employers from levy/grant arrangements would achieve the same goal. On the contrary, the evidence suggests that

10

The politics of the training market

employers were still prone to cut their already pitifully inadequate training budgets when economic conditions were unfavourable, although it is at such times that it is most sensible to engage in counter-cyclical spending. As James Hughes argued: the ITB structure would lend itself ideally to the development of an anticyclical adult retraining programme. All that would be required is that as the demand for labour declines cyclical retraining grants be paid to those employers who are prepared to take on and train previously unemployed workers or workers who they would otherwise have made redundant.38 It must be recognized, however, that some policing of such a scheme would be necessary to prevent the development of what was later described as the ‘deadweight’ effect, to ensure that grants were not paid to employers for hiring workers who were required in any event. In practice, a policy of counter-cyclical spending was never funded by the state and the full possibilities of the ITBs were never fully tested. In fact, the ITBs were emasculated by the Heath government which responded to employer pressure. They were fatally weakened, therefore, without a proper policy analysis and review (PAR) or cost benefit analysis (CBA) – the rational devices to which Edward Heath purported to be committed – being undertaken to evaluate their worth. Some of the contemporary criticisms of the ITBs were valid. They may not have had sufficient time, but they clearly failed to convert either employers to the cause of training, or firms (understandably anxious about the very survival of their enterprises at periods of recession) to the practice of countercyclical spending. Yet counter-cyclical investment in training had become the norm in both Germany and Sweden. Even if it is argued that in these countries it was a partnership between state and employers which funded the expenditure, the ITBs also failed to convince the government that manpower planning policies could yield substantial macro- and microeconomic benefits. At the micro level, even in the 1990s, it remains clear that many firms require both proselytization and counselling in order to maximize fully their business opportunities. Equally, at the macro level it appears that in 1972 there was a tendency by policy-makers to perceive training either as an end in itself or as a palliative against unemployment, instead of as a contributing element towards the overall goals of economic management – such as full employment, stable prices, a balance of payments surplus and economic growth.39 One commentator argues that the expansion of training provision can have a profound effect upon reducing labour-market disequilibrium, particularly where it is promoted by closer collaboration between job centres and training centres, and by a change in unemployment

Industrial training before the MSC

11

regulations, to make training an attractive alternative. Yet it would be harsh to lay all the blame for the failure of government to establish proper macroeconomic policies geared to appropriate manpower planning objectives on the ITBs. Neither they nor the longer established GTCs could achieve such goals in isolation. It is more difficult to defend the ITBs against the charge that their industrial structure was ill-equipped to contribute towards the redeployment of labour or to assist in the improved distribution of the workforce between regions and industries. Such objectives could only be advanced by a national body, such as the MSC.40 Yet whatever the national policy, or the organization charged with its delivery, little progress can be achieved unless industry is prepared to make an effective utilization of trained manpower. In the 1990s such considerations are recognized with the growing policy thrust towards improving the quality of the training given to underprepared managers by such developments as the Management Charter Initiative (MCI). But even if the ITBs did not have a transforming impact, the main deficiencies occurred at the level of individual companies, and still more with central policy makers. It was the very lack of a policy for national manpower planning which prevented a proper evaluation of the contribution which the ITBs could offer. McCormack argues that the orthodoxies of the time ensured that the education system was unfairly set up as the scapegoat for labour market difficulties. He suggests that there was: scant attention to the Industrial Training Boards’ influence on the supply of qualified manpower, and that this neglect of the possibilities of direct action upon the stock of qualified manpower in industry, in favour of concentration upon the new supply from the educational system, represented a usurpation of political responsibilities, and an attempt to place the burdens of change on the education system.41 Despite the vociferous opponents which they attracted, it is apparent that many training officers (TOs) regretted the ITBs’ demise. The journal Training Officer expressed the view that: despite the near miraculous transformation they have achieved since 1964 critics are marshalling their forces to abolish them. Could such critics have known much about the wilderness before 1964 they would surely think twice before they do the shooting and put the clock back.42 Nevertheless, the 1972 White Paper, Training for the Future, justified its intention to weaken the ITBs by transferring their functions to the proposed MSC, with the arguments that ITBs were unsuited to the needs of small

12

The politics of the training market

firms, were badly placed to deal with occupations common to several industries, and were not equipped to handle regional problems or to help those in declining industries to transfer to more modern ones. The ITBs continued on a smaller scale in the 1970s and 1980s under MSC administration, fulfilling such supplementary roles as liaison between government and industry and between ITBs and other partners in training and education. They also provided their own training courses. Since coming under renewed attack in the early 1980s by, for example, the Centre for Policy Studies, who were critical of their bureaucracy and profligacy and their failure to respond to the needs of small firms, the ITBs have lost status. A mere handful survived into the 1990s, and they have now been replaced by new industry-led bodies, the industrial training organisations (ITOs). THE EMERGENCE OF THE MANPOWER SERVICES COMMISSION (MSC) The Heath government’s ideological confusion is revealed by its U-turn from laissez-faire to interventionism in 1971–2. This contradiction was evident when it both demoted the ITBs by ending their statutory grant/ levy practices in response to the pressures of employers, and sought simultaneously to create a powerful organization with overall national responsibility for both employment and training policy. It is also possible to trace a linear policy-making perspective within the DE itself, which utilized reports from research programmes which had been embarked upon during the Wilson Labour government of the 1960s. The report People and Jobs published in July 1971, for example, was based upon an eighteenmonth review of the work of local employment offices, and of an analysis of policies in other countries. The report expressed a strong interest in Swedish manpower policies: for example, Arbetsmarknadsstyrelsen (AMS), the Swedish Labour Market Board, which represented both employers and trade unionists. The main conclusion of the report was that the established employment service in Britain was deficient because of the manner in which it combined ‘dole’ and ‘job search’ activities in one agency, which prevented the exploitation of the opportunities inherent in a modern labour market. As a result, the service was perceived by the unemployed as an instrument to pay dole monies, and employers scarcely used it as they considered that it would only have unsuitable clients on its books.43 The report urged a new service to convince employers to notify vacancies, persuade job-seekers to visit, place workers in a wide range of occupations, improve the quality of advice available for potential trainees and to aid employers to anticipate changes in the local labour markets. All this required a new administrative structure to separate employment services from the payment of benefits,

Industrial training before the MSC

13

and to unite job training and counselling. The service should be more independent of ministers and parliament as well as more responsive to the community.44 The report also advocated the establishment of a Council of Manpower Services involving management, trade unions and industrial trainers, because Britain required a dynamic instrument of wider labourmarket policies. It is evident, therefore, that the impetus for the later creation of such a body came from Civil Servants carrying out a review set up by the Labour government as well as from the TUC. The TUC’s 1972 review document publicly urged a National Manpower Board, and as early as 1967 the TUC had called for the creation of an independent National Training Council with power to direct the ITBs.45 The government published the White Paper Training for the Future in February 1972, and it was ambivalent about the ITBs when it suggested that they should be subsumed under a new National Training Authority. The idea of reorganising some government services into ‘hived-off’, semi-autonomous, but still accountable units was becoming fashionable in the managerial approach to civil service organization generated by the Fulton Report’s publication in 1968.46 The introduction of a more independent management would provide a clearer allocation of responsibility, and more readily facilitate the process of management by objectives. According to the Civil Service Department (CSD), the main cases of ‘hiving-off’ actually occurred in the DE, where the creation of the MSC was followed by similar entities such as the Health and Safety Commission (HSC) and the Advisory and Conciliation Service (ACAS).47 The 1972 White Paper Training for the Future set up the Training Opportunities Scheme (TOPS) in advance of the MSC’s establishment. In the White Paper’s preface, the Secretary of State for Employment, Robert Carr, recognizing the ITBs’ success in changing industrial attitudes towards training, still considered them to be defective. He stressed his commitment to the goal of a better trained manpower capable of responding to new skills requirements. Also reflecting the rather less utilitarian conception of education which prevailed at that period as compared to the 1980s and 1990s, he supported training as a way of enabling individuals to acquire greater personal satisfaction.48 The White Paper’s main preoccupation, however, was the need to develop training programmes and standards for those fields of employment not covered by the ITBs, particularly those which crossed institutional boundaries. Carr argued that a new national training agency, operating with its own budget, could help deliver the government’s objectives.49 Although Carr cited the impact of French, German and Swedish ‘models’ on government thinking, David Howells correctly draws attention to other elements. He argues that the Heath government was influenced by the

14

The politics of the training market

suggestion that both sides of industry should take responsibility for the operation of services designed for their benefit. He adds that the government was generally influenced by an ideological preference for the tripartite approach towards economic management and by its desire to conciliate the trade unions in order to reach an understanding on pay.50 It is evident that a new national agency responsive to trade union influence was a favourite TUC project. The Heath government’s decision clearly reflected its shift away from the ‘free market’, so-called Selsdon policies, on which the 1970 general election had been fought, towards a tripartite and interventionist posture. John Biffen argues that Heath had been open-minded about the Selsdon philosophy, but when the inflationary situation developed in the early 1970s he clearly lacked a commitment to see the situation through ‘foul weather’.51 Yet the TUC was not entirely successful in imposing its own preferred model upon the DE. Despite sending a number of delegations, the TUC failed to secure a guarantee from the Secretary of State that the new agency’s ruling commission – on which it would be well represented – would be given powers to promote temporary job-creation schemes on a substantial scale, or to engage in national man-power planning and budgeting.52 Yet the Heath government was not so committed to planning that it refused to respond to the pressure which flowed from employers, to the effect that the ITBs were excessively interventionist bodies. The Training Officer journal frequently printed the complaints of employers who considered that the ITBs actually impeded the growth of training by interrupting the links between employers and workers, and employers and the DE. A former Conservative Employment Minister, Sir Paul Bryan, represented this strand of thought when he urged that ITBs should be confined to standard setting and advice. He also advocated the view that employers should be responsible for training, but judged that they needed improved information about local labour market trends. 53 These two elements remained at the centre of the Thatcher and Major governments’ policy, but what was different about Bryan’s position was his support for a national training agency, outside the conventional Whitehall civil service machine, to coordinate and supplement the ITBs in providing an advisory service. Many employers were more committed to the free-market Selsdon philosophy, however, and were sceptical of any national agency. This view was reflected in the CBI’s ambivalence towards Training for the Future. While it welcomed the White Paper’s differentiation between the state’s responsibility to provide for the training needs of individuals, and the employers responsibility to meet the needs of firms, it also warned that ‘industry would view with some uneasiness the proposed structure and financing of the National Training Agency’.54 Clearly, the employers who were worried about the extent of the ITBs’ powers were most wary about

Industrial training before the MSC

15

the full implications of a national agency for training. It is evidence of the still considerable influence of trade unionists over government policy in 1972 that they were able to win so many concessions towards their own ideas about the organization of national training policy. Despite the greater ambivalence of its own members towards such a development, the CBI formally approved the idea of a national agency in April 1972.55 In June of that year, both the CBI’s Director General and the General Secretary of the TUC sent a joint letter to the Secretary of State for Employment to urge that greater funding be provided, owing to the ending of the levy/grant system. They jointly urged that the managing board of the new training agency should employ its own officers, who would be accountable to the management rather than to the DE.56 The TUC did not achieve all of its demands, however, since by October 1972 it complained that the new agency would not be sufficiently independent of government. Yet most of the individual trade union leaders accepted that since it was government funded, the agency had to be responsible to the Secretary of State for Employment, while warning that ‘any managing body constituted on tripartite grounds would have to be sufficiently independent of government, and have scope to act as an innovating body for it to be worthwhile for the TUC to participate in its work’.57 The Secretary of State’s response was that the government wished to let the managing body operate within the broad objectives which it laid down, but that there would not be detailed interference. Yet while the TUC was disappointed at the lack of independence enjoyed by the managing body, it successfully urged the Secretary of State to employ a full-time chairman to counterbalance the role of the Chief Executive. The TUC called for an expansion in the managing body, or as it became known the Commission’s role, so as to enable it to promote job-creation programmes or to engage in national manpower planning and budgeting. In November 1972 the government formally announced the creation of the Manpower Services Commission (MSC), providing it with a brief to co-ordinate employment and training services through an Employment Services Agency (ESA), and a Training Services Agency (TSA), managed by a ten-member Commission drawn from both sides of industry, local authorities and education interests. Three were drawn from the CBI, three from the TUC, two from local authorities (including one from Scotland) and an educator.58 The TUC was concerned that major policy changes could occur in the interval before the ruling commission could assume its responsibilities through the development of the TOPS scheme and the setting up of TSA and ESA; and in a letter to the Secretary of State in December 1972, the TUC duly urged that the Commission’s establishment be hastened. Despite its earlier support for the ITBs, however, it no longer

16

The politics of the training market

objected to the White Paper’s proposal of a levy exemption scheme for specific boards who requested it. Subsequent events confirmed the TUC’s anxieties that policies and practice would already be well entrenched before the new commissioners could take control. Ince argues that the emergence of the TSA and the ESA reflected the powerfully shaping influence of the DE’s culture and organization. For example, the employment services within the DE had long enjoyed a discrete identity, and until the Heath government’s conversion to the planning model on the lines proposed by the TUC, it was intended to set up two separate organizations for employment and training services without an umbrella body. Circumstances changed in the wider political environment, however, and the DE’s own review (which has already been discussed) also advocated the amalgamation of employment and training activities on the grounds of administrative rationality. By mid1972, therefore, ministers had decided in principle to consolidate the management of the two services. It is also evident, however, that many of the crucial decisions on the development of the employment services were taken before the MSC’s advent: for example, the opening of high-street Job-centres from mid-1973, and the setting up of special services for highlevel jobseekers through the Professional and Executive Recruitment (PER) agency. And while the TSA was a new creation, the formal launch of TOPS in 1972 determined the direction of the TSA’s work for a long time after the Commission formally assumed responsibility on January 1 1974. Howells has demonstrated that there was a complex regional structure for TOPS in place by 1973.59 The MSC and its powerful internal institutions were formally brought into being by the Employment and Training Act of 1973. Both the ESA and the TSA were made corporate bodies. Policy clearly shifted from a carrotand-stick approach towards an acknowledgement of the need for a more active state role. Sheldrake and Vickerstaff detected a major anomaly in the type of MSC which emerged from the legislation, which symbolized the need for a genuinely economy-wide co-ordination, but failed to retain or create mechanisms, for translating these national policy objectives to the level where training actually occurred, the individual company.60 Section 2 of the Act conferred a broad duty on the MSC, ‘to make such arrangements as it considers appropriate for the purpose of assisting persons to select, train for, obtain and retain employment . . . and to obtain suitable employees’. There is scope for debate about the extent to which the MSC was a corporatist institution, but it is evident that in 1973 the government was concerned to protect the dominant role of the state in the man-power planning field. The Act laid down that the Commission’s role was ‘to ensure that its activities are in accordance with the proposals approved by the

Industrial training before the MSC

17

Secretary of State’. In carrying out its brief, therefore, the MSC had to obtain the Secretary of State’s approval for its proposals. These legal formulations were also reinforced by the DE’s power to appoint the MSC’s chairman, and to control the organization’s budget through a policy of grants-in-aid, plus Treasury control over allowances and fees. The MSC may have been capable of exercising influence, but it has never been independent. The TUC unsuccessfully attempted to persuade the government to modify the Bill in March 1973, but with little success. The Employment Secretary maintained that the government was responsible for economic management and regional policy, and so it needed to retain the main responsibility for manpower planning within the DE. The functions of job creation crossed departmental boundaries, but the Commission could only take over duties previously exercized by the DE. When the same union delegation urged funding as favourable as that deployed by AMS (the Swedish Labour Market Board), the response was that the Swedish case could not be compared with Britain, because it included some British DHSS expenditure, as well as some finance-generating projects which the MSC would itself be free to develop. The only concession occurred at the implementation stage of the Act, when, owing to strong objections from Civil Service staff associations to the proposed loss of Civil Service status, the appropriate section of the Act was never applied, so the MSC came to occupy a curious limbo position retaining Crown status. CONCLUSION The Act made arrangements to incorporate the ITBs under the MSC’s umbrella, although they were shorn of much of their previous prestige. They had scarcely been given the opportunity to demonstrate their worth, but by being subsumed under the MSC they lost the opportunity of transforming the training scene. The creation of the MSC, therefore, was the second conscious attempt to improve training. Some employers had welcomed the way in which the ITBs had shared the costs of training more equitably across industry, and the trade unions were pleased with the belated statutory recognition that training was an economic and social benefit. Even some in the state machine considered that the ITBs would induce a long-term consciousness in industry about its own self-interest in the promotion of training. Yet in the short time available to them it is clear, without any requirement for a full cost-benefit analysis, that they did not manage to reform the apprenticeship or adult training arrangements and were unable to generate a voluntary cross-sectoral approach to training investment.

18

The politics of the training market

The 1973 Act was, therefore, a compromise response to TUC demands for the national co-ordination of training on the one hand and to the shortsighted interests of certain employers on the other. The cautious independence bestowed on the MSC, the deference towards to the two sides of industry implicit in the MSC’s composition, and the reluctance actually to abolish the ITBs, place the Act firmly within the incrementalist style of policy-making which is so well rooted in Britain and other advanced industrial states. As the Act was an attempt to conciliate powerful interests, while providing a new impetus to training, it was ambiguous in character. The exact role of the MSC as a whole, and the Commission generally, was left indeterminate. The fifteen-year period from 1974 to 1988 witnessed the working out of these difficult relationships; a task made the more difficult by the national proneness to recurrent economic and political crisis.

2

The Manpower Services Commission: 1973 to 1981

The period from 1974 to 1981 was one in which there was an expansion in the scope and range of activities encompassed by the MSC. Yet there were two milestone events during this period. The first was in April 1978 when with the launch of the Youth Opportunities Scheme (YOPS) the MSC acquired fame if not always prestige, and the second a year later when the election of Margaret Thatcher as Prime Minister brought its entire future under a cloud of doubt. Although the continuation of the MSC was confirmed in 1981, which emboldened it to introduce the New Training Initiative (NTI), its period of unquestioned growth was clearly at an end. It was during the 1973 to 1981 stage in its development, however, that the MSC came closest to ‘corporatist’ behaviour, when the ten-member Commission (representing the peak organizations of the two sides of industry) actually enjoyed substantial influence over the formation of industrial training policy. This chapter begins with an analysis of the politics, management and finance of the MSC, and continues with a brief consideration of its employment policies, a longer examination of the development of its central training policies and the final part reviews the whole period in a more detached and analytical way. THE MSC’S STRUCTURE AND FINANCE The effectiveness of institutions in British political life may be determined by their status, but their status is largely a function of their structure and finance. Structure The MSC came into existence, united by a managing Commission of ten representatives, but bifurcated into two already established and well entrenched agencies. The two agencies, the Employment Services Agency

20

The politics of the training market

(ESA), and the Training Services Agency (TSA), possessed entirely discrete management structures. Paradoxically, however, the 1973 Employment and Training Act also created a single secretariat as well as the governing Commission. The secretariat employed forty staff led by an under-secretary, which carried out overall financial management. The Commission’s role was to formulate the MSC’s strategic employment and training policies, which were then to be implemented by the two distinct agencies of the ESA and the TSA. The Commission’s precise powers were unclear from the outset, since the statutory definitions which the Act laid down left much to be determined, in political practice, by bureaucratic factors. It was also the case that the MSC came into being with many of the main configurations of employment and training policies already established. This was apparent in the employment field with the setting up of the new Jobcentres. David J. Howells asserts that while: the influence of the Commission has naturally increased over time, much of the expansion of MSC activity and spending was planned and more or less determined before 1974. It would have been most surprising had the newly established Commission chosen to divert the agencies from their course in its first year or two, especially as little thought had previously been given as to how the Commission would actually go about its business.1 The main institutional reality in the MSC’s management between 1974 and 1976 was the superimposition of a new controlling body upon two established services, which prevented the growth of a properly integrated organization. Only in 1976 did two events combine to give the MSC a clearer identity. These were the appointment of Sir Richard O’Brien as the MSC’s new chairman to replace Sir Dennis Barnes, who had chaired the Commission for the first two years, and the publication of an ambitious document: Towards A Comprehensive Manpower Planning Policy. The appointment of O’Brien to the chairmanship was interesting because it was done in a pseudo-‘corporatist’ fashion, as his name was suggested by the CBI and approved by the TUC. The document on manpower planning was the first practical fruit of the MSC’s role as a planning agency linking employment and training policy together, as it had been conceived to do in the ideas on government reorganization which flourished in the Heath years from 1970 to 1974. External circumstances as always were as important as internal MSC/DE politics in increasing the MSC’s role at this time. Britain was undergoing a major economic crisis in 1976 which required the development of special labour-market measures, which the MSC was particularly well equipped to provide.

The MSC 1973–1981

21

Harold Wilson’s minority Labour government from March to October 1974, and his majority government after October, virtually coincided with the MSC’s emergence. Since the MSC had been created by the preceding government, however, and because the new Labour government had other priorities with which to deal, such as the aftermath of the bitter miners’ strike of 1973–4, the Common Market referendum, soaring inflation – and all in the middle of high expectations from a Labour party rank and file that a new era in left-wing socialist politics was about to unfold – the government felt unable to devote much attention to the MSC. The ‘stagflation’ problem (that is to say, simultaneous inflation and unemployment and a consequent collapse in international confidence) had become so overwhelming by 1976, however, that the government began to turn to the MSC to provide amelioration. This was a mixed blessing for the MSC, as the enhancement of its role also involved a distortion of its purpose of producing long-term strategies to promote manpower, training and employment policies. Yet the conflict was not immediately evident, as the development of the ameliorative measures which government was seeking also enabled the Commission to give a higher profile for its proposals on a national manpower planning strategy linked to government macroeconomic policy. This was the context for the attention given to Towards A Manpower Planning Policy. The adoption of this integrated and unified strategy implied structural change, however, since the development of separate networks for the ESA and the TSA militiated against a common approach, and the officials of the two agencies were more concerned with agency-specific priorities than they were with the MSC as a whole. Howells argues that the establishment of the Commission had little effect on most MSC staff, who considered that their own career development was best advanced by producing results in their own agency. The Commission also allowed the two chief executives full rein. While the Secretary of State for Employment had substantial powers, the MSC’s own secretariat was weak, and Howells argues that in reality the DE was ill-equipped to exercise an effective control. In fact, the unit responsible for liaison between the department in London and the MSC was located in the DE’s finance division, which scarcely facilitated an active involvement with the MSC’s manpower planning policies. Howells suggests that the DE ‘faced a problem similar to the sponsoring departments of hivedoff bodies and nationalised industries: how to assess activities and advise ministers adequately without building a parallel bureaucracy’.2 The Commission began to demand a greater voice in the development of effective British manpower policies, at the very time when the government began to perceive a political and economic use for the MSC, and it was this confluence of influences which led the Secretary of State for Employment,

22

The politics of the training market

Michael Foot, to appoint an Under-Secretary to the post of Director of Manpower Intelligence and Planning in late 1975. Economic crises apart, the Labour government was responsive to the idea of a more potent Commission generating an active manpower policy, and since the TUC was simultaneously being called upon to support an incomes policy, the government was content to allow greater responsibilities to the three TUC commissioners. The October 1976 publication of Towards a Comprehensive Manpower Planning Policy was the first expression of the increased activity of a more assertive Commission and a greater overall organizational impulse. Yet the MSC’s own self-description in its document reveals the transitional nature of its management structures. It was: operating through two agencies, the Employment Services Agency (ESA) and the Training Services Agency (TSA) – each of which is a statutory corporation headed by a chief executive, and the two agencies employ about 25,000 separate staff in over a thousand separate establishments.3 Even at the stage of organizational transition, however, the potential for increased integration was plain, particularly when the document referred to the MSC’s executive function of advising the government on manpower policy questions. The document’s publication itself foreshadowed a more corporate approach, and, also at this time, the organization inaugurated the system of publishing a five-year forward review, or Corporate Plan. Howells suggests that the process of strengthening the MSC’s unity was assisted by the appointment of the then John Cassels as MSC director at the end of 1975. While Cassels was a highly distinguished figure in the MSC’s development, however, the agency chief executives continued to report directly to the Commission. O’Brien’s appointment was more important, and he promoted integration by setting up the chairman’s management committee to bring together all the senior MSC officials on a regular basis. He perceived the need to acquire a clearer marketing image, and so abolished the separate agency logos and house colours, and in April 1978 the ESA and the TSA became the Employment Services Division (ESD) and the Training Services Division (TSD) respectively. The changes were designed to increase MSC consciousness among staff, but although they weakened the old agency loyalties, the sheer size of the organization represented by its vast labyrinthine building in Sheffield after 1979, made a sense of common purpose difficult. Yet, as has already been noted, April 1978 was also the date when YOPS was launched. It is ironic that at the moment when the MSC and the Commissioners were striving to develop an integrated manpower plan through a united organization, rising unemployment was forcing the MSC to become entangled in ad hoc special

The MSC 1973–1981

23

measures of a job-creation variety. This was redolent of inter-war policy which has already been discussed. The MSC continued the attempt to develop more effective planning and management functions. A new director of corporate services was appointed in December 1977 who was the line-manager for matters previously dealt with at agency level – such as personnel, premises, marketing, finance and organization and methods work. As a result, resources could be centrally planned. Regional arrangements were also altered with the creation of new regional manpower service directors (RMSDs) responsible both to the Commission and to the Secretary of State. Yet in 1979 it was still the regional directors of the ESD and the TSD who exercised greater control over staff than did the new RMSDs.4 It would be an obvious error to imagine that managerial reorganizations of agencies impinged much upon the MSC’s popular or political standing. It was the acronyms of YOPS and TOPS (the Training Opportunities Scheme) which brought fame to the MSC, but these schemes only flourished because government ministers allowed them to develop. The support of ministers flowed from their consciousness of the scale of recession and unemployment, before the political discovery of the 1980s that British governments could survive high levels of unemployment. Before that discovery, the government, particularly that of James Callaghan after 1976, favoured the MSC because, like the education industry in the 1960s, it regarded the organization as a problem-solving force. For these reasons the Treasury left the MSC exempt from the public expenditure cuts of the late 1970s. The MSC’s political independence must not be exaggerated, however, as throughout the period it depended upon ministerial patronage for its privileges. On the other hand, the economic and labour market realities of the 1970s were grim enough for there to be a relationship of mutual dependence between ministers and the MSC. The MSC’s standing was further strengthened after the autumn of 1976 by the decline of education in the perception of policy-makers. This was highlighted in Callaghan’s Ruskin College, Oxford, speech in which he criticized the education system for failing to produce employees with the qualities which employers and the national economy required. By contrast, the MSC was considered more capable of producing relevant training experiences.5 Finance Treasury ‘mandarins’ informed MSC officials of: unsolicited increases in the MSC’s grant-in-aid, at a time of general expenditure constraint. It would be therefore wrong to think of the

24

The politics of the training market

Commission continually pressing reluctant ministers into ever greater spending commitments . . . ministers have generally been happy to point to rising levels of MSC expenditure as an index of their concern for unemployment and manpower problems.6 Evidently, a Labour government anxious to demonstrate, not least to its own activists, its compassion for the unemployed and its capacity to resolve Britain’s manpower problems, did not encourage a fundamental scrutiny of MSC expenditure. It was the Thatcher government after 1979 which first highlighted the requirement of ‘value for money’. Before that era, the main goal of the MSC was to launch programmes quickly, to attempt to include training elements within them and to fund those external bodies which delivered its programmes in an apparently satisfactory method. The 1975–6 report admitted: it will never be possible to subject manpower services to tests which prove beyond all argument that they offer the best value for money. Many decisions about the scale and nature of provision will always remain ones for judgment by the Commission, the government and parliament.7 Similarly, the annual reports for 1976–7 and 1978–9 made no reference to the monitoring, propriety or cost-effectiveness of expenditures. Howells is also critical of the way in which between 1974 and 1978 ‘accountable management’ did not imply accountability to the Commission, the Secretary of State, Parliament or the public. Rather it involved internal accountability to line managers. This was not sufficient to keep the organization ‘on its toes’, and line management control of resources made it difficult to switch resources between divisions at regional levels.8 There is no doubt that the MSC became more frugal and cost- effective between 1979 and 1981 under the impact of the Thatcher government. Early in this period, the Commission decided to withold publication of its corporate plan, although it was the document in which the MSC submitted to the Secretary of State its funding plans for the next quinquennium. The House of Commons Employment Committee protested that: making the details of its intentions clear to parliament . . . is essential if the MSC is to be held accountable to parliament and to the many institutions and organizations which work closely with the MSC. At a time of rising unemployment and rigorous scrutiny of public expenditure it was a particularly insensitive decision by the MSC not to publish.9 This was an appropriate warning when the new Thatcher government was both seeking to audit public expenditure more rigorously and to question the

The MSC 1973–1981

25

utility of quangos. While Margaret Thatcher condemned quangos, her categorization was too broad. The term quango means quasi-autonomous non-governmental organization. In any event, as a high spending quango its vulnerable position should have led it to be more sensitive to political opinion. Learning the lesson, however, it ensured that all subsequent corporate plans were made available. In any event, it is proper that all public organizations be scrutinized from the standpoint of policy impact. As Burch and Wood argue, impact studies reveal whether policy is effective, gives value for money, matches outcomes to intentions and protects the principle of accountability.10 These considerations were not lost on the Commons Employment Committee which noted that the new Conservative government intended to reduce the MSC’s planned expenditure during the period after 1980, by as much as £160m. in 1980–1. The absence of downward pressure from the Treasury, and the reluctance of the DE to ask heretical questions before 1979 was replaced, therefore, by a searching scrutiny which was maintained throughout the 1980s by the new parliamentary select committees, as well as by recurrent Treasury raids upon MSC funding. It is true that before 1979 the MSC was subject to scrutiny by its own audit staff, but, in general, the internal auditors lacked the bureaucratic authority to impose financial control over such a politically sensitive area. On at least one occasion, however, the MSC’s chairman was subject to a searching cross-examination by the House of Commons Public Accounts Committee over such issues as the utilization of Skillcentre capacity and the role of the Professional and Executive Recruitment (PER) agency.11 Yet there are good reasons to support Howells’ critique of the MSC’s practice of employing external consultants for such activities as strategic planning for the TSD, reviews of specific programmes, statistical opinion surveys and other tasks better carried out in-house. If the justification for the practice was the lack of internal expertise, then Howells is justified to enquire whether MSC officials were equipped to digest the recommendations of external advisers. While other public sector bodies followed the same practice, Howells argues that external advice ‘offers no easy answer to deep-seated problems of expertise and planning’. It was also excessive for the MSC to hire Saatchi and Saatchi for £900,000 for advertising between January 1978 and March 1979.12 These problems resulted from the government’s concern to implement schemes to tackle the unemployment situation, but the consequent haste prevented adequate monitoring and inspection, and the laxity of Treasury and DE control permitted MSC expenditures which were hard to defend. But the MSC’s work between 1974 and 1979 must be evaluated as ‘crisis management’, the alternative to which was to abandon the unemployed to their fate. Further, the very conception of a ‘hived-off’ body under a Commission

26

The politics of the training market

necessitated a relatively ‘hands-off’ approach by government departments. And at least the Commission was no cipher before 1981. Accountability and independence In the period until 1981, the Commission was staffed by individuals who relished their independence, and it possessed a measure of influence after Richard O’Brien’s appointment from the private sector to chair it. Certainly, the three TUC figures in the early years, Ken Graham, Danny McGarvey and Charles Urwin, were senior trade unionists who became experts in the area of manpower policy. The CBI, local authority and education representatives developed an esprit de corps with the trade union representatives, and decisions were taken exclusively by consensus rather than vote at committee meetings. It is not suggested that the Commissioners were substantial policy-initiators since they fulfilled a reactive role, but after O’Brien’s appointment to the chair in April 1976, when the MSC began to carry out identifiable activities, he perceived his function as being to produce policies and programmes to gain the support of the Commission. That spirit also pervaded the entire organization. Equally, the Commission representatives were able to enjoy a substantial measure of independence from their principals. CBI commissioners were individuals who were barely accountable, and, while the trade unionists were formally responsible, they came under little real pressure in the initial years of the MSC. The freedom which the TUC representatives experienced was not surprising since the MSC was partly a TUC creation. Labour was in power for its first quinquennium, and policies to tackle unemployment and skills short-ages were popular with trade unionists. In short, if ever the MSC behaved as a ‘corporatist’ body, it was during the 1970s rather than the 1980s. It is probably unhelpful to refer to the MSC as ‘corporatist’, however, since, as Nevil Johnson argues, the British political culture is too individualistic to institutionalize formations such as intrusive-statist, or corporate-statist organizations. Electors are more likely to vote for strong leaders.13 The MSC was rather a matter of limited tripartism for specific purposes which served the needs of Labour in power, which was struggling to regulate a mixed economy in ways which were unattractive to many of its party members. Whether it was corporatism or merely a limited experiment in quangoism, however, even the Labour government was starting to grow impatient with the MSC’s independent autonomy, although such dissatisfaction was never overt. Even if his true position was always weaker than he imagined, and his role was never analogous to that of his Swedish and German counterparts in their national labour-market boards, O’Brien was still regarded as a national authority on manpower questions before 1979.

The MSC 1973–1981

27

The main focus of this chapter is on the evolution of national training policies under the TSA and the TSD after 1974, but since the MSC sought to make a reality the integration of employment and training services in an integrated national manpower policy, there is now a brief discussion of the work of the TSA (later TSD) and the ESA (later ESD) between 1974 and 1981. THE EMPLOYMENT SERVICES AGENCY The Employment Services Agency (ESA) was fully operational when the MSC was launched on the first day of January 1974. It continued to function until the less potent Employment Services Division (ESD) took its place in April 1978. The main achievements of the MSC’s employment services were to continue to develop the new Jobcentre network and to promote further the Professional and Executive Recruitment (PER) agency. The rationale behind these innovations, and the logic of uniting employment and training services was fully explained in government publications discussed in the last chapter. There is little doubt that the new service developed progressively after 1972 and succeeded in providing the national employment service with a newer and more attractive ‘image’ which managed to shed the older ‘dole’ office associations. As with training policy, however, the natural development of policies and practice in the employment service field was diverted and overshadowed by the high level of unemployment which emerged particularly after 1976. The MSC’s annual report for 1975–6 revealed that mounting unemployment was a national phenomenon from which only the South-East and the Midlands were exempt. This was the reason why the Commission decided at its first meeting in January 1974 to allocate extra money to the ESA, after the TUC members of the Commission had urged that the government accept the priority of bringing down unemployment.14 The main spearhead in the ESA’s plans to improve the quality and accessibility of services was the Jobcentre Programme, the numerical advance of which was impressive, as by 1979 there were 555 Jobcentres throughout the country located in High Street properties. The services which were thus made available to jobseekers included contact with employers, the provision of employment information and advice, occuptional guidance, special assistance for disabled people and access to training opportunities.15 The Jobcentres attracted a wide cross-section of the public by providing ‘selfservice’ displays of job vacancies and by persuading employers to regard the public employment service as the normal way to fill vacancies. The ESA rigorously monitored the impact of Jobcentres from the outset, and a major survey of their work from 1973 to 1977 revealed that they successfully filled vacancies more effectively than other employment service offices.16 Yet

28

The politics of the training market

Howells points out that such claims neglect that Jobcentres attracted shortterm job changers rather than the long-term unemployed. While ‘ESA undoubtedly became more efficient, it is debatable whether it also became more effective . . . in relation to market mechanisms for filling jobs’. Similar arguments can be advanced about the PER offices which made a small running profit in assisting jobseekers at the most prestigious end of the market: ‘The numbers of such jobseekers expanded with the employment shake- out of the mid 1970s’.17 A major rationale for the establishment of the MSC had been the need to integrate employment and training services since redeployment was perceived to be a necessity in a modernizing economy. The aim was to help people choose, train for, and get the right jobs and employers to get the right people as quickly as possible.18 It is difficult to assess the MSC’s effectiveness in securing training opportunities for the unemployed, but by 1978 it was claiming to have introduced new procedures for recruiting and selecting TOPS trainees so that fewer would drop out of training. The growth of special programmes The work of both the ESA and TSA was overshadowed in practice by the introduction of special programmes which provided a vigorous response to the unemployment crisis, and for that reason they were strongly supported by ministers who were worried about its social and political impact. The first major innovation was in October 1975 with the Job Creation Programme (JCP) which enabled the MSC to fund projects which provided socially useful work to people who would otherwise be unemployed. An initial grant of £30m. was awarded. The JCP was based upon the study of Canadian experience, and an important criterion before schemes could be approved was that the local community should benefit from the work undertaken. The scheme’s disadvantage was that it involved little training, and the Commission acknowledged that there was a need for improved co-ordination with the training provided by the TSA. The JCP came under the direct control of the Office of the Manpower Services Commission (MSC), thus facilitating a more direct supervision by the Commission than was feasible had the programmes been organized either by the TSA or the ESA. The main shortcomings of the JCP in the judgement of the Commission was that only 1 per cent of the projects commenced in October 1975 related to the private sector, compared to 79 per cent linked to the local authorities.19 The next special scheme was the Work-Experience Programme (WEP) launched in 1976 to encourage employer-sponsored projects, because

The MSC 1973–1981

29

the JCP had in practice mainly linked to local-authority activities. It was open to any unemployed person up to the age of nineteen, and involved a flat-rate maintenance allowance of £16 per week. The scheme did not provide jobs but rather the opportunity to learn about different kinds of work together with the chance to ‘learn by doing’ under supervision. By the end of March 1978 the Commission had approved 17,463 schemes and a total of 54,105 places for young people. WEP was aimed at young people with few or no educational qualifications, and the average length of stay was twenty-one weeks.20 Unemployment remained stubbornly high, however, despite these measures, but of greatest concern was the rise of long-term and youth unemployment. The MSC was in no sense responsible for macro-economic management and was confined, therefore, to mitigating the effects of unemployment on vulnerable groups and individuals. All the special measures after 1976 served to blur the distinction between training and work-experience, and this was particularly clear with the case of the Youth Opportunities Programme (YOPS). It was not only government ministers concerned at the political and social consequences who advocated special measures, however, since in the annual report for 1976–7 Richard O’Brien wrote to the Employment Secretary, Albert Booth, about the anxiety which high unemployment (then standing at 1.3m.) was causing. We have thought it essential to extend and refine a range of special measures to alleviate its worst effects, especially for young people [and he thanked the government for] a new programme of opportunities for young people [which] represents a more coherent and long-term approach to the problem of young people and work’.21 The main disappointment with the new special measures was that the effort, not to mention the resources, that they required ensured that they took precedence over the reorganization of the country’s training system. The aim of YOPS was not to train young people, but rather to help them improve their chances of obtaining a job. YOPS soon became notorious with the public. While it could boast the achievement of putting 1.8m. young people through work-experience during the four years of its operation from 1978 to 1982, there is no doubt that its popular standing deteriorated. From a crisis-management ethos of enabling unskilled and unemployed young people, then about 10 per cent of the total, to improve their labour-market possibilities, it rapidly became a way of keeping an army of young unemployed off the dole queues and unemployment statistics.

30

The politics of the training market

YOPS was first proposed in the summer of 1977, commenced on 1 April 1978, and became operational at the level agreed by the Commission and government on 1 September 1978.22 It was as early as 1976, at the height of the economic crisis which plagued the Labour government, that a study was commissioned into the feasibility of offering all the young unemployed either job-training or work-experience. The report of the study, Young People and Work (May 1977), proposed a large-scale programme, absorbing such small-scale DE initiatives as Community Industry, to create YOPS. Ministers added the Easter undertaking that no school leaver at Easter or Summer 1978 would remain unemployed the following Easter without the offer of a YOPS place.23 The report also urged a parallel initiative for adults, the Special Temporary Employment Programme (STEP). So significant were these new initiatives, especially YOPS, that they provoked organizational changes within the MSC. O’Brien summarized them with the argument that: ‘the Commission has been brought together as a single body under unified management, with three operating divisions to run the employment service, the training services and our special programmes to assist unemployed people’.24 Thus the Special Programmes Division (SPD) was created to run both YOPS and STEP, which were the complete replacements for both the JCP and the WEP programmes by the end of 1978. YOPS was the larger programme since even at this early stage in its development it catered for 234,000 youths in a full year, while STEP offered the unemployed over nineteen only 25,000 jobs.25 From the outset there were seven different types of scheme, three of which trained and prepared young people for work, and four offered workexperience. In the first category were assessment and employment induction courses of two weeks’ duration, located mainly in employers’ establishments and leading chiefly to basic-skills courses. These were short instructional courses of thirteen weeks’ duration located at TSD skillcentres, colleges of further education and employers’ establishments, leading to preparatory courses of undefined length in colleges for employment opportunities. In the second category were work-experience programmes on the employers’ premises together with training workshops, community-service programmes and project-based initiatives. These opportunities varied in their objectives, but they ranged from specific and broad-based training on the one hand to mere introductions to work and direct work-experience on the other.26 A large number of young people participated in YOPS, up to 160,000 entrants in 1978–9. This growth in YOPS continued in the early Thatcher years as youth unemployment worsened, and in 1983 more than half of all school leavers were entering it. The unsatisfactorily ad hoc nature of the scheme became clear, however, since:

The MSC 1973–1981

31

whereas about 70 per cent of ex-YOP trainees found jobs in the early days, the figure was nearer one in three towards the end of the programme’s life. YOPS fast became an end in itself, rather than vocational preparation for a real job. Most YOPS graduates went straight back on to the unemployment register.27 The training content of YOPS steadily deteriorated with time. This was ironic, as it was the Conservative supporters such as Lord Vaizey who had been critical of YOPS under the Labour government in 1979, but the same crises led the Thatcher government to continue with the established policies of the MSC. Vaizey argued in 1977 that various special employment programmes were a poor substitute for a macro-economic policy which created growth and genuine employment. This was Margaret Thatcher’s assertion in the succeeding general election campaign when she urged the creation of ‘real jobs’. Academic analysts also concurred with such sentiments: ‘As a nation we seem to believe that a collection of tactical initiatives added together equals a total strategy.’28 While the curious combination of make-work schemes, training, workexperience and employment subsidies characteristic of the special programmes was scarcely any help to the long-standing British problem of inadequate industrial training and related skills bottlenecks, it related to a new elite consensus about the shortcomings of the education provided in schools, and the emerging demand for ‘a new vocationalism’ and the reform of the ‘school–work interface’. This new preoccupation was reflected in the Ruskin College speech of James Callaghan in 1976 which inaugurated the Labour government’s great debate about the need to produce school leavers geared up for the needs of employers. The growth of special programmes had not been foreseen in 1972 when the decision was taken to establish the MSC, and it was undoubtedly a case of crisis management. Yet such was the nature of the crisis in a society which had apparently developed a consensus about full employment, that the Commission decided to create a Special Programmes Division (SPD) in 1978 to administer the new schemes. After a difficult period of rather public debate both inside and outside the Commission, the SPD chose to create its own system of thirty-one offices absorbing the JCP and the WEP networks, as well as one national and twenty-eight area boards to represent external interests and to review budgets. The administration consisted of the funding of sponsors, and the indirect nature of this work kept the number of SPD staff low, less than a thousand in March 1979, out of 27,000 as a whole.29

32

The politics of the training market

The Training Services Agency It is the case that the TSA’s (and, after 1978, the TSD’s) activities were overshadowed by the emergency special programmes. This was clearly to be regretted, because the MSC had aimed to improve the overall standard of industrial training. The problem was exacerbated by the fact that it was those parts of industry which had enjoyed the best record of apprenticeship training which were in decline. Yet the Commission was well placed to respond to the growing concern with the reform of the school–work transition, and was happy to collaborate in the preparation of a joint government/MSC consultative document, in response to its own 1975 proposal in Vocational Preparation for Young People that employers be refunded part or all of the cost of the first year of off-the-job training for certain transferable skills. This was a measure which required collective public funding. The MSC decided to urge such a policy in order to ‘increase the numbers recruited into long-term training and to stabilise the rate of entry into trades vital to the economy’.30 The joint government/MSC document, Training for Vital Skills, was published in 1976. It proposed a rather different form of funding from that operated by the levy/grant system of the ITBs, but it did urge collective funding of first-year trainees in industry. This was a response to the tendency of employers to train only for the needs of individual firms rather than for the needs of industry as a whole. Training for Vital Skills argued that industry and government should agree on longterm industrial needs and provide the financial support to ensure that they were met by contributing to a collective fund to pay for all or part of initial training in ‘transferable skills’. The recruitment targets for each year would be related to long-term national needs, and the incentive to employers to recruit the right numbers would come through payments from the fund.31 The MSC also intended to address the plight of 300,000 young people each year who took jobs involving little or no training.32 Many who commented on the document were not convinced that it took account of non-training factors. The government and the Commission concluded, therefore, that it would be better to re-examine the problem by setting up a further task group, representing the CBI, the TUC, the education service and the ITBs.33 This example demonstrates the consensual and voluntary approach to training preferred by commissioners and government alike, and the continuing capacity of the two sides of industry to impede real progress. The new task group recognized the urgent need for improved training provision for employees but considered that this was more likely to be achieved by agreement than by legislation. The Commission proceeded to implement the task group’s proposals by initiating work:

The MSC 1973–1981

33

industry by industry through the Industrial Training Boards and other appropriate bodies to assess the future need for skilled manpower; to ensure that action is taken so that there is sufficient skilled manpower training to meet this need and to establish what help will need to be given by ITBs and other bodies, and the Commission, where it is shown that such assistance is required.34 The MSC’s chairman considered that this outcome represented a considerable advance in both youth and adult training, but it marked a return to voluntarism and still failed to consider the issue of what could be done to compel recalcitrant employers to make a contribution to national training needs. The task group’s justification for jettisoning the principle of collective funding for first-year training for employees in generic skills was that other factors – such as legislation, industrial-relations problems, the organization of work and the transition from school to employment – also prevented the right person filling the right vacancy at the right place and time. While it may be true that other labour-market factors were also the cause of skills shortages in British industry – such as the inflexible utilization of employees – these were used as pretexts to justify a failure to invest adequately in the training of recruits. It is difficult to avoid the conclusion that the task group’s report, Training for Skills, like the Carr report in the 1950s, was a defence of particular interests rather than a solution to national economic problems. This was the more surprising since the report perceived the comparative inadequacy of British youth training. It cited the Swedish example where 85 per cent of sixteen-year-old school leavers in comprehensive sixth-form colleges went on to receive further education or training, and highlighted the far greater progress achieved in Germany and France.35 The report acknowledged ‘a widespread consensus of aims’, and reflected the more liberal and consensual practices which persisted in the mid-1970s. It advocated, for example, that training should satisfy both the needs of industry and individuals, and urged that schemes of training and related further education should take full account of how they are to apply both to young people and adults, whether or not they are in employment. The task group was also at pains to ensure that the numbers trained would be the result of agreement between employers and trade unions, and that organizations should be required to demonstrate that they have systematically analysed both training and manpower needs. There was also agreement to support the then Labour government’s industrial strategy, and to maintain a close dialogue between the MSC and the ITBs. But the most striking conclusion was the request for financial support from both the Exchequer and the MSC itself. It is likely, despite the consensus of aims, that it was employers who had most effectively resisted the proposals for collective funding and training contracts

34

The politics of the training market

between companies and the MSC. Sarah Vickerstaff is quite correct to argue that the task group’s report revealed the MSC to be ‘doing in abundance what it was singularly well placed to do: produce detailed plans and schemes, set up working parties, but in practice introduce ad hoc, pragmatic measures’.36 This was why industry’s practice was not challenged, and that while state expenditure on training was increased, there was no fundamental restructuring of industry’s behaviour. State support, however, had never been greater. General financial support to industry began in July 1975 following a joint TSA/ITB study and was subsequently extended both through the board and non-board sectors of industry. So great was the impact of recession on youth-training opportunities that the scope of support was extended beyond apprenticeships to cover a wide range of training in manual and nonmanual occupations. The government endorsed the MSC’s activities in this area to help ensure an adequately trained labour force ready for economic recovery, and to help preserve temporarily under-used training facilities that may be required in the future. The MSC applied these policies through the established consensual channels of the ITBs, and provided premium grants to help employ and train for recruitment in excess of a ‘norm’ agreed within each industry, provided the total training period was not less than two years and included both off-the-job training and further education. The employer had also to agree to complete the full period of apprenticeship and training.37 The extent to which these innovations can be credited to the MSC rather than the ITBs is debatable, since the TSD argued in 1978 that its support programmes were a part of the ITBs’ continuing strategy. In any event, the norm to which the premium grants were geared reflected the normal level of recruitment to an industry which employers could reasonably be expected to maintain in the prevailing circumstances, without any douceurs. The administration of the grants was left to the individual ITBs, and so the TSD possessed incomplete information. Government grants towards the costs incurred by ITBs peaked at £55m. in 1975–6 and fell back a little thereafter, but the European Social Fund (ESF) reimbursed the Exchequer and the ITBs for part of the expenditure. About 140,000 trainees were subsidized by these methods between 1975 and 1979. After 1979 the ‘consensual’ proposals which emanated from Training for Skills superseded the temporary measures. It is unclear whether this initiative intensified the training effort and removed the manpower bottlenecks as was intended, since its voluntaristic character was necessarily more difficult to monitor. Potentially the most significant development in the MSC’s early years was its strategic review of the range of its responsibilities. This marked the consummation of the planning role which it had been conceived to carry

The MSC 1973–1981

35

out, and which had been impeded by the bifurcation into the TSA and the ESA. The document Towards a Comprehensive Manpower Planning Policy was the fruit of the review, and as the Commission’s work it implied no commitment by government. The Commission was ready to engage in lateral thinking when it stated that there was no list of extra manpower measures to transform existing programmes into a comprehensive manpower policy, because a whole new attitude was required towards ‘the country’s most valuable asset’.38 The consensual approach to politics was reiterated when the report emphasized the need to secure the commitment of the ‘major interests concerned, and particularly employers’ organizations and trade unions in the work of the central manpower authority’.39 This approach was endemic in the MSC’s structure, but it also reflected O’Brien’s conception of his role as one of formulating policies which the Commissioners would accept. This is noteworthy because of the change in policy-making style under his successors, and its indication that the MSC without DE promptings was continuing to represent the ‘major interests’ rather than some higher conception of national well-being. The document Towards a Comprehensive Manpower Planning Policy did assert, however, that in a dynamic labour market the formulation of the Commission’s policies depended upon detailed manpower forecasting, and considered that this was feasible at both company and national level. It differentiated three relevant time-scales for such forms of planning. These were eighteen months for short-term special measures, four to five years for new developments in the labour force (which may require a new strategic direction for the MSC) and ten to fifteen years to involve judgements about the general framework of society. Clearly, the Commission considered its role to be supportive and catalytic rather than directive, since it conceived that its services ‘must be directed towards helping individuals and firms to meet their own responsibilities’ when it stressed that ‘it cannot itself create permanent jobs on a large scale, and if unemployment remains higher than in the past there will be more individuals on the register who will require help’.40 The main service which the report wished to see improved was that of manpower information. This was in order to provide a basis on which the MSC and the agencies could plan by identifying needs to suggest priorities, and to illuminate the background against which the Commission could improve the effectiveness of its policies. The main development required at the national level of the MSC was the improvement of the links between the various agencies and the district manpower committees which represented trade unions, employers and national interests. Also, at national level, the report stressed the need for better labour-market intelligence, monitoring and evaluation of its programmes and improved overall planning by closer

36

The politics of the training market

co-ordination between the Office of the Manpower Services Commission (OMSC) and the agencies. The MSC may have been engaged in extending planning into new fields, but it stressed its similarity to such tripartite bodies as the Health and Safety Commission (HSC) and the Advisory Conciliation and Arbitration Service (ACAS) in its relations with government. Further, ‘the Commission agreed to its budget being established by government’, and ‘because the Commission’s staff are civil servants . . . [ministers] have statutory power to control their numbers’. Yet the Commission was clearly bidding for greater independence, when its report urged that: ‘it would be helpful to the Commission if the government exercised control through the agreement of overall financial budgets and programmes, and refrained from singling out staff from other resources for special control’.41 In conclusion, the report also welcomed the removal of the MSC to Sheffield. The report’s most revealing part occurred when it both acknowledged the essentially ‘incrementalist’ nature of MSC activities, and yet perceived the need for far greater vigour if it was ever to resolve Britain’s manpower problems. While accepting that ‘it is important for the Commission to go for the most appropriate solution to each problem as it arises, and that it is difficult to reverse or even modify some decisions once taken by the Commission’, the report also hoped that the MSC would achieve a general improvement in its capacity to respond more quickly to problems and events.42 Even the aspiration for a quicker responsiveness to problems, however, left it operating within a reactive ‘crisis management’ mode. The TSA was probably best known to the public during this period for its continuation of the TOPS scheme. For a few months during 1974 the TSA had to depend on the ESA to deal with training applications because of the inadequacy of its own local network. Yet it remained responsible for the scheme. This was why it was decided to establish a new and separate network of TSA district offices, which reached forty by 1977. From a public administration perspective this duplication of administrative networks can be criticized. As Howells put it: ‘in the heady atmosphere of 1974–5 it was logical for those responsible for TOPS to seek an independent executive capacity. . . . Without very careful planning, however, substantial diseconomies could and did arise’.43 Five years after the TSD had taken over the management of the TOPS scheme, the Commission still considered it to be a cost-effective way of meeting both skill and individual needs.44 Table 2.1 shows the growth in the TOPS scheme from 1974 to 1979. This expansion concealed a shift in the balance of training. Before 1974 most training took place in Skillcentres in such manual craft occupations as motor mechanic, but as the Skillcentres grew in number the main expansion area was in clerical and commercial training as well as in computer skills. Since many of these courses developed

The MSC 1973–1981

37

in colleges of further education, it was the Local Education Authorities (LEAs) who were the main beneficiaries; and so at this stage it was relatively easy for the MSC to build reasonably amicable relations with both LEAs and educators. As Howells put it: ‘since TOPS fee payments totalled about £50m. in 1978–79, a large number of public and private trainers developed an interest in maintaining TOPS at its expanded levels’.45 One HMI has described the TOPS scheme as the most generously funded programme of liberal adult education in British history, and it is true that the non-specific parts of the curriculum were extensive. Despite its expensiveness, as late as 1979, the MSC still upheld the importance of TOPS in its plans for the five years up to 1984. Yet the first sign of a re-evaluation was emerging, suggesting that it was going to have to become more cost-effective. The MSC’s review and plan for 1978 recommended that TOPS should be developed in a closer relationship with the labour market, and that there should be greater stress on the placing and induction of TOPS’ trainees into employment.46 Generally, however, the TSD appeared by the end of the Callaghan government in 1979 to have imbibed the voluntarist philosophy of the Training for Skills task group. One report argued that industrial training could be left mainly to the ITBs, which covered a third of the employed population, but added: ‘each industry can progress in the way best suited to individual needs and circumstances, with a minimum of central direction from statutory authorities’.47 Organizationally, of course, the MSC was well equipped to cope with industrial training, both in the statutory and non-statutory sectors, through its Industry Division. However, despite the ITBs’ continuation, there was little evidence of an enhancement of their existing grant/levy/exemption strategy; and the MSC, despite its trade union membership – which in 1978 comprised Ken Graham (Assistant General Secretary of the TUC), Charles Urwin (Transport and General Workers Union) and Jim McGougan (National Union of Tailors and Garment Workers) – remained stubbornly gradualist in its training strategy. It also operated in a framework of existing industrial Table 2.1 Growth in the Training Opportunities Scheme (TOPS), 1974–9

Source: MSC Annual Report, 1978–9. Annex 3 and Appropriation Accounts-HC (78-79-138)

38

The politics of the training market

society and anticipated few of the consequences of the contemporary technological revolution, or the emergence of post-Fordism. This was evident when it expressed scepticism about whether the technological developments which resulted from microprocessors would lead to future unemployment. It asserted that: the commission does not regard with favour suggestions that people should now be educated or trained for unemployment . . . The task is rather to train and educate individuals for a working life in which they will have to cope with change.48 The Commission was patently unaffected by the then fashionable arguments about the finite limits to growth, and the vogue for ‘green’ politics. The greater responsiveness of the electorate at large to the politics of materialism was also signalled by the handsome election victory secured by Margaret Thatcher’s Conservative Party in May 1979. The MSC in the early years of Thatcherism: a new era of uncertainty A few months after the Thatcher government came to power, the MSC was demonstrating a dearth of creativity, yet, given the problems of economic decline and rising unemployment, changes in policy were clearly indicated. The first priority of the new government, however, was the cutting of public expenditure, and the initial wave of cuts to affect the MSC occurred in June 1979.49 Since the government was also committed to the principle of ‘rolling back the state’, the MSC’s future was in doubt. The uncertainty was also fuelled by the MSC’s own review of the 1973 Act, which clearly encouraged radical thought on the delivery of training and manpower policies. Its report, Outlook on Training, was published in 1980, and it recommended ideas which later found fruition in the New Training Initiative (NTI) of 1981: for example, the advocacy of adult training and retraining and the challenge to the traditional ‘skills ownership’ assumption of apprenticeships. While the emphasis upon adult needs was a radical posture, it was ideologically attractive to Thatcherite free-market principles, as was the proposal for a higher levy by the ITBs in order to return the costs of operating the ITBs to industry itself.50 In fact, the overall impression of the report was that little adult training had developed, fewer apprentices were being recruited, restrictive practices were continuing and there was a particular shortage of specialized skills such as computing and engineering. The report drew consolation from the growth of newer and flexible ideas about training and the increasing recognition by employers that there was a major underutilization of skilled workers.51

The MSC 1973–1981

39

The MSC was unable to portray itself as an unquestioned success at this time, however, but its self-criticism helped promote a more radical approach, as was revealed by the CBI’s willingness to reform the apprenticeship system and to modify the old apprenticeship idea of ‘skills ownership’.52 Further, the government’s decision to set up the Open Tech to promote adult updating reflected the MSC’s success in convincing policy-makers of the importance of adult training and retraining. However, the MSC was on sufferance in the early years of the Thatcher government, as ministers considered the wisdom of abolishing it, in line with their animus against interventionist, tripartite and costly organizations. The MSC’s later utility to government was not perceived from 1979 to 1981. The first report of the newly established Employment Committee of the House of Commons revealed hostility by backbenchers and even government ministers. The committee’s first report in 1979 described the MSC’s decision to replace its previous review and plan documents with two publications: a corporate plan and a manpower review. Yet the MSC’s decision not to publish its corporate plan led to strong strictures from the parliamentary committee and to the reversal of the MSC’s decision.53 It was clumsy of the Commission to imply that the MSC was not accountable to parliament, especially when both its expenditure and its very survival were coming under such close scrutiny. After the plan was published, however, the committee still considered that it provided an unsatisfactory discussion of policy issues and options. If the MSC’s tripartite status was still leading it to behave in an arrogant and quasi-corporatist fashion, ministerial and parliamentary suspicion soon compelled it to realize that it could not neglect parliamentary and public scrutiny. This further undermines attempts to portray the MSC as a corporatist institution. Furthermore, if ever it had such pretensions, the absence of a corporatist environment in British politics punctured any such tendencies. The Employment Committee’s report circumscribed the MSC’s power closely when it asserted both that the MSC’s work ‘represents a palliative and not a cure for unemployment’, and that ‘the level of unemployment is determined by the general level of economic activity which falls within the sphere of other departments’.54 Slightly to the contrary, however, the committee also recognized that, since the MSC had to make assessments about future employment prospects, a body with its responsibilities needed access to Treasury forecasts as well as to the underlying assumptions on which they were based. The report recognized that government was requiring the MSC to save £160m. in 1980–1 and staff savings of 12.9 per cent by 1984, and noted the Commission’s judgement that this involved a poorer provision of services.55 It also noted O’Brien’s fear

40

The politics of the training market

that the MSC would be unable to meet its obligations.56 Yet the report’s conclusion was that the MSC should postpone its plan to modernize the employment services further with more Jobcentres, and that, with employment opportunities deteriorating, the MSC should concentrate upon its training and work-experience activities with the unemployed. This foreshadowed the decision of the late 1980s to remove employment responsibilities from the Commission, and further entrenched the endemic error of confusing training with short-term palliatives to deal with unemployment. Yet the committee felt unable to advise the Secretary of State on the matter on which he had ominously sought their opinion, that of the MSC’s very survival. The MSC was in a dilemma. The government wanted it to function more economically, the Commission wished to develop its employment and training as well as its special programmes activities, and the Commons Employment Committee, which under the Norman St John Stevas reforms had acquired some prestige, wished it to emphasize its work with the unemployed. The MSC’s survival was therefore in doubt at the time when it was made subject to conflicting demands. Naturally, the Employment Committee had a Conservative majority, and its own prescriptions were a combination of Thatcherite labour-market theory and a cross-partisan concern at the inadequacy of Britain’s training record: We are concerned about the quality of training, and in particular the decline in apprenticeship opportunities, the very high number of people who receive little or no training, and the continuing problem of skills shortages. Despite the increased emphasis by successive governments on training since the mid-1960s, certain basic and fundamental problems remain. We are ourselves conducting a long-term investigation into skills shortages which will include an examination of whether rates of pay for apprentices are so near to those for craftsmen as to deter employers from offering apprenticeships.57 The idea that young people were pricing themselves out of jobs was a principle dear to Thatcherites and was an explicit problem which low YTS allowances was intended to alter. The tone of the committee was rather different on the principle of voluntarism, however, although the MSC’s own task group had appeared to endorse it. Its view was that ‘the Commission’s [skills programme] with its heavy reliance upon seeking change through persuasion has not made any noticeable progress and frankly does not inspire confidence’.58 If the motive was to criticize the MSC, this particular comment was incompatible with Thatcherite ideas about market solutions.

The MSC 1973–1981

41

The Employment Committee’s overall comment was that although the Commission has been forced to introduce new programmes to help alleviate the worst effects of unemployment, perhaps ultimately its most basic task, and arguably, that by which it will be judged, is the progress the MSC can help bring about in reforming training arrangements in this country.59 Twelve years later the same applies to the Training and Enterprise Councils. Other comments in the parliamentary report proved to be prophetic about future changes in policy towards the MSC. First, the report welcomed the fact that the Commission was reviewing TOPS in order to relate it more closely to labour market needs. Second, and in anticipation of the Audit Commission’s report of 1987, it attacked the MSC’s corporate plan for failing to discuss: possible options for achieving savings . . . For example, it might be sensible to provide more training places through private and public sector training institutions; the conversion of empty factories for training might be cheaper than the construction of purpose built Skill Centres.60 The Commission also furnished the committee with evidence on other matters. It informed the committee chairman, for example, that the Rayner cost-cutting exercise on efficiency and economy in governmental expenditure had led to recommendations concerning the rationalization of the Skillcentre network and the system of allowances, which were currently under investigation. The diminishing status of the Commission was signalled by its written response: The Commission was not consulted on the level of staff and expenditure reductions, but it has been able to discuss them with the Secretary of State before any decisions have been made, and given full opportunity to express its views. The Secretary of State has in turn expressed his views on the direction of the Commission’s programme, but the Commission has been free to determine where the expenditure and the staff reductions should fall.61 The MSC’s chairman also appeared cautious in his public comments about the effects of the staffing and budgetary cuts which the Thatcher government imposed in 1979. The organization’s growing confidence since its 1976 document Towards a Comprehensive Manpower Planning Policy was ceasing, when O’Brien asserted that cuts in resources led the MSC to:

42

The politics of the training market

concentrate our efforts where it is most needed, but cuts in staff must mean some cuts in services. But we shall cut overheads much harder than front-line services, and where front-line services are affected the changes will as far as possible minimise the effects for our clients.62 O’Brien was much criticized by the committee. Conservatives complained about the Commission’s reluctance to publish its corporate plan, although there was evidence that the decision had originally been taken out of deference to the government. It was disputable whether this was because the Commission did not want to make assumptions about the government’s future public expenditure plans, or, as Labour members suspected, that the government would not accept that the Commission’s projections about unemployment were as acute as its own more optimistic predictions. Members of both parties criticized the MSC from different directions. Labour members were alarmed that the MSC was enduring excessive cuts imposed by government, whereas Conservative members protested that too much was being made of the significance of the cutbacks, and that the MSC should investigate the possibilities of utilizing greater private training provision. Some Conservatives also argued that the Commission was exaggerating the likely growth in youth unemployment; but that even if they were proved correct, it might be possible to fund an expansion of YOPS places by cutting back the funding provided by the MSC to the ITBs, which were still unpopular with the smaller firms. Some members even discredited YOPS by referring to the more infamous of the schemes, such as the cleansing of Sunderland beach and the counting of lamposts in Sheffield; and others argued that a YOPS placement leading only to more time on the ‘dole’ was of limited value.63 O’Brien also looked towards aspects which later materialized in the NTI when he stressed the need to increase the investment in adult training and retraining, and expressed a concern about apprenticeships: The present policy is that training should be the responsibility of firms themselves and that public provision for training should come in at the margin and so we are always careful to try both to promote a proper intake of apprentices by various industries at levels adequate to those industries but not to do so in such a way as would inject public money into a situation which we consider is really the responsibility of the employer.64 In this remark O’Brien demonstrated that the MSC was still committed to a broadly voluntarist approach to training, and that the MSC was ready to tackle the flaws in apprenticeships.

