Oireachtas Joint and Select Committees
Tuesday, 13 November 2018
Joint Oireachtas Committee on Jobs, Enterprise and Innovation
Ireland's Skills Needs: Discussion
4:00 pm
Mary Butler (Waterford, Fianna Fail)
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I remind members, delegates and those in the Visitors Gallery to ensure their mobile phones are turned off or switched to flight mode for the duration of the meeting as they interfere with the recording and broadcasting equipment, even when left in silent mode.
I welcome from the Irish Congress of Trade Unions Dr. Peter Rigney, industrial officer, and Dr. Laura Bambrick, social policy and legislative officer, to discus Ireland's skills needs.
By virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the joint committee. However, if they are directed by it to cease giving evidence on a particular matter and continue to do so, they are entitled thereafter only to qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person or entity by name or in such a way as to make him, her or it identifiable.
Members are reminded of the long-standing practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official, either by name or in such a way as to make him or her identifiable.
I remind the delegates that their presentation should be no more than ten minutes duration. A copy of the presentation has been circulated to members. I invite Dr. Rigney to make his opening statement.
Dr. Peter Rigney:
The Irish Congress of Trade Unions, ICTU, welcomes the opportunity to address the joint committee on the linked matters of work permits and apprenticeships. What links them is how skills are formed in an economy and whether we make them or buy them in. There are provisions for work permits in the high and low skill sectors of the economy, but it is in the latter that controversy most often arises. There must be a balance between the desire of some employers to recruit people with additional skills and the desire of others to depress wages. According to a memorandum from an interdepartmental group, where employees on work permits are working for relatively low rates of pay, it will tend to set rates and conditions for other workers in the same occupations and sectors.
According to the Central Statistics Office, CSO, the quarter 1 vacancy rate this year was 1.1%, an increase on the 0.5% rate in 2011 but still far below rates prevailing in mainland Europe. The highest job vacancy rates in quarter 2 of 2018 were recorded in the Czech Republic, at 5.4%; Belgium, at 3.5%; the Netherlands, at 3.1%, and Germany, at 2.9%. EUROSTAT recorded Ireland as having a stable job vacancy rate. There may be skills shortages in selected areas, but we are a long way from labour shortages. In its 2017 bulletin report the skills and labour market research unit of SOLAS which is pretty much the gold standard in terms of research in this area, states that while there are shortages in a number of occupations across all sectors of the economy, many of them are small in magnitude and in particular niche areas in which a number of years' experience is required. It is important to bear in mind that while there may be, for example, a shortage of engineers, the positions will not necessarily be filled by people just out of University College Dublin, UCD, Trinity College Dublin, TCD, or the Dublin Institute of Technology, DIT, in Bolton Street as they require engineers with experience. There is a shortage of engineers pretty much worldwide.
There are still 240,000 people on the live register and 17 million unemployed in the EU27. The latter are reachable through the EURES service, but employers make insufficient use of it. The JobPath programme is aimed at Irish residents who are long-term unemployed. The Government has paid out more that €100 million in the last two years to the two JobPath contractors, Seetec and Turas Nua, which operate north and south of the line running from Dublin to Galway. Bringing in a large number of non-EEA nationals on wages at or just above the minimum wage would be counter to the objectives of the programme. We need to examine pathways towards regularisation for people who are perhaps here irregularly. A large number of people have come to this country on student visas to learn English. Some have overstayed their visas and remained in the country illegally. A programme has recently been introduced, opening a path to regularisation. We need to evaluate the operation of the programme, with a view to introducing other targeted regularisation initiatives. One possible criterion that might be used is the possession of a QQI certificate in a work related discipline. Strangely, a person might be in this country illegally as far as one of the arm of the State, the Garda National Immigration Bureau, GNIB, is concerned, but he or she has been through the system and obtained a QQI certificate through another arm of the State. There may be potential to have a regularisation pathway in that regard.
On the question of work permits, we need to learn from mistakes and make policy on the basis of calm evaluation, not news bites. The committee has a good track record in this area. A little less than a year ago it published a report on the operation of atypical schemes in the fishing sector, describing the harrowing tales of exploitation about which it had heard in the course of its work. The same mistakes must not be repeated in other sectors.
On apprenticeships, the development of new apprenticeships has been underpinned by a broad degree of consensus among the various players. The most recent statistical update given to the Dáil in the week beginning 25 October is now outdated on the basis of responses given to questions last week. The SOLAS website lists 41 apprenticeships currently on offer. Of these, over one third, or 14, are of the new generation of apprenticeships. There are a further 11 apprenticeships in development and a greater number in pre-development stage. Apprenticeships were traditionally at level six, but of the newer generation of apprenticeships, seven of the 14 are at level 7, or ordinary degree level, or 8, honours degree level. An example in that regard is the industrial engineering apprenticeship currently provided in Limerick Institute of Technology. The programme seeks to address the shortage of electrical engineers at level 7 or 8 by providing a pathway for existing electricians at level 6 to upgrade to level 7. The attraction for the apprentices is career progression, while for the sponsoring companies it is the opportunity is to grow their engineer talent with people who have a proven track record in the company.
