Tag: Speeches

Below is the text of the speech made by Matthew Hancock, the Minister of State for Skills and Enterprise, in London on 30th May 2014.

Introduction

Thank you very much.

Hello and welcome to the Makegood Festival.

I am delighted to be here today at this fantastic showcase of culture, creativity and entrepreneurship.

It’s a pleasure to see so many startups in the creative industries – and so many people who have benefited from their training with School for Startups, experience and sheer hard work.

For many of you here, this weekend represents the culmination of a year’s hard work, launching your creative business. And it is a celebration of the intensely powerful spirit of creativity and entrepreneurship that we find in Britain today.

I’m sure it’s been inspirational.

It’s pretty inspirational for me.

This weekend Makegood will play host to some of the finest new creative that London has to offer, with a line-up of speakers with a dedicated following from across creative industries.

Small businesses

Startups and small businesses like yours are the lifeblood of our economy.

In every single village, town and city in Britain, enterprising and hardworking people – like everyone in this room – are putting their energy, enthusiasm and creativity into brand new businesses.

In fact, more people than ever are rolling up their sleeves and going for it: almost 500,000 new businesses were started last year.

We are backing all of those new businesses – and all of you – every step of the way.

By extending small business rate relief until 2015 and introducing a new Employment Allowance to put up to £200 back into your business. By cutting unnecessary red tape, saving businesses over £1.2 billion already. By making it easier to access finance, like our new start-up loans. And easier to take on young people, by abolishing national insurance contributions for people under 21 from April 2015.

We want Britain to be the best place in the world to start and grow a business, bar none.

That’s my goal. Supporting you, and others like you, to grow.

Creating a stronger, more secure and more prosperous Britain.

Creative industries

All of you have a huge part to play in this.

Because the creative industries are one of the most vibrant parts of our economy – and one of our greatest strengths as a nation.

In 2012 alone, the creative industries contributed £71 billion to the economy – around 5% of UK total GVA. They’ve developed services exports worth £15.5 billion – 8% of UK services total in 2011.

In the 5 years between 2008 and 2012, they grew by 15%, almost 3 times more than the economy as a whole.

Over 100,000 creative enterprises provide 1.7 million jobs, 5% of UK employment in 2012. And if we count creative jobs across all sectors, the ‘creative economy’ provided 2.5 million jobs, 8% of UK total employment in 2012.

Because creative businesses and people help drive growth and exports in all kinds of industries – through good advertising, marketing, innovative design, software, new business models and so on.

And that’s without mentioning British films, performing arts, music, video games, crafts and fashion – from the world-leading names showcased in our GREAT campaign, which give this country such an incredible reputation from country to country and continent to continent.

These all fly the flag for Britain across the globe. And events like this are a brilliant chance to recognise their success – and spot the stars of the future.

Government is right behind you

The government is right behind you.

Over the last few years we’ve made sure that creative businesses have received special, targeted support.

Corporation tax relief has helped to secure £5.5 billion investment in a thousand British films – as well as supporting growth in TV production, animation, video games and regional theatre.

And we have provided £2.4 billion of public investment in the arts and culture in the four years since 2011 alone.

We are also making sure that creative businesses – and all businesses come to that – can rely on the sort of reliable, quick, high-quality communications infrastructure they need to survive. As I’m sure every one of you will be able to confirm, if you are well connected, and trade online, you can work from and sell to anywhere in the world – if not, it’s almost impossible to clear that first hurdle.

So we have provided £530 million to stimulate commercial investment and bring high speed broadband to rural communities; and provided £150 million to establish super-connected cities across the UK. We’re also investing up to £150 million to improve the quality and coverage of mobile phone voice and data services.

Of course, the best people to advise creative businesses on how to achieve success are those who have already done it. So we’re working with the industry on how we can encourage this vital sector to grow – including in the Creative Industries Council, chaired by Nicola Mendelsohn of Facebook – and I am looking forward to seeing the upcoming creative industries strategy written by employers for employers.

And the School for Creative Startups – who are behind this festival – are doing a fantastic job of training and backing creative entrepreneurs. I’m sure everyone here will want to thank them for all their support so far. The range and number of startups showcased here shows how successful they’ve been – and I’m sure they’re not stopping yet.

Small businesses

We want to make sure that we help, and don’t hinder. And we know that’s what you want too.

As the first government in modern history to reduce the overall amount of regulation, we’ve targeted 3,000 rules to be scrapped or amended – making it easier for businesses to survive and thrive.

And because businesses have told us that they want a tax regine which supports enterprise, a workforce with the right skills for the job, and better access to finance – that’s what we’re doing.

Thanks to our new Employment Allowance, 450,000 small businesses will pay no national insurance at all – allowing entrepreneurs to keep more of what they earn; meaning more cash for running and growing a business and creating new jobs.

And we’ve created one of the most competitive tax regimes in the world – including through the Seed Enterprise Investment Scheme and Annual Investment Allowance.

Access to finance

But I know that creative entrepreneurs often find it particularly difficult to get finance. They’re often strong on creativity, energy and enthusiasm – with loads of high-value intellectual property – but few tangible assets.

That is where our new British Business Bank is helping.

Around a third of venture capital from Enterprise Capital Funds has gone to creative and digital small businesses.

The Bank’s Enterprise Finance Guarantee has enabled loans to more than 500 creative businesses. The Business Finance Partnership, a public / private co-investment scheme for alternative and peer-to-peer lenders, is also playing an important role.

And 23% of all Start-up Loans have been offered to new businesses in the creative industries.

But money isn’t the only factor.

Skills

Alongside proper finance, you need a highly-skilled, well-educated workforce.

Research from a successful creative cluster in Brighton suggests that the most successful creative businesses are led by people with a combination of creative, digital and business skills.

And while we know that creative businesses thrive on diverse talents, we also know that doors have not always been open to people from all backgrounds, especially those without degrees.

This is now changing for the better.

Five years ago there were virtually no apprentices in the creative industries – there are now over 4,200.

We have driven up the quality of training every apprentice receives and now offer grants of up to £1,500 to firms that hire an apprentice.

New higher-level apprenticeships, equivalent to university study, have been developed by industry, for example in fashion, textiles, advertising and software development.

And the £15 million, publicly-funded Creative Employment Programme is supporting up to 6,500 new apprenticeships, pre-apprenticeships and paid internships in creative organisations.

But to make sure these changes make a real impact, we need to put employers in the driving seat – so that they are empowered to take responsibility for training and development, working with employees, freelancers, trade unions and training providers to make sure that their staff develop the skills they need to succeed.

Conclusion

These changes – and the other action I’ve outlined today – are just part of the work this government is doing to encourage creative start-ups, help small businesses grow and attract more talent into the creative industries from more diverse backgrounds.

Many of you here today are showing what can be done.

I wish you every success in the future.

Your success doesn’t just benefit you it helps the whole creative economy, the whole UK economy, to grow stronger and fairer, building a more prosperous country for all of us.

Below is the text of the speech made by Matthew Hancock, the Skills Minister, at the UK Commission for Employment and Skills event at Plaisterers’ Hall in London on 30th April 2014.

Thank you, it’s a pleasure to be here.

It’s good to see an event celebrating employers and UKCES working together.

And a livery company is a good place to do it. Because these guilds tell the history of our economy.

From the medieval trades – fletchers, cordwainers or girdlers – through the early modern clockmakers, spectacle-makers – and the playing-card makers, obviously – down to the 20th-century companies of actuaries, consultants and bankers.

And the newest company of all, just a year old, is the Worshipful Company of Educators.

That couldn’t be more appropriate.

Because employment is at a record high, we’re set to grow faster than any advanced economy this year, and wages are rising faster than inflation.