The MSC 1973–1981

43

The fact is that apprentice training is lengthy and therefore it is expensive and that raises very important questions about the reform of training in Britain, questions which we need to address ourselves to as a matter of urgency. Since it is costly, firms are tempted to cut back on it.65 It appears from O’Brien’s remarks that he took an over-optimistic view about the MSC’s possible role, perhaps confusing the MSC’s position with that enjoyed by labour-market organizations on the Continent. He foresaw: facilitating not merely changes in the working of the labour market but the smooth running of the labour market . . . I do not think that we are any sort of overhead. I think manpower service is crucial to a modern industrial society like our own and should not be as any kind of optional extra. There have been two different kinds of solutions adopted in two countries I happen to have visited. In Sweden they have tackled this question by an enormous injection of state money and resources. On the other side, in Germany – and I have just come back – they rest essentially upon employers and the support of employers in regard to training matters in particular, so there are two very different approaches.66 The Secretary of State for Employment at the time was James Prior, and he offered a personal evaluation of the MSC’s performance. He considered the MSC to be unfortunate in the moment of its emergence because circumstances led it to neglect the aim of co-ordinating manpower policies in order to concentrate upon special employment measures. At the same time he regarded training policy to be inadequate as was evident from the grave shortage of skilled men, despite the best efforts of the MSC and the expenditure of money by industry. This partial endorsement did not satisfy all Conservative members of the Employment Committee, one of whom urged that the review of the MSC should be carried out by an external body. Prior’s response to the committee’s questionings revealed that he remained a consensual, moderate Conservative, and helps understand why he did not remain long in the post and was sent to Northern Ireland. He suggested that the CBI, TUC, educators and local authorities should all make an input into the MSC’s deliberative process as was his own department. But John Gorst MP expressed the view that was far closer to Margaret Thatcher’s own position. He asked the Secretary of State to eliminate the MSC and to take back its valuable activities to the DE, a step which would ensure greater accountability to parliament. When Prior responded with the comment that tripartism had merit, and urged that the expertise of the MSC should be challenged from outside in the interests of open government, Gorst reiterated that the DE should control policy. Prior adhered to the value of continuing the policies of previous

44

The politics of the training market

governments, however, and of receiving quality advice from the Commission. He followed this advice in practice by having frequent meetings with the chairman and chief executive of the MSC, and by meeting the entire Commission four times a year. One Conservative member of the committee urged that the DE should review the MSC, but Prior responded that it made little difference who actually undertook the review since a broad range of external bodies would be making submissions, and so the outcome was likely to be little different.67 There is abundant evidence, therefore, that the MSC was very unpopular with many Conservative MPs who considered it to be an extravagant legacy of a more bureaucratic and statist era; so it was fortunate for the MSC that the then Secretary of State defended it as being compatible with his own personal political philosophy. James Prior’s patronage was insufficient a year later, however, to prevent the imposition of further cuts in the MSC’s budget. It was not that the MSC was unique in this respect, but that the ever mounting unemployment figures, which were now in excess of two million and rising, made increasing demands upon the MSC’s special measures and training budgets. It is worth noting that, despite the Commission’s pride in the modernization of the employment services, at a moment of crisis it decided to cut them rather than its training and special programme activities. Ominously for the MSC, however, at this time the Prime Minister reshuffled the junior team at the DE to replace the moderates, James Lestor and Patrick Mayhew, with the more right-wing David Waddington and Peter Morisson.68 The final outcome of the MSC’s review of the workings of the 1973 Act, which was the source of the MSC, led to the publication of Outlook on Training. Its main argument was that the root of Britain’s training problem was the poor utilization of labour. Many of the assumed skills shortages were not in fact the result of training inadequacies, but rather of the underutilization of skilled labour (with many trained workers employed in jobs requiring little skill), the maintenance of craft status for work which no longer merited it and the poor mobility of labour.69 The report also called, in conflict with government ideology, for the removal of statutory limits upon the levy that the ITBs could raise, but more orthodoxly called for the reform of apprenticeships to challenge the traditional ‘skills ownership’ conception. More innovatively, but without political contentiousness, it urged that adult training and retraining should become an accepted part of general industrial training.70 These ideas were ultimately worked through in the NTI. Employers quickly began to take up the issue of the reform of apprenticeships, however, for which there was an objective case. The increased concern with adult training was symbolized by the announcement of a new approach to adult retraining at technician level, to upgrade the skills of employed adults. This was the Open Tech which was to be based upon the development of learning

The MSC 1973–1981

45

packages, by institutions other than Open Tech itself, through which adults would have the capacity to work at their own pace and in private. Whether these developments would have convinced a sceptical Conservative government to persevere with the MSC is a matter of conjecture, since political and social events in July 1981 served to persuade the government to retain it, despite internal party doubts. These doubts ran deep, and even James Prior argued that the Labour government had given the MSC more money than it knew sensibly how to spend. In July 1981 the urban riots involving youths took place in a number of British cities; and, concerned about political and social discontent, the government turned its attention to the issue of youth unemployment as a matter of urgency. It was at this time that the MSC and the National Economic Development Office (NEDO) produced a joint paper outlining a fresh approach to youth training, the effect of which was to convert special programmes into positive training schemes. Two ministers armed with this document argued for the implementation of this scheme by the MSC. They were James Prior at Employment and John Nott at Industry. The moment was propitious, the cabinet agreed, YOP was given further money and the government announced its intention to develop a new youth programme. Yet neither the MSC nor the chairman were to be given a free hand, and the Conservative party animus against some aspects of the MSC’s training role was soon made apparent. In November 1981 the government announced that fifteen of the twenty-three ITBs were to be abolished despite contrary advice by the Commission. The CBI and the TUC were also displeased, and O’Brien can scarcely have been delighted because he had just been arguing that a reliance upon the free market would produce ‘a deficiency in the quality and quantity of training’.71 The MSC’s NTI was published in a White Paper in 1981, and it contained three main features; the conversion of YOPS into a youth training scheme, the development of an Adult Training Strategy to build upon the Open Tech, and the reform of the apprenticeship system to take effect from 1985. While the proclaiming of these goals represented a major reorientation of the MSC’s activities, it is also evident that there had been incremental progress in these directions over a couple of years, except that YTS was an elaboration of YOPS, conceived rapidly in the aftermath of the city riots. While the emphasis upon adults was long overdue, Sheldrake and Vickerstaff are correct to be critical of the implicit shift of resources away from skills training to special youth provision. Once again a special programme concerned with crisis management had taken precedence over a proper national skills training initiative.72

46

The politics of the training market

CONCLUSION The MSC was struggling against difficult odds in trying to transform training between 1974 and 1981. At the beginning of the period it proved difficult for the Commission to promote training comprehensively in relationship to a national manpower plan, because of the entrenched nature of the TSA, ESA and the TOPS programme. Then, in 1976, when it acquired the leadership, political support and administrative structures to embark upon a comprehensive state-led programme to transform the efficiency of Britain’s training programme, it was overwhelmed by the dominant need to respond to the crisis of mounting unemployment by developing a set of special measures. The measures did not always provide the MSC with a favourable political and public image, and they were often caricatured (as in the Sheffield and Sunderland examples already mentioned). By the time the Thatcher government came to power, however, the MSC had acquired the potential to tackle training and employment policies in tandem, as it had originally been created to do. The Commission had become more influential, its procedures were primarily consensual in character, its regional structures to deliver programmes were in place, and in O’Brien the MSC possessed a vigorous chairman who conceived himself as an expert in manpower problems. Unfortunately this was the moment when it had to absorb public expenditure cuts in line with the government’s monetarist strategy, as well as to resist a free-market government’s conviction that statist and neo-corporatist approaches had little merit. The Labour government was content to allow the allocation of budgets to be influenced by commissioners responsive to the two sides of industry. While it was sufficiently committed to planning to favour publicly-led provision, Labour was in no way averse to protecting the traditional role which unions and employers exercised over the content of training. The Thatcher government promulgated a different but still paradoxical approach. It rejected state-led solutions in principle, but in its anxiety to create the conditions in which the labour market could operate in a suitably deregulated manner, it saw merit in utilising MSC initiatives to alter the nature, content and funding of training. This was apparent in its support for the Training for Skills Programme set up in 1979–80 which offered grants to sponsor the first year of apprenticeship training, provided MSC criteria were met. A quarter of a million places were filled in this manner in 1980, giving the MSC the chance to influence the form and content of apprenticeships.73 The fuller reform of the system of apprenticeships, however, had to wait for the implementation of the NTI between 1981 and 1985. The seriousness of the legacy of British training in 1973 was such that the MSC was unable to remedy it effectively. The problem was not merely to

The MSC 1973–1981

47

increase the quantity of training but also to improve its standard and costeffectiveness. Each of the two party governments were impeded by ideological obstacles. Labour’s acceptance of voluntarism failed to transform training provision, and Conservative faith in the market and self-financing provision failed to increase its quantity. Clearly, much was required of the NTI in resolving long-standing deficiencies in Britain’s training provision. While it was necessary to persaude the two sides of industry to collaborate fully in any new system, there was overwhelming evidence that, left to their own devices, they would be incapable of resolving the crisis. In 1980 a Central Policy Review Staff (CPRS) paper had recognized: the view of successive governments that unions and employers are best placed to analyse the training needs of their own industry. It is a view which we believe needs to be modified, since ITBs reflect the interests of some unions and management, in preserving traditional systems of training, rather than the longer term needs of the economy as a whole.74 Articles by contributors to Management Today at this time confirmed these judgements.75 Yet the NTI partly reflected a return to the voluntary system, after a brief period of ITB and MSC interventionism. Industry was expected to reform its training traditions by renegotiating the terms of apprenticeships with the unions, as well as embracing adult retraining. Yet experience since 1976 suggested that a background of recession and unemployment diverted attention from the long-term reform of Britain’s endemic training problems to special measures to massage unemployment figures. The next chapter explores the attempt to overhaul the established training system through the NTI. The period from 1976 to 1981 proved to be the halcyon period for the Commission, and for tripartism. At national and regional level the representatives of the CBI, TUC, LEAs and the education service were able to exert some real influence over policy-making, if rather less over implementation. It is an irony that at times of expansion it is more difficult for policy-makers to control and monitor expenditure adequately. Encouraged by the Labour government, it was the trade union representatives at both national and local (area manpower board) level which took their responsibilities most seriously. Their attendance was assiduous, they were responsible to their constituent organizations while CBI representatives appeared to be free agents. The decision-making ethos of area board meetings was consensual. Even when the Commission was at its most influential, it is unconvincing to describe the MSC as ‘corporatist’ in its political role. The issue of how the MSC is to be conceptualized leaves room for debate, but it is realistic to portray the MSC as an example of a transiently fashionable

48

The politics of the training market

exercise in limited tripartism for specifically limited purposes, rather than as a corporatist institution. In any event, the tensions between a body constituted in such a tripartite fashion and enjoying generous public funding and Conservative backbenchers became apparent. It was largely mass unemployment and the patronage of a traditional Conservative minister which allowed the MSC to continue for the first two and a half years of the Thatcher government. The NTI partly reflected the ideology of the new government as well as the ‘technical’ judgments of the MSC. The appointment of Norman Tebbitt as Employment Secretary in the autumn of 1981 ensured that it was government ideological values in their purer form, rather than the preferences of the Commission, which were to determine the process of the NTI’s implementation.

3

The MSC in its glory: 1981 to 1987

Relishing its release from a period of uncertainty, the MSC developed a new lease of life after the Conservative government finally took the decision that it should continue. The first fruit of its renewed confidence was the launching of the New Training Initiative (NTI) which aimed to reform initial youth training and to inaugurate a new commitment to adult training. The unfolding of MSC schemes between 1981 and 1987 was largely concerned with the implementation of the NTI, although some additional programmes were introduced, particularly in the area of the transition from school to work. The combined impact of the MSC’s interventions led its critics to describe it as ‘imperialist’. Yet the irony of the MSC’s expansion is that it was blessed by a Conservative government which came to power with a mission to ‘roll back the state’. While the expansion of the MSC’s budgets between 1974 and 1979 under a Labour government compelled to cut costs in most areas of policy was surprising, its growing interventionism under a Conservative government devoted to the free market was an even greater anomaly. The reasons for the acceptability of the MSC to a free market government require some explanation. There was some logic in the idea of centralization in order to decentralize to the market, and this theory was well accepted by leading MSC officials. One argued that the government had first to create the conditions in which market-led training could flourish, and another referred glibly to the need for the MSC to create the necessary training infrastructure before retiring. A second official was forced to admit in 1989, however, that only the good employers appeared to be responding to the MSC’s promptings and that this was problematical for a free-market Conservative government.1 In any event, it is a curiosity that the proposition that the government was centralizing in order to decentralize to the market is uncommonly like the Marxist conception of ‘the dictatorship of the proletariat’, in which a transitionally powerful state is a necessary evil but only to create the conditions in which it can wither away. Yet such is the position of the Conservative government. As one writer puts it: ‘government control was being increased

50

The politics of the training market

in order to package responsibility for the nation’s training so that it could be passed where the government of the day believes firmly that it belongs, in employing organizations.’2 Whether it was a case of removing contradictions, or withdrawing in order to allow the training market to function, the government’s aversion to bodies such as the MSC prevailed in the autumn of 1987, when the Secretary of State announced that the MSC was to lose its employment responsibilities, to have its Commission changed to provide for employer dominance, and to undergo a hiatus before the announcement of a new chairman. This announcement marked the emergence of the Training Commission (TC). This chapter will explore the changing character of the MSC’s management and politics after 1981, and then discuss at length the Youth Training Scheme (YTS), the Technical and Vocational Education Initiative (TVEI), the development of adult retraining and updating, and certain other training, employment and enterprise initiatives. THE MANAGEMENT AND POLITICS OF THE MSC The evolution of MSC policies for training should be set within a theoretical perspective of political analysis if they are to be properly appreciated. Training policy: a brief outline The character of MSC management and politics after 1981 were shaped by an increasingly confident government which wished to use the organization to advance its own political purposes. This assertiveness was more evident after the appointment of Norman Tebbitt as Secretary of State for Employment in the autumn of 1981. While the government plainly had a distaste for quangos and for high levels of public expenditure, the MSC was needed to alleviate the crises of youth unemployment and to tackle the endemic training deficiencies of British industry. The evidence of officials appears to conflict, however, on the degree to which the government was genuinely motivated by a real desire to attack the nation’s training needs, at least at the beginning of the period. While one such official stressed that the government was merely addressing the supply-side question with a particularly vigorous attack upon the training inadequacies of the national economy so as to create the conditions for market forces to operate effectively, another claimed that it was mainly concerned with occupying the unemployed, and that it was the MSC which introduced the ‘added value’ of training to the government’s schemes.3 While motives may have altered as the 1980s progressed, and unemployment became a less salient issue on the political agenda, it appears that Atkinson and Lupton are correct

The MSC in its glory

51

to argue that despite ‘its obvious ideological distaste for such an agency, in the face of still rising levels of unemployment, the government was forced to acknowledge its political usefulness.’4 That this represented a political volte-face is clear. As leader of the opposition, Mrs Thatcher had made it clear that there should be no further creation of artificial jobs, since the nation needed new jobs in productive industry. This could be achieved by a freer market which required a weaker state. The June 1979 budget announced cuts of £170m. to the training and employment programmes administered by the Commission, and funds were further pared at the end of 1979 and the end of 1980.5 Plans to transfer the MSC’s main responsibilities to the Department of Employment (DE) were delayed, however, and despite the retrenchment, there was subsequently an expansion of activities. It was the political imperatives of massaging the unemployment figures and preserving social stability which tipped the government in favour of new programmes. The MSC’s main effort during 1981 was devoted to the production of the New Training Initiative (NTI). It was clear that while there was basic harmony between government and MSC over the NTI’s main proposals, there remained ample scope for dispute over the implementation of the initiative. The harmony was symbolized by the proximity of the contents and even title, when the subsequent White Paper was called A New Training Initiative. The implementation of the initiative was concerned with three objectives: the conversion of YOPS into an improved YTS for the young unemployed, the development of an Adult Training Strategy embracing the Open Tech, and the reform of apprenticeships. These were essentially incremental changes emerging from such stimuli as the urban riots of July 1981, the Central Policy Review Staff (CPRS) document of 1980 which urged the substantial modification of the apprenticeship system, and a growing perception that, even after the TOPS scheme, Britain was light years behind its competitors in the adult training sphere. The implementation of the policy remained contentious, however, and the hidden agenda of the NTI involved a shift in expenditure from skills training to special measures affecting the young unemployed, and a return to a voluntary system for the training of company employees. THE MSC AND THATCHERISM The politics of the MSC at this time were both fascinating and paradoxical. Margaret Thatcher had proclaimed her intention of reducing quangos and of removing tripartite bodies which evoked the era of the post-war consensus, and yet she allowed the greatest of them all to expand its power and to centralize much of the education and training systems under its

52

The politics of the training market

aegis. Writing from an ideologically unsympathetic perspective, Leisha Fullick explained why the MSC’s statist character could be exploited to accommodate the government’s ideological project. The MSC’s centralization was utilized, she asserts, to promote ‘market capitalism’, to control the labour market, to undermine local government, to control parts of the voluntary sector and to reshape society’s values with respect to work and education. 6 This view is compatible with the judgement that Thatcherism comprised the twin-track approach of ‘the free economy and the strong state’. Fullick argues that the MSC had a strategic role to play by freeing the labour market from traditional constraints in the interests of employers. Thus the MSC ‘was a drive to restructure traditional labour markets and to lower wages, particularly youth wages’.7 While it is difficult to contest Fullick’s account of the government’s manoeuvrings, its objectives were far less malevolent. The promotion of national economic competitiveness, for example, is an aim shared by all parties other than the Greens. Similarly, when Fullick condemns the MSC for sidestepping local authorities so as to ‘facilitate rapid reorganization in the face of changing objectives’, she fails to recognize that the circumstances required the management of rapid change and that LEAs were poor instruments to deliver new policies swiftly. The previous Labour government considered ‘specific grants’ to LEAs to achieve particular objectives, and Shirley Williams as Secretary of State for Education was sometimes irritated by local government; the more so after it managed to resist her ‘specific grants’ initiative. It was also the Labour government which first introduced the MSC into the education service. The new conceptions of education generated by ‘the great debate’ after 1976 are evidence that ideas of educational change had support across the political spectrum. Both Labour and Conservative were concerned to challenge Britain’s skills shortages, improve the transition between school and work, expand adult training and implement special measures to alleviate the growing youth unemployment crisis. Yet, as has already been asserted, there is little doubt that the tone and style of policy-making changed when Tebbitt was appointed as Secretary of State, replacing James Prior. The language of the post-war consensus was replaced by the rhetoric of ‘get on your bike’ after Tebbitt’s speech to the Conservative Party Conference in October 1981. The Conservative government clearly became more concerned to introduce a greater degree of political scrutiny of, and direct control over, the Commission’s activities, so as ‘to align its operations more closely with the government’s wider political and economic strategies’.8 The corollary of the general restructuring of social welfare policy at this stage in the Thatcher government’s life was the attempt to effect a central

The MSC in its glory

53

readjustment in the respective responsibilities of the state and citizen. ‘Those who remained without work . . . must accept responsibility for their own plight. The state should not support those individuals with benefits or employ them on schemes of “make work”, but help them improve their employability’.9 The role of the MSC was to prepare individuals for the world of work through a process of encouraging basic skills and motivating the individual. As a result of these developments, a common complaint among radical educators was that the shortcomings of the socio-economic system and its incapacity to educate or employ its members, were redefined as the fault of the unemployed themselves for their lack of skills and motivation for work. A crisis of the social system, so it was argued, thus became a problem of personal deficits. The MSC and the trade unions It is all the more a paradox, therefore, that the TUC continued to support the MSC under the Thatcher/Tebbitt leadership, but it was constrained to do so by history. The Conservative government skillfully exploited the TUC’s commitment to its own creation, and used a tripartite organization to drive through largely anti-consensual policies. The government’s new training and education policies were described as ‘the new vocationalism’, and in some respects conflicted with TUC policy. The history of TUC demands for a central labour-market organization since the 1960s, however, led it to remain loyal to the MSC. The Labour government had set up the YOPS scheme partly as a result of TUC pressure. Therefore, as Eversley argued: ‘the TUC has difficulty now criticising schemes like YTS which have in a sense evolved out of earlier schemes initiated by the TUC itself’.10 When Conservative backbenchers sought the MSC’s abolition after May 1979, the ‘TUC responded to this threat by defending the institution first and worrying about policy only as an afterthought’.11 Despite Tebbitt’s policies and those of the new MSC chairman, David Young (appointed in 1982 to replace Richard O’Brien), the TUC still presented the MSC as ‘our agency’, remained committed to the idea that it assisted the unemployed, and merely advocated restoring its former ‘innocence and independence’. Yet after 1981 the trade unions were acquiescing in the MSC’s transition from a strong labour-market agency committed to training and industrial regeneration to a crisis-management organization, mainly concerned in the short term with palliatives against unemployment. The dilemmas created a division among trade unionists. At the 1983 TUC Annual Conference, for example, there was an unsuccessful attempt to persuade the TUC to withdraw from the YTS, when Ken Gill of the Association of Scientific, Technical and Managerial

54

The politics of the training market

Staff (ASTMS) accused TUC commissioners of ‘lurking without intent in the corridors of power’.12 Senior MSC officials acknowledged in 1984 that the government came to value TUC participation in the Commission as a useful means of legitimation. That is not to imply, however, that the Commission was powerless in the period covered by this chapter. It undoubtedly modified policy at the margins, although it was of greater utility to government than to trade union members. Before 1987, for example, together with the education and LEA representatives, the TUC’s commissioners ensured that attention was paid to issues of childcare for adult trainees, pressed the case for provision for disadvantaged groups and ensured the creation of a special MSC unit devoted to the task. It also provided an independent voice in the preparation of the MSC’s corporate plan. The prevailing tone of the Commission’s proceedings from 1981 to 1987 had been consensual, however, both between CBI and TUC representatives as well as between the Commission as a whole and the MSC’s officials. There had been notable disagreement on only three occasions. The first is dicussed shortly and concerned the introduction of YTS Mark 1, the second concerned the issue of which groups were eligible for the Community Programme and the third was the loss of responsibility for the employment services at the end of the period. In return for this limited input into MSC outcomes, the Commission played an inestimably important role in these early years in building links with external organizations such as unions, education institutions and local authorities. Thus the bandwaggon of support for the NTI, to which the TUC had contributed, could not be reversed even when shortcomings became evident. The serious attack on LEA powers in the 1984 White Paper Training for Jobs, which directly transferred money and powers to the MSC in the realm of non-advanced further education (NAFE), also failed to shake the TUC’s commitment. TUC support was paradoxical, therefore, since it was dealing with a government which explicitly sought to weaken trade union influence while requiring its co-operation to pursue many of its important labour-market interventions. Even in the training field, the government was determined to downgrade apprenticeships and the industrial training boards (ITBs), in both of which the unions had played an active role. This policy was apparent in the 1980 CPRS report which argued that apprenticeships should be replaced by training geared to employer-defined ‘competences’.13 Eversley observed both manifest and latent functions in the Conservative policy: YTS acquired a new strategic usefulness for the Tories, in that it could directly undermine the recruitment to craft unions at the same time as it functioned as a response to youth unemployment.14

The MSC in its glory

55

Yet those elements within the labour movement opposed to TUC participation with the MSC were also blinkered in their perspective. The trade union movement had been severely weakened by such labour market changes as the decline in the older ‘smokestack’ and traditional craft-based industries, as well as by political factors such as unpopularity with the mass public and the electoral success of the Conservatives in 1979 on an anti-trade-union platform. There was a case, therefore, for trade unions to cling to whatever vestiges of power remained for them. Further, the dilemma about the benefit of pressure-group access versus the pitfall of incorporation faces all organizations with an interest in public policy. Nor should minor amendments to policy be dismissed as worthless if they would not otherwise have been achieved. It is also the case, regardless of the interests of the trade unions, that many of the CPRS and subsequently DE propositions about the modernization of training were valid. That did not prevent a plethora of leftwing criticisms of the TUC emerging, however, such as that the TUC was ‘thoroughly embroiled in the corporatist structure of the MSC which seems to welcome every new programme as an incremental advance in the progress of western civilization’.15 The argument that the TUC was exploited for purposes of legitimation does not rest on abstract argument, however, as there is strong evidence of specific cases in which the TUC and its Commissioners were manipulated. This was evident with Tebbitt’s introduction of YTS in 1981 and 1982. In December 1981 he introduced a White Paper in which it was proposed to reduce the YTS allowance to £18 a week and to make the scheme compulsory. This led to a furious row between the Secretary of State on the one hand and trade unionists, educators, members of the voluntary sector’s many employers and the MSC’s chairman Richard O’Brien on the other. This campaign by a formidable array of opponents merely produced a restoration of the terms and conditions which had characterized the YOP, and which had been considered unsatisfactory throughout the labour movement. So Tebbitt achieved the outcome that he sought, while also placing the issue of compulsion on the agenda for future reference. It is hard to contest the view that: the climb-down was hailed as a victory, even though the spectre of coercion quickly reappeared on the agenda. The White Paper did its job in deflecting the TUC from the important task of ensuring that the YTS was from the outset significantly better than the YOP . . . the actual YTS in 1985–86 is nearer to Norman Tebbitt’s proposals . . . On the proposals for a two year YTS once again the TUC was outmanouevered. It was presented as a move towards a TUC goal though in fact it was not a proposal for more training but more ‘work experience’.16

56

The politics of the training market

Yet Eversley’s far-left analysis should not be accepted in its entirety. While the DE and government operated with far greater political skill than the TUC, the most important element is that it enjoyed more political resources. Further, while the TUC’s proprietorial attitude towards the MSC was being superseded by events, the benefits of a TUC boycott are not evident. A boycott would have resulted in the TUC jettisoning its remaining influence on labour-market policy, allowed the government to portray trade unions as indifferent to the plight of unemployed youth and legitimized the progressive dismantling of tripartite structures. Clare Short, who as a front-bench spokesperson on employment matters in 1988 advocated the withdrawal of TUC support from the Employment Training (ET) programme, adopts a more realistic appraisal of the political realities of 1981–2. She argues that the DE’s victory over the Department of Education and Science (DES) in the delivery of training had occurred as early as 1978.17 She also recognizes that the DE won because ‘it could guarantee to produce places very quickly on the ground. The DES could promise much less because it would have to make grants to local education authorities and exhort them to deliver’.18 Perceiving that the MSC was a far more effective instrument for rapid policy implementation, and confronted by the political and social crisis of youth unemployment, the Thatcher government therefore, decided to retain the MSC in 1981–2 while seeking to establish a firm control over its actions. It was also fortunate in being able to invoke TUC support. The expansion of the MSC’s role: the ‘training for jobs’ furore The scale of the DE’s inter-departmental victory over the DES, on behalf of MSC, was even more clear with the publication of the White Paper Training for Jobs (Cmnd. 9135) in January 1984. This attacked LEA power directly, by proposing to transfer 25 per cent of monies allocated for the funding of further education (FE) colleges directly to the MSC Area Boards to spend as they determined, whether in colleges of FE or in the private sector. A major controversy followed with the Conservative-dominated Association of County Councils (ACC), joining with the Labour-led Association of Municipal Authorities (AMA) and the National Association of Teachers in Further and Higher Education (NATFHE) in a vigorous campaign to resist this enhancement of MSC power at LEA expense. The dispute was protracted, and the episode demonstrated both the reality of the Whitehall internal power struggle, as well as the government’s political project. The commissioners had little knowledge of what was happening, although Lord Young as chairman must have given his tacit consent to the idea. Other government ministers defended the idea in provocative terms,

The MSC in its glory

57

implying that the education service had failed the nation. Sir Keith Joseph, far from defending the LEA network, suggested that the MSC had ‘a unique ability’ to judge national training priorities. Yet Joseph’s considerable intellectual capacities were unmatched by political and administrative skills. Further, he was sympathetic to the MSC as he had belonged to the Cabinet which had set it up. The political project of the government was in harmony with the proposals in Training for Jobs because it recommended changes fully compatible with it. It implied a reduction in the powers and budgets of local authorities, enhanced market principles with the MSC as a customer subject to the wishes of the government, and it nominated further education as a scapegoat for the long-standing failures of governments of both parties in education and training policy. This tendency is revealed by a nonapocryphal anecdote from the period, in which Sir Keith at a conference actually expressed the wish that FE colleges would function in the evening. Civil Servants also argued that FE colleges had failed to address the needs of young people and industry, but when challenged they tended to retreat to bland statements that the performance of colleges was ‘patchy’. MSC officials were concerned at the growing unpopularity of their organization during this episode, which was evident among adult educators, FE colleges and other members of the continuing education and training policy community. Aware that they could no longer claim that their organization had a purely technical function, they acknowledged that it was becoming politicized, and urged other members of the policy community to blame the government for such policies as those contained in Training for Jobs.19 Yet neither of the departments of state nor the Cabinet can have expected the bipartisan campaign against this proposal. It took months of conflict generated by the Conservative-dominated Association of County Councils (ACC) in collaboration with the Labour-controlled Association of Municipal Authorities (AMA) to resist the proposal. The government offered concessions, particularly after the appointment of Sir Bryan Nicholson as the new MSC chairman. The particular proposal was withdrawn, but on condition that the LEAs and the MSC produced, in partnership, local plans for the FE sector to be described as work-related further education (WRFE). Local authorities retained their money for 1985–6, and the MSC was prevented from purchasing individual courses. Training policy, corporatism and the state Both the political and industrial wings of the labour movement offered only mild criticisms of the changes in MSC management and policy from 1982 to 1987. The main ideological critics of the MSC were on the left, and they made a series of accusations which included a condemnation of the MSC’s

58

The politics of the training market

authoritarianism and bureaucratization, as well as of its more ‘ulterior’ purpose of massaging unemployment figures, cutting wages, undermining unions and restructuring the labour-market on dogmatic grounds. Clare Short is correct to comment that the Labour Party did not endorse these criticisms because the leadership ‘felt responsible for the early development of special measures and was unable to turn round and attack its own creation’, and because the ‘TUC helped to run the MSC and therefore defended MSC programmes. Labour’s front-bench spokespeople were briefed by the TUC’.20 Where Short’s memory is more doubtful, however, is in failing to recognize that the idea of the MSC was reasonable for a trade union movement to promote, as the case of its Swedish counterpart (the AMS) demonstrates, and that the 1970s Labour government also had little choice but to introduce crisis measures to deal with unemployment and skills shortages. Before Norman Tebbitt’s appointment in 1981 (which was itself symptomatic of a wider political change), the MSC, the Commission and the chairman had enjoyed greater practical autonomy, albeit as a privilege rather than as a ‘right’. The analysis in Chapter 1 demonstrated that the MSC’s autonomy was always theoretically ambiguous. However, O’Brien’s continuing adherence after 1981 to a bifurcated view of his role, first as the MSC’s executive manager, but second as a semi-independent expert offering advice on labour-market policy, was increasingly at odds with the new position. O’Brien overtly supported the TUC’s resistance to some of Tebbitt’s specific proposals on YTS, embarrassed the government by publishing figures which projected continuing rises in unemployment and openly disagreed with Tebbitt’s conference statement that employers were ready to assume the full costs of training.21 Such irritations apart, the Secretary of State had no sympathy with O’Brien’s conception of his role as an impartial chairman, neutral between government, industry and trade unions. Tebbitt wrote that ‘despite his [O’Brien’s] willingness to serve another year as chairperson of the MSC his services were not required’.22 O’Brien made the error of attempting political independence, and of seeking to be an expert on the labour-market, in the same way as his German counterpart. Germany operates a federal structure, however, which allows for greater criticism of the elected government by those charged with carrying out labour-market policy. Previously Tebbitt had rejected the names of possible successors as chairperson which his Civil Servants had proposed. Nor did he consult the CBI, the TUC or the Commission before appointing David Young, who was then special adviser to the Industry Secretary, Patrick Jenkin, to the post. Yet O’Brien’s own appointment had been proposed by the CBI and accepted by the Commission as a political balance to Jim Mortimer, a trade union official, who had been appointed to the chair of the Advisory, Conciliation and Arbitration Service (ACAS). It was assumed that the same consensual pattern

The MSC in its glory

59

would continue, and that since Pat Lowry, British Leyland’s personnel director, had inherited ACAS in 1980, he would be balanced by somebody with a trade union background at the MSC. Labour governments may have scrupulously preserved a political balance, but that such a consensual approach was incompatible with the ‘conviction politics’ of the Thatcher years was clear from Young’s statement on his appointment, in which he opposed throwing money at problems.23 One commentator inferred that under Young’s chairmanship the MSC would degenerate into a unit working with such special groups as the disabled, and that the private job agencies would assume the rest of the MSC’s work.24 This was a misperception, however, which failed to grasp the government’s need to use the MSC to reshape the labour process, change attitudes to training and manage the long-term and youth unemployment crises. Yet while David Young’s appointment represented something of a seachange in the MSC’s procedures, it merely emphasized the more permanent reality – that the three main partners in the so-called ‘corporate state’, or more plausibly the limited tripartite system, are never equal. As Mason and Russell argue with reference to the MSC, while the trade unions were never able to initiate very much, the employers always had the power to refuse to initiate and implement policy, and the state determined the forms and structures within which both sides of industry operated.25 This state sovereignty is supported by the suggestion that Tebbitt was willing to abolish the MSC, and to run the services directly from the DE if the unions were to become too critical of the new circumstances and policies.26 The issue of the Commission’s influence after 1981 has been variously interpreted, but while it enjoyed a less powerful role than in the years immediately before, it had never enjoyed sufficient status to justify the erroneous claims of the corporatist theoreticians of British politics. It is clear that the entire MSC was ultimately an arm of state policy. Whatever its precise influence, however, a striking characteristic of the Commission’s deliberations – and this applies equally to the procedures of the 104 tripartite area manpower boards (AMBs) which were set up in 1979 – was that their proceedings were so harmonious that it was rare for votes to be taken. Schnack’s research into the role of employer representatives reveals that they generally failed to attend the AMB meetings, were never formally accountable to regional CBI members, and generally felt an esprit de corps with union board members.27 There are also strong signs that board members did not regard officialdom highly. All in all, the evidence of the MSC does not support the corporatist theoreticians, since it appears rather to have been a case of limited tripartism for a specific purpose. The CBI members were never fully accountable representatives, and, while the TUC members of the Commission did satisfy representative requirements in their annual reports to congress, they were

60

The politics of the training market

never able fully to commit all the trade unions to a given policy. More important was the MSC’s accountability to the Secretary of State, and his accountability in turn to parliament. The fragility of the tripartism is clear from the ministerial readiness to dispense with it if it failed to deliver what the central policy-makers required, as with the controversy over ET in 1988. While it would be possible to locate the Commission’s activities in the debate about the development of British corporatism, it is not proposed to do so, as the conclusions would be largely negative. Critics of the MSC’s power in the early and mid-1980s were, wittingly or otherwise, actually condemning government policy, for which the MSC was a largely uninfluential ‘smokescreen’. As Kay Stratton argues, the last remnants of MSC independence were removed with the abolition of the Commission in 1988. Before that, the loss of employment responsibilities, which the Commission regretted, revealed the government’s desire to ‘clip the wings’ of the MSC, but from 1987 to 1988 a form of tripartism continued. It was the removal of that tripartite element, with the transformation of the Training Commission (TC) into a mere Training Agency in September 1988, which eradicated the remaining barrier between training policy-making and direct government control. Yet it was at this stage that the government itself also began to shift its focus from measures to tackle unemployment to initiatives devoted to making good Britain’s growing training deficiencies, which had deepened during the 1980s. This deterioration was the result of the 1979–82 recession, which damaged manufacturing industry, and led many firms to cease apprenticeship schemes entirely. TECHNICAL AND VOCATIONAL EDUCATION INITIATIVE (TVEI) Before the YTS scheme was introduced, the MSC began to widen its concern with the training of young people, and even to focus on the educational process in schools. In November 1982 the Prime Minister invited the MSC to launch the TVEI, and fourteen projects commenced in September 1983, forty-eight more started in 1984 and a further dozen in Autumn 1985. Margaret Thatcher announced that the initiative was required in response to growing concern about the technical and vocational education of young people. It is significant that there had been no consultation with interested parties. The idea emerged from discussions between the troika of David Young, Sir Keith Joseph and Norman Tebbitt. The projects were managed by LEAs under criteria established by the Commission. The area of the transition from school to work was a natural extension of the concern which James Callaghan had expressed in his famous Ruskin College speech in

The MSC in its glory

61

1976, which opened up the ‘great debate on education’. One of Callaghan’s main concerns had been the dissatisfaction which many employers felt with the products of the schools.28 The DES was simultaneously promoting its own initiative, the Certificate in Vocational Preparation and Education (CVPE) to offer practical skills to early school leavers and to ensure some continuity of provision between the schools and the colleges of further education (CFEs). The TVEI was, unlike YOPS and YTS, a pure training initiative rather than a panic response to labour-market conditions, and it had a positive aim. Robert Taylor has attributed the credit to Lord (then Sir David) Young. Although a committed free-marketeer and critical of state intervention, Taylor argued that under Young the MSC ‘has become far more of a training agency and much less of an ambulance wagon to cope with a social crisis’.29 Young’s main motive in promoting TVEI was to respond to the education system’s failure to provide qualifications for over half of the school leavers. He was correct to identify a problem which The Economist was still describing seven years later as Britain’s worst educational problem.30 This involvement in youth training, together with the YTS, gave the MSC a centrality in the new ‘educational settlement’.31 The settlement was concerned both with the curriculum for those who were about to leave school early and the training experiences of recent school leavers. The aim was to gear the period of transition to the needs of industry, and to merge education and training together. As the 1982 MSC Youth Task Group Report expressed it, the aim for the new generation of workers was ‘to develop and maintain a more versatile, readily adaptable, highly motivated and productive workforce which will assist Britain to compete successfully in the 1980s and beyond’.32 TVEI commenced as a pilot scheme for fourteen LEAs covering 14,000 students in 200 schools and colleges, and its goal was to disseminate as much technically and vocationally orientated education as possible.33 A number of LEAs refused to bid for TVEI money because they perceived it to be a threat to their power and autonomy. It is patently the case that the MSC’s youth policies produced boundary problems between education and training, with the DES responsible for CPVE and non-advanced further education (NAFE) and the MSC running YTS and TVEI. A chairman of the education committee from the Kirklees LEA asserted, for example, that ‘Kirklees education is not for sale’.34 The majority of councils were perfectly content, however, to undertake the initiative, as it provided an alternative source of income to the inadequate rate support grant. Participating Labour LEAs justified their decision to participate, on the other hand, by the casuistic argument that schools and teachers would be able ‘to take the money and run’ in order to undertake more experimental, varied and interesting forms of learning than those implied by a strict observance of MSC guidelines.35

62

The politics of the training market

Clare Short, MP, when she was a radical Labour front-bench spokesperson on training, conceded that many TVEI schemes had proved to be progressive in practice, as teachers had seized the opportunity to move the curriculum forward and to introduce active learning. Yet she argued that such advances were the product of subversion. The scheme was ultimately flawed, Short maintained, because its focus on work-experience was excessive, when what was required was later entry of young people into the labour-market, and far greater post-school training.36 It is worthy of note, however, that HMI Brown considered that the TVEI’s influence contributed to an improvement in the content of the National Curriculum.37 The TVEI was reviewed by the MSC in 1986, and a report noted that the scheme was attracting students of both sexes across the ability range. While one of its concerns was to provide work-orientated education for under achievers in the 14–18 age range, it was also intended to provide a practical emphasis in schools so as to imbue the entire curriculum, and the entire age group, with an appreciation of the world of work. This was compatible with the goal of improving the efficiency of labour markets.38 Clearly, the TVEI was appropriate given the MSC’s training objective of enabling all young people to enter the labour market with a qualification. In that regard, TVEI should be interpreted together with YTS as a response to the British situation within which the majority of 16-year-olds attempt prematurely to enter the labour market. That much remained to be achieved here was demonstrated by the MSC’s own Labour Market Quarterly for September 1987 which concluded that people: with higher qualifications below degree level are just as likely to be in work as those with no degrees. The lower education bands reveal that people with no qualifications are better off in terms of being in work than people with qualifications to CSE level.39 The TVEI was administered by the TA until the new division within the DE took it over, but responsibility has ultimately passed to the training and enterprise councils (TECs). The TVEI still plays a central part in the schools’ curriculum, yet the impact of the 1988 Education Reform Act ensured that it is most actively associated with the non-academic streams. The opportunities for subversion have now diminished, and the scheme has lost much of its sense of innovative excitement. It covers nearly 6,000 schools, however, and affects in some measure all 14–18-year-olds in full-time education. It is likely to continue, since, as the National Foundation for Education Research’s report on TVEI in 1989 showed, most employers remarked favourably on the motivation, punctuality, communication skills and team- work capacities of their recent recruits. Employers also considered that TVEI recruits were better

The MSC in its glory

63

prepared for work than their non-TVEI peers, the majority felt that TVEI products had a long-term future with their firm, and work experience was regarded as valuable. Clearly, the DE still strongly supports the initiative, and points out that ‘TVEI can provide TECs with one of the key ways in which they can work with the education system to develop the foundations for the workforce of the future’.40 It is interesting that TVEI remained under DE control for a period after the TECs were established, however, whether to ensure that the bridge between school and work was built, or because TVEI was considered too important to be transferred. Either way its mediumterm future seems guaranteed. Finally, some comment should be made about the TVEI from the perspective of the professional educators who were directly affected by its implementation. A full account has been written by Roger Dale, who argues that they key themes running through TVEI are process, experience and management. So TVEI had an avowedly practical bias, although Dale points out that while emphasizing educational ‘processes’ and ‘experiences’, it was also directed towards such instrumental ends as the ‘national need’.41 The post-war political consensus, of which one symptom was the cosy ‘educational sub-government embracing teachers, LEAs and the DES’, insulated teachers from demands from central government for economic relevance. The TVEI required substantial changes in this respect, however, with, for example, the establishment of records of achievement and profiling for all pupils. Initially the TVEI was introduced for a pilot stage only and it encountered a good deal of opposition from educators, but Dale argues that by the end of this phase the scepticism seems to have declined. This was partly because of ‘a committed legion of educationalists for whom TVEI had become their bread and butter and for whom the retention and expansion of the scheme had become vital to their career interests’.42 Dale also confirms that many schools found it easy to introduce TVEI funding to promote developments which had otherwise been precluded owing to a lack of funding. Yet he also suggests that it was exactly those schools which had largely disregarded MSC guidelines for all but administrative purposes which were laying the foundations of a more effective generalization of the programme when the opportunity arose. This was because those schools had generalized and extended the initiative from the outset. There was a deterioration in the TVEI after 1985, since at that date the MSC re-assumed the ‘ownership’ of the scheme. In short, the scheme had become so consolidated in many LEAs that it was increasingly difficult to distinguish it from everyday business. Yet this is a sign that the important work of TVEI has already been achieved. Practices which would have been totally alien to most teachers earlier in the decade, such as bidding against other

64

The politics of the training market

schools for money or being required to teach and encourage children to make profits, are now commonplace and widely accepted. The success of TVEI probably helped to embolden the government to embark upon the major reform of education in 1988. THE YOUTH TRAINING SCHEME (YTS) Critics and supporters alike described the YTS as ‘the jewel in the crown’ of the government’s training programmes during the mid-1980s.43 The view is supported by senior MSC officials who asserted that the MSC was able to avert major Treasury raids upon its budgets by threatening to cut the YTS, a scheme which the government so favoured that it sometimes responded by withdrawing proposals to cut MSC funds generally.44 The special status enjoyed by YTS was partly a legacy of the important role which YOPS had played since the late 1970s, but the YTS also served a propaganda purpose for the government, which, unable to solve the youth unemployment crisis, required a public-relations initiative to demonstrate its concern and activity. But the YTS was also specially favoured because it served a number of other compatible policy goals. Policy always emerges most rapidly when there is a confluence of events and influences. The YTS also offered a timely response to the urban riots of 1981, and served to undermine the traditional character of apprenticeships, as well as the power which the monopoly control of the system had given the entrenched trade union interests. The origins of YTS The YTS was first conceived in the autumn of 1981, after the urban riots, and it was instrumental in deciding government to retain the MSC despite earlier hostility towards it and quangos. The first schemes under the aegis of YTS were launched in 1983, and they were one-year programmes consisting both of work-experience and a period of off-the-job training. There were two main modes. Mode A was oientated towards training and work-experience in the private sector, while Mode B was focused on the public sector and voluntary organizations, and often involved little training. The government and MSC both launched publicity campaigns on behalf of YTS, selling its merits as a training scheme preparing young people for the employment opportunities which would emerge with economic recovery, by securing them personal transferable skills. The more strident critics of YTS described it as a cheap labour scheme, which endangered the safety of youths through accident, and which was concerned to instil work discipline in the young people for whom the

The MSC in its glory

65

economy had no role, but who were becoming an electoral embarrassment. Both interpretations distorted reality. The YTS was a variable scheme and it included experiences ranging from the excellent to the execrable. Yet even the MSC acknowledged in 1985 that the YTS could be improved, and it proposed a new two-year scheme related mainly to the private sector. The YTS as it developed in the rest of the decade was posited upon this strategy.45 It is apparent, despite the impact of both YOPS and Phase 1 of YTS, that British youth training was inadequate. The joint MSC and National Economic Development Office (NEDO) report, Competence and Competition, pointed out that vocational education and training (VET) throughout Europe was normal until the age of eighteen. The report also argued that in North America and the Far East fewer young people entered the labour market without training.46 Yet the critics of YTS must accept that to have returned to the status quo ante bellum would have involved a diminution of youth training. Certainly, Labour Party criticisms of the MSC declined in the party’s post-policy-review era, and, while recognizing the patchy nature of provision, came to perceive the need to widen the range of opportunities offered by MSC and to build upon effective schemes rather than to sweep them away. There was much more to YTS, therefore, than mere ‘crisis management’ or the manipulation of youth wages in the interests of employers; it was also a ‘technocratic’ response to objective labour-market requirements. The technocratic aspect in the conception of YTS led the MSC to adopt an almost ‘manpower planning’ approach to youth training which was quite alien to New Right free-market economics. The Commission was still reminiscent of the ‘unreconstructed’ planning approach with its trade union membership, but Lord Young (who was the MSC’s chairman from 1982 to 1984 before becoming Secretary of State for Employment) sometimes shared this perspective. The MSC’s 1985 report expressed the aim of attracting two-thirds of the age group on to the YTS. Lord Young went further in his long-term projections and proposed that 15 per cent of the cohort would go into higher education, 35 per cent would go through the Technical and Vocational Education Initiative (TVEI) directly into employment, and about half into YTS. Yet such assertions reveal that even the Thatcher government was prepared to plan when national economic needs so dictated. They also lend support to the views of radical critics such as Dan Finn and Denis Gleeson that YTS was an exercise in manipulative social control.47 Yet the MSC’s left-wing critics cannot both accuse the government of ideological dogmatism in favour of the market and also complain that it plans second-rate training for second-rate citizens. Nor were the critics assuaged by the support which the Commission offered

66

The politics of the training market

to YTS, since many left-wing critics deplored the manner in which they considered that trade unions supported the MSC’s errors. The Commission was, however, an important influence in encouraging ambitious aspirations for YTS, and its role helps explain the intellectual confusion between free market, manpower planning and social manipulation which constituted the MSC’s programmes in the 1980s. The role of individual policy-makers is also of the utmost importance. David Walker argues that Geoffrey Holland, a senior Civil Servant in the MSC until he became Permanent Secretary at the DE in 1987, was largely the author of both YOPS and YTS, and that he proselytized vigorously for both to ensure their successful implementation. Holland modestly denies his centrality, and stresses that he was one of many policy innovators in the area who were responding to national need and to the demands of a Commission on which trade union members were influential. His style of policy-making, however, is also a factor in explaining the location of YTS between the old and the new politics.48 Despite his associations with an earlier Labour government, Holland’s ability and experience presumably made him invaluable to the Thatcher government. Walker argues that in 1981, for example, ministers who were divided on other policy issues pursued similar policies on youth training because of Holland’s influence.49 Yet while Holland’s contribution helps explain some elements of the YTS, individuals can only exert influence when circumstances are propitious. Alice Brown and John Fairley point to eight other reasons for the creation of YTS. First, the rise of unemployment from 2.1 per cent in 1973 to 12.3 per cent in 1981, with a disproportionate growth among male youths, led to the recognition that YOPS could not be discontinued, but that a more permanent training scheme was necessary. Second, there was a sharp decline in youth employment prospects because computerization removed routine jobs and economic recession destroyed apprenticeship prospects. Third, the number of young people seeking work increased substantially as the 1960s baby boom altered demographic patterns. Fourth, the Conservative government adopted a new labour-market policy which focused particularly upon supply-side factors. This involved the removal of rigidities: for example, by putting downward pressure on youth wages relative to adults. Fifth, the industrial training boards (ITBs) were widely considered to have no relevance to the needs of the unemployed, and some radicals were critical of their tendency to exclude girls and ethnic minorities. Sixth, as schools came under increasing criticism for failing to provide industrially relevant education, YTS with its focus upon work-experience on employers’ premises seemed appropriate. Seventh, YTS was a quick and convenient way for government to respond to the crisis of urban unrest in the aftermath

The MSC in its glory

67

of the events of summer 1981. Finally, there was an elite consensus that youth training had fallen behind that in other European countries, and Holland’s proposals were satisfactory both to trade unionists and industrialists. In short, Holland was a very creative Civil Servant but circumstances sustained his ideas.50 As has already been pointed out, YTS served many purposes. While coinciding with the government’s supplyside and labour-market strategy, Conservatives appreciated that an improved youth training programme could help meet popular concern about youth unemployment. It is evident that political concern with unemployment grew in 1981, especially after the Chancellor of the Exchequer Geoffrey Howe’s deflationary budget in the spring enabled the government’s opponents to argue that his policies had induced the problem. And even government ministers registered their alarm when the Central Policy Review Staff (CPRS) predicted that unemployment would reach three million with particularly bleak prospects for school leavers. Howe proposed a strategy to widen the differential between trainees and young workers, and John Hoskyns of the Downing Street Policy Unit called for a politically imaginative step to tackle the crisis.51 These were the political imperatives which led to the adoption of YTS, which, Riddell argues, together with the Community Programme, ‘marked almost a new beginning for the Thatcher Administration’.52 Holland was a major contributor to a series of papers promoting a new training scheme for youth, and which ministers John Nott and James Prior supported in Cabinet.53 So YTS was set up, but it was not the only possible response to the problem. ‘Wet’ Conservatives and the TUC, for example, pressed for economic reflation so as to create jobs in manufacturing industry. Norman Tebbitt was the Secretary of State for Employment charged with steering YTS through parliament. He asserts that YTS was a considerable achievement as it was necessary to secure vast numbers of placements, together with the co-operation of a number of educational institutions, by September 1983. He also confesses that he sought to make YTS compulsory by stopping the benefits of young people who refused to enter YTS schemes, and while acknowledging his defeat at the time he points out that Norman Fowler achieved the same outcome in 1987. These comments are interesting given later government denials that it had ever made YTS compulsory. Yet Paul Lewis is correct to point out that removing the income of those who do not join is tantamount to compulsion since it constituted a fine of £2,000. Further, private employers could continue to select their trainees, thus leaving Mode B to receive the unwilling conscripts.54 It is also likely that Tebbitt never expected to achieve a compulsory YTS at that juncture but by threatening it he managed to secure trade union concessions on the principles

68

The politics of the training market

of a voluntary scheme, and an allowance of £25 a week which was below trade union demands.55 That Tebbitt had radical intentions towards training policy and towards the role of the MSC is clear from his comment that Sir Richard O’Brien was too consensually minded and corporatist to continue as chairman, and that the names submitted to him by both the TUC and the CBI were in similar mould. Although even the Conservative newspaper The Times called upon Tebbitt to maintain a consensual approach towards training policy, Tebbitt decided to appoint David Young, who was certainly ‘one of us’ and who had previously been an adviser at the Department of Trade and Industry. Tebbitt naturally denies Young’s partisanship and describes him as a ‘non-political’ figure.56 The case for YTS was clear and the deficiencies of the education system were apparent, therefore, given the reality that over four in ten of young people either entered the labour-market without qualifications or possessed merely low grade CSEs.57 The review and extension of the YTS The aims of YTS, when it was first implemented in April 1983, were laudable. They were to give young people skills in an employer-based environment, to prepare them for adult life and to provide a bridge between school and work to improve skills in preparation for entry into the labour-market.58 In the medium term the YTS also aimed to provide a high quality programme of foundation skills-training for 16- and 17year-olds, and to meet the government guarantee that a suitable place on YTS would be offered to all unemployed school leavers by the Christmas after which they left school. The long-term objectives were the most ambitious. They were to give young people qualifications or credits towards them, to improve youth job prospects, to provide employers with the skills that they require and to encourage employers to assume a bigger share of the cost burdens. These objectives were capable of evaluation, and the Commission, the DE and ultimately the Treasury duly evaluated their degree of fulfilment. There is also evidence, however, that such a ‘rational’ approach to policymaking was not observed. While the Commission was asked to examine the scheme in April 1985 it was rather in the spirit of advising how the scheme might effectively be extended to two years. The government had effectively decided on the grounds of intuition, political gain and response to MSC propaganda that it desired the scheme’s expansion. Despite the MSC’s rapid growth, therefore, the extension from a one- to a two-year YTS fits better the ‘incrementalist’ model. In April 1985 the government announced in its White Paper, Education and Training for Young People (Cmnd. 9482, paras 31 and 24), that it wished to establish a two-year scheme

The MSC in its glory

69

for all 17-year-olds. The Commission welcomed the idea of a two-year scheme, as well as the government’s intention of making the YTS a permanent feature of vocational education and training provision, and its target that all young people should enter the labour-market with qualifications related to employment. The Commission was particularly pleased that such a policy development brought close to fruition the second objective of the NTI of 1981, to give all under-18s the opportunity to continue in full-time education, or to enter a period of planned workexperience combined with training. An aspect of the Commission’s decision-making process which is compatible with a rational approach to the business of policy-making was its readiness to learn from the youth training policies of other countries. There has long been a recognition in Britain that its training policies were less advanced than those of major economic rivals. The effort which the Commission made to examine the youth training policies of France, Germany and Sweden was a commendable attempt to inject an informed basis for policy-formulation in Britain. One of the characteristics of rational policy-making is to maximize the amount of information upon which decisions are based. This is not to argue that there is merit in Britain slavishly emulating the training practices of other countries, owing to the substantial differences in culture and institutions which renders simple policy transfer inappropriate. There is also a real danger of selective perception, where observers are highly selective in what they are prepared to imitate, and thus utilize a ‘foreign model’ in a disingenuous attempt to legitimize pre-conceived policies. It is also the case that to implement the same policies in Britain, without investing equivalent resources, is not rational. Sweden, France and Germany were, in any event, three countries which the consensually orientated Commission was likely to consider sympathetically. A working group was dispatched to the three countries, and it took the opportunity to investigate their entire VET arrangements.59 The Commission’s attitude towards YTS by 1985 was that, while it required refinement, it was a good scheme which should be built upon. It stressed the evidence of success. By 1985 YTS attracted 60 per cent of the young unemployed age group, and its methods of work-based training were innovative. YTS was to be commended for including ‘a structured workbased training programme incorporating a minimum of thirteen weeks offthe-job training, as part of a programme for sectors of employment where such opportunities had not existed previously such as Information Technology’.60 It also developed youth training to standards of competence rather than to the old time-based training characteristic of apprenticeships, and 40 per cent of the trainees were acquiring qualifications.61 This

70

The politics of the training market

Panglossian view reveals the degree to which even the trade unionists on the Commission had become socialized by the MSC’s ethos, since, to criticize apprenticeships (which the unions had played such a large part in shaping), was to acquiesce in the government’s view. It is true, however, that apprenticeships were frequently overlong, narrowly based and overpaid. At the same time, the Commissioners were presenting as partial a picture of YTS as were its critics. Yet one of the MSC’s advantages was the relative speed with which it could introduce initiatives, and its lack of normal Civil Service caution. Its chief benefit to the government was its capacity to deliver major policy initiatives with greater urgency than the DES, which was still dependent upon the LEAs for the implementation of policy. Yet the YTS was largescale, rapidly implemented, a mere eighteen months from conception to launch and required the co-operation of many agencies and thousands of employers. It was inevitable, therefore, that it would contain many imperfections. An MSC review of YTS in 1984 accepted that too much had been expected too rapidly, and that it displayed uneven standards of training.62 MSC officials often commented at this stage that while the YTS was ‘a good thing’, it was undermined by widespread misperceptions on the part of young people, trade unionists and parents. While it led to good training and qualifications in practice, it was perceived as an emergency measure responding to high unemployment. MSC officials stressed that the best-known Mode B places were unrepresentative of what was happening in Mode A with private sector employers.63 Mode B places were far more numerous, however, because insufficient private employers were co-operating. The Commission did not perceive itself as engaged merely in a remedial exercise to cure the imperfections in YTS. It was influenced by the publication in May 1985, during the course of its own deliberations, of the MSC’s own Labour Market Quarterly. This report noted that the number of births reported in Britain had peaked at just under a million in 1964, and that numbers were continuing to fall. It inferred that in future the economy would have to ‘support growing proportions of older people’ meaning that more ‘will depend on the efforts of a smaller population of working age’ which in turn meant that ‘their competences will become even more vital’.64 Noting that the target group of YTS was the two-thirds of the population which did not continue in full-time education, the Commission concluded that the labour-market of the future would require far greater competences in the adult population. This was a clear reason for the Commission to support the government’s proposal for a two-year scheme. Yet even had the Commission opposed the idea of a two-year scheme, the government’s commitment to the idea was unambiguously signalled when the Chancellor

The MSC in its glory

71

announced in March, before both the White Paper and the Commission’s review, that he was to add £125m. for 1986–7 and £300m. for 1987–8, specifically for the development of the YTS. The relative importance of YTS within the MSC’s budget was revealed in the MSC’s corporate plan for the period 1984 to 1988. While YTS was planned to account for £1,136m. for 1986–7, TOPS was to cost £247m., Community Industry £28.1m., Open Tech £12.7m., and all other MSC-funded training £50.6m. As late as the mid-1980s, therefore, the YTS still accounted for the lion’s share of the training budget.65 The setting up of the two-year YTS provides an important illustration of the reality of the power relationships between the Treasury, the DE and the Commission. It was evident that the two-year YTS had the blessing of the Prime Minister, that the Treasury was willing to make the resources available and that it was the Commission which was charged with the task of determining how it was to be implemented. If the MSC, and the Commission’s role within it, were still protected at this juncture, it was because the government considered them to be useful instruments for implementation and legitimation. Yet while the Commission’s utility from the government’s standpoint was to legitimize, by ensuring trade union cooperation with national training policy, it also exploited this usefulness by affecting policy at the margins, since it represented a number of key interests. The Commission was still able to insist at this point that the YTS remain voluntary, with no coercion on employers to provide training places, or on young people to take part in the scheme. The government hankered after compulsion, however, and eventually came close with the 1987 Social Security Bill. The compulsion issue apart, however, there was clearly a strong consensus behind the achievement of such outcomes as providing young people with a range of occupational skills, of a transferable variety, to enhance personal effectiveness. The new two-year YTS began in April 1986 and offered two-year training for 16-year-old school leavers (with twenty weeks off-the-job training) and one year for 17-year-olds (with a minimum seven weeks off-the-job training). Both sets of trainees were to be offered the chance to secure nationally recognized qualifications, together with training agreements to spell out training rights and responsibilities. Allowances and travelling expenses were to be increased, and premium grants and places offered to trainees up to the age of 21 in inner-city areas and to the disadvantaged. The MSC now also began to encourage employers to transfer their young employees on to YTS. This was both to overcome the YTS ‘image’ problem as a mere antiunemployment palliative, and to ensure the survival of YTS which now had to compete with employers because of the recovery of the economy and the tightening of the labour-market, as well as with an expanding higher education

72

The politics of the training market

sector. These challenges also coincided with an absolute decline in the number of young people.66 Quality assurance and control The most interesting innovations associated with the two-year scheme were linked to the issue of quality assurance and control. Concerned both to counter the negative propaganda that the scheme was merely an antiunemployment palliative, and to rid the YTS of those schemes which were inadequate or unsafe, the MSC set up approved training organizations (ATOs) and the Training Standards Advisory Service (TSAS). These changes were not mere public-relations tokenism. Employers wishing to participate in the YTS had now to secure ATO status by convincing MSC area boards, which had the same representative character as the national Commission, that they possessed the staff, resources, premises, equipment and commitment to training to enable them to be YTS training organizations. The work of the ATOs was to be further monitored by the TSAS, which, modelled on Her Majesty’s Inspectors (HMIs), was entirely independent in character. Clearly, YTS was coming of age, and all involved were anxious to rebut the scheme’s many critics. If the MSC was slightly pretentious in discussing its mechanisms for ‘quality assurance and control’, which was a procedure which originated in engineering and requires extremely precise measurement, it provided itself with a validation role which had been rather haphazard previously. The training officer of the TUC, Alan Rogers, claims that it was TUC influence through its commissioners which secured the ATO strategy, and given his considerable sympathy for the MSC it seems likely that his claim is warranted.67 It is certainly the case, in the aftermath of the 1984 TUC Congress, that TUC members of the Youth Training Board (YTB) which the Commission set up to oversee national developments on YTS, emphasized a series of issues concerned with the level of allowances, the quality of training and the use of private training organizations. 68 It was TUC pressure particularly which enabled the Commission to resist the removal of supplementary benefit from young people who refused to participate in the scheme. It is also clear that in 1985 the Education and Employment Policy Committee urged TUC representatives on area boards to stress the need for proper qualifications to be offered to trainees, and ‘to regulate training provision by laying down criteria which must be met to become an Approved Training Organisation and to run YTS schemes’, and that the criteria should include the employment of professional staff, the training and briefing of supervisory and supporting staff and the setting up of programme review