New apprenticeship sectors have developed in biopharma, property services, ICT, finance and logistics. In addition, new apprenticeships have been developed in the electrical and mechanical areas. The number of new apprentices, as a percentage of total apprenticeships, has grown from 2% in 2016 to 10% in 2018. This will lead to a greater number of women apprentices. In the process of recruitment of apprentices, in which I have been involved for over a decade, everything revolves around the CAO dates, particularly the date of offers. It is anticipated that the concept of "earn while you learn" will catch on among young people. It is hoped the expansion of apprenticeships will help to address the problem of dropout and completion rates in the third level sector.
Returning to the question of skills, people will seek to enter occupations that provide good wages and progression rates. They will tolerate low wages while learning in order to have long-term access to knowledge and skills, but they will not remain in low wage, low prospect occupations. People want careers, not jobs.
The Department of Business, Enterprise and Innovation recognises this and has stated in an internal document that some of the labour supply issues in certain industries would be alleviated, if not resolved, by the passing of the banded hours legislation. I am always perplexed to see certain employers describing difficulties in recruitment in certain sectors and almost in the same breath stating that work permits in these sectors should have pay rates pitched at no more than the minimum wage.
Work permits and apprenticeships are linked to the proposition of whether an employer buys in skills or develops them in-house. We have to be cautious with work permits and bringing in people from outside the EU 28 or EU 27 countries. The Department takes the view that one of its duties in the area of work permits is to protect the labour market, but what we are really talking about is the labour market of the EU 27.
The apprenticeship system has been recast and remodelled. A tranche of new apprenticeships has materialised. The numbers involved are small but the percentages are growing. Like any experiment, some aspects of the new apprenticeship may falter but that is an argument for more evaluation and support rather than for knocking the new system.
Kevin Humphreys (Labour)
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I thank the ICTU deputation for a short, sweet and to-the-point presentation. I am starting to see the system of work permits being used to depress salaries and wages. I seek the opinion of ICTU on the pilot scheme for work permits, which is primarily targeted at the meat industry. A total of 800 work permits had been issued for the industry this year as at 5 October. These were mainly for boners who are paid €22,000 per year or €10.35 per hour. I have some concerns in this regard. Currently, employers are advertising on national websites for the same jobs but are including criteria related to accommodation and language skills. There is no clear indication in respect of these positions about who pays for the language skills courses and the accommodation. Is someone coming here from Brazil simply given a link to daft.ie? The problem is with enforcement. The visa is tied to the employer. In many ways, the arrangement is similar to that of an indentured servant. Someone who complains will lose his or her job and, therefore, the visa. We are developing a problem, especially in rural Ireland where people want to see reasonably paid jobs. Work in the boning industry and in meat factories is skilful. It is also physically onerous and workers probably have a short period in that work. However, a salary of €22,000 amounts to not allowing people to access those jobs because employers are keeping people at a low minimum wage. What is the ICTU experience? Does the organisation have any experience of the pilot scheme? Does it have any experience of the overall effect when the visa is tied to the employer? Does that lead to poor conditions of employment in the long term?
Mary Butler (Waterford, Fianna Fail)
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Reference was made to the fact that the committee examined the issue of non-migrant fishers from the EEA last year. One of the recommendations we made was that the permit should not be tied to the position but should go with the worker. We have not had any action on that clear recommendation from the committee.
Kevin Humphreys (Labour)
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In the pilot scheme launched recently the permit is still tied to the employer.
Mary Butler (Waterford, Fianna Fail)
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Yes, that makes it difficult for an employee who is not happy in his role and wants to move on.
Maurice Quinlivan (Limerick City, Sinn Fein)
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What system reforms would ICTU support or introduce to the work permit system?
Dr. Peter Rigney:
I will answer the question in two parts. The first is by way of an allegory. A powerful story was broadcast on television on "Six One" around the time Romania and Bulgaria acceded to the EU. The International Transport Workers Federation, a multinational trade union body, stopped a ship in Dublin Port for non-payment of wages. Those responsible arrested the ship and got money from the ship owner. Ingrid Miley did a lovely Christmassy piece for "Six One" of all these Romanians smiling and waving €50 notes. The interesting thing was that the Ukrainians on the ship stayed on board because they were outside the EU. If people have rights and know they have them, they will feel free to exercise them. If they believe there is a possibility that their permission to remain in the country or their ability to send emigrant remittances – God knows, those of us in Ireland understand emigrant remittances – are in some way conditional, they will tend to keep quiet about it. We are concerned about that.
