Pat McFadden will seek to use his new powers over skills policy to curb “wasted potential” from youth unemployment and cut the government’s growing benefits bill.
Details of the major shift in ministerial control over skills policy were confirmed earlier this week when prime minister Sir Keir Starmer revealed that training, adult further education, careers, apprenticeships and Skills England have all moved to the Department for Work and Pensions (DWP).
Writing in this week’s edition of FE Week, the work and pensions secretary said adding skills to his department’s responsibilities would give it a “renewed energy and focus”.
He argued skills and employment are “natural partners” – so DWP-run jobcentres should be able to go beyond “just support or help” with job searches, and also offer skills assessments and “clear routes” to training and employment.
McFadden said his “first priority” would be getting more young people into work or training, to prevent “lost opportunity, unused talent and wasted potential”.
Skills England
Sector leaders have welcomed the skills shift as an example of “more cohesive policymaking” but warned the upheaval risked distracting ministers and officials.
Skills England, a new executive agency set up by education secretary Bridget Phillipson and launched in June, was the latest component to be confirmed as moving departments after FE Week revealed apprenticeships would be shifted last Friday.
Speaking as the Skills England news broke during a business and trade committee inquiry, co-chief executive Sarah Maclean said the move “really makes sense”.
It took the government 11 months to officially launch the body – which was a manifesto pledge – after its general election win last year.
Association of Employment and Learning Providers CEO Ben Rowland said: “Bringing Skills England under DWP creates a real opportunity to join up the support that gets people into work with the skills that help them move up through the labour market.”
Potential complications
The prime minister’s statement earlier this week came with confirmation that higher education and pre-19 further education and careers policy would remain at the Department for Education.
When asked whether the anticipated post-16 education white paper would be delayed by the governmental change, a DfE spokesperson directed FE Week to Jacqui Smith’s interview last week in which she said publication is “forthcoming”.
Other skills policy areas which could present complications for the two departments include careers advice, degree apprenticeships and occupational standards, which are the DWP’s responsibility but inform technical qualifications run by the DfE.
Ben Houchen, Conservative mayor of Tees Valley, said moving the skills brief to the DWP appears logical “in principle” as it should “make it easier to support people into work”.
However, he added: “What ultimately matters is how the DWP approaches this and whether they are prepared to have a more positive mindset towards devolution than the DfE ever has done.”
What’s the plan?
The work and pensions secretary is leading the government’s Get Britain Working strategy to increase employment, reduce the number of people out of work due to poor health or low skills, and lower the number of young people classed as not in education, employment or training (NEET).
The stakes are high, with more than 900,000 young people estimated to be NEET and Universal Credit spending forecast to rise 10 per cent to £99 billion in the next five years, according to the Office for Budget Responsibility.
In media interviews since his appointment, McFadden has said he would “expand” access to skills training, ask DWP officials “tough questions” about their youth NEET strategy, and be “more ambitious” in helping the young people into jobs – including those with mental health issues.
He believes better links to skills and training will turn jobcentres into a “springboard to better futures” in sustainable jobs – but has yet to confirm how it will be done.
During a visit to Waltham Forest College, McFadden praised its sector-based work academy programme (SWAP), a jobcentre-coordinated scheme running across England that offers unemployed people a short programme of work coaching, DfE-funded training and work experience.
However, questions remain about the success of SWAP programmes, used by around 200,000 jobseekers during the last two financial years.
HMRC data suggests only about 40 per cent of participants begin to earn money after completing a SWAP, and a DWP evaluation found that individual earnings averaged at about £1,400 more per year than if they had remained on Universal Credit.
So far, the government’s Get Britain Working strategy has involved a £240 million programme to launch a series of pilot “trailblazer” initiatives, funded by the DWP and managed by regional mayors, to test new approaches to curb youth NEET rates through a local “youth guarantee” and offering unemployed adults extra health support and training.
It has also tentatively launched an overhaul of jobcentres into a ‘jobs and careers service’, although MPs have criticised this plan due to a lack of detail.
Training where it’s needed
Moving skills to the DWP is an opportunity to ensure that adults accessing publicly funded education are those who face the “largest barriers” to employment, experts told FE Week.
The department’s control over apprenticeships is also another opportunity to reverse declining start numbers among young people, in line with Labour’s election pledge to guarantee training, an apprenticeship, or help to find work for all 18 to 21-year-olds.
Naomi Clayton, chief executive of the Institute for Employment Studies, said jobseekers have not historically had access to free training, particularly essential skills which are “so important and valued by employers”.
She added that programmes that combine personalised support and training for specific sectors have been “really effective” at helping both the unemployed and employed people who want to progress.
Ben Willmott, head of public policy at the CIPD, said bringing skills and employment together under the DWP was a “positive step” towards more cohesive policymaking that could “address skills shortages, tackle economic inactivity and boost UK growth”.
He added: “A more ambitious approach is needed to genuinely expand opportunities and rebalance the system in favour of young people, including an apprenticeship guarantee for all 16 to 24-year-olds.”
The SoS for Skills
Pat McFadden has been at the heart of national Labour politics since the 1990s, starting out as a speechwriter and adviser to party leader John Smith before joining the team shaping Labour’s 1997 general election manifesto alongside the likes of Alastair Campbell and Peter Mandelson.
He was a Downing Street adviser to Tony Blair before getting elected himself in 2005 as MP for Wolverhampton South East, a seat he’s held continuously since.
He pledged to be a “champion of learning and opportunity” in his maiden speech in the House of Commons.
McFadden quickly rose through the ranks in the final years of the last Labour government. He was made a junior minister in the Cabinet Office in 2006, then promoted to minister of state in the then Department for Business, Enterprise and Regulatory Reform in 2007.
That department became the Department for Business, Innovation and Skills (BIS) in 2009 where McFadden helped to steer the ‘skills for growth’ white paper.
He advocated expanding apprenticeships, measuring skills policy by employment outcomes rather than qualifications, backed skills accounts and credited Train to Gain as helping “more than one million employees get on in work”.
By October 2010 McFadden had returned to the backbenches and served on the parliamentary treasury committee until 2014 when he rejoined the front bench as shadow foreign office minister.
McFadden has been a close ally of Keir Starmer and chancellor Rachel Reeves, serving as Reeves’ shadow chief secretary between 2021 and 2023 before leading Labour’s preparations for government.
After last year’s election win, Starmer made McFadden his chancellor of the Duchy of Lancaster before appointing him to run an expanded DWP this month.
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