Savoy Place, London - 6 May 2008
As always please check against delivery.
Thank you Chris and good morning everyone. Thank you for inviting me here today.
If you asked a theoretical physicist about energy, you'd stand a good chance of being told that it's what mass times the speed of light squared equals. If you asked the rest of the rest of us, the answers you'd get would probably be a lot more prosaic. It's what happens when you flick a light-switch, or turn the key in the ignition, or light the oven.
Some people might point to the link between fossil fuels and global warming. A few might note the enormous amount of money and effort that's now going into the development of greener, less harmful energy sources.
They might even quote the words of that great brutish scientist and Nobel Prize-winner Sir George Porter, who said that 'If sunbeams were weapons of war, we would have had solar energy centuries ago'.
But I doubt that any of them would claim that energy is not an issue of huge national, and indeed, international importance. Of how much we take it for granted until suddenly it's not there.
I was only a baby when this country suffered regular power cuts under Edward Heath's Government and was forced almost overnight to rediscover the candle. But I know that the experience continues to bring home to those who do remember it how fragile our dependence on a constant supply of energy really is.
The energy sector itself is also something that we shouldn't be too eager to take for granted. With well over a thousand businesses and well over a quarter of a million workers, it's a major part of the British economy. And, of course, without what the energy sector produces, none of the rest of the economy actually works.
So when I see the words 'energy' and 'skills shortage' in the same sentence, it worries me, as it should worry all of us. And that's why I'm here today.
We know that skills have been an issue in this country for decades, especially in the technical and scientific fields. And even in the context of the challenging analyses of future skills needs that have emerged from the Leitch and Sainsbury reviews, science, technology, engineering and maths occupy a special place.
Now I could quote figures for the last ten years at you, showing improved uptake and achievement in these subjects at GCSE and A level. I could tell you without distorting the facts that there are more science and technology graduates coming out of our universities these days than there have ever been.
And I could even tell you, equally truthfully, that if three-quarters of them don't end up working in jobs that make use of their specialist skills, then science, engineering and technology employers should look hard at their own recruitment practises before complaining about what the Government or the universities are doing.
Then again, I could say that the energy sector isn't that badly placed. And that the most recent National Employer Skills Survey showed that recruitment problems due to skills shortages were less prevalent in the energy sector than on average. That 5 per cent of employers in the economy generally reported having skills shortage vacancies compared to 4 per cent of those in the energy sector.
I could say all that.
And all of it would be true.
And, my friends, all of it would also be entirely beside the point.
Because we're not going to resolve the serious skills issues that confront us in this country by passing the buck or moaning that other people aren't doing enough. The only way we're going to do it is by recognising that all parts of the skills supply chain from primary schools right up to employers face real challenges, and that how successfully they tackle them will determine how well all the other parts of the chain work.
We must also all get real about the magnitude of what needs to be done. Because the challenge isn't just to producing perfectly-skilled 18- or 21 year-olds - what the dreadful jargon of the higher education sector calls 'oven-ready graduates'. Three-quarters of the people who will be our workforce in 2020 have already left education. We can't just take them out of their jobs for however long it takes to train or retrain them. We need to reach them in their workplaces.
And that means that we're all going to have to roll our sleeves up and start working together.
From my perspective as Skills Minister, one of my most important tasks is to ensure that employers, as the ultimate end-users of skills, need to brought right inside the education and training process.
And I'm optimistic that this is already happening.
When I look at the businesses that have already signed the Skills Pledge, I see some of the biggest names from the energy sector on it - Shell, the National Grid, EDF Energy, Northumbrian Water and others.
It's time for the rest of the sector to follow their lead.
Employers are also getting involved on other fronts. For example, the launch of the National Skills Academy for Nuclear at the end of January 2008 is a particularly welcome step in addressing the skills challenges faced by the nuclear industry. The vision of NSA Nuclear will be to 'create, develop and promote world class skills and career pathways to support a sustainable future in the UK Nuclear Industry'.
My Department will be investing over £9 million in the Academy, while employers - including AMEC, British Nuclear Fuels, British Energy, British Nuclear Group, Centronic, Doosan Babcock and Fluor - have pledged a further £8.5 million. Other stakeholder contributions brings total package to over £20 million. That money will support over 15,000 learners in the first 5 years. It will deliver 1,200 apprenticeships, 3,600 NVQs and 160 foundation degrees in the first 3 years.
This National Skills Academy provides a huge boost to the Nuclear Industry. It puts employers at the heart of the training process, giving them the opportunity to directly shape all aspects of the design and delivery of skills training in the nuclear sector.
The Academy has selected the Universities of Central Lancashire and Portsmouth to jointly develop and deliver leading-edge Foundation Degrees that are needed by the nuclear sector to support job progression opportunities. The universities will work with the NSAN and other partners to provide foundation degrees for school leavers, new entrants and individuals retraining.
The recent announcements on the future of nuclear power in the White Paper Meeting the Energy Challenge has made the role of the National Skills Academy even more critical than when the proposal was first put together. The changing skills mix required by the nuclear sector, demands increased flexibility and mobility. As the transition from operating, to decommissioning, through to new build takes place, a flow of matching skills will be needed. Activity isn't confined to the nuclear industry, either. Cogent have been heavily engaged in the two new Diplomas in Engineering and Manufacturing, planned for launch in September 2008 and 2009 respectively. It will also be involved in the new Science Diploma.
Energy and Utility Skills have also been working to develop the Engineering Diploma as well as the Construction and the Built Environment Diploma planned for launch in September 2008 and the Diploma in Environmental and Land-based Studies to follow in 2009.
Meanwhile, Cogent have formed a partnership in the East of England with EU Skills, SEMTA, ECITB and Skills for Energy to help develop an Energy Apprenticeship and an Energy Foundation degree.
I visited the World Skills Olympics in Japan last year. So I'm particularly excited that SEMTA and Cogent, together with the trade unions Unite and Prospect on the development of a new energy-based competition for World Skills 2011. This new competition will help to showcase the range of interesting careers available in the energy sectors including the oil and gas industry, and will generate positive publicity about career opportunities amongst schools and young people.
More joint working with employers is going on in higher education, too. And that will be reinforced by a new Government strategy for high-level skills that my colleague Bill Rammell published last month.
This acknowledges that it's the joint responsibility of universities and employers, working together, to produce more employable graduates, with the particular skills sets that the economy requires.
Sector Skills Councils like Cogent and EU Skills have a key role in helping industries within their footprint to articulate employers' needs. But we will continue to work with the CBI, higher education institutions and others to promote the value of studying languages and undertaking periods of study and work experience abroad. We will also encourage the provision and use of a range work experience opportunities. Overall, we want all universities to treat student employability as a core part of their mission.
All these are reasons why I welcome the choice of theme for your seminar today. I hope that having come here today will help us all return to work tomorrow with lots of new ideas and, above all, with a renewed determination to make sure that the energy industry gets the skills it needs.
Thank you.