The MSC in its glory

73

teams representing management, unions and trainees.69 The TUC claims credit for the outcome of the Commission’s meeting in June 1985, which demanded: Approved Training Organisations may only take part once they have satisfied criteria drawn up by the Commission, including the resources of the organisation, the competence of its staff, the suitability of its premises and equipment, its previous record in training and its financial stability, with a new Training Scheme Advisory Service to maintain the quality of the training provided, coupled with a new status for all young trainees based on a training agreement between the trainee and the ATO.70 In any event, the MSC soon became proud of its arrangements, and contrasted them with the minimum scrutiny which had taken place over YOPS and YTS Stage 1. In the first year there were 3,300 applications for ATO status – encompassing 5,000 different overall schemes, which contained 11,000 different individual programmes delivered through 100,000 work-experience providers. Some of the applications were withdrawn during the period of scrutiny. Of those which were examined, 2,084 were granted full ATO status, 1,085 provisional status and only eight were rejected. There were 2,019 ATOs in the private sector, 751 in the public sector, 136 in information technology centres run by the MSC and the LEAs, and 271 in the voluntary sector.71 The low number of rejections for ATO status is striking, and while it may suggest that standards were none too onerous, Alan Rogers of the TUC claimed that this reflected the fact that the requirement for employers to apply for ATO status discouraged the unreliable employers even from seeking approval. MSC officials stressed that the high number of provisional approvals were dependent upon the applicants making improvements before ATO status could be granted. It was probably the marked shift towards the active involvement of private employers which most gratified MSC and DE officials, however, although it was also recognized that many employers still failed to see why they should participate. For example, Sony saw little benefit in taking on YTS trainees when it could employ young girls to do basic tasks on low wages; and it was not easy to persuade firms that they had a duty to help nurture transferable skills or information technology (IT) in their young employees, despite the fact that such qualities would be essential in the future for the national economy. It was also apparent that some national YTS officials feared for the future of YTS because of increasing resistance from young people themselves. While, for example, in 1988 11 per cent of young people of the appropriate

74

The politics of the training market

age entered YTS there were great regional variations, and it was apparent that YTS would increasingly have to compete with employers and further education and to work in conjunction with the Careers Service. Some officials regarded the salvation of YTS as lying with the growth of trainee employee status. If employers and young workers alike could merely transfer to YTS status while in employment, then the future of YTS and the development of the flexible personal skills required by the economy could both be secured. The logic in the idea of persuading more employers to allow their workers to take YTS training lay in the combination of the declining number of 16year-olds, with the inadequate training currently provided for younger workers actually in employment.72 The same officials stressed, however, that concessions would have to be made to employers in order to win their full approval for employed trainee status, particularly with reference to the amount of off-the-job training. Yet this concern about the future of YTS was mitigated by confidence that government would still prefer the MSC to the DES and the education service in the delivery of training provision, because of the MSC’s superior management ethos. The MSC’s practice was that each official reported to an appropriate line-manager, each office was measured for its success in achieving its goals, and so the ‘results ethos’ of the MSC made it a more reliable instrument to implement government policies than the DES and the LEAs. While the confidence in the government’s commitment to the MSC proved to be unjustified, it is a valid judgement about the government’s lack of faith in the education service – as the establishment of private-sector led training and enterprise councils (TECs) demonstrated. While the ATOs and the TSAS undoubtedly improved the quality of many YTS schemes, some aspects of the schemes continued to give concern. From the standpoint of health and safety, for example, there was little point in ATO and TSAS activity if overall government policy was moving inexorably in the direction of deregulation and the reduction in the number of factory inspectors. Despite the single market and 1992, Britain’s deregulation policies were increasingly contrary to those of her European partners. The process of responding to applications from ATOs was open and thorough, and involved the AMBs and its various constituent interests. Yet even MSC officials admitted that the quantity of work was such, particularly during the ‘bulge’ period from March to May 1987, that the process was imperfect. MSC officials countered criticisms from YouthAid and others that the process of ATO approval excluded the opinions of trainees, by pointing to surveys which elicited the subjective responses of trainees. There was a longitudinal study monitoring young people’s decisions and behaviour over a three-year-period – ‘the Cohort Study’ – undertaken by Social and Community Planning Research and the University of Sheffield. It indicated that those who left school to go directly into employment only received

The MSC in its glory

75

training in 40 per cent of cases.73 This was possibly understood by young people, 40 per cent of whom gave the desire to be trained as the reason for joining YTS, and graduates from the scheme considered that they had received more training than did their counterparts who went straight into work.74 The Cohort Study further revealed that around 57 per cent of 1985–6 school leavers were in jobs three months after leaving, and a ‘comparison of the occupational area of training with the occupations where trainees get jobs indicates a broad match between YTS and the labour-market’.75 The MSC did not rely upon external sources of information, however, since its own research department undertook regular surveys of providers, examined the wider labour-market effects of YTS, as well as the implications of different labour-market conditions upon YTS recruitment. Its concern with YTS was, therefore, long-term and concerned with overall quality rather than day-today monitoring. The MSC also questioned employers about their reasons for participating in YTS, and must have found the responses to be reassuring. Most firms advanced ‘business’ reasons, but the most common cause was the opportunity which it gave to screen potential employees, since YTS was considered a good source of recruitment. Equally satisfying was the evidence that employers were increasingly bringing jobs within YTS. 76 The MSC considered that its goal of providing YTS teams merely to act as partners, consultants, catalysts and ambassadors was being fulfilled. By 1987 the MSC asserted that: YTS marks a major change in the way in which we prepare our young people for working life. The government has made a public commitment to establishing YTS as a major part of the nation’s vocational education and training provision. The scheme’s aims and objectives are ambitious and the evaluation of these aims will be a long-term continuing process.77 The MSC also took the view that employers would come to play a larger part, and their own role would be correspondingly reduced, in the steerage of the scheme. This came to pass more spectacularly than was predicted, however, with the transfer of YTS to the TECs. By 1988 MSC officials hoped that employers would run and manage YTS, with the MSC confining itself to hands-off monitoring, which would also lead to a fall in MSC subsidies and a rise in employer contributions (including the voluntary topping-up of trainee allowances). This was less drastic, however, than the direct control which employers were to assume under the aegis of the TECs. While MSC officials can be forgiven for not predicting the MSC’s demise, they did foresee some of the trends which enabled the government to contemplate transferring YTS to local TECs. They

76

The politics of the training market

foresaw the dominance of employers, the need to convert young employees into trainees engaged in a structured training programme, the changing demography which would allow employers less choice in their recruits, the need to train (and so retain) employees and the trend towards adult training assuming a greater prominence in the 1990s. There is little concrete evidence to support the actuality of declining standards, but there is some evidence that the rise in importance of the National Council for Vocational Qualifications (NCVQ) since 1987 has reduced the salience of the YTS Certification Board which enjoyed some brief prominence for a period in the late 1980s. Its purpose was to develop vocational qualifications which were nationally recognized, covered all occupations and sectors, and reflected occupational competence based on the needs of the workplace (including transfer skills and personal effectiveness). To this end the MSC was anxious to devise arrangements to capture competences within locally important sectors and occupations.78 In the two-year scheme there were also arrangements to ensure that trainees’ achievements were recorded against a list of competence statements on a standard YTS certificate approved by the Certification Board. New directions in youth training Clearly the MSC wished to maintain a close review of YTS practice to promote higher standards, and yet it also sought to develop new relationships with the ATOs as a step towards increased employer ‘ownership’ of YTS. This somewhat ambiguous tone emerged in the guidance manuals which it produced for ATOs. While ATOs were to be responsible for the delivery of YTS, the MSC emphasized that they must fulfil certain requirements to secure and maintain ATO status. These included the pursuance of equality-of-opportunity policies to avoid occupational stereotyping and discrimination, the promotion of enterprise awareness and business skills, the analysis of the existing achievements of young trainees, the existence of effective arrangements for programme review and the capacity of ATO staff to understand and use the training cycle. An appreciation of the training cycle implied that ATO staff should be able to investigate training need, design and conduct appropriate training programmes, evaluate the effects of training on both the individual and organization, know the role of assessment systems and methods in YTS and apply new technologies in delivering training (such as open learning).79 Ultimately the MSC preferred to stress its monitoring and quality-control role, however, rather than cede independence to employer-led organizations: Particular attention will be paid to the identification of the roles and competences of ATO staff. This is an area which the Training Standards

The MSC in its glory

77

Advisory Service will be making a high priority in their inspections’.80 If the TECs place more emphasis upon employer responsibility and less upon standards monitoring, this is consistent with a diminished and slight trade union role on TECs, since the TUC claimed credit for the new emphasis on standard-setting and monitoring in the two-year YTS. There are grounds for doubting whether the shift towards employer responsibility, either under the MSC or the TECs, can deliver a sufficient level of YTS activity. Clearly, the general direction of policy in favour of free-market initiatives, and of increasing the financial responsibility of employers, is challengeable in the light of the record of employers and the reduction of economic activity at the start of the 1990s. Chapman and Tooze argue that the YTS: type of training unlike, for example, more formal apprenticeships, is ‘general’ in that it can be transferred between jobs and between companies, and, therefore, any employer who participates in the scheme voluntarily and at his own expense is likely to be subsidising those employers who choose not to get involved, and the poaching of skilled manpower could eventually undermine the whole basis of YTS.81 There appears to be a growing recognition of training responsibilities, at least at a rhetorical level, on the part of employers at the start of the new decade; and it is possible that the TECs may have a galvanizing effect. The need for progress is enormous, however, and the very uncertainty about employer commitment and the adequacy of free-market approaches is sufficient cause for concern. Chapman and Tooze offer some convincing recommendations about the direction that YTS policy should take, and it is striking just how far it diverges from that implied by the principles of the TECs. They call for a more positive approach by the government. Their emphasis upon the need for industrybased training along the lines of the old ITBs, manpower planning through the efforts of a national training authority, government financing, and greater attention to demand-management of the economy to create employment prospects, flies in the face of much of what the government has embarked upon at the beginning of the 1990s. They argue that manpower planning could be more effective with: a system comparable to the Industrial Training Boards (ITBs) whose detailed knowledge of the demand for skills in their own particular industries would be invaluable. YTS trainees who had been certified at the end of their first year could be dovetailed into ITB-organized courses

78

The politics of the training market

to complete a further year of more industry-related training by the age of eighteen. Cross-sector skills could be co-ordinated through a central agency like the MSC.82 Training should also be government-financed. They also suggest that while a concentration upon such supply-side factors as training is understandable, it should be combined with policies which address the issue of demand: There may be an argument for improving the skill level of the labour force but the returns on this investment will be largely wasted if manpower planning issues and the demand side of the economy are given a low priority.83

From YTS, to YT, to training credits It is now necessary to draw the arguments about YTS together and to pick out some central issues. It must be recognized that a short discussion cannot cover all aspects of the scheme, but it is valuable to build an overall evaluation around the criticisms made of YTS, and to differentiate between those accepted by the MSC and those which they refute. Many of the criticisms are of a highly ideological nature and can be treated with some scepticism. Marxists and left-wing trade unionists and socialists have advanced a familiar series of objections. Their criticisms were advanced at the 1983 TUC Congress, where some accused the TUC of class collaboration and upholding the government’s unpopular employment policies.84 They are built around the complex of ideas which assumes a crisis of capitalism, the victimization of young workers who lack skills, the exploitation of young people as cheap labour and their cynical indoctrination into work-discipline in case the economic system should require them in the future.85 The problem with such arguments is that they are over-determined by ideology, fail to notice the economic and labour-market realities of the period when YTS was introduced, and assume boundless resources to create perfect training arrangements. Some criticisms have been acknowledged by officials in personal interviews. Sir Geoffrey Holland accepts that YTS has cut youth wages, but considers that to have been a positive effect. Unduly high youth wages are inflationary, and financial rewards should go to young people who have secured valuable qualifications. He fears for the impact of the tighter labour market of the 1990s upon inflation and training. Other officials also believe that if YTS had a deadening effect upon the growth in wage rates this is of benefit to the economy. Yet these officials can also be said to be adopting an ideological approach. On the criticism that YTS is an

The MSC in its glory

79

inferior training programme with a negative image, officials admit that the attractiveness of YTS has largely been a function of different local labour markets. In the south-east YTS has proved attractive where it vies with other opportunities, whereas in areas of higher unemployment (such as the northeast) there has been a good deal of resistance. There have been a number of serious objections to YTS, based upon pragmatic considerations and from within the scheme’s own norms. A.G. Watts asserts that the MSC was favoured as an instrument to deliver YTS because it was unfettered by financial constraints, unlike the education system, and that, in contrast to a locally controlled service with a strong tradition of professionalism, it could implement policy rapidly as required.86 The rapidity of implementation was of particular interest to the Conservative government at the point at which YTS was set up, because it provided ways of occupying young people and instilling work discipline without interfering with macroeconomic policies. While it is difficult to contest some of Watts’s arguments about the responsiveness of the MSC to state direction, particularly after 1982, MSC officials reject the interpretation. They stress that such an interpretation is too mono-causal in character, and that the MSC ensured a substantial training component even in schemes where the intention was short-term and political. A further criticism is that of Dr T. Johnston that the MSC can only be said to offer better training than other organizations because of the failure of governments to invest in education, and of employers to invest independently in their own employee’s training. As a result: ‘the MSC has . . . had to act as a fire-fighting agency to solve problems’.87 MSC officials tend to argue that further investment in the education system rather than in the MSC would be of limited value, since the system is operated in the interests of educators rather than trainees. They maintain that YTS has innovated a number of useful student-centred educational methods. Echoing the Thatcherite ethos, which was dominant in the mid to late 1980s, the MSC suggested that the LEAs are producer- rather than consumer-orientated. Connected to this controversy is the comment that YTS has merely had to plug a gap created by the reality that ‘the UK is one of the few industrial countries in which the majority of 16 year olds try to enter the labourmarket’.88 So the scheme tackled the issue of motivating young persons for whom the conventional school system has been demotivating. One of the most repeated criticisms hurled against YTS has been that it has involved labour displacement of older workers through the substitution of young trainees. An independent study undertaken by the Department of Applied Economics at Cambridge University demonstrated that some companies do take advantage of YTS, and that trainees replaced employees.89 They also discovered the ‘deadweight’ factor, that trainees merely were taken on in place of an employee so that no new opportunities were created. But

80

The politics of the training market

256 firms were also identified which took on youths only because of YTS, and there were also cases where displacement involved two trainees replacing one employee. In support of Sir Geoffrey Holland’s defence of YTS and its impact upon wages rates, the survey discovered that new places were created because ‘YTS encourages firms to take on young people earlier than they would do otherwise, by reducing the costs of hiring them’.90 In short, the extent of ‘deadweight’ and the substitution of YTS trainees varied across industries. A further and related charge, therefore, that the YTS created a surrogate labour market addressing only the short-term labour needs of employers, requires a varied response. There was, in fact, a triple labour market consisting of young employees, trainees on reputable schemes with good prospects of employment or further training and a surrogate market with exploitative practices.91 There are grounds for scepticism about both the statistics issued by the DE and the MSC on the one hand, and the scheme’s critics on the other, concerning the subsequent fate of trainees, and its implications for the quality of YTS schemes. A similarly mixed response is required with reference to issues of health and safety. As late as December 1988 there were reports that safety standards on the scheme left much to be desired. It was reported that at least one in every thousand 16- and 17-year-olds can expect a major injury, and that, while the YTS had twenty inspectors, they had to examine the workplaces of more than 435,000 trainees. It was further argued that since it was training agents who set up work placements and were paid pro rata, they were unlikely to undertake full health and safety checks. One trainee, Andrew Beetam, argued that it was not worth trainees risking their lives for a training scheme that would not give a job in the end.92 The problem with such journalistic evidence is its anecdotal character. Both MSC propaganda and the criticisms of its opponents provide a selective and partial account of the totality of YTS. In conclusion, it is evident that YTS has made an impact, as its officials claim, in increasing the orientation of employers towards training. Employers who have recruited trainees on YTS have been affected in such a way that the training ethos has often come to pervade their entire organizations. YTS was also a dire necessity in the early and mid 1980s after the recession decimated the number of apprentices, and it was soon exploited to provide a more effective competence-based training. Reform was particularly evident in such areas as the agricultural and engineering industries, where proper modularized training schemes were introduced in place of the narrow timebased apprenticeships. Yet while YTS can claim a far higher throughput of young people and a better gender balance than was achieved by apprenticeship programmes, it still fell far short of the aspiration enshrined in the 1944 Education Act, but never implemented, that all young employees be guaranteed a day off work per week for appropriate education and training.

The MSC in its glory

81

This was the demand of the National Association of Teachers in Further and Higher Education (NATFHE). NATFHE’s demand was not radical, as it reflected European practice. It does reveal, however, that even if YTS is preferable to apprenticeships, it is not superior to the practices of other countries in the European Community. The YTS Funding Study (which has already been discussed) pointed to a doubtful future, and Norman Fowler told the CBI conference in November 1989 that TECs might change youth training practice. The CBI itself prefers training vouchers, thus empowering the trainee to cash in his/her training subsidy in any manner the individual considers most valuable, thus replacing statism with a training market. With the emergence of the TECs, the new label of Youth Training (YT) has been introduced. The official metamorphosis took place on 29 May 1990, and funds were earmarked for the purpose. Certainly, one local TEC intends to utilize YT in a substantial manner, but in the context of the employed trainee status rather than in the 1980s image with its unemployment associations. Its goal is to provide youth training for all young people, and to improve access for all 16-year-olds. The link between the Calderdale and Kirklees TEC and Huddersfield Polytechnic may be an example of the new form of YT. Its purpose is to prepare school leavers for later opportunities to gain qualifications in higher education. Whether the demographic changes of the 1990s and the corresponding tightening of the youth labour-market lead to a better YT scheme remains to be discovered. Youth unemployment should not pose a problem in the later part of the decade since there is an ageing workforce. Optimists at the DE continued to argue in the early 1990s that a surplus of places would enhance competition among employers, thus raising the standard of the training delivered. The longer-term survival of YT appeared to be in jeopardy when, in response to vigorous questioning at the House of Commons Employment Committee in March 1990, the new Secretary of State for Employment, Michael Howard, defended a decline in government expenditure on it with the arguments that youth unemployment had fallen, demographic change reduced the importance of youth training, and employers should bear a greater burden of the costs involved in training their workers.93 By that stage there were signs that policy-makers were considering the CBI recommendation for training credits, rather than seeking to entice young workers on to YTS schemes through the employed status initiative. Yet Employment Minister Patrick Nicholls welcomed YT in 1990 with the statement that it would equip young people with the knowledge and skills to have successful and rewarding careers at work. He stressed the ending of the standard design framework in favour of individually tailored schemes of flexible durations, with TECs free to arrange the most appropriate levels and incentives with their local training providers.94 In the first instance, as

82

The politics of the training market

training credits are to be confined to a limited pilot experiment, their extension is almost certain. Whatever happens to YT, however, two judgements are certainly warranted about the entire initiative. First, it was so high profile that, to many, the acronyms YTS and MSC are synonomous and its influence on whatever youth training arrangements succeed it will be considerable. Second, while many of the one- and two-year schemes were inadequate, and often involved poor training and suspect managing agents, YTS achieved a great deal in a short time, and only an organization such as the MSC had the capacity to deliver it in the circumstances of the 1980s. THE MSC: OTHER INITIATIVES There is no doubt that the MSC’s priority after 1981 was with young people. If, as Ainley and Corney argue, the MSC was engaged upon a cultural revolution in order to create an enterprise culture in Britain, then they are also right to assert that ‘new entrants to the labour-market were the obvious people with whom to begin the new cultural revolution’.95 If the YTS was the centre-piece of this strategy, the TVEI was also important as it allowed the MSC to influence the schools as well as the vital bridge from school to work. The TVEI was also introduced to help achieve a central MSC objective, that of encouraging employers to invest directly in the training and education systems. The auguries from the TVEI experience were discouraging, however, because despite the fact that Norman Tebbitt was well received at an Institute of Directors meeting when he urged delegates ‘to go into schools and tell them what you need’, employers still resisted the ‘temptation’ to invest their own money in areas which they considered to be a public responsibility, and from which they would derive little direct benefit. 96 Yet the idea of enthusing employers to invest resources in training was a part of the MSC’s wider aim of creating a new training culture in Britain, with itself fulfilling the unofficial role of a ‘Ministry of Training’. The MSC’s activities in this period can be interpreted from quite different perspectives. Thompson and Rosenberg, for example, presented a straightforward guide to the MSC’s work, and described the purposes of the various schemes and programmes, accepting their aims and intentions at face value; whereas Ainley and Corney probed beneath the activities to tease out ulterior ideological motives. While it is necessary to do so, because apparent relationships are frequently different from real ones, it is necessary also to consider such issues as the objective need for MSC type activities to respond to the economic and labour-market crises of the time, and to pay attention to the practical limits of public expenditure. There is little virtue, therefore, in measuring MSC schemes against a ‘pure’ ideological

The MSC in its glory

83

standpoint, which ascribes motives to policy-makers which they fail to recognize themselves. Thompson and Rosenberg are correct to say that it is difficult to obtain any overall view of the MSC’s work for much of the 1980s: because of the sheer diversity of the schemes, as a result of which even the organization’s front-line staff lacked a true conspectus; but also because of the frequent changes, in which initiatives were introduced, withdrawn, tested and modified at a bewildering rate.97 Thompson and Rosenberg also criticized the MSC because it was centralist, lacked local accountability compared to local authority further education, and because (as the ground rules for MSC programmes were nationally set) it was a monolith.98 They also advanced a further criticism, when, in recognising the MSC’s identification of a serious training lag in Britain compared to competitor nations, they blamed the MSC for not tackling the matter of placing legal obligations upon employers to train all young employees. They argued that this was necessary because 45 per cent of young workers received no training. Finally, they detected piety rather than realism in the MSC’s description of training at a time of high unemployment as ‘a continuous process leading, for all, to work’. Thompson and Rosenberg asserted the MSC’s importance, as it was then constituted in 1986, defining it as the most influential quango, since it ran the nation’s employment and training services. They correctly pointed out that the fluidity of the MSC’s many schemes, many of which have since disappeared or been modified out of existence, makes a complete account of the MSC’s work from 1981 to 1987 rather valueless. It is more useful, however, to take a ‘snapshot’ of the organization’s activities at a specific date, and January 1986 is a good moment to choose because the MSC was then at its most active. The Commission in January 1986 comprised: the chairman, Bryan Nicholson; M. Bett, M. Bury and J.M. Peake of the CBI; K. Graham, R. Grantham and R. Todd of the TUC; Professor K. Durrands, the rector of Huddersfield Polytechnic (representing education); and B. Vaughan of the local authorities. The MSC’s director was Sir Geoffrey Holland. Its expenditure during the previous financial year had been £2,065.8m., of which more than 80 per cent was transferred to individuals and organizations. The Annual Report also demonstrates that the YTS was dominant, accounting for £850m. of expenditure, with the Community Programme (CP) costing £534m., adult training £215m. and Jobcentres £130.6m. of the budget.99 It is noteworthy that not all the money came directly from the Treasury, since in 1985–6 over £225m. was received from the European Social Fund. A little later the EC funding was under threat because of the nature of government direction of the content and organization of the specific detail of many of the schemes. Compatible with the attempts of the Thatcher government to ‘slim down’ and reduce costs, however, the number

84

The politics of the training market

of MSC permanent staff had fallen back from 26,000 in 1979 to 20,803 in April 1985. At this stage there were already strong critics of the MSC’s performance who argued that the issue of the need for legal obligations upon employers was important given that 45 per cent of employees received no training.100 The MSC’s adult training strategy at this time was in a process of flux. Clearly TOPS was coming to an end, to be replaced by the Job Training Scheme (JTS) which was an industry-orientated scheme of training for identified employment requirements. TOPS was widely condemned by the MSC by this time because it failed to strike the right balance between skill requirements and was not adaptable to local needs. It is an irony that TOPS was a market rather than a planned approach to training, and rather like the training-credit system, it placed decision-making power in the hands of the recipient. The JTS, on the other hand, was posited on the assumption that the MSC bureaucrats knew best, albeit informed by their own local labour-market intelligence which in turn drew from the knowledge of employers. The market element of the policy was confined to the refusal to reduce the employers’ own responsibility for investing in the development of the skills of their workforce. Through adult training awareness campaigns and the bi-monthly publication Focus on Training, the MSC hoped to inculcate employers with the understanding that training was not simply a once-and-for-all activity in youth.101 The MSC was busily restoring its relationships with eductors, trainers and local government at this time, in the aftermath of its controversy over the 1984 White Paper, Training for Jobs, which has already been discussed. The entire dispute is revealing about the nature of British politics generally and of the political style of Thatcherism particularly. Despite the possibility of intra-Whitehall political struggles in the system, the remarkable unanimity which a strong prime minister was able to impose is striking. Certainly, with a Thatcher loyalist such as Sir Keith Joseph at the DES, the defence of FE interests was almost entirely absent. It is also apparent that in the desire to challenge the post-war Keynesian welfare state consensus, the Thatcher government was ready to extend the state’s activities with the use of an ad hoc body such as the MSC, even though it was a body based upon legislation, as a step towards the ultimate creation of a market in training. The anger of the LEAs and their associations reflected their understanding that this was a part of a project to undermine their traditionally devolved powers, and they were particularly sensitive because of earlier disputes about the funding of higher education which had ended in the compromise of the National Advisory Body (NAB) on higher education. Four years later after a third Thatcher election victory, the LEAs were much less minded to take on the government despite the more serious challenges to their role through the

The MSC in its glory

85

removal of FE colleges from their control, a reform partly motivated by the crisis in local authority finance in the aftermath of the failure of the poll tax, and the creation of the business-led TECs. The MSC’s organization in 1986 was split into divisions, such as the training division, the employment division, the skills training division and the TVEI unit, under the control of the Director. It was supported by two further structures, however: those of (a) personnel and central services; and (b) planning and resources. The MSC attempted in the mid 1980s to develop equal opportunities policies, with particular relevance to the needs of women, the disabled and the ethnic minorities. The motive was clearly economic rather than social, as the main intention was to exploit the full range of adult skills and employment potential in the wider population. This is not to undermine its importance, however, since the disadvantaged in society are more likely to desire normal treatment and the chance to become economically productive than they are to favour patronage. The MSC’s training division undertook a good deal of proselytizing work, as with the publication of the document No Barriers Here. The document was based upon action research into the main factors in organizations which limit women’s opportunities to become managers. It argued that while talent was equally distributed between the sexes, women were underrepresented in the senior levels of management. Since people are the main asset of employing organizations, such employment costs as recruitment, salaries and training are significant budget items. Women tend to be channelled into support or specialist roles which offer little opportunity for development, so the MSC urged that each organization should look at its own situation, and design programmes of action for its own specific needs. Personnel managers and others were urged to be more proactive in encouraging awareness about the type of role which women could play. Organizations should avoid the protective attitude towards female staff which is more the norm than is overt discrimination, and women should stop defining themselves in terms of their weaknesses and be more ready to define their strengths. Organizations should recognize that women tend to ‘wait and assume that promotion will be the reward for ability and competence in their current job’.102 The MSC also promoted a code of good practice for the employment of disabled people. Once more it produced manuals aimed at directors and senior managers who are responsible for policy decisions within the company, and argued that it was both prudential for the companies as well as simple justice that the capacities of disabled people be utilized. Companies were urged to produce policy statements about disabled people which should comprise a set of realistic objectives which fit the circumstances of the particular company

86

The politics of the training market

and communicate the policy to all their staff. The MSC document, Code of Good Practice on the Employment of Disabled People, indicated the possible lines which a policy statement might follow. These included: ensuring that disabled people who applied for posts with a company knew that they would receive fair treatment; looking after people who become disabled to guarantee that they be retained in employment; and developing the skills of disabled people so as to offer them training for promotion opportunities. To provide an incentive, the MSC ran a ‘fit for work’ award, in which a 100 awards were made to employers who had done most, to show that their efforts were valued in the community at large.103 It is possible only to offer a brief resumé of the bewildering array of the schemes and programmes which emanated from the MSC in this hyperactive phase of its development. In 1986 it operated such initiatives as the Management Extension Programme, Access to Information Technology Courses, the Enterprise Allowance Scheme, Local Grants to Employers, Open Learning Programmes, Local Collaborative Projects and special guidance to jobseekers. It is significant that some of these initiatives were linked to the MSC’s employment responsibilities, and that they are not easy to differentiate from training initiatives. This demonstrates the initial wisdom of uniting training and employment activities under the aegis of the same organization, and of the inextricable connection between the two responsibilities. It appears to have been a retrogressive step, therefore, when the employment service was removed from the MSC’s sphere in the aftermath of the 1987 General Election. The Management Extension Scheme was intended to assist unemployed managers to secure intensive off-the-job training and a period of secondment to a small firm to help a small business develop and grow. This was a useful process of matching up the skills and experience of unemployed managers with the needs of small businesses with ideas for growth but lacking the resources to carry them through.104 The Access to Information Technology courses were designed for employed, unemployed and self-employed alike. Local area offices provided information about courses, which cost £1 per hour in 1986, and they were variously provided by colleges and training centres, and provided ‘hands on’ experience.105 The Enterprise Allowance Scheme (EAS) was to assist the unemployed to start their own business. To be eligible it was necessary to be in receipt of unemployment benefit (so the manipulation of the unemployment figures appeared to take precedence over both economic and humanitarian considerations in this regard) and to have been unemployed for more than eight weeks, have at least £1,000 available to invest in the business and to have a business idea which the MSC felt able to approve. The business naturally had to be new. The scheme was administered by specialist staff in seventy-five Jobcentres, and new businesses

The MSC in its glory

87

receiving support obtained a weekly allowance for a maximum of fifty-two weeks. The MSC also provided, under the aegis of its Training for Enterprise scheme, a range of appropriate training courses. MSC publicity at the time made it clear that the receipt of an allowance did not imply any judgement that the business was likely to succeed.106 This was prudent, since many of the businesses which were established failed, although the precise rate of failure was a highly contested issue. Local grants to employers took two main forms: local training grants (LTGs) which offset a proportion of the costs of training employees and new recruits; and local consultancy grants (LCGs) which offset a proportion of the cost of purchasing specialist advice to analyse training needs. The MSC expressed two aims in the provision of LTGs to employers: first, to demonstrate that investment in well planned and delivered training to meet clearly identified needs can create a flexible and competent workforce able to improve business performance, and, second, to help firms with little past commitment to training to cope with changes such as new work methods or changing markets. There were many conditions laid down before training grants could be provided, and the scheme was discretionary. In particular, the applicant company had to demonstrate that a need existed, and that the proposed training investment was new. Naturally enough, therefore, the scheme was concerned to avoid the ‘deadweight’ problem. The scheme was also open only to private employers. Priority was given to new applicants rather than to those firms seeking a repeat grant. Such considerations highlighted the ‘pump priming’ catalytic role which was MSC ideology at the time.107 The guidance notes to applicants for local grants demonstrated the impact of managerial thinking on the operations of the MSC, although some critics might suggest that they reflected the Civil Servants’ traditional preoccupations about accountability and evaluation rather than the considerations which commercially experienced businessmen and professional trainers might emphasize, such as the benefits that they could bring. There is little doubt but that the MSC was energetic and innovative, and this brief description does not exhaust the full range of its schemes and programmes. The question must remain, however, whether this mass of independent, and not always co-ordinated initiatives amounted to a comprehensive strategy. MSC RESEARCH UNIT As it matured organizationally the MSC became more actively committed to research. It developed increasingly sophisticated procedures for determining labour-market tendencies. Much of the research was undertaken centrally, although the MSC also used regional and local offices to good avail, and

88

The politics of the training market

employers were frequently advised to consult MSC regional offices when they required information and advice about local labour markets.108 Before they were reorganized in 1978, both the ESD and the TSD supplied information on many diverse subjects, such as employment and unemployment, training, labour mobility, labour costs and productivity and other matters connected to the labour market. The Manpower Intelligence and Planning Division (MIPD) also carried out special labour market studies. Each regional director also had a small team, the regional manpower intelligence unit (RMIU), which collected, analysed and disseminated information on regional labour markets.109 In the financial year 1986–7 £7m. was spent on research out of a total budget of £3.6b. The best research according to many of those engaged in the research division was concerned with evaluation. The main notion underpinning this research was to modernize training arrangements, remove barriers to employment, raise standards, enable accreditation and adopt new technologies. Reflecting the dominance of YTS within the organization’s priorities, which was itself the consequence of the high political profile of young people in the labour market in the mid-1980s, much of the evaluative research was linked to quality control of youth service provision, and included an examination of the responses of trainees and employees. Research also aimed to help improve the infrastructure, in terms of enhancing the mechanisms for co-operation between government, educators and industrialists. The research unit also focused upon the skill requirements of local and national economies so as to target MSC operations more effectively. Finally, it examined international developments for comparative purposes, particularly to demonstrate the linkage between investment in training and competitive performance.110 The MSC also relied heavily upon others to produce analyses, and it drew substantially from the research of the Institute of Manpower Studies at Sussex University. It also used the work of the Further Education Unit (FEU) which was the source of many of the ideas about skills, competences and profiled assessments.111 The accumulation of knowledge about labour-market trends proved to be so valuable that the government was anxious that the TECs continue this work. SUMMARY A number of major conclusions emerge from this review of the MSC from 1981 to 1987. This period marked its most active phase, but while there were useful links between particular training and employment initiatives, the full range of programmes was too vast to retain coherence. The YTS dominated the budget and the image of the organization, and at the outset of the period substantially explains why the MSC was retained by the otherwise

The MSC in its glory

89

economically ‘hands-off’ government of Margaret Thatcher. The tripartite status was not synonomous with a corporatist arrangement, and the trade union representation was largely legitimizing in character. The confidence which the MSC displayed in 1986, at what appeared to be its peak, must not conceal the reality that the government was committed to its own objectives, and regarded the MSC as a transitional organization to create the conditions for a training market to be established. Yet even if the MSC was too complacent in 1986 about its position, its administrative and labour-market role should not be forgotten, and much of the work of the TECs is involved with the continuation of much of the MSC’s best efforts. The area of adult training which figured in the NTI of 1981 has been little discussed in this chapter. This is because it is to be explored at greater length in the next chapter, which covers the period after 1987, when it became a highly contentious issue.

4

After the MSC From Training Commission (TC) to Training Agency (TA) 1987 to 1990

It was ideology and politics rather than a desire to improve training which explains the complicated organizational metamorphoses which occurred between 1987 and 1990 in the British training market. In brief, the change from Manpower Services to Training Commission was motivated by the political consideration of removing the Employment Service back into the Department of Employment, and the change from TC to TA in 1988 resulted from the government’s impatience with what it perceived as growing trade union obstructionism on the MSC. It is necessary to examine the period because training programmes and initiatives continued, and it is valuable to analyse the political forces which underpinned the unusual organizational discontinuities. So far as training programmes are concerned, the period is dominated by the Employment Training (ET) controversy. It was the controversy about ET which led directly to the decision to remove the Commission and to change the organization’s title to the Training Agency. If the period from 1981–9 was marked by governmental experimentation with supply-side economics, through a state-led initiative to address the national skills shortage problem, the apparent failure to solve the problem produced an ideological reaction in favour of an employer-led free-market approach. THE RISE AND FALL OF THE TRAINING COMMISSION The MSC was formally converted to the Training Commission (TC) by Royal Assent on 23 May 1988, although the transition was gradually effected from the 2 October 1987. The then Secretary of State for Employment, Norman Fowler, argued that the organization would be better able to concentrate upon its training responsibilities, if its work in the field of employment services was transferred back to the DE, where it could more suitably be handled by a specific departmental unit. Such a return could permit the reuniting of the unemployment benefit offices and the Jobcentres into a single organization. Fowler justified the change on the grounds of administrative rationality, which

After the MSC

91

is curious since it was man- agerial efficiency which had been invoked when the employment and benefit activities had first been separated with the MSC’s establishment.1 Despite this inconsistency, the minister’s reason for ‘bringing JCs and UBs into a single organization is to give more effective help to unemployed people than it is possible with the present division of these services between the two separate organizations’.2 So the government’s argument in 1987 was that ‘a close working relationship between the two sets of offices and their staffs can be beneficial to the unemployed, especially the long term unemployed’.3 The arguments would be more compelling were it not for the fact that an earlier Conservative government equally claimed to be acting on the basis of managerial efficiency when it originally united employment and training services in the MSC in 1973. While the new Conservative government which was elected in 1987 considered that its own direct control of the employment services was rational, it remains noteworthy that the bringing together of Jobcentre and unemployment benefit activities was justified on precisely the same grounds of effective service delivery which were advanced in the early 1970s to argue for their separation. There are some clear implications in the development of this issue for the debate among public-policy theorists on the respective merits of rational and incremental theories. The fluctuations in policy undermine the case for rational theories. By pursuing directly contradictory policies on the issue, yet justifying them with the same claims about the efficient delivery of services, governmental behaviour produces scepticism about the role of managerial efficiency in government. And the possible explanation that the Thatcher government was acting rationally in rectifying an earlier error is undermined both by the proximity of the arguments which were adduced on the two occasions, and by the fact that in 1987 other EEC governments, such as Eire and Holland, were linking job-seeking activities to training provision under the aegis of their respective national labour-market organizations. Policy analysis took a poor second place, however, in Britain. While rational approaches to the policy-making process are weakened by such episodes, an explanation rooted in the impact of ideology is correspondingly strengthened. This is not to disregard the serendipitous element in governmental reorganizations, or the desire of governments and Secretaries of State to make a mark by tinkering with the machinery of government. It is also true that the discipline of business management is itself prone to fashion, thus the subjection of government organization to its proposals is no safeguard for continuity. Ideological preferences appear to have been paramount, however, since the ‘technocratic’ approach in vesting employment and training alike in a semi-independent and specialist Commission reflected Edward Heath’s approach. The Thatcher government’s reversal of a 15-year-old organizational arrangement was

92

The politics of the training market

motivated by its desire to reduce the power of a statist organization which, in its tripartite commission, appeared to be a legacy from the pre-Thatcher 1970s. It also had a short-term motive in seeking to put greater pressure on the unemployed to leave the unemployment registers and to be entitled to benefits only if ineligible for work or training programmes. The government’s introduction of the pre-election Restart programme in January 1987 required that the long-term unemployed be summoned on a sixmonthly basis for interviews at Jobcentres to ensure that they were available for work, and so were not ‘dole-scrounging’. The reuniting of the employment service with the unemployment benefit offices better enabled ‘the policing of benefits’, whereas under MSC management the main purpose of the Jobcentres had been to serve the clients.4 By contrast, the Heath government, and certainly during its post-U-turn phase from 1972 to 1974, was less averse to interventionist solutions, and to trade unions being involved in the policy-making process. So the changes in the organization of employment and training services resulted not from Civil Service power, but from the impact of the governing party upon policy outcomes. The fact that both forms of organization resulted from Conservative governments does not invalidate the argument since, as Nigel Harris has argued, a dualism is evident in recent Conservatism between liberal and more ‘corporatist’ approaches.5 Clearly, the ‘corporatist’ element was waning after the early 1970s. The creation of a special unit within the DE to administer employment services at the time had only a fortuitous link with the report of Sir Robin Ibbs, The Next Steps. Some three years later, however, the Ibbs report led to the creation of the ‘hived off’ Employment Service. The report was largely written by Kate Jenkins, who was a researcher for the Ibbs Efficiency Unit, and although it was delivered to the Prime Minister before the 1987 General Election, it was February 1988 before Thatcher announced her intention of implementing the idea of setting up agencies within the Civil Service to carry out particular functions.6 She accepted the report’s proposal in order to challenge the Civil Service machine and other public sector monoliths, by an arrangement in which: service delivery undertaken by departments, should be carried out by executive units clearly designated within departments, referred to as agencies, with responsibility for day to day operations delegated to a chief executive responsible for management within policy objectives and to a resources framework set by the responsible minister.7 The Employment Service would have provided a good pilot as it constituted the biggest agency with its 2,000 local offices, 40,000 civil servants and a

After the MSC

93

£6m. a year budget. Yet The Guardian was both more and less accurate than it imagined. It predicted that the organizational autonomy of the Employment Service would prove impermanent since Whitehall ‘has a ally succumb to sticky ministerial embrace’ as with the MSC itself.8 Yet history of setting up independent, autonomous agencies . . . which eventuuntil the spring of 1990 it appeared that the service was not being transferred after all. Perhaps the ‘sticky ministerial embrace’ was such as to delay the transfer which only took place on April 2. Its first director, Mike Fogden, attempted to justify its creation with the argument that job-seeking and benefitpayment services should be combined in a ‘one-stop office’. The Employment Service assisted recruitment into the ET and EAS schemes, and it would work with TECs: to ensure that TECs have a ready made facility for bringing their wares to the attention of key client groups . . . Some TECs have already approached area managers to obtain labour-market information and we are ready to help other TECs who may wish to make similar requests.9 Yet the need for closeness between employment and training services had been the rationale for linking the two formally, under the aegis of the MSC. Progress appears to be lateral. There were varying views within the MSC about the organization’s loss of the Employment Service, and a minority of officials appeared to think it rational, but the majority perceived a threat. It was this second judgement which proved to be correct. The change represented a decline in the organization’s popularity with ministers. Sir Bryan Nicholson, the MSC’s chairman, expressed his regret at the loss of the service and argued that the Department of Education was lucky to inherit an efficient operation.10 Commission members were also reported not ‘to have sought’ the change.11 In private conversation, however, a leading MSC official noted the irony that the Dutch and the Irish had learnt that it was better to separate employment and benefit functions so that Jobcentres could provide a gateway to employment and training, and also observed that the benefit and employment services necessarily had entirely different cultures.12 Yet neither non-political administrative considerations, nor even gratitude, determine political decisions, which, as Seliger asserts, are necessarily rooted in ideological values.13 The officials were correct. The removal of this central function in manpower planning reflected the demise of modestly autonomous tripartite approaches to British labourmarket policy in Britain. In its place a ‘market-sensitive’ form of state centralization was established.

94

The politics of the training market

From the autumn of 1987 to May 1988 the MSC was in the curious position of bearing a name which no longer reflected its true activity. The transfer of employment services occurred in October 1987, but the TC only emerged eight months later. In that time a new structure was set up which, despite the loss of employment responsibilities, remained complex and labyrinthine. Under the British Constitution, an Act of Parliament necessitating a further Employment Bill was required to bring about the formality of the Training Commission (TC). Since the TC was abolished in the autumn of 1988, its existence was brief. It was launched in an official manner, however, with a mission statement, and speeches from its new head Roger Dawe, and its former director (now properly promoted to the permanent secretaryship of the DE) Sir Geoffrey Holland. Its main activity was to switch the organization’s attention to adult training. It is interesting that as prominent a left-wing intellectual as Baroness Tessa Blackstone (described by a leading official as ‘a great friend of the old MSC) publicly, at the official launch of the Training Commission, praised the YTS and other schemes for their practical utility. It is evident from reading annual reports and other publications at this period that there was a widespread conviction that the government’s economic policies were indeed generating an economic miracle, and that in a tightening labour-market there was more of a concern to train employees and to encourage women to return to the labour-market. After a hiatus, the very existence of which demonstrated the DE’s predominance over the TC, a new temporary chairman, Sir James Munn, was appointed. His aim was training throughout life, and Norman Fowler expressed hope that the new TC could bring that goal about by concentrating exclusively on the national training effort. 14 The main focus of the organization’s work in this period was directed, therefore, towards new versions of adult training, and so at last the final point of the NTI was to receive attention. Unhappily, events led to the unravelling of the TC almost before it began its work. These policy changes were parallelled by similar developments at the Department of Health and Social Security (DHSS). There was a close link with labour-market policy here, since the aim was to retarget benefits to those most in need – presumably the Victorian notion of the deserving poor – while the remainder who were able-bodied, but presumably idle, were to be set to work to earn their maintenance. As Ainley and Corney argue, ‘the reform of social security was therefore intended to provide further inducements to the unemployed to take jobs’.15 The MSC had always adhered to the voluntarist strategy, arguing that attitudes towards training should be changed from the bottom up. Increasingly it became drawn into the role of abetting the government view that there was a ‘hard-core’ of long-term unemployed who were addicted to benefits. For that reason the MSC became

After the MSC

95

involved in 1986 in the implementation of the Restart interviews which were intended to drive the work-shy off the register. Yet out of four million interviewees, a mere 0.5 per cent had found employment.16 Following on from the Restart initiative, the MSC next attempted to launch the New Job Training Schemes (NJTS) which Ainley and Corney fairly describe as an unreal programme, based as it was upon work-experience rather than training, and involving merely the payment of benefits. With this scheme and its predecessor, the Job Training Scheme (JTS), the MSC, albeit under the promptings of the DE rather than the commissioners, was becoming guilty of folies de grandeur. With the political mood heightened by the 1987 General Election, it became harder for the trade union commissioners to support policies which were becoming increasingly less plausible. In many respects the Enterprise in Higher Education (EHE) initiative was an attempt to restore the MSC’s standing, given the anticipated decline in the YTS owing to demographic change, and the difficulties which the MSC was encountering in launching effective adult training. While Kenneth Baker at the DES took part in the discussions which developed the idea, the MSC was clearly also trying to develop schemes to demonstrate that it was still needed. The EHE invited higher education institutions (HEIs) to compete for monies with their peers to develop skills and competences among undergraduates. As this initiative coincided with increased funding difficulties for HE, many institutions were anxious to participate. In short, it was a TVEI for HE. The discussions about TVEI, and its suitability for schools, were now replicated throughout HE colleges. While the MSC implemented EHE and ET, however, a series of steps ensured the gradual demise of the organization. Bryan Nicholson did not renew his chairmanship, there was a long delay before Sir James Munn was temporarily substituted as chairman, and his successor Brian Wolfson was appointed on a part-time basis in July 1988. The auguries were similarly discouraging at the level of powers and responsibilities. In addition to losing responsibility for the Employment Service, the MSC lost control of the Enterprise Allowance Scheme, and the Careers and Occupational Information Centre. Although the TC was set up with some ceremony and Sir Geoffrey Holland became Permanent Secretary of the DE and Roger Dawe became the TC’s first Director General, it proved to be a false dawn. The TC’s mission statement is now only of anachronistic significance, and the TC was launched with a major event during which Sir Geoffrey Holland manfully stuck to the old ideology which he had previously expressed: ‘The new MSC is a National Authority, it has a significant contribution to improving the UK’s business competitiveness at home and abroad’.17 Yet in a few months, after the fiasco of the TUC’s rejection of ET, Holland was engaged in the reabsorption of the delivery of training back into the centre, with the creation of the somewhat

96

The politics of the training market

spurious and short-lived Training Agency (TA). It was spurious because it left only a shadow of responsibility for training policy-making at Moorfoot in Sheffield. In reality it left less power with the TA than the Training Services Agency had enjoyed at the time of the MSC’s formation back in 1973. With the TC’s abolition there ended all attempts, based upon partnership, to resolve Britain’s endemic training and labour-market problems. With central control thus apparent, it is evident that the setting up of the Training Enterprise and Employment Division (TEED) of the DE in 1990 was less of a watershed than was the abolition of the Commission announced in September 1988. It was not the detailed characteristics of ET which alone provided the catalyst for the TUC to reject the programme. There were many signals to the trade unions that their continued collaboration in training policy-making was on pure sufferance. These signals included the changing composition of the Commission to enhance employer representation and the changing of the area manpower boards (AMBs) on which unions enjoyed some influence to become mere labour advisory bodies (LABs) with vague responsibility for quality assurance rather than the power to pronounce on individual applications for area training organization (ATO) status. The period from the Conservative victory of 1987 to the December 1988 White Paper (which first proposed to set up the TECs) was dominated by developments in the adult training sphere. Despite the protestations of interest in adult training in the 1981 NTI, it remained a ‘Cinderella’ element in Britain’s training strategy, and thus reflected the status of the education of adults in the education system. When adult training became the top priority after 1987, sadly it too became confused with the need to cope politically with the long-term problem of adult unemployment. It is now necessary to focus in some detail on this important area. THE ADULT TRAINING STRATEGY (ATS) Adult training policy is the first major area which directly involved the MSC in substantial training activities. Other than the TOPS scheme, and before assuming its responsibility under the aegis of the New Training Initiative, the MSC had mainly concentrated on work creation programmes for adults. Until the emergence of Employment Training (ET) in 1988 there emerged a complicated array of thirty-seven schemes devoted to differing aspects of adult training. It is unnecessary to describe each in detail. In this area, as well as in other aspects of training and enterprise initiatives, schemes were introduced, withdrawn, tested and modified in a bewildering fashion. It must be one criticism of the MSC’s devotion to ‘quick-fix instantism’ that even its clients and partners were unable to keep pace with the changes in programmes, and the alphabet soup of acronyms which it generated. The main thread

After the MSC

97

running through this analysis concerns the large schemes which most directly affected public consciousness. These were the Community Programme (CP), and for a while the Job Training Scheme (JTS) and the New Job Training Scheme (NJTS), and finally Employment Training (ET). There was a distinct and clear shift away from programmes crowned with TUC approval, to the ET scheme which offended many of the leading trade unions. Adult training became as politically contentious an area as youth training. ET was different in character from earlier schemes, in that it cut the links with national pay agreements which had operated on the CP and introduced remuneration on the basis of ‘benefit plus’. Adult training developed after 1981 in line with the third objective of the NTI. This was ‘to open up widespread opportunities for adults, whether employed, unemployed or returning to work, that they may acquire, increase or update their skills and knowledge during the course of their working lives’. The decision to create wider opportunities for adults recognized that adults were unskilled, or if skilled were too narrow or rusty. The White Paper of 1981 endorsed the NTI, and the MSC launched its Adult Training Strategy (ATS). This was not a programme, but a set of proposals to encourage the growth of training consciousness among firms and individuals, to improve the system for providing and accrediting training, and to increase collaboration between employers and training providers. Following the government’s White Paper on training in November 1981, the MSC set up an internal group to review current training arrangements, and in April 1983 the MSC produced a discussion document based on the group’s work on the development of a new Adult Training Strategy to secure an adequate supply of people with up-to-date skills to meet new technological demands. This led to a series of recommendations to government in November 1983 for a major initiative to improve adult training, and included the mounting of a national campaign to raise awareness, to improve the coherence of provision, and to restructure the Commission’s own adult training programme.18 The government’s White Paper, Training for Jobs (Cmnd. 9135) endorsed the ATS in January 1984 as being in line with ‘the market orientated approach to training that is now required’, and the MSC’s programmes were restructured in 1985–6, after a pilot programme in 1984–5. It is clear that a major objective, although as so often in policy-making an unstated one, was to increase cost-effectiveness by overcoming known deficiencies in the TOPS and other pre-ATS adult training. There was a particular aversion against the TOPS philosophy of speculative training of the unemployed in response to individual wishes. This was encouraged by the unsatisfactory placement rates of TOPS trainees and the lack of related national and local intelligence about emerging skill needs.19

98

The politics of the training market

Yet the necessary reform of British adult training was, and remains, a major priority, and the swift response of the ATS reflected a political desire to demonstrate that action was taking place. It was a ‘quick fix’ approach to a major problem at limited public expense, rather than a rational plan to tackle the endemic problem. Aware that training provision was more developed in many other countries, the MSC and the National Economic Development Office (NEDO) sponsored research by the Institute of Man-power Studies which resulted in the report Competence and Competition in 1984. The main thrust of the report was that both public authorities and private employers in Britain took a far less direct role in training than in other countries such as West Germany, Japan and the USA. A year later a Coopers & Lybrand study, A Challenge to Complacency, found that companies did not know their expenditure on training and concluded that insufficient employers considered training to be of major importance. As it increasingly involved itself with adults, the MSC at first enjoyed poor relations with the adult education policy community, and adult educators were irritated that the scant public resources available for the education of adults were largely directed towards the MSC. The domination of the DE over the DES for a period in the mid-1980s led many adult educators to turn their attention to the MSC as a prime source of funding. The ‘liberal adult education’ sphere was small, and so the DE acknowledged the DES’s prior claims for control in that particular area. This settlement of an intra-Whitehall conflict was assisted by another convergence. Just as adult educators were turning their attention away from recreational or liberal education towards a concentration on the educationally underprivileged, so the MSC was acquiring an interest in basic education and training in order to equip the adult unemployed for a role in the labour market. Thus adult educators became adept at presenting their educational projects in terms that the MSC would consider acceptable, and organizations such as the Adult Literacy and Basic Skills Unit (ALBSU) were strongly approved of by both. The consensus which slowly developed, however, masked some substantial differences. Most adult educators, for example, had a social mission, and considered the educationally underprivileged as victims; whereas the MSC had a deficit model and considered that such adults required basic education to tackle their inadequacies. Similarly, the MSC set up an Equal Opportunities Unit in 1984, but its motive was unashamedly economic rather than social, as it wished to tap the potential talent in the ranks of the ethnic minorities, the disabled and women. By contrast, many radical adult educators were interested in politicization, or as they preferred to describe it (pace Freire) conscienitization.20

After the MSC

99

The MSC had taken steps to consult adult educators and other interested organizations when it prepared its strategy in 1983. Policy consultation is not to be confused with the existence of a policy community or a policy network, however, since, as is demonstrated in Chapter 6, the demands implicit in the reality of a policy community are considerable. Consultation there may have been, but there was little doubt as to who was in the driving seat. The MSC ensured a wide circulation of its discussion document by sending it to over 700 organizations. The document addressed the issue of how to implement Objective 3 of the NTI. The labour-market focus of the MSC’s approach to adult education and training was evident in its decision to replace the TOPS scheme – on the grounds that while it provided training for adult returners to the labour market it failed to address the needs of particular local employment situations. The general approach of the MSC became clear in its statement on adult training in July 1985. This ended the TOPS scheme and replaced it with the Job Training Scheme (JTS) which was an industry-related scheme of direct job-related training aimed at identified employment requirements; and the Wider Opportunities Training Programme (WOTP) which were orientated towards the unemployed and to those on the Community Programme. So the MSC was concerned to focus adult training towards newer skills and anticipated local vacancies.21 As the importance of adult as well as youth training slowly dawned upon the MSC, the JTS and WOTP schemes aimed to increase the number of adults which the MSC assisted to train, from 220,000 in 1985–6 to 250,000 in 1986–7. This involved a shift, condemned by organizations such as NATFHE as a deterioration in quality, from full- to part-time training opportunities. The MSC launched a confusing plethora of initiatives under the aegis of the two programmes which are now only of arcane interest, but they included Training for Enterprise (TFE), Training for the CP, Wider Opportunities for Women (WOW) and the Small Business Programmes. It is a testimony to the ineffectiveness of this total provision, fragmented into a diversity of different schemes, that a later Secretary of State was impelled to combine them into one single Employment Training (ET) scheme. Unlike TOPS, the JTS emphasized training for ‘real jobs’ rather than for ‘stock’, as its eligibility criteria demonstrated. The criteria were that trainees had to be unemployed, over 18 and intending to seek work using their newly acquired skills.22 The TFE scheme assisted people seeking opportunities in self-employment, while the WOTP helped the unemployed to retain their employability by improving their work-related skills and preparing them for changing patterns of work. The Open Tech also continued to provide updating by means of open learning methods, with projects run by industrial and commercial companies, FHE colleges, LEAs and ITBs. The DES had also launched its own feeble

100

The politics of the training market

response to the MSC in the Pickup scheme, only to discover that in order to achieve proper funding it had to work co-operatively with the MSC, which it did in setting up a number of local collaborative projects to elicit the training needs of particular companies.23 The Community Programme (CP) was launched in October 1982, in the tradition begun by JCP. Theoretically, it was a locally designed workexperience scheme, but the ground rules were set nationally. The aim was to provide the long-term unemployed with a year’s work of community benefit, which would not otherwise have been undertaken, and to pay the full rate for the job.24 While CP was not a training scheme, participants could utilize the training elements in the WOTP. Most CP places were in the voluntary sector, but by 1985 it became apparent that the MSC wished to increase the number of places made available for the private sector, and so it set aside £10m. to encourage this outcome. While not a ‘pure’ training programme, CP was an interesting case of policy subversion. By 1987 it became clear that the government was re-evaluating ATS. The growth in the world economy between 1982 and 1987, and a preelection credit boom, were sufficient to encourage the government to lessen its cosmetic approach to unemployment and to focus on adult training. In the area of high-level training it wished to ensure that employers themselves assumed the financial responsibilities, and for the mass of long-term unemployed it sought a greater ‘throughput’ of private-sector-orientated trainees. The Secretary of State also wished to simplify adult training provision by reducing the complex array of schemes to a single one. It is also probable that the DE was affected by the critical report of the National Audit Office (NAO) on the MSC, which undermined its faith in the MSC’s costeffectiveness. The NAO challenged the effectiveness of the MSC’s national awareness campaign on adult training in 1985. Yet the fault lay partly with government rather than the MSC, whose officials advised a gradual launching to ensure that the infrastructure was fully in place. The premature launch of the campaign, therefore, greatly reduced its effectiveness. But the NAO also condemned the MSC’s failure to devise an effective way of measuring the employers’ total training effort, since it was failing to monitor its outcomes against its objectives.25 Yet it was harsh to attack the MSC for failing to rectify decades of neglect in a few years. Part of the solution to the problem of measuring the quantity of employer training, and also of gearing training programmes to real labour-market needs, was the development of sound methods of securing labour-market intelligence. The NAO observed that: [the] MSC had planned to develop by April 1985 a sophisticated computer based intelligence system to provide its area offices with a

After the MSC

101

full picture of available training providers and courses. But the MSC abandoned it in 1985 and replaced it with the simpler Computer Assisted Local Labour Market Information (CALLMI) in 1986. Meanwhile, area offices had to rely on the local demand for skills and training courses available, which was kept mainly in manual records based on local knowledge’.26 Owing to the shortcomings of the MSC’s information base, the NAO was dissatisfied that new skill needs were being identified and addressed. The NAO concluded: that MSC has an urgent need for at least a comprehensive local labour market intelligence system if the objectives of its training programmes are to be achieved without considerable risk of ineffective expenditure . . . MSC have little real information, however, on the skills already held, even by the unemployed.27 Similarly, one of the other concerns of the NAO had already been recognized and was about to be addressed, and this was the absence of an adequate national system of training standards and certification of competence. Three years earlier, however, Training for Jobs had pointed to the establishment, as part of the ATS, of a body with functions similar to the National Council for Vocational Qualifications (NCVQ). The report considered that the Wider Opportunities Training Programme (WOTP) achieved an improvement in placement rates compared to TOPS, but that the evidence about the Job Training Scheme (JTS) was unclear. Yet the NAO report was more concerned about the performance of the local training grants and local consultancy grants, as they revealed the extent of the problem of ‘deadweight’ (i.e. the payment of employers for what they would have done anyway). It also considered that the National Priority Skills Scheme carried ‘deadweight’, although the evidence was unclear. While the NAO recognized that the ATS promised to be more cost-effective than TOPS, about which nobody appeared to offer a positive evaluation, it was sharply critical of the antifree-market character of the relationship between the MSC and its own Skillcentre network. It concluded that: [the MSC’s] undertaking to spend specified annual amounts with its Skills Training Agency (whose courses were currently generally dearer than those at Colleges of Further Education) was an impediment to minimising the cost of ATS courses, although the MSC are making efforts to reduce the differential.28

102

The politics of the training market

Noting that the fees for Skillcentre courses were determined by the MSC’s own Skills Training Agency (STA), the report argued that ‘courses at skillcentres are generally more expensive than those run by CFE’s, reflecting the practical emphasis on STA courses, the usually small class sizes and the overhead costs of running a national network of skillscentres’.29 This led to the recommendation that: it is inevitable that there will be a price to pay for the agreement with STA, which is intended to ensure STA’s survival in the early stages of its redevelopment . . . the future forward planning arrangements between STA and MSC should reflect the desirability of eliminating any excess costs. The NAO was unconvinced by the MSC’s claim that it would be costly to wind down the role of the STAs, and properly so, since the MSC claimed to be a catalyst for free-market policy, and to be cheaper than CFEs. While the report did not single-handedly seal the MSC’s fate, it added to the existing internal problems of the MSC’s attempt to change ATS by developing the New Job Training Scheme (NJTS). The NJTS was opposed by the majority of the Commission, which underlined the anomaly of the residues of lingering tripartism. Confronted with the charge that it had wasted the years from 1983 to 1987 the Conservative leadership felt impelled to show that it remained ideologically vigorous in the programme which it offered the electorate in the 1987 Election. Formally, it was in education rather than training policy that the Party’s ‘new right’ radicalism was apparent, but there were signs in the manifesto that changes in training policy were imminent. The eligibility for a CP place, for example, was to be made more difficult by requiring participants to experience a year’s unemployment, and there was a reference to a new training programme with a guaranteed place for 18- to 25-year-old unemployed adults, and a stated aim of offering places to all the under 50s. The concern with the 18- to 25-year-old age group had been developing since 1984, and was one of the questions pursued by the House of Commons Employment Committee. Initially the MSC informed the committee that the problem would be addressed by the improvement of the CP for its long-term unemployed clientele: This group in particular would be major beneficiaries from the Commission’s proposal which the Government is considering, to link basic training and work preparation with the Community Programme so as to help CP clients become more generally employable.30

After the MSC

103

Yet the Committee chairman questioned whether with three million unemployed it was appropriate for the MSC to lean so heavily upon the CP, since it had a throughput of a mere 200,000 a year. Clearly some rethinking was necessary if the government was to appear active on behalf of the adult unemployed.31 The committee formally recommended that the expansion of the scheme was necessary because of ‘the serious imbalance between the number of places available and the number of long-term unemployed’.32 Two years later there was still concern that adult training was neglected. David Owen, for example, considered that the solution lay in the CP’s expansion.33 The House of Commons Select Committee agreed that more should be done to address adult training needs and suggested improved funding: We were concerned to learn that adult training is not proceeding as fast as the training of young people. It is depressing that mass unemployment and skill shortages exist side by side. The MSC witnesses told us that ‘we feel we have been more successful with young people than with adults. Perhaps our interests have been overly skewed towards young people to the detriment of adult training’. Whereas the budget for youth training was between £925m. and £1.1b. for 400,000 young people, the training requirements of about half that number of adults were expected to be met with a sum of £260m., or a quarter of that amount. They admitted to being strapped for cash and said that to fulfil properly their present commitments they would need a minimum of another £20–25m. a year.34 This neglect of adult training has long been matched by similar neglect in the education system, despite pious comments by policy-makers about continuing education. The MSC’s activities were restrained by Treasury financial curbs. While other comparable states engaged in counter-cyclical expenditure to produce training for stock, so as to avoid skills bottlenecks with the increase of economic activity, the British government considered that restraining public expenditure was the chief index of sound economic management. The Treasury certainly took the view that the throughput of adult students in training schemes should be doubled without any increase in public funding. Thus encouraged, the MSC struggled to increase the number of adult students from 110,000 trainees in 1983 to 250,000 in 1986–7 at the same cost of £270m.35 Yet the pressure for action was intensifying, with successive reports in the mid 1980s emphasising the extent of the problem and blaming management, unions, government and MSC alike. Despite the tendency of annual reports of both the Scottish and the English and Welsh Commissions

104

The politics of the training market

to devote less attention to adult than to youth training, the House of Commons Employment Committee remained greatly concerned and argued for the reintroduction of a levy/grant system. The government’s response to these pressures in the pre-election period was the launch of an initiative to guarantee all 17-year-olds a place on YTS, to expand the Enterprise Allowance Scheme, to introduce the six-monthly Restart interview, to expand the New Job Training Scheme (NJTS) to cover the entire country, and to ensure that the training opportunities would be available for 250,000 people a year. In fact, the NJTS was a spectacular illustration of policy failure. Its problems were only partly those of presentation. This was partly because NJTS was too closely linked to the Restart interviews and the massaging of unemployment figures for electoral purposes, but the main difficulty was that NJTS decoupled adult training programmes from the ‘rate for the job’ agreements which had prevailed under the CP, and only offered unemployment benefit. The CP had also provided training/work-experience. The Commission expressed its strong opposition to the scheme, and correctly predicted that it would fail. By the end of 1987 Norman Fowler admitted that the scheme was ‘slow to take off’, the drop-out rate was running at 40 per cent and placement rates were disappointing.36 The NJTS was promoted by publications aimed at employers willing to become trainers and stressed the focus upon the under-25s, the scheme’s vocationalism, the employer’s right to veto particular trainees, the low cost of under £8 a day for training, the lack of a wage and the exemption of employers from PAYE and National Insurance obligations. The publicity materials for potential trainees linked NJTS to Restart and held out favourable employment prospects. It stressed that trainees would begin with a week of personal assessment.37 Some of the critics of the NJTS wrongly claimed that it was indistinguishable from American Workfare. The judgement is not meaningful as there are many types of Workfare. There were also some substantial differences between the two schemes. The NJTS was no more compulsory than its predecessors, as the established regulations governing the receipt of benefit since the Second World War had included the requirement that all recipients must be available for work. It was the close link between the NJTS and Restart, the rapidity of its introduction, and the loss of monetary wages which caused fierce opposition. Yet the NJTS failed despite the blandishments of Jobcentres and of publicity material. The case is salutary for all policymakers. Even a determined and ideologically motivated government cannot succeed in implementing a policy if it is rejected by those who must implement it and if the client groups at whom it is aimed refuse to respond. The MSC was enduring policy strain by 1987, and that increased its likelihood of failure.38 While it could implement policy more rapidly than LEAs, this had not enabled it to overcome all the problems inherent in top-down policy

