Tecs, set up to train local workforces and stimulate enterprise, are inhibited by government bureaucracy. The Tecs want more flexible rules in order to increase the Employment Training scheme's dismal success rate.
Two years after their launch, Training and Enterprise Councils are firmly established, but they are struggling for more independence from Whitehall.
Set up by the Government two years ago, Tecs operate as private companies, albeit non-profit making, but are almost entirely funded with public money. There are now 82 Tecs in England and Wales. Their principal task is to administer the Government's two main training programmes for the unemployed: Youth Training (YT), which guarantees training for all the unemployed aged 16 to 19 and Employment Training (ET), which caters for all adults out of work for more than six months. Most administrators however see their Tec's long-term priority as going far beyond training the jobless and are particularly concerned with stimulating local business. Ian Wright, the marketing director for Thames Valley Enterprise, the Tec covering Berkshire, says its aim is, "To help make the Thames Valley community the most successful in Europe". This is taking longer than anticipated because, Wright explains, "Our long-term focus of improving business practice and upskilling people in employment has switched to dealing short-term with the problems of the recession."
Although the bulk of Tec budgets is currently spent on ET and YT, most can also offer a wide array of support services for local business, targeted mainly at small companies. These usually include seminars on skills such as bookkeeping and computing, attaining BS5750, taxation, databases and information services, as well as some free advice or consultancy.
The South and East Cheshire Tec is particularly keen on giving business support. It spends around 10% of its budget on this, rather than the usual 5 or 6% allocated by other Tecs. In the summer the Tec, with local councils and development agencies, launched a new campaign to publicise all its enterprise services, and it intends to increase the resources it allocates to these activities.
All Tecs are now heavily involved in running the Investors in People (IiP) scheme. IiP is a quality standard for training (see Companies). The Tecs are the sole point of delivery of information and help regarding IiP, and they clearly consider it an important task. Many, however, wish this new responsibility had brought them extra support from the Government. Ian Wright points out, "The Government manufactured the IiP standard. They need to brand it nationally with an advertising campaign. Tecs are the retailers delivering it at local level." The introduction of IiP is a good example of the difficulties that have arisen between Tecs and the Government. As Gwynneth Flower of the Central London Training and Enterprise Council, Centec, observes, "They give us the problems but in general they don't give us the resources to deal with them".
The London Tecs, acknowledged by everyone outside government to be seriously underfunded, did not sign their budgets until half way through the latest financial year because discussions with the Department of Employment had been so fraught. Flower walked out of the first budget meeting, never to return in person. She would prefer a negotiated contract, in which the Tec agrees to provide certain services for a certain amount of money. More services would require a contract amendment and more money. Not surprisingly, the Government does not like the sound of a commercial deal with the Tecs.
Indeed, funding is likely to get tighter, partly because of general pressure on public expenditure, and partly because demographic change will mean fewer 16 to 19-year-olds. Most Tec money comes from the Department of Employment budget, though there is some from the DTI. More will have to be gleaned from commercial activities in future. This will mean Tecs offering more consultancy and business services, mainly for small firms.
Critics argue that commercialism will distract Tecs from what they should really be doing, namely, matching unemployed people with businesses' labour needs. Gwynneth Flower is particularly concerned that Tecs' priorities are shifting away from the people at the bottom of the job market heap. "We have a very real problem of people living in a culture of despair. To get them to adjust to the dynamics of the working population is difficult." There are some people, she says, who cannot see themselves ever having a job, and who go blindly through the various training courses on offer." This makes it all the more difficult to get the best return on the money the Tecs spend.
Administrators have for some time been pressing for a reform of the Employment Training scheme, and their lobbying seems likely to meet with some success. At present, ET places can only be offered to people who have been unemployed for more than six months. This means that some people who could be moved into new jobs early on in their unemployment have to hang around; and it also excludes people such as women returning to the workforce after a lengthy gap. The Tecs want more flexible rules in order to increase the rather dismal ET success rate - only about a third of people on ET get a job at the end of their training. Tecs would prefer to retrain those who stand a good chance of becoming employed as a result, at the expense of the less employable.
The Tecs want more flexibility altogether in how they spend their money, with accountability guaranteed by a proper audit rather than administrative fiat. Not the least of their demands is a desire for a three-or five-year funding agreement instead of the fraught annual budget round.
Ian Wright of Thames Valley enterprise says, "The Tecs were established to respond to local needs but we cannot always switch funds. A lot of the funding is targeted by the Department of Employment at specific areas and the only flexibility we have is at the margin."
New freedoms would probably have to mean extra measures of performance so that the successful Tecs could be rewarded and the less successful brought up to scratch. To some extent this already goes on. Tecs whose youth trainees meet particular targets for winning National Vocational Qualifications, for instance, are paid a bonus (see Companies). The Tecs which cannot attain the targets just have to do without.
Administrators themselves acknowledge that some of the Tecs are below standard. The problem is that while they are trying to bring a whiff of the marketplace to the provision of training, the Tecs are nonetheless not subject to the discipline of competition themselves. They have only the discipline of government.
One businessman who has had extensive contacts with Tecs draws a gloomy conclusion about the tight rein on which they are held: "The private sector skills that the Government has tried to bring into Tecs are being neutralised by the way they are forced to operate." His own Tec, he says, is well-meaning but too stuffed full of civil service mores to be effective. He would not join its board. "There is no attraction for talented people under the current regime. They have no freedom and the funding is ever-tighter."
The way that government policy is putting people off is a major problem for Tecs evolution from their uncomfortable position halfway between privatisation and the public sector. About a fifth of the 82 Tec chief executives are from the private sector, as are around two-thirds of the board members in a typical Tec. Many of these feel that two or three years' service is enough. Their replacements might be hard to find.
The optimistic view is that the Tecs' cultural stance is too well established to be reversed and that they are slowly making progress in their demands for more freedom. Still, without the commitment of private sector talent the Tecs could well lose their battle for independence.