We spoke about a figure of €22,000. Normally, if the State sets a wage, it does so in a way that involves an emanation of the State. In other words, it does so by way of the Low Pay Commission, the Labour Court or the scheme of conciliation and arbitration for the Civil Service. There is a process in place, under which a person or group in the Department of Business, Enterprise and Innovation decided that a given figure would be the wage. We believe that in the setting of rates for work permits there should be a role for the industrial relations machinery of the State, whether the Labour Court or the Low Pay Commission. That would allow people to come in and make their pitch. I made a freedom of information request and discovered that €22,000 is in fact higher than the minimum wage. According to material we received under the freedom of information process, Meat Industry Ireland wanted the figure capped at the minimum wage. It seems the Department disagreed and made the figure higher at €22,000. To that extent, we welcome it, even if we do grudgingly. The requirement for accommodation and language training is an addition or add-on. It is to be policed by the Department and the Workplace Relations Commission, as I understand it. I have had no information about how that policing has worked to date.
Kevin Humphreys (Labour)
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I followed up that issue. Those responsible will only investigate on foot of a compliant. Both groups clearly stated they would only investigate on foot of a compliant. If a worker's visa is tied to his employer, he or she will not complain.
Mary Butler (Waterford, Fianna Fail)
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Is Senator Humphreys saying that when a job is advertised reference is made to the wage and that accommodation and English language training will be provided? Is that correct?
James Reilly (Fine Gael)
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Is the cost of accommodation and training deducted from the worker's wages?
Kevin Humphreys (Labour)
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There is no clarity on that.
Maurice Quinlivan (Limerick City, Sinn Fein)
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What particular reforms would ICTU introduce to the work permit system?
Dr. Peter Rigney:
The work permit system is particularly complex. Every time a problem arises, those responsible decide to increase the number of permits from 43 to 44 or 45. The issue is difficult. The legislation is updated two or three times each year by statutory instrument. Committee members will know the problem with reading statutory instruments. For example, reference is made to deleting "a" and inserting "the" in paragraph 43 and so on. The main thing we advocate for is clarity in the setting of wages. There is a role for the industrial relations machinery of the State in the setting of wages.
The question of language is important too. It is true that we are a migrating country. I remember doing Irish for the leaving certificate. Two of the textbooks were about migrants. One was Rotha Mór an tSaoiland the other was Dialann Deoraí. The characters in both worked in England, America and Canada. They could all read a sign and dispute their wages with the foreman. We tend not to understand what it is like for people to come to Ireland who speak only Russian or Brazilian and do not really have a clue. An emphasis on language learning paid for by the employer is important. Some enlightened employers in the food sector have staff of long-standing who are eastern European or from EEA member countries. These employers are now paying for language learning. There are people who have been working for ten years and who are good at the job in question. The employers would love to promote them to supervisory positions but they simply do not have enough English to be able to do it properly. Those employers are now providing these types of skills. Language is key to understanding all of society, as is being able to assert one's rights throughout society.
Mary Butler (Waterford, Fianna Fail)
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Dr. Rigney's comments are interesting because another of our recommendations when we discussed migrant fishers was that a translator be provided.
If an official was inspecting a vessel and did not know the language of the person on board who was in distress, that official would not be able to articulate the issues involved. Another of our recommendations was that a translator be provided when such a person was being questioned.
I know that Deputy Quinlivan has to leave early. Does he have more questions or has he concluded?
Maurice Quinlivan (Limerick City, Sinn Fein)
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I have questions about apprenticeships. I welcome Dr. Rigney's comments on recognising drop-out rates at third level in the context of where people are taking courses, for which they are probably not suited, and that an apprenticeship should be considered as a valuable route in terms of people's work prospects. Would he consider putting in place a Central Applications Office, CAO, type application process for apprenticeships? In the past a person seeking an apprenticeship had to know somebody to get one, or apprenticeships were not advertised. What involvement have the trade unions had to date in the development of apprenticeships? Does Dr. Rigney consider they have been sufficiently involved?
Dr. Peter Rigney:
Nobody from the trade union movement will ever say they have been involved enough. We are involved and have two members on the national Apprenticeship Council which operates within SOLAS.
On having a CAO type system, the strength of the apprenticeship system is that there can be no under-filling because it requires an employer to say, "I want a person." In theory, if the national need for stonemasons is 20 per year, there must be 20 stonemason contractors who will each say they want somebody. Therefore, we would not favour such a system. There has to be an interface meeting between the employer and the young person at which the employer can interview the young person and estimate that he or she is suitable. To combat apprenticeships being held by families, there are and have been bursaries for women apprentices, for example, for quite some time in FÁS. However, everyone agrees they have not been greatly successful. I would say the answer is "No" to CAO involvement because it would anonymise the process. I want to be careful in the light of the Chairman's comments, but if we consider the position on quotas, the president of the Irish Universities Association has said some universities game the system by slicing and dicing their courses into small segments to inflate the courses. The CAO system is basically an auction.
