Article from The Professional Painter & Decorator - May 2011
Don’t waste the new training money
The crisis in youth unemployment was acknowledged in the last budget, but how can the money allocated be successfully channelled to provide the 40,000 extra apprenticeships that are needed? We discuss this with Kevin Mcloughlin, MD of K&M Mcloughlin Decorating Ltd.
Delivering his budget, George Osborne urged more employers to run an on-the-job training scheme revealing just one in 10 UK businesses did so. In Austria, Germany and Switzerland, one in four employers offered a scheme, he said. He further suggested SMEs (small to medium-sized enterprises) could be the saviour of the unemployed youth of this country and pledged £180 million to facilitate this. Sounds good, but the question Kevin Mcloughlin is asking is: how is this going to happen, what will the process of allocating this be? Now, Kevin Mcloughlin has a right to ask this
question, as MD of the largest independent decorating contractor within the M25 and one which at present has 22 apprentices on its books and has invested heavily in a training facility at its premises.
“I normally have 15 apprentices which are about 10% of my workforce. I’ve gone up to 22 because of the recession, and I’m working them hard, which doesn’t hurt them. I’m not a charity and I couldn’t afford to take them on if they
didn’t make me money. But they do go to college once a week and we make sure they cover all the jobs in the trade, so after three years they can earn a full wage in the trade as long as they are up to speed.
“The apprentices may make money for me, but to do this I have to have a couple of training officers to look after them and, more to the point, most of my employees are PAYE, which adds a good 25% to wage costs compared to
those ‘companies’ using only contract-labour who make no commitment to training whatsoever.
“There is enough legislation to close the loopholes that allow companies to sub-contract their workforce through employment agencies on a long-term basis, when they should be on PAYE and paying all the associated employment costs. Why do the government (and local government especially) still use these contractors, either directly or indirectly, without insisting that they re-invest in their business by taking on apprentices?
“If the government was to insist that contractors stick to the spirit of the law, then there would be a level playing field
and companies would be happy to take on apprentices. This would not only create a natural channel for this £180m to flow into and one that could produce jobs at the end. I really do not want to see this money going into private
colleges or just taking troublesome kids off the street by simply putting them through the existing college system without instilling a work ethic.
“Without a work ethic they are no good for us and won’t continue to work for us when the apprenticeship is finished. Some years, we’ve had to get rid of 60% of our apprentices within the first year. It’s no good if they can’t get up in
the morning or won’t do what they are told. Obviously, they have the same employment rights as adults which gives us a year to sort them out but, in reality, both we and the apprentices know within the first three months if it is going to work. It’s then we sponsor them for college.”
You’ve said you can make apprentices pay, but can you give some more detail about how it works now, even before the £180m is distributed?
“If you are a CITB-levy payer, as we are, you can get a grant. When an apprentice achieves an NVQ2, you get a set payment of £6000, and another £3,000 for an NVQ3. And if these apprentices are CITB-sponsored then all college
fees will be covered as well. On the other side we pay them for 5 days a week, with holidays and all traditional employment rights. It’s good money that increases each year, which reflects how valuable to us they as they learn and improve. After this, they may go on to full wages. But we’ve got a lad who is just about the best wallpaper hanger I’ve seen. Although he’s still in the third year, I’ve put him on full wages because he earned it and that’s the fair thing to do.
“I think our attitude to training has really helped us win contracts. A lot of our work is with major contractors. For example, earlier this year we got a lot of work at the Olympic site and one of the commercial managers there said our
training programme made us stand out.
You’ve recently invested in a training centre at your own premises in which you’ve built a full sized mock-up of a 2-bedroom flat. Why have you done this, what’s wrong with the existing college system?
“I left school and went to college on day release. Everyone at the college had a job and everyone in my first year was 16, 17 in the second and 18 in the third. Our kids go to colleges all around London. The teachers are good, but the
problem is that they may be in a class with all age groups, youngsters who haven’t got a job or adults who just want to learn a little rag-rolling.
We don’t think that they are learning as much or as well as they used to. That’s when we came up with the concept of opening our own school and Dulux Trade has helped us by sponsoring the IT element. Our idea is that when the NVQs are done or being done we can use our training facility to bring them up to the production speed we need to fulfil our contracts. But we are now going one stage further and a couple of our guys are now in the process of
Becoming teachers, so we’ll soon be able to develop into an accredited college where NVQs can be studied.
“Beyond this we have developed a computer programme that dictates the speed the apprentice needs to develop. We encourage them to race each other, but at the same time generate quality work. This is designed to give
us the competitive edge because it shows us just what each employee can do and allows us to tender very accurately. “To me, all this is good business sense.”
We hope the government takes note.
