The Small Business Council has produced its second Annual Report, which includes some interesting reflections on national training policy.

Ths Skills section opens with the declaration: "The current system is not working because the educators largely decide the type and quality of skills provision that is available. The Government needs to stimulate a demand for skills and thereby develop a market for training."

The Council's recommendations for schools are in line with recent government policy declarations: stress on basic literacy and numeracy, more teaching on how business works and relevant skills, job-related training to be given parity of esteem with academic study. On FE, the Council again pushed for greater relevance to employment and more consultation of business.

In order to remedy skills shortages in the labour market, the Council is pushing for better information: "Regional and national information on labour market supply and demand should be collated,analysed and shared at a regional level and should be the strategic responsibility of the Frameworks for Regional Employment and Skills Action (FRESA). This information should be easily accessible by educators, policy makers, local and regional agencies, employers and individuals seeking training and careers
information."

The Council repudiates the notion that small businesses don't train, suggesting that this has become a common misconception because small businesses often train informally, rather than towards a formal qualification. "Almost all employers provide some training, in addition to basic skills provided to trainees/apprentices firms usually provide an induction process,training in regulated areas, extension of current skills and introduction to new services, processes, machinery etc. Much of this occurs simply because businesses have to change and evolve in order to survive." The report also suggests that the belief that small businesses don't train "is currently leading to perverse policy decisions."

This is identified as a major division: "Policy makers still see qualifications rather than skills as currency in a mobile labour market. Without the badge,a person is deemed not to have the skills. However,employers value people for their skills rather than their certificates. Some firms are taking the initiative and are creating a skills ‘passport ’for staff, cataloguing formal and informal training and experience gained. It is beneficial for the employer to demonstrate to staff the way their skills have been enhanced,to inform reviews and highlight training needs."

The report recommends that, to develop a more training-oriented culture, companies need to start at the top: "The more managers and entrepreneurs that benefit from training then the greater investment will occur in training the workforce."

The Council rejects the Chancellor's proposal to compel companies to allow "time off for training", because there is no necessary link between the training available there and businsess needs, and has revived the alternative government proposal Company Learning Accounts, particularly since Individual Learning Accounts have been withdrawn.

Other proposals include: better public internet-based information resources about training; and skills audits within businesses (encouraged by tax incentives).

Main recommendations

- That each region develop a skills intelligence unit which identifies employers ’ requirements and enables employees to develop skills according to local job opportunities. These intelligence units should sit within the Framework for Regional Employment and Skills Action (FRESA)and be collated by the Department for Education and Skills,at a
national level.

- That the Department for Education and Skills undertake research which reviews existing training information and develops an analytical tool capable of accurately assessing the role and importance of informal learning within small businesses.

- That the Government promotes the use of a ‘skills passport ’as a record of training without the use of legislation ’.

- That small businesses be encouraged to undertake a skills audit. The training requirement indentified should qualify for funding via a Company Learning Account.