And if we want to make the most of that – we need a strong education system.

People need the right skills to get jobs. And employers need skilled people to grow.

If we’re to do that, we face 2 challenges. I want to talk today about what we’re doing to rise to them.

The first challenge is the divide between academic and vocational education.

And the second, the divide between education, and work.

The divide between academic and vocational education

Taking the first – the issue is partly about attitudes.

We still hear talk of children being ‘non-academic’ or as ‘unsuited’ to vocational careers.

But any employer will tell you good literacy and numeracy are the most basic requirements for any employee.

So it’s just wrong to say a technical education is an opt-out of high standards.

And it’s just wrong to say high standards are somehow irrelevant to workplace skills.

I defy anyone to find any good job that does not need a combination of knowledge, skill and behaviour. We must equip young people with all these.

But even worse than the mindset – the divide was a matter of policy, too.

Vocational courses had no minimum standard for English and maths.

And governments tried to run a skills bureaucracy from the top down – deciding who should study what, at each level and for how long.

It was cumbersome and clumsy: and it failed.

By 2010, somewhere between a quarter and a third of all young people were on poor-quality qualifications.

Hardly surprising, then, if vocational routes lost value and status, compared to academic.

…which we want to end

We are determined to end this divide – by restoring rigour, across all education.

Now, regardless of whether they’re in school, college or workplace training – all students will now study maths and English right up to 18, to at least a C at GCSE.

And look at some of the new institutions we’re creating.

Since January we have announced new colleges, in important sectors like rail, nuclear and software.

These will be elite institutions, and they will blur the lines between vocational and academic.

They will provide relevant, technical skills – alongside top-quality academic study.

They will take students on from a young age – but go right up to university level.

They aim to be the best in the world – so they are not just an alternative to the best universities, but are elite peers, collaborators and competitors, too.

And today I can announce that we’ll be setting up the first new FE college for over 20 years.

Prospects College of Advanced Technology will involve employers as never before, providing cutting-edge technical education in engineering, aviation, rail and construction to young people over 16.

When it’s fully up and running, it will serve over 1,000 students and 1,200 young people on apprenticeships – making it one of the largest group training associations in the country.

Parity of esteem is a nice phrase: these colleges will make it a reality.

And just as technology has transformed industry after industry, it’s coming to education. New assessment, learning and planning tools can help refine teaching – making it more measurable, and driving up standards.

So we set up the Education Technology Group – alongside a group for FE, and new capital funding for broadband in colleges – to explore what more we can do.

And at every level, we are restoring faith in vocational qualifications.

We’re stopping funding per qualification passed – which encouraged chasing easy certificates. We’ve introduced grading to all apprenticeships. It’s absurd to say there aren’t different levels of ability for vocational skills: anyone who saw my welding at the Skills Show a few months would agree.

Grades must be valid, of course – but no skill can’t be graded. And in time, we want grading across the system – for better, finer measurement of achievement, and for clear, aspirational goals for students.

We’ve filtered out poor-value qualifications: over 6,500 will have funding removed.

The qualifications recognised in performance tables will be those explicitly supported by universities and employers.

That means employers can trust qualifications.

And it means young people face smarter choices, and better prospects.

And they’re starting to notice. We have a record number of young people in apprenticeships. The majority of young people say they want to do an apprenticeship when they leave school. The top apprenticeships are already as competitive as the top universities.

That’s promising. But we want to go further. And our reforms aim to create a new norm: where young people choose university or an apprenticeship – where we end the divide between academic and vocational education.

The divide between work and training

Turning to the second divide: there’s a gulf between work and education.

Again, this was a matter of mindset and a product of policy.

As governments thought they knew best, vocational courses lost sight of the needs of business, and academic courses lost sight of practical context.

Now, we’re making the entire system much more responsive to employers: Tech Levels, yes, and new GCSEs in English and maths which will be much more functional too.

This link between work and education must be based on stronger qualifications, and it can be helped by stronger relationships too. We’re strengthening careers advice – so that it’s more inspirational, with a more dynamic, refreshed National Careers Service coming this autumn.

Our guidance to schools is much firmer about the need to engage employers. No school now has an excuse not to be engaging local employers. And no employer has an excuse not to engage their local school.

And we know some young people aren’t ready for work, or a full apprenticeship. So we created traineeships – to ease that transition.

Just this week, we had a trainee, Yusuf, start in my office in Parliament – and several other MPs have taken on trainees, too.

We’re giving genuine power to employers to shape training: like our apprenticeships trailblazers, who are writing the new apprenticeship standards.

Employer-owned pilots

And today, I am delighted to announce the next stage of our employer ownership of skills pilot.

Under this scheme, employers combine their own money with government funding, to invest in the training they need.

It’s simple, direct, and focussed.

The second wave of funding started last year. Figures released today show that the first projects will create over 5,000 traineeships.

Like National Grid – who plan to provide over 3,000 – or Everton Football club, who plan 1,600 – though let’s hope that after Everton, the trainees have better careers than their former managers.

Today, I can announce the next projects: an extra £5 million going direct to employers.

Companies like Kostal, leading a new advanced manufacturing programme in Sheffield; Blackpool Pleasure Beach, investing in tourism training; and Freedom Communications in Watford, in business technology.

These companies know their training needs best: so now, they get the budget.

We’ve learnt a lot from the first rounds of funding about how to support employers. And we know that some sectors have specialist skills.

Like the automotive sector – a great British success story of recent years.

So I can also tell you that learning the lessons from EOP, we will establish a new permanent employer-owned fund and are making the first call for applicants, for companies in the car industry supply chain.

From next week, they can submit proposals to get money to train – to tackle skills shortages, and go on to ever-greater things.

We will make £10 million available immediately – and will offer a further £10 million later in the year.

I know you’ve spent time today showing what employers can do when they get directly involved in training. That’s exactly the spirit of our reforms – and these new announcements aim to find, fund and fuel even more.

Conclusion

So that’s what we want.

To end the divide between vocational and academic. It’s a false divide: only rigour in both will help our young people.

And to end the divide between training and work. It’s a dangerous divide: only responsiveness will help people get jobs, and help employers grow.

And if we can do that – think of what’s possible.

What livery companies may come in the future, no one can say.

But I hope that if we’re in this hall in 10, or 20 or 30 years, we’re still talking about the success stories of this decade – of a time when we ended the divides that have held us back.

Below is the text of the speech made by Matthew Hancock, the Minister of State for Skills and Enterprise, to the Federation of Small Businesses Conference held in Manchester on 28th March 2014.

It is a pleasure to be here, and I want to start by wishing the FSB a very happy 40th birthday. You are tireless advocates for small business and I know everyone in this room is grateful for the work you do.

The FSB came into being at a difficult time for this country. In 1974 inflation spiked at 18%, and England had a dreadful football team.

I’m happy to report progress. Today inflation is 1.7%.

It’s a pleasure to be here because for me it’s almost coming home. I was born and grew up just down the M56 at Chester. And I grew up in my family’s small business. Those dinner-table conversations about the future of our firm helped shape me as a politician.

So I know from my heart that small business isn’t just a job, but a way of life.

And to all those who’ve put their time, talent and capital into running a small business, my message to you is that this government is backing you to the hilt.

Being small forces you to think big, to take risks and innovate. It’s why you create the vast majority of new jobs each year.

And it’s why you’re at the heart of our long term economic plan to create a more secure and prosperous Britain.

We saw in last week’s Budget that the plan is working. It’s there in the numbers.

1.7 million new private sector jobs and 500,000 new businesses have been created No major developed economy is recovering faster than Britain.

Crucially, a balanced recovery. The latest GDP figures show growth across services, manufacturing and construction, and unemployment down in every region.