After the MSC

105

implementation. The problem was intensified by a lack of clarity about the government’s objectives, which sought both to discipline benefits and to promote adult training, while at the same time cutting costs. The experience undermind the MSC’s credibility with government as an instrument of policy-making and implementation, although Norman Fowler was willing to persevere with the Training Commission (TC). His aim was to design a successor scheme to NJTS that had a higher chance of being acceptable to the trade unions, which had accepted all the schemes which preceded NJTS. Employment Training (ET) was very much his personal creation. EMPLOYMENT TRAINING (ET) The process of designing ET began with Fowler’s request to the MSC in November 1987 for an initiative for the long-term adult unemployed which would combine all existing adult training programmes into a single unified scheme. In the White Paper Training for Employment, the government accepted the gist of the MSC’s proposals. These included the idea that on entering ET the trainees should be referred to an approved training agency (ATA) for appraisal and counselling, which would lead to the development of a personal action plan outlining the particular programme of training that the trainee should pursue. It was intended that ET should provide trainees with a credit towards a vocational qualification, together with a record of achievement.39 The resemblance to later models of YTS is apparent with the fashionable panoply of training agents and managing agents, and the emphasis upon profiling and records of achievement. This represented one of ET’s shortcomings. Adults are not identical to young people and have concerns about dignity which the design of ET may not have fully considered. Carol Lupton has written of the large number of potentially contradictory objectives underpinning the programme which was to become ET. She stresses the commitment to provide beneficial training for the long-term unemployed in the national interest, but adds that the political context suggests the presence of such other important objectives as remotivating those who have lost touch with the job market and increasing sanctions against claimants who are not genuinely regarded as unemployed.40 Yet she ignores the simple rational justification that a survey of existing adult training providers revealed a great degree of duplication owing to the multiplicity of schemes. While the TC’s review detected heterogeneous needs among adults, they were not so diverse as to justify thirty-seven different schemes. The TC’s review also revealed that the economic background had altered since the CP’s inception, and with economic growth and falling unemployment the CP’s resources could valuably be diverted to train skilled

106

The politics of the training market

workers for the productive economy. Also, as the number of young people fell, the flexible training which they had received (which stressed personal transferable skills) could be used to good effect with the older unemployed. The review suggested that a unified scheme could still address a diversity of training needs, while also offering a single set of eligibility rules. While recognizing that the NJTS had failed, with less than a half of the 230,000 places actually taken up and with managing agents suffering cash-flow problems, the scheme had merits which the TC wished to keep in its new programme.41 In short, the need at the end of 1987 was for a flexible training programme which could offer both generic work skills and occupationally specific competences in the same programme. This is an appropriate caution to critics who judge government policies as if the economic and labourmarket background was static. Lupton’s interpretation that the Thatcher government was motivated solely by a desire to increase central control to promote a Workfare philosophy must be challenged. She exaggerates the corporatist character of the MSC’s early years – imagining that, as Cawson defined it, ‘a significant degree of power has accrued to functional groups in society to which the state has to accommodate itself’.42 It has already been argued that the diverse American Workfare schemes bore little relationship to the British situation. The successful proselytization work of the MSC, taken together with its innovatively radical educational methods and basic economic realities, had softened the adult educators’ perceptions of the MSC. The Training for Employment White Paper was welcomed for its unveiling of a training scheme for adults which placed guidance in a central role.43 Adult Education also accepted ET propaganda fully in praising its client-centred style which placed the individual adult at the centre of the process, and the greater amount of training which it contained compared to CP. It is true that the journal referred to the possibility that ET’s implementation would not achieve the quality of the theoretical conception, as training agents were paid on the basis of numbers placed which was: bound to distort the guidance process. The temptation to press individuals into unsuitable opportunities is bound to be strong, especially in a scheme which aims to deal with 600,000 people a year. Where will the staff come from? Is there a pool of people with the skills to do the job?44 Yet the change in attitude to the MSC was apparent: Once again the MSC has seized a real problem and proposed a radical new solution to it . . . . MSC starts from a different assumption – that nothing really changes unless shaken vigorously and that even if things

After the MSC

107

go wrong at first they can subsequently be put right.45 Yet the cri de coeur of a weakly consulted interest rather than an integral member of a policy community became evident in Adult Education’s plea that the Commission should engage in partnership with ‘those who really know about education for adults’.46 The government’s claim that there was unanimous consensus behind ET on the part of the Commission is supported by a 1988 document Towards a New Adult Training Programme. This report was concerned that the longterm adult unemployed had been neglected, and sought to appeal to a group which, while rejecting ‘schemes’, desired to return to work but were sceptical about statistics which demonstrated the efficacy of previous initiatives.47 The Commission was concerned to assist a group in danger of remaining disadvantaged for the rest of its life.48 ET was to be closely linked to Restart, although there were to be referral agencies other than Jobcentres, including the Careers Service, the National Association for the Care and Resettlement of Offenders (NACRO) the probation service, informal contacts and advertising. Advertising was particularly cost-effective for the government. It recruited trainees directly, especially the advertisement that was about ‘square pegs in round holes’, but it also served to interest employers to participate in the scheme. The advertisements also assisted the government electorally by suggesting to more prosperous voters that government was providing training opportunities of high quality to the long-term unemployed. After referral, the first stage of ET was consultation with training agents whose function was to assess and counsel trainees and to develop personal action plans. This was different from YTS practice which suggests the readiness of the MSC to learn from its own experience. Under YTS, managing agents were not independent of the Approved Training Organizations who implemented YTS training plans, and so had a vested interest in pushing young people in specific directions, given the financial recompense on the basis of places filled. ET’s training agents were independent and better advocates for trainee interests. ET also learnt from NJTS short-comings. The problem with NJTS was that referrals resulted from a mere half-hour interview and so the drop-out rate had been high. The second stage in ET concerned the role of the training manager. The TC had hoped that consortia of businessmen would combine to become training agents, but in reality many other organizations, such as educational institutions, were also accepted. Once trainees were referred to their training manager, they received practical training, employer-based projects and jobsearch assistance. While ET was much more orientated towards the private sector than the CP had been, and so many CP-supported voluntary-sector

108

The politics of the training market

community projects were jeopardized, there was a wide range of training managers drawn from both the public and private sector. In any event, the TC maintained that the decline of community projects partly resulted from the political gestures of certain bodies, such as Liverpool City Council which removed themselves from the scheme in protest at the ending of wages in favour of a benefit-plus arrangement. Yet Norman Fowler had also stated that the ultimate policy was for private employers to dominate the scheme. The introduction to training was to be gradual, where that was appropriate for particular trainees, so as to produce ‘a gently sloping ramp’. The third and final stage of ET was that of ‘Exit’, which involved the three possible outlets of jobs, self-employment, Jobsearch (including membership of a Jobclub), voluntary work, and further education. While the main purpose of the exercise was to place people directly into remunerative employment, perhaps in the training manager’s own firm, extended ET training was also a possibility to fulfil the trainee’s action plan. The programme delivery of ET involved the participation of 169 training agents (TAs) and 1,100 training managers (TMs). Research revealed the different position of adults compared to youth trainees in terms of prior qualifications. It was clear that the members of the 25- to 49-year-old age group were even more diverse than 16-year-olds. While some of the longterm unemployed in that age group possessed qualifications, 63 per cent of those who had been without work for over two years had no qualifications compared to 26 per cent of unemployed youths. ET was different from the YTS in other important, market-sensitive, respects. Research revealed a negative response to the words ‘scheme’ and ‘jobs’, so the Adult Training Scheme (ATS) was transformed into Employment Training (ET), although a Moorfoot joke was that there were copyright problems about ET with Columbia pictures! The titles of training agent (TA) and training manager (TM) were deliberately adopted in order to differentiate ET from YTS with its managing agents (MAs). There was also an appropriate desire to be seen to be differentiating the brokerage and training functions. The funding and contracting system within ET was simpler than earlier schemes, assisted by the involvement of fewer providers. Before, there had been elaborate contracting arrangments with a number of actors – including a diversity of employers, voluntary agencies, local authorities, colleges of further education, Skillcentres and others – whereas for ET the area manpower boards simply contracted with a small number of training agents who in turn negotiated for trainees with training managers. ET enjoyed greater independence on a dayto-day basis, therefore, although training managers were required to pay closer attention to local labour-market needs than had been the case with TOPS. Training agents were provided with information by the local labourmarket team in each area office. ET also had fewer eligibility rules and was

After the MSC

109

able to assist people who had not signed on at employment offices such as ex-offenders, labour-market returners and the disabled.49 TC officials recognized within a few months of the scheme’s launch in November 1988 that all was not proceeding well, but attributed the problem to a bottleneck at the training-manager stage, so that the large number of people referred were not always able to implement an action plan. Yet the government was partly to blame, since (as officials confirmed) there was political pressure to get the scheme under way so that the Conservative Party’s election commitments could be delivered during the course of the parliament. An ‘away weekend’ in February 1988, involving the Secretary of State, determined that there should be a November 1988 launch. It was also political pressure which ensured that ET should be delivered without any further investment in resources. Clearly neither TC officials nor the commissioners could claim to be setting up a high-quality, high cost programme, since a scheme which assisted fewer unemployed people at a higher unit cost would not have been acceptable to the government. Since the DE could only obtain £1.4b. per annum from the Treasury, the Secretary of State proposed a sixmonth scheme involving 300,000 trainees at any one time, thus absorbing 600,000 over a one-year period. The TC was prepared to accept this brief, however, as it received bids from potential training managers which could have provided 700,000 places per annum. These bids did not always offer the required quality and skills, however, and were often wrongly located geographically. This oversubscription encouraged the TC in the judgement that it could reject certain applications on quality grounds. In the background was the fascinating intra-labour-movement controversy over collaboration with ET, and it appears that some employers decided not to involve themselves for fear of union militancy. TC officials acknowledged their ambivalence towards colleges of further education, but they did not wish to be over-reliant upon them. Yet the same officials recognized the CFE’s efficacy with the disadvantaged groups among the long-term unemployed: for example, those with literacy and numeracy problems or ESL needs. TC officials naturally sought to portray ET in a favourable light, both in its own terms and in comparison with other adult training schemes. They stressed the quality design features of ET. To secure approved status, both training managers and training agents had to meet criteria. Training agents had to show that they could produce personal action plans for trainees which would aim at the achievement of vocational qualifications; while training managers had to demonstrate that they trained or intended to train their trainers, that programme reviews involved trainee responses, that trainees obtained a file demonstrating their progress and qualifications to show prospective employers, and that there were effective health, safety and equalopportunities provisions. The evidence provided by the TC’s response to

110

The politics of the training market

applications for approved status is ambiguous. While fewer than 5 per cent of applications were rejected, nearly as many were deferred as were approved. TC officials maintained that ET was to be seen as respectable as the twoyear YTS. ET was also to be subject, as YTS had also been, to the inspections of the Training Standards Advisory Service (TSAS). This was a TC organization but it was outside the line management of both YTS and ET, and it reported directly to the Commission. As well as inspecting the work of both TAs and MAs, it produced thematic reports on specific issues – such as ESL teaching and programme-review arrangements. TSAS also ran its own training modules for ET trainers at accredited training centres. There is little need to discuss detailed questions of funding, but at the outset TAs were funded £20 (soon increased to £30) per referred trainee, £20 for each action plan and £15 for each successfully referred trainee. MAs received a £15 start-up fee, £17.50 weekly grant, up to £40 (but averaging at £20) supplementary grant and £20 for each completed action plan. Much of the fixed sum of £1.4b. was earmarked for the payment of benefit-plus to trainees, especially as it appeared that the lead over benefit was likely to run at £10 to £11.45 per head. The Treasury had fought for a lower sum. The average ET trainee was reimbursed on average by 17 per cent more than NJTS trainees had been. The funding structure of the CP had been very different, since employers were paid whether or not they filled their places, and the MSC had paid the wages. The greater cost-effectiveness of ET was evident in the statistic that while the CP cost £1,474 per place per annum, ET cost £2,311 per place. TC officials were particularly concerned to demonstrate that the financial recompense for ET was generous in order to rebut trade union claims that it was an exploitative cheap labour initiative. ET offered its participants their benefit plus a £10 minimum lead, up to £11.95 for some, and the average single person received £38 per week, and the average married man received £62.70. Travel costs were also reimbursed over £5 per head, and child care, special clothing and lodgings allowances were considered to be important as they encouraged mobility of labour (which is an important element in promoting economic growth). The only losers were young single people who had received ‘rate for the job’ payments under CP. Such TC propaganda was intended to demonstrate that the opponents among the trade unions and local authorities were unreasonable. In short, the TC’s claim was that allowances were similar to those received under the old Job Training Scheme which had been accepted by those who now rejected ET; and that the complaint that the CP wage had been lost neglected the fact that ET offered training rather than mere temporary work-experience. The long-term unemployed who emerged from ET were more likely, therefore, to gain – as ET offered foundation training and confidence-building as well as specific vocational skills and qualifications.

After the MSC

111

It may appear curious that ET provoked so much controversy. It was a programme which despite its shortcomings promised to get people quickly into jobs, and the older unemployed sought jobs quickly. It is also the case that with the major industrial restructuring of the 1980s, coupled with the growth of the service sector, a conversion process was needed for the unemployed to work. Yet many of the jobs that were becoming available were often poor, low paid and part-time, thus lending support to dual labourmarket theories. ET was not likely to produce many who were skilled enough to occupy core positions in the labour market. Equally there was a contradiction between the ‘selling’ of ET as a personal programme (with individual adult needs as central) on the one hand, and the process of training for the market on the other. This was manpower planning in disguise, although the planning could be partially concealed by the localism of the labour-market focus. Despite the obvious objections to ET from the labour movement, however, it is proper that publicly funded programmes should have ‘strings attached’. Before the debate within the labour movement during 1988 is analysed, it is important to view the ET initiative from the government/TC perspective. The Treasury was constraining expenditure, there remained many long-term unemployed adults, the TOPS scheme and the CP had failed to solve the training needs of large numbers of long-term unemployed adults, and, having been defeated over NJTS, Norman Fowler invested a good deal of effort in producing a scheme which would remove some of NJTS’s worst features to secure trade union and local authority support. He still hoped for their support up to the moment when the TUC voted to phase out its co-operation with ET. He had some grounds for scepticism about where the trade union movement stood on the issue, since the split within the ranks of the labour movement was reflected on the Commission itself. While the General Secretary of the Transport and General Workers Union (TGWU), Ron Todd, opposed ET and resigned from the Commission early in 1988, the position of the trade union movement as a whole was unclear until the 1988 Congress. At the same time, Fowler made a tactical error (if his main objective was to secure TUC support for ET) by announcing in the autumn of 1987, at the very time when he was removing the Employment Service from the MSC, that he intended to change the balance of representative power on the Commission by increasing the number of employers. This would further intensify the minority status of the union representatives, and weaken the effectiveness of the alliance between the trade-union, local-authority and education representatives. This hardly predisposed the trade union representatives to believe in the Secretary of State’s good faith towards them. That it was an error of judgement rather than the beginnings of a ‘plot’ to close down the TC is suggested by the appointment of Brian Wolfson to

112

The politics of the training market

replace Bryan Nicholson as chairman on a long-term contract. In any event, Fowler was aware that the unions were no longer the force in national political and economic life that they had once been, and that his ET scheme (which accounted for £1.4b. out of a total TC budget little in excess of £3b). was too important to be jeopardized by the unpredictable internecine battles within the labour movement. Fowler also came to the decision that the NTI of 1981 was becoming obsolete, and that the time had come to bury the CP. An emerging consensus between the TC and the DE was that work-experience coupled with training was most likely to increase the placement rates for trainees in subsequent employment. In short, the goals of helping voluntary community projects to flourish and skilling and updating the workforce for future employment prospects should not be confused. ET and the labour movement Much of the political controversy over ET during 1988 is now of limited historical significance. It is intended to rehearse a few of the major arguments of the time, since it reflected a stage in the modernization of the Labour Party, and the outcome marked an important evolution of training policy. The organizations which purported to ‘speak for’ the unemployed were politically defeated, and it was left to the trainees themselves to determine, by their behaviour in terms of using their right of ‘exit’, ET’s effectiveness in practice. NATFHE and the Unemployment Unit responded rapidly to the White Paper Training for Employment. Both recognized the importance of the initiative, since demographic change ensured that it would overtake YTS. Their emphasis was mistakenly upon the issue of compulsion, and so other aspects of the scheme were ignored. While acknowledging that Fowler had proclaimed the scheme’s voluntary character, NATFHE continued to argue that the scheme must be voluntary since ‘coercion and learning are incompatible’. This was a non-issue, but instead of mustering relevant arguments about the scheme as it was actually going to be, critics engaged in irrelevant agonizing: As with previous schemes colleges are faced with a real dilemma – to stand aside and watch as the number of young people drops and the private sector grows, or to become involved in a programme which currently has major flaws in it.50 Two arguments were dominant. First, would the scheme become compulsory or could it retain its voluntary basis? Second, was it better to remain within the scheme to modify it, or to boycott it?

After the MSC

113

The left remained obsessed with the fear of Workfare, since, despite the Secretary of State’s repeated denial of his intention to designate ET as Approved Training under the Social Security Act of 1975, Carol Lupton argued that the connection between ET and the Restart programme suggested that ‘in refusing to accept a place on ET, the unemployed individual may run the risk of raising questions about his/her availability for work’.51 It is reasonable for those in receipt of benefit to be required to look for work or training as was the case in Social Democratic Sweden; but ET was not formally compulsory, and, in any event, it is a training scheme and not enforced labour. Further, as a vigorous opponent of trade union collaboration with ET, Clare Short argued that previous legislation already provided the state with ample grounds for compulsion. Her opposition was to the inadequacy of the training and to the unlikelihood of adequate work being subsequently available for trainees.52 Further, even William Beveridge proposed that: unemployment benefit will continue at the same rate without means test as long as unemployment lasts but will normally be subject to a condition of attendance at a work or training centre after a certain period. The normal period of unconditional unemployment benefit will be six months.53 The TUC council gave formal support to ET in May 1988 after Norman Fowler added the carrot of a £250 bonus for trainees who completed a year’s training. He was also busy leaking the idea that the TC would not be formally launched in the autumn of 1988, and would be replaced by direct departmental control over training policy if the TUC council refused to take part.54 While the trade unions agonized, the Labour Party appeared to take a firmly oppositional position in May 1988, quite contrary to that defined by the Labour Party leader Neil Kinnock at the TUC Conference in September. Clearly, on the second occasion, Kinnock decided to support the position taken by Norman Willis, the TUC General Secretary. In May 1988 the Labour Party’s General Secretary, Larry Whitty, wrote to Labour local authorities asking them not to co-operate unless participants were to be paid the rate for the job, the scheme was voluntary, each scheme was to be given local trade union approval and trainees were given employee status.55 The TUC was less clear-cut, and its dilemma was whether to continue membership of one of the few remaining bodies spawned out of the tripartism of the 1970s. Even the Labour Party was divided. The education secretary of the Labour-controlled Association of Municipal Authorities (AMA), Neil Fletcher, in a letter to Larry Whitty, accused the national party of ‘political posturing’ which would destroy 20,000 jobs and reduce training opportunities for unemployed adults, and he condemned

114

The politics of the training market

Labour’s lack of practical alternatives. It is true that there were grave problems in any position which the Labour Party adopted over the scheme. If, for example, it refused to participate then it would damage the voluntary sector which was in a ‘dependency culture’ with the MSC. If Labour local authorities refused help to voluntary bodies which were linked with the MSC, then it would mean the demise of many such bodies, and the resulting unemployment would be laid at the local authority’s door. Rather than merely boycott ET, the Labour Party would have done better, according to one member, ‘addressing its opposition to the MSC and, as a start, encouraging the TUC to depart from this corporate collusion with objectionable government policies’.56 Alternatively, it should have upheld the MSC for as long as possible, and worked for improvements to ET. It was the TUC council which first decided formally to work with the scheme. It received plenty of advice not to withdraw from apparent ‘discredited corporate collusion’, but to take part in the scheme. Melanie Philips argued for TUC participation in the interest of the long-term unemployed: People at the bottom of the pile, who represent one of the most intractable problems of the welfare state would become victims . . . Meanwhile on the ground, out on the abandoned council estates, the only conceivable route back to employment for the long-term unemployed would be wiped out . . . Clare Short says the TUC should scupper the scheme because then the government will be forced to come up with something better. Really? The chances are that it will come up with something very much worse.57 This was realistic, although, as events demonstrated, the TUC and the Labour Party did not need to co-operate for the scheme to develop, and the MSC itself did not really want too many local-authority and voluntary-sector type placements in the longer term. She was correct to point out, however, that ‘every programme the MSC created engendered the same passionate denunciations as this one; yet . . . all have become a status quo to be defended’.58 Further advice came from other left-wing commentators such as Peter Kellner. He too pointed to the explicit ministerial denials of compulsion, and also argued that the new scheme was more favourable than any of its predecessors, in the important sense that non-participants were not to lose any of their benefits. He also pointed out that the Commission itself decided that ‘at least thirty-seven separate programmes may be identified. The proliferation is confusing to provider and individual alike’.59 At that stage Ron Todd accepted a report from the Commission’s working group outlining the scheme’s characteristics. Kellner concluded that union

After the MSC

115

participation was needed to persuade employers to take part, but that the Treasury would be delighted at saving £500m. a year. Yet the European Commission was less happy about the fact that British training policy was too directly under government control.60 The Guardian sided with those who believed the Labour Party and the TUC had a duty to support the scheme, since its priority was training rather than employment.61 Yet the groundswell of opposition to the scheme from such trade unions as the National Union of General and Municipal Workers (NUGMW), the National Union of Public Employees (NUPE) and the Transport and General Workers Union (TGWU) grew, and in May 1988 Ron Todd withdrew from the Commission. The AMA and the Labour Party, however, were about to follow the TUC’s acceptance of the scheme. This support appeared to be strong enough for the TUC to continue in the Commission’s membership, but Michael Meacher, MP, argued that a scheme which aimed to double the number of participants to 600,000 a year on adult schemes for the same budget as before was necessarily of diminished quality. The opposition of such unions as the National and Local Government Officers (NALGO) and the TGWU threatened the scheme’s viability, however, since NALGO members would be charged with administering most of the places in local authorities, and the TGWU’s influence in the private sector might deter private employers from participating. The dispute continued during the summer of 1988. NATFHE, despite its college membership’s involvement in the scheme’s delivery, maintained its opposition. It was worried over compulsion, the loss of the rate for the job, employee status and trade union monitoring rights. The local power of unions was to be confined to merely advising rather than deciding whether or not particular programmes were acceptable.62 Yet the pleas of some members in a Conference debate to end NATFHE’s associations with the MSC were turned down. In July a sympathetic observer outlined the trade unions’ dilemma: The unions have had to weigh their hostility to Employment Training against the value of continued participation in one of the few remaining forms of tripartism. This is a dwindling asset – the government is not known for heeding union views. What is more, employers are to be given up to six additional members on the Commission. Half a loaf is better than none. But the unions may feel that they already have half a loaf with the existing schemes. The true choice is between quarter of a loaf and none and that makes the decision a lot more difficult.63 By August the TUC’s decision to support ET was in jeopardy. This was because of the likely expulsion of the electricians’ union (EETPU) from the TUC. Some TUC leaders sought compromise. One example was that,

116

The politics of the training market

regardless of the TUC’s formal position, individual unions should be free to participate in the scheme, and that union co-operation generally should only be phased out over a two-year period. The Secretary of State was understandably unimpressed with such characteristically confused outcomes.64 The TUC Congress debate in September 1988 was, therefore, vital both for ET and for the survival of a last bastion of tripartism, the newly formed Training Commission. The Labour leader, Neil Kinnock, considered the debate important enough to intervene. His speech to Conference recognized the scheme’s shortcomings – such as underfunding, the difficulty of providing trainees with employment in many parts of the country and even the poor nature of much of the training provided. But he argued that only TUC involvement could raise the quality of the programme. Anticipating that rejection of the scheme might offer government the pretext to end trade union representation on the Commission, he informed Conference that because the government wanted to exclude unions from training policy-making, he wanted them to remain involved in the process. Despite intense lobbying by such union leaders as John Edmonds, however, the TUC Conference adopted one of its characteristically Janus-faced positions, by voting to phase out of ET over two years. Norman Fowler’s immediate reaction was to abolish the TC and to erode still further the tripartite co-operation in policy-making. This ended twentyfour years of active state intervention in training, and a return to a voluntary market. Fowler’s reason was the TUC’s lack of commitment to a scheme which was about to replace YTS as the largest single scheme under the TC’s aegis. He also announced that there would be a new White Paper to prescribe training arrangements for the future, and the TC was to be stripped of the Commission and to become a Training Agency (TA). It appears that the warnings of Neil Kinnock and John Edmonds had been justified and that the TUC had voted to remove itself from the training-policy network. Certainly, the TUC made a tactical error and undertook the Secretary of State’s work for him. Yet it is also true, as James Stephenson argues, that the TUC was only being offered ‘a quarter of a loaf’, and was already having its representation on the Commission reduced relative to that of the employers. A further diminution of authority was its reduction of powers in the delivery of local schemes. There is also evidence that the government had already decided to jettison tripartism and to adopt a market approach, and newspapers had speculated that Fowler would remove the three existing trade union commissioners, and replace them without TUC endorsement by the expelled electricians’ leader, Eric Hammond, and the engineers’ leader, Bill Jordan.65 The last three TUC commissioners were: Roy Grantham, leader of the clerical workers’ union APEX; Garfield Davies, leader of the shopworkers’ union USDAW; and Roy Jackson, assistant general secretary of the TUC.

After the MSC

117

There is some possibility, however, that Fowler was so disappointed by the TUC’s negative reaction to the ET scheme, over which he felt a keen sense of paternity, that the abolition of the Commission was an immediate and piqued response, which according to one participant revealed his human vulnerability. It appears more likely, however, that the Prime Minister had already determined to cut the knot, since in a speech in the week before the TUC Congress she welcomed the plan of the chairman of the Scottish CBI to transfer the responsibility for the training of the unemployed to local employer networks. In short, the TUC’s vote provided the pretext rather than the cause for the TC’s abolition. It is unwise entirely to dismiss the views of other commentators, however, who suggest that the government would have retained an employer-dominated TC alongside the new local arrangements which it introduced in its December 1988 White Paper, so the unions would have retained a role in a body which might have fulfilled the functions later carried out by the National Training task force. The controversy is complex and it is now impossible to reconstruct the beliefs held by the main actors in the drama. The government thus translated the TC into the Training Agency, a body which lacked any formal external influences upon it. This was a more decisive step than the formal abandonment of the TA in 1990 and the transfer of its remaining functions to a unit within the DE itself, as it removed the Commission’s role and eroded the space between the government and the locus at which training policy was actually made. The main concern now was to ensure the success of ET, and to write a White Paper to launch a new training policy framework. The DE was now also ready to confront many of those who wished to withdraw co-operation from ET, and, while many individual unions and the formal representative channel for Labour local authorities, (the AMA) were still loosely a part of a weak policy network, those outside it were to be confronted. Thus the government sought a legal ban upon Liverpool City Council to prevent it from penalizing organizations which participated in the ET scheme. Yet the policy of outright noncooperation was confined to councils in Greater Manchester, Merseyside and a few London boroughs. It was evident, however, that the DE still had much to do to persuade private employers, who varied in the enthusiasm with which they engaged with ET. TC officials cliamed high levels of success for many months after the introduction of ET while acknowledging certain ‘teething problems’. It was not long before press reports began to appear asserting that the unemployed were ‘shunning’ ET. In some parts of the country, targets had been reduced by between 30 and 50 per cent, because of poor demand for places. There was a nationwide reduction of 12 per cent while some firms in London experienced far larger cuts. Overall, six months after the scheme was launched,

118

The politics of the training market

the take-up was 151,000 which was well short of being on target for 600,000 per annum.66 The DE’s response was to alter the scheme’s eligibility rules to cater for those who had been unemployed for less than six months. Yet ET’s critics failed to recognize that the low take-up rate reflected a tight labour-market in some parts of the country rather than a conscious resistance by the unemployed. In one part of the East Midlands, for example, in December 1988, ET vacancies were more numerous than the numbers of unemployed. 67 Another ET training manager received a contract for 150 employer-based, 150 full-time-training and 100 projectbased trainees, yet recruited only 220 trainees from Jobcentres. Ironically, the tightness of the labour market did not ensure high standards. The firm in question was a medium-sized private organization which had been involved in schemes as far back as YOPS. It claimed that 99 per cent of its trainees gained a qualification, got a job or pursued further training. However, it considered TA monitoring to be minimal, since it was visited only once, and, instead of inspecting the premises and talking to trainees, an official merely checked the paperwork on the performance of action plans, and required a statement on equal opportunities. This was necessary, but it failed to challenge practice, since most trainees were following gender-stereotypical programmes in that organization.68 It is extremely difficult to offer objective evaluations of ET as it was bedevilled with ‘interested’ analyses. Labour’s employment spokesperson claims that the DE demanded ‘good news’ stories about ET from local area offices. Yet if this was the case, it failed to prevent negative press accounts. The Guardian carried a story in which a whole series of bad experiences was recounted, which led to the conclusion that the scheme was in chaos. Ultimately, it was the emergence of the TECs, and their capacity to adapt ET to local labour-market conditions, which offered the prospect of rescuing the declining remnants of the scheme. Yet those remnants were very different in philosophy from the original intentions of the ET initiative. The change in emphasis reflects not only the importance of the implementation process in policy-making, since the local TECs and the long-term unemployed were clearly signalling disaffection with the scheme, but also a change in government attitude. The failure of the ET scheme to attract the full number of hoped-for trainees from the ranks of the unemployed, plus the reluctance of employers to participate, soon became apparent. In the autumn budget statement of November 1990 the Secretary of State made it clear that ET was running substantially below capacity, with about 180,000 people taking part, compared to the original estimate of 300,000 at a time.69 An unpublished government study also revealed that additional to the low take-up rates, employers were unenthusiastic about giving on-the-job training to participants, and that

After the MSC

119

employment or full-time training was achieved by only half who completed the programme.70 Yet the failure of ET coincided with other causes to encourage government to change its course. First, the government wished to cut the budget allocation to TECs while retaining the loyalty of the senior chief executives and managing directors. This involved a trade-off. The DE was willing to see TECs allowed far greater flexibility over the expenditure of their budget in return for their acquiescence in ET programme reductions. The ET bore the brunt here, since the DE was ready to allow a loss of up to 85,000 places, or up to 40 per cent of capacity, in the 1991–2 financial year. This followed a cut of more than a third, amounting to £300m. a year in real terms, in the 1990 autumn budget statement. The consequence was the loss of 215,000 ET places each year, including 39,000 people with special needs.71 Second, the DE appeared to accept the TEC philosophy that ET was of limited value in the form in which it was originally conceived in 1988. For that reason, it was no major concession for Michael Howard to allow ET to be ‘reduced in scale and reshaped’ to permit TECs more freedom to deliver it. In particular, they were to be permitted to reduce places for the longer-term unemployed.72 So ET was no longer to be focused on the problem of long-term structural unemployment or, following Norman Fowler’s ‘sales pitch’, on the goal of ‘training the workers without jobs to do the jobs without workers’. Under a new set of rules, the TECs were to be allowed to tailor the ET scheme to local circumstances, and the government subscribed to the TEC view that the best route back to employment for the long-term unemployed was through the employment services: for example, the Jobclubs and the Restart programme.73 Clearly, the versions of ET which develop around the country in the 1990s will be very different in character from the original model. It is remarkable that a scheme launched to tackle the endemic needs of the longterm unemployed through personalized training programmes, should evolve into a programme to help either the short-term jobless, or even those actually in employment. Clearly, the notion of the ‘skills ladder’, in which those in employment are assisted to climb up the jobs tree in their firm, thus releasing opportunities for the unskilled among the long-term unemployed, was a philosophy which the government was prepared to share with the TECs. The problem with this approach was identified by Tony Blair, Labour’s employment spokesman. While local autonomy over the delivery of ET was useful in retaining the enthusiasm among TEC chiefs at a time when funds were under threat, Blair argued that cuts would have a devastating effect on the opportunities for the growing numbers of unemployed at a time of deepening recession. It is certainly an irony that ET’s critics in the ranks of the TUC were condemned for their reluctance to participate on the grounds that the scheme was the only way in which the long-term unemployed could

120

The politics of the training market

be spared the indignity of unsuitability for the labour-market. Government policy was indeed changing under the John Major government, and in an apparently less compassionate direction. The developments in this area after 1991 are discussed in the next chapter. WORK-RELATED NON-ADVANCED FURTHER EDUCATION (NAFE) What little remained of the energy of the training world after the controversy over ET was consumed in the brief period covered in this chapter with workrelated NAFE and the production of local development plans. The FEU, which had been so influential over the emerging educational methodologies of the 1980s, offered advice on the subject as did the MSC itself. The continuing need to develop training opportunities was highlighted by the MSC’s labour-market report for September 1987, which showed that, leaving out people on government schemes, the percentage receiving job-related training was as low as 9.9 per cent of the workforce.74 Furthermore, of the 2.5m. people receiving job-related training, as few as 15 per cent combined off- with on-the-job training. The need for local authorities to develop plans was the result of the compromise reached over Training for Jobs. The MSC furnished LEAs with labour-market planning guidance in documentary form, which focused on national trends while also pointing to significant regional and local developments that were expected to influence the demand for skilled labour. The MSC also urged LEAs to move from existing historical cost systems to ones which more clearly linked resources to the capital, staffing and financial implications of their new development plans.75 The main thrust of the FEU’s document was concerned with quality, which was defined as being both ‘elusive and difficult’. It stressed that NAFE should be connected to local and national labour-market needs. This required colleges to ‘market their services as collaborators in the training process itself, helping to devise and deliver cost-effective learning, properly integrated with company operations and tailored to the needs of those concerned’.76 Yet clinging to its more liberal traditions, in a way that was already sounding dated, it added that LEAs should balance work-related NAFE against other broader responsibilities, and it also stressed that student and broad-based objectives should counter employer and job-specific considerations. The same document warned against an unrestricted ‘pick and mix’ approach to modularization, and emphasized that ‘life skills’ were as necessary as mere occupational competences. Similarly, while endorsing the need for open learning, it argued that learners also require the support and guidance of peers and tutors. It was also necessary for colleges to offer enough counselling facilities, as well as

After the MSC

121

staff development for support staff, to ensure that customer needs were considered. Yet this type of advice was already becoming pious in the sense that, as Derek Betts of NATFHE expressed it: with the devolution of powers to colleges, schools ‘opting out’, a new HE sector and a changed status for the Training Commission [old MSC], it is difficult to imagine what kind of ‘strategic planning’ will be possible.77 It certainly did not appear to be a discontinuity in policy when the 1988 White Paper Employment for the 1990s largely thrust local government out of training policy. The creation of employer-dominated TECs assisted by high-quality Civil Servants would effectively remove any remaining strategic responsibilities which the LEAs had to promote vocational education and training in their areas. The White Papers of 1991, and the setting up of a national planning body for the funding of FE, underlined it. The period from 1987–90 is mainly significant, however, for the demise of the entire quango. This is a significant milestone, which demonstrates that the tendency towards a simple incrementalism in policy-making was undermined by the Thatcher government. It was a surprising event, because policy theorists comment that there is a natural reluctance to kill institutions owing to the pathology of human beings about death. It is ironic that the Thatcher government’s attitude came full circle. From 1979 to 1981 the quango faced hostility, but after 1981 it became a favoured institution for all the reasons that have been described. Now it was out of favour in line with the Conservative manifesto of 1987, which proposed a new manpower authority with a particular organization responsible for training. The clear symptoms were revealed in the earlier discussion on ET: for example, the idea of increasing employer representation on the Commission, the delay in finding a successor for Bryan Nicholson as chairman, and then the appointment of a temporary incumbent. There was also the DE’s change to the area manpower boards, in which chairmen appointed by the Secretary of State would select the employers to serve on the board, which were now expected to comprise a majority. The signs were clear, and, as The Times Educational Supplement mentioned, the training parternship was under threat and YTS was described as nothing more than a transient ‘quick and impoverished fix for mass unemployment’.78 No longer could the bodies which followed the MSC have the aspiration of transforming Britain’s industrial economy by a comprehensive strategy of manpower planning embracing both employment and training. It is a further irony that the Training Agency, which came into being in September 1988 shortly after the infamous TUC congress effectively

122

The politics of the training market

renounced collaboration with ET, was similar in character to the Training Services Agency set up in 1973. The TA had a short life-span which was marred by the partial failure of the ET scheme, and so the TECs were born. The problem was that the optimism which encouraged the Secretary of State to transfer responsibility for training to employers in the TECs was born out of a passing wave of interest in training by employers, who were becoming fearful of a shortage of skilled labour. Ainley and Corney are broadly correct to conclude that the quango had ‘created many enemies, stamped on many toes, but a powerful Civil Service headed by a tripartite commission looked a better prospect than the one that had replaced it’.79 The MSC had its left-wing critics, who rejected the mainstream analysis which has just been presented and argued that the MSC had a more conspiratorial function – that of the control and surveillance of labour. It is certainly true that the MSC and government propaganda was also strikingly presented for a number of years in the mid-1980s, much of it supported by progressive educators within the DES’s own Further Education Unit (FEU). The less flattering interpretation that the MSC performed the functions of capital, and that it did so by techno-corporatist methods, has been argued by C. Lamb.80 Lamb argues that national training policy covers both the programming and regulation of trainees; and he suggests that the process is aimed at producing attitudes and behaviour appropriate to the needs of capital.81 This function, he argues, is concealed by the development of a techno-corporatist style of management, embodied in the then Quality Branch. Lamb observes that the MSC depended upon tripartite machinery to legitimate its policies, by routing them through tripartite structures.82 The experts consulted were those who were regarded as ‘credible’ by the MSC itself, and to be credible they were no threat to the interests of capital or the state. This view is tautologically valid to those who are operating within a Marxist analysis. The empirical interpretation proposed here, however, recognizes the advances achieved by the MSC, and also observes the subsequent regret at the MSC’s demise by many who were its erstwhile left-wing opponents. Many of them are now profoundly sceptical about the fashion for the market in training which has replaced the operations of the MSC. THE RESEARCH UNIT The MSC maintained its research activities in the eras of the TC and the TA, although in a modified form. The research directorate retains overall control, but the work is now undertaken by the Labour Market Information Board (LMIB). The regions continue to collect information from the local area manpower boards, but there is now support from the Local Labour Market Research Unit (LLMRU) at the Sheffield headquarters. It evaluates the

After the MSC

123

effectiveness of the Computer Assisted Local Labour Market Intelligence (CALLMI) collection system which now assists area offices to understand local labour-market needs. The potentialities of information technology (IT) are exploited, therefore, to provide a database to aggregate employment vacancies, both by sector and locality. The availability of labour-market intelligence continues to be an important source of information for employers, although many others are also attainable. Since the DE removed the responsibility for employment from the TA, however, it is mainly a departmental, and, since 1990, an agency responsibility. Yet such information is also valuable in the training field, particularly since the TOPS conception of training for stock was replaced by adult training programmes (the last example of which was ET) which orientates training explicitly to anticipated local vacancies. It is evident that anticipated labour-market changes are a less reliable indicator than precise information about existing vacancies, but planning for training necessarily depends upon future projections. Employer expectations are the main source for judgements on future labour and training needs in a local area, and the CBI and other bodies also undertake their own analyses. All these surveys depend upon the accuracy of employer assessments, whereas employers are both prone to fallibility and to shortterm judgements, and they also lack the economic data to guide their perceptions. In short, for all that the MSC attempts to plan for future labour and training needs, it must necessarily fulfil a partly reactive role in responding to requirements that are frequently unforeseeable. It is necessary to define the term ‘labour-market’. It is the mechanism, principally institutional, through which employers as buyers of labour, and workers as sellers, affect the deployment and utilization of manpower. It is not the people themselves who are bought and sold, but their labour services, which are a factor, like machinery and materials, in the production process.83 It is also necessary to distinguish ‘external’ from ‘internal’ labour-markets. The external variety comprises the interactions of many employers drawing on the national and local labour force; whereas the internal labour-market concerns the interaction of forces within the firm itself. The desire of the TC, the TA, and now the DE to promote economically useful training necessarily straddles these interdependent areas. The DE has acquired an increasingly active role with reference to the structure of the entire labour market since 1979, however, as it sought to promote a more flexible, less union-regulated, and more appropriately trained workforce. This has involved it in encouraging both its own technical approach to the labour market, and the economically liberal theories of Thatcherite Conservatism. In expanding the scope for its own research unit, the TC and TA were able both to provide a countervailing source of expertise to that propounded

124

The politics of the training market

by the ‘expert’ commissioners, and more generally to stifle their dissent against various schemes and initiatives by producing hard evidence to counter commissioner prejudices. THE BIRTH OF TRAINING CREDITS The CBI deserves the main credit for the emergence of ideas about a market in training. At its 1989 conference there was an enthusiastic response to the CBI’s task force document, Towards a Skills Revolution. The members who produced the ideas which proved so influential on government policy were: Sir Bryan Nicholson (chairman); Geoffrey Armstrong of Chartered plc; Sir Christopher Ball, Kellogg Research Fellow of Oxford University; Brandon Gough of Coopers & Lybrand; Peter Hobbs of Wellcome plc; Thomas O’Connor of Elta Plastics; Tony Palmer of Taylor Woodrow plc; John Pardoe of Sight and Sound Education Ltd; Sir Leonard Peach, IBM UK Ltd; John Banham of the CBI; Jeffrey Bartlett of British Paper and Board Industry; Michael Belt of British Telecom; Peter Samuel of Kingfisher plc; Geoffrey Shingles of Digital Equipment Ltd; Trevor Thomas of Unilever Holdings; Rhiannon Chapman of the International Stock Exchange; Tony Close of Trusthouse Forte; Peter Galsworthy of FI Group; Sir Peter Thompson of National Freight Consortium; Michael Woodhouse of Courtaulds plc; and Ivan Yates of British Aerospace plc. The task force was set up as a result of the threat posed by the skills gap which was discussed at the 1988 national conference. The central proposal was that of the idea of the careership which would provide a clear framework for all young people’s learning from the age of 14 to 18. This implied that there was no case for employment which did not give opportunities to gain nationally recognized qualifications.84 The report made the concept of the training market clear: Yet skill needs can only be met by the creation of effective training markets in which the customers – individuals and their employers – exercise more influence over education and training provision. Employers must be persuaded to manage their skill needs like any other business challenge.85 Yet the CBI also recognized that government had a central role to play, in order to offer the nation a coherent vocational education and training policy. The task force elaborated the idea of careerships, as they considered it necessary to place the needs of individuals more highly than those of the providers. It was important to motivate people to learn by presenting everyone with opportunities for development, to create an individual focus through personal profiles, providing financial incentives to individuals to

After the MSC

125

give them real buying power and to offer transferable skills and qualifications. The aim was to establish a new culture in which schoolleaving age ceases to be an end to education. Careers for all, the CBI report argued, meant that employers needed to focus now on individuals rather than groups: ‘It should provide a single framework to guide and structure the development of foundation skills from 14 to 19 and a basis for continuous learning and training throughout working life’.86 The task force urged that the over-14s should possess their own careership profile. This document would be regularly revised during formal education and the early years of employment by discussion between individuals and their teachers or line managers. The personal profile is part of an individual focus. Employers are required, therefore, to maintain individual action plans, but it should be recognized that such profiles can only be effective when employees are informed about the likely consequences of their future careers. Financial incentives were necessary to prevent the situation in which young people are tempted by high wages without training or long-term prospects. The CBI called on government to fund a credit for all 16-yearolds to meet the learning costs in reaching NVQ Level III or its equivalent. The merits of the credit system were that they offered all young people an entitlement, treated them all equally, formed the basis for a vocational education market with the individuals as buyers and providers competing to meet their needs, offered an incentive to employers to see training as relevant to their normal employment needs, and even undermined nontraining employers because ‘young people in short supply would simply go to other employers offering training’.87 Yet public funding remained essential, because neither individuals nor employers could be expected to meet the full cost. The same principles should also apply to adults, and a training market was best encouraged there by introducing personal incometax allowances of £1,000 to those working for a national qualification. The CBI also urged that training should include the acquisition of broad personal competences through the development of common learning outcomes. The CBI’s act of faith was that ‘putting individuals first . . . will go a long way towards raising skills levels. Individual profiles and credits supported by careers advice, transferable skills and high quality qualifications will have a major impact’.88 The CBI report recognized that the careership proposal depended upon employers becoming true investors in people. The returns from investment were clear enough, as it is evident that those who invest in people achieve enhanced competitive performance: ‘In the 1990s and beyond, the future will belong to competitive companies and economies which compete on the basis of superior skills, responsiveness and innovative capability’.89 Too many employers still addressed present skill needs in a piecemeal way,

126

The politics of the training market

unrealistically expected that people with the right skills would always be available in the labour market and relied on ‘poaching’ from other firms. Fully committed employers are aware that training is part of a ‘people’ strategy, which includes career planning, and such Investors in People realize that training objectives and training plans flow directly from business plans, and set training targets to raise the skills of the workforce by defined dates. They link into careership by pursuing NVQ, and revising and updating individual action plans. The task force argued that a real training market must be created, and that individual credits were the means by which it could be established, with TECs acting as the regulators. It could be developed best by channelling as much as possible of the public funding for young people through individual credits, with employers paying wage costs, so that colleges and training providers would have every incentive to respond effectively to new market demands. The TECs would offer the quality assurance process by working together with the Training Standards Advisory Service. CONCLUSION There is no doubt that by 1990 training had become a high profile issue; and that, at the level of rhetoric, government, trade unions, employing organizations and national economic institutions were fully committed. It was the CBI which set the tone, and their proposal to transfer power to youths through an entitlement to credits threatened to dominate the agenda. All this was overshadowed in practice, however, by the government’s concern with the creation of TECs.

5

The rise of the training and enterprise councils (TECs)

MSC staff cannot have been astonished, in the aftermath of the TUC’s rejection of ET at the 1988 Congress, at Norman Fowler’s announcement that the TC was itself to be wound up to be replaced by new national training arrangements. Any observer of government policy and its underpinning ideology might also have predicted the general thrust of the proposals contained in the White Paper, Employment in the 1990s, published just two months after the announcement of the TC’s abolition. It has already been argued that an interventionist and tripartite body such as the MSC had enjoyed a quite anomalous existence during the first decade of the Thatcher government, explicable mainly because it solved problems during a difficult era of transition which other agencies were unable to address. The government’s ideological preference for a free market in labour and training policy had long been evident, however, and with the setting up of training and managing agents in its youth and adult training schemes, the MSC was adopting a less dirigiste approach towards employers. Equally apparent to observers was the government’s predilection for American models for policymaking. This reflected ideological bonds between the Thatcher and Reagan administrations, as well as the government’s judgement that the United States was an example of the ‘enterprise culture’ which it wished to establish in Britain. WHY TECs? The belief in the efficacy of the American ‘model’ helped to produce the contents of the White Paper, The Private Industry Councils (PICs). When Lord Young was Secretary of State for Employment he had expressed interest in the ‘private industry council’ (PIC) model, and when Norman Fowler succeeded him he determined to examine PICs while visiting Boston to observe the operation of the ‘compact’ scheme. Compacts were agreements between employers and older school children about employment guarantees

128

The politics of the training market

in return for the attainment of specified qualifications. While there, he discovered that the compacts had flowed from the PICs. So it was that Fowler and DE Civil Servants also examined the private-sector-led PICs in Massachusetts. It was common knowledge among the training cognoscenti that Kay Stratton, a member of Governor Dukakis’s gubernatorial office (which was presumably concentrating on the 1988 presidential election campaign at that time), was advising DE Civil Servants in the formulation of the White Paper. Kay Stratton had been executive director of the Boston Private Industry Council, followed by a period when she was given oversight of fifteen PICs in the state of Massachusetts, and had become involved in the national governors’ lobby group. Her initial involvement on the British training scene arose because of a system of international exchanges to allow legislators and policy-makers to look beyond their own turf. She thus spent some time observing the work of the MSC which she admired, before becoming involved in the TEC programme for which her American experience particularly fitted her. The centre-piece of the White Paper published in December 1988, the creation of the training and enterprise councils (TECs), therefore, occasioned no surprise. The issues involved in the transfer of policies from one country to another are highly complex. Yet it is clearly desirable for countries to learn from one another, since none possesses a complete repository of wisdom. J.D. Rosenau describes the phenomenon as an ‘emulative linkage’ between states.1 Yet there are pitfalls in too simple a transfer, as the cultural and institutional environments can diverge so sharply as to render the transfer positively dangerous. Policy analysts advocate the use of knowledge and experience acquired elsewhere in policy-making, but warn that unless due allowance is made for national differences the process can be irrational.2 That the PICs were less than the simple antecedent for TECs is clear. A national training authority? With the central role to be occupied by the TECs in the 1990s, the issue most in question was the continuing role, if any, for the erstwhile MSC as a national training authority. While the Thatcher government has pursued a less incrementalist strategy than its post-war predecessors, the policy-making pressures against the destruction of institutions – described by public policy theorists such as Hogwood and Peters in The Pathology of Public Policy – made it likely that the TA would continue in some form. This was particularly the case for a government which had made such substantial use of the MSC. Hogwood and Peters refer to ‘the reluctance that most people have concerning death carries over to an intellectual reluctance to consider policy termination . . . It is not death that is the ultimate pathology, but a fear of it’.3 The TA was

The rise of TECs

129

not terminated immediately, therefore, although its abolition was later announced in 1990. Even then there was a desire to refer to the TA being merged with the new Training, Enterprise and Education Division (TEED) inside the DE. So a national training authority in some form was to continue, and the premises in Sheffield continue to be used for the purpose. While the changes in the structures which organize and deliver training have been rapid, the twenty-month delay between the announcement of TECs and the abolition of the TA is explained by the reality that the government’s style of policymaking was of an ‘appreciative incrementalist’ character, and so it too was reluctant to kill an institution. The government also displayed a prudent caution in maintaining the TA until the TECs began to materialize. Before outlining the White Paper in which the new training arrangements were thoroughly described, it is necessary to explain the shift in policy from a centralized national authority to locally-led TECs. This reconstruction is possible with the assistance of senior officials who have been prepared to discuss the matter, but who cannot be directly cited. The context of TECs It is evident that TECs are far more compatible with the total thrust of government policy than the MSC and its successor bodies had ever been, and there was also a limit to the length of the period in which the government’s labour-market policies could diverge from its policies in other spheres. The crisis of youth unemployment had persuaded government to utilize a quango, contrary to all earlier Conservative protestations that they were a symptom of an overweening state. Once the youth unemployment crisis had diminished, and in any event was perceived not to have led either to further riots or to the defeat of the government, ministers were less inclined to adhere to the institutional legacy of the 1970s. This was particularly so given the tendency for the Commission itself to begin to behave like a TUC-driven obstruction to the implementation of central government policy. J.G. Bulpitt argues that the main impulse of Thatcherism was to resolve the perceived ungovernability problems of the 1970s by pursuing a political strategy to restore state authority, or ‘the autonomy of the centre’.4 If the TC was going to manoeuvre politically to prevent the government from implementing its deregulating labour-market strategy, then clearly it would exhaust the patience with tripartism. One senior official asserts that, by October 1988, the irritation at the trade unionists role over ET extended throughout the entire Department of Employment. While the DE and its ministers, supported by the Cabinet, were intent on purusing the PIC model, there might also have been a TC operating alongside the TECs. The TC’s transmogrification into the TA in the autumn of 1988

130

The politics of the training market

proved to be short-lived, as has already been pointed out, and within two years the TA’s abolition was announced. This development occasioned little surprise, and both CBI and TUC officials described it as ‘inevitable’.5 Officials also assert that it is impossible to understand the government’s pattern of thought about TECs except in the context of the repeated failure of British employers to commit themselves adequately to training. This is the key to understanding shifts in training policy. The history of training policy clearly has a continuing relevance, therefore, in understanding contemporary developments. The government considered that both the ITBs and the MSC had failed to make a positive impact upon the traininginvestment decisions of employers. While there was a period when the involvement of trade unions in the MSC had served a useful purpose for the government, the CBI for its part had never been fully engaged. The CBI representatives on the Commission were not linked to the broader membership, and the area manpower boards (AMBs) had been particularly ineffective in enthusing employers to play an active role. Since the Conservative government wants employers to assume more of the costs of training, and was disconcerted at the failure of the AMBs to activate employers locally, the decision to experiment with the TECs becomes more logical. It was natural that employer representatives on the AMBs would lose interest, given the apathy of the CBI to their activities and their lack of executive or budgetary powers. Government ministers perceived the TECs as able to resolve this problem, in a manner consistent with the principles enunciated in the 1981 NTI and the long-standing concern to increase employer involvement. The government’s desire to create a dominant position for employers ensured an inevitability about the ending of tripartism in employment and training policy-making by the late 1980s. It was essential, therefore, for the government to conceive of a device to engage employer enthusiasm, and ministers decided that in order to achieve that goal it would be necessary to provide employers with real executive powers. Such powers made it the more likely that the TECs would be able to attract the biggest and best of the local employers, since they are a far cry from the merely advisory AMBs. Yet senior MSC officials predicted in 1988, before the White Paper appeared, that employers would only be willing to play their part if they were granted real executive and budgetary powers. The reluctance actually to concede these was important in generating the conflicts which almost defeated the TECs in their earliest months. This view was advanced by leading members of the TC’s policy and analysis branch as early as 1988. The same lesson was negatively learnt from the experience of the TECs. Officials involved in the discussions surrounding the PICs and their relevance to the TECs considered that transplantation was sensible given the problem

The rise of TECs

131

in both countries, and that it was necessary to shift the training impulse – from dealing with the needs of the temporary and long-term unemployed to that of training and updating the entire workforce. The British government also was engaged in the encouragement of public/ private partnerships in other areas of policy (such as local economic regeneration and community care), and the PICs were a solution to the question of the appropriate role for public institutions in this area by their engaging the private sector in education, training and enterprise. Yet the PICs were regarded as unsuccessful in areas crucial for the desired British strategy. There were three obvious shortcomings in the PICs, which could prove fatal for the key role which their British counterparts were expected to carry out. They appeared unable to preserve a high quality membership, had too narrow a financial base and were given too limited a remittance. The legislation setting up the PICs failed to require high-quality council membership: for example, that companies should be represented by chief executives rather than human resource directors. Neither did it grant a capacity to address issues other than training, when, to fulfil their functions effectively, PICs should have been given a purview over education and other related areas. Finally, the funds for PICs were channelled through the local authorities who also employed the staff, thus the PICs were denied proper executive authority. Nor was the money adequate. The Reagan presidency imposed a 1,000 per cent cut upon the Boston PIC, so that, despite expenditure reductions, public funding for training in Britain was more substantial than in the United States. The three weaknesses in PICs led to both a deterioration in membership (so that chief executives and managing directors lost interest) and to PICs being driven back to a narrow focus upon the long-term unemployed. British policy-makers returned from Boston anxious to avoid the vicious spiral that they detected in the PICs. They were adamant about the need to specify a ‘blue ribbon’ board for each TEC, and to grant a remittance and a set of powers that would retain highquality membership. It was also considered necessary, and this dove-tailed neatly with other government preoccupations, for TECs to have a greater independence from public funding so that top businessmen would not feel like state agents. The DE’s policy-makers did not reckon, however, on the centralist tendencies of the Cabinet or the potency of the British Treasury. But that is a later part of the story. Given the DE’s strong commitment to creating PIC type agencies, there is a sense in which the 1988 TUC Congress fell into a trap set by Norman Fowler and the government. Since TECs were in the policy frame irrespective of the Congress’s decision on participation within ET, the TUC decision to boycott the scheme at the September 1988 Congress provided an opportunity for the Secretary of State to justify his apparently drastic action in ending the Commission. And the action was drastic, since it has been pointed out

132

The politics of the training market

that it was the ending of the Commission’s role which was the watershed in policy rather than the ending of the MSC a year earlier. It was the removal of the vestiges of tripartism which inaugurated a training market entirely under the government’s direct management. It must be recalled that, even before the controversy over TUC participation in ET, Fowler had proposed to change the representation on the Commission and on AMBs to provide a clear majority for employers. The most that can be claimed for the strategy of remaining within the ET from the trade union perspective is that the TECs might have emerged with a less ‘skewed’ representation in favour of employers, the TC would have continued as a national authority, and TUC withdrawal was mere ‘gesture politics’ of no benefit to the adult unemployed. Norman Fowler’s reaction to the TUC decision was almost one of pique. He was aggrieved because he was particularly committed to ET, and had modified it in order to win the support of the trade unions. Their withdrawal was an irritant. Had they remained, then TECs would still have been introduced but the TC would also have continued. Few of the actors emerge from the ET episode with credit. Various trends converged in the autumn of 1988 which explain the timing of the TECs’ emergence. There were growing reports of DE officials based at Caxton House, London, feeling that the TC’s officials had too much independence and that they should be reined in, but such perceptions would not on their own have led to the Commission being wound up. More significant was the appreciation that unemployment was falling, and a perception (even if already ‘lagged’) that the economy was flourishing, so that the emergency programmes at which the MSC was adept were no longer required. This appeared to be the propitious moment, therefore, for the DE to take the gamble of investing in its aspiration for greater employer participation in the management and delivery of training. One official, recognizing the direct influence which Downing Street possessed over policymaking under Margaret Thatcher, pinpoints the importance of one individual Scottish employer, Bill Hughes of Grampian Holdings, and of his standing at the time with the Prime Minister. As chairman of the Scottish Enterprise Agency he impressed her as a beacon of the ‘enterprise culture’ in a society which she considered marred by the syndrome of dependency. Another official considers that she misperceived the intentions of those who promoted the Scottish Enterprise Agency, however, as its leaders also proved to have a ‘begging bowl’ approach since they were essentially seeking greater public funding to promote training and enterprise. But it is perceptions which are salient in the policy-making process rather than realities, and so Hughes exerted an important influence at a key juncture. The episode is particularly revealing about the style of government operated by Margaret Thatcher. In the typology of theories which contend with each other to explain the policy-

The rise of TECs

133

making process within Britain’s core-executive it is that of government by prime ministerial clique which this episode suggests. While Margaret Thatcher tended to dominate the policy-making process, she did so primarily with the assistance of favoured advisers, often drawn from right-wing ‘think tanks’. It appears that Hughes and others wielded influence in this case. With regard to training policy it appears that the idea of a prime ministerial clique is a more convincing explanation of the process than the cruder idea of personal prime-ministerial power. Naked bureaucratic power is harder to sustain as an explanation; and while there are examples (as in the case of ET already discussed) of the operation of both ministerial and of Cabinet government, it is the image of an unusually active Prime Minister who relied upon ideological and personally sympathetic advisers which is most authentic. Margaret Thatcher was also a strong advocate of the American ideological model, however, and it was common in her government for groups of ministers and Civil Servants to adapt American examples in the process of creating new policies to promulgate an ‘enterprise culture’. Coupled with the influence of individual British ‘new right’ ideologies, therefore, was the impact which the state of Massachusetts particularly had upon the Secretary of State Norman Fowler and his officials. Delegations of senior policy-makers frequently visited the United States in the search for policies to emulate in the field of education and training. It seems likely, therefore, that the PICs had a major and direct impact upon the formation of the TECs. It should also be stressed, however, that some of the officials actually involved in the process of policy formulation believe that the PICs were somewhat less significant, and merely had a reinforcing effect, as they provided comfort that locally-based, employer-led units could succeed. The same officials also repeat the argument already expressed that PICs demonstrated how not to provide locally-based, employer-led training organizations. Instead, British TECs should follow a different path: with the appointment of a strong chief executive with professional support staff; the firm requirement for chief executives rather than personnel or training officers on the boards; bigger budgets and a more pervasive role rather than, as is the case with the PICs, an emphasis on Workfare or ET activities. Whether or not the PICs played a directly influential role, however, they served to reassure British policy-makers that they were not embarking upon completely unknown territory. An immediate effect of the TECs was the diminished role which they left for the TA to perform. The head of the former TA, Roger Dawe, attempted to maintain staff morale by minimizing the impact which the change would have upon TA programmes and its employees. Sir Geoffrey Holland at the DE also reassured TA staff when he pointed out that there were to be 100 TECs as against 57 TA area offices, and he argued that working for the TECs

134

The politics of the training market

would be more challenging. TA staff would be seconded to the TECs and TA regional officers would monitor TEC progress.6 In the interval the TA would continue to operate its existing programmes, but those who opted to transfer to TECs would retain Civil Service status. Such reassurances were based upon an understanding of the inherent incrementalism of the process of policy change, the real need for continuity and expertise, and also by the lessons which the PICs taught about the need for professional support staff. The rapid emergence of the TECs, on the other hand, and the early signs of their independence to vary the application of programmes locally, suggest at the very least a process of ‘appreciative incrementalism’, and the merging of the TA into TEED supports that view further. Yet if the government was pragmatic and incrementalist enough to employ a statist quango such as the MSC as an interim measure for the purposes of crisis management, it was ideological and radical enough to ensure that the MSC could not become permanent. The government behaved in an ‘appreciative incrementalist’ manner in acting upon its assessment that the MSC was not transforming employer attitudes towards training. Shorn of its tripartite trappings, the TA was safely confined within the DE, until it was formally collapsed into the Department in 1990. Having considered the policy-making dynamics which generated it, it is now necessary to describe and analyse the White Paper itself. THE WHITE PAPER EMPLOYMENT IN THE 1990s: DESCRIPTION AND ANALYSIS Employment in the 1990s was the product of a government happy to apply its own ideology to all areas of policy. There is little evidence of a direct input by such right-wing think tanks as the Centre for Policy Studies and the Adam Smith Institute which were active in many other areas of policy development. Nor was the Hillgate group of intellectuals (including such figures as Oliver Letwin and Baroness Cox and others, which had influenced the detail of the 1988 Education Reform Act) to the forefront. The Hillgate group was not interested in training, which had been much more the legacy of such ‘in house’ policy makers as Lord Young and of DE officials. Nor was the CBI decisive in its influence, since its preferred strategy of training vouchers for all young people was disregarded at this stage in the policymaking process in favour of the American free-market influence of Massachusetts. As Chris Price argued, Mrs Thatcher inclined to accept DE and TA advice about policy because she believed that their interventions in the education system have been beneficial to a ‘sluggish, teacher-dominated and unresponsive education service’.7 Yet it was the DE rather than the MSC which made its mark upon the White Paper, which was written by a small

