Tom Wilson is director of unionlearn, the TUC's learning and training organisation

With the department for Business, Innovation and Skills taking one of the biggest hits with its contribution of £836 million towards the £6 billion plus required by the Chancellor, what does it mean for education and skills?

In the first instance, the reallocation of the £200 million Train to Gain fund means that £150 million will be used to create 50,000 new apprenticeships and £50 million will go towards college buildings.

This is obviously to be welcomed, however it leaves a hole in the budget for funding training for employees. Those who most need it, ie workers with few or no qualifications, could be the first to lose out.

A large amount of NVQ Level 2 training was provided via Train to Gain and it is difficult to tell at this stage what the overall reduction in training places will be as a result; but it is bound to be significant. However there is other good news: the Government has said that spending on 16 to 19 year olds will be protected from any in-year spending cuts.

But worrying, especially in the light of the latest statistics showing that more than one in six 18 to 24 year olds (almost a million) are not in education, work or training, is the shutting down of the Future Jobs Fund and the ending of the Young Person's Guarantee of work.

We at the TUC, saw the Future Jobs Fund as the most progressive employment programme for a generation, offering young unemployed people the chance of a real job, paid at least the minimum wage.

Impacts and Costs and Benefits of the Future Jobs Fund DWP (2012)

The primary aim of the FJF was to build skills and work experience for disadvantaged young jobseekers to assist them in securing long-term unsubsidised employment.

Under all of the scenarios considered in this analysis, the programme is estimated to result in a net cost to the Exchequer and a net benefit to participants, their employers and society as a whole.

Under the baseline assumptions the FJF programme is estimated to result in:

  • a net benefit to participants of approximately £4,000 per participant;
  • a net benefit to employers of approximately £6,850 per participant;
  • a net cost to the Exchequer of approximately £3,100 per participant; and
  • a net benefit to society of approximately £7,750 per participant.

The replacement appears to be some form of workfare scheme – forcing unemployed people to work for much less than the national minimum wage.

Estimates of the number of job losses expected vary, Professor Colin Talbot, of Manchester Business School, puts it at 100,000. The freeze on the civil service and the squeeze on public sector jobs mean that it will not be only quango workers adding to the unemployment figures, but those who will be looking for jobs in the future, including the unlucky 10,000 school leavers who will find no places at university.

Schemes, such as the investment in Nissan's electric car in Sunderland and an engineering project in Sheffield to support the nuclear industry are also under review, in these cities that suffered the worst depredations of the last recession.

Within the world of adult learning, the added £50m for capital is welcome as are the 50,000 new apprenticeship places. Minsters have already spoken very warmly about the value of adult learning and the valuable work of unionlearn. That is welcome and I am confident we can build a constructive and positive relationship with our new ministers in promoting skills and supporting learning in the workplace.

However the TUC remains strongly opposed to the Coalition Government's decision to cut now, when we believe ministers should be concentrating on restoring growth and halting rising unemployment. Of course we understand that the nation's deficit has to be addressed and in that time-honoured politician's phrase "tough choices have to be made". But these cuts will do real damage: to the economy, to children and young people, and to the growing number of jobless.

Tom Wilson is director of unionlearn, the TUC's learning and training organisation

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