But it isn’t just about the numbers. What drives economic recovery is a belief that things will get better. So it’s incredibly encouraging to see the results of the latest FSB survey: 2-thirds of businesses expect to grow in the next year; a quarter plan to export more. And a marked improvement in access to finance.

Even the floods couldn’t dampen the animal spirits of British business.

And you might expect me to stand here and claim all the credit for the recovery on behalf of the government.

But I won’t…

…Because this recovery isn’t made in Whitehall, it was built in the business parks and garage offices, in the white vans and workshops, in the mills and market squares of Great Britain.

It’s thanks to you that we have record numbers of people in work.

Indeed, the lesson of the crash is that government must respect the limits of its power over the economy.

We can’t abolish boom and bust, we can’t deliver sustainable growth simply by flicking a switch in the Treasury; what we can do is to set the framework in which private enterprise can flourish.

And while the recovery is welcome, there is much more to do.

My role as Minister for Skills and Enterprise is not to create the jobs and businesses, but to be on the side of those who do.

How we are helping small businesses today

That’s why last year we launched Small Business: GREAT Ambition – our commitment to make it easier for small firms to grow.

And why we’ve taken action on the issues that you’ve told us matter to you most.

Like a tax regime which supports enterprise, a workforce with the right skills for the job; access to finance, and – through deregulation – getting government out of the way where it hinders instead of helps.

Take access to finance.

We all know money is tight. So where funds are available we’ve been careful to target them at small firms.

British Business Bank schemes are now supporting £600 million of investment each year.

Start-Up Loans have already committed over £80 million and today I’m proud to announce we’ve offered the 15,000th Start-Up loan.

Our £200 million Growth Accelerator Programme has supported over 12,000 small businesses so far, and we aim to support up to more than double that.

Businesses tell us this programme is making a real difference. In its first year, almost 9 in 10 firms that used it thought the Growth Accelerator helped increase their turnover. 97% would recommend it to others.

But while government assistance can give many firms the leg-up they need, tax cuts can reach even more.

It’s why we’ve cut the main rate of corporation tax from 28% to 23%, falling to 20% by 2015 – the joint lowest rate in the G20. Just this week I voted for lower corporation tax again.

It’s why we’ve introduced the new Employment Allowance which, from next month, will save you up to £2,000 on your National Insurance bills – a cashback on jobs.

Letting you keep more of what you earn means more cash available for what really matters to you: running and growing your business, creating jobs.

This summer the Office of Tax Simplification will be reporting back on what more can be done to improve the competitiveness of UK tax administration.

That’s my holiday reading sorted.

Of course, it isn’t just about government doing more. There are some areas where we need to do less.

I’m proud that we’re the first government in modern times actually to reduce red tape. We’ve saved businesses over £1 billion so far by cutting or reforming regulation.

What does that mean in reality?

When we came into office there were rules governing the precise design of ‘No Smoking’ signs, rules requiring a license if you wanted to show a film in school…

There were even age restrictions on the sale of chocolate liqueurs.

…Because we all know the sad sight of a group of teenagers, on a park bench, off their heads on a box of Thorntons.

Too often in recent times process and box-ticking replaced common sense and personal responsibility.

And since every new hire is a risk, we have reformed employment laws and employment tribunals so businesses – especially small businesses – have greater confidence in taking on new staff.

Our tribunal reforms are working. Jobs are up and the number of cases taken to tribunal is down 80%. The only work being hit by our tribunal reform is the workload of employment lawyers.

More to do

But we’re determined to do more.

You told us you wanted action on the cost of energy.

We listened, and in the Budget we announced a £7 billion package of support, including compensation for energy intensive industries with higher electricity costs resulting from green levies.

You told us that business rates should be more responsive to property values, and that you wanted more simplicity for ratepayers.

So we cut £1,000 off rates for retailers, and we’re going to review the whole way business rates are levied.

And as the economy recovers and your books fill up, we know that prompt payment is essential. So we will strengthen the rules on transparency, so everyone knows where they stand.

In the mean time we will keep pressing more companies to sign up to the Institute of Credit Management’s prompt payment code. Over 1,500 signatories are now committed to pay their suppliers on time, including the majority of FTSE100 companies.

Floods

Being on the side of small business means being there in a crisis too.

So we worked overnights and over weekends to put together a £10 million Business Support Scheme to help flooded properties, with grants of up to £5,000 to make buildings more resilient in the future and 3 months of automatic business rate relief.

In the Budget we increased funding for flood defences by £140 million.

Tackling these sorts of emergencies means everyone pulling together. And I want to pay tribute to the FSB’s work advising and guiding on issues like handling insurance claims. Helping to make life that little bit easier during an incredibly stressful time.

Budget

And of course while last week’s Budget will go down in history as the ‘Savers’ Budget’, saving and investment are 2 sides of the same coin. They’re both about planning for the long term, deferring the reward, taking responsibility for the future.

This government believes that the way to build a stronger economy is to trust people with their own money. And whether you’re saving for your pension pot, or investing in your business, we want to help.

So we froze fuel duty, now 20p lower than planned, and we’re extending the Investment Allowance, increasing it to £500,000 too.

But it isn’t just about investment in capital. The iPhone costs Apple around $180 to manufacture and assemble. It sells for 3 times as much, thanks to the design of that great British success story, Sir Jonny Ive.

In a world where value is added on the drawing board as well as the production line, investment in people is just as important.

So we are expanding apprenticeships and it’s a central mission of my job to drive the education system and employers closer together: making education more rigorous and more responsive to employers needs.

We will continue to do more.

You never stop looking for new trends, new markets, new opportunities. It’s what’s seen you through this recession, and it’s what’s pulling us into recovery. In turn, we will never stop looking for new ways to help you fulfill your ambitions.

Today I’m delighted to announce further progress on clearing away the barriers to growth.

When it comes to business policy, we don’t believe Whitehall has all the answers. Our Entrepreneurs in Residence scheme has brought entrepreneurs into the heart of government for precisely this reason.

So today we are launching our search for 2 new Entrepreneurs in Residence, to take the scheme into a second year.

The first will advise us on how to help small businesses achieve the scale-up and exports we all want to see.

The second will work with us on the exciting new industry of Synthetic Biology, which we believe has huge potential for the life sciences and energy sectors.

But as everyone in this room knows, coming up with ideas is the easy bit. The biggest challenge faced by any entrepreneur is getting them to market.

That’s why we’re determined to create a financial ecosystem which nurtures enterprise, one which bridges the gap between concept and commercial reality.

When it comes to financing great new products we in government want to lead by example.

Technology is poised to change education as radically over the next decade as it has changed everything else over the last. So today I can announce that the Technology Strategy Board is launching a new education technology design competition to give small firms with innovative ideas for EdTech products the chance to turn them into a reality.

Celebrating small business

Which is why I want to highlight 1 fantastic grass-roots initiative which has got the whole country taking notice of what small businesses offer. Last year’s Small Business Saturday – the first ever in the UK – was a huge success, with thousands of businesses taking part across the country and almost £5 billion spent on the day. I’m thrilled that today, we can mark the launch of Small Business Saturday 2014, which will be on 6 December.

With the support of the FSB, the media, and other supporters – I know we can make this year’s event even bigger than the last. Government will certainly be doing its bit to back Small Business Saturday. I urge all of you to get involved.

But celebrating is one thing, hard contracts is another. For some firms the greatest prize we can offer is fair access to the government’s £230 billion public procurement business. The FSB has led the call on this and we are making progress. Today I’m glad to report we’re taking more action.

