Speech by: Kevin Brennan
Venue: Congress House, Great Russell Street, London

Good morning.

Let me say how pleased I am that, as national leading employers, you are actively engaging with the Building Britain’s Future: New Industry, New Jobs strategy Government set out in April.

Just this morning I heard first hand some of the challenges and opportunities this strategy places in front of you.

I genuinely believe that we have one of the best business environments in the world. We are one of the largest economic and industrial powers. We have a strong, flexible labour market with increasingly high skills at all levels.

It is important we work together through this extremely tough economic period, and ensure we are prepared to take advantage of the opportunities from the upturn.

New Department

That is exactly why the Department for Business, Innovation and Skills has been formed.

The Prime Minister gave the department a very clear remit to lead the fight against the recession and build Britain’s capabilities to compete in the global economy.

The creation of this new Department expresses the commitment set out in New Industry, New Jobs to build Britain’s resources of skill, knowledge and creativity by taking an active approach.

Investment in education and skills will be an integral part of Government’s economic and industrial policy – getting the right skills, in the right place, at the right time, particularly in growth sectors, such as low carbon.

The future economy is going to look very different. Growing and ageing populations, new technologies and the transition to a low carbon economy all offer opportunities. We must seize and maximise them.

The strong foundations of our skills system

We already have a strong skills foundation upon which to build. Since we published World Class Skills in 2006, we have made excellent progress to increase the skills levels of the nation so we can compete in an increasingly globalised marketplace.

More than 5.7 million adults have improved their basic skills. We have rescued and expanded apprenticeships, with numbers trebling to 225,000 in 2007/08. It offers a way for business of all sizes to develop their future workforce. We have created the Train to Gain service for employers which has been highly successful.

And we are supporting people and business through the downturn. For example, we have boosted the number of apprenticeships by a further 35,000; we are helping people who face redundancy or are unemployed through a package of support; and it is why we have made Train to Gain more flexible to respond to employers’ needs.

We are delighted that so many employers are investing in training their staff in these difficult economic circumstances. More than 127,000 employers have now engaged with Train to Gain enabling almost 1 million people to begin learning.

Investing in skills is exactly what we should continue to do during a downturn.

What will we to do to build on this firm foundation?

Building on this foundation, Government will do all it can to ensure workers get their share of the jobs of the future in the key industries, technologies and services that drive economic growth and help UK businesses compete in the emerging growth areas.

Procurement

We will make smarter use of Government levers to shape and raise demand for training. One of those levers is maximising the use of procurement and regulatory frameworks in skills development.

Public procurement also plays a key role in encouraging the development of new technologies and providing innovative solutions that provide better public services and respond to societal challenges.

In these difficult economic circumstances, we need to make sure every pound of taxpayers’ money works hard. So Government spending must be harnessed to create demand for new innovative products and services.

So Government is driving change to ensure public sector procurers seek solutions that provide best value for money whilst encouraging business innovation.

Digital Britain

Earlier this month Government published the Digital Britain Report setting out our strategic vision for ensuring that the UK is at the leading edge of the global digital economy and is one of the central policy commitments in the Government’s Building Britain’s Future plan.

So our challenge is to ensure we have a good flow of talent of people with skills at all levels into digital industries. The report sets out how we can do so through school, HE and company training.

Crucially, digital life skills are a foundation for participation and employability in a digital society.

Government welcomes the findings of Estelle Morris’s review on digital skills, and we will look seriously at how we can do more to improve basic computer skills for adults most in need – including the unemployed, those at risk of redundancy and older people – as well as those in jobs.

Innovation and Construction

There are major projects out there which will offer great opportunities for construction and engineering firms, like nuclear new build, rail and renewable energy projects.

We need to ensure the Government and industry do whatever it takes to build productivity and improve skills to help put British firms in the best place to compete for contracts and reap the benefits of innovation.

The Government’s Review of productivity and skills in engineering construction will help ensure this happens.

Low Carbon

To prosper in a global economy and capitalise on the growth opportunities, we must create the conditions for the UK to be the leading place in the world to be an innovative low carbon business, developing low carbon products and services.

Following the budget, we published ‘Investing in a Low Carbon Britain’, which identified the first steps towards putting our vision into practice.

To support this and increase UK capability, the Government announced £405 million will be targeted to help establish UK as a market leader in renewables technology and advanced green manufacturing in the next two years, the Budget also announced a further £50 million for the Technology Strategy Board to increase its capacity for supporting innovation in areas of high growth potential, such as low carbon technologies and advanced manufacturing.

Future

Despite the current economic outlook, longer-term trends remain clear: globally, there is an increasing need for more highly skilled workers. The coming decade offers new opportunities for Britain, with up to a billion skilled jobs likely to be created worldwide in the coming years.

Government has a huge role – through policies on taxation, regulation and expenditure, infrastructure, procurement and innovation – to influence the UK business environment, and help get the right support in place now, during these exceptionally tough times, we can ensure we build for tomorrow.

It is vital firms continue to invest in the skills of their workforce despite unprecedented pressures. In an open letter last winter, the UK Commission for Employment and Skills pointed out that companies that don’t train their staff are two and a half times more likely to fail than those that do.

We must make sure we have the skills required to seize the opportunities of a new global economy and support our businesses through the recession and into future.

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