The rise of TECs

135

group of DE Civil Servants without the benefit of MSC advice. This is significant because between April and October 1988 the MSC was engaged upon a report, with the assistance of Deloitte Haskins, to advise government about some improvements to the British training system.8 It appears as if irritation with the non-cooperation of trade unionists with ET, coupled with a preference for a more vigorous free-market approach, led the DE to neglect the MSC’s judgements. So it was that there was no major follow-up to the influential 1984 Competence and Competition, or the 1987 A Challenge to Complacency reports in which the MSC had been central, and so Employment for the 1990s was an example of direct policy insertion by the DE. The White Paper regarded the dearth of appropriate training in Britain to be one in a series of obstacles to employment. It argued that excessive regulations also discouraged employers from recruiting staff. Its view was consistent with the government’s animus towards the EEC Social Charter, which Norman Fowler contrasted with the British government’s policy of removing barriers to job creation, which he claimed to be the most effective form of social policy. It was politically fortuitous that a ‘new right’ liberal economic policy could also be presented as an effective social policy. It is true that the government’s ideological assumptions as expressed in the White Paper left it open to the charge of commentators such as Tipton and Gleeson – that the types of employment which are available are to be uncritically accepted, and that personal deficiencies on the part of the mass of employed and unemployed people alike need only to be remedied for the market to be able to generate full employment. The nature of existing work opportunities are perceived as given, and there is no attempt to combine policies for training with methods of improving the design of work. Since so much gainful employment is monotonous and humdrum it can be argued that government and employers should first address that issue before focusing upon the shortcomings of the workforce. 9 The White Paper made no pretence of offering training through the new TECs in order to enhance personal fulfilment through work, but was narrowly concerned to improve the skills of labour in order to maximize employer profits. An MSC official acknowledged that many of the jobs created in the economy during the ‘boom’ from 1982 to 1988 were ‘crummy’, and so he implicitly acknowledged the dual labour-market theory’s bifurcation of employment opportunities. The radicalism of the training revolution which the White Paper advocated was greatly circumscribed. It was less intended to improve the life experiences of individuals than to remove barriers to employment alongside such other methods as weakening collective bargaining, restricting wages councils and privatizing Skillcentres. To ensure that training produced an employerled definition of market growth, control was to be transferred from the

136

The politics of the training market

educationalists to the employer-dominated TECs. Naturally, such an interpretation of the philosophy of Employment for the 1990s is rooted in ideology, and is only discussed here as a counterweight to the orthodox DE arguments shortly to be summarized. There was considerable anxiety at Sheffield’s Moorfoot during the period from September to December 1988 when the White Paper was being written. Norman Fowler’s visits to observe the PICs were well known, and TA officials also understood that Workfare and compacts in the same state (Massachusetts) had influenced ET and compacts in Britain in the previous couple of years. Yet, as there was no formal consultation with the policy analysis branch at Moorfoot, resigned speculation prevailed. The publication of the White Paper occasioned few surprises. It duly associated training with deregulation and enterprise as employment stimulators; and it proposed the local management and delivery of training, as the Secretary of State had foreshadowed in his September statement in which he announced the TC’s demise. Yet the White Paper’s authors were compelled to recognize that in a unitary state with a more integrated economy than that of the United States, it was necessary to have a partnership between delivery at the local level and the national formulation of policy and priorities. More consistent with the Boston freemarket model, however, was the assertion that ‘the prime responsibility for this investment lies with the employer’.10 The main motivation of the White Paper was the anticipated labour-market problems of the 1990s, particularly the fact that ‘the most radical change is in the number of young people in the labour market’.11 The two main and related implications were the greater stability in the labour force (whose members had thus to become more flexible) and the consequent need to tap new sources of recruitment. Both necessitated a broadening of company training policies. The White Paper also suggested government concern with the implications of 1992, as it referred to the competitive knowledge-based international market and to the opportunities of the 320-million-strong European market. It argued that the situation could only be met by the establishment of an ‘appropriate training system which will ensure the provision of relevant skills’.12 Yet the reform of training could only generate required economic improvements, or so the document argued, if there was also a wider deregulation of the labour-market. This required the employers’ right to determine whether or not to recognize trade unions, and the individual worker’s negotiation of terms.13 Evidently, training policy was not to be a part of a long-term radical project to remedy the problems of ‘the dual labourmarket’ by improving social, as well as economic life. Anticipating its main proposal for structural reform, the White Paper emphasized the need for training to be responsive to local labour-market conditions. The same principle of local responsiveness, it argued, should

The rise of TECs

137

also apply to plant bargaining and performance-based pay, and in the public sector to continuing privatization, deregulation and competitive tendering. There was a clear acknowledgement, as a point of triumph, of one of the main criticisms of the YTS, which was that it had encouraged ‘more realistic levels of youth pay by holding at reasonable levels the minimum allowances paid in youth training schemes’.14 The Permanent Secretary of the DE, Sir Geoffrey Holland, also proclaimed that youth wages had been too high, had been forced down by YTS, and should be kept at a low rate. Concerned that the gap between youth wages on the one hand and grants for further education and training allowances on the other had narrowed, he was anxious that a tightening labour market should not lead to employer capitulation in the 1990s.15 Employment for the 1990s was unsympathetic to employer claims about skills shortages because during periods of recession ‘some employers take a short-term view and cut back training intakes so that the supply of trained people has been inadequate during the subsequent recovery’.16 Consequently, with its ‘new right’ ideological assumptions, the White Paper claimed that the long standing dearth in British training provision, including the poor involvement of employers, was to be attributed to past emphasis upon inflexible national strategies. It argued, in contrast, that Germany and the United States possessed locally based training systems, with continuous involvement by employers and educational interests. Such approaches were sound because it was locally that jobs and skills needs arose.17 The criticism of past national strategies can only be interpreted as including the work of the MSC and its successor bodies. Yet that same body had been highly praised and funded by the same government which was now condemning its general approach. This apparent paradox helps to explain the puzzle as to why the Thatcher government exceptionally promoted a statist quango. If the goverment was pragmatic enough to exploit the MSC as an instrument of crisis management, and over-optimistically as a catalyst for a free-market upsurge in training, it was ideological enough to deny the MSC a permanently powerful role. Since the MSC had not transformed Britain into an unambiguously enterprise culture, the DE determined that the time had arrived to link training policy to economic success and to enterprising companies. The MSC’s image was irretrievably associated with training the unskilled, and with short-term pump-priming. Further, it was not of itself a part of the market. The White Paper clearly tried to create the circumstances of a training market and attempted to link training issues to business plans and to market demand. It reflected the government’s view that the principle of the market was best achieved if training were devolved to local areas, with both public

138

The politics of the training market

and private provision aimed at meeting business and individual needs. Yet the government was compelled to acknowledge that there were also national and industry level spheres of activity, although the organizational infrastructure which it proposed to deal with the national and industry levels was weak. There was a paradox about the entire governmental venture, however, in that it was creating statutory organizations which it was expecting to operate on commercial and market-orientated principles. Even if the operation can successfully be applied in practice, the government was admitting that continued state monitoring from a national perspective was required if the necessary expansion of suitable training was to occur. The national level was to be taken care of by the continuation of the TA, which would carry on with existing schemes until the TECs were ready to assume responsibility for them. It was to be a unit within the DE, and would continue to work with employers, educators, voluntary organizations, training providers and individual trade unions to improve the relevance of training. Yet its role was to change, possibly in line with the report of Sir Robin Ibbs on the reorganization of government services: The Training Agency will employ the staff who previously reported to the Training Commission which . . . will continue in Sheffield. The size,. .. its focus and its status as a discrete management unit accountable to the Secretary of State for Employment suggest that it might become an agency of the kind described in The Next Steps.18 This bland statement represented an important institutional change. Just two years previously, the MSC had appeared to be a collossus, and then it lost its employment functions, experienced attempts to change the composition of its commission, lost its independent status and found much of its training role usurped by the new TECs. As a further diminution of its responsibilities, however, and notwithstanding its loss of trade union and local-authority influence, the government considered it necessary to put in place another employer-dominated body to ensure that employers were full partners in the design, delivery and finance of training. ‘The government have, therefore, decided to establish a National Training Task Force to advise the Secretary of State for Employment, and to assist him in carrying out his training responsibilities throughout Great Britain.’19 The National Training Task Force (NTTF) was provided with a four-year time-span, and TA officials say that this was a deliberate decision to avoid creating a permanent institution which would acquire its own momentum.20 If so, this was an error, rectified in 1991. The principle of short-term agencies was one which the government had recently practised with reference to the delivery of adult and continuing education, where temporary bodies had

The rise of TECs

139

been established to undertake a specific remittance from government, with the possibility of renewal only if the government’s objectives had been achieved. In public policy theory this has been compared with a medical check-up, and it occurs when the activities of an organisation and its request for continued funding is reviewed: ‘This offers a regularised opportunity to judge not only the financial probity of the organisation, but its policy effectiveness as well’.21 Short-term contracting was also a useful instrument for the ‘new right’ approach to government organization in that it undermined permanent professionalism and enshrined performance-related evaluation. Certainly, the TECs were given a clear enough role against which to be appraised. The NTTF’s purpose, therefore, was to accept or reject the applications of local consortia to become TECs, as well as to stimulate employers to invest in training. Employer domination of the NTTF was apparent, with eight out of its eleven members drawn from industry and commerce. The first chairman is Brian Wolfson of Wembley Enterprises, who had previously served for a short time as chair of the TC. It became clear by the beginning of 1990, however, that the NTTF was falling apart, as many of its members (not including Wolfson) appeared to lose interest in its work. This was largely because it lacked executive powers and enjoyed a merely advisory role. In reality it was departmental and TA officials who approved the applications for TEC status. In the Calderdale/Kirklees case, for example, the corporate and business plans were dealt with directly by officials and were never sent to a NTTF meeting. Formalities were preserved to the extent of requiring Brian Woolfson to agree to the plans. It is evident to most TEC board members and officials that the NTTF was conceived by the government to encourage the new employer-led TECs to seek approval through a simple organizational mechanism rather than having to apply laboriously through many layers of bureaucracy. Yet the attempt to offer an acceptable face to the embryonic TECs was actually stymied by the government’s reluctance to create a new powerful national body. The NTTF’s weak powers led most of its members to lose interest, and as a result, the TECs’ directors were required to meet the bureaucracy after all, and the experience was sufficient to disillusion many. By late 1991, however, the NTTF was retrieving a limited role as the overseer and supervisor of progress towards the achievement of the government-endorsed CBI national training targets. The NTTF also began to work with TECs ‘to develop effective arrangements for awarding the “Investors in People” standard to organisations of all sizes, and will award “Investors in People” to national organisations’.22 As will be mentioned later, Investors in People (IiP) is a joint DE/TEC initiative to offer a ‘kite mark’ to companies with effective training strategies. It was a further attempt to demonstrate the link between training and economic success.

140

The politics of the training market

The document Employment for the 1990s emphasized the need for the establishment of industry-wide employer-led organizations which would set nationally recognized standards on a sector-by-sector basis, although this was not to be compulsory.23 Evidently the shift towards decentralized training delivery was not total, since there was recognition of the need to supplement it with national and industrial level activities. Such a lack of conviction appeared redolent of a government torn between the free economy and the strong state, a confusion which the White Paper did not help to clarify when it added that there would be government guidelines for sectoral training organizations to aspire to, and that the TA would review progress sectorally. Yet the DE was more consistent in its attitude towards the ITBs. While seven would continue to function (in the clothing, offshore petroleum, engineering, hotel and catering, plastics, road transport and construction industries), they had already lost their earlier grant and levy powers, and the White Paper preferred voluntary employer commitment through independent non-statutory bodies.24 The same competitive approach was applied to the MSC’s own Skillcentres. Quoting from National Audit Office (NAO) and Public Accounts Committee reports, the White Paper echoed their criticisms that the MSC was committed to purchasing fixed amounts of training from its own centres – which meant that it was paying higher costs than was required on the open market. Despite this subsidy, the centres still contrived to lose £20m. on a £55m. turnover; so the White Paper stressed that in future the Skillcentres would have to tender for business under government schemes and to follow best commercial practices.25 The centrepiece of the White Paper consisted of the plan to create TECs. It was argued that since business growth and development actually occurred at a local level, training should logically follow the same pattern. Local employers were the best placed people to create a skilled workforce and an entrepreneurial climate for job creation. They were better equipped to assess the needs of the local labour-market than remote centralising planners and bureaucrats, and each community possessed the vision to link vocational education and training (VET) to economic and industrial development. Employment for the 1990s invited local employers, therefore, to submit proposals to create TECs to contract with the government to plan and deliver training, and to promote enterprise through the establishment of small businesses and self-employment. The putative TECs should demonstrate that they had secured the support of local employers.26 Sir Geoffrey Holland argues that this was best achieved by involving the largest employers in the area in order to give the process credibility. He adds that only a significant organizational structure with real executive powers is likely to attract large-scale firms and good managers to participate.27 The experience

The rise of TECs

141

of the MSC’s area manpower boards supports his contention because they failed to engage the interests of substantial businessmen. It is also the case that TECs would only impact upon the local economy if large firms became involved. In short, the White Paper argued that the ownership of TECs must lie with employers.28 The main functions of TECs are to examine local labour-markets, assess skills needs, evaluate and expand job prospects and create training opportunities. Local groups of businessmen were invited to draw up plans stating the measurable objectives which they set themselves in the realm of training and enterprise. These objectives were required to include the meeting of government guarantees and community needs, the tailoring of national programmes to meet regional needs, the effective management of youth and adult training and retraining programmes, and the provision of assistance to small businesses. To secure acceptance from the NTTF, potential TECs would have to produce a prospectus which demonstrated their possession of a determined leadership capable of affecting change, managing public funds and representing all sizes of firms as well as other community interests. This leadership should comprise two-thirds of its members (with senior managers from the private sector), and the remainder of the membership drawn from the ranks of senior local educators, organizations of training and economic development, voluntary bodies and trade unions. It was suggested that existing local employer networks, chambers of commerce, or the CBI might form the nucleus of the new TECs. It appears that representatives of the chambers influenced Fowler when the White Paper was being written, since in practice they have not proved an effective nucleus, because unlike their German counterparts they tend to reflect a bias in favour of small and mediumsized firms. The TA was to continue to organize the DE’s training schemes during the period when the TECs were being set up. Local staff of the TA would be transferred to the TECs and, in the short term, TECs would have contracts with the TA to provide such schemes as YTS, ET and the Enterprise Allowance Scheme (EAS). The contracts would provide for accountability in such areas as numbers served, qualifications obtained, jobs secured, businesses supported and unit costs, and the annual reports of the TECs would describe their activities in these fields. TECs would in their turn subcontract work to training providers and would renew contracts on the basis of performance. Because of the efficacy of ATOs, Employment for the 1990s urged the TECs to set up the same type of bodies to deliver training programmes. Yet for unstated reasons both the TVEI and workrelated FE were to remain with the local authorities and no rationale was offered for this separation.

142

The politics of the training market

The White Paper reflected the government’s long-standing desire to transfer the costs of training to employers, and was posited upon the hope that by giving responsibility to employers through TECs they would come to appreciate the importance of investing in training. Employment for the 1990s was also concerned to demonstrate the compatibility between the TECs and other initiatives such as the core curriculum, TVEI, the Department of Trade and Industry’s ‘Enterprise and Education’ initiative, the DE’s own Enterprise in Higher Education Scheme, and the new Work-Related Further Education planning system. So, while the TECs were to be the new change agents in training and enterprise, they were clearly circumscribed by their partnerships with many other actors in achieving the complementarity of education and training, as well as by the requirement to guarantee the continuation of the budget providing government training schemes. The White Paper made at the least ritual obeisances towards the notion of lifelong education by pointing out that 70 per cent of those likely to be employed in the year 2000 were in jobs in 1988, and that all workers would benefit from training at all ages. Despite Pickup and other TA initiatives, the document deplored that less than half the workforce ever appeared to receive training. Yet it was evident that the White Paper looked to agencies other than the state to deliver lifelong education and training, and sought to confine the state’s role to backing private-sector pace-setters: ‘Developing training through life is not primarily a government responsibility. Employers must take the lead’.29 The TECs were also to assume responsibility for a new training programme, Business Growth Training (BGT) which was designed to encourage small and medium-sized businesses to grow and develop. There is a certain irony in the White Paper’s protestations that the TECs were to enable employers to take responsibility for the promotion of training, yet simultaneously it was considered necessary to introduce an entirely new national programme to ensure the development of enterprise and business skills. The TA, the NTTF, LEA education and training, and a plethora of other schemes appeared to undermine much of the independence which the TECs had hoped to enjoy. The White Paper’s defence was that employers must be the providers and consumers of training, but that the government should set up a national framework to ensure that the proper scale and quality of training was being made available. This argument failed to convince the TECs subsequently, when the government refused to set up a strong national body with the power to enforce national training targets and standards. It is widely believed that Norman Fowler had argued in Cabinet for clear national targets to provide a yardstick against which the performance of TECs could actually be quantified. He was defeated in Cabinet, however, which demonstrates that Cabinet government can sometimes defeat straightforward

The rise of TECs

143

ministerial power, even if the outcome proved to be less favourable for a vigorous enterprise and training strategy.30 There is no evidence that this defeat encouraged Fowler’s resignation from the Cabinet at the start of 1990, although he clearly considered that the TECs were being impeded. His successor as Secretary of State was Michael Howard, who merely offered the protesting TEC boards an NTTF ‘action programme’, which many consider to be an inane substitute. Its merit to the government was that it cost less. The Major government modified the position, however, when it accepted CBI-generated targets in 1991. James Buxton argues that ‘it is fashionable to be sceptical about TECs’. He suggests that this has been precipitated by the trimming of government funding between the publication of the White Paper and the creation of the TECs, together with ‘the lack of flexibility on how the funds may be spent’. Yet the TECs had their early supporters.31 Michael Fass and Richard Scothorne argued that TECs and their Scottish counterparts, local enterprise councils (LECs), were correctly conceived with the functions of blending enterprise development with training by means of devolution to local bodies.32 They suggest that helping people to find work and improve their skills is the same process as aiding small and medium-sized businesses to establish and develop. This is because both processes deal with people, and both people and businesses in the market place must assess and promote their resources. The virtue of locally-based bodies is their superior capacity to deliver accountability and long-term relationships with clients.33 Fass and Scothorne clearly sought greater power for TECs and LECs, however, to enable them to ‘call down’ services, rather than the local agency itself having to be under contract to a higher body. While accepting the need for a regional or national body to prevent duplication and to undertake labourmarket planning and research, they criticize organizations which ‘behave in a remote and hierarchical manner’, and produce aims, objectives and ‘rigid schemes for large groups of people’ which ignore individual needs.34 James Buxton suggests that Fass and Scothorne were criticizing the TA in their comments that when ‘success is measured by the number of clients entering or leaving their doors, it is no wonder that some providers are motivated to do little more than attract as many clients as possible and retain them for as long as possible’, and when ‘performance is measured by reports delivered and funds spent, it is no wonder that services extract capacity from clients rather than add skills’. There were also some obvious deficiencies in the White Paper at a purely theoretical level, however, even before it was put to the test. The Labour Party’s criticisms were predictable enough and centred upon the paradox of handing over the organization of British training policy to the employers, who were the very group which had created the crisis by failing to invest

144

The politics of the training market

adequately in the past. Michael Meacher, the shadow employment spokesman pointed out that Britain’s industrial competitors approached the problem from the perspective of a national strategy, whereas the TECs were essentially unrepresentative, unaccountable, local quangos, which were to be provided with no additional resources. Nor was it sufficient merely to lift ideas from the United States – where there existed anti-job-substitution laws but also exploitatively low pay rates. In short, the policy would lead only to a lowwages, low-skills and high-unemployment economy.35 Yet if this appears to be negative and partisan, some similar doubts were expressed by the Financial Times (FT). An editorial expressed doubt about the ending of national tripartism, and about the inadequate discretion provided to the TECs to design programmes specifically for local labour markets. It was also sceptical about the efficacy of short-term grants and incentives which, in merely temporarily offsetting training costs, proved a weak influence upon the propensity of firms to train: ‘Among the recipients of grants, the general view is that grants make no difference to the training that they do’.36 The newspaper was convinced that it was by a positive training culture in which top management is fully committed that economic success results. This often failed to occur in British firms because training is organized as a specialized compartment rather than as an integral part of a company’s overall organization. Trade unions were also culpable for being more concerned about health, safety and conditions rather than training policy. The editorial described disaffection at the bottom of society as a ‘timebomb’ since only 13 per cent of the 16–18 age group was in full-time education and training. It quoted Sir John Read of the Trustee Savings Bank, in a judgement far removed from the ideology of the White Paper, when he commented that ‘at national level, just as at company level, better personnel planning will do much to add to our success both in human and financial terms’.37 The FT recognized improvements in the British training scene in the 1980s, but its comments were a tepid endorsement of the MSC’s work and a criticism of the White Paper’s perspective. It described the array of acronyms which dominate the training scene as evidence of the piecemeal nature of provision, and doubted whether new institutions modelled upon West German chambers of commerce and American private industry councils could rapidly make up for thirty years of skills deficits. The problem was reflected in the situation in which half the nation’s employees received no training in the previous year, and a third had never received any. The skills shortage in British industry was thus both ingrained and persistent, and so the British economy was in ‘a low skills equilibrium’. Yet the new production methods coming into use during the 1990s required a heavy skills investment in both managers and workers. The editorial was even critical

The rise of TECs

145

of the extent to which the government had undermined the trade union movement, since a weak labour movement tends to become a weak link in the growth of labour-market training. It regretted that the government was hostile to direct intervention in the market to build up a consensus, among employers, workers and unions, in favour of VET. The Financial Times was anxious that the White Paper had not really presented a modernizing agenda. That agenda required seven further steps. These were: the unification of the plethora of schemes; a three-year YTS with more off-the-job training leading to qualifications; improved training for the 19–24 age group who remained outside higher education; the enhancement of ET so that training is linked to redundancy and to the needs of the over 55s; a generous budgeting of the new TECs until the employers actually did assume the majority of the financial responsibility; the continuation of the ITBs and the establishment of employer training bodies in all other industries; and the provision of a training passport for all employees to be financed by an occupational training fund. Recognizing that both employers and government were averse to an occupational training fund and to statutory training, the newspaper urged more in-company schemes independent from training boards but statutorily underpinned. For a proper training culture to emerge: ‘Employers, unions and workers need a shock’. Its conclusion was even more redolent of a previous era of consensus since it recommended a close link between the education and training ‘industries’. Some of the national problem was rooted in poor mathematics and science teaching in schools. In any event, training was apparently too important to be left merely to trainers, and so should not just be left to local businessmen, or occur on employers premises. ‘Successful businessmen are not educators. Businessmen are necessarily driven by short-termism’. The editorial left its most damning criticism to the last, when it pointed out that individual employers in a free enterprise system do not have an incentive to provide an efficient overall level of vocational training.38 The Financial Times also perceived that without national encouragement and direction effective training could not be brought about. It had little doubt that Michael Howard’s appointment as Secretary of State to replace Norman Fowler marked a deterioration in the government’s commitment to a full and proper training system. In training, the government must also provide clear leadership, must set the goals by which the community as a whole will be judged. Last year Sir Norman Fowler did just that; half the employed workforce, he said, should achieve the NCVQ’s level three (roughly the equivalent of A levels) by 2000. Mr Michael Howard, his successor as Employment Secretary

146

The politics of the training market

has dismayed many in the training world by refusing to endorse such goals. He argues (wrongly) that the narrow performance targets set by individual TECs are a substitute for these wider objectives.39 Equally seriously, the TECs were dominated by an agenda from the 1980s, since most of their budget was taken up by programmes targeted at the young jobless and the adult long-term unemployed. Such schemes failed to deal with the skills shortage among the employed workforce, the newspaper continued, and failed to offer a substitute for the rigorous apprenticeship schemes found abroad. Even the NCVQ’s approach was insufficiently rigorous, since it did not involve written and practical tests, nor require trainees to carry on with mathematics or languages.40 All this was to be regretted, since there was business enthusiasm for the TECs, and in conception they were a welcome balance between central direction and local autonomy. It was unfortunate that the central element was unsatisfactory. Such comments were neither extreme nor unusual. A leading Yorkshire employer also expressed the view that TECs had been set up too swiftly and contained the roots of their own failure. This was because they were underfunded and their work was dominated by the obligation to carry out existing training schemes, which accounted for the great majority of their budget.41 More seriously, senior MSC officials, possibly protecting vested interests, made a number of serious and convincing criticisms of the proposal to create TECs. They commented on the need to maintain a national dimension to training policy, since the whole is more than the parts. They also expressed regret at the ‘brutal’ manner in which the TECs had breached the principles of collaboration between the various interests which previously comprised the training community. The near exclusion of trade unionists, local authorities and educators, it was argued, had caused unnecessary ill-feeling, and TECs would have to work hard to recreate the spirit of co-operation.42 While it is true that training and enterprise activities should be organized by businessmen who are sympathetic to the entire conception of enterprise, and that employers are best able to determine appropriate training needs, the officials were correct to deplore the exclusion of other interests. In one sense officials were too generous. They accepted, and with a certain amount of logic to support them, that to gain credibility the TECs would first have to attract the support of large firms. However, since successive reports demonstrated that the main problem of underinvestment in training lay with small and medium-sized firms, there appeared to be little concern with directly addressing that urgent problem. There was also the somewhat complacent assumption that the private sector had sufficiently mended its ways so that the necessary resources would be forthcoming, without either the statutory enforcement favoured by the

The rise of TECs

147

Financial Times, or some idea such as the training tax with which the Labour Party was toying and which had been considered necessary in Japan. Above all, there was the contradiction between individual and collective rationality within a market framework. Firms aim to maximize profits as their primary aim, and they often calculate that short-term profit is more likely to flow from poaching trained workers from other enterprises. It is true that some observers consider ‘poaching’ to be in decline, but none deny that it remains widespread. The dissonance between the interests of a particular industry and the national economy on the one hand, and of individual companies on the other, has been discussed elsewhere.43 Indeed, the entire White Paper seemed redolent of the era of Chancellor of the Exchequer Nigel Lawson’s economic confidence in the aftermath of the 1987 General Election victory rather than of the more realistic period which followed in 1989 and 1990, when it was being implemented. Even as ardent an apologist for the free market as Sir Keith Joseph admitted in 1990 that industrial training was an area where his favoured theory was not being vindicated.44 ‘The proof of the pudding was to be in the eating’, however, and the issue is best resolved empirically since the TECs can best be evaluated on their performance rather than on the basis of theoretical considerations. And here the judgement must be over a longer time-scale than is possible in this work. The next section examines the evidence of the three years which followed the White Paper’s publication up to the end of 1991. THE ESTABLISHMENT OF THE TECs: AMBIGUOUS EVIDENCE Launching the TEC’s prospectus, the Secretary of State Norman Fowler described them as offering employers, in partnership with the wider community, ‘an unprecedented opportunity to reskill the workforce and stimulate business growth’.45 His intention was to set up, over a three- to four-year period, a network of eighty employer-led TECs responsible for £3 billion of public expenditure and for 5,000 staff. TECs were to operate such training and business programmes as YTS, ET, BGT, EAS and Small Firms Counselling. Yet TECs were also to adopt a more proactive local role involving the assessment of local economic and social needs and the directing of resources accordingly. TECs would also promote training as a business strategy, ‘as a serious investment rather than a discretionary cost’, and operate as independent companies with performance contracts with government. The government was confident about a bottom-upwards approach to both employment creation and human development. As another DE document of the time expressed it: ‘people are the business. Lack of skills . . . distort the pay structure; raise labour costs; [and businesses become] . . . less flexible;

148

The politics of the training market

easier prey for takeovers; and less ready for 1992’. TECs were to be a catalyst for change in mobilizing public and private resources to strengthen the local skills base, and would be agents for change. The government continued to acknowledge its responsibility by utilizing the TA to promote training and to help business to succeed, but its chief concern was to ‘hand over the reins locally to key business leaders’. Innovation through diversity and decentralization was the key to the strategy. The DE recognized the need to increase the training effort occurring in the small and medium-sized business sector, a sector generally understood as comprising companies with under 500 employees. TECs were intended to help companies to start up the process of upgrading and reskilling the workforce, as well as to provide advice to medium-sized firms about the kind of training required, and how it was to be conducted and financed. There was also encouragement to TECs to engage in business counselling. Groups of employers would seek NTTF approval on the basis of their business plans, which would outline the measurable objectives which they set themselves. They would secure approval provided they demonstrated their capacity to manage budgets at an average rate of £20 million, and they subcontracted the delivery of training and enterprise support services through colleges, companies and employer organizations, enterprise agencies, local authorities and voluntary organizations. They should offer both competitive tendering and contractor performance evaluation. The business plans should deal with a three-year period, but by presenting annual budgets. They should also define the TEC’s own particular local vision, set strategic objectives, describe the economic and social characteristics of the area in the context of national and international skill trends, identify training and enterprise priorities and outline the type of organization required to achieve the objectives it set for itself. TECs should demonstrate their capacity to oversee a large delivery system with budgets averaging £20m. ‘In most instances, it will not operate programmes directly but will contract for training and enterprise support service through providers’.46 Yet there was no pretence of financial autonomy, since TECs were to be offered a mere £0.25m. for their local initiative funds. And while the DE was prepared to match funds raised from employers up to a value of £0.125m., the lack of local flexibility was evident. Perhaps the later protests of TEC chairmen and boards that they were denied the freedom that they sought were less than convincing, in that the DE had made it plain from the outset that it wanted to earmark most of its direct funding. There was one area of potential autonomy, however, since TECs were permitted to establish a subsidiary company to engage in activities beyond the scope of those funded by the TA. Yet it is noteworthy that such activities were

The rise of TECs

149

not to be supported by public monies. Clearly the DE considered that they would provide less value for money than the sums invested in its own schemes. There were safeguards against employers exploiting their TEC board membership by diverting contracts in directions in which they had a potential interest. It was specified in the official TEC prospectus that board members were accountable for their performance, that there could be no block votes nor shares by individuals and organizations, and ‘each Director will have to declare to the Board any interest in any organisation . . . related to the TECs affairs and any other potential conflict of interest’.47 The rhetoric in the prospectus was indeed encouraging, but in proposing ‘a new partnership between government, business and the wider community’ it failed to acknowledge that government intended to circumscribe TEC autonomy by tied funding for the fulfilment of its own schemes, while abdicating responsibility to set and monitor national standards for the expansion of training. It soon became apparent that TEC directors sought more support and less direction from the DE, and that the financial cutbacks to TECs for youth training were not compensated by the minor concessions in the budget of March 1990. The Chancellor of the Exchequer John Major announced that individuals and companies would be able to deduct as an expense for taxation purposes any contributions towards the funding of TECs. Michael Howard considered this to be an important concession.48 Yet the director of the Industrial Society, Mr Alastair Graham, said Mr Major had missed an opportunity to take more effective action to tackle Britain’s worrying problem of skills shortages.49 In May 1990 the chairman of the eighty-two TECs decided to nominate representatives to a new formal working party to lobby the government over such matters as funding and independence. Ready to assume a new and more useful role than the chairmanship of the aborted NTTF, Bryan Woolfson agreed to chair the new group. Funding was clearly an important issue, particularly as the government announced a cut in the budget from £2.9 billion to £2.5 billion in the first year of operation. Wolfson said that ‘all the TECs felt that there needed to be a mechanism for conducting a regular dialogue with government over a range of issues including budgets, flexibilities and contractual matters’.50 The new Employment Secretary expressed his readiness to co-operate with an organization through which his department could work with the TECs. As a result it was agreed to set up a lobby group made up of nine regional representatives. This was to replace a smaller ad hoc group which TEC chairmen had demanded be set up when they had met Timothy Eggar, the junior Employment Minister, to agree to the signing of contracts. Despite their disappointment about cuts

150

The politics of the training market

in the total budget, the TECs had a more subtle anxiety. This was that the contracts which they were asked to sign were too restrictive in their requirements, and that funds were tied too tightly to government objectives. Government neglected the fact that employers did not merely seek majority control so as to escape the effective interventions of trade unionists and local councillors in the affairs of TECs, but that they also sought to be independent of government directives. This involved their independent capacity to promote locally tailored and responsive training and enterprise measures. Yet the government, while sympathetic in principle, regarded such developments as self-financing, and wished to see its own resources distributed to achieve specific political purposes. Evidently, in the areas of YTS, ET and the Enterprise Allowance Scheme (EAS) their main motive was to massage the unemployment figures so as to take the ‘heat’ out of the issue electorally. Any impact on the national and local training effort was by way of a bonus. Employment Action (EA) in the summer of 1991 reawoke the controversy. Some of the confusions about the precise powers of TECs must lie at the door of the TEC board members themselves, however, since it had long been apparent that all governments, and particularly Margaret Thatcher’s, only funded bodies to carry out their own objectives. This had been a common complaint of the National Council of Voluntary Organizations (NCVO) since the early 1980s, and even underpinned the decision of the National Council of Labour Colleges (NCLC) to refuse state funds at the beginning of the twentieth century.51 It is also evident that the Treasury is notoriously concerned to safeguard public expenditure, and has long exercised a vigilant control. Its power had been criticized as early as the 1960s, but by the 1980s its capacity was the greater. Sir Peter Middleton, who was appointed as Permanent Secretary to the Treasury in 1983, referred to the constant public spending battle between the Treasury and the rest of Whitehall.52 ‘No matter what economic theories prevail, or what government is in power, the control of public expenditure remains the Treasury’s unalterable function’.53 It will always have a bias against an increase. This process of control has particularly intensified with the introduction of financial management information (FMI).54 This has involved a more direct intervention in the affairs of individual departments. TEC boards must have been disingenuous in expressing surprise at the government’s reluctance to give them freedom with public funds. While the attempt at rational long-term planning of public expenditure which was inaugurated in 1961 has now ceased, the introduction of cash limits in 1976 and the return to an annual planning cycle in 1981 has involved tight managerial control over the disbursement of public funds.55 Non-Treasury Civil Servants have also objected bitterly to ‘the assinine annuality system’

The rise of TECs

151

because of its detrimental effects on good planning. While the strength of the Treasury must not be overestimated, and prime ministers have overruled them repeatedly – for example, Macmillan over monetarism in 1957 and Thatcher over EMS entry in 1989 – there is little doubt that Thatcher upheld Treasury attempts to be draconian, in her effort to reduce the proportion of public expenditure as a share of total gross national product (GNP). ‘The Treasury’s major objective has been the control of public expenditure through a rigorous regime of cash planning and cash limits’.56 It is unclear why the leading businessmen on the TEC boards expected the Treasury to relinquish its practice of tight control and the management of objectives for the provision of public services. In other settings they would applaud such rigour and prudence with public money. The main reason why the limited autonomy granted to the TECs should have occasioned little surprise is that they were a product of the movement towards the establishment of special agencies under the impetus of the government’s own Efficiency Unit report of 1987. This involved a restructuring of the Civil Service in order to separate service delivery, which was to be carried out by agencies operating according to business principles, from policy formation. The TECs were intended to operate within the disciplines of business management, but despite their partial rootedness in the American PICs they were compatible with the government’s service delivery ethos. While the government was insensitive in not realizing that managing directors and chief executives of successful companies would lose interest in bodies enjoying very limited discretion, TEC chairmen and members must have been aware of the deal that was being offered when they first involved themselves. Perhaps they were revealing great political skill in accepting involvement, only as a precursor to flexing their own muscles at the time when the government would require their co-operation. The degree of local control over budgets and programmes which the TECs succeed in obtaining in the early 1990s will demonstrate how far the TEC board members can exercise their political resources to achieve their goals. The auguries do not appear propitious for the aspirations of the TEC leaders, however, for while the total privatization of TECs would give them the freedom that they seek, the government is unlikely to concede that principle when it is still anxious to continue with measures to reduce the unemployment statistics. Equally, the TECs themselves do not favour complete privatization while they require substantial funding to fulfil their own strategic objectives. TECs were ideal from the government’s standpoint in that they managed to change the balance between the public and private sector and to give employers the lead role in a limited company, with the state retaining ultimate policy control through departmental contractual

152

The politics of the training market

mechanisms and the annual system of parliamentary financing of agencies.57 The Treasury’s Permanent Secretary, Sir Peter Middleton, has expressed the view that agencies have the support of the Treasury because they are conceived as being compatible with savings, controls, improved budgetary systems and performance indicators.58 There are also grounds to argue that the government is moved more by an ideological animus against organized labour and the Civil Service, the latter motivated by the ‘new right’ and ‘public choice’ theory conceptions of self-serving bureaucracies, than it is by any urge to create newly powerful TECs. Just as the polytechnics were removed from the LEA sector in the 1988 Education Act while remaining subject to systematic national financial control through the arcane methods of the Polytechnics and Colleges Funding Council (PCFC), so the TECs were freed of trade union and LEA domination rather than accorded genuine independence. The TECs are best understood as a part of the project which had earlier involved the setting up of enterprise zones and urban development corporations. The purpose of the project is to demonstrate the limitations of the capacity of the local state, to encourage a belief in business and market-orientated solutions, and to attack the Labour Party’s local political base.59 The government revealed little sign of wishing to expand the contribution from the public purse towards the promotion of the training effort, but consistently with a market approach it argued that industry should spend more. Yet government stood accused ‘of sending the wrong signals by sharply cutting its own spending just as TECs were trying to mobilise support’.60 It did this in 1990 by cutting the real budget for youth training by 45 per cent, which it justified by demographic change and the resulting tightening of the youth labour market. The government’s desire to set up agencies such as TECs in preference to continuing with the TA was fuelled by its displeasure with the Civil Service. This displeasure was partly legitimized by the report of the Efficiency Unit in 1987. The report rejected the idea that such management techniques as FMI could be grafted on to a large Civil Service machine. This had been the government’s approach since the early 1980s.61 The Efficiency Unit’s report, The Next Steps, recommended the bifurcation of the Civil Service into a small core of policy-makers, and a much larger number of agencies charged with delivering particular services. One distinguished political scientist, Patrick Dunleavy, regards TECs as an early example of the report’s actual implementation when he refers to ‘the breaking up of the detached parts of the department of employment into local Training Education Councils [sic]’.62 He justifies his view by the report’s clear judgement that the agencies could be partly or entirely in the private sector. In fact, the public money and the Crown status of the officials

The rise of TECs

153

in the TECs makes them very much quangos (quasi-autonomous nongovernmental organizations) rather than private-sector bodies. Yet consistent with the report and with the government’s ‘new right’ assumptions, the TECs involved the decentralization of government services, the seeking out of results through performance indicators, and a more enterprising structure – to avoid the pitfalls of overcentralized rule-boundedness and the resulting incapacity to respond to new demands. The Efficiency Unit’s report justified the splitting of responsibilities in this manner, by arguing that senior Civil Servants could then focus upon what should properly concern them, which was the control of expenditure and resources.63 Advocates of TECs referred to the improved performance resulting from pseudo-privatization. There are few signs that the control of public expenditure is shortly to be weakened, despite the protests of the TEC’s lobby group. On the contrary, Sir Robin Butler, the Cabinet Secretary stresses that delegation to the new agencies ‘should not weaken overall controls to public expenditure which are necessary for macro-economic purposes’. Margaret Thatcher’s inclinations were also made clear in parliament when she announced the government’s acceptance of the Efficiency Unit report. While the agencies would be run by their chief executives it was to be ‘within policy and resource frameworks agreed with the responsible ministers’.64 While the TEC chairmen strove to acquire an exceptional degree of autonomy and argued that the organizations must not be stifled by bureaucratic regulation, a claim which many of them supported by threats of resignation, they must be aware of two further considerations. First, do they really want the full loss of public funding implicit in entire privatization? Second, since most of the new agencies will wish to achieve greater flexibility to escape from annuality and to raise their own independent capital without close National Audit Office scrutiny, the Treasury will resist making an exception of TECs for fear of the precedent that it would create for all the other agencies. Certain comparisons with the structural position of the former MSC are important. First, the creation of the TECs was relatively easy, and thus incrementalist theories of the policy process remain sustainable. This is because the work of the MSC and its successor bodies ensured that the organizational tasks and client groups were already clearly defined, and its services were being run in a semi-independent manner within the DE. Any apparently radical element in the TEC and other agency reorganizations is also mitigated because it will take time to resolve the battle between the agencies seeking independence and the Treasury fighting to maintain centralized limitations on budgets and personnel. The precise relations between the Treasury, Whitehall and the agencies are far from determined.

154

The politics of the training market

While the TECs are patently less centralized than the MSC they are also, and this was apparent to their leaders by May 1990, less independent. They are less centralized because instead of providing a single instrument for policy implementation they, together with a group of Scottish local agencies (local enterprise councils), comprise 100 local organizations. Their independence is more circumscribed, however, because, as Flynn points out, the MSC: functioned with a Corporate Plan and a system of performance measures for its various tasks and objectives. It was, of course, more independent than the current range of agencies, being responsible initially to a Commission rather than direct to a Minister’.65 Although Flynn was unduly influenced by the formal position of the MSC and a more realistic analysis of its role would have revealed that it too became increasingly subject to DE control, it is true that it enjoyed greater power than the TECs, unless the lobby group wins its struggle. The MSC enjoyed the resource, not available to the TECs, of substantial size and a large budget. The comparison with the MSC serves to illustrate the range of possible structures available to governments seeking to decentralize the delivery of services. It is ironic that the Employment Service which was removed from the control of the MSC in 1987, and which might have appeared a particularly suitable candidate for early transition to agency status, remained within the DE long after TECs had been set up. The reasons for the delay are instructive. Given that it employs 40,000 staff and is a large operation, its transition to agency status was delayed because of intragovernmental disagreements about the feasibility of exercising adequate financial control.66 Clearly the Next Steps reforms were never aimed at creating organizational autonomy. Some TEC leaders have been particularly critical. The Chairman of the South-East London TEC, David Wells, openly expressed his dissatisfaction with the role which the DE expected the TECs to perform. As early as July 1990, he pointed out that 90 per cent of TEC funds were earmarked for government schemes focused on the unemployed, and that these standard programmes are unsuitable for addressing the problems of Britain’s skills shortage and corresponding international under-competitiveness. Even the scale of income for particular TECs, he complained, is decided by the number of registered unemployed in the geographical area concerned. Wells, who is chairman of British Gas, argued that the TECs were failing to acquire the status and funding necessary to engage the involvement of businessmen. This discovery was based upon correspondence which he conducted with employers in his area to question their commitment to taking part in training and enterprise activities. Only 1.2 per cent bothered

The rise of TECs

155

to respond. Nor did Wells criticize the non-respondents, since he considered that the fault lay in the system. Pointing to the importance of converting small businessmen to the need for training their workforce, he recognized that the 90 per cent of the firms in his TEC area which employed fewer than twenty-five workers could not be expected to fund expensive training initiatives. He called for larger budgets for TECs as well as greater flexibility in their expenditure, in accordance with the particular needs of their areas. Pointing to the rationality of employers poaching workers trained by other firms under the existing system, he advocated the ultimate ideological heresy of the reintroduction of a levy system upon firms according to their size.67 Yet there is a further hidden agenda underpinning the creation of the TECs than merely the more efficient decentralization of delivery in the interest of efficiency and central control to ensure cost-effectiveness. The reform of training was not entirely driven by imperatives immanently related to training policy, as it was also related to the overall strategy of the government. While the government has been consistent in its strategic desire to create an ‘enterprise culture’ in Britain, this philosophy has been prosecuted by clearly distinct ideological periods. From 1979 to 1982 monetarism prevailed. As that was increasingly jettisoned, the period from 1983 to 1987 was predominantly one of privatization, and a supply-side strategy, which included deregulating the labour movement, and promoting skills training. Since 1987 the government became committed to governmental re-organization and institutional tinkering in a manner almost redolent of Edward Heath. The clear purpose in this ideological phase was to go through state, and particularly welfare-state institutions, with a ‘marketizing’ strategy. Training and enterprise ranked alongside the Health Service and the legal profession in experiencing institutional change. A related purpose underpinning the TECs is that of transferring most VET costs from the Treasury to the employers. This was a long-standing aspiration, and it had been evident with such MSC initiatives as the 1985 National Awareness Campaign. It reflects a concealed movement away from an essential principle of the post-war welfare state that services are free at the point of delivery, to the notion that training is a commodity to be purchased like any other on the open market. Despite this largely hidden agenda, however, incrementalist continuities remain striking. First, despite the apparently radical institutional reform there is no evidence that Britain’s long-standing training deficiencies are being addressed. Also the Labour Party does not appear to have any real problems with the TECs, since it intends to retain them while increasing the representation for LEAs and trade unionists on their boards. Certainly, Labour intends to add a national training strategy together with target-setting by a new public organization: Skills UK. This body would share with TECs the

156

The politics of the training market

promotion of a training culture and collect labour-market information. But, behaving incrementally, Labour concurred in July 1990 that: training is best delivered locally. In England and Wales we will reform the training and enterprise councils to make them effective, representative and accountable. They will draw up local training programmes which will be co-ordinated at local and national level. They must do far more than run government schemes’.68 While this proposal represents some improvement to the government’s policy, it largely coincides with what the employers on the TEC lobby group demand. It does not portend a socialist approach to training issues. Recently retired Civil Servants make similar incrementalist comments on public policymaking under Thatcher. Sir Douglas Wass observes that: for the most part potential change is discussed in marginal terms and not in revolutionary terms. It would be rare for any department to wake up one morning and say to itself ‘we’ve been following the completely wrong policy, let us about turn and do something quite different’. If, at any time, that were to arise, it would arise in a very evolutionary way. There would be a gradual perception that things weren’t happening as it was expected or hoped that they would happen. We would look at why that had happened, discussing it as an ongoing business among ourselves and with Ministers, and there would be a gradual evolution towards perhaps some change’.69 This process might describe the gradual dawning that employers were not responding to the promptings of the MSC to invest sufficiently in training, and then to an ‘appreciative incrementalist’ understanding that some different approach to achieving an already existing goal should be attempted. Wass in the 1980s thus echoed Vickers in the 1950s.70 The theory of the ‘market’ in training and enterprise also implied the substitution of market accountability for democratic and electoral scrutiny. It may be that decentralizing the delivery of such services to the market can lead to improved provision, that this efficiency can be further upheld by a process of control achieved through FMI systems and by the TECs allocating contracts on a tendering and performance basis. Yet this too comprises a hidden agenda which elevates efficiency above democracy, and stresses the value of markets and clients rather than the admittedly elusive ‘public good’. Some TEC officials and Board members are perfectly open in the comment that TECs are to be preferred because democracy is not always the best way of obtaining results.71 Yet the discipline of the market cannot ensure public scrutiny, openness to pressure groups and democratic equity. While services

The rise of TECs

157

which were previously in complete public-sector control may be improved by the managerialism involved in the operation of the TECs, there is need for both political as well as managerial accountability and control.72 It is, therefore, desirable to separate political accountability from mere ‘in-house’ appraisal for carrying out agreed tasks according to established performance criteria.73 When the Thatcher government cites the Swedish case to justify the introduction of similar agencies in Britain, it fails to mention that the entire framework of administrative law is different in Sweden – with a Freedom of Information Act and other forms of individual safeguards against maladministration. The government’s values are evident but it is possible to argue that economic efficiency and wealth creation are not the only values which matter. Groups who are socially marginalized or in poverty are not likely to benefit directly from programmes aimed at greater private-sector profitability.74 It can also be doubted whether the notion of setting strategic objectives at the centre, supported by lower-level plans and targets is appropriate in the political and public sectors, where rational and orderly behaviour is not always possible. As the editor of Public Administration expressed it: ‘the pressure on politicians makes it advisable for them to specify objectives in the grandest of priorities and the vaguest possible terms. Many policies are thus essentially unfalsifiable’.75 The first TEC to be formally approved was that of Calderdale and Kirklees in West Yorkshire. It was one often to be signed up in the summer of 1990, but was first in the queue. While TECs vary according to locality, there are common concerns which unite them all, which a case study can help to illuminate. An analysis of its formation and early development is therefore of some help in judging the establishment and early performance of these fascinating, experimental but flawed organizations. THE CALDERDALE AND KIRKLEES TEC: A CASE STUDY On 3 April 1990 the Calderdale and Kirklees Training and Enterprise Council was established, and it was the first in the country.76 Commentators had predicted that Sheffield and Birmingham would be the first areas to secure TEC status.77 It appears that an excess of democratic discussion held back their development, however, and that the local elite group which provided the impetus behind the Calderdale and Kirklees TEC was better able to agree on a set of strategic objectives and to present a credible case within the laiddown guidelines.78 The group members who came together to establish the TEC were well known to each other and formed a local business community elite. While many of the members had developed business interests which took them out

158

The politics of the training market

of the area, the majority (like the first chairman Tony Gartland) were people well rooted in the locality. Naturally, the charges of ‘cliquishness’ and ‘clubbiness’ can be brought against the participants, but they achieved results. Further, the calibre of the individuals themselves left no doubt but that some of the main business leaders in the area had been recruited. Nor were they a group brought together mainly through local social elite interactions (for example, the chambers of commerce, the rotary club or the golf clubs). If anything they were a group which had already worked as an existing network on such bodies as the Calderdale Partnership Group, and to a lesser extent in Kirklees on the Huddersfield 2000 Group. The Kirklees group was relatively informal, but the Calderdale Partnership brought business leaders into a formal relationship with the local authority and achieved a great many tangible local benefits. These included the re-siting of the Halifax bus station, the restoration of the Piece Hall and the Eureka project to bring the National Children’s Museum to Halifax. Given this established institutional co-operation and the presence of such entrepreneurial figures as Ernest Hall, who had converted the Dean Clough complex of buildings in Halifax into premises suitable for the development of a range of small businesses and co-operatives, it is clear why this part of the country was in the vanguard of the TEC movement. The network of interested employers set about discussions and negotiations with local TA staff, and after some argument about geographical boundaries, there was agreement that Tony Gartland the Chief Executive of Gartland and Whalley Securities become the chairman, and the members decided to prepare their business plan rapidly in order to gain NTTF approval. The issue of boundaries was not without substance since there was a long tradition of isolation between the two communities of Huddersfield and Halifax, in part a product of an intervening hill. This has been discussed in another context, and was even an issue at the time of local government reorganization in 1974. An earlier recommendation to combine the two towns within a single authority was rejected on the grounds of incompatibility. As a result, Calderdale was the smallest and Kirklees one of the smallest of the authorities set up in 1974.79 Presumably the TA suggested the Kirklees and Calderdale marriage as the most appropriate, and there must have been some DE and TA preconception of how West Yorkshire was to be divided up for the purpose of TECs. Given the tradition of parochialism, the TEC board sensibly decided that it would be desirable to appoint two separate local advisory groups for Kirklees and Calderdale. There were some conflicts in the establishment of the TEC board of directors. One local council leader, for example, adamantly urged that elected members rather than officials should acquire membership of the board of directors, but as this was not thought conducive to securing

The rise of TECs

159

early approval he was defeated. Other political figures questioned the credentials of individual employers on the grounds that their firms were perceived as conservative in their managerial methods. These objections were also overcome. It was the established elite networks, therefore, which led to the rapid acquisition of development funding and subsequently full TEC status, but this was further facilitated by the existence of a common belief among members that their main motive in participating was in order to build a better community. The promotion of training, enterprise and business values was a means towards the end of creating a wealthy and flourishing area which could then promote such community values as a vibrant arts scene and high quality social services. It was the spontaneity of this process of institutional development which led to rapid progress, and the common concern for the quality of life of an entire area promoted effective co-operation.80 The auguries for certain other TECs where these characteristics are absent, or are externally superimposed from the TA, are much less favourable. Partly as a reflection of the existing consensus, and partly as a conscious compensation for the ‘brutal’ way in which other interests had lost their influence after the ending of tripartism in training, the board of directors included representatives from both trade unions and local authorities. It is true that the trade union involved was the Union of Construction, Allied Trades and Technicians (UCATT) which had long collaborated locally and nationally with both YTS and ET; and both Kirklees and Calderdale were moderate Labour councils which were accustomed to partnership arrangements with private-sector organizations. But the inclusion of participating groups was, therefore, highly controlled. Such an exclusion process is hardly surprising. The preconditions which public-policy theorists lay down for the achievement of a policy community can usefully be applied to policy or issue networks. As Rod Rhodes expresses it, there is a need for ‘a degree of consensus on policy values’.81 Or as Laffin puts it, ‘policy communities have a cognitive order which means that they are characterized by agreement on what constitutes relevant and accepted knowledge’.82 There is a danger, however, that the degree of consensus which properly brought the participating groups together in the Calderdale and Kirklees TEC might lead to an exclusiveness in the future, not so much through an agreed agenda but through the self-perpetuating nature of the established institutions of policy-making. There is a further obvious pitfall for both trade unions and local government in these institutional arrangements. Their inclusion within the local training sub-government incorporates their organizations, at the same time as it permanently entrenches their minority status in the policymaking process. In any event, the board’s membership was drawn from ten local businesses, plus one trade union and the two local authorities. By

160

The politics of the training market

contrast, the first Calderdale advisory group consisted of five business representatives, two local educators, three local-authority members (including the elected leader of the council), one trade unionist and one clergyman. The Kirklees advisory group comprised five members drawn from business, two private-sector trainers, three educators, and four members of the local authority (including three elected members). The greater presence of educators and other non-employer members on the sub groups is significant, since those groups are only advisory whereas the board possesses executive powers. A local critic also comments on the greater representation of small businesses on the advisory group. He adds that the domination of the main board by big businesses leads the smaller firm to disregard TEC exhortations to invest in training, as they consider that big companies are in very different financial situations. Local press reaction to the new TEC was enthusiastic. The Leeds Journal referred to ‘an idea whose time has come’, and endorsed TEC philosophy that it was the business and other community leaders in West Yorkshire rather than the men in Whitehall who are best equipped to judge and meet the training needs of the area. While sixty-four of the projected eighty-two TECs had secured development funding, Calderdale and Kirklees was in operation.83 The Calder News revealed that: Business and community leaders were brought together just over a year ago as Development Group members for Calderdale and Kirklees TEC. With very little change in membership that group has gone on to become the first board to be established in Yorkshire and Humberside. Development funding was granted in July 1989, and the Board met the target of becoming operational in April. Working through a support unit based in Bradford, the TECs fourteen strong board has appointed a Chief Executive and has set up separate advisory groups for Calderdale and Kirklees, together with marketing and finance committees. It quoted the chairman as saying that the TEC would work to increase the number of people entering further and higher education and training, and encourage a wave of entrepreneurs from all sections of the community. And the newly appointed chief executive, the late Haydn Kershaw, who had served for over four years as the TA’s area manager for Bradford, Calderdale and Kirklees, echoed more of the local TEC’s enterprising philosophy when he was quoted as stating that the most prosperous areas of Britain would be those with the most enterprising individuals who were also able to adapt.84 Before examining the Calderdale and Kirklees TEC’s strategic objectives, and its business and corporate plans, it is possible to gain some flavour of the ethos of this particular TEC. Its emphasis was on enterprise as the

The rise of TECs

161

precursor of training, and on the production of enterprising individuals as the prerequisite of enterprise. There was also a conception that managers should first themselves be properly trained before they could develop training programmes for their companies which would have employee appeal. This theory was undermined when, at a first attempt, during the economic recession of the early 1990s, there were very few local recruits for a senior management course which the TEC launched for £1,600 per head. The board did not match its desire for national training targets with any wish to introduce compulsion through grants and levies. Its concern to promote training and enterprise by means of persuasion and example as a positive good for firms and companies could not sit happily with bureaucratic interventionism and legislative sanctions. So board members, or at least the majority drawn from business, disagreed with Labour and the left over this particular issue. The TEC takes the view that the imposition of levies makes training appear to be a negative activity imposed by threat of penalty rather than as a worthwhile business investment. One board member describes the effect of the ITBs as giving industrial training the connotation of a necessary evil. Training should be promoted by proselytization and winning hearts and minds, which in turn was best achieved by convincing employers that investment in people transformed the ‘bottom-line’ of company accounts. Board members feel that legislative compulsion was a poor substitute. There was a convergence of view between the DE on the one hand and the TEC development group on the other on matters of broad policy, although the TEC clearly wished to place less emphasis upon training and enterprise schemes aimed particularly at the unemployed, and to stress the encouragement of good entrepreneurial attitudes throughout the entire community. Yet all was not harmony in the discussions between ministers and the development group in the period when the contract was being negotiated. The group members were impatient at the incapacity of the relevant junior minister, at that time Timothy Eggar, to commit his department without referring matters elsewhere, and particularly to the TA and the Treasury. Entrepreneurial businessmen are unaccustomed to dealing with mere delegates, and prefer to reach rapid agreements with heads of organizations. There were also a number of specific points of disagreement. First, the TEC wanted a stronger national impetus to set training targets, as Norman Fowler had been willing to do. Funding should be directly related to training targets. Second, and here too they were in line with the views of the other emerging TECs, the group sought much greater flexibility. They were not primarily concerned with the total quantum for funding since that was a wider national issue, and their budget of over £18m. was satisfactory, provided they could exercise greater leverage over its expenditure instead of being

162

The politics of the training market

compelled to direct most of it to unemployed training schemes. Not only was there an important principle involved, and board members did not wish to become unpaid Civil Servants, there was also a fear that the TA would continue to engage in transient schemes, and such ‘quick-fix instantism’ was alien to the TEC’s preferred approach of three uninterrupted years to carry out its corporate plan. Adult training was, for example, of far greater complexity than the mere application of ET allowed. The contract which finally emerged from the process of negotiations between the TEC development group and the TA Civil Servants was widely described by local Board members as ‘horrendous’. The lack of flexibility was particularly irksome. A number of heated meetings were held and it appeared a realistic possibility that the contract could be rejected. Only the aspiration to change the nature of the contract by continued negotiations, the prospects of which were enhanced by the formation of a national representative lobby group of TEC chairmen which became known as the G10 group, persuaded the members of the development group to remain involved. Some members were only prepared to give the experiment six months, however, and the outcome of the November 1990 public expenditure statement was clearly a crucial factor. It was less the size of the total budget which exercised members, although the wrong signals were being given by the cutting of funds to the new youth training scheme, but the lack of flexibility for local initiatives and the provision of locally tailored programmes. As late as October 1991, the Calderdale and Kirklees TEC was still in dispute with the DE over the surpluses which it generated. While it was raising money entrepreneurially through efficiency savings on youth and adult training, it was unable to redirect this towards innovative projects as the DE was adamant that the funds should strengthen the YT scheme. The particular theory which guided the Calderdale/Kirklees TEC was the notion that enterprise is the precursor of training expansion. This is a rather dogmatic judgement about a classic ‘hen and egg’ dispute, but the aim of creating an enterprising local economy and community was obviously laudable. Yet the fact that Calderdale/Kirklees was among the first group of TECs to receive full status demonstrates that a spirit of enterprise already affected some local businesses. The corporate plan was an impressive document which was based upon a substantial amount of local analysis, in which no doubt the local TA was helpful. There is clearly merit in hiring a former TA official as chief executive, both to access the necessary data in a comprehensible fashion, and to benefit from the skills of an official who understands the nature of the training policy community. Haydn Kershaw’s death in the autumn of 1990 was untimely. His successor, Alastair Graham, is an able national figure which promises well. It is ironic, however, that he had been an early critic of the White Paper Employment in the 1990s.

The rise of TECs

163

The corporate plan recognized that the area had suffered substantially from unemployment in the early 1980s as a result of structural change in its major industrial sectors. To avoid a repetition, the TEC aimed to ‘ensure that our human capital is better educated and trained, more flexible, and most of all, better motivated than those against whom we compete’.85 There was a particular concern to break with the TA’s past focus upon training the unemployed, not least because eight out of ten of the local workforce of the year 2000 will be in work in 1990. ET did little to create enterprise or tackle the problem of skill shortages, so it was necessary to develop the notion of a skills ladder through which the entire workforce could upgrade its competences and qualifications. ET was also renamed Adult Training (AT) by the TEC, as part of an attempt to improve the character of adult retraining for the unemployed. The plan also appeared to assist the ‘fence mending’ process, with at least one part of the partnership which had been usurped by the ending of local tripartism with the abolition of the local area manpower boards. This was by exploiting the advantage of having three FE colleges, a polytechnic and local-authority training organizations in the area. The plan was clear about the critical success areas for the TECs activities. First, to encourage local business leaders to invest in people; second, to redesign Youth Training (YT) and Adult Training (AT) so as to abandon the unattractive national brand imaging; and third to prepare the local community for change, and particularly those who may be disadvantaged for reasons of ethnicity, gender or disability. The TEC advanced six major strategic objectives. The first was to ‘encourage the successful development of existing and new business which will contribute to an enterprising, dynamic and competitive local economy’.86 This was to be achieved by improving business counselling, establishing an enterprise support network, assisting new and expanding businesses with product research, promoting training as an integral part of company investment, development and growth packages, and developing more effective targeting of enterprise services to local entrepreneurs. The second strategic objective was ‘to achieve higher volumes and quality of training linked to business plans so that local businesses compete more effectively and profitably in the National and International market place’. This involved encouraging companies to prepare business and training plans, increasing the amount of occupational training in key sectors by partnership agreements setting minimum standards, increasing training in identified skill shortage areas and stressing effective management training, education and development. The third objective was ‘to encourage a wider and more varied range of business and education partnerships in order to enrich educational curricular, enhance educational planning and increase the proportion of the population in

164

The politics of the training market

continuing, further and higher education and training’. This involved links with LEAs and higher education to plan better education and training provision, increasing the availability of higher level courses (NVQ level 3/ 4), widening access to education and training throughout life and improving the educational attainment rates of young people. A fourth objective was ‘to effectively co-ordinate training and enterprise services with economic development activities as a means of promoting the national and international competitiveness of local business’. The fifth strategic objective was ‘to ensure that all local people have a real opportunity, through training to acquire basic, vocational and enterprise skills which equip them to obtain and retain employment in the mainstream economy’. This particularly required an improvement in the participation rates in employment after training for ethnic minorities, the disabled, those with special learning needs and women. The final objective was ‘to improve the quality and use of local labour-market information for policy-making and more effective operation of the training and enterprise systems’. This involved both better information to target training and improved guidance and counselling arrangements.87 The fulfilment of these objectives is to be obtained by means of the TEC quality circle which progresses through market research to planning and specification of training and enterprise services, through contracting and delivering to evaluation and review.88 In line with the government’s philosophy, which was reiterated in the 1988 White Paper, the TEC intended to arrange for the delivery of its programmes by competitive tendering. In tendering for contracts, providers are to be requested to state their proposed inputs to meet their required outputs, their quality management and review arrangements, the competence of their staff, weekly trainee costs, and their methods for meeting the TEC’s equal opportunities and health and safety policies. Payment by results was to be the method of organizing TEC contracts with at least 30 per cent of payments being performance related. The TEC placed particular emphasis upon the importance of networking. This involved building effective channels of communication with business and industry, the local authorities, further and higher education, training bodies, chambers of commerce, government departments and other TECs. This was an impressive document, and its early acceptance by the TA is not surprising. Yet the sheer ambition of its goals when measured against its limited budget for local initiatives suggests a lack of realism. Further, many of the objectives appear to overlap with each other which makes for imprecision, which in turn renders effective evaluation the more difficult. Yet even if its objectives are grandiose, so is the nature of the deficit under which Britain labours in the area of training. The major doubt is whether the TEC will be able to change the ingrained resistance

The rise of TECs

165

of local employers to invest substantially in the training of their workforce. Here the evidence is conflicting, with TEC officials expressing pleasure in autumn 1991 that employers maintained their training budgets during the recession that was then ‘bottoming out’, but others maintaining that, with some major larger employers excepted, little had altered. It is worth noting that the TEC was properly concerned at one sign of government scepticism, when it asserted that: it finds it incongruous that responsibility on behalf of government for Technical and Vocational Initiative (TVEI) and Work Related Further Education (WRFE) remain with the Training Agency and Enterprise in Education with the Department of Trade and Industry. These functions ought to move to the TEC.89 While the Calderdale/Kirklees TEC was in the vanguard of the movement, it did not win support to be one of the TECs to pilot the training credits for young people announced by the Secretary of State in March 1990. It has decided, however, to bid for funds to become one of the second group of TECs to experiment with credits. The officials support the ideology of placing power in the hands of young people themselves, but they were particularly motivated by the prospect of additional funds. Overcoming the political opposition of certain elected councillors it argued that government was determined to proceed, notwithstanding the lack of opportunity properly to evaluate the outcome of the first round. The bid was made in October 1991, and it was prepared by three working groups. These dealt respectively with policy and principles, mechanics and careers guidance, and marketing. Yet it is the funding which flowed from YT which proved to be a major source of contention, as has already been mentioned. There were two main aspects to the problem. First, the DE was adamant that any surpluses generated by the efficiency savings involved in the Calderdale and Kirklees schemes should be redirected to YT itself, so as to enable government guarantees to be carried out. Second, the TEC was unsuccessfully attempting to alter the entrenched practice in British government of annuality, in order that it could sub-contract for three-year periods. Yet it was happy to exercise the flexibility which it was granted, by changing the branding of ET to Adult Training (AT), although it was anxious to concentrate more upon truer localized initiatives. It decided to participate in the government’s short-term Employment Action (EA) programme, unlike a small number of other TECs which refused to do so, on the grounds that EA was ‘small beer’, and that if it refused, then neighbouring TECs would be asked to assume the responsibility.90

166

The politics of the training market

Three main local initiatives must be mentioned. First, there was the new sectoral partnership system to promote training in manufacturing industry, and by October 1991 three had already been formed. They were in the engineering, textiles and construction industries. While the commitment to promoting training in the manufacturing sector was highly commendable, the sectoral focus was somewhat reminiscent of the old industrial training boards. The TEC was particularly committed to the NTTF’s ‘investors in people’ programme. There was a major launch in October 1991, and the TEC was enthusiastic about it because it dovetailed well with the ‘skills ladder’ philosophy which has already been analysed. In preparation for the launch, there was a great deal of publicity rehearsing the familiar arguments that businesses which are investors in people are those which realize that human capital is the vital ingredient in business success. ‘Investors in people’ (IiP) had become essential because of a tough domestic market, rapid technological change, pressure to compete in the wider international market-place and the difficulty of recruiting the right young people with appropriate skills. The TEC was important both in advising firms how to achieve the national standard, and in determining whether the kitemark, then formally awarded by the NTTF, should be granted in individual cases. Among the characteristics required were business plans which showed where the organization was going, the allocation of resources for training needs clearly identified in the business plan and processes to allow managers to agree training and development needs linked to NVQ. The IiP award also looked for the inclusion of the boardroom, managers, supervisors and shopfloor workers in training programmes. TEC propaganda also stressed that IiP would provide firms with a quality image.91 This last enticement is in competition with such other fashionable awards, however, as BS 5750 which is granted for the attainment of total quality management in an organization. The TEC also prided itself in 1991 in the Calderdale record of achievement. By the end of the 1990–1 academic year all school leavers were given a record of achievement setting out a young person’s achievements within and beyond the formal school curriculum. It listed achievements in courses of study, wider personal qualities and the young person played a major part in reviewing his/her own progress in order to agree with the statements made. This assisted employers in recruiting by a more professional method through gaining a better picture of the young person. This initiative was jointly sponsored by the TEC and the Calderdale Education Department.92 Officials of the TEC remained confident about the future of their TEC in late 1991. They acknowledged that the recession had not been a good situation in which to be launched, and that as a result the messages which the TEC conveyed had to be differently tuned. They were similarly confident that

The rise of TECs

167

there were no signs of a dilution in the quality of the membership. Members were still of the chief executive level despite some minor changes, the ‘buzz’ remained and the directors were still steering policy. Awaydays were being arranged to bring professional staff and TEC directors into discussion, and the commercial and Civil Service traditions were being brought together. Directors began to see the merit in tried and tested methods of public administration, while the permanent officials were learning from the businessmen how to become more flexible. Yet the frustrations at the lack of independence accorded to TECs remain. The G10 group was not considered to be particularly effective in defending the TECs against the intrusions of government, and there was support for the idea of creating a new secretariat comprised of TEC chief executives, rather than the chairs who made up the G10. Such a group might make for true relationship changes rather than the marginal adjustments which flowed from the efforts of G10. Yet a less optimistic picture emerges from discussions with other actors who deal with this TEC: for example, educators and representatives of the chambers of commerce. They point to the Calderdale and Kirklees TEC’s failure to abide by the outcomes of competitive tendering. If the process did not yield the results that they desired, then the TEC merely moved the goalposts by arguing down the prices with the applicants. The one-year contracts were also condemned for obstructing effective programmes, and subservience to the DE was complained of in the shifting policies on ET, as unemployment rose and fell, making it difficult for TAs and MAs to retain the appropriate number of staff. There were also suggestions that the TEC was too parochial and that the TEC system had left out the regional dimension. Programmes such as the graduate enterprise programme, for example, could only be dealt with at the regional level because of the small numbers involved. A similar criticism was advanced by the Kirklees and Wakefield chamber of commerce. While the chamber may have been disappointed by the failure of the White Paper proposal for chambers to provide the nucleus for the TEC, it had a valid point that its own boundaries required it to deal with two TECs, and that many firms which straddled TEC boundaries regarded it as worthless to do business with them.93 The Calderdale and Kirklees TEC is well established, and is already producing desirable results. It would be complacent, however, to suggest that all is well or that it has yet passed the real test of changing employer culture and practice. TECs: THE NATIONAL PATTERN This section reviews the early developments in the complex pattern of TECs.