I can announce that by October we will have legislated to make contract opportunities accessible in one place online, to remove a whole thicket of bureaucracy by abolishing pre-qualification questionnaires (PQQs), and to drive fair payment down the supply chain by requiring prime suppliers as well as procurers to pay within 30 days.

My message to public bodies and small suppliers is get ready, the changes are coming – it’s time for government to be open for small business.

But if we’re going to tackle unnecessary complexity in the way small firms interact with the state, we also need to get our own house in order.

We’re committed to making sure our business support schemes are easier to find and more relevant.

At the start of this year we set up a ‘star chamber’ of some of the wisest and most experienced minds, and me, to bring together and simplify government’s portfolio of business support. By June we will announce our intentions, so that reforms can be completed by March 2015.

We will be working with businesses and the FSB to make sure this new service is user-friendly for you: the customer, and fully integrated locally, connected to business schools and growth hubs across the country.

All of these measures, all of the actions taken in the Budget and in between, each one may be important, but they are but individual stones in something much bigger. Every measure matters, but I believe they are each part of a greater whole. For our aim is not a list of measures. Our aim is that each measure is a stone in the great cathedral to the culture of enterprise that we are building.

Yes, each stone plays its part – but together, stone by stone, we are striving to build something bigger than any one of us. A self-confident nation, enterprising and ambitious. A culture of enterprise which celebrates success without criticising failure, where we can build opportunity for our children and children’s children. Building that culture is no quick task. Yes it is happening but so to is it yet fragile. And I want on behalf of all future entrepreneurs, to enlist your help in that task. Today I pledge myself to do all in my command to support enterprise. I hope you will join me in that task.

Thank you.

Below is the text of the speech made by Matthew Hancock, the Minister of State for Skills and Enterprise, at BBC Broadcasting House in London at the BBC’s ‘You’re Hired Conference’ on 3rd March 2014.

Thank you very much for that kind introduction.

It’s an enormous pleasure to be here today to celebrate the start of National Apprenticeship Week 2014.

Now strictly speaking, I should start by taking issue with the title of today’s event.

And with a certain programme – and a certain Peer of the Realm – which have done more to bring apprenticeships into disrepute than any politician could imagine.

But I wouldn’t dare incur the wrath of Lord Sugar – nor the withering lip curl of Nick and Karen.

Because we’re not here today to talk about those apprentices but about real apprenticeships, new and improved for the 21st century.

I want to mention today the history of apprenticeships.

The reforms we’re making to drive up standards.

And how all of you – and everyone at the BBC – can help.

Breaking the stranglehold on social mobility

After all, why do apprenticeships matter?

Yes, they’re important for our economy, and good value for the taxpayer.

But centrally they are about spreading opportunity and about giving everyone the chance to reach their potential.

Seventeen years ago, Andrew Adonis – now a lofty Lord, then a (relatively) lowly policy adviser – published ‘A Class Act’.

In it, he forensically skewered the myth of Britain’s classless society.

He and fellow author Stephen Pollard pointed to the rise, ever since the 1960s, of what they dubbed “a new elite of top professionals and managers, at once meritocratic yet exclusive”.

They warned of this phenomenon in 1997 – and, contrary to the words of that administration’s theme song, things would only get worse.

The glittering prizes of society went increasingly to a tiny, self-selecting minority.

Overwhelmingly, university-educated – indeed, often from just a handful of world-famous universities.

And overwhelmingly the alumni of some of the most ambitious, academic schools in this country: which is to say, in the world.

This educational elite went on to nab a huge proportion of the top jobs in society.

This led directly to what I’ll call the ‘Gove question’: when will a state educated man, or woman, finally make it to edit the Guardian?

New norm

So we want things to change. And there are signs that they’re starting to.

In recent years, the percentage of young people in England going to university has reached a record high.

Young people from disadvantaged backgrounds are now 70% more likely to enter university than in 2004.

This is a credit to the hard work and dedication of thousands of teachers, all over the country.

It’s a sign of success in turning around failing schools and giving people from the toughest backgrounds access to the same sort of ambitious, stretching education as their wealthier peers.

And it proves that new tuition fees – a government loan, only to be repaid once you start earning – are not scaring young people off.

On the contrary – even since our new tuition fees were introduced, application rates have reached new highs – in particular for young people from the poorest backgrounds.

Because they understand that investing in their future – and not paying a penny back before they earn £21,000 a year – is a one way bet.

Apprenticeships – then and now

But this university dominance wasn’t always the case.

Back in the 1950s, the main route into many jobs – in industry, engineering, construction, and all sorts of other businesses – was an apprenticeship.

Ex-apprentices like Sir Anthony Bamford, chairman of JCB; John Caudwell, founder of Phones4U; Charlie Mullins, founder of Pimlico Plumbers and many others, all started their careers as apprentices – and went on to reach the very top of their professions.

One in 5 employers on the City and Guilds list of the Top 100 Apprenticeship Employers currently have former apprentices on the board and former apprentices, on average, make up almost a third of their senior management.

But that old-style apprenticeship model was based overwhelmingly in heavy industry. In 1950, a full 60% of apprenticeships were in manufacturing.

They were unprepared and unsuited for vast swathes of the post-industrial economy – and when the world changed, they no longer worked.

By the time I was growing up – in the 1980s – apprenticeships had withered on the vine.

As universities expanded, more employers started to demand a degree – so more young people decided to go to university.

Those without a degree found it harder to access the best jobs; harder to break into the professions; harder to succeed without the same qualifications as everyone else.

And as the old, heavy industries declined, by the early 1990s, apprenticeship numbers had dropped down to their lowest ever.

Education as the key to success

But things are finally balancing out.

Because the only way to effect wholesale change is to break open the routes to success.

To make social mobility a reality – and to allow young people from every background an equal chance to reach the top.

That means improving schools, so that every child in the country – no matter where they live, or what their background – enjoys the sort of high-quality, rich, rounded education hitherto reserved only for the very rich.

It means driving up the standard of qualifications, both academic and vocational – so every young person knows that their hard work and commitment will lead to qualifications which command respect among employers, universities and colleges.

It means opening up the routes into professions – showing that a university degree isn’t the only way to start a top flight career – and that apprenticeships, traineeships and vocational training can be just as rewarding, and can lead just as far.

It means a new norm – for every young person finishing full time education to go to university, or to start an apprenticeship, knowing that either option will give a fantastic start to their future.

Our job in government is not to push people one way or the other, but to ensure there are good choices for both.

Driving up standards, rigour and responsiveness

When apprenticeships hit the bottom of the curve, in the 1990s, the government of the day brought in crucial reforms – introducing paid, on the job training, leading to nationally recognised qualifications, across more industries than ever before.

And since 2010, numbers are sharply up.

We took urgent steps to make sure that every single apprenticeship was higher quality, more rigorous and more responsive to the needs of employers.

Endlessly complicated bureaucratic barriers preventing companies from taking on apprentices have been simplified or removed.

Now, there’s just a simple, 3-step hiring process – accessible to small and medium sized enterprises, as well as big business.

And some of this country’s leading employers and trade bodies are taking the lead – as trailblazers – in designing new apprenticeship standards.

Already quality – and demand – are rising. Last year, over half a million people started an apprenticeship – almost twice as many as in 2009 to 2010; and more than 3 times as many as in 2002 to 2003.

During 2012 to 2013 there were 868,700 people undertaking an apprenticeship – the highest recorded in modern history.

And apprenticeships are spreading to reflect the modern economy. In total, apprenticeships now cover more than 170 industries.

Of course, that still means engineering and manufacturing.

But also advertising and nuclear decommissioning, publishing and catering, arts, media, retail, law, IT and much, much more.

Just last week, I was lucky enough to meet the first ever cohort of space engineering apprentices at the National Space Centre, in Leicester – who were hugely excited about starting their training this week.

