Watchdog hits out at handling of workplace skills

• Scotland's spending watchdog has published a damning assessment of the Scottish government's handling of skills and training - among the most important priorities for the economy.

• Ministers have been slated for "lack of leadership", for lack of clarity of what they want, or of direction to their own agencies.

• Training minister Jamie Hepburn "welcomes" the recommendations for change, and claims improvements are already on the way.

A "lack of leadership". There's a need for "urgent action to ensure essential progress".

These are not the words of an opposition MSP, disagreeing on the direction of Scottish government policy…which is what they do.

This is the auditor general speaking. His role in the spending watchdog is not to judge whether the policy is right or not: it is to find out if the policy is being delivered.

And in the case of skills, his report makes clear that the policy set out nearly five years ago has never come close to delivery.

It's not for want of money. This is not about funding, or about the powers available to Holyrood. Nor does this reach a judgement on the quality of training provision. That's for another day.

This is about leadership, or rather the lack of it - about the way skills and training are provided, co-ordinated and funded in Scotland, and how to mix in-work training with courses at college and university.

Given the persistent weakness in productivity across much of the economy, there are few more important long-term objectives.

Getting training ducks in a row so that government agencies can deliver on £2bn of skills and tertiary education spending each year is a vital part of reaching that objective.

And this matters to individuals. Interest and uptake in up-skilling and retraining, much of it as a result of the experience of pandemic, is running high. If their system isn't working, they stand less chance of getting the skills they want or need.

The intention back in 2017 was to align the funding body for universities and colleges, the Scottish Funding Council, with Skills Development Scotland. Both are overseen by the Scottish government. Or at least, they should be.

The problem identified by Auditor General Stephen Boyle is that the objective was never defined, there was no way of measuring if it is achieved, and there was no direction given to these Scottish government quangos.

There were a couple of pilots, and his report reflects well on one - to find out the training needs of early learning providers, some of them delivered in the workplace and some courses in colleges. The idea was to plan and integrate the sector's needs, to deliver them and then evaluate if that effort had worked well.

But it didn't get beyond two pilots. Left to themselves, the first instinct of most quangos is to defend their positions, their budgets and their ways of working. And that seems to be what has happened, with a confusion of ministers failing to tell them what they should be doing, or to ensure they were doing it.

"The Scottish government recognises that workforce skills are central to inclusive and sustainable economic recovery and growth, but it has not provided the leadership needed to deliver on its skills alignment agenda," says Mr Boyle.

"As a result, the anticipated benefits have not been achieved and opportunities for more efficient and effective investment have been missed.

Wasted on duplication

In other words, money wasted on duplication, little success in co-ordinating data about employers' and employee's needs, and training potential not being taken up, apparently because of neglect, changing personnel and a lack of commitment at senior levels.

A senior director was appointed to drive forward the intention of aligning the work of the skills agency and the post-school funding body. But it took 18 months to make an appointment. Eighteen months later, that person quit, and it was decided there would be no replacement.

By this time, and with an election looming, the Scottish government had fresh, new political commitments to provide a jobs guarantee for every young person, and to develop regional strategies.

A committee was set up to help co-ordinate the agencies, but conspicuously failed to get anywhere. Another one was set up, and three years after the Scottish government had set out its intention to align efforts, one of the first tasks of the new group was to "define skills alignment". That committee was wound up after less than a year.

Turf wars

The auditor general concludes: "The Scottish government now urgently needs to set out what it intends to achieve and how it will measure progress, as well as clarifying the governance and oversight arrangements for skills alignment activity".

A lot of this appears to be bureaucratic, and about turf being fought over by officials. But the consequence is very direct for the economy.

It has become all the more so with the biggest skills shortages anyone can remember - brought on by many people leaving work during the pandemic, and because Europe has ceased to be a pool for new recruits as a result of Brexit.

That said, the minister now responsible for youth employment and training, Jamie Hepburn, says he "welcomes" the report's recommendations. Maybe he does not realise how damning they are.

He looks back before Brexit and the full impact of pandemic on the labour market to a survey of employers from 2020 that shows the skills shortage problems improving on 2017, "and a reduction in the percentage of employers reporting skills gaps within their workforce over the same period".

"Progress has been made in improving collaboration between Skills Development Scotland and the Scottish Funding Council, with more robust Scottish government leadership, governance and accountability arrangements now in place.

"But," the minister concludes, "I recognise more has to be done, and I will be working closely with those partners who have a critical role to play in ensuring these positive trends continue."