168

The politics of the training market

New TEC initiatives A major advertising campaign to raise awareness of the existence and role of TECs, and to assist in the process of shifting national attitudes to training, was launched in March 1991. The campaign’s objective was designed to: raise the level of awareness of TECs among the business community . . . and to convey their status as the principal catalysts of economic growth in their localities. It will also invite business people to become involved in their local TEC’.94 The campaign highlighted the high calibre of people running TECs and their local focus. The campaign’s symbol was a key which reflected that TECs are the key to unlocking the potential of the people and the businesses in their areas. No evidence has been produced yet as to the campaign’s effectiveness, but the fact that it was attempted demonstrates more about the government’s belief in the saliency of advertising and marketing than it does about the likelihood of a successful outcome to the TEC experiment. Selling a product, at which advertising excels, is a different activity from changing the underlying beliefs and attitudes of a large number of employers, which the TECs must do in order to succeed. The TECs have persevered with YT, as it became on 29 May 1990, as they are compelled to do. There have been reports which reveal that, in the recession, employers have been less willing or able to invest in the scheme. This has undermined some of the benefits which resulted from the greater independence that the TECs enjoy in terms of the delivery of a more flexible programme, particularly with reference to the scheme’s length. While demographic change in some ways improves employment prospects for young people, technological change, together with the development of new materials and processes, still place a premium upon adaptability and skills levels. Clearly there is an inextricable link between YT and training credits, based on the philosophy of self-investment through training. In currently fashionable rhetoric, the Employment Secretary referred to the ‘ownership’ by young people of their own training.95 YT is currently in a process of change, therefore, affected by the new flexibilities which local TECs are free to introduce, the temporarily undermining effect of the recession and the emergence of credits. If the credit scheme becomes universal it is likely to be highly significant in its impact. A number of major questions still need to be answered about how precisely it will operate. As the chairman of the Stockport and High Peak TEC, Tom Weatherby, recognizes, decisions are necessary on whether young people will have a completely open choice of where the credit is placed or whether some suitable bias, perhaps with

The rise of TECs

169

varying amounts, is related to future skill shortages in the particular community which would be linked to the much improved labour-market data. He adds that it remains to be seen whether credits actually motivate young people to demand higher skills.96 The TECs are also attempting to do more to assist the disadvantaged, in line with an equal-opportunities policy, involving the planning and delivering of programmes to members of the ethnic minorities, women, people with disabilities, older workers and ex-offenders. Bryan Nicholson made the appropriate appeal to employer self-interest to get this initiative launched, by emphasizing the need to safeguard against the impact of skills shortages and demographic change.97 Linbert Spencer of the NTTF argued that minority ethnic communities perceive that current training provision is not meeting their needs but those who run training programmes believe that problems are generated by the communities themselves rather than from the training organizations. He stressed that the TECs will have to distinguish between tokenism and real commitment.98 There was also a specific document produced by a working party drawn from key employers, selected TECs, the TA, and the Equal Opportunities Commission. It proposed that the key goals for TECs on women would be to: break down traditional assumptions and prejudices about who does what at work by influencing trainers and employers; take women fully into account in their assessment of the education and labour market; address work and family issues by stimulating family support, particularly through collaborative childcare options and flexible working practices; encourage training and enterprise service providers to improve access for women; stimulate employers to invest in women’s training and employment and develop the skills of women already at work.99 TECs should become leaders in the area, and include women’s training as a regular item on TEC board meetings and develop local awards for employers who innovate in the equal opportunities area. According to the magazine TEC Director, there are many signs of individual TECs developing particular initiatives, as it was intended that they should, in the light of the needs of their own area. Most TECs are conducting research into their own local labour markets, and in the early 1990s this has taken a specifically demographic form. As the TECs began to go live, some of the ideas which emerged included: in Hertfordshire, financial advice to small companies to establish company-based training schemes; in Thames Valley, traineeships to increase the numbers of young people getting jobs with training; in Devon and Cornwall, a system of training audits to help firms assess the costs and benefits of existing or altered training arrangements;

170

The politics of the training market

in Tyneside, two inner-city development compacts to overcome acute skills shortages in the printing industry, plus a Tyneside record of achievement for young people; in Wearside, an education business board to enhance cohesion in the education/training scene; in Teeside, a management development project concentrating on the needs of women; in Somerset, investment in managers; and in Essex, competence-based skill training in educational establishments. It is also an encouraging sign that local TECs are paying attention to the particular characteristics of their own local economies. Indeed, were they not to frame their training and enterprise policies in the light of such evidence, their whole raison d’être would be undermined. The central and south Cambridgeshire TEC provides a good example. Owing to the general prosperity of the area it does not define itself as having a list of priorities demanding instant attention. The main problem is to manage and sustain success. The two earliest initiatives reflected the low priority which emergency measures require, since they involved collaboration with Cambridge University and Anglia Higher Education Institute to set up customized training courses. It was also concentrating upon helping small businesses to grow.100 The Kent TEC is primarily engaged in ensuring that the Channel Tunnel does not have a detrimental impact upon the local economy. It is concerned that the subsequent inward investment might have the effect of developing merely warehousing and storage capacity, and so is determined to develop science and industry parks, and preserve a mix of engineering and agriculture and to ensure that the skills exist for that purpose.101 TEC–state relationships: an unresolved dilemma The problems of relationships between the TECs and the government are fascinating. The government had become so committed to the idea of a small core of professional Civil Servants engaged in policy-formulation, and a far larger group of agency employees engaged in policy-implementation, that it was always likely that training policy-implementation would be hived off into either an Ibbs type agency, or, as happened, a semi-privatized company working under contract from the state. The particular form of TECs resulted from the demise of lingering tripartism in the old TC and the example of the American PICs. Government ministers were fully seized of the danger of granting inadequate powers to TECs so that the TEC boards would fail to attract the top managers, or would soon lose them – as happened with the PICs. Yet it is also evident that the desire to control public expenditure and to determine the broad outlines of labour-market policy, coupled with the very necessary need for annual parliamentary scrutiny and control ensured that the eighty-two individual TECs would never be allowed to float free. Instead

The rise of TECs

171

they were placed under strict contracting arrangements. This has led to some difficulties in the negotiations between the TECs and the DE, and to subsequent complaints by TEC board members that they lack the budget and the powers to tackle real local enterprise, training and economic development needs. The Prime Minister was compelled to recognize this when he told TEC chairs that: ‘I understand your frustrations over the constraints and controls of government’.102 Some of these issues were openly aired at the first TEC conference held in October 1990. The conference dealt with relationship problems, including the issue of TEC/LEA contacts. The Secretary of State for Education and Science, John MacGregor, urged TECs to build links with the LEAs because the government wished to draw education and employment policies more closely together at the national level. TECs should work with schools in the implementation of the national curriculum. MacGregor also praised the training-credit experiment for young people, clearly perceiving that the school and the careers service would be more active in advising young people on their use of the credits, than the employers or the TECs.103 The fact that MacGregor was attending the conference, together with a whole group of other employment and industry ministers, demonstrates that the government retained a great deal of commitment to TECs. Michael Howard, the Secretary of State for Employment, affirmed his optimism about TECs. He praised their performance to date, and promised them the resources to discharge their duties. Significantly, however, he warned that ‘safeguarding tax payers’ money has to be our foremost concern’. While he promised to reduce the amount of data collection which the DE would require of the TECs, he pointed out that ‘a performance based system to which we all want to move, does require high quality and up-to-date information’.104 Discussing flexibility, or local delegated powers, Howard said that: ‘if by flexibility you mean the freedom to make wholesale shifts between funding blocks, the answer is quite simply that you don’t have it and I can’t give it to you’. The Secretary of State emphasized two main concerns. First, the need to increase the quantity and quality of investment in Britain’s future workforce, beyond the £20 billion spent each year on employee training and development. Second, he stressed the importance of the Investors in People (IiP) campaign to be run by the NTTF working with TECs. Investors in People involved a kite-mark for firms engaging in a satisfactory quantity and quality of training. The Secretary of State clearly signalled his sympathy for training credits, and he singled out for praise Birmingham TEC for using credits for unemployed adults, Calderdale and Kirklees for using credit and counselling vouchers for Enterprise Allowance Scheme participants and south-east Cheshire for exploring a credit account system for low-wage unskilled workers.105 He also wanted to engage TECs

172

The politics of the training market

more fully in the development of career development loans. Yet Howard admitted that there were stresses, strains and difficulties in the relationships between TECs and government. Investors in People loomed large at this conference, almost as if it was perceived as a diversion from the TEC-DE conflicts. Sir Brian Wolfson, as chairman of the NTTF, and David Gwyther, of the Somerset TEC, outlined the scheme’s operation. They urged that TEC board members first ensure that their own company merited the award so as to enable them to lead from the front. Revealingly, they also argued that major national firms were reluctant to deal with eighty-two individual TECs and so it was necessary to use the national mechanism provided by the NTTF. This reflected one of the TEC’s weaknesses in attempting to defend and enhance their role, since firms and national industrial organizations were complaining of the cumbersomeness of having to deal with a proliferation of local bodies. Sir Geoffrey Holland’s contribution described TECs as both the Establishment and the revolutionaries. TECs were engaged in managing change. He admitted the politics of the situation, and said that the period ahead would be difficult: as we learn to live with each other and forge our partnership. Government money will certainly be tight, all kinds of people may be trying to divide us, or to prevent us from forging that fruitful partnership we must have . . And in what will be an increasingly political scene as we move towards the next election there will be comment and counter comment.106 Holland’s conception of the TECs is that they are linkage systems and network builders. He mentioned the wealth of training organizations and providers with 5,000 secondary schools, 600 FE colleges, 46 universities, 32 polytechnics, a private training sector and firms’ own centres. He added that: TECs and ourselves are not about bringing into existence a whole new range of providers, still less ensuring the continued existence of any provider whose offerings are no longer relevant or not value for money. Our task is to mobilize provision to effect linkages and partnerships and to bring customers and providers together. TECs should also mobilize the professional resources available in local communities, including their own staff of about 4,800, the Small Firms Service, the Employment Service, the Careers Service and many more. He

The rise of TECs

173

added that: ‘if the TEC revolution is to succeed, then those professionals must march with us . . . as a professional, competent and coherent force’.107 The similarity between the PIC experience and the problems confronting TECs was outlined by an American businessman with direct experience, Bill Kolberg. He urged that TECs should aim for a broader focus than the PICs who ‘have been working on the margin of the labour market, we have never been working in the centre of the labour market’. He also asserted that the TECs were better funded than the PICs and that it was right that this should happen. Yet he encapsulated the dilemma well, and it seems likely that Norman Fowler and others did not take aspects of the American experience sufficiently to heart. Kolberg said: already the strain will be with you, between public funds and accountability on the one side, and your wish and need and fierce desire for the flexibility and independence to do it the way you know how to do it best . . . The only thing I would say to you as business people is always keep in mind that you are spending tax payers’ funds. Tax payers have . . . ways of watching those of us in business when we carry out a public responsibility. We have the General Accounting Office and Inspector Generals and all kinds of auditors, and I would be surprised if you didn’t have the same thing here . . . It is in the nature of the human condition that you will be audited for your performance, and particularly accounting for public tax funds . . . it just goes with the territory.108 If the TECs had any illusions on these matters in October 1990 then they would have been dispelled by the TEC Operating Agreement which they subsequently had to sign for the Secretary of State for Employment. It ran to nearly forty pages, and described TECs as independent companies required to produce corporte plans and business plans in accordance with the Secretary of State’s guidance. It described the obligations of the TECs on a plethora of such matters as their status, the requirement that they provide detailed information, the funding of YT and ET and much more. They also required the TECs to produce annual reports on local labour-market information in consultation with the Secretary of State. Any covert flexibility or opportunity to ‘launder’ money by the TECs was controlled by a detailed list of definitions of terms, and by regulations, as well as by the requirement that the contract be amended through negotiation before the TECs could change any matters of substance. This is not to argue that the TECs should be free to escape such bureaucratic restraints, but to point out that they are inextricably bound into systems of public control and accountability, and as recipients of public money were unable to behave as a private commercial company. It follows that

174

The politics of the training market

TECs need a mixture of civil and public servants and people with commercial experience and business skills. The operating agreements demonstrate the centrality of YT and ET in the concern of the government, although it is evident that the TECs wished to concentrate upon upgrading the skills of the employed workforce rather than ministering to the needs of the unemployed. In private conversations it sometimes appeared as if TEC officials felt a vested interest in proclaiming the failure of ET. Until unemployment began to rise sharply during 1991 and the government became concerned about the electoral fall-out, it almost appeared as if the DE and the TECs were forging a new consensus about the need to focus training on the employed, and that the unemployed benefited more from participation in Jobclubs than in ‘schemes’. Certainly, a concentration on the development of the employed workforce is justifiable. Theories such as the ‘skills-ladder’, however, promoted by many TECs, in which training leads to the promotion of the employed so as to create vacancies at the bottom of organizations which the unemployed can fill, are unconvincing. The skills-ladder theory also locates the blame for unemployment on the unemployed, fails to recognize that job opportunities are largely dependent upon the economic situation and offers no way of maintaining the morale and work-orientation of the long-term unemployed themselves. So unacceptable did the policy become in 1991 that the government shifted its ground, preserved more of the ET scheme than it had first intended, introduced the Employment Action scheme of workexperience which the TECs were instructed to administer, and Michael Howard, ignoring his earlier support for Jobclubs, began to remonstrate with TECs for neglecting the needs of the long-term unemployed. Before the government restored the £120m. to ET, many voluntary organizations providing training for the unemployed began to disappear, and all training and managing agents were shedding staff. The TECs had been unhappy about the financial cutbacks, but somewhat ambivalent too because they are more interested in dealing with skills shortages than in running part of the welfare state. ‘And even the most tender-hearted of them have a huge incentive to cream off the most easily- trained jobless; a quarter of TEC income will be related to the getting of qualifications’.109 Yet so much are they agents of government policy that when the £120m. was restored, and they received pressure from government to deal with the long-term unemployed, they reversed their local policies, throwing some of their managing and training agents into confusion. Suddenly ET was to be expanded again and staff reappointed. By pacifying government in this way, however, TECs alienate the very local providers with whom they are expected to build co-operative arrangements. While they respond to alterations of

The rise of TECs

175

national policy, often more frequently than annually, they prevent local training providers from planning and budgeting ahead as they would wish to do. For their part, many local providers fail to understand the constraints under which TECs are compelled to operate, and unfairly criticize the TECs for inconsistencies in policy.110 The changing concerns of government can readily be explained. A document of the DE leaked to The Guardian in May 1991 predicted that unemployment would climb to 2.6m. by October 1991, and recorded a meeting between Sir Geoffrey Holland and the chairmen of the TECs in which they discussed how TECs could support the department’s bid for more money from the Treasury to deal with unemployment. Pointing out that the Treasury had justified spending cuts in training because unemployment had been falling, it argued that: ‘this had been followed by twelve months of rising unemployment at a rate far greater than the decline’.111 A survey of TECs reported at the meeting revealed a fear that the funding crisis would deepen, and they warned that they could not meet the government’s guarantee to provide a place for every adult out of work for more than six months. Afraid that on present funding levels TECs would be unable to meet the needs of both the vulnerable and also the valuable, who were defined as those with shortage skills, the document concluded that the situation ‘would do no good for either the reputation of the TECs or of the government’.112 This situation is ironic. First, Sir Geoffrey Holland must have felt a strong sense of déjà vu despite the propaganda about the brave new TEC initiative. It is a case of plus ça change. Second, it is the TECs’ misfortune that they bear the indelible imprint of the historical moment of their emergence. They were conceived and launched in the middle of perceptions of an ‘economic miracle’, and when unemployment appeared to be disappearing. Unhappily they came to maturity in the middle of a new economic recession with unemployment rising again. Many of their assumptions and policies were thus placed under the severest of strains. Their opponents could legitimately condemn them, therefore, for jettisoning schemes such as ET without having the wherewithal to provide an alternative for the unemployed. Yet it is an irony that the image of ET has improved by dint of its potential demise, with shadow ministers such as Henry McLeish defending it to protect the interests of the growing numbers of unemployed people. TEED officials tend to defend the ET against the charge of failure on the grounds that it was ahead of its time in that it required the Accreditation of Prior Learning (APL) and the National Vocational Qualifications (NVQ) system to be in place for it to be properly effective. They also suggest that it failed as a mass scheme, and that by March 1991 it was finding its proper level at about 200,000 trainees. By that time the official DE position was that because of unemployment it was prepared to prune £120m. off the cuts which it had

176

The politics of the training market

proposed earlier, and to offer places to the 18–24 year old unemployed for more than six months, and to other ages after two years of unemployment. This, it argued, would render ET a small, high-quality programme geared to those able to benefit directly from training. The remainder, it was claimed, would now apparently gain more from Jobclubs.113 The TECs’ lack of budget flexibility, although some TECs also protested about the lack of a decent budget in the first instance, led to a demand that the DE recognize a lobby group of TEC chairmen to promote the demands of TEC boards. This group became known as the G10 group and it was constituted along regionally representative lines. Naturally, TEC leaders wished to talk directly to ministers, and are likely to achieve more if they can advance a common view. Yet G10 is as valuable for the DE as for the TECs, since it is a representative group with which DE can negotiate and so legitimize policies. Certainly, the G10 had problems, and within a few months one of its members, the chairperson of the Bradford TEC, resigned, complaining both of the group’s futility and of the politeness of TECs towards ministers and officials.114 Many of the TEC employers and managers sought, therefore, a new and more professional body to promote TECs more effectively. Yet those inside the negotiations between the G10 group and the secretary of state deny that government officials dominate the proceedings. Truth is difficult to discern here, but there is clearly a small, enclosed but genuine policy community at work, and it appears that the dynamics of the internal relationships are not static. While a resolution of these organizational difficulties is certain to occur, the role confusion within the TEC world about the precise form and role of the G10 group continued for a surprisingly lengthy period. There was conflict between the chairmen who were perfectly happy with the status quo, and the chief executives who sought a professional association to represent TEC interests. Yet many individual TECs remained concerned that G10 might eradicate their own direct line to government. G10 is also a body which is unlegitimized by any process of election, and the chairmen who comprised it were unable to canvass all opinions before meetings or to give detailed briefings afterwards. Many TECs agreed with their chief executives, therefore, in preferring a more formal association staffed by professionals.115 It is likely that government wishes to impose broad lines of policy upon the TECs as well as to limit their expenditure, despite rhetoric about local TEC autonomy. It was the need to exert such direct control which led the government to replace the TA with the Training, Enterprise and Employment Division (TEED). An equally important political reality, however, is that the government would be embarrassed and lack policy options if the TECs were to collapse. TEC leaders do have a certain amount of leverage in the early years of the TEC’s life. The gradual fall into disuse of the term TEED, and

The rise of TECs

177

its collapsing into the Employment Department, reflected this sensitivity to the sentiments of TEC leaders. TECs, credits and targets There are other problems confronting the TECs, however, such as the direction that the credits experiment may take. Training credits will arguably undermine the role of the TECs in determining the nature of the majority of British training provision. Many commentators would deny a conflict of power here, however, on the grounds that while the owners of the credits/vouchers suddenly acquire an unaccustomed control of their own fate, the TECs still organize the guidance of these customers and manage the delivery of training through contracting. This provides TECs with a local marketing and validating role, but does not dispose of the theoretical objection that training cannot ultimately render both the employers and the consumers sovereign in the market place. While the result of the ‘pilot’ project will determine the fate of credits, there is a clear political thrust in their favour, and they appear to have fired the imagination of senior policy-makers.116 The term vouchers is unpopular in government circles because of its association with the aborted voucher scheme in education. It may be difficult to graft this novel concept on to training practices in Britain, and it is alien to West Germany where individual companies take responsibility, and to Japan where school- and college-based vocational training is favoured. None the less credits extend individual choice, create a training market, and have strong support across the spectrum. The structural problem inherent in dividing responsibility between the DE (which would fund the credits) and the DES (which remains responsible for the delivery of much of the training) was clearly addressed at a rhetorical level at the TEC conference held in October 1990. Yet TECs are left in a delicate ‘brokerage’ role between the newly ‘empowered’ credit-holder and the employers and providers. How can it deal, for example, with the employer who does not wish to co-operate by sending his workers on day release, and how can the individual get redress from employers who will not provide appropriate training? It is also evident that, far from the TEC ideal leading employers to eschew public money in order to fulfil the government goal, that employers should bear the financial burden of paying for training, and that those who sit on the TEC Boards are active in demanding both an increase in public funding and unusual degrees of freedom from the normal patterns of public accountability. The most common theoretical objection to TECs is the difficulty that confronts them in having to operate without a framework of national targets for training. This policy was enunciated by Michael Howard who succeeded Norman Fowler as Secretary of State in January 1990, as a

178

The politics of the training market

result of the promptings of the then Prime Minister, Margaret Thatcher. Fowler had laid down ambitious aims. Howard’s refusal to do so was considered regressive and appeared to contradict the government’s commitment to training.117 TEED officials loyally defend the policy, not on Howard’s grounds that governments cannot transfer power over training to TECs and then assume the responsibility for achieving targets, but rather because they perceive the industry-led bodies, the industrial training organizations (ITOs), and the NCVQ as providing a national dimension. This was not convincing. The ITOs may liaise with TECs and perform a brokerage function, and the NCVQ may harmonize national standards, but they are not engaged in inspiration, objective setting, prediction and, least of all, planning. By March 1991, and under a new prime minister who was subtly changing the agenda of the Conservative government, however, Michael Howard appeared to be reconsidering his refusal to set targets.118 This resulted from the CBI’s persuasion of the TECs and the trade unions to support the CBI’s own ambitious set of targets which it sought to establish for the end of the century to improve workforce skills. In June 1991 the CBI launched its own targets, thus rejecting Howard’s previous argument that goals were unenforceable because they did not place specific responsibilities on particular groups to ensure that they were met. In fact, Sir Bryan Nicholson who led the CBI task force on education and training believed that the CBI and the government were once more pointing in the same direction on the issue. In June 1991 the CBI was able to claim that the government was now part of a consensus including employers, employees and educationalists on the need for action to improve the nation’s skills base. So the CBI presented world-class targets for the achievement of young people which included foundation and lifetime learning. In foundation learning the aim was to have 80 per cent of young people attaining NVQ Level 2 or its academic equivalent. In addition, all young people should have: an entitlement to structured training; by the year 2000 half the group should attain NVQ Level 3; and training should focus on broad competences. With reference to lifetime learning, it was agreed that by 1996 all employees should take part in training as the norm, and at least half of the medium and larger organizations should qualify for the Investors in People award. The CBI stressed that the achievement of targets depended upon the success of educational reform, working within a relevant national framework of qualifications, local delivery, employers embracing their responsibilities and the participation of the whole of society. It was also dependent on continued government investment.119

The rise of TECs

179

Some further problems It is evident that all is not well with TECs, although some suggest that employers are investing in training to a greater degree than previously, despite mounting unemployment. Whether this is the case at a national level appears open to question. In any case, it can only be those firms which were sound enough to survive the recession of 1989–91 who did so, and the smaller base of firms emerging from the recession is a bad augury for the 1990s. The jury is also still out on the issue of whether small- and mediumsized firms are changing their practice. There is certainly some harmony between the Treasury, the TECs and the DE itself that investment in those already in work should take precedence over the long-term adult unemployed. The ideology of the ‘skills ladder’ which creates jobs for the unemployed at the lowest level of organizations is the prevailing fashion in the early 1990s. The apparent failure of ET, at least as a mass programme, and the undoubted difficulty of raising some of the ‘hard core’ among the unemployed to a position of serious skills acquisition lends support to this analysis. Yet is a harsh policy which is unproved, and as a fashion it is a part of the endemic tendency to condemn the policies which immediately preceded those currently in place. Even TEED officials confess that at the level of pure economic theory the idea that the skills-ladder assists the unemployed does not convince, so it is incumbent on the TECs if they propound the skills ladder theory to disprove the conventional economic models. Naturally, the skills ladder can work inside a firm, and a concentration on the upskilling of current employees is essential, particularly since the vast majority of the British workforce in the year 2000 was in employment at the beginning of the 1990s. Yet these realities cannot justify the relative neglect of the unemployed in social or economic terms, except in the tenets of ‘pure’ market ideology. There remains the alternative of an active labour-market policy to exploit the skills of the entire adult population. An almost exclusive concentration upon those in work at a time of mounting unemployment would be a curious admission of a decade of misdirected government/MSC policy. It is evident, however, that the postwar Keynes/Beveridge goal of full employment is now formally buried. EA was an unenthusiastic response, and in offering work-experience rather than training was an inferior version of CP.120 TECs did not have the most propitious launch if they were intended to produce local co-operation with educators and local authorities. Educators are finding it difficult to accept businessmen pontificating on education at TEC board meetings, since they consider that they themselves have far greater knowledge and experience. Equally, trade unions have been brushed aside. The extent of the sensitive bridge-building which is required should not be underestimated. Nor is it entirely reassuring about the success of the TEC

180

The politics of the training market

initiative that the DE resorted to a national advertising campaign to raise the awareness of the existence and role of TECs.121 The progress of TECs by late 1991 suggested grounds for doubt about their continuing efficacy, and scepticism continues about whether the behaviour of businessmen, particularly those of a small- and medium-sized variety, is genuinely changing. Some TECs maintain that there is evidence of change, whereas those TECs which are at the centre of the experiment with training credits, such as Bradford, claim that only by the credit approach can the problem be attacked, and some urge that the credit scheme extend to the whole country and cover further and higher education. Most appear content to ignore the training needs of the long-term unemployed, and to join the Secretary of State in his view that the main emphasis should be upon training for those in work. This is variously justified, but the prevailing opinion appears to be in favour of upgrading the skills of those already in employment. Yet the problem with ET was that it offered the wrong solutions rather than that it demonstrated the pointlessness of offering appropriate training to unemployed people. It appears, therefore, as if the pressure from TEC chairmen and the G10 lobby group largely resulted in trading off inadequate budgets for flexibility; and that flexibility has largely been confined to enabling TECs to disregard any responsibility for the needs of the unemployed. Confirmation that this was the direction of government policy was provided by the DE’s budget of £3.4b. for 1991–2 which revealed the reality of training cuts for the unemployed. The same publication revealed YT funds as £833m. for 1991–2, which included an allocation of up to £48m. for pilot projects on training credits, but also represented an overall downward trend for youth training. The Secretary of State attributed these reductions to the decline in the number of 16-year-olds joining the labour market, and the intended increase in employer contributions towards training costs. It was the ET scheme which was to suffer the greatest cuts, however, falling from £1,062m. in 1990 to £757m. in 1991. Government policy was that the unemployed should rely upon Employment Service programmes such as the Jobclubs in order to assist them back into paid work.122 The Unemployment Unit was understandably censorious about this complacency. Yet the TECs were ambivalent about the situation. While they were becoming concerned that they lacked the wherewithal to satisfy government guarantees to the long-term unemployed, they were also content to be evaluated against their attempts to succeed in such campaigns as the encouragement of company training and the enticement of women returners to paid employment.123 The TECs have also been embroiled in a controversy about the regional distribution of TEC funds. In April 1991, for example, a new formula was

The rise of TECs

181

introduced for the allocation of funds after consultations between the DE and the lobby group representing the ten TEC chairs. Instead of funds being allocated for 1991–2 as they were in previous years, on the basis of the preceding annual take-up of money which had benefited the north of England, the new formula favoured areas like the Thames Valley which had previously made little call on YT and ET funds. The chief executive of the Tyneside TEC, Olivia Grant, challenged the new formula and argued the need to move: allocations of resources from those areas where take-up of YT for example was high and employer-based YT training was low, to areas where takeup of YT training was low and employment of young people was higher’.124 TECs also found themselves in conflict with the industrial training organizations (ITOs). The ITOs were intended to develop standards of competence for the national vocational qualifications (NVQs). Yet the government did not provide the ITOs with a formal relationship with TECs, and while the ITOs complained about some TECs setting their own standards, TECs in turn accused them of interfering.125 While conflicts such as these are minor in character, their cumulative effect, coupled with the undermining impact of the economic recession in their early years of existence, have given TECs a rather unhappy start. Perhaps the government conceives of the longterm role of TECs as administrators of the training credit system, which appears to enjoy pride of place in the Major government’s White Papers on education and training of May 1991. The evidence to support this includes the new role which TECs are to be given in the Careers Service, which will have a large part to play in the guidance and counselling of credit-holders. The promise of TECs It would be a perverse view, however, to refuse to perceive merit and potential in TECs. Their local focus, their possibilities for proselytization given the composition of their board memberships, their combination of training and employment policy in a single thread of economic development, their responsiveness to local labour-markets and their capacity to act as laboratories to pilot a multiplicity of initiatives in the search for best practice are some immediate benefits. They also have a good prospect of bringing together employers, businesses, trade unions, educational institutions and private trainers in an effective local network; although the effectiveness of this in practice is likely to vary between localities. TECs also unambiguously demonstrate the centrality of business needs to the determination of training content, which cannot be left solely to professional trainers and educators. And even if it is an error to focus on the upskilling of the employed at the

182

The politics of the training market

expense of the unemployed, the concentration that some TECs are making upon management and succession training results from the experienced business focus which the public sector might otherwise have neglected. Yet this is a strategy appropriate for periods of economic success and expansion. The problem for TECs is that they cannot retain the reputation to achieve their ambitious objectives so long as they are also incapable of addressing the problems of the unemployed at a time of recession. The government had reason to be satisfied at the progress which it made in advancing the TEC initiative during 1990 since the programme was running two years ahead of schedule.126 By October all eighty-two TECs were in place, with thirty-one fully operational and fifty-one in development. There were grounds for optimism. The DE claimed: that just eighteen months after the prospectus was issued, the network of TECs is complete and over a third are fully operational. . . . It convinces me that the cynics who choose only to refer to the ‘problems’ inherent in such a fundamental change are wrong . . . The TECs movement will radically change the way that training is managed in this country; providing solutions for the needs of local people and industries; and giving British industry the necessary starring role in meeting the skills shortages of the 1990s and beyond . . . That such a change should be effected in so short a time gives me tremendous confidence in the abilities of UK employers to produce a world-class workforce. TECs will also have the flexibility to pioneer new ways of encouraging individuals to train-like the training credits being piloted by eleven TECs from next April . . . The effects of this dramatic change in the way the government funds training and stimulates enterprise will be felt into the next century. Business leaders now clearly recognise the significance of a skilled workforce for the country’s economic success in a highly competitive world market.127 This analysis was justified to the extent that the development of TECs had indeed proceeded at a surprisingly rapid rate, and that the government’s objective of securing high quality leadership for the movement appears to have been successful. It is interesting, however, that in September 1991 the DE changed course and began to allow personnel managers to sit alongside chief executives on TEC boards.128 The Secretary of State also ignored the months in which the disquiet of many participants had almost threatened the movement’s forward development. There had been an attempt in the March budget to encourage TECs to raise funds by the announcement of budgetary tax concessions for contributions to TEC activities. This does not appear to have reassured TEC development group members who were anxious to develop greater flexibility with the funds

The rise of TECs

183

that they were to be allocated, and to ensure that the cutbacks in the 1990 public-sector settlement would not be too swingeing. There were negative auguries when, in conjunction with the launching of the new Youth Training (YT) initiative, cuts in funds were also announced. Simon Beavis reported ‘bruising battles’ between the private sector and ministers over the first TECs, and described Michael Howard as being stymied in his attempt to improve Britain’s tarnished training record by being ‘hemmed in by a Treasury unwilling to loosen the purse strings’.129 The government was evidently in danger of stifling an initiative which theoretically had a great deal to commend it. The localism of their focus mitigated against the MSC’s disadvantage of behaving remotely, and of being more concerned to measure success by the number of clients entering its doors and the amount of funds that it spent. As James Buxton argued, the concept of blending enterprise development with training and devolution to local authorities has merit. ‘Helping people to find work and improving their skills is essentially the same process as aiding small and medium sized businesses to become established and competitive’.130 This is because both deal with individuals, and businesses and people alike need to assess resources, make plans and market themselves. Further, as Michael Fass and Richard Scothorne argue, the key economic development agency must operate at a local rather than a regional or national level, since it will know local needs, be more accountable and develop long-term relationships with clients.131 TECs will survive for the foreseeable future even under a Labour government. Labour’s employment spokesperson, Tony Blair, is committed to TECs while urging that the statutory basis for trade union representation be changed.132 The history of British training policy suggests that they might even enjoy a decade of life, however, and that they could then be removed without a full and fair analysis of their effectiveness. Conceived in conditions of economic growth, and in an era of an hegemonic employer ideology, their survival may depend upon their utility in conditions of economic difficulty, and their flexibility in drawing in non-employer interests. While their relationships with central government appear strained, it would be ideal if they were assisted by a national authority, while given the flexibility to develop local initiatives relevant to the needs of particular labour-markets. In July 1991 the auguries were not promising, however, particularly with the Financial Times pronouncing that both the recession and the structural issue of TEC power and organization were combining to undermine the embryonic signs of an upturn in training commitment.133 This was particularly so with the former flagship of Tory training policy, the YTS. While YTS navigated the stormy waters of the late 1980s – when it was feared that owing to the overheated nature of the labour market that young people would go straight

184

The politics of the training market

into employment – it was in fact suffering more because of the unemployment characteristic of the recession. During the late 1980s, employers took on many young people and conferred YTS employee status upon them. In the recession these opportunities evaporated. ‘Companies, including Barclays and Midland banks, and the Mothercare and B&Q retail chains have either suspended their recruitment to YT or pulled out’. By April 1992 the Citizens Advice Bureau estimated that over 50,000 teenagers a year were suffering hardship because over half the TECs were failing to meet the guarantee of a training place.134 The TEC’s predecessors, the MRC’s area manpower boards would have moved surpluses to support deficit areas, but the tight contracts enmeshing the TECs make this difficult. As well as recession there were problems created by the tensions between locally based TECs and national bodies providing training. Companies were accustomed to reaching a single national contract with the TA’s former National Providers Unit and receiving funding in a single block. The local power of TECs to tailor schemes and to impose their own local standards on providers has disrupted this arrangement, and firms complain about the duplication involved in dealing with eightytwo different bodies. In the same way TECs also appeared to be failing a group which benefited from MSC policies in the 1980s. After encouraging the myth that the economy had undergone an irreversible transformation, and then supporting the judgement that TECs should emphasize the needs of those in work through the skills-ladder concept, the Secretary of State subsequently chided TECs for forgetting the needs of the unemployed. The government rediscovered a commitment to the unemployed in the areas over which the TECs had control rather than assisting them merely through the employment services and Jobclubs, and so Michael Howard objected that TECs had inadequate linkages with the long-term unemployed. This coincided with the criticisms of voluntary groups that TECs were shunning special-needs groups which required expensive training. It was also ironic that a government that had destroyed the link between the employment and training services in 1987 was complaining that TECs did not enjoy close enough links with their regional employment service.135 It appeared that the TECs were being blamed for implementing policies which had been badly designed. Michael Howard also shifted his grounds on national training targets when he argued that TECs should set targets for the numbers of companies achieving the Investors in People (IiP) training kitemark. In this regard he sought ‘ambitious and stretching’ goals for the skills required by British workers by the turn of the century. CBI target-setting was now back in favour.136 In July 1991 the TEC movement suffered some grave blows. First, the British Printing Federation announced its withdrawal from the YT scheme. Second, the largest trade union, the Transport and General Workers, voted to

The rise of TECs

185

withdraw co-operation despite leadership pleas to remain inside. But most devastating was the leaking of a confidential DE memorandum which stated that tensions between the DE and the TECs were increasing. It urged ‘a change in approach’. Some training perspectives in 1991; the limitations of TECs The House of Commons Employment Committee’s investigations in the spring of 1991 revealed a good deal about the state of training policy in the early 1990s, and suggested that the TEC role was not the central issue. When the shadow employment spokesman Tony Blair argued that the difficulties in the relationships between the TECs and the DE involved the ‘total collapse’ of government training policy, he was overstating the position.137 There were far more issues in training policy in 1991, than merely the TEC debate. The background of recession was too important to neglect, and the committee suggested that the full implications of joining the European exchange rate mechanism (ERM) were not understood before entry.138 The report noted that all of its witnesses asserted that low productivity in Britain was the result of the lack of training, although it agreed with the Institute of Director’s (IoD) view that the problem was decades old. But it also mentioned the view of the TUC and the National Economic Development Office (NEDO) that the proportion of trainees and apprentices in total manufacturing employment had fallen from 4 per cent in 1979 to 1.7 per cent in 1989.139 Yet it is the view of the IoD which is most significant, given the proximity of its ideology to that of the government. The report asserted that the ‘IoD’s general economic philosophy was that of an enterprise culture and a free labour-market’. The IoD argument was that ‘we do not believe that the unqualified employee is fit to work in a free labour-market’. Neither was this a purely academic judgement given that 40 per cent of school leavers still have no recognisable qualification. Suggesting that this deficiency resulted from poor schooling, the IoD felt that the state should fund unemployment training, and remedy such deficiencies in basic skills training as numeracy, literacy and fluency. The IoD was convinced in its memorandum to the committee that the UK labour-market functioned poorly, and the coexistence of skills shortages and unemployment was symptomatic of the problem. Both TA and DE reports in the autumn of 1990 demonstrated that there were chronic skill shortages in the engineering and manufacturing sectors. But the dissatisfaction of the IoD went deeper in that it expressed concern that both the education and training systems were inadequate to meet employer needs. With reference to training, it believed that all 16- to 19-year-olds should receive employment training, and welcomed the training credits initiative as a step in the right direction. Supporting the TEC initiative,

186

The politics of the training market

the IoD considered that training should be locally delivered and determined by employers. Adhering to its free-market-ideology credentials, the IoD also accepted that as the prime beneficiaries of training the employers should fund the training of their own employees to keep pace with market and product cycles. Yet the IoD was realistic about the unlikelihood of employers behaving with altruism on training costs when it asserted its belief: that there must be state funding for the training of the unemployed. It believes that a well trained workforce is a national asset and that it is not the role of employers to remedy deficiencies in basic skills training, areas in which they frequently have no expertise.140 In fact, Mr Peter Morgan, the IoD’s director general, went further and argued that the 70 per cent of people who work and have no basic skills should look to the state to address their needs. He also expressed a strong interest in the voucher scheme, and wondered whether it might not be more generally extended. This could best be achieved, he argued, by giving an employment contract to all unqualified young people who go straight into work. ‘We see the training voucher as a testbed for this and we are holding fire while we examine that system’.141 Morgan also upheld the idea of reducing youth wages in order to subsidize training costs, and suggested that the West German model of the young working on trainee salaries rather than full adult pay could create space for the employers to manage more effectively. While trade unions could also play a part, the IoD’s main concept was that the TECs, as an element of their logical development, would be the quality controllers of the process. He agreed that TECs should be properly funded, and that this could be ensured if they improve their outputs. The CBI’s perspective, as a former tripartite organization which represents manufacturing industry, was different. It informed the Commons Employment Committee that the government’s role was to provide the framework of national standards, to offer certification facilities and to ensure that there was a national climate that acknowledged and recognized the efforts that people put into learning and training. 142 The TUC also supported national targets and said that there was a need for a representative national body to oversee and monitor training developments. As a result of these recommendations, the committee’s report proposed that ‘the government should set national targets for improvements in levels of skills and qualifications in conjunction with the Training and Enterprise Councils and other relevant bodies’.143 The CBI supported the training credit policy but opposed the idea of a compulsory training levy, since employers should invest in training

The rise of TECs

187

because they perceived it to work rather than because they were required to do so. The problem of ‘poaching’ was best dealt with, according to the CBI, by means of employer training contracts. The CBI and the IoD favoured the model of the German meister system where a young employee is supervised by an older worker, but not the idea of ‘sitting by Nellie’. But they also clearly favoured the new fashion for competencebased training, rather than time-serving apprenticeships. In July 1991 the Employment Secretary fully endorsed targets by joining with the CBI and the unions to provide an official launch. It remains to be seen whether this shift towards targets, coupled with the spread of credits, will strengthen or weaken the TECs. Targets could help enhance the role of the TECs by giving them the national coherence that they lack, and the continuing stress upon voluntarism as an inherent part of the government’s strategy is compatible with the employer-led character of the TEC movement. Certainly the earlier abandonment of targets had created a hole in the TEC effort. Yet if credits develop as the main means of delivery, the TECs not only fall back to a counselling and inspection role, but they are likely to share it with the TSAS, leading training agents, LEAs and the careers service. CONCLUSION There are grounds for optimism about the TECs if some of the difficulties described in this chapter can be resolved. The number and complexity of these difficulties cannot be underestimated, however, and the anomaly of a private company closely subject to political and governmental control may be too great to tackle. To succeed, the TECs require: the autonomy to introduce genuinely local schemes responsive to local labour markets; the capacity to contract for three years at a time without the risks currently involved given the annual nature of their own funding; the ability to recruit as board members whoever they consider appropriate; the opportunity to manage their own operating surpluses without Treasury intervention; the freedom to vary the implementation of training credits according to the ‘hard’ evidence of their effectiveness locally; and a more professional lobby group capable of negotiating on equal terms with the DE within a true policy community. Unfortunately, training is probably too politically sensitive for any British government to cede so much autonomy. Certainly, the TECs are responsible for an impressive range of programmes: for example, ET, YT, Business Enterprise Training, the Small Firms Service, Training Access Points (TAPs), Open Flexible Learning and much more besides. They have also been given the power to run Work-Related Further Education, involving £1.6b. and 116 FE colleges. Yet the fact that

188

The politics of the training market

the government triumphed in taking control of FE from the LEAs, despite the furore in 1984 over Training for Jobs, proves that government always wins in Britain, rather than that TECs are becoming an independent force.144 The TECs are likely to have a guaranteed existence for the foreseeable future whichever party is in office. Yet TECs must also create their own mechanisms for co-operation at both regional and national levels. Regionally, some important schemes are too small to be run on a competitive or localized basis, so a new regional TEC structure is required to deal with issues best addressed at that level. Furthermore, the government’s decision in May 1991 to strengthen the NTTF by giving it the leadership role for Investors in People, as well as granting it the authority to measure TEC performance against objectives and to advise the Secretary of State on strategic policy objectives, demonstrates that there is a crucial national dimension to training policy which was underestimated in the ideological fervour surrounding the production of Employment in the 1990s. However, the NTTF, TEED and parliamentary scrutiny are all potential checks on TEC power rather than a national dimension for the benefit of TECs themselves. Finally, if TECs are to succeed they must disprove, by the results that they achieve, the claims of the Labour Party, as well as the views of more technical experts like Ken Mayhew of the National Economic Development Office (NEDO).145 Mayhew called upon TECs to impose training levies on companies, requiring them to undertake specified amounts of training. Certainly, while TECs will be evaluated formally by the DE on their success in enhancing access to training in cost-effective locally tailored schemes, this will centrally require TECs to change the attitudes and investment in training by employers and individuals alike.146 TECs may yet be compelled to realize, however, that training is an area of market failure. It remains too early to judge.

6

The MSC, the TECs, training markets and public policy theory

A main theme of this book is that Britain has a poor record of industrial training compared to her European and international competitors, and some argue that this has been the cause of Britain’s relative economic decline.1 The importance of an adequately trained workforce in creating a flourishing economy is apparent, and Britain still has a long way to travel in generating a training culture, out of which alone, high-quality and relevant provision can develop. Effective and widespread training at both youth and adult levels is a prerequisite both of economic success and of a society composed of satisfied individuals engaged in fulfilling work. Yet training is only one source of a good national economic performance, as it must be reinforced by appropriate macro- and micro-economic policies, and by supportive attitudes and behaviour from employers and workers. Training must be linked, therefore, with other elements such as enterprise, which is particularly emphasized by Conservative governments, but also with suitable public labour-market and educational policies. Training is crucial, therefore, but sadly there would only be true grounds for optimism if rhetoric were accompanied by appropriate action. While national expenditure on training increased sixfold between 1981 and 1989 only to fall back after 1989 under the Conservatives, opposition parties still maintain that the issue has been neglected compared to Britain’s economic rivals.2 This book has been concerned with the history of British training policy and the gradual emergence of a type of training market. It has analysed these problems from the perspectives of politics and policy analysts. Inevitably, in focusing upon the immediate past it has emphasized the role of that colossus on the training scene, the MSC. Voluntarism has been the prevailing pattern of British vocational training because the ITB and MSC interludes represented a temporary policy departure, but the arrival of the TECs signifies that normality has been restored with the reappearance of a voluntary or ‘marketorientated’ approach. The interventionist interlude proved to be surprisingly lengthy considering that for ten out of its twenty-three years it was maintained

190

The politics of the training market

by a non-interventionist and free-market government. For a decade, therefore, a free-market Conservative government was unwilling to distance itself from tripartism in training policy, although it is now evident that this was a transitional phase. This concluding chapter summarizes the main arguments of the book and then addresses some fundamental issues. These issues include the reasons for Britain’s endemic preference for voluntaristic approaches to labour-market policy despite the fact that Britain’s main economic rivals enjoy greater economic success with more interventionist strategies. Given this phenomenon, however, it is also necessary to enquire into the reasons which underlay the decision of the free-market Thatcher government to sustain the highly interventionist MSC for so long when its methods were so inimical to laissez-faire. Finally, the analysis of the evolution of training and labour-market policies is set in the context of appropriate public-policy and labour-market theory. It is evident that the argument here accords with a commentator, who recently asserted that without a substantial change in the direction of training policy in Britain, the economy will degenerate to one of ‘workers producing low quality goods and services . . . the evidence of skills shortages understates and oversimplifies the consequences of the failure of our education and training’.3 Indeed, unfavourable international comparisons, short-termism, a lack of adequate legislation and reliance on market forces reveal much of what is deficient about British training. It remains an open question whether the move towards a training market will address the problem. The creation of the TECs may improve matters, and they are likely to survive under a Labour government, but there are already grounds for scepticism about the capacity of the TECs to compensate for past failure. SUMMARY AND ANALYSIS It was clearly demonstrated in Chapter 1 that training policy until 1963 was ad hoc and voluntarist in character, although a few examples of state intervention before that time resembled the ‘quick-fix’ approach of some later MSC schemes. The confusion of training initiatives with other goals was first evident in the Ministry of Labour’s inter-war training schemes. The MSC’s concern to reduce the numbers on the unemployment register reproduced the long-standing link between training and unemployment policy which originated in mass unemployment in the 1920s. Training thus became a social service since in both the inter-war years, and the 1970s and 1980s alike, training policies were established to keep the young unemployed off the streets. This harked back to the Edwardian era when William Beveridge urged ‘good and wholesome discipline for the un- and under-employed’.4

Public policy theory

191

It was also explained in the first chapter that developments in training policy are closely related to the general economic, social and ideological climate. The establishment of the industrial training boards (ITBs) in 1963 was patently a symptom of the state’s growing concern to increase by state planning the rate of British economic growth, which was perceived to be slipping behind that of its competitors. The endemic problem of the national failure to regard training as an investment capable of promoting both British and company economic development was identified in the atmosphere of the time. J. Wellens argued, for example, that Britain needed a ‘training revolution from the shopfloor to the boardroom, and . . . a new culture, a new attitude and a new awareness’ in order to retrain the entire workforce which he considered to be even more crucial than the reform of the apprenticeship system.5 The ITBs set up after 1963, under the aegis of a national legislative framework, allowed control to remain with industry in the implementation of their compulsory levy/grant system. The ITBs can be said to have failed because the bulk of the levy was merely recycled back to those firms who trained effectively, which did nothing to encourage employers to understand the importance of human capital investment. Instead, companies were encouraged to regard the levy as another production cost. Yet Patrick Ainley and Mark Corney validly defend the ITB principle when they argue that: ‘the government fails to appreciate that if the policing role of the levy/grant exemption is removed, training by industry collapses, especially in a cyclical recession’.6 It was the extent of direct ITB intervention in the affairs of firms which accounted for the growth of employer resistance and to the ITBs’ loss of their grant/levy powers, although a true audit of their worth and potential was never fully carried out at an official level. The ITBs were weakened by the 1973 Employment and Training Act which set up the MSC, but the system was fatally undermined by the 1982 Employment and Training Act, which removed the statutory status of all but seven of the ITBs. The main outcome of the 1973 Act, however, was the creation of the MSC, which was the product of a government which, under the leadership of Edward Heath, was interested in administrative reorganization to modernize Britain’s economy. Heath’s approach was redolent of the Fulton Committee’s report of 1968 which advocated a reformist and managerial approach to the Civil Service. The second chapter described the early expansion of the MSC with the full support of the labour movement and under the promptings of the Labour government. This was the period when the tripartite commission actually wielded influence, and there was something of a genuine ‘policy community’ on training, although these were the circumstances which

192

The politics of the training market

led the Thatcher government to be critical of the MSC’s role. The MSC’s independence should not be exaggerated, however, even in its early years. The statutory basis of the Secretary of State’s potentially dominant role over the MSC was apparent in the 1973 Act. It is also evident that government can favour quangos because they allow it to retain control over policy development while remaining distanced from irksome and unpopular day-to-day management. Once the trade unions had provided legitimacy to the new MSC, however, they were increasingly disregarded, until in 1987 the DE aimed to reconstitute the MSC by expanding employer representation. Another major benefit of the MSC for government was its capacity to circumvent the existing policy community which involved local government and the education service. Byrne and Padfield argued in 1986 that: central government does not need the co-operation and goodwill of local authorities to the same extent as before since it is no longer concerned about the delivery of rate services, and those programmes which the government does seek to protect or fashion may be passed into the hands of more pliant quangos such as the MSC.7 The ideology of Thatcherism readily justified the reduced role of such established democratic institutions as local government by arguing that democracy was now preserved through the market system in which the consumer is sovereign. Some commentators suggest that collective democratic freedoms have been deliberately eroded, in the name of individual freedom in the market, by government labour-market policy. Trevor Smith argued that a desire to assist the long-term unemployed: ‘should not blind us to the need to subject the MSC and its agencies to a reasonable degree of scrutiny’.8 In fact, the MSC represented a new Civil Service approach which was technocratic rather than pseudo-representative in character. Ainley and Corney make the valid assessment that the MSC was able to exploit its generous funds, when traditional local political forms were devoid of income, to buy local community goodwill. They add that the MSC actually set up a new ‘unemployment industry’ with its local clients, and that it proved to be a ‘model’ for the new ‘hived-off’ agencies, which resulted from the Ibbs report.9 The period before 1981 also ensured that the MSC was developing as a body as much committed to assuaging unemployment as to revolutionizing training. It was, in fact, its utility in the management of the crisis of youth unemployment which led the Thatcher government to retain the MSC, although its activities contradicted the government’s overall attitude towards the role of the state.