Even the Civil Service – historically the home of Sir Humphrey – now offers 2 fast tracks into the heart of government, 1 for university graduates, 1 for apprentices.

BBC is leading the way

Standing here today, in another bastion of tradition – the oldest and largest national broadcaster in the world – it’s a pleasure to see the BBC working with the wider industry and leading the way.

Committed to hiring 170 apprentices a year by 2014 – 2 years ahead of target.

Launching your Stephen Lawrence BBC Training Programme – in partnership with the Stephen Lawrence Charitable Trust and Job Centres – giving young people not yet ready for apprenticeships or other jobs the chance to take up a traineeship, to get meaningful work experience and extra training in English, maths, and how to get on in the workplace. Traineeships are a stepping stone to future success for young people, businesses and the wider economy – and they really help to unlock young people’s potential.

It’s great that the BBC has taken a lead, with industry partners, in designing and launching 2 entirely new apprenticeships in technology and production management – supported by the government’s employer ownership of skills pilots.

Also great news are the announcements we’ve just heard from Tony Hall about the apprenticeships in journalism, business and legal, launching soon – on top of the BBC’s biggest ever, the Local Apprenticeship for 45 young people in local radio stations all around the UK.

And it’s fantastic that you’re working with us and other leading broadcasters to develop new apprenticeships in your sector.

Winning friends and influencing people

I’ve seen for myself that success begets success – that hiring apprentices makes an organisation more enthusiastic about apprentices, and more likely to hire more in the future.

It’s certainly something I’ve noticed with MPs – as soon as an MP gets an apprentice, they become passionate evangelists for apprenticeships, inside and outside Parliament.

But they’re not the only ones.

82% of employers with apprentices say they would recommend the scheme to other employers.

And 89% of employers surveyed said that if they were just starting out in their career now, they would choose to do an apprenticeship.

This is a huge vote of confidence – and a huge endorsement of our changes to the system.

And as a cheerleader for change.

But there’s still further to go.

And that’s where everyone here has a role to play.

Because the BBC is better qualified than almost any other employer to help raise the profile – and the prestige – of apprenticeships.

Not just those working in your own organisation; not just Lord Sugar’s acolytes striding purposefully up escalators, holding their phones out in front of their faces.

But real apprentices, working in real companies – all over the country, from all sorts of backgrounds.

They are the ones who could and should be featured in all sorts of BBC programming, showing young people all over the country what opportunities are available to them, and where those opportunities could lead.

I’d love to see more apprentices being shown across programmes from ‘Today’ to ‘Top Gear’; ‘Holby City’ to ‘Horizon’.

Because apprenticeships – and the young people who take them – are becoming a part of our national life.

You can help us give them an even higher profile.

Again and again, my department has noticed an incredible spike in interest whenever apprenticeships are mentioned in news bulletins and current affairs programmes.

And that interest is overwhelmingly positive.

Like apprentices themselves, and their friends and family, proudly getting in touch to explain how much they’re enjoying their apprenticeships, and how much they’re learning every day.

Conclusion

Apprenticeships are about busting open opportunity, promoting social mobility, and of course preparing the economy for the jobs of the future.

As we heard just yesterday, apprenticeships boosted UK business by £1.8 billion last year – and, on average, each apprentice delivered a boost of £2,000 to their employer.

Today’s apprentice could be tomorrow’s director of the board; or tomorrow’s Director-General, come to that.

So we must take every opportunity to show off the excellent work taking place, all over the country; and to give young apprentices confidence that their choice has just as much kudos – and just as bright a future – as any other.

Thank you.

Below is the text of the speech made by Matthew Hancock, the Minister of State for Skills and Enterprise, at Deloitte in London on 3rd March 2014.

Thank you Ian, it’s a pleasure to be here.

I want to talk today about the link between employment and skills. To argue employers can’t find the skilled staff they need, because our skills system lacked rigour and responsiveness.

And I want to explain our response – about how we can tackle this gap – and suggest that we have a once in a generation opportunity to get there.

Growing importance of skills

We all know that an effective skills system is an economic necessity.

What’s new, though – and what’s interesting – is that it’s becoming more important than ever.

You may have seen the other week that Whatsapp, a messaging service, was bought by Facebook for $19 billion.

That’s about the same value as the clothes shop, Gap.

Gap has 135,000 employees.

Whatsapp has 55.

And that’s a sign of the times: because technology and globalisation are changing the shape of our labour market.

And as the number of jobs grows, we need to ensure our young people can get those jobs. We can be a highly educated nation that wins those jobs.

At the moment, something wrong.

At the moment, though, something is wrong.

Youth unemployment has come down – dropping by almost 50,000 in the last 3 months of 2013.

But it remains too high.

Yet at the same time, we have employers saying they can’t get the skills they need.

A recent study by McKinsey, for example, found that around a quarter of employers had left entry-level vacancies unfilled.

A third had lost out on business opportunities because they couldn’t find recruits with the right skills.

Why is this?

How can we simultaneously have young people out of work – and employers that can’t get the right workers?

What’s going on?

It could be the lingering effect of the 2008 crash – an extended economic hangover.

But look at the long-term trend.

From 1992 to the late 1990s, youth unemployment was on a gradual downwards curve.

Then in the early 2000s, it started to rise again. Even as GDP grew, at no point since 1997 did youth unemployment drop beneath 10%.

So what is the problem?

It could be regulation: employment law making it harder for businesses to create jobs – protecting existing workers to the exclusion of others, especially young, entry-level workers.

That’s certainly the pattern we see in southern Europe – regulation strangling new businesses, punishing those trying to break into work – workers’ rights trumping the right to work.

So in Britain, we’re reducing unnecessary red tape – offered strong incentives to hire, removing barriers, like making it 2 years before an employee can go to a tribunal.

Some people say it’s spending on training.

But spending went up over the past 10 years – and as we’ve seen, so did youth unemployment.

So spending alone clearly isn’t enough.

If we’re trying, then, to explain why have both youth unemployment – and employer demand for work – we can see:

– it’s not just about a short-term response to recession

– nor is it simply a matter of money

So what is it?

Problem is poor skills.

There’s a clue in the OECD’s latest adult skills survey. In most countries, younger adults have better literacy and numeracy than older generations.

That’s because they improved their education systems over time – keeping pace with a more competitive world.

But in the UK, overall, our young adults did no better than their grandparents.

I’m sure you saw the report when it came out. But it’s worth stressing just how astonishing it is that the generation that grew up with Twiggy did better than the generation that grew up with Twitter.

We stagnated. And too many of our youngest generation are leaving education without essential skills.

And not skills employers need.

But just as important, too often our young people have the wrong skills.

And to understand why, we have to look at the recent history of further education.

In 1992, colleges were freed by Kenneth Baker – taken out of local authority control.

But from the late 1990s, central control gradually grew.

Governments produced confident predictions of what jobs we would have.

A vast skills bureaucracy took those predictions, ran them through a magic number machine – and came out with skills and training requirements.

They then passed them on to further education providers: dictating what courses they could offer, at what level, and for whom.

It didn’t work.

Because the idea that bureaucrats sitting with a computer and calculator issuing edicts would create the workforce with the right skills was – at best – naïve.

So what do we do?

So if the question is why we have youth unemployment at the same time as employer demand – the answer is the structure of our skills system.

If it produces young people with low skills and the wrong skills – we shouldn’t be surprised if employers can’t get the right people.

We’ve got to fix it.

And we’re doing that in 3 ways. You might call them the 3 Rs:

We’re bringing in responsiveness, rigour – and we want a revolution in attitudes.

Responsiveness

First, responsiveness.

In the past, governments responded to skills gaps by creating more complexity.

