Nick Boles, MP
, Minister of State for Skills, spoke at a Legatum Institute Business Forum
lunch on the government’s plan to improve UK productivity through greater investment in infrastructure, increased wages and training.
The Minister stressed that improving productivity was now more central to government economic policy than in the last parliament. The Coalition presided over a miraculous employment boom, but had not managed to achieve similar gains in productivity, which will be essential for sustaining people in high wage, good quality jobs.
He emphasised that boosting productivity was the premise for several of the substantial policy shifts undertaken since last year’s election, namely in infrastructure, the National Living wage and the new apprenticeship levy. The government’s decision to sustain new investment in infrastructure, and creation of a new independent commission to analyse which projects to pursue was based on recognition of the constraint imposed by poor infrastructure on productivity growth. (The commission’s chair, Lord Adonis, has previously addressed the Business Forum). The landmark National Living Wage, announced last July, was also meant to incentivise employers to invest more, including in the skills of their workforces, as well as fulfilling an obvious social justice objective. The new apprenticeships levy on employers (his own idea) was designed to stimulate greater investment in skills training by employers, an important pillar of productivity.
The Minister agreed with Business Forum members that a cultural shift towards a greater appreciation of vocational and skills training in the UK was urgently needed, with the government’s aim being to achieve ‘neutrality’ between apprenticeship-style and university education in terms of the advice and opportunities available to school leave.
He also agreed that improving digital education, was an important strand of this question.
In addition, the Minister noted that the gender pay gap affects productivity and where the government is supporting change is through their mandate for companies with more than 250 people to publish any gender pay gaps.
The discussion was moderated by Cristina Odone, Director of the Centre for Character and Values at the Legatum Institute.