Public policy theory

193

The main focus of the MSC’s work before 1981 was upon job creation programmes such as YOPS and the Special Temporary Employment Programme (STEP). That had not been its original aim, which was to pursue a comprehensive manpower strategy that emphasized the importance of training the entire workforce. The effects of the 1973 oil crisis, however, removed hopes of the MSC’s ambitious strategy being put into effect, since the Labour government seized upon the problem of youth unemployment to arrange the delivery of a succession of training, job-creation and workexperience schemes, which acted as a quid pro quo for the trade union leaders’ acquiescence in wage restraint under the terms of the Social Contract. Not surprisingly, therefore, the MSC was very much a part of the politics of consensus. This approach was still evident in comments from the then Geoffrey Holland in 1980 when he described STEP as a programme for the future: ‘With long-term unemployment rising to record post-war levels the Special Temporary Employment Programme will become crucial in helping to contain the worst effects’.10 While Holland undoubtedly combined the older Welfare State mentality with a concern to use the youth employment crisis as an opportunity for young people to acquire the new skills to meet the challenges of technology, such concerns did not impress the Conservative government until it became alarmed at the urban riots of 1981. The true objective of Conservative youth training programmes only became apparent in 1991, when under the TECs, the YT scheme was reduced and focused upon those in work. Even under the Labour government before 1979, however, the desire to deal with the social effects of youth unemployment had altered the MSC’s ethos. This was widely perceived. John Lockwood argued in 1979 that, while the MSC was ‘a potential powerhouse and catalyst for change’, it was necessary to ‘lament that it had been eliminated from its central objective of creating a new attitude towards manpower’.11 The period from 1981 to 1987 represented the MSC’s triumphant years when it carried all before it. It began with the launch of its New Training Initiative (NTI) which the government underwrote in a White Paper of the same year. This was almost a new beginning for the organization, since it reaffirmed its training role, promised to attack the issue of adult training and stressed the MSC’s centrality in the plans to integrate youth into the labourmarket. Further, the NTI strategy was compatible with supply-side economics, and placed training at a central position in the process of assisting the private sector to accumulate profits in a competitive market economy.12 Having demonstrated its relevance to the needs of government as a ‘fire-fighting’ organization to deal with the social consequences of mass youth unemployment which secured its continuation, the MSC also offered to be proactive in areas of concern to the Thatcher government. Yet while the MSC’s

194

The politics of the training market

activity increased in this period at the expense of LEAs and established VET providers, there were weaknesses in its position. First, despite its expanding budget and responsibilities, its status as an institution semi-independent of government was undermined by a particular government committed to centralization and the promotion of its own agenda evident with the appointment of David Young to chair the organization. Second, the YTS (the ‘jewel in the MSC’s crown’), even in its expanded two-year version after 1985, preserved the earlier distortion of the MSC’s role by steering it towards job creation rather than the launching of a new training revolution. So central was the YTS that Geoffrey Holland claimed that: ‘if the two-year YTS fails then we are at the end of the road’.13 As late as 1986 James Prior argued that the YTS had helped to reshape the country’s education and training system, and that it was vital to the economy irrespective of economic conditions.14 This was not the authentic Thatcherite view, however, which by that date considered that signs of economic upturn and demographic change altered the government’s enthusiasm for youth training. Third, while the NTI implied that there should be an enhancement of resources for training, the issue of the relative balance between state and industrial financing was unresolved. It is evident that the NTI was not sufficient to provide a satisfactory statutory framework for training.15 The NTI strategy differed from the old apprenticeship system, since it wished to stress ‘portable skills’, transferable both within and between what the Institute of Manpower Studies referred to as ‘occupational training families’.16 It came to have a major impact, therefore, upon what was described as ‘the bridge from school to work’ through a series of such initiatives as the TVEI. In the adult training field, however, it was apparent even after a considerable period of delay, that the MSC’s policy was confined to the encouragement of training for identified skills shortages. The only scheme which countered this, and for that reason it was phased out in the mid-1980s, was the TOPs initiative which ‘trained for stock’. Even the short-lived TOPS scheme had failed to contribute towards long-term detailed human resource planning, which would certainly have been incompatible with government ideology in the 1980s. Most of the Adult Training Strategy unleashed by the NTI was about reacting to inescapable problems. This was unsatisfactory at the very time when the perception was increasing that ‘Britain had to train its way out of the recession’.17 It is true that MSC officials and commissioners increasingly sought, as the 1980s progressed, to transform schemes which government regarded as temporary unemployment assuaging measures into genuine programmes of training. It is a disappointing paradox, however, that while it was conditions of high unemployment which

Public policy theory

195

persuaded government to invest in adults, and thus gave the MSC the opportunity to develop programmes of subsidized adult training, the recession also had the effect of constraining MSC attempts to convince employers of the need to invest in human capital. It was unfortunate, therefore, that the goal of promoting adult training in Britain became so confused with the politics of managing unemployment which involved the propagation of the ideology that the workless were responsible for their own dilemma by lacking the qualities for employability. The main weight of the MSC’s efforts in the adult training sphere, therefore, particularly in schemes such as ET, was to refit individuals for the world of work and in the process to redefine the national unemployment problem as one of poorly skilled and badly motivated unemployed people.18 The MSC busied itself with a series of initiatives and programmes in the 1980s, and the array of initials which ensued became the MSC’s main characteristic. This forest of confusing acronyms reflected a hyperactivism when the MSC became an ally of the Conservative government’s attempt to change the nation’s values irreversibly in the direction of enterprise. This approach became evident with the MSC’s concern to promote entrepreneurial practices in society through such programmes as the Enterprise Allowance Scheme, which was concerned to reorientate as many of the unemployed as possible in the direction of starting small businesses. Training, too, was clearly intended to change the soul of the nation, and to do so by a determined attempt to alter attitudes from the bottom up, by the linking up of the Technical and Vocational Education Initiative (TVEI) and the two-year YTS. The combined effects of these two programmes which bridged school and work was to transform the educational experience, and even the value system of the majority of British youth. This was assisted by a new educational philosophy which the Further Education Unit (FEU) helped the MSC to develop. The FEU was also a bridgehead between the DES and the MSC and this facilitated the MSC in altering the terms of the educational debate. It was consistent with the goal of changing the agenda of the educational debate, but even more at odds with the government’s normal judgement about the role of the state, when the 1984 White Paper Training for Jobs asked the MSC to increase its operations in order to become a national training authority; and particularly to intervene in further education (FE) by the proposal to transfer funds previously earmarked for FE through the local authority’s rate support grant (RSG) to the MSC. Despite intense opposition over this issue, there was a tendency for educators, local authorities and employers, to grasp at MSC money to enhance their overstretched resources. This issue was ultimately compromised, however, as the local authorities kept their money in the short term but only in return for according the MSC

196

The politics of the training market

a limited role in planning NAFE in the colleges through the negotiation of annual plans. In 1991 the administration of WRFE was given to the TECs. When Bryan Nicholson replaced David Young as MSC chairman in October 1984, with David Young’s elevation to the Cabinet as Lord Young, the MSC’s role was at its apogee. This was because Nicholson inherited the Young agenda, and because Young himself became responsible for training and enterprise, enjoyed the Prime Minister’s personal confidence, and worked in close harmony with Sir Keith Joseph, who was a loyal government supporter, at DES. When the MSC’s authority was at its peak between 1984 and 1986, however, it was also coming more directly under government control. Its influence was confined to shaping policy at the margins, or resisting developments which its commissioners or officials thought unsuitable. Ainley and Corney refer to a ‘gang of four’ (Thatcher, Joseph, Tebbitt and Young) who co-ordinated policies for educational change at this time.19 It would be a travesty of government policy, however, to suggest that government and MSC were unconcerned with the real issue of the need for an overall national programme of skills training. Here there was a lack of consensus between the main political parties. Labour was not opposed to the MSC per se, as it was a partly TUC-created body which Labour had extensively used when it was in power, and the MSC was the only substantial organization which continued to operate on tripartite lines. But Labour retained a greater faith in planning, was steadfastly committed to a measure of compulsion and never really jettisoned its faith in a training levy on firms. The Alliance parties also complained that government was doing too little to increase the total amount of training, but tended to emphasize incentives to employers rather than compulsion. In substantial contrast, the Conservatives dismantled most of the remaining ITBs, and Lord Young argued that a training tax would merely lead to over-training with employers training merely for purposes of tax avoidance. So the MSC was forced to rely upon persuasion in the hope that employers would respond. Yet it was not evident that employers would alter their commercial practices simply because of such platitudinous exhortations as: ‘the aim of training is to make money’.20 Yet employers regarded training as a state responsibility. During the MSC’s National Awareness Campaign on Training in 1985, an Industrial Society survey suggested that British companies spent less than 1 per cent of sales on training. The Coopers & Lybrand survey in 1985 argued that: in the great majority of companies training is not a Board level matter. Most of the chief executives have a limited interest in what training is taking place in their company . . . Expenditure on training is rarely seen

Public policy theory

197

or treated as an investment in any financial sense . . . Training expenditure is not seen as an investment expected to lead to an identifiable income stream, but more as an overhead which can, like building maintenance, be reduced when times are hard.21 Further, as the discussion in this book has shown, the National Audit Office report was scathing about the amount of training which was taking place in the important new high-technology industries, and even more so about the MSC’s inability to know exactly how much appropriate training was taking place without undertaking a full inventory. Equally, such new initiatives as there were which aimed to promote high-technology training, such as ITec centres, were restricted in their growth because the main expenditure was aimed at producing low-level courses dealing with the needs of the unemployed. It is not surprising, therefore, that despite the MSC’s efforts, there occurred another ‘skills bottleneck’ in certain industries during the brief lull between economic recessions in the late 1980s. It is the more paradoxical since so much of the rhetoric about training and labour-market policy was about solving the problems of skills mismatches, rather than about creating a true training culture. Ainley and Corney suggest that MSC policies contributed to the process in which discrete labour-markets separated by such variables as age, gender, race and class, were further set apart.22 The MSC penetrated most areas of education and training in the period from 1981 to 1987. Not content with addressing the youth unemployment crisis with the YTS, nor permitted by government to engage in true manpower planning policies, it intruded into secondary, tertiary, further and adult education. Careless of the sensitivities of the local authorities and the DES, it became with government support a virtual super ‘Ministry of Education and Training’. Its tragedy is that, despite its creation of a network of training providers in an imaginative new contracting system, it had little more success than the ITBs or the previous voluntarist system in setting up a training culture and in converting employers to the need to invest in human capital in order to achieve business growth and success. The Conservative manifesto for the general election of 1987 suggested that the government was losing its commitment to the MSC. It is ironic that while the MSC had earned the anathemas of many on the political left, its best prospect for survival was the election of a Labour government. Although the MSC was about to embark on another of its periods of frenetic activity with the development of the ET scheme, the reality was that both economic and ideological forces were starting to destroy it. The economic force was the upturn, in part the result of international economic revival which began in 1982 and took time to affect Britain, and partly the product of credit and financial deregulation by the Treasury. The parallel ideological force was

198

The politics of the training market

the government’s growing aversion to an interventionist quango which included the participation of trade unionists, although there was also an impact from the Conservative government’s educational ideology. The MSC’s response was to cast about for new avenues of activity to demonstrate that it could still have a utility for government. This was the reason for the launch of the Enterprise in Higher Education (EHE) initiative. The DES had now retrieved much of its power relative to the DE, so that the Secretary of State, Kenneth Baker, was involved in the discussions with David Young and MSC officials which set up the scheme. Its purpose was essentially to spread the principles of the TVEI. Higher education institutions (HEIs) were invited to bid for monies from the MSC in order to introduce the principles of enterprise into the educational environment. As a result, some useful innovations in the field of personal transferable skills and work-based learning were introduced, in return for the participating institutions receiving £1m. over a five-year period. Some institutions considered it to be ‘a soul-selling exercise’, and others objected to having to bid for monies when their main sources of funding were under attack. The successful institutions used the funds to embed some exciting curriculum changes, however, and to invest in staff development. The EHE was run by the higher education branch of the MSC. The branch continues to exist within TEED, but its role was confined to networking progressive elements within the HE system, and the funding and monitoring of research projects. Such initiatives could not conceal the changing nature of the government’s educational priorities. There is no justification for an extended discussion of the ideological debates on education within the Conservative Party during the 1980s, but it is necessary to point to the existence of two broad camps. The older of the two was associated with the Hillgate Group which sought to defend traditional educational values, particularly high academic standards and the preservation of elitist schools. The group was strongly opposed to comprehensive education, and some of its adherents had produced the Black Papers to promote their views during the 1970s. This group was somewhat overshadowed between 1981 and 1985 by the ‘new vocationalists’ associated with David Young – who stressed the importance of personal transferable skills, vocationalism and the supremacy of employer needs, and who were implicitly critical of traditional British education for its anti-industrial and anti-enterprise bias. The two approaches were not easily reconcilable, although the city technology colleges (CTCs) attempted to do so. What was significant about the CTCs was that their establishment revealed that the DES had recaptured the initiative in technical and vocational education, especially when Kenneth Baker described the CTCs as prototypes for the schools of the future.23

Public policy theory

199

It is abundantly clear, however, that the main clauses of the 1988 Education Act were close to the ideas of the Hillgate Group. A combination of serendipitous short-term factors coincided with personal influences to achieve the shift in government policy from an emphasis upon vocational values and the enterprise culture, to the support of an older traditionalism. This view also happened to correspond with the prejudices of DES mandarins who were concerned to preserve a national culture of elite values through education. So neither ministerial patronage nor opposition party sympathy were sufficient to save a body which by 1987 was spending £3000m. annually, which was more than double the expenditure of universities.24 Ainley and Corney are also correct to argue that this underestimated MSC expenditure because many of the funded research projects conducted for the MSC by lecturers, teachers and others were necessarily caught up in the MSC’s propaganda machine.25 The opposition party’s support for the MSC was somewhat ambiguous, however, because the organization had been tainted by its close connection with Conservative policies. It may only have been for an interlude that this traditionalism was confidently re-established, since the new Prime Minister after November 1990, John Major, soon stressed his conviction that vocational education is of at least equal importance to academicism. He is also seized of the importance of post-school training.26 Yet the reality of the 1988 Act, and the simultaneous changes affecting the MSC provide an eloquent testimony to a new climate of policy. The 1988 Act provided the government with more direct power over schools, colleges and higher education, through the national curriculum, the incorporation of polytechnics, and contract funding for higher education, so that it no longer needed the MSC to exert influence over the education system. There was some bravado in Sir Geoffrey Holland’s remark at this time that as a result of TVEI a broadbased education would become available for all young people no matter what was ‘at the front of the Education Bill’.27 The direct threat to the MSC was evident in the 1987 Conservative election manifesto. The reform of the education system was given pride of place, and there was a pledge to create a new manpower authority solely dedicated to training. The consequent removal of the employment service in the autumn of 1987 led to a formal expression of regret by the commissioners at their loss of responsibility, and it undermined the original intention of a comprehensively planned service to relate training to employment. The loss of employment responsibilities led to the assumption that a new employment service would soon be ‘hived off’ as an Ibbs agency. That decision took over two years, however, presumably because the Treasury was concerned about the cost of so large a service, and the difficulty of controlling it. When the service was ultimately set up in 1990,

200

The politics of the training market

it was unfortunate for its clients that it was a second-rate service dealing with the needs of the most disadvantaged members of society.28 The corollary of the MSC’s loss of its employment activities was its transition to the role of Training Commission. Despite disappointment about the loss of control over the employment service, the trade unions accepted membership of the Training Commission (TC). Although the TC was launched with a confident style in autumn 1987, with a clear mission statement, the necessary Act of Parliament formalizing it occurred eight months later in May 1988. Since its abolition was announced in September 1988 it proved to be one of the most short-lived organizations in the history of British government. The year from the autumn of 1987 to September 1988 was dominated by the troubled ET scheme. Unveiled in the White Paper Training for Employment, its aim was to unite all existing adult training schemes into one unified vocational training programme. When it was formally launched in September 1988 ET was portrayed as ‘the largest and most ambitious training programme ever undertaken anywhere in the world’.29 ET’s aim was to ‘train the workers without jobs to do the jobs without workers’. Yet as well as dealing with the immediate problem of the adult unemployed and making a contribution towards overcoming Britain’s skills shortages, the scheme’s critics were convinced that there was a less benevolent hidden agenda. Some wrongly considered it to be ‘workfarist’ on the American model. There was truth in the charge, however, that ET was underfunded, and that many of its approved training organizations were unsuitable. Former MSC officials wryly point out, however, that when ET funding was cut back in 1990, the same critics deplored the reductions. This was a repetition of the nostalgia which the former Community Programme (CP) evoked when it was abolished. But in 1988 it was ET’s shortcomings which troubled critics, and it was not long before many TUC members objected. At the 1988 Congress there was a vote to withdraw from the scheme, despite typical TUC attempts to fudge an unsatisfactory compromise, and this decision led to the government winding up the TC. The Secretary of State effectively retrieved the commission’s functions with the announcement that responsibility for training programmes was to be returned to the DE itself through the instrument of the new Training Agency. Thus ended trade union and commissioner participation, which marked the resumption of complete central control over the sensitive area of training policy-making. The TUC largely played into the government’s hands with its vote, however, since there was already a scheme to increase employer representation on the commission and to freeze trade union representation. The Secretary of State cannot, therefore, have been displeased at the opportunity to shed the unions altogether and to experiment with employer-led training strategies.

Public policy theory

201

This experimentation was announced in the White Paper Employment for the 1990s, which has had the lasting effect of creating a market in training, even if of a somewhat ‘special’ nature. The document which was published in December 1988, after a three month interregnum which had Moorfoot employees in Sheffield in an anxious condition, had a visionary attitude towards the development of industrial relations. It looked towards the end of the century when trade unions would become superfluous, with individuals increasingly negotiating on their own behalf. In the training field, however, the aim was to place the ‘ownership of the training and enterprise system’ firmly with employers, through the vehicle of the Training and Enterprise Councils (TECs). TECs were to occupy a strange region, semi-private and semi-public, but despite relying on public funding they were required to operate as independent private companies working under contract from the DE. They were charged with developing locally tailored training and enterprise programmes which would both transfer responsibility for skills development investment to employers, and administer variants of youth and adult training programmes locally. They were not conceived as being heavily involved in the delivery of training and enterprise programmes, as they in turn would sub-contract on a commercial basis. Essentially, they were to be ‘organizations born of the enterprise culture’ and to engage in ‘community revitalization’.30 This was a major step towards the creation of a true training market and the central state’s divesting itself of responsibility for ensuring the development of adequate skills for the workforce. It was compatible with the government’s non-interventionist industrial policy. The other big step was the announcement in 1990 of an experiment with training credits. Having renounced their introduction to schools, the government decided to embark upon a ‘pilot’ project with ten TECs to experiment with the introduction of vouchers in youth training. THE MSC, THE TECs AND THE CASE FOR COMPULSION A full evaluation of the success of TECs will not be possible for a number of years. They should be subject to stringent evaluation, however, particularly when the ITBs were condemned without any real analysis of their achievements. This is the more necessary when it is recalled that many of the TECs’ current champions now criticize the inadequacies of the MSC’s schemes of the 1980s, even though the same individuals often eulogized those schemes when they were politically favoured at the time. The government gave the wrong signals at the outset of the TEC experiment when it retained two of its pet schemes, the TVEI and Work-

202

The politics of the training market

Related Further Education (WRFE), under the DE’s direct control. TECs protested strongly to get these schemes transferred to them, which only occurred in April 1991. The true test of the TECs will arise when it becomes clear whether the gross expenditure of employers upon training has increased, and how far TECs inspire innovative and high-quality training provision. Early auguries are not encouraging. A CBI survey in 1991 showed that training was an area already being cut back owing to recession, and a major advertising campaign suggested that market forces were not sufficient. There were, therefore, no immediate transformations in employer behaviour.31 While it is too early to judge, some observers comment that the Calderdale and Kirklees TEC is failing to take small employers with it. Since small employers are numerous in that local labour-market, this is potentially serious. Perhaps the transfer of smaller employers from the local advisory groups to the main board would help, since they would be appropriate role models. The representatives of the larger companies on the main Board are not perceived by small employers as being in a comparable situation. It now appears as if Thatcher’s government decided by the late 1980s, that with the return of economic growth, the MSC had outlived its usefulness. It is also relevant that the DES and the Hillgate group captured the Prime Minister’s ear after 1986, and the DES adopted the ideas of enterprise and competition in the somewhat ambiguous Education Act of 1988. The MSC had, therefore, fulfilled its mission. Yet the current tendency to disparage the MSC, on left and right alike, is unjustified, and the organization should not be written out of administrative history.32 If the MSC failed to overcome the shortcomings of British training policy, and to instil correct attitudes, the failure was partly the result of its being diverted from its preferred path by the government’s decision to engage in crisis management. That the MSC increasingly adopted a ‘hidden agenda’ of undermining established conceptions of education and public accountability, and of entrenching a ‘dual labour-market’ which undermined all prospect of a partnership approach to training policy-making was the product of government intervention, and should not distract attention from its achievements and potential. It is perfectly valid, however, to recognize that the MSC was deficient both in conception and practice. Right-wing critics are correct to point to its bureaucratic nature, and left-wing critics can convincingly provide examples where youth and adult trainees alike were oppressed. The MSC reflected the shortcomings of the wider British education system in neglecting the importance of adult training until the end of its time. For too much of its time the MSC was dominated by the YTS, and other useful

Public policy theory

203

initiatives such as the Enterprise Allowance Scheme, the Open Tech and Enterprise in Higher Education were subordinate. But the MSC was successful as an instrument capable of rapid policy delivery, and it helped the government through a difficult period by managing mass unemployment. Without its efforts some of the political assumptions of the post-war political consensus about the political consequences of unemployment may have proved valid. Sir John Cassels’ view is that the MSC’s tripartism encouraged consent, and facilitated the rapid implementation of necessary but controversial policies.33 He argues that while labour actually co-operated with MSC schemes, the TECs merely deliver labour into training. Further, the MSC had a national focus which the TECs lack, and initiatives such as TVEI had an effective and proselytizing effect through the motivating role of such bipartisan figures as Sir Geoffrey Holland. The MSC also had an ‘open’ style of policymaking and an effective accountability to Parliament, and its contracting arrangements with voluntary bodies and local councils enabled it to stretch deeply into civil society. It also had two dynamic chairmen in Sir Richard O’Brien and Lord Young, who had a major and enduring impact on VET for the 14–18 age group. The MSC may have been too centralist in its organization, but it had the capacity and will to achieve goals. It has lessons to offer in the 1990s, and it is to be hoped that the usual custom of denigrating systems which have just been discarded will not prevent them from being noted and learnt. The MSC may only just have begun the task of upgrading the entire workforce because it had to focus upon training the unemployed as its top priority, but it is unclear whether the TECs will outperform them, given that the government continues to control four-fifths of the purse-strings. TECs are also having to face the misfortune of the recurrent problem of rising unemployment, as well as government determination to cut public funding for training so as to ensure that employers become main providers. This last policy is a particular cause for alarm since Britain still lacks a convincing strategy for training at the level of the particular firm. Since the TECs by their very nature cannot oversee a national training strategy, their role is effectively confined to transforming the behaviour of individual organizations. Yet Frank Coffield is guilty only of exaggeration when he claims a paradox at the heart of the TECs. He suggests that to entrust the future of training to ‘a group whose commitment, goodwill and track record in this field are an international joke shows the triumph of political preferment over experience’.34 This is too harsh, however, since the TECs are tending to attract the managers of companies who do train their workforce, and have the wherewithal to do so. There is a contradiction at the heart of the TECs, therefore, and they provide no inherent capacity to

204

The politics of the training market

transform small and medium-sized employer attitudes towards investment in training. Reality is likely to be more complex, however, than judgements formed on the basis of either the political prejudice that Coffield demonstrates or the propaganda of the government and the TEC lobby group. Detailed local research on the efficacy of particular TEC strategies is more likely to produce accurate assessments. Yet even if some TECs are judged to have had a beneficial effect upon the quantity, quality and appropriateness of training in their local areas, and even if through the process of networking some of the good practice is emulated widely by other TECs, two endemic weaknesses remain. First, success in one local economy serves only to widen disparities between areas, regions and labourmarkets; and second, the TECs cannot provide the national training strategy which remains necessary in order that training does not remain the Cinderella of British economic policy. It is unlikely that the National Training Task Force has enough authority, and the industrial training organizations are neither adequate to the task nor likely to survive. At the very least, it is necessary for the government to provide TECs with targets and national training aims, as did Sir Norman Fowler. Fowler’s successor at the DE, Michael Howard, renounced targets, probably under pressure from Margaret Thatcher, and it is encouraging that CBI targets have been endorsed by John Major’s government. The White Papers of May 1991 also suggest that targets for higher education are acceptable. They also reiterate the central importance of TECs, since TEC members will serve on the new FE funding councils and TECs will also share with the LEAs the administration of the new Careers Guidance Service. The government continues to confront the problem of the dissonance between theory and practice in the amount of training which is occurring, and the TECs are unable to provide a quick solution to the problem. According to the DE, Britain was in the middle of a training revolution because of TECs, the training voucher experiment, an advertising campaign, and from April 1992 the availability of £20m. as income tax relief for those prepared to invest in their own training. The recession of 1989–92, however, has revived the issue of training for the unemployed. The renewed problem here was discussed in Chapter 5. The voluntary organizations, for example, consider that training is on the verge of collapse, owing to the DE slashing the training budget by £350m. which it later restored by £120m. These cuts fell heavily upon the ET programme, which paid for special-needs groups like offenders and the handicapped. The businessmen who run the TECs are more interested in solving skills shortages rather than running the Welfare State. Thus they are likely to cream off the most easily trained jobless, and a quarter of TEC income will be related to the gaining of qualifications. As The Economist

Public policy theory

205

expressed it, the TECs are ‘much less interested in the sort of people (like the handicapped and many ex-pensioners) who need basic, expensive education if they are to become employable’.35 Nor is it just the most unemployable in society who are losing out from publicly funded training. There also remains the difficulty that employers still refuse to invest in training, at least on a requisite scale. In January 1990 the CBI warned the government that recession was damaging Britain’s efforts to match the level of industrial training provided by competitor countries. An OECD report reiterated Britain’s poor performance relative to competitors in August 1991.36 At the same time, the Engineering Industry Training Board revealed that parts of the north were witnessing a 20 per cent reduction in the demand for courses.37 A few months later it was revealed in a TA report that 20 per cent of companies were having difficulties in recruiting. The same report revealed that 37 per cent of companies were finding that the lack of trained staff was an impediment to the growth of their businesses.38 The DE’s own Labour Market Quarterly reported on the inadequate number in full-time education and training.39 The Labour Party report Who Pays for Skills even questioned the government’s own widely quoted figure that employers spend up to £20b. per annum on training. The reality in 1990 according to Labour was that expenditure on training was £156 per employee, which was less than 10 per cent of the TA’s estimates. The report also pointed to major discrepancies between sectors in terms of percentage of total labour costs dedicated to training: for example, 0.4 per cent in distribution and 1.0 per cent in banking, finance and insurance. It further highlighted gloomy European comparisons. Spending in the United Kingdom on VET fell from 1.8 per cent of total labour costs in 1981 to 1.3 per cent in 1988 while European competitors improved their investment in training.40 Henry McLeish, the Labour shadow employment spokesman also questioned the rhetoric of the training revolution by pointing out that the numbers receiving training only rose from 9.1 per cent (or 1.8m. employees) in 1984 to 14.4 per cent (or 3.1m.) in 1989; and that out of twenty-two million employees in 1989 only three million received training in the four weeks before the survey.41 A research programme at the Technical University of Berlin, revealed the extent of the skills gap between Britain and West Germany. The general secretary of the TUC, Norman Willis, was correct to say that ‘the feeling one gets is that as we slowly increase our training effort, other countries leap faster, and further ahead. There has always been some body complaining of the way we have fallen behind’.42 Rejecting the free market he advocated a statutory approach through which all youths would gain vocational qualifications before entering work, and all adults would have an entitlement to further paid educational leave for training.43 Labour favours a national

206

The politics of the training market

training tax imposed on employers who fail to meet a minimum training threshold.44 The Liberal Democrats are also aware that even allowing for some improvement in British efforts, economic rivals are increasing their lead, and so the only solution is to lay a compulsory duty upon employers to be paid for out of a training tax or levy.45 In a similar vein a cross-party House of Lords Committee urged that employers be given a statutory duty to provide all their employees aged 16–18 with education and training leading to a qualification.46 The same report also proposed that credits be made universal, otherwise they would not be sufficient, since they could permit employers and employees to agree not to provide training. Only compulsive legislation could lead to a national strategic training framework and fill the nation’s skills gap.47 The view that training credits needed to be accompanied by compulsion and substantial public funding was also advanced both by the Lloyds Bank review and the director of NEDO (see Chapter 5). Although the Conservative government, even under John Major’s leadership, is likely to reject compulsion, it is probable that it will regard the move from piloting training credits to the setting up of a national scheme as a panacea for the problem. This view was expressed by the then Secretary of State for Education and Science at the 1990 TEC conference.48 THE TORIES AND THE MSC: A PARADOX RESOLVED While the government resisted statutory forms of compulsion, however, it retained the services of an enhanced MSC for almost a decade, even though it contradicted a pure market-led policy. The MSC was a political anomaly, involving direct intervention in the labour-market by the expansion of YOPS and YTS, and, after the NTI, in the field of adult training. Alice Brown correctly argues that: the government’s labour-market policies should not be regarded as a Uturn in the face of economic and political pressures. When one examines the nature of the policies and the form of intervention involved, in conjunction with their underlying market ethos, it can be seen that government policies were of strategic importance in meeting the overall objectives, while at the same time accommodating some of the pressures to ‘do something’ for the unemployed.49 The MSC’s intervention, therefore, possessed a market ethos. MSC officials defined their role as ‘catalyctic’ in order to generate the conditions in which a ‘pure’ training market could develop. This may have been a chimera masquerading as a strategy, but the ‘imperialist’ and ‘moneybags’ MSC, as its critics derided it, was working with the grain of Thatcherite practice.

Public policy theory

207

Its supply-side approach to resolving Britain’s economic problems bore no relationship to the unfashionable principles of Keynesian ‘demandmanagement’ which had undergone their funeral rites in the mid-1970s under a Labour government.50 It is true that some of the more persistent ‘new right’ think-tanks such as the Adam Smith Institute deplored the MSC’s role and wanted to experiment directly with a training market, and some Conservative MPs had also called for abolition in 1979. More patient ‘new right’ policy-makers were willing to endure the MSC as an interim measure, however, and accepted that it could be compatible with their goals in the longer term. The rolling back of the state in some areas required it to be rolled forward in others. Training and employment policies are inextricably connected in the labourmarket, and from 1974 to 1987 the MSC dealt with both. As an organization it was capable of being directed towards different types of ideological ends. Before the Thatcher years it engaged in putative man-power planning fully consistent with the implicit consensus between the political parties that the maintenance of full employment was a common objective. A rate of unemployment in excess of 2 or 3 per cent was regarded as socially unacceptable and politically suicidal for much of the post-war period. This was the time when memories of inter-war unemployment dominated political consciousness, whereas from the mid-1970s they became subordinate to anxieties about inflation. Unemployment remained at ‘acceptably’ low levels from 1944 to 1975, so governments had relatively little reason to give priority to labour-market policies, and training was complacently left to employers and unions, with the apprenticeship system dominant. By the 1960s worries over inflation emerged, but governments resorted to incomes policy when in power as a means of controlling prices while simultaneously pursuing a fullemployment strategy. From the mid-1970s, however, problems of ‘stagflation’ (that is to say inflation coupled with increasing unemployment) appeared and there were both international and domestic factors involved. Margaret Thatcher’s Conservative Party offered a ‘clean sweep’ with post-war policy failures, although it did so in part by distancing itself from responsibility for maintaining full employment, and by leaving job creation to the market. Yet by 1981 the combined effects of continuing international economic recession and the government’s own monetary policy led to a level of unemployment in excess of three million, which surprised ministers and forced them to seek palliatives. Government also altered the methods by which unemployment was calculated. The growth in unemployment directed government attention to labourmarket reform, and its interventionist supply-side policy appeared to contradict its aggressive market philosophy. Yet the government avoided the idea that unemployment could be dealt with by demand stimulation at a

208

The politics of the training market

macro-economic level, but as Alice Brown has argued it ‘accepted intervention at the micro-economic level in order to free the market from restrictions and improve the price and quality of the supply of labour’.51 The supply-side reforms consisted of reducing wage rates and pursuing trade union reform, but a major strategic component was its intervention in training. The experiment with ITBs (which was discussed in Chapter 2) and the subsequent relaxation of the grant/levy system in favour of the tripartite MSC (which was analysed in Chapter 3) were introduced by Conservative governments nearing the end of their terms of office. Both initiatives were enthusiastically implemented by subsequent Labour governments. This reflected the greater degree of ideological consensus which prevailed until the late 1970s. Indeed Jim Craigen provocatively argues that: ‘if anything, training issues suffered from having too low a political profile and even the CBI and . . . the TUC gave training a backseat’.52 The MSC’s establishment in 1973 reflected the apogee of the consensus on training issues, since (as was shown in Chapter 2), the TUC had long urged a central statutory labourmarket organization. The consensus on training continued longer than with other important areas of labour-market policy, however, since the Labour government’s practice in the 1970s of introducing special programmes to alleviate unemployment was reluctantly extended by a Conservative government. However, as criticism grew that special programmes were at best futile and at worst mere sources of cheap labour for irresponsible employers, the government moved to set up YTS. This was done by an appearance of tripartite consultation, although (as was demonstrated in Chapter 3) there was also skillful manipulation of the unions. The YTS offered a response to the crisis and began to address the nature and attitude of the labour force by introducing particular styles of training which sought to influence the behaviour of those in work. The DE made substantial claims for YTS. For example: the Youth Training Scheme . . . has been a resounding success . . . standards of youth training have been improved to a point where there is now good quality youth training nationwide for all 16 and 17 year old school leavers who seek it’.53 An equally selective view was expressed by the scheme’s critics, however, who asserted that it created a surrogate youth labour-market which intensified segmentation based upon age, class, gender and race. They also maintain that it: worsened the problem of skills shortages, encouraging new and sometimes inexperienced entrepreneurial trainers to dress up and sell low-skill and

Public policy theory

209

insecure work as training in a way which confused and deskilled both occupational labels and the trainees themselves.54 This deterioration in the scheme’s progress in practice, is attributed by such critics to the increasing dominance of market forces. Yet the YTS was also a calculated attempt by government to achieve specific changes. Both YTS and the entire NTI of 1981 were designed, therefore, to change the way in which the labour market functioned. The theory behind YTS was that young workers were inappropriate for the market both in skills and price. While the agenda has moved on in the early 1990s with a greater stress upon training and updating the entire workforce, the government has also been concerned to alter attitudes to work, encourage a more flexible and mobile workforce, reduce wage expectations and weaken the power of unions. ITBs and apprenticeships had provided the unions with too great a leverage over training, so the YTS, together with other measures, aimed to create adaptive workers unrelated to the labour movement. The government also wished to substitute an emphasis upon employment-related skills and attitudes for more liberal notions of education. There are many critics of such an approach: for example, Denis Gleeson argues that a curriculum which integrates arts, sciences and humanities with practical vocational skills would be more effective than the government’s preferred utilitarian bias.55 The government had the power to impose its own curricular objectives, however, and in this respect the MSC was particularly functional as it could rapidly deliver an educational change in a way that the LEAs would be unable or unwilling to achieve. This was accomplished by means of ‘sudden strikes’ such as the TVEI, and so policies could be implemented without any consultation with such old power blocks as trade unions, ITBs and LEAs. Political Quarterly argued that the MSC marginalized opposition so that ‘it effectively by-passed national and local representative government’, and thus ‘the return of laissez-faire has assisted at the birth of a new form of central state intervention’.56 Only when the members of the Commission displayed an independent policy, as with the rejection of the JTS in 1987, did the government question the MSC’s utility, and progressively remove its role. The reform of training and education was but one in a series of supplyside policies which the government introduced in the 1980s with the quite explicit intention of creating an ‘efficient labour-market’. This explains the apparent paradox of a free-market government sustaining the MSC. To quote Alice Brown once more: ‘the very need to change market behaviour requires or implies intervention of a specific nature by government’.57 Andrew Gamble

210

The politics of the training market

expressed it more forcibly and comprehensively when he argued that: ‘Britain has been moving towards a freer, more competitive, more open economy and towards a more repressive, more authoritarian state’.58 The government decided to retain the MSC in 1981, because the increase in unemployment fed a growing demand for action before there was greater social strife and political unpopularity, and industrialists complained of skill shortages and also argued that wage rates for young workers were too high. Yet there was also an evident consistency between the government’s general supply-side reforms – for example, deregulation, the free market, the ending of the Wages Council and the weakening of trade unions – and the changes which it was effecting with MSC assistance. If training is merely one of any government’s supply-side and labour-market policies, the Thatcher government outlined its labour-market strategy in the 1985 White Paper on employment. There the government’s aim was defined as being to ‘create a climate in which enterprise can flourish . . . by removing obstacles to the working of markets, especially the labour-market’. It was argued that the jobs market was the weak link in the economy, and so the reform of the supply side of the economy was crucial for the creation of an efficient labour market. The White Paper proposed to pursue a strategy so that businesses could find the skills that they required. This related specifically to the government’s training and education policies. These measures were planned, however, in the context of a free market, and were to be related to the supply-side reforms which sought to make wages responsive to market conditions by weakening unions and reducing the burden of regulations on employers so as to provide incentives for them to recruit labour.59 The MSC thus assisted the government by pursuing programmes appropriate for Britain’s restructured ‘dual’ labour-market which advanced rapidly in the 1980s. The ‘dual’ labour-market involved the co-existence of a substantial amount of part-time, temporary employment together with a large number of permanent, well-remunerated core workers at the centre of the economy. The MSC was versatile enough to provide training for both ends of the spectrum: with YTS and ET at the one end, and the Open Tech, Pickup, Graduate Enterprise and EHE at the other. The MSC proved itself to be capable of addressing the needs of a more flexible workforce and of responding to the short-term needs of employers, often without an effective knowledge of future national skill needs. This was because the MSC’s Computer Assisted Local Labour Market Intelligence (CALLMI) and Training Access Points (TAPs) were unable to deal with the national skill needs of the 1980s and 1990s. The National Audit Office (NAO) pointed to this phenomenon during the MSC’s halcyon period, when it criticized the MSC’s adult training activities for spending £1b. of public

Public policy theory

211

money, without the benefit of proper national data on the skills of the working population and the unemployed: or of any real knowledge of the needs of British industry.60 For much of the 1980s, therefore, the government retained the MSC, although it proved to be a transitional phenomenon. Yet while such commentators as Robinson are correct to ascribe greater consistency to the Thatcher government’s labour-market policies than those of other post-war governments, training proved to be a victim of this consistency as it became a part of a wider project concerned with labour-market and economic outcomes. The inadequacies of training already referred to, which were highlighted in reports and surveys during 1990–1 are a consequence of this wider and less focused approach. PUBLIC POLICY THEORY AND BRITISH TRAINING POLICY Yet the TEC strategy is not entirely market-based, despite the central role which employers perform. Certainly, the jettisoning of the Commission removes all traces of corporatism or even tripartism in a conventional sense; yet locally, in an informal fashion, many TECs are setting about constructing co-operative relationships with certain trade unions, LEAs and colleges. Public/private partnerships Since there is a great deal of public money, in the region of £2b. invested in the TECs collectively, it is more appropriate to refer, in Heclo’s terms to the ‘private government of public money’.61 This hybrid political arrangement, neither public nor private in character, is evident in the panoply of public funding and accountability associated with the TECs. This is not to deny, however, that the bias of policy is towards ‘market’ principles, since a centrepiece of TEC policy is a movement towards individual training credits. It is also impossible to neglect the free-market rhetoric about incentives and the self-interest of private efforts which underpin current training policy. And while there is a clear decline in tripartism, the current relationship between employers and the DE is one strongly reminiscent of bipartism. In any event, an attempt to return to ‘pure’ market forces is implausible in an advanced industrial society. A new article by C. Moore in the journal Politics points to three possible methods of organizing training policy. These are state bureaucracy, a ‘corporatist’ public-private mix and market-based provision. The state bureaucratic model is inappropriate in a ‘mixed’ economy, but the ‘corporatist’ model was evident in a limited way with the industrial training boards (ITBs) and more effectively in the MSC. Moore distinguishes the

212

The politics of the training market

‘corporatist’ and market models in the following terms. In the ‘corporatist’ model the state is a partner and arbiter, whereas in the market model it performs merely a general regulatory role. Similarly, training is provided under the ‘corporatist’ model through joint institutional provision by private and public interests, while under the market model provision is a private responsibility through company programmes and the use of market mechanisms such as recruitment and wages.62 The Thatcher government, consistent with its general ideological thrust, ultimately moved to overhaul training provision based on the MSC. This was because of its preference for private decisions in the process of allocating economic resources, its concern that public-sector provision was unresponsive to market signals about the changing needs of employers and its notion that corporate profitability enabled employers to afford the money to invest in training. As a result, the TECs were to be private-sector led (with other interests being there only by invitation rather than right), and the funding of the TECs was increasingly to be transferred to the private sector and other local interests, with local planning and delivery. This approach to training policy is critically analysed in Moore’s article. First, it is critical of the government’s faith in the effectiveness of markets and privatized decision-making. It considers this faith to be unconvincing as it was based only upon the hopes engendered by enhanced corporate profitability. Second, it argues that public provision could have been more effective if the MSC’s highly decentralized area boards system had been exploited in order to permit them to facilitate the devolution of responsibility to local markets. Third, it doubts the efficacy of employer self-interest as an incentive to training investment, since ‘poaching’ skilled workers by offering higher wages could be equally attractive for employers; and in any event, there is no necessary link between the training requirements of an individual company and the long-term needs of the national economy. Fourth, the article criticizes the exclusion of employees and other social interests which should be properly represented in any democracy. Fifth, it argues that in practical terms private funding would be confined to resources in kind, such as management expertise, time, equipment and property. Finally, it asserts that the government’s commitment to the local delivery of training services does not necessarily preclude a centralized framework for resource allocation, or the determination by government of strategic objectives and performance accountability. This is particularly so in a political system so dominated by Treasury controls. There are some grounds for supporting this analysis. The historic reluctance of British employers to invest in the training of their human resource has been well documented in this book, and it is plausible that many firms will be contented merely to contribute in kind. It is also true that

Public policy theory

213

better commercial practices could effectively have been introduced to the public sector of the economy. The argument that the TECs were a ‘brutal’ means of excluding interests with a stake in training has been supported even at the very highest levels of policy-makers. The strongest arguments advanced in Moore’s article are: first, that there is a mismatch between the logic of collective private provision (which can take a wider and longer-term view) and the imperatives of the market; second, that central controls over TECs are continuing, since it has been demonstrated in this study that there has been widespread TEC unease about the degree of regulation, control and tied funding in the system; and third, that ‘notions of the ‘contract state’, or ‘private interest government’ better describe current training arrangments than do liberal or market epithets. Other writers refer to ‘state franchising’ or ‘quangoizing the state’.63 There is certainly scope for debate about the precise nature of the burgeoning relationship between the private and public sectors in British politics. The funding of TECs is undoubtedly from public sources but the expenditure is undertaken by private organizations dominated by employers. The complication arises, for example, when TECs are able to generate operating surpluses, but it is clear that they enjoy little autonomy in the expenditure of this money. The ethos of TECs is also drawn from the private rather than the public sector, although some observers comment on the differentiation between those whose chief executives are drawn from the private sector, in contrast to those who have been appointed from the area leadership of the MSC. TECs vary in their view of which staff possess the more suitable experience. Increasingly, there are signs of TECs perceiving merit in a co-existence of the two. There is also the paradox that the selfappointed groups of local businessmen who comprise TEC boards are anxious to receive increased public funding and to minimize the controls to which they are then subject. Clearly the TECs are an extension of ‘contract state’, ‘public–private partnership’ and ‘private government of public money’ experiments, and their effectiveness should be judged on the pragmatic basis of whether they achieve the goals for which they have been established. Yet there are grounds for concern from the perspective of democratic theory. TECs exercise powers which have been transferred from either Civil Servants or local authorities, and do so in the name of handing power to the market and the people. Yet they are unaccountable to the electorate. The TECs already reveal some signs of the phenomenon of hyperactivity which afflicted the MSC. This is the result of the phenomenon which Downs describes as ‘the issue attention cycle’, in which problems emerge, bodies engaged in public policy-making feel constrained to respond, but when the resource implications became known they reduce their interest and public pressure also abates.64 Yet this danger may be lessened because of the localized

214

The politics of the training market

focus of TEC activities. There may be deficiencies in the extent to which the government relies upon a purely local approach to what is a national problem, but there is also evidence that the centre often got it wrong in the era of MSC dominance in the early and mid-1980s. The centralist approach is far from omniscient either in theory or practice. This problem has been identified by James as one of ‘solutioneering’: the danger that the centre sets out detailed prescriptions for what it should be doing and proposing solutions without properly identifying the problem.65 Dror similarly refers to ‘semi- convulsive’ responses to stimuli which have been allowed to build up over a period of time.66 Many of the MSC’s crisismanagement programmes in the 1980s, such as YTS and ET, were of this type, and TECs would do well to look beyond immediate concerns and ‘quick fixes’, and prepare medium- and long-term training and enterprise strategies, which really do engage effective employer investment, and which offer employees an experience such as that implied by the CBI’s imaginative notion of ‘careership’. The training issue network: is it a policy community? A central area of public policy analysis concerns the issue of who is involved in the making of policy, and how the participants interact with each other. Despite their invocation for legitimation purposes, one can dismiss conventional accounts which suggest that the people are sovereign through parliament and that the representative members of parliament make the important decisions. Other commentators suggest that parties make policy, and a committed Conservative government since 1979 lends some support here, but the role of Civil Servants and powerful external interests cannot be disregarded. The Weberian view that Civil Servants make policy excludes ministers and interests, and the technocratic analysis makes the same omission.67 It is necessary, therefore, to develop a theory which reflects the complex reality, in which politicians, ministers, the particular Secretary of State, the Prime Minister, the party, sympathetic ideological think-tanks, the Civil Servants – although intelligent ones will try to be of the same mind as their Secretary of State – and external interests of varying degrees of influence are all involved in a changing constellation of relationships, in which power is not static. While it is argued here that the British state tends to be more unchecked than many advanced democracies, and there is an assymetry in the relationship in favour of the department of state and its ministers, pluralist accounts of interest group involvement retain a measure of salience, and must be accommodated. The complex reality of policy-making in a field such as training would once have been dominated by the literature about policy communities. The concept was developed by Richardson and Jordan who described: ‘a

Public policy theory

215

breaking down of conceptual distinctions between government agencies and pressure groups; an interpretation of department and client groups, an osmosis in personal terms with ex-civil servants appearing in groups (and less so vice versa)’.68 According to their analysis, power has shifted to: ‘the policy community of departments and groups, the practices of cooption and the consensual style’. 69 Policy-making has thus become compartmentalized into vertical segments, which another commentator J.K. Benson refers to as ‘policy sectors’. 70 A less benign view could be extrapolated from R.A. Manzer’s work on educational policy-making in which he refers to an educational sub-government, involving a closed partnership of a few actors.71 The policy community theory was applied to the adult/ continuing-education field in 1987, but in modified form in order to argue that relationships had become assymetrical, and that government generally won when disagreements arose.72 Richardson and a new co-author, J. Moon, argue that the MSC was at the centre of a policy community between 1974 and 1978, although they described it as an ‘unemployment policy community’: Members of the unemployment policy community seem to recognise each other’s perspectives, recognise the need for compromise and consensus and recognise that there is a collective interest in ‘managing’ the policy area in such a way that external policies are not imposed on them’.73 It is perfectly possible to substitute the notion of a training policy community for that of an unemployment policy community, since the Conservative government was concerned about training while its preoccupation with unemployment was electoral. Yet it is true that the crisis needs generated by youth unemployment kept the MSC at the centre of its unemployment and/ or training community. Dave Marsh argues, contrary to Richardson and Moon, that there has been no policy community in these areas: rather there has been a changing policy network characterised by a developing emasculation of trade union interests and the emergence of a policy which is increasingly overtly aimed at protecting employers’ interests’.74 This debate between Marsh and Richardson and Moon can only be entered if Marsh’s terms of policy community, policy network and his third concept of mere policy consultation are defined. His policy community has few participants with some consciously excluded; frequent interaction between all members on policy issues; consistency in values, membership and policy outcomes; ideological consensus; all policy community members have

216

The politics of the training market

resources so exchanges can occur; interaction takes a bargaining form; there is a power balance in which all members see themselves as involved in a positive-sum game and group leaders can guarantee the compliance of their members. In contrast, a policy network has few participants with privileged access to government but without conscious exclusion; some members interact frequently; there will be changes in membership and access to government; the members of the network may not share an ideology but will accept the legitimacy of policy outcomes; there will be a two-tier structure in which those with resources are in the top tier and have close contact with government; the interaction involves negotiation between unequal partners rather than bargaining between strong groups; there is inequality within the network and one group may usually win although if a group consistently loses then it is likely to leave the network; interaction takes the form of negotiation rather than bargaining and leaders cannot always deliver their members. Finally, consultation has many participants with fluctuating interaction and access; a lack of consensus; consultation rather than bargaining or negotiation; unequal power relationships where some members have few resources, little access and no alternative.75 Before attempting to decide which, if any, of Marsh’s three formulations is most apposite to conceptualize the policy-making style for training in Britain, a few of his other comments should be mentioned. He pointed out that youth unemployment is not a ‘discreet’ (sic) field, and, similarly, that training policy links to education, labour-market and employment or even economic policy-making. It affects groups as diverse as: the Department of Education and Science (DES); the Department of Employment (DE); the Treasury; the National Training Task Force (NTTF); the MSC; the Trades Union Congress (TUC); the Confederation of British Industry (CBI); training and enterprise councils (TECs); individual unions; individual companies; local authorities; voluntary organizations; and campaigning groups like YouthAid, and the Unemployment Unit. As Marsh implies, there is no sign of a policy community over the longer term, and the divergence in policy-making style between the MSC years from 1974 to 1988 and the era of the TECs is apparent. The TUC has been largely removed, there is no exchange between all the putative members of the network, and the process certainly excludes trade union and local authority interests. The central actors, the DE and the TECs have become involved in a positive-sum game. It can be asserted, however, that overlying any looser forms of policy network or policy consultation, there continues a form of policy community which meets the criteria which Marsh lays down – involving the DE, TEED (which is now

Public policy theory

217

inseparable in reality), the NTTF, the CBI and the TECs. Yet the weight to be placed upon credits and the transfer of power to the customer which they imply, or the changes which a new Labour government might produce, suggest that there is a dearth of continuity which is the major feature of the relationships inherent in an enduring policy community. Yet these groups interact and bargain, share values and policy preferences and enjoy mutually beneficial exchange. Marsh also points out that there has been a progressive change in the identity of the insider groups. This partly reflects the changing policy agenda surrounding training, particularly the shift from unemployment crisis-management to the training of employees, but also the increasing ideological confidence of a government after three election victories at the end of a series of boom years. He argues that ‘over time the voluntary associations, especially YouthAid, the local authorities, the education interests and, now, the trade unions have been marginalised’.76 It is also the case that as training policy has been politically sensitive, because of its relationship to unemployment in the 1970s and 1980s and to economic and industrial revival in the 1990s, its very visibility has made for heated political debate which prevents the secrecy within which policy communities flourish. Since the theory of policy communities is inappropriate to describe the process of training policy-making, it is suitable to explore the theme of policy networks and consultation, since the criteria for their existence is far less demanding. Marsh’s account of policy networks better reflects the reality of the current training policy-making scene, since despite the fact that the inner core of the process involving the DE and the G10 group demonstrates the symptoms of a policy community, that inner core fails to monopolize the decision-making process. Outer groups such as the local authorities, some trade unions and the education world also have an input, and given their divergent policy preferences they agree to differ from the views of the groups within the core. Some participants from these outer groups refer to their dislike of businessmen pontificating about education, but endure it in order to retain their voice. Marsh’s comment that some but not all participants will have resources in a two-tier set up, and that those with resources will comprise the upper tier, is also appropriate here. The Scottish TUC’s decision to withdraw from the two Scottish LECs in which unions had been offered representation owing to their perceived lack of influence over policy outcomes, together with the request from NALGO’s Alan Jenkinson that a Labour government retain TECs in name only, makes Marsh’s comment about power relationships within networks particularly apposite.77 He represents power in a policy network in the following terms: ‘unequal powers – some groups may consistently win – however, if one group consistently loses it is likely to leave the network’.78

218

The politics of the training market

It can also be argued that training policy is made only after the least ambitious of Marsh’s forms of interaction, that of policy consultation, has occurred. Policy consultation involves a large number of groups with fluctuating contact between group leaders and core-executive policy makers, with conflict common and most groups bereft of resources, but in which losers have no alternatives but to offer their views when they are sought. This type of policy consultation was evident with the 1988 Education Act, since the Secretary of State allowed only two months in the high summer of 1987 for consultation to occur, and no significant changes emerged as a result of the process. Similarly, the Major government’s decision to engage in consultation about the proposal to replace the Community Charge appeared to be an option which it might or might not concede. Little such consultation appears to have taken place in the autumn of 1988 when the White Paper which set up the TECs was being written. This was a time when power was clearly in the DE, and government certainly ruled. But there are some signs of a two-tier network in the period subsequently, when the TEC idea was being implemented. At that stage local business organizations were in the top tier, and the other interests were permitted to take part in the lower tier, provided they were broadly sympathetic to the proposal. A later attempt to conceptualize the debate about participation in the policy-making process took place in an article by Rod Rhodes and Dave Marsh, published in 1991. They employ the term policy network in an overarching manner and differentiate five types of network. Marsh appears to have altered his position since writing the paper which has just been analysed, without offering any explanation; and to have adopted the typology advanced by Rhodes. The types of network which these authors now identified were: the policy community, the professional network, the inter-governmental network, the producer network and the issue network.79 Their definition of the policy community is close to that previously advanced by Marsh, and the issue network is defined in the same terms as those in which Marsh defined policy consultation. Rhodes and Marsh suggest that policy communities and issue networks are at opposite ends of a continuum, therefore, and the three intermediate categories are determined by the question of which interest group – professional, economic or governmental – happens to dominate them. The five types range, therefore, from policy community to issue network, through the professional network, the inter-governmental network and the producer network. Rhodes’s model suggests that there could be no such entity as a professional- or producer-dominated policy community. This implies that policy communities are either dominated by government or that they serve the interests of all the members of the community.80 This still permits the relationship which encompasses the DE, NTTF and the G10 to be described as a policy community, with variation from issue to issue about

Public policy theory

219

whose wishes prevail. It is also possible to discern the outlines of another overlapping training policy community in the terms laid down by Wyn Grant. He stresses that policy communities do not ‘conform to . . . administratively imposed boundaries’, communities are not mainly reflected in stable political structures but are as much the product of continuing personal interaction.81 It is evident that there is a group of the ‘great and the good’ concerned with training policy which comprise a personalized policy community. In the early 1990s the list of members was dominated by such names as Bryan Wolfson, Bill Jordan, Sir Bryan Nicholson, Sir Geoffrey Holland, and Roger Dawe. The evidence suggests that there are policy communities, linked both by structure and personality, nestling within a wider and more complex environment of a policy network and of even looser consultation. Rhodes and Marsh further complicate matters by distinguishing between sectoral and sub-sectoral issues, that is to say the entire field of education and training versus the sub-sectoral area of training policy.82 Granted that training is a sub-sector, it still has sufficient salience in the 1990s to be regarded as a discrete policy area with distinguishable boundaries. The authors are also anxious to distinguish two tiers within a policy network namely, the policy network proper which comprises members with resources, and the wider ‘issue network’ which includes members unable to trade resources and influence. It is hard to see what insights this apparent refinement adds, and the new category of issue networks is somewhat indistinct from Marsh’s previous formulation of policy consultation. The policy network is defined by the constellation of groups which have a sufficient identity to define themselves in terms of the groups that they exclude. When these groups are involved in policy-making – the trade unions and local authorities in the training sphere, for example – then an issue network can be said to have emerged, if only transiently. It is tempting to be cynical about these theoretical analyses and to suggest that they add little to an understanding of the process of training policymaking. This view is further encouraged by the tendency of some theoreticians to misunderstand the training policy field when they cite it for purposes of empirical validation. Marsh, for example, continues to refer to the ‘unemployment’ and ‘youth unemployment’ network. This is to impose an ideological gloss on training policy-making. Even in the early 1980s the formal justification for setting up the YTS was based upon considerations of training and employability, and even if there was an underlying intention of responding to the political problem posed by unemployment, the MSC sought to strengthen the training content of YTS. By the 1990s, however, Marsh’s reference to the unemployment network in the context of his references to youth training is singularly inapposite. The Thatcher years have revealed to government and policy-makers alike that it is possible to ride out

220

The politics of the training market

unemployment as a contentious political issue, and the focus in the 1990s is upon training for the employed. To refer to the unemployment rather than the training-policy network is, therefore a misnomer.83 Nevertheless, there is some purpose in reviewing and applying the theoretical literature to the issue of who takes part in training policy-making. There are certainly tiers of influence, access and resource. The DE, the NTTF, the G10 group of TEC chairs, and the CBI form an inner core, and other groups play an intermittent peripheral role, while a plethora of voluntary organizations and others may occasionally be engaged in token consultation. Training may be a sub-sector of education, employment and economic policy worlds, but it is important as it straddles all three and is at present inherently high profile. The inner core could be described as a policy community, or perhaps even a training sub-government, except that it lacks stability and continuity. It is as yet too new to establish any such claim, and the policies of any future Labour government may alter relationships. A training-policy network is more evidently discernible, with key individual personalities and groups occupying a central role. Now that government has invested great hope in the TEC initiative, the leaders of TECs are in an influential position. Yet the disquiet in TEC ranks in the spring of 1991 about funds, flexibility and the difficulty of interesting employers in training investment at a time of recession, provide a sharp reminder about the continuing controls exercised by central government and the Treasury. The protests of G10 reveal the basic contradiction which lacerates the TECs. Set up to operate like commercial organizations and directed by major private-sector employers, they find themselves overwhelmed by bureaucratic requirements of public accountability and public funding. The interstices between public and private create enormous problems for those who have to operate in this increasing, but still relatively uncharted, territory in modern government. Yet if the requirements of public accountability are too intrusive for the private-sectorbased TEC members, they are scarcely subject to proper parliamentary scrutiny. Marsh and Rhodes worry that public-sector professionals are too dominant within policy networks, but in this and a growing number of other networks in contemporary government there are grounds for alarm about the monopoly of power over public monies wielded by self appointed leaders drawn solely from the business community. Training policy: the rationalism/incrementalism debate The equally central question in the realms of policy analysis of how policy is made, and in particular the debate between the exponents of incrementalism and managerial/rationality, closely relates to the Rhodes and Marsh analysis, since they argue that policy networks provide an explanation for policy

Public policy theory

221

change. This is because networks tend to routinize relationships and to promote continuity and stability, and particularly where there is a policy community in place, to constrain agendas and outcomes. So policy networks help to foster incremental outcomes. Further, the dominance of professional and producer groups which, together with government, tend to dominate networks, mitigate against policy innovation. Rhodes and Marsh validly argue that while the power of government countervails these interests, it scarcely does so in the common interest. They also argue that government is fragmented, and sometimes individual departments and powerful interests develop common perspectives. Richardson and Jordan expressed the policy-making map as ‘a series of vertical compartments or segments – each segment inhabited by a different set of organized groups and generally impenetrable by “unrecognized groups” or by the general public’.84 In advancing this view the authors suggest that pluralism and interest-group politics are benign in their effect, as there exists a variety of networks which countervail each other. They are too sanguine so far as training is concerned. This is because, first, the government has considerable autonomy, even if its extent varies over time, and second, the enthusiasm for a private-sector and market approach to training may not produce the optimum policy to achieve the necessary results. In an area of policy such as training this can cause grave national economic failure. The issue of how policy is made has been much discussed and is of limited relevance here. There are two substantial questions which the present author discussed extensively in the area of adult education policy-making.85 Two main aspects were identified there: the impact of environmental factors, and the controversy surrounding the H.A. Simon and C. Lindblom debate about rationality against incrementalism in the policy-making process. Clearly, the extent to which training is perceived as a salient issue is partly a product of factors beyond the control of all actual or aspirant policy-makers, and involves economic, ideological, technical and institutional factors. Circumstances help determine which pressure groups or interests are pushing against an open door at any particular moment. Technical preferences for managerial and administrative solutions in the early 1970s ensured that when the CBI and the TUC urged the creation of an organization to regulate employment and training policy they were likely to be well received, and this was the climate which led to the creation of the MSC. The MSC itself became ‘thinkable’ because of the way in which the ITBs were perceived to have been ineffective and unpopular. The decline of manufacturing industry and the dramatic rise in unemployment led to the recognition by the Thatcher government that action was necessary, and the character of the MSC enabled it to meet the requirements of the ruling party, but when trade unions and others became obstructive, and a revival of economic activity reduced the worst

222

The politics of the training market

of the social and political threat, the government was able to create a new type of network which reflected the importance of a second environmental influence, that of ideological change. The Thatcher Conservative government was an instrument of much of the ‘new right’ doctrine which emerged in the 1960s and 1970s, particularly in the United States. There was a complex of ideas ranging from monetarism, supply-side theory and public-choice theory to the prejudices of the moral majority; but the idea of the free market, and its capacity to deliver benefits in a value-free way, was central. By 1988 it was apparent that the governing party’s ideology was affecting the emergence of training policy. Yet even here it was the perceived easing of economic difficulties which liberated the Conservatives to introduce TECs. Rhodes and Marsh express the point colloquially: The trade unions were deemed the enemy within, the educational professions were ‘handbagged’ and both were excluded from the gestation and development of youth training and vocational education’.86 Technical factors also possess an independent influence upon the policymaking process. It was the mounting evidence, intensified by new computerized sources of information on local labour-markets, such as CALLMI, which alerted government to the possibility that money invested in training was not being directed appropriately towards training for real or anticipated vacancies in particular local areas. This discovery, which was facilitated by new technology as well as by the advance in knowledge promoted by the MSC’s research department after 1983, simultaneously undermined nationally planned programmes aimed at unemployed people through a speculative approach. It was only a matter of time until small, locally designed and delivered programmes came to take the place vacated by major national programmes. All policy networks are pervious to outside forces, and to suggest otherwise is as erroneous a judgement as to suggest that all conscious political change is determined by external forces alone. In reality, economic and technical change is mediated by party ideology. Sir Geoffrey Vickers has produced a realistic view about the pace of change that occurs in government, and modifies incrementalism into appreciative incrementalism.87 His view is that while policy change is generally cautious and phased, there are periods when the world-view of many of those who exercise power alters so substantially that this leads to uncharacteristically major alterations in policy. His argument is less that the external world has spectacularly changed than that the manner in which policy-makers perceive it alters. When a new need is perceived, then novel political solutions which break with the established patterns appear on the agenda.

Public policy theory

223

In these circumstances policy networks may seek to limit change, but they cannot remain oblivious to new appreciations of reality. As Marsh and Rhodes express it: the environment is not ‘given’, it is both constituted and constituitive and the analysis of the ‘appreciative system’ of actors in the policy network is central to understanding this interactive process’.88 The discussion about policy networks and communities has now merged imperceptibly into the debate about incrementalism and rationality in the policy-making process. To argue that training policy-making at any historical juncture in British history has been entirely rational would be a difficult position to maintain. In recent years, however, the capacity to absorb and retrieve information, and to develop sophisticated versions of programme analysis and review, has added to the credibility of the Conservative government’s claims to be making policy in a rational manner. Yet crisismanagement has also been evident in the decision to launch schemes such as the YTS, and ideology is clear in the creation of TECs and the promotion of training credits, as is general confusion in the waxing and waning of enthusiasm about the setting of national training targets. Etzioni’s model of ‘mixed scanning’ has some utility, therefore, in that it explains the way in which policy-makers shift between incrementalism, rationality and even radical visioning in the course of making policy.89 Vicker’s ideas about appreciative incrementalism can also explain those intermittent times when non-incremental decisions are made. Both Vickers and Etzioni explain, therefore, the shifts from extended periods when policy changes little: for example, voluntarism before 1963 and varying forms of active state interventionism from 1963 to 1988, to dramatically creative innovations such as the ITBs, the MSC and the TECs. Vickers is more applicable, however, since Etzioni makes the shifts from one mode to another appear to be immanent to the policy-makers themselves and unrelated to exogenous influences, whereas Vickers helps illuminate the appreciative process. Such a process was apparent in the modernization preoccupation of the early 1960s, the consensual commitment to planning by expert and autonomous agencies in the early 1970s, and the widespread confidence in the efficacy of ‘market’ solutions in the late 1980s amid the crumbling of East European Communism. The theoretical disputations among policy theorists on policy networks, incrementalism and related themes is less relevant at the present time than is the work being undertaken in the wake of Heclo’s private government of public money formulation. It is arguable whether such concepts, or those of the ‘contract state’, are an adequate description of the current methods of policy-making and implementation, and these are perhaps the most important

224

The politics of the training market

contemporary themes which require further analysis and investigation. The penumbra between public and private, in which grey area the TECs, the managing and training agents of various government schemes and the National Training Task Force all operate, requires a different conceptualization from that which has so far emerged. The introduction of commercial principles and internal markets in state bodies, and the awarding of large sums of public money to private companies and agencies to deliver broad public objectives, is now central to training policy in Britain, and more debate is required here. Nor is the issue one which should merely concern public administration, since these developments have profound implications for democratic theory. The more that public objectives are transferred to private organizations such as TECs to deliver, particularly where the monitoring and evaluation is left to departmental Civil Servants and ministers rather than to elected representatives, then the greater is the threat to democratic accountability. Rhodes and Marsh consider the growth of the expert public sector as a source of concern about concentrations of power and problems of unaccountability. This anxiety redolent of ‘new right’ and ‘public choice’ literature in the 1970s, should now be redirected towards the new semi-private, semi-public area, where so much expansion has recently taken place. Finally, some mention should be made of the extensive literature on the problem of policy implementation. Dunsire, Hogwood and Gunn, Ham and Hill and others have drawn attention to this major area increasingly since the late 1970s.90 It is true that the government and the DE focus on the problem in the elaborate mechanisms of evaluation and control that they have established, their power to reject the continuation of particular TECs through the agency of the NTTF, and their budgetary control. Yet scepticism seems warranted about the capacity of government to overcome the greatest implementation problems of all in the training field, which have bedevilled successive governments. First, there is the task of persuading employers to increase their investment in training. Neither Conservative schemes, incentives or ingenious strategems on the one hand, nor Labour statutory compulsion on the other, will lead to the implementation of that ultimately important goal, unless employers become culturally convinced that training is a central and not a peripheral activity for their companies. Governments cannot wait passively for cultural changes, however, and the implementation literature suggests that employers must be fully engaged in the formulation of policies if they are to implement them in the enthusiastic manner necessary for their success. Policies should not be imposed upon employers, therefore, whether they are statutory, or unrealistically based on erroneous theories about the pressures of ‘markets’. Second, there is the need to ensure the preservation of quality in the myriad of organizations which deliver training.

Public policy theory

225

Increased monitoring, auditing and inspection by bodies like the National Audit Office and the Training Standards Advisory Service would help. Training-policy implementation cannot be described as successful until the ‘rip-off’ factor, repeatedly identified in NAO reports, has been eliminated. TRAINING FUTURES Training has finally achieved the political dominance that its importance as an issue actually warrants. There is less room to be sanguine, however, about the solutions that are being attempted or even advocated. While Bryan Gould’s simplistic statement on behalf of the Labour Party that the market has led to poaching not training is partly propagandist, his solution that government intervention is necessary to produce training investment cannot be dismissed. But he is not correct in asserting that training has always been left to the market in Britain, since there have been extensive periods of interventionism. While the experience of the ITBs and the MSC are being undervalued in the early 1990s, they too failed to create the culture in which employers and employees feel it appropriate to invest in their own training to an adequate extent. Too much faith is placed by Conservatives, however, on the impetus of a free training market, given the experience of earlier periods of British voluntarism in this sphere, and the conflict between individual and collective rationality. It is true, however, that the government revealed ingenuity and innovation in such projects as TECs, and the CBI has been particularly creative in gestating such ideas as training vouchers and the concept of careership within occupations. It is difficult to accept on present evidence, however, that such structural tinkering can generate sufficiently far-reaching changes in attitude, and even if some improvements occur they are unlikely to keep pace with the accelerating pace of training investment in other European countries. Many of the TECs may avoid the rapid collapse in morale or the deterioration in the quality of membership which their proponents feared, and which undermine the Boston PICs in the United States. It is difficult to defend the position, however, in which employers exclude trade unionists and others in an area of policy where they wish to be constructive. TECs may particularly need to nurture the understanding of formerly rejected training partners as they encounter the threat that the rising unemployment figures of the early 1990s pose. In the same way it is difficult to accept that there is a sufficient national impetus behind a training effort even with the extension of the NTTF’s role in monitoring the performance of individual TECs. Finally, the extent of the Major government’s commitment must be questioned, given the budgetary cuts imposed upon TECs and the decline in training opportunities for unemployed people. In the summer of 1992 there is little sign of the investment of public resources which is required (to match

226

The politics of the training market

the political rhetoric) but rather there is the threat of further cutbacks to TEC funding, not merely with ET but also with such initiatives as Business Enterprise, which the recent Chief Secretary to the Treasury, David Mellor, described as a luxury.91 The now Chief Executive of the Calderdale and Kirklees TEC, Alastair Graham, felt it necessary in September 1991 to remind employers that when the recession ends they will rediscover the difficulty of recruiting skilled and trained personnel. As he put it: ‘the demographic time bomb is still ticking’.92 TECs deserve to be given every opportunity to achieve the objectives that they have been set. They face structural problems which it will be difficult for them to overcome: for example, they are too parochial for certain purposes, and their contractual relationship with government is such that they cannot exercise true policy-making and financial autonomy. So far, individual TECs vary in their performance, but it is their misfortune to have been conceived at a time of economic growth but launched at a time of recession. A major national initiative is necessary if there is to be a revival in manufacturing industry, which is essential for a strengthened British economy. While Conservatives may be correct to argue that Labour is mistaken to advocate a straight transfer of Japanese or German experiences to Britain given the different historical background, they too should be less convinced about the utility of the American model, particularly given the failure of the PICs to sustain their early momentum. Certainly, cultural change is capable of achievement only in the long run, but that is why the state must take the initiative and be prepared to invest directly itself. Such investment will provide the incentive for other parties to do likewise. The state should also seek to work with other bodies interested in a national training effort, and to evaluate in as open and technical a fashion as possible all of the methods with which it experiments, including those rooted in ideology such as TECs and training credits. The yardstick of success must also be international comparison, as was recognized in the 1984 Challenge to Complacency report, and not the earlier, patently inadequate British performance. The historical record tends to support an energetically pragmatic approach, rather than the ideological dogmatism of either free marketeers or state interventionists. It is not suggested that the conquest of ideology in policy-making is ever possible. Rather, it is recognized, that in a country which is neither fully entrepreneurial nor decisively welfarist in its cultural situation, an eclectic ideological approach is required – containing apparently competing ideological ingredients. Change is also more likely to be achieved and implemented if all the partners are engaged. This implies the development of a true policy community embracing all those who have an interest in increasing the quantity and quality of training investment. While Labour may adopt a more consensual approach, however, it may also inadvertently alienate the

Public policy theory

227

employers by resorting to interference and compulsion, which might serve to create a ‘loophole mentality’. This could imply the need to return to an organization with at least some of the characteristics of the MSC, capable of building a consensus and providing a strong national lead. However, the emergence of such a new organization need not undermine the idea of a ‘training market’, in which decisions are left to employers, TECs and, in the case of credits if a policy evaluation proves them to be effective, individuals. Free market purists should discard their illusion, however, that the training market is anything other than a ‘special’ market. Any new national organization should take the place of the insubstantial NTTF, and provide a national lead to the TECs. While unashamedly representing the major national interests, including trade unions and training professions, a new national organization should avoid the problems of the MSC. It should answer to the DES rather than the DE in order to link with vocational education generally, and to avoid the political pressure to subordinate training to short-term electoral concerns like the management of unemployment. It should have the political independence to recommend policy, or to resist proposals based on pure ideological theory; and to develop its own networks and expertise. A new training and labour-market organization should also advise government authoritatively about the issue of the need for a compulsory training tax or levy, and of the viability of the ‘skills ladder’ theory as the best means of assisting the unemployed back to remunerative employment. Flexibility and responsiveness to markets are not incompatible with some medium- and long-term strategic planning, and partnership with employers need not exclude the national and macroeconomic perspective. While much can be left to market forces and to society at large, an organization should guide the integration of mental and manual labour through a training policy appropriate for a technological economy, monitor the national vocational qualifications system which NCVQ is producing, and deal with the needs of school leavers, employed and unemployed alike. The Thatcher government contributed to the new consciousness of the importance of training but, in abolishing the MSC, removed a tool to deliver the lead that is required. The challenge for the 1990s is to re-establish a more effective and less tarnished tool to guide and regulate the newly emergent training market.