When their predictions didn’t work out, they invented new sector bodies, quangos, or intermediaries – all purporting to ‘speak for business’.

Instead, we’re giving genuine power to employers to shape vocational education.

Look at apprenticeships.

Instead of being designed by committee, using complex frameworks – we want clearer, better standards, written by employers.

Our first 8 trailblazers are already helping us prepare reformed apprenticeships.

Designed by employers for employers.

They’re household names in sectors from finance to food, aerospace to auto engineering – and are all committed to developing higher-quality apprenticeships that are more closely linked to their needs.

We’re promoting employer ownership of skills – giving them direct control over skills budgets.

We’re encouraging colleges to look out to their community – and build better links with business – and a month ago, announced new elite colleges driven by real demand in nuclear, rail and advanced manufacturing.

All of these things make the system more responsive to the needs of business.

Rigour

Our second aim is rigour.

Rigour means expecting high standards of everyone. Everyone.

Employers expect GCSE maths and English as a minimum: and as the OECD makes clear, at the moment, it is the most basic skills that some of our young people lack.

So now, we’re making sure that all students will keep studying maths and English to 18 – at to at least a C at GCSE – whether they’re in a school, college or workplace training.

And we know that some young people aren’t quite ready for a full apprenticeship or job.

So we created traineeships – to ease that transition to work.

Because we are determined to get to a position where employers no longer say – we can’t find young people who can count or spell or have the right attitude for the job.

Rigour means improving qualifications, too.

We’ve stopped the system of funding per qualification passed – giving a perverse incentive to chase the certificates that students can pass more easily. Now, we provide funding per learner.

And Alison Wolf’s review found that somewhere between a quarter and a third of young people – some 350,000 teenagers – were on poor-quality qualifications.

So last year we filtered out poor-value qualifications for 14 to16 year olds – removing more than 3,000 courses.

We’ve done the same for 16 to 19 year olds this year – removing 3,403 courses.

And more than 1800 adult-age courses were removed from funding, too.

Instead of these reams of poor-value qualifications, we are focussing on those that really represent achievement.

From 2016, a new set of approved qualifications will be taught – with only those winning the support of universities and employers included in performance tables.

These include new tech level qualifications, the core of the TechBacc programmes, which will be taught from this autumn – giving a high-quality alternative to A levels. Each 1 endorsed by employers.

And I am delighted today to announce new TechBacc trailblazers.

Just like our apprenticeships trailblazers we have 8 post 16 schools and colleges who have agreed to develop their technical subjects with local employers. We’re funding them to explore how their courses can reflect the real world of work – and raise quality even further.

All of this means employers can trust qualifications – and that students are more likely to enter into training that leads to a good job.

Culture

So we are bringing responsiveness and rigour to the system.

In time – those 2 principles can lead what I hope is an even bigger change.

A change in attitudes towards training.

An under-performing skills system has 1 big problem: it builds its own momentum.

After all, in response to skills shortages, employers have options.

They can train up people themselves.

They can hire abroad – or find immigrant labour.

They can poach trained staff from competitors.

Or they can rifle through their supply chain, and poach from there.

So what does each boss and business do?

Who would be the first business to train – the first to risk them losing their trained staff?

Why train if no-one else in your sector does?

There is an alternative.

Look at countries like Germany. They have the opposite culture.

An employer seeking staff has the same set of options: train, import, or poach.

But because most companies assume their role is to train their staff – there is no penalty in training.

And that, in turn, makes training more likely. Ultimately training is good for business.

That’s the culture we must inculcate.

Our reforms – rigour and responsiveness – aim to break out of a low-training culture – and into 1 where there is a comparative advantage in training.

Because if qualifications are meaningful and high-quality, we make training a better, more reliable investment – more likely to help the bottom line.

If every young person entering the world of work has essential literacy and numeracy, employers no longer think of training as remedial – making up for failings of others – but can see it as something of higher value.

And if the system is responsive to employers’ needs – if enough heads of HR and CEOs and CFOs see they’re getting the people they need – then apprentice by apprentice, course by course, business by business we will hammer away at a low-training culture until eventually we can sound its death knell, and bring the high training culture we need

Conclusion

And there’s never been a better time to do it.

Turning the economy round is no easy task. We have much more to do. But things are moving the right direction.

And combine that promise of growth with everything else.

A global economy that rewards skills as never before.

Comprehensive reform of our vocational education based on rigour and responsiveness.

Put all those things together – and we have a once in a generation chance to crack it – to fix the system.

A once in a generation opportunity to get vocational education doing what it’s supposed to do – give students real, valued training – and give employers the skilled people they need.

That, to me, is a very good reason to look forward to our future.

Below is the text of the speech made by Matthew Hancock, the Minister of State for Skills and Enterprise, at the London Film Museum on 4th March 2014.

Thanks Ben [Pike, Managing Director, QA Apprenticeships]. It’s a pleasure to be back and to see this year’s event – and National Apprenticeships Week – packing an even bigger punch than last year.

There’s a lot we can be proud of.

A record 868,700 people in apprenticeships.

The number of apprenticeships up over 30% over the same period.

And applications are up – by a massive 48% – with a big increase in young women applying. And under the statistics, each are giving extra opportunity.

I’ve been boosting those figures by taking on my very own apprentice.

My first apprentice, Andrew Hill, completed his placement in December. I was sorry to say goodbye but proud to see how far he’d come.

Blossoming from a shy teenager to a confident young professional who said exactly the right thing when the Prime Minister asked what I’m like as a boss.

Thanks Andrew – a job well done.

This year, the applications to be my apprentice were so good I took on 2. Beth and Michelle are doing a terrific job supporting me in my role as local MP.

At BIS my officials are road-testing the very reforms they’ve been working on. We’ve got an apprentice working alongside us and are about to take on a trainee.

The Civil Service now has an apprentice fast stream alongside the traditional graduate fast stream.

So the young people at the heart of these reforms are now at the heart of government.

Keeping us focused and fired up. Reminding us of the hopes and dreams at stake behind those figures.

But while politicians like me get to claim the credit, the progress we’ve made is down to you.

It’s your ambition and tenacity that mean we’re seeing ever more employers and young people reap the rewards of apprenticeships.

So on behalf of this government: a huge and heartfelt thanks for all your efforts.

But now is not the time to take our foot off the gas.

We need to make sure the supply of places keeps up with demand. Step up the drive for quality as well as quantity.

And we need apprenticeships doing more than ever to give more young people the chance to realise their ambitions in a fast-changing global economy.

That’s why need we more businesses to champion brilliant apprenticeships that become as fiercely coveted as a place at one of our top universities.

Today I want to tell you that this government is backing you all the way to make that happen.

How we’re putting you – employers – in the driving seat to lift standards and transform apprenticeships so they become truly world class.

How, for the first time, we’re putting you in charge of funding. And supporting you to make the changes you tell us are needed to help your businesses grow.

The challenge

The challenges we face are well-known.

We’re competing in a global race where the link between education and economic success has never been more important.

Yet as we know, too many of our young people are leaving education ill-prepared for the world of work.

Lacking the right skills, especially decent maths and English…

Or the right attributes – good communication, self-motivation, confidence and character.

Vocational education, more than any other, is meant to bridge this gap between schools and business.

But too many of our young people were left without the skills to realise their potential.

This has been confirmed by one international comparison after another.

Take the recently published PISA tests…

Or the OECD’s adult skills survey – which found the UK is unique in failing to equip today’s school leavers with better maths and English skills than their grandparents.

Or recent OECD findings that even our richest pupils are being beaten in maths by poorer children in Shanghai and Singapore.

None of which will come as much surprise to employers struggling with recruitment.

