Government must recognise the training and investment by firms in their staff

23rd April 2007

British workers are wrongly branded as low-skilled because the national qualification system does not recognise the excellent training schemes many undertake at work, the CBI has said...

It is urging the government to reform the qualifications framework to ensure that high quality training given to staff is recognised, as Lord Leitch proposed in his recent skills report and acknowledged by ministers.

Allowing companies to award their own nationally recognised qualifications would be a vital first step to achieving this, the group said in a report published today, Shaping up for the future: the business vision for education & skills.

UK businesses invested £33bn on staff training last year which, as a share of payroll, was the highest in the EU and considerably more than France, Germany, the US and Japan.

But only one pound in three spent was recognised with a formal award and the UK ranks poorly in the international league table of staff with intermediate qualifications, like NVQs. Just 40% of British adults have such a qualification compared to 57% in the USA and 63% in Germany.

This is not because UK workers are less skilled than their overseas counterparts, the CBI said, but the primary focus of employers is on developing their staff's abilities, rather than acquiring qualifications.

Companies like Rolls Royce or Nissan, for example, provide first class training which too often goes unrecognised by the national qualification framework. Many smaller firms also operate very good training which falls between the cracks in the system.

The government should recognise the value of this training by giving employers who train their staff the same power to award qualifications as universities who give diplomas and degrees to their own students.

As well as tackling the fallacy that British workers are poorly skilled, it would also help attract more inward investment to the UK as the country rises up the league tables of skilled workers.

John Cridland, Deputy Director-General of the CBI, said:

"You don't need to be a rocket scientist to understand the UK will only maintain its place in the leading group of world economies if it has a skilled and flexible workforce.

"But UK workers are wrongly branded as laggards in the skills stakes even though employers are spending more on training than in the rest of the EU, the US and Japan.

"Our best schemes deliver results on a par with anything the rest of the world can offer, yet too much of what employers currently do just is not measured in the national qualification statistics

"The qualifications framework must give official recognition to the training provided in many firms and ensure that the skills of UK employees are accurately reflected, as both Lord Leitch and ministers recognise."

The CBI highlighted the Australian approach of licensing firms to award nationally recognised qualifications as a good model for the UK to emulate.

Training benefits both employee and employer, the CBI said, as staff learn new skills, get a qualification, and boost their earnings and their job mobility.

At the same time, firms enjoy greater productivity and lower staff turnover, research shows, as well as higher skill levels in their sector and supply chains.

As a first step towards recognising in-house training, the CBI wants the government to set up pilot schemes to road test the best training methods and discover how the self-accreditation idea could best be implemented.

The national cost of administering the self-accreditation process has been calculated at £470m and the CBI has included this in its submission to the Treasury for the forthcoming Comprehensive Spending Review.

In parallel, to help smaller firms, the CBI wants the government to re-establish the Small Firms Initiative. This offered companies of between 5 and 49 employees help to audit the skills they possess, highlight areas of improvement and develop an achievable training plan.

The CBI also wants the government to help smaller businesses obtain 'Investors in People' status which revolves around establishing a training and investment programme. About 40% of the workforce currently works for an IiP-accredited firm and the scheme has well-proven benefits for businesses of all sizes.
 

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