Notes

INTRODUCTION 1 2

The Guardian, 22 December, 1990. Financial Times, 21 November, 1989.

1 INDUSTRIAL TRAINING BEFORE THE MSC 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17

C. Barnett, The Audit of War: The Illusion and Reality of Britain as a Great Nation, London, Macmillan, 1986, passim; M.J. Wiener, English Culture and the Decline of the Industrial Spirit 1850–1980, Cambridge, CUP, 1981, passim. J. Goldthorpe (ed.) Order and Conflict in Contemporary Capitalism, Clarendon Press, 1984, p. 3. A. Sorge, ‘Technical education and training as a public concern in Britain, France and Germany’, Management Research News, 1979, vol. 1, no. 1, p. 2. J. Sheldrake and S. Vickerstaff, A History of Industrial Training in Great Britain, London, Avebury, 1987, p. 2. C. More, Skill and the English Working Class, Beckenham, Croom Helm, 1980, p. 41. Sheldrake and Vickerstaff, op. cit., chapter 2. B. Evans, Radical Adult Education: A Political Critique, London, Croom Helm, 1987, chapters 1 and 4. J. Currie, Industrial Training, London, Royal Society of Arts, 1920, p. 6. K. Middlemas, Politics in Industrial Society, London, Deutsch, 1979, pp. 256–65. Sheldrake and Vickerstaff, op. cit., p. 14. Quoted in Sheldrake and Vickerstaff, op. cit., p. 14. Sheldrake and Vickerstaff, op. cit., p. 14. R. Davison, British Unemployment Policy Since 1930, London, Longman, 1938, p. 117. B. Swann and M. Turnbull, Records of Interest to Social Scientists 1919– 1939, Employment and Unemployment, HMSO, London, 1978, p. 162. Evans, op. cit., p. 207. Sheldrake and Vickerstaff, op. cit., p. 20. ibid., p. 24.

Notes 18 19

229

Evans, op. cit., p. 279. Ministry of Education, 15–18 Report of the Central Advisory Council for Education, HMSO, 1959, vol. 1, para. 486. 20 Ministry of Labour and National Service, Training for Skill, report by a subcommittee of the NJAC, HMSO, London, 1958, para. 83. 21 Many such books were published, and a favourite political cliché of the time was that ‘Britain must either change or decay’. 22 Middlemas, op. cit., chapter 14. 23 Sheldrake and Vickerstaff, op. cit., p. 33. 24 British Employers Federation, 41st Annual Report, Administrative Year 1960, p. 23. 25 British Association for Commercial and Industrial Education, Industrial Training – Whose Responsibility?, BACIE, 1962, p. 9. 26 S. Vickerstaff, The Limits of Corporatism, unpublished PhD thesis, University of Leeds, 1984, Chapters 4 and 5. 27 Ministry of Labour, Industrial Training: Government Proposals, HMSO, 1962, para. 5. 28 Hansard, 20 November 1963, col. 1016. 29 Sheldrake and Vickerstaff, op. cit., p. 35. 30 Times Higher Education Supplement, 15 April 1988. 31 The Bolton Committee of Enquiry into Small Firms, (Cmnd. 4811), HMSO, 1971, paras 14, 22–24. 32 M. Woodhall, ‘Investment in industrial training’, British Journal of Industrial Relations, vol. 12, March 1974, p. 79. 33 ibid., p. 80. 34 Department of Employment, Training for the Future, HMSO, 1972, p. 52. 35 Woodhall, op. cit., p. 81. 36 The Confederation of British Industries, Education and Training Bulletin, 1972, p. 2. 37 Department of Employment, op. cit., p. 11. 38 J. Hughes, ‘The role of manpower retraining programmes: a critical look at retraining in the United Kingdom’, British Journal of Industrial Relations, April 1973, pp. 221–2. 39 J. Thirlwall, text of lecture given to the Manpower Society in London, 3 November 1970, and later (1973) rewritten for British Journal of Industrial Relations. 40 B.J. McCormack, ‘The political context of manpower forecasting in Britain’, British Journal of Industrial Relations, vol. 15, no. 3, 1977, p. 411. 41 ibid., p. 403. 42 Training Officer, Comment, 1971, p. 411. 43 Department of Employment, op. cit., pp. 4–6. 44 ibid., 1972, pp. 7–9. 45 Trades Union Congress, Annual Report, 1967, p. 48. 46 Fulton Committee Report on the Civil Service (Cmnd, 3638), The Treasury, 1968, pp. 147–9. 47 P. Hennessy, Whitehall, London, Fontana, 1989, pp. 22–3. 48 Training Officer, Comment, 1978, p. 83. 49 ibid. 50 D. Howells, ‘The Manpower Services Commission: the first five years’, Public Administration, vol. 48, Autumn 1980, pp. 306–7.

230 51 52 53 54 55 56 57 58 59 60

Notes J. Biffen, Contemporary Record, vol. 2, no. 1, Spring 19??, p. 16. Department of Employment, Chronicle, 1972. Training Officer, May 1972, p. 195. Undated papers and documentation in the TUC archives. ibid. Trades Union Congress, Annual Report, 1973, p. 58. ibid. Department of Employment, op. cit., p. 60. Howells, op. cit., p. 312. Sheldrake and Vickerstaff, op. cit., p. 46.

2 THE MANPOWER SERVICES COMMISSION: 1973 TO 1981 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29

D. Howells, ‘The Manpower Services Commission: the first five years’, Public Administration, vol. 58, Autumn 1980, p. 310. ibid. Manpower Services Commission (MSC), Towards A Comprehensive Manpower Planning Policy, 1976, p. 1. Management Services in Government, vol. 34, no. 2, May 1979. B. Evans, Radical Adult Education: A Political Critique, London, Croom Helm, 1987, chapter 3. Howells, op. cit., p. 319. MSC, Annual Report, 1975–76, p. 30. Howells, op. cit., p. 320. House of Commons, First Report of the Employment Committee, 1980, ‘The MSC’s Corporate Plan’, 1980–84, p. v. M. Birch and B. Wood, Public Policy in Britain, Oxford, Martin Robertson, 1983, pp. 213–14. House of Commons, Sixth Report of Public Accounts Committee, 1975–76, paras. 30–40. Hansard, 27 July 1979, cols. 629–30. Times Higher Education Supplement, 31 May 1991. MSC, Annual Report, 1978, p. 11. MSC, Job Centres: An Evaluation, 1978, p. 1. MSC, Job Centres Evaluated: A Success Story, 1973–1977, unpaginated. MSC, Annual Report, 1976, p. 14. MSC, Plans and Programmes, 1974. British Journal of Industrial Relations, vol. 14, no. 3, November 1976, p. 360. MSC, Annual Report, 1977–8, paras. 5.6–5.21. MSC, Annual Report, 1976–7, para. 42. MSC, Annual Report, 1977–8, para. 14. Howells, op. cit., p. 314. MSC, Annual Report, 1977–8, Chairman’s Introduction. ibid., paras. 5.1–5.3 MSC, Annual Report, 1977–8, table 31. C. St. John Brooks, ‘Who controls training? The rise of the MSC’, Fabian Tract, 1985, p. 97. Journal of European Industrial Training, vol. 1, no. 6. MSC, Annual Report, 1978–9, table 23.

Notes 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73

231

MSC, Annual Report, 1975–6, Chairman’s Preface. Discussed in British Journal of Industrial Relations, op. cit. MSC, Meeting the Challenge, 1973, no pagination. MSC, Training for Skills, 1987, p. 5. ibid. ibid., para. 4, p. 17. S. Vickerstaff, ‘The limits of corporatism’, unpublished PhD thesis, University of Leeds, 1984, p. 59. MSC information note, Measures to Counter the Effects of the Current Recession on Training: 1975–79, December 1978, p. 1. MSC, Towards a Comprehensive Manpower Planning Policy, 1976, para. 1.3. ibid., para. 1.12. ibid., para. 4.57. ibid., paras. 5.36 to 5.39. ibid., paras 5.36 to 5.39. Howells, op. cit., p. 312. MSC, Review and Plan, 1978, Foreword. Howells, op. cit., p. 312. MSC, Review and Plan, 1978, para. 3.34. MSC, Training for Skills, 1977, para. 3.3. MSC, Review and Plan, 1978, para. 4.22. Department of Employment (DE), News, 1979, p. 63. MSC, Outlook on Training, 1980, paras. 3.3 to 3.6. R. Huntlay, ‘Education, training and the labour market’, European Journal of Education, vol. 16, no. 1. J. Sheldrake and S. Vickerstaff, A History of Industrial Training, London, Avebury, 1987, p. 50. House of Commons, First Report of the Employment Committee 1980, p. v. ibid., p. 6. MSC, Corporate Plan 1980–84, 1979, para. 5. House of Commons, First Report of the Employment Committee, 1980, p. viii. ibid., p. 9. ibid. ibid. ibid., p. 7. ibid., p. 2. MSC press release, 19 December 1979. House of Commons, First Report of the Employment Committee, 1980, paras. 1–1.12. ibid., p. 74. ibid., p. 75. ibid., p. 80. ibid., pp. 224–305. DE, Tempo, February 1991. MSC, Outlook on Training, 1980, paras. 3.3–3.6. ibid., para. 6.6. Financial Times, 13 October 1981. Sheldrake and Vickerstaff, op. cit., p. 51. ibid., p. 82.

232 74 75

Notes Central Policy Review Staff, Education, Training and Industrial Performance, London, HMSO 1980, paras. 16 and 31. Management Today for July and November 1980.

3 THE MSC IN ITS GLORY: 1981 TO 1987 1 2 3 4

In conversation with the author. Department of Employment, Trainer’s Briefing Collection, DE, issue 1, 1991. In conversation with the author. S. Savage and L. Robins, Public Policy Under Thatcher, London, Macmillan, 1990, p. 53. 5 ibid., p. 53. 6 L. Fullick, ‘The MSC and the local community’, in C. Benn and J. Fairley, Challenging the MSC, London, Pluto Press, 1986, p. 226. 7 ibid., p. 228. 8 Savage and Robins, op. cit., chapters 10 and 11. 9 ibid., p. 53. 10 J. Everseley, ‘Trade union responses to the MSC’, in Benn and Fairley, op. cit., p. 218. 11 ibid., p. 229. 12 TUC, Annual Report, 1984. 13 Central. Policy Review Staff, Education, Training and Industrial Performance, HMSO, London, 1980, passim. 14 Everseley, op. cit., p. 209. 15 Report of a conference on ‘Training and the State’, attended by trade unionists, feminists and socialists, April 1985; unclassified TUC records, held at Congress House. 16 Everseley, op. cit., p. 221. 17 C. Short, ‘The MSC and special measures for unemployment’, in Benn and Fairley, op. cit., p. 42. 18 ibid. 19 In conversation with the author. 20 Short, op. cit., p. 47. 21 MSC officials in conversation. 22 N. Tebbitt, Upwardly Mobile, London, Weidenfeld & Nicolson, 1988, pp. 180–1. 23 The Guardian, 5 February, 1982. 24 ibid. 25 C. Mason and R. Russell, ‘Why does the corporatist state regard vocational education and training as an issue?’, paper presented to the Political Studies Association Conference, Nottingham University, April 1986, p. 44. 26 Benn and Fairley, op. cit., p. 44. 27 Discussant at PSA Conference, in Mason and Russell, op. cit. 28 This speech delivered in 1976 was a milestone in the ideological change which afflicted the government of James Callaghan. 29 R. Taylor, ‘Manpower’s mounting millions’, Management Today, November 1983, pp. 84–9. 30 The Economist, 16 March 1983 (settlement). 31 J. Rees and C. Atkinson, Youth Employment and State Intervention, London, 1982, pp. 60–2.

Notes 32 33 34 35 36 37 38

233

MSC, Youth Task Group Report, 1982, p. 5. ibid. Interview shown on Yorkshire TV, April 1984. Local authority education committee chairman in conversation with the author. In conversation with the author. The Guardian, 19 April 1988. J. Johnston, ‘Manpower policy: pragmatism or principles?’, Royal Bank of Scotland Review, no. 155, September 1987. 39 MSC, Labour Market Quarterly Report, September 1987. 40 TEC Director, no. 4, December 1990, pp. 24–5. 41 R. Dale, The TVEI Story, Milton Keynes, Open University Press, 1990, p. 11. 42 ibid., p. 169. 43 D. Finn, ‘YTS: the jewel in the crown’, in C. Benn and J. Fairley, op. cit., p. 54. 44 In conversation with the author. 45 MSC, The Development of the YTS, 1985, passim. 46 MSC and National Economic Development Office (NEDO), Competence and Competition, 1984, passim. 47 See the criticisms in Benn and Fairley, op. cit., and in D. Gleeson, The Paradox of Training: Making Progress Out of the Crisis, Milton Keynes, Open University, 1989, pp. 22–7. 48 Sir Geoffrey Holland in conversation with the author. 49 D. Walker, Contemporary Record, vol. 2, no. 2, Summer 1988, p. 41. 50 A. Brown and J. Fairley, ‘Youth training’, Contemporary Record, vol. 2, no. 4, Winter 1988, p. 25. 51 P. Riddell, The Thatcher Government, Oxford, Martin Robertson, 1983, p. 43. 52 ibid., p. 50. 53 Implied in various NEDO papers: for example, 80/75 and 80/71; and MSC papers, for example, 81/1G. 54 P. Lewis, ‘YTS or else?’, New Society, 28 August 1987, p. 16. 55 Tebbitt, op. cit., p. 180. 56 ibid. 57 MSC, A Progress Report on YTS, 1985. 58 MSC, Training for Skills, 1985. 59 MSC, The Development of the YTS, 1985, p. 2. 60 ibid., p. 7. 61 ibid., p. 8. 62 MSC, Review of the YTS, 1985. 63 In conversation with the author. 64 MSC, Labour Market Quarterly Report, para. 1.1. 65 MSC, Corporate Plan, 1984–8, p. 8. 66 MSC officials in conversation. 67 Alan Rogers in conversation with the author. 68 TUC, Annual Report, 1984–5, p. 62. 69 ibid., p. 66. 70 ibid., p. 67. 71 Figures provided in March 1988 by a leading YTS official at the MSC. 72 The Guardian, 12 April 1988. 73 MSC, YTS Progress Report: Training for Skills, 1987, p. 8. 74 ibid., p. 9.

234 75 76 77 78

Notes

ibid., p. 10. ibid., p. 11. ibid., p. 12. MSC, Training for Skills: Quality Development Priorities in YTS, July 1987, p. 2. 79 ibid., p. 5. 80 ibid., p. 6. 81 P. Chapman and M. Tooze, ‘Some economic implications of the Youth Training Scheme’, in The Royal Bank of Scotland Review, no. 155, September 1987, p. 17. 82 ibid., p. 22. 83 ibid. 84 R. Taylor, op. cit. 85 Arguments fully developed in Benn and Fairley, op. cit. 86 A. Watts, Education, Unemployment and the Future of Work, Milton Keynes, Open University Press, 1983, p. 27. 87 T. Johnston, ‘Manpower policy – pragmatism or principles?’, The Royal Bank of Scotland Review, no. 155, September 1987, p. 15. 88 ibid. 89 DE, Employment News, September 1987. 90 ibid. 91 The Guardian, 2 November 1988. 92 The Guardian, 29 November 1988. 93 Report on Radio 4, 11 March 1990. 94 DE, TEC Director, no. 4. 95 P. Ainley and M. Corney, Training for the Future: The Rise and Fall of the MSC, London, Cassell, 1990, p. 59. 96 Daily Telegraph, 19 March 1985. 97 A. Thompson and H. Rosenberg, A User’s Guide to the MSC, London, Routledge & Kegan Paul, 1986, p. 9. 98 ibid., p. 10. 99 MSC, Annual Report, 1986–7, and quoted in Thompson and Rosenberg, op. cit., p. 16. 100 Thompson and Rosenberg, op. cit., p. 17. 101 ibid., p. 22. 102 MSC, No Barriers Here, 1983. 103 MSC, Code of Good Practice on the Employment of Disabled People, October 1984. 104 MSC, Management Extension Programme June 1981. 105 MSC, An Introduction to Information Technology, May 1985. 106 MSC, The Enterprise Allowance Scheme: A Guide, 1984. 107 MSC, Local Grants to Employers, 1985. 108 K. Walsh et al., The UK Market, London, 1986, passim. 109 ibid., p. 227. 110 Conversations with MSC research officers. 111 Ainley and Corney, op. cit., pp. 74–5.

Notes

235

4 AFTER THE MSC: FROM TRAINING COMMISSION (TC) TO TRAINING AGENCY (TA), 1987 TO 1990 1 2 3 4 5

Department of Employment, Training for the Future, HMSO, 1972, passim. DE, Employment News, September 1987. Tempo, October 1987, p. 1. Discussion with MSC officials. R. Harris, Competition and the Corporate Society: British Conservatives, the State and Industry, London, Methuen, 1972, p. 77. 6 P. Hennessy, Whitehall, London, Fontana, 1990, p. 622. 7 The Guardian, 17 February 1988. 8 ibid. 9 TEC Director, no. 4, p. 15. 10 MSC, Annual Report, 1987, Chairman’s Foreword. 11 Conversations with officials. 12 In conversation. 13 M. Seliger, Ideology and Politics, London, Allen & Unwin, 1975, p. 120. 14 Tempo, November 1987. 15 Ainley and Corney, Training for the Future: The Rise and Fall of the MSC, London, Cassell, p. 107. 16 The Observer, 10 April 1988. 17 Focus on Training, May 1987. 18 Summary and Conclusions of National Audit Office investigation of the MSC’s Adult Training Strategy (ATS), pp. 6–7. 19 ibid., p. 8, but also Sixth Report of the House of Commons Public Accounts Committee, HC 301, 1975–6. 20 This analysis is based upon discussions with adult educators and MSC officials and summarizes arguments fully developed in Brendan Evans, Radical Adult Education: A Political Critique, London, Croom Helm, 1987, chapter 1. 21 A. Thompson and H. Rosenberg, A User’s Guide to the MSC, London, Routledge & Kegan Paul, 1986, p. 22. 22 ibid., p. 203. 23 ibid., p. 250. 24 ibid., p. 115. 25 DE, Summary of National Audit Office Report, undated, p. 2. 26 ibid., p. 2. 27 ibid., p. 24. 28 ibid., p. 3. 29 ibid., p. 18. 30 House of Commons, Second Report of the Employment Committee, 1983–4; and written memorandum to committee meeting. 31 Ron Leighton MP to David Young, MSC chairman, 21 March 1984. 32 House of Commons, Second Report of the Employment Committee, 1983–4, p. ix. 33 Newsnight, 14 April 1986. 34 House of Commons, Third Report of the Employment Committee, 1985–6, pp. vi–vii. 35 National Audit Office Report, 1987, p. 5. 36 Training and Development, vol. 6, no. 8, December 1987, p. 6. 37 MSC, The New Job Training Scheme, publicity material.

236 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79

Notes B. Hogwood and L. Gunn, Policy Analysis for the Real World, Oxford, Oxford University Press, 1989, p. 208. Training for Employment, (Cmnd. 316). C. Lupton, ‘The politics of ET’, Talking Politics, vol. 1, no. 2, Winter 1988/89, p. 63. Discussions with relevant MSC officials. A. Cawson, ‘Pluralism, capitalism and the role of the state’, Government and Opposition, 13, p. 2. Adult Education, vol. 61, no. 1, 1988, commentary. ibid. ibid. Adult Education, vol. 60, no. 4, 1987, commentary. Training Agency (TA), Towards A New Adult Training Programme, January 1988. ibid. Information compiled from MSC and TA publications, and from briefings at the MSC. NATFHE Journal, March 1988, vol. 13, no. 2, p. 23. C. Lupton, op. cit., p. 65. In conversation with the author. The Guardian, 15 April 1988. The Guardian, 24 May 1988. The Guardian, 12 May 1988. The Guardian, 24 May 1988. The Guardian, 15 April 1988. ibid. The Independent, 2 May 1988. ibid. The Guardian, 20 April 1988. NATFHE Journal, July 1988, editorial comment. New Statesman and Society, 8 July 1988. The Guardian, 26 August 1988. The Guardian, 4 September 1988. The Guardian, 24 March 1989. A local investigation by the author. ibid. Financial Times, 9 November 1990. Financial Times, 22 January 1991. The Independent, 9 January 1991. Financial Times, 9 November 1991. Financial Times, 22 January 1991. MSC, Labour Market Quarterly, September 1987. MSC, Work-Related NAFE: Supplementary Guidance for the 1989–90 Planning Round, p. 8. Further Education Unit (FEU), Quarterly in NAFE, p. 2. Internal letter to regional officials. The Times Educational Supplement, 17 July 1987, and 15 April 1988. Ainley and Corney, op. cit.

Notes 80 81 82 83 84 85 86 87 88 89

237

C. Lamb, ‘From liberal to techno-corporatism: the role of expert intermediation and the global function of capital’ paper delivered to the Political Studies Association Conference, April 1984. ibid., p. 19. ibid., p. 23. D. Robinson (ed.), Local Labour Markets and Wage Structures, London, Gower, 1970, p. 50. Confederation of British Industries (CBI), Towards A Skills Revolution, London, 1989, p. 7. ibid., p. 9. ibid., p. 22. ibid., p. 24. ibid., p. 28. ibid., p. 29.

5 THE RISE OF THE TRAINING AND ENTERPRISE COUNCILS (TECs) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

J. Rosenau, ‘Towards the study of national–international linkages’, in Linkage Politics, New York, The Free Press, pp. 45–6. B. Hogwood and L. Gunn, Policy Analysis for the Real World, Oxford, Oxford University Press, 1989, p. 263. B. Hogwood and B. Peters, The Pathology of Public Policy, Oxford, Clarendon Press, 1985, p. 159. J. Bulpitt, ‘The discipline of the new democracy: Mrs Thatcher’s domestic statecraft’, Political Studies, vol. 34, no. 1, March 1986, p. 27. Times Higher Educational Supplement, 24 August 1990. Tempo, October 1988. Times Higher Educational Supplement, 5 February 1990. Times Higher Educational Supplement, 15 April 1988. Arguments advanced by, for example, R. Gleeson, The Paradox of Training, Milton Keynes, Open University Press, 1989, p. 207. Employment for the 1990s, (Cmnd. 540), London, HMSO, preface. ibid., p. 8. ibid., p. 20. ibid., p. 19. ibid., p. 26. In conversation with the author. Employment for the 1990s, (Cmnd. 540), p. 28. ibid., p. 29. ibid., pp. 29–30. ibid., p. 32. Sir Geoffrey Holland in conversation with the author. Hogwood and Peters, op. cit., p. 10. CBI, World Class Targets, June 1991, p. 12. Employment for the 1990s, (Cmnd. 540), p. 33. ibid., pp. 34–6. ibid., pp. 36–8. ibid., p. 40.

238 27 28 29 30 31 32

Notes

In conversation. ibid., p. 40. ibid. In conversation with TEC officials. Financial Times, 25 June 1990. M. Fass and R. Scothorne, The Vital Economy: Integrating Training and Enterprise, Edinburgh, Abbeystrand, 1990, p. 4. 33 ibid., p. 16. 34 ibid., p. 19. 35 Hansard, 5 December 1988, col. 27. 36 Financial Times, 5 December 1988. 37 ibid. 38 ibid. 39 Financial Times, 9 May 1990. 40 ibid. 41 In conversation with the author. 42 In conversation with the author. 43 Evans, op. cit., chapter 2. 44 Lecture to Huddersfield Polytechnic Politics Society, 16 March 1990. 45 Training and Enterprise Councils: A Prospectus for the 1990s, foreword. 46 ibid. 47 ibid., p. 13. 48 Financial Times, 31 May 1990. 49 Yorkshire Post, 21 March 1990. 50 Financial Times, 31 May 1990. 51 B. Evans, Radical Adult Education: A Political Critique, London, Croom Helm, pp. 12–13. 52 H. Young and A. Sloman, But Chancellor, London, BBC Publications, 1984, p. 42. 53 ibid., p. 43. 54 C. Thain, ‘The Treasury: its evolving role since 1970’, Contemporary Record, vol. 3, no. 4 April 1990, pp. 17–19. 55 ibid. 56 A. Flynn, A. Gray and W. Jenkins, ‘The next steps and the management of government’, Parliamentary Affairs, vol. 43, no. 2, April 1990, pp. 159–60. 57 Sir Peter Middleton’s evidence to the Treasury and Civil Service Committee in Report 8, 1988, HC 494-117. 58 G. Fry, A. Flynn, A. Gray, W. Jenkins and B. Rutherford, ‘Improving public sector management’, in Public Administration, vol. 66, Winter 1988, pp. 431–2. 59 K. Theakston, ‘Labour, Thatcher and the future of the Civil Service’, Public Policy and Administration, vol. 5, no. 1, Spring 1990, p. 51. 60 Financial Times, 9 May 1990. 61 P. Dunleavy, H. Drucker, A. Gunble and G. Peele, Developments in British Politics, London, Macmillan, 1990, p. 113. 62 ibid., pp. 113–14. 63 Flynn et al., op. cit., p. 160. 64 P. Hennessy, Whitehall, London, Fontana, 1990, p. 622. 65 Flynn et al., op. cit., p. 172. 66 ibid., p. 176.

Notes 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104

239

Analysis, Radio 4, 18 July 1990. Labour Party News, July 1990, No. 20, p. 14. Young and Sloman, op. cit., p. 40. Sir G. Vickers, The Art of Judgment, London, Chapman and Hall, 1965, discussed and applied in B. Evans, ‘Technical education, pressure groups and the 1944 Act’, History of Education, vol. 11, no. 1, 1982, pp. 45–55. In conversation. Flynn et al., op. cit., p. 176. Editorial, Public Administration, vol. 67, 1989, p. 3. P. Lawless, ‘British inner urban policy post 1979: a critique’, in Policy and Politics, vol. 16, no. 4, October 1988, p. 267. Editorial Public Administration, vol. 67, op. cit. Calderdale and Kirklees Training and Enterprise Council (TEC) Economic Excellence by Investment in People, Calderdale and Kirklees TEC, publicity brochure, April 1990. The Economist, 29 June 1990. In conversation with TEC officials. B. Evans and A. Taylor, ‘The rise and fall of two-party electoral cooperation’, Political Studies, vol. 32, no. 2, June 1984, pp. 257–72. Events pieced together after conversation with participants. R. Rhodes, The National World of Local Government, London, Allen & Unwin, p. 164. M. Laffin, Professionalism and Policy: The Role of the Central-Local Relationship, Aldershot, Gower, 1986, p. 12. The Leeds Journal, April 1990. Calder News, May 1990. Economic Excellence by Investment in People, Calderdale and Kirklees TEC Corporate Plan, 1990–93, p. 70. ibid., p. 16. ibid., pp. 16–24. ibid., p. 27. ibid., p. 35. Leading officials in conversation with the author. See both What Is An Investor in People? and Investors in People: 10 Good Answers to 10 Pressing Questions, Calderdale and Kirklees TEC, September 1991 and December 1990. Calderdale Records of Achievement, Calderdale and Kirklees TEC brochure, 1991. Conversations with participants. A Guide to the TEC’s Advertising Campaign, DE, 1991, p. 1. TEC Director, 4 July 1990, p. 5. ibid., p. 19. TEC Director, 5 September 1990, p. 13. ibid., p. 14. DE, Discussion Document. TEC Director, 4, op. cit., pp. 30–1. TEC Director, 5, pp. 28–9. TEC Director, 8, p. 16. TEC Conference Report, 1990, pp. 1–10. ibid., pp. 13–14.

240

Notes

105 106 107 108 109 110 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133 134 135 136 137 138

ibid., p. 16. ibid., p. 52. ibid. ibid., p. 71. The Economist, 6 April 1991. In conversation with the author. The Guardian, 28 May 1991. ibid. The Guardian, 18 March 1991. The Independent, 1 January 1991. Financial Times, 18 February 1991. In conversation. Sir John Cassells, formerly of the MSC, in correspondence with the author. Financial Times, 25 March 1991. CBI, World Class Targets, June 1991. The Guardian, 21 February 1991. A Guide to the TEC’s Advertising Campaign, DE, 1991, p. 1. Financial Times, 6 February 1991. ibid. Financial Times, 9 January 1991. Financial Times, 25 January 1991. DE press notice, 10 October 1990. ibid. Financial Times, 16 September 1991. The Guardian, 20 April 1990. Financial Times, 25 June 1990. Fass and Scothorne, op. cit., passim. Financial Times, April 1991. Financial Times, 3 July 1991. ibid. Also The Guardian, 29 April 1992. Financial Times, 5 July 1991. ibid. BBC TV News, 10 July 1991. Employment Committee of House of Commons, Future Prospects for Levels of Employment and Unemployment, 15 May 1991, p. vi. ibid., p. 7. ibid., p. 41. ibid., p. 49. ibid., p. vii. ibid. TEC Director, 8, p. 17. Financial Times, 5 May 1991. J. Marquand, ‘Education, Decentralisation and Accountability’, Policy Studies, vol. 13, no. 1, Spring 1992, p. 32.

139 140 141 142 143 144 145 146

Notes

241

6 THE MSC, THE TECs, THE TRAINING MARKETS AND PUBLIC POLICY THEORY 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34

P. Dutton, ‘YTS – training for the future’, Public Administration, vol. 62, no. 4, 1984, pp. 483–94. Newsnight, 20 May 1990. NATFHE Journal, vol. 15, no. 6, December 1990, p. 31. Sir W. Beveridge, Unemployment, London, Longmans, 1909, p. 233. J. Wellens, The Training Revolution: From Shopfloor to Boardroom, London, Evans, 1963, p. 20. P. Ainley and M. Corney, Training for the Future: The Rise and Fall of the MSC, Cassell, 1990, p. 131. T. Byrne and C. Padfield, Social Services Made Simple, W.H. Allen, 1986, p. 223. T. Smith, ‘The British constitution: unwritten and unrivalled’, in F. Hayward and P. Norton, The Political Science of British Politics, London, Wheatsheaf, 1986, p. 52. Ainley and Corney, op. cit., p. 138. Department of Employment, Gazette, July 1980. J. Lockwood, ‘The MSC: an opportunity missed’, Industrial and Commercial Training, pp. 467–71. See both A New Training Initiative: A Consultative Document and A New Training Initiative: An Agenda for Action (Cmnd. 8455). NATFHE Journal, vol. 15, no. 6, December 1990, p. 31. J. Prior, A Balance of Power, London, Hamish Hamilton, 1986, p. 141. J. Sheldrake and S. Vickerstaff, A History of Industrial Training, London, Avebury, 1987, p. 64. C. Hayes, Training for Skill Ownership in the YTS, MSC, Brighton, 1983, p. 55. Ainley and Corney, op. cit., p. 61. S. Savage and L. Robbins, Public Policy Under Thatcher, London, Macmillan, 1990, p. 53. Ainley and Corney, op. cit., p. 81. MSC, Focus on Training, May 1988. Training Survey, 1985, para. 2. ibid., pp. 94–5. Weekend World, December 1986. Hansard, 13 November 1990, col. 442. Ainley and Corney, op. cit., p. 99 Speech to Young Conservatives, Observer, 10 February 1991; and his personal presentation of White Papers on 21 May 1991. Ainley and Corney, op. cit., p. 106. Sir J. Cassells in correspondence. The Guardian, 6 September 1991. TEC Prospectus, 1989, p. 4. ITV News, 11 February 1991. Speakers at a panel of the Institute of Contemporary History, March 1990, London School of Economics. Speech by D. Walker at Institute of Contemporary History Seminar (as above). Unpublished paper, quoted in Ainley and Corney, op. cit., p. 36.

242 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66

Notes The Economist, 6 April 1991. The Guardian, 3 August 1991. The Independent, 7 January 1990. The Guardian, 14 September 1990. MSC, Labour Market Quarterly, August 1990. M. McLeish MP, ‘Who pays for skills?’, labour market briefing, House of Commons, 19 December 1990. The Guardian, 22 December 1990. N. Willis, ‘A worker’s right to train’, in National Westminster Bank Quarterly Review, February 1989, p. 14. ibid., p. 18. Interview with the Rt. Hon. Neil Kinnock, MP, Leader of the Opposition, Walden, 28 April 1991, London Weekend Television. Times Higher Educational Supplement, 24 August 1990. House of Lords Select Committee on the European Community, Vocational Training and Retraining, September 1990. Financial Times, 13 September 1990. TEC Conference Report, October 1990, p. 4. A. Brown, Labour Market Policy in Britain: A Critical View, Waverley Papers, Edinburgh University Politics Series, 1988, p. 2. G. Hodgson, Labour at the Crossroads, Oxford, Martin Robertson, 1981, passim. Brown, op. cit., p. 10. J. Craigen, ‘Britain’s training mirage’, paper at conference on The Politics of Industrial Training, Edinburgh, 11 June 1982. DE, Employment for the 1990s, HMSO, 1988, p. 14. Times Higher Educational Supplement, 12 April 1991. D. Gleeson, Training and Its Alternatives, Milton Keynes, Open University Press, 1990, passim. Robert Aitken, ‘MSC, TVEI and education in perspectives’, Political Quarterly, vol. 57, no. 3, July 1986, p. 231. Brown, op. cit., p. 25. A. Gamble, ‘This lady’s not for turning: Thatcherism Mark 3’, Marxism Today, June 1984. DE, Employment: The Challenge for the Nation (Cmnd. 9474), HMSO, 1985. National Audit Offices, Department of Employment and Manpower Services Commission: Adult Training Strategy, HMSO, 23 January 1987. H. Heclo and A. Wildavsky, The Private Government of Public Money, London, Macmillan, 1981, passim. C. Moore, ‘The private government of public money’, Politics 12(1) April 1992. See Chandler and Wallace’s article in Gleeson, op. cit. A. Downs, ‘Up and down with ecology: the issue–attention cycle’, Public Interest, no. 28, pp. 38–50. R. James, Return to Reason: Popper’s Thought in Public Life, Somerset, Open Books, 1980. G. Dror, Policy-Making Under Adversity, New Brunswick, Transaction, 1986, See also J. Pratt and S. Silverman, Responding to Constraint: Policy and Manpower in Higher Education, Milton Keynes, Open University Press, 1988, p. 116.

Notes 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92

243

Alternatives fully discussed in B. Evans, Radical Adult Education: A Political Critique, London, Croom Helm, 1987, chapter 2. T. Richardson and A. Jordan, Governing Under Pressure, London, Martin Robertson, 1979, p. 43. ibid., p. 74. J. Benson, ‘Interorganisational networks and policy sectors’, in D. Rogers and D. Whelter (eds) Interorganisational Co-ordination, Iowa, Iowa State University Press, 1983, p. 3. R. Manser, Teachers and Politics: The Role of the National Union of Teachers in the Making of National Education Policy in England and Wales since 1944, Manchester, Manchester University Press, 1970, p. 10. Evans, op. cit., conclusion. J. Moon and J. Richardson, Unemployment in the United Kingdom, London, Gower, 1985, p. 93. D. Marsh, ‘Is death preferable to dishonour? The MSC and youth unemployment policy’, paper presented at University of Essex Conference, July 1989, p. 1. ibid., pp. 3–5. ibid., p. 31. Financial Times, 16 April 1991. Marsh, op. cit., appendix. R. Rhodes and D. Marsh, ‘New directions in the study of policy networks’, European Journal of Political Research, 1991, p. 30. ibid., p. 4. W. Grant, W. Paterson and Colin Whitston, Government and the Chemical Industry, Oxford, Clarendon Press, p. 11. ibid., p. 14. Marsh, op. cit., p. 36. Richardson and Jordan, op. cit., p. 74. Evans, op. cit., chapter 2. Rhodes and Marsh, op. cit., p. 18. Sir G. Vickers, The Art of Judgment, London, Chapman and Hall, 1965, passim. Rhodes and Marsh, op. cit., p. 20. Discussed in P. Self, Administrative Theories and Politics, Allen & Unwin, 1977, passim. B.W. Hogwood and L.A. Gunn, Policy Analysis for the Real World, Oxford, OUP, 1984, chapter 11; and C. Ham and M. Hill, The Policy Process in the Modern Capitalist State, Hemel Hempstead, Harvester, chapter 6. Report of a leaked letter from David Mellor, Channel 4 News, 23 September 1991. TEC Report (the journal of the Calderdale and Kirklees Training and Enterprise Council) 1991, p. 8.

Suggested further reading

Ainley, P. and Corney, M. (1990) Training for the Future: The Rise and Fall of the MSC, London, Cassell. Benn, C. and Fairley, J. (1986) Challenging the MSC, London, Pluto. Birch, W. (1988) The Challenge to Higher Education, Milton Keynes, Open University Press. Dale, R. et al. (1990) The TVEI Story, Milton Keynes, Open University. Evans, B. (1987) Radical Adult Education: A Political Critique, London, Croom Helm. Fass, M. and Scothorne, R. (1990) The Vital Economy: Integrating Training and Enterprise, Edinburgh, Abbeystrand. Gleeson, D. (1985) Youth Training and the Search for Work, London, Routledge & Kegan Paul. —— (1989) The Paradox of Training: Making Progress Out of a Crisis, Milton Keynes, Open University. Hennessy, P. (1988) Whitehall, London, Fontana. Middlemas, K. (1979) The Politics of Industrial Society, London, MacMillan. Prior, J. (1981) A Balance of Power, London, Hamish Hamilton. Rees, T. and Atkinson, P. (1982) Youth Employment and State Intervention, London, Routledge. Robinson, D. (1970) Local Labour Markets and Wage Structures, London, Gower. Savage, S. and Robins, L. (1990) Public Policy Under Thatcher, London, MacMillan. Sheldrake, J. and Vickerstaff, S. (1987) A History of Industrial Training, London, Abbeystrand. Tebbitt, N. (1988) Upwardly Mobile, London, Weidenfeld & Nicolson, 1988. Thompson, A. and Rosenberg, H. (1986) A User’s Guide to the MSC, London, Routledge & Kegan Paul. Vickerstaff, S. (1974) The Limits of Corporatism: The British Experience, unpublished PhD thesis, University of Leeds. Watts, A.G. (1983) Education, Unemployment and the Future of Work, Milton Keynes, Open University. Confederation of British Industry (1989) Towards a Skills Revolution, London, CBI. Department of Employment (1972) Training for the Future, London. —— (1984) Training and Jobs, London. —— (1988) Training and Employment, London. H.M. Government (1971) (White Paper) Small Firms (Cmnd 2764). —— (1981) (White Paper) The Youth Training Scheme (Cmnd 8445). —— (1985a) (Green Paper) Public Expenditure: The Next Ten Years.

Further reading

245

—— (1985b) (White Paper) Employment: The Challenge for the Nation (Cmnd 9474). —— (1985c) Vocational Education and Training for Young People (report by Comptroller and Auditor General) (Cmnd 9823). —— (1988a) Training for Employment (Cmnd 316). —— (1988b) (White Paper) Employment for the 1990s (Cmnd 540). Manpower Services Commission, Annual Reports, 1975–1987. —— (1975) Vocational Preparation for Young People, London. —— (1976) Towards A Comprehensive Manpower Policy, Sheffield. —— (1977a) Training for Skills, Sheffield. —— (1977b) Young People and Work, Sheffield. —— (1978) Review and Plan, Sheffield. —— (1980) Outlook on Training, a review of the 1973 Employment and Training Act, Sheffield. —— (1981a) A New Training Initiative: A Consultative Document, Sheffield. —— (1981b) A New Training Initiative: An Agenda for Action, Sheffield. —— (1984a) Instructional Guide to Social and Life Skills, Sheffield. —— (1984b) Report on YTS Leavers Survey, Sheffield. —— (with NEDC) (1985a) Competence and Competition, London. —— Development of the Youth Training Scheme, Sheffield. —— (with NEDC) (1985b) A Challenge to Complacency, Sheffield, 1986. Training Services Agency (1973) Five Year Plan, Sheffield. —— Five Year Plan, Sheffield, 1974. —— TSA Five Year Plan Review, Sheffield, 1976. —— Young People and Work, Sheffield, 1977.

Index

The following abbreviations are used in subheadings: ET (Employment Training); MSC (Manpower Services Commission); TECs (training and enterprise councils); TOPS (Training Opportunities Scheme); YOPS (Youth Opportunities Scheme); and YTS (Youth Training Scheme) Access to Information Technology courses 86 Adult Education 106–7 Adult Literacy and Basic Skills Unit (ALBSU) 98 adult training 38, 39, 44–5, 96–105 Adult Training Strategy (ATS) 45, 51, 96–105, 194 Advisory, Conciliation and Arbitration Service (ACAS) 59 Ainley, P. and Corney, M. 82, 94–5, 122, 191–2, 196–9 Allen, Oswald 4 American models: private industry councils (PICs) see private industry councils; Workfare 104, 106, 112 apprenticeships: criticism of 69–70; growth under industrial training boards 9; history 2–3; post-war 5; reform 39, 44, 45, 51; responsibility for funding 42–3 approved training agencies (ATAs) 105 approved training organizations (ATOs) 72–4; ownership of YTS 76

Arbetsmarknadsstyrelsen (ABS, Swedish Labour Market Board) 12 area manpower boards 59; change to labour advisory bodies 96 Association of County Councils 56–7 Association of Municipal Authorities (AMA) 56–7, 113, 115, 117 Baker, Kenneth 95, 199 Barnes, Sir Dennis 20 Beavis, Simon 183 benefits: ET benefit-plus arrangement 108, 110; Jobcentres 90–2; payment combined with employment service 12–13; period of unconditional 113 Benson, J.K. 215 Betts, Derek 121 Beveridge, William 113, 191 Bevin, Ernest 5 Biffen, John 14 Blackstone, Baroness Tessa 94 Blair, Tony 119, 183–4, 185 Board of Education 4 Bolton Committee of Enquiry into Small Firms 8 British Association of Commercial and Industrial Education (BACIE) 4

Index British Employers Federation 7 Brown, Alice 66, 206, 208, 209 Bryan, Sir Paul 14 Bulpitt, J.G. 129 Business Growth Training (BGT) 142 Butler, R.A. 4 Butler, Sir Robin 153 Buxton, James 143, 183 Byrne, T. and Padfield. C. 192 Calder News 160 Calderdale and Kirklees TEC 157–68 Callaghan, James 23, 31, 61 Careers and Occupational Information Centre 95 Careership 124–6 Carr, Robert 13 Cassels, Sir John 22, 203 Cawson, A. 106 CBI see Confederation of British Industry Central Policy Review Staff (CPRS): Education Training and Industrial Performance (1980) 47, 51, 54; predictions on unemployment 67 Central Training Council (CTC) 8 Certificate in Vocational Preparation and Education (CVPE) 61 Challenge to Complacency, A (Coopers & Lybrand, 1985) 98, 135, 196–7 Chapman, P. and Tooze, M. 77–8 city technology colleges (CTCs) 198–9 Civil Servants: government displeasure 152–3; as policy makers 214 Code of Good Practice on the Employment of Disabled People (MSC) 86 Coffield, Frank 203 Cohort Study 74–5 Community Industry initiative 30 Community Programme (CP) 97, 100; eligibility 102 Competence and Competition (MSC/ NEDO, 1985) 2, 65, 98, 135 compulsion: on employers to provide training 206; ET 112–13; YTS 67–8, 71 Computer Assisted Local Labourmarket Information (CALLMI) 101, 122, 222

247

Confederation of British Industry (CBI): ambivalence towards Training for the Future 14–15; response to Industrial Training Boards 8, 9; Towards a Skill Revolution (1989) 124–6; TECs 187; training targets 178–9 Coopers & Lybrand 98, 135, 196–7 corporatism 57–60, 211–12 counter-cyclical spending 10 Craigen, Jim 208 credits see training credits crisis management: inter-war 3; MSC (1974–79) 25; YOPS 30–1, 45 Dale, Roger 63 Davies, Garfield 116 Dawe, Roger 94, 95, 133 day-release for apprentices 5 deadweight factor 79–80, 101 Department of Education and Science: Certificate in Vocational Preparation and Education (CVPE) 61; and Department of Employment 56; Pickup scheme 100 Department of Employment: Community Industry initiative 30; control over MSC 17; employment services unit 92; hiving-off 13; People and Jobs (1971) 12; support for Technical and Vocational Education Initiative (TVEI) 63; Training Enterprise and Employment Division (TEED) 96, 177; Training for the Future (1972) 11–15; Training for Jobs (1984) 54, 56–7, 97, 120, 195; victory over Department of Education and Science 56 Department of Health and Social Security (DHSS) 94 disabled see equal opportunities Downing Street Policy Unit 67 Downs, A. 213 Dror, G. 214 Dunleavy, Patrick 152 Eccles, Sir David 5

248

Index

Economist, The 205 Edmonds, John 116 Education Act (1988) 199 education system: criticism by James Callaghan 23, 31, 61; Education Act (1988) 199; introduction of MSC into 52; reform 4, 198–200; see also Department of Education and Science; further education colleges Education, Training and Industrial Performance (CPRS, 1980) 47, 51, 54 Education and Training for Young People (HM Government, 1985) 69 Efficiency Unit 151, 152–3 Eggar, Timothy 150, 161 Employment for the 1990s (HM Government, 1988) 121, 201, 134– 47 employment services: combination with payment of benefits 12–13; transfer to MSC 92–4 Employment Services Agency (ESA) 27–31; becomes Employment Services Division 22; creation of 15–16, 19–20; Jobcentre programme 27–8; PER agency 27–8 Employment Services Division (ESD) 22 Employment Training (ET) 97, 105– 20, 200; advertising 107; benefitplus arrangement 108, 110; compulsion 112–13; eligibility rules 106, 108; Exit 108; funding 110, 174–5; and the labour movement 111, 112–20; low take-up rate 117–18; and National Association of Teachers in Further and Higher Education 115; problems 108–9; provision by TECs 141; rescue by TECs 118; and Restart 107, 113; training agents 107, 108, 109; training managers 107, 108, 109; and Trades Union Congress 96, 111, 113–17, 131–2, 200–201 Employment and Training Act (1973) 16–17, 20, 191 Enterprise Allowance Scheme 86–7, 95, 195; provision by TECs 141

enterprise culture 127, 132–3, 155 Enterprise in Higher Education (EHE) initiative 95, 198 equal opportunities 85–6; MSC Unit 98; and TECs 169 ET see Employment Training ethnic minorities see equal opportunities Etzioni, A. 223 European market 136 European Social Fund 34 Eversley, J. 54, 55–6 Fairley, John 66 Fass, M. and Scothorne, R. 143, 183 financial management information (FMI) 150 Financial Times, The 144–6, 184 Fletcher, Neil 113 Flynn, A. 154 Focus on Training 84 Fogden, Mike 93 Foot, Michael 22 Fowler, Norman 90–1, 94, 104, 113–13, 116–19, 127–8, 131–3, 142–3, 147–8 Fullick, Leisha 52 further education colleges (FECs): attacked 57; day-release for apprentices 5; funding 56; removal from local authority control 85; TOPS courses 37 Further Education Unit (FEU) 120, 195 Gamble, Andrew 209–10 Gartland, Tony 158 Gill, Ken 54 Gleeson, Denis 209 Gorst, John 43 Gould, Bryan 225 government training centres (GTCs) 3–4, 8 Graham, Alastair 149, 226 Graham, Ken 26, 38 Grant, Olivia 181 Grant, Wyn 218–19 Grantham, Roy 116 Guardian, The 115, 118, 175

Index Gunter, Ray 7 Gwyther, David 172 Hall, Ernest 158 Hammond, Eric 116 health and safety 74, 80 Heath, Edward 10, 191 Heath government: Industrial Training Boards 9–12; interventionism 12, 13–14 Heclo, H. 211, 223 higher education institutions 95, 198; funding 56–7, 84–5; see also further education colleges Hillgate Group 134, 198–9 Hogwood, B. and Peters, H. 128–9 Holland, Sir Geoffrey: Special Temporary Employment Programme 193; Technical and Vocational Education Initiative 199; Training Agency 133–4; Training Council 95–6; TECs 140– 1, 172–3, 175; YTS 66–7, 78, 137, 194 Hoskyns, John 67 House of Commons Employment Committee 24–5, 39–43; adult training 102–3; TECs 185–7; YOPs 42 Howard, Michael: ET 119; TECs 143, 145, 149, 171–2, 174, 178, 185; Youth Training 81 Howe, Geoffrey 67 Howells, David 13–14, 20, 24, 28, 36 Hughes, Bill 132–3 Hughes, James 10 Ibbs, Sir Robin 92, 138, 151 incrementalism 220–5 Industrial Training: Government Proposals (Ministry of Labour, 1962) 7 Industrial Training Act: (1963) 8; (1964) 1 Industrial Training Boards (ITBs): Confederation of British Industry and 8, 9; decline 10–12; establishment 191; government grants 34; Heath government 9–12; large scale abolition 45; merits 9;

249

quality of training 9; setting up 1, 8; unpopularity with employers 8– 9 industrial training organizations (ITOs) 178, 181 information technology 123; Access to Information Technology courses 86 inner-city riots 45, 51, 64 Institute of Directors 185–6 Interrupted Apprenticeship Scheme (IAS) 3–4 interventionism: Heath Government 12, 13–14; Macmillan government 7 Investors in People initiative 139–40, 172 Jackson, Roy 116 James, R. 214 Jenkins, Kate 92 Job Creation Programme (JCP) 28 Job Training Scheme (JTS) 84, 97, 99 Jobcentres: opening 16; reuniting with unemployment benefit offices 90–2; services 27–8 Johnston, Dr. T. 79 Jordan, Bill 116 Joseph, Sir Keith 57, 60, 84, 147 junior instructional centres (JICs) 4 Kellner, Peter 114 Kinnock, Neil 113, 116 Kolberg, Bill 173 labour advisory bodies (LABs) 96 labour-market: dual 210; forecasting 35–6; Industrial Training Boards as scapegoat for difficulties 10–11; intelligence 100–101, 122–4, 210, 222; problems of 1990s 136–7; see also manpower planning Labour-market Information Board (LMIB) 122 Labour-Market Quarterly 62, 70, 205 Labour party: commitment to TECs 183–4; criticisms of TECs 144; modernization 112; response to ET 111, 112–20; training as poaching 225; training strategy 155–6; Who Pays for Skills? (1990) 205

250

Index

Laffin, M. 159 Lamb, C. 122 Lawson, Nigel 147 Leeds Journal 160 levy, training: administration by industrial training boards 8; Industrial Training Act (1963) 8; opposition of British Employers Federation 7 Lewis, Paul 67 Local Collaborative Projects 86 local consultancy grants (LCGs) 87 Local Education Authorities (LEAs): beneficiaries of TOPS schemes 37; as deliverers of new policies 52; disputes about funding of higher education 56–7, 84–5; management of Technical and Vocational Education Initiative 61–2; work-related non-advanced further education 120, 142 Local Grants to Employers 87 Local Labour-market Research Unit 122 local training grants (LTGs) 87 Lockwood, John 193 Lowry, Pat 59 Lupton, Carol 105–6, 112–13 MacGregor, John 171 Macmillan, Harold 6–7 Major, John 119–20, 149, 199 Management Extension Scheme 86 Management Today 47 Manpower Intelligence and Planning Division (MIOD) 22, 88 manpower planning: lack of national policy 11; role of MSC 35–6; and youth training 65; and YTS 77–8; see also labour-market Manpower Services Commission (MSC): accountability, internal 24–7, 39, 60; achievements and potential 202; activities in 1980s 82–7; adult training strategy 84, 96–105; advertising 25; agencies see Employment Services Agency, Training Services Agency; budgetary cuts 41–2, 44, 51; chairman’s management

committee 22; composition 15, 83–4; and Conservative Party 206–11; conversion to Training Commission 90, 94; Corporate Plan 22, 24, 39; critics 57–8; Crown status 17; demise of 121– 2; and Department of Employment 17; early expansion 191–2; EC funding 34, 83; emergence 12–17; Equal Opportunities Unit 98; expansion under Thatcher government 49– 50; finance 23–6, 34, 83; formal creation (1972) 15–16; gradualist training strategy 38; independence 26–7, 58; manpower planning role 35–6; A New Training Initiative (1981) 51; No Barriers Here 85; organizational transition 21–2; Outlook on Training (1980) 38–9, 44–5, 99; regional manpower service directors 23; Research Unit 87–8, 122–4; role 16–17; secretariat 20; special programmes 28–31; Special Programmes Division 30, 31; structure 19–23; surveys of YTS 74–5; Thatcherism and 24–5, 38– 45, 51–3; trade unions and 26, 47, 53–6; Towards A Comprehensive Manpower Planning Policy (1976) 20–2, 35; Training for Skills (1977) 33; Training for Vital Skills (1976) 32; transfer of employment services 92–4; use of external consultants 25; value for money 24; Young People and Work (1977) 30; Youth Task Group Report (1982) 61 Manzer, R.A. 215 Marsh, Dave 215–19 Mayhew, Ken 188 McCormack, K. 11 McGarvey, Danny 26 McGoughan, Jim 38 McLeish, Henry 175–6, 205 Meacher, Michael 115, 144 Mellor, David 226

Index Middleton, Sir Peter 150, 152 Ministry of Labour: Industrial Training; Government Proposals (1962) 7; inter-war promotion of training 3–5 mobility of labour 44, 110 Moore, C. 211–13 Morgan, Peter 186 Mortimer, Jim 58–9 MSC see Manpower Services Commission Munn, Sir James 94, 95 National Advisory Body 84 National Association of Teachers in Further and Higher Education (NATFHE) 56, 80; opposition to ET 115; response to Training for Employment 112 National Audit Office (NAO): attack on MSC 100–101; report 197 National Council for Vocational Qualifications (NCVQ) 76, 146, 178 National Curriculum 62 National Economic Development Council (NEDC) establishment 6 National Economic Development Office (NEDO) 2, 65, 98, 135 National Joint Advisory Council Training for Skill (1958) 5–6 National and Local Government Officers’ Association (NALGO) 115 National Priority Skills Scheme 101 National Training Task Force (NTTF) 138–9 National Vocational Qualifications 125–6, 178–9 New Job Training Scheme (NJTS) 95, 97, 102; deficiencies 104 New Training Initiative 38, 45, 49, 51, 193–4 New Training Initiative, A (MSC, 1981) 51 Next Steps, The 92, 152 Nicholls, Patrick 81 Nicholson, Sir Bryan 57, 93, 95, 121, 169, 196 No Barriers Here (MSC) 85

251

non-advanced further education (NAFE) 61, 120–22 Nott, John 45, 67 O’Brien, Sir Richard 20–22, 260–7, 29–30, 35, 41–5, 58, 68 Open Learning Programmes 86 Open Tech 39, 44–5, 99 Outlook on Training (MSC, 1980) 38–9, 44–5, 99 Owen, David 103 pay rates see wages People and Jobs (Department of Employment, 1971) 12 Philips, Melanie 114 Pickup scheme 100 policy implementation 57–60, 224 policy networks 214–20 Political Quarterly 209 Politics 211 Price, Chris 134–5 Prior, James 43–4, 45, 67, 194 private government of public money 211–14 private industry councils (PICs) 127– 8, 133; shortcomings 131; similarity to TECs 173 Professional and Executive Recruitment (PER): creation of 16; agency 27–8 Public Administration 157 public expenditure cuts 38 public policy theory 211–25 quangos 25, 153 rationalism 220–25 Read, Sir John 144 recession 204–5; training for economic recovery 34 regional manpower intelligence unit (RMIU) 88 regional manpower service directors (RMSDs) 23 residential instruction centres (RICs) 4 Restart initiative 92, 95, 104; and ET 107, 113 Rhodes, R. 159

252

Index

Rhodes, R. and Marsh, D. 218–22 Richardson, T. and Jordan, A. 214–15, 221 Richardson, T. and Moon, J. 215 Riddell, P. 67 Rogers, Alan 72–3 Rosenau, J.D. 128 scientific management 3 Scottish Enterprise Agency 132–3 Selsdon philosophy 14 Sheldrake, J. and Vickerstaff, S. 2 Short, Clare 56, 58, 62, 113 Simon, H.A. and Lindblom, C. 221 Skillcentres 101–2; competitive approach 140; TOPS schemes 36–7 skills-ladder theory, 174, 179 Skills Training Agency (STA) 101–2 Small Business Programmes 99 Smith, Trevor 192 Social Security Bill (1987) 71 social welfare policy 53 Special Temporary Employment Programmes (STEP) 30, 193 Spencer, Limbert 169 Stephenson, James 116 Stevas, Norman St John 40 Stratton, Kay 128 Sweden: Labour Market Board (Arbetsmarknadsstyrelsen) 12; manpower policies 12; safeguards against maladministration 157; youth training policies 169 targets 178–9, 187, 204 Taylor, Robert 61 Tebbit, Norman 48, 50, 52, 58, 59, 60, 67–8, 82 TEC Director 170 TEC Operating Agreement 173–4 Technical and Vocational EducationInitiative (TVEI) 60–4, 82; Department of Employment 63; local authorities 142; TECs 62–3 TECs see training and enterprise councils

Thatcher government: condemnation of quangos 25; enterprise culture 132–3; launch of Technical and Vocational Education Initiative 60; and MSC 24–5, 38–45, 51–3; policy decisions 134–5; training policy 50–1 Thompson, A. and Rosenberg, H. 82–3 Times Educational Supplement 121 Todd, Ron 111, 114, 115 TOPS see Training Opportunities Scheme Towards a Comprehensive Manpower Planning Policy (MSC, 1976) 20–2, 35 Towards a New Adult Training Programme (Training Agency, 1988) 107 Towards a Skill Revolution (CBI, 1989) 124–6 Trades Union Congress (TUC): demands for national training agency 13–15; and ET 96, 111, 113–17, 131–2, 200–201; manipulation by Conservative government 55; and MSC 26, 47, 53–6; response to proposed training boards 8; and YTS 72–3 Training Agency (TA) 96; continuation as unit within DE 138; diminished role after TECs 133–4; Towards a New Adult Training Programme (1988) 107; transfer of staff to TECs 141 Training Authority 128–9 Training Commission 90–96, 200; abolition 96, 116–17 Training for the Community Programme 99 training credits 81, 177–9, 187; birth of 124–6; and youth training 168–9 Training for Employment (HM Government, 1988) 105, 106, 112, 200 Training for Enterprise (TFE) 99 training and enterprise councils (TECs) 201, 127–88; accountability 149; advertising 168; budget 119; Calderdale and Kirklees 157–68; case study 157–

Index 68; CBI and 187; conflict with industrial training organizations 178, 181; criticism from government 184–5; cuts in public funding 203–6; cuts in training 202; efficiency versus democracy 156–7; Enterprise Allowance Scheme 141; and enterprise culture 155; equal opportunities 169; evaluation 201–3; funding 148–51, 175–6, 203–6, 213; G10 group 176; independence 149–50; limitations 185–7; local labourmarkets 170; merits 182–5; new initiatives 168–70; powers 150– 52; privatization 151–2; provision of ET 141; regional distribution of funds 181; relationships with government 170–77; rescue of ET 118; responsibility for TVEI 62– 3; small business sector 148; structure 153–4; targets 204; women 169; youth training 81–2, 141, 168–9 Training, Enterprise and EmploymentDivision (TEED) 96, 177 Training for Enterprise Scheme 87 Training for the Future (Department of Employment, 1972) 11–15 Training within Industry Advisory Service (TIAS) 5 Training for Jobs (Department of Employment, 1984) 54, 56–7, 97, 120, 195 Training Officer 11, 14 Training Opportunities Scheme (TOPS) 13; formal launch (1972) 16; growth 36–7; local education authorities 37; replacement by Job Training Scheme 84; as speculative training 97–8; training for stock 194 Training Services Agency (TSA) 32– 8; becomes Training Services Division 22; creation of 15–16, 19–20 Training Services Division (TSD) 22 Training for Skill (National Joint Advisory Council, 1958) 5–6

253

Training for Skills (MSC, 1977) 33 Training for Skills Programme 46 Training Standards Advisory Service (TSAS) 72, 110 Training for Vital Skills (HMG/ MSC, 1976) 32 training vouchers see training credits transferable skills 32–3 Transport and General Workers Union (TGWU) 115 tripartism 26, 47–8, 59–60, 129–30, 203 TUC see Trades Union Congress unemployment: benefits see benefits; blamed on unemployed 53, 174, 195; cuts in training places 180–81; Employment Services Agency and 27; figures, massaging 51, 104, 150; high levels by 1981: 207; impact of Jobcentres 27–8; introduction of special programmes 28–31; longterm 94–5, 105–7, 119; political concern in 1981 67; sharp rise in 1991: 174–5; training as palliative 2, 4, 10, 40; youth 45 Unemployment Unit 112 urban riots 45, 51, 64 Urwin, Charles 26, 38 Vaizey, Lord 31 Vickers, Sir Geoffrey 222, 223 Vickerstaff, S. 34 vocational education and training (VET) 65 vocational qualifications: Certificate in Vocational Preparation and Education (CVPE) 61; ET credits 105; National Vocational Qualifications (NVQs) 125–6, 178–9 voluntarism 40–41, 42, 51 voluntary training organizations 174, 217 wages: apprentices 3; drive to lower youth wages 52, 78, 137 Walker, David 66

254

Index

war, impact on training in Britain 3, 4–5 Wass, Sir Douglas 156 Watts, A.G. 78–9 Weatherby, Tom 169 Wellens, J. 191 Wells, David 154–5 Whitty, Larry 113 Who Pays for Skills? (Labour Party, 1990) 205 Wider Opportunities Training Programme (WOTP) 99 Wider Opportunities for Women (WOW) 99 Williams, Shirley 52 Willis, Norman 113, 205 Wilson government 12, 21–2 Wolfson, Brian 95, 111, 139, 149, 172 women: equal opportunities 85; inter-war training schemes 4; TECs 169; see also equal opportunities work-experience: Work-Experience Programme (WEP) 29; YOPS 30–31 work-related further education 57; provision by local authorities 120, 142 work-related non-advanced further education (NAFE) 61, 120–2 Workfare 104, 106, 112 YOPS see Youth Opportunities Scheme

Young, Sir David (later Lord Young) 53, 56, 58–9, 60, 61, 65, 68, 127, 198 Young People and Work (MSC, 1977) 30 Youth Opportunities Scheme (YOPS) 29–31; crisis management 30–31, 45; criticism by House of Commons Employment Committee 42; conversion into YTS 45, 51; Youth Task Group Report (MSC, 1982) 61 Youth Training Board 72 Youth Training Scheme (YTS) 64–82, 194: aims 68; Certification Board 76; compulsory 67–8, 71; credits 168–9; criticism 78–80; evaluation 78–82; Funding Study 81; involvement of private employers 73; and manpower planning 77–8; origins 64–8; praise and criticism 208–9; provision by TECs 81–2, 141, 168–9; quality assurance and control 72–6; rapid implementation 70, 79; reduction of allowance by Tebbitt 55; resistance from young people 73; review and extension 68–71; strategic usefulness to Conservative government 54; surveys 74–5; and TECs 81–2, 168–9; TUC and 72–3; two-year scheme 70–1 YouthAid 74 YTS see Youth Training Scheme