A recent study by McKinsey found that around a quarter of employers had left entry-level vacancies unfilled and that a third had lost out on business opportunities because they couldn’t find recruits with the right skills.

This is at a time when youth unemployment, though thankfully falling, remains far too high.

So all the figures, all the feedback – whether from international comparisons or the testimony of employers and young people themselves – they all say the same thing: our education system isn’t delivering and needs reform.

It’s failing to equip young people with the skills employers want. This hits employers’ bottom line, harms our country’s ability to pay its way in the world, and worst of all hits the prospects of millions.

The opportunity

But it doesn’t have to be like this.

We can and must do much better, raising aspirations across the board, so that every child is stretched and inspired to achieve, regardless of background. So all can reach their potential.

How? By increasing the rigour and responsiveness of the skills system.

We’re taking this approach with academic and vocational education, so they’re united by excellence and prestige rather than divided by them.

So that education and employers come together and get young people ready for the world of work.

Vocational education has an especially vital role to play in this respect.

For too long, weak qualifications mushroomed under a political culture that wasn’t honest about what they were worth.

Letting down both the students taking them and the employers who were left to pick up the pieces.

So in reforming vocational education, we’re zeroing in on rigour and responsiveness as never before.

Rigour

Rigour means expecting high standards across the board.

We’re transforming qualifications, removing the poorest from league tables. And working with employers and others to develop top calibre qualifications like the new Tech Levels, a high quality alternative to A Levels; first announced in December.

These, together with a core maths qualification and an extended project, will count towards the new TechBacc measure – an ambitious benchmark for the brightest students.

We’re also making sure that young people who don’t get at least a grade C or above in GCSE English and maths – the bare minimum employers expect – will have to continue studying these subjects to 18. Failure is no longer good enough.

And we’ve introduced traineeships for young people who need extra support to prepare for work.

These combine high quality work experience, training in the attitude and skills employers value and the core disciplines of English and maths.

They’re already filling a vital gap.

Helping young people move from education into employment and, indeed, on to apprenticeships where they can learn and develop. We expect many trainees to follow this route.

They can be confident they’ve made a good choice.

With our reforms to drive up quality, apprenticeships are truly taking off – through tougher standards, especially in English and maths, grading throughout, more assessments at the end, and a requirement for apprenticeships to last a minimum of 12-months.

With household names and new industries alike embracing them – and, increasingly, taking the lead to reinvent this historic tradition for the 21st century.

Trailblazers

As you know, some of our biggest businesses and trade bodies – and crucially, many of the smaller firms that supply them – have been at the forefront of these reforms to apprenticeships.

Trailblazers across 8 sectors – that include BAE, the National Grid, Cisco, Jaguar Land Rover, the Institute of Mechanical Engineers, Nestle, the Royal Society of Chemistry and Santander – are quite literally rewriting the rulebook.

Condensing hundreds of pages of complex, messy frameworks to a 2-side description of the skills, knowledge and attitude employees need to demonstrate in a particular industry. And how they should be assessed, whether through written tests, practical observations or interviews.

Shorter, clearer, better standards written by employers for employers against which they can easily measure themselves.

Expressed in language they can understand, drawing on international expertise to match the world’s best.

We’re publishing standards for these first 8 trailblazers today alongside details of the next wave of trailblazers who will follow in their footsteps.

Delivered in just 4 months, they’ve been conceived entirely by employers: employers who are telling us what apprenticeships should do and how they should do it.

This seems blindingly obvious now, but in the past, unbelievably, it was done the other way round.

So we are ending the maze-like systems that were often a mystery to the customers: the very businesses whose buy-in was so critical to their success.

Of course, there’s much more to still do.

The next challenge will be for the first trailblazers to make these reforms a reality on the ground, but seeing the pivotal role that employers are taking gives me great hope.

They’ve certainly set a blistering pace for the next 29 trailblazers announced today by the Prime Minister.

Spanning sectors from accountancy to aviation, nursing to retail, these too include small businesses and sector specialists as well as some big names – Tata Steel, John Lewis, British Airways, BMW.

I can’t wait to see what they achieve.

But while it’s great to see businesses raising standards in this way, this work can only have a real impact if the funding follows the best training.

There can surely be no better way of ensuring education is responsive than putting money into the hands of employers.

They can then decide which training best meets their needs and buy it – providing a boost for the best and encouraging others to raise their game.

These changes and our decision to route apprenticeship funding through an HMRC system were announced in the Chancellor’s Autumn Statement.

We’ll be launching a consultation shortly on the details.

Whatever we decide on needs to be straightforward and accessible to businesses of all sizes.

So I want to hear from you.

Conclusion

Because opportunities like this – to reboot apprenticeships and transform vocational education don’t come along often.

There are more apprentices today, working for more employers and in more sectors, than ever before.

And with businesses moving centre-stage as never before, apprenticeships are better than ever.

More rigorous, more responsive, more ambitious.

Helping nail, once and for all, the mismatch between the skills employers want and those young people have to offer.

Taking vocational education to a new level where it becomes a badge of pride rather than a mumbled apology.

And helping employers tap into the vast reservoir of talent we have in this country.

To build a high-quality workforce and maximise their productivity, now and for the future.

And to make the changes that are needed to put us in pole position as a country to compete and take full advantage of the growing recovery.

So I urge businesses to get involved wherever possible.

The National Apprenticeship Service is on hand to help and advise.

And there’s government help for those who want to develop and run their training in-house – as around 100 employers have already done.

You won’t regret it. The approval ratings for apprenticeships, from both an employer and apprentice perspective – are off the scale.

And if you still have any doubts, ask yourself if you’d like to have a say in the way we train future generations of inventors, engineers and entrepreneurs – or whether you’d rather leave skills policy in the hands of central government, with its track record of success.

But above all, ask yourself what your most precious resource is – for most of us, it always come back to our people.

Thank you.

Below is the text of the speech made by Matthew Hancock, the Skills Minister, in London on 28th January 2014.

Introduction

Thank you, it’s a pleasure to be here.

It’s a good week for a skills conference.

Because exactly 70 years ago, in January 1944, Parliament was discussing the big wartime issues.

Questions on the availability of wallpaper.

A statement lifting restrictions on men’s suits – letting tailors add pockets.

And a short debate on whether the home guard should be allowed to wear kilts.

To which the government’s answer was – no.

But they were also looking forward to life after war.

Almost on this very day, Parliament passed the Butler Education Act.

The Act is famous for establishing grammars and secondary moderns. But it also aimed to create vocational schools – so that there were good technical options, too.

Now a lot’s changed since 1944.

Wallpaper is abundant. My suit has several pockets. I’m reliably informed the TA have kilts – if they want to.

But that idea – of equal prestige for vocational and academic routes – it still burns strong.

And that promise – of good education for all our young people – is every bit as important.

On the anniversary of this landmark legislation, I want to talk about how we see vocational education. About what happened after Butler, and where we are now.

And about a new generation of elite vocational education institutions – that might finally win vocational education the status it deserves.

What happened after Butler

Of course, there were attempts to improve vocational education before Butler.

Like the leading figure who felt Britain didn’t celebrate manufacturing enough – that there was a gulf between traditional and technical education – and who worked hard to raise the status of mechanical craft and industrial design. That’s Prince Albert – who helped set up the 1851 Great Exhibition to tackle the problem.

The Butler Act, 90 years later, aimed for the same thing. It raised the leaving age – and introduced the idea of secondary technical schools.

But while grammars and comprehensives spread across the country, just a handful of secondary technical schools were built.

We struggled with that legacy for decades after.

In the 60s, we had some important developments – a new Open University –the Robbins Committee turning colleges into universities.

In the 80s, we had the energy of Kenneth Baker – the champion of NCVQ, City Technology Colleges – the man who freed colleges from local authority control.

This was a principled response to the failings of the forties.

But then came the frothy years of the late 1990s and early 2000s.

There were many warm words about vocational education – while at the same time, colleges came under ever-growing central control.

And governments were so obsessed with the idea that half our young people should go to university – dazzled by an arbitrary number – that they quietly forgot about the rest.

Pattern the same – until now

Well not now. Not on my watch.

Some things might seem similar to 1944.

There’s a coalition government.

We’re in a tough spending environment.

But this time – we are determined to break the cycle.

To persevere despite the challenges –to focus, not to falter – until every young person has the chance to thrive – to do all we can to create a world-class vocational system.

How are we doing that?

So what are we doing to achieve that?

We are increasing the rigour and responsiveness of the system.

Because vocational and academic education will only be valued equally when they are equally valuable.

Take apprenticeships.

Instead of being designed by committee, using complex, messy frameworks – we want clearer, better standards, written by employers.

Our 8 trailblazers are already helping us prepare reformed apprenticeships.

They’re in sectors from finance to food, aerospace to auto engineering – and are all committed to developing apprenticeships that are more responsive to employers’ needs.

That’s combined with higher standards. Proper graded assessments, especially at the end, higher requirements for maths and English – and a minimum of 12 months in an apprenticeship. These things make for more meaningful training.

And we want more apprenticeships, too.

We had a record 868,700 people participating in apprenticeships in 2012 to 2013 – a 7.7% increase on the previous year. Over 1.5 million applications for vacancies over the 12 months to October 2013. An average of 11 applications for every apprenticeship. We recently announced £40 million more funding for higher apprenticeships by 2015 – and the number of higher apprentices has more than doubled between 2011 and 2012.

We want the norm for young people to be choosing between university, or a high-quality apprenticeship.

And these numbers are encouraging.

We’ve also introduced new study programmes – getting 16-18 year olds to do qualifications that lead to a job, rather than ones they could simply complete.

We’ve introduced traineeships, for those who are not quite ready for work – extended work experience to give a better immersion in real workplaces – and want everyone to carry on learning maths and English to age 18 if they haven’t achieved a GCSEs by age 16.

We’re reforming qualifications to meet the needs of employers, and in December we confirmed the first tech levels – advanced qualifications marking out the skills that an 18 year-old needs to enter work in any given subject area.

While accountability will be more consistent across different types of institution.

And on the participation age – where Butler aimed, we are delivering. From 2015, every child will be in education or training – whether in school, an apprenticeship, or work – right up to 18. We’ve committed funding to make that happen – spending over £7 billion on 16-17 year olds alone this year.

Now, there are some who say that children are either academic, or not – you’re either for academic education, or you’re against. And so restoring rigour lets them down.

This is patronising, and wrong.

Because only by demanding rigour in vocational education do we offer truly equal choices to young people.

Only by demanding rigour can they gain meaningful, valuable skills.

Only by demanding responsiveness can we offer employers the workforce they need.

Rigour and responsiveness: only by insisting on it, can we can ever live up to the promise made, 70 years ago this week.

And think about institutions

But we need to think about institutions, too.

And in particular, colleges.

For too long, they were seen as delivery arms of the state.

The vast majority of colleges receive a large proportion of their funding from the taxpayer.

But the vast majority of adult training spending is by the private sector.

That’s enough to tell us too many have a nineties mindset as outdated as Britpop and the millennium bug – of passive deference towards the centre.

Employers will only value training when the training is valuable.

So colleges – and vocational education – will only be high-status when they look outwards.

I’ve met many great colleges. That look outwards to their students and business community – not upwards to central government. That see themselves as leaders – rather than waiting for central diktat to organise them.

That see themselves as social enterprises.

That’s what we want to see.

So get out there and sell your talents.

Not to ministers – but to students, parents, and businesses – and more than anyone, to employers.

A new generation of elite institutions

And I am delighted to announce that from this year, we will plan a new generation of elite vocational institutions.

Like the Manufacturing Training Centre, in Coventry.

We are investing £18 million on a new facility, developing the most cutting-edge skills for advanced engineering.

It will provide advanced, 4-year apprenticeships in areas like automation, additive layering, laser machining. It will offer international placements with the best engineering firms – and support graduates to become chartered engineers, and ultimately go on to develop their own products and companies.

Or the HS2 college, announced just the other week.

HS2 should create some 2,000 apprenticeships. That’s a huge opportunity for our young people – and for Britain to become a world leader in infrastructure. So the college will provide the very best training in rail engineering, environmental science and construction – to take advantage.

Or a new nuclear college.

In the next 20 years, some £930 billion will be spent across the world on new reactors – and £250 billion on decommissioning old ones. In Britain alone, 40,000 jobs could be created.

So the new college will build on the industry’s work – and provide the specialist, advanced skills to meet that demand – and then sell that expertise to the world.

Which share same commitment to excellence

These are new institutions, sharing some guiding principles.

They’re industry-led. Their training is directly tied to the needs of employers in strategic, high-value industries. And they’re financed by government and employers working in partnership.

They’re independent. They are autonomous, ambitious organisations – that take responsibility for their own future, and for their students’.

But most important of all – they’re excellent.

Just like the best existing colleges – they aim to be the top. Not just in the country – but in the world. To become renowned and recognised for an exceptional, elite education.

That’s obviously good for the individuals who attend.

But it also helps the wider reputation of vocational education.

By growing and nurturing these elite centres – adding them to the hard work and quality that already exists – we can win over hearts and minds for the whole system.

Think about the academic elite. Universities like Oxford, Cambridge, Imperial – their success is good for the entire HE sector. It drives up standards. It draws researchers and students to the UK. It prompts other institutions to refine their offer to students. It commands prestige and cachet for all universities.

And they’re valued by employers – because the education they give is valuable.

Now remember the Alan Bennett play and film, ‘The History Boys’.

It follows a group of pupils, working and joking their way into Oxford to study history.

Last year, this play about this one university – this one elite institution – was voted the nation’s favourite.

Doesn’t that say so much about our culture?

Getting an apprenticeship with Rolls Royce is already as competitive as getting into Oxbridge.

So imagine if our best vocational institutions – existing and new – won the same treatment as Oxford gets in ‘The History Boys’.

If that image of teenagers running downstairs to rip open offer letters – teachers crying with pride at their achievements – parents happy but sad to drive them across the country for that first exciting day – just imagine if all that applied to vocational education.

That would be a huge change.

And that’s what elite colleges aim to lead.

Just as important, they will also start to break down the barriers between higher and further education.

They blur the lines. They take on students from a relatively young age, but go right up to post-graduate level.

And that makes perfect sense, in their industries.

In engineering, taking students up from basic principles to high-end machine work – where does academic start, and technical end?

In nuclear work, beginning with basic physics – and going up to complex, enormous projects – where does academic start, and technical end?

It’s easy to talk about parity of esteem.

These institutions will, in time, make it more than a nice phrase.

They will make it a living reality – a fact of life in the aspirations and hopes of our young people.

Conclusion

With our reforms, and the energy and commitment of all those in further education, we can see a new, emerging landscape.

Our reforms are already increasing respect for vocational education. Trust in qualifications is already rising. There are many great colleges and courses and companies out there.

There’s a long way to go yet.

But things are moving in the right direction.

This month, 70 years ago, Parliament passed a famous bill.

It aimed for equality between vocational and academic education.

We might be living once more in a time of change – of coalition – of tight budgets.

But with rigour and responsiveness – and led by our best institutions – with a new generation of elite colleges – I hope that in 70 years, people say vocational education got the future it deserves.