The strength of the apprenticeship model is that there is a contract between the employer and the young person. I rarely quote an employer, but one of the IBEC representatives on the apprenticeship committee said that for this system to work, it must be sold to the mammies of Ireland in the context of young people in fifth year asking in October, November or December what they are going to do in terms of pursuing a career. In my first year in college I recall that the first thing I was told was that I was not in school any more, that the lecturers did not care if we did not turn up to lectures or if we did not do our essays because we simply would not pass our examinations, that we were adults and responsible for our own learning. I was okay with that, but others were not and fell through the system. However, if somebody turns up for work on a Monday and is told that he or she is in the job, that these are the tasks they have to do, that he or she will be paid on Friday and that three or six months into his or her apprenticeship he or she will go to an educational and training board training centre or an institute of technology, he or she, first and foremost, will regard himself or herself as being an employee of the company, subject to the normal requirements of company life and if a reasonable request is made of them to perform some task, he or she will do it.
Mary Butler (Waterford, Fianna Fail)
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I note that Deputy Kelleher is indicating. Is his comment related to this reply, or does he have a new question?
Billy Kelleher (Cork North Central, Fianna Fail)
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It is a new and thought-provoking question and I am happy to wait.
Mary Butler (Waterford, Fianna Fail)
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Okay.
Pádraig Mac Lochlainn (Sinn Fein)
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At the end of his presentation Dr. Rigney challenged the employers on pay rates. I want to develop that point further. Does he have evidence, anecdotal or something better than it, of companies that would try to utilise work permits to keep wages low, rather than engaging with their existing workforce? I want to gain a better understanding of the matter. Does ICTU have evidence, experience or concerns in that regard? Dr. Rigney might develop the point further.
My second question is related to apprenticeships. In its submission IDA Ireland points to the need for a greater level of integration with the further and higher education sector. It uses the words "alignment" and "integration". Dr. Rigney might also comment on that matter further, on which he touched on it in his presentation. Does he believe the institutes of technology and the universities are appropriately aligned? He spoke about the importance to an apprentice, while their serving his or her time, of graduating through the various stages of academia and learning. Will Dr. Rigney give us more detail?
Dr. Peter Rigney:
On employers and specific wage rates, we have no direct information as of yet from trade unions on what is happening, beyond whispers. Whispers are only rumours and not worthy of being repeated. If they were to be substantiated, we will take the matter to another place, the enforcement arm of the State. There are plenty of employers who want to pay their employees good wages and give them decent conditions and who are happy to develop learning paths for them. Tá dhá insint ar an scéal.
As I have not seen IDA Ireland's submission, I am not sure what is meant by alignment. The traditional level 6 apprenticeships are delivered in a mix by the ETBs in the old FÁS training centres. Whatever about the bad reputation FÁS had, it certainly was not drawn on it by its apprenticeship system which was pretty good, as the international apprenticeship awards show. The other modules were delivered in the institutes of technology. There should be no reason it cannot continue. If one considers the reply to a parliamentary question, tabled, I believe, by Deputy Kelleher, on the range of new apprenticeships, one will note that the institutes of technology have a strong role in many cases. In some of them where traditionally there would have been 80 apprentices in a class in September, that number would have dropped to 30 or 40 by the following June. Classes will be swapped to have, say, a consistent level of 60 apprentices right the way through in block releases. From the teachers' perspective, they will probably be dealing with a more mature and engaged class. Does that answer the Senator's question?
Pádraig Mac Lochlainn (Sinn Fein)
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I have a follow-up question. Dr. Rigney referenced recourse action. Does ICTU have recourse within the instruments of the State if it is given evidence that an employer has abused the work permit system to keep wages low within a company?
Pádraig Mac Lochlainn (Sinn Fein)
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ICTU has received no evidence of such behaviour.
Mary Butler (Waterford, Fianna Fail)
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For information purposes, the Low Pay Commission now comes within the remit of the Department of Employment Affairs and Social Protection; therefore, there is a cross-over in many areas.
James Reilly (Fine Gael)
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I thank Dr. Rigney for his presentation. There is a suggestion this is being used to depress wages. The meat industry has been mentioned. At what level of wage does Dr. Rigney believe it becomes attractive? There is a problem with the numbers in that area. Certainly, there is a need for this policy. It is a useful and essential policy instrument in a rapidly changing world in terms of the skill sets required. If we consider companies that want to expand in the IT, pharma and other sectors, opportunities come quickly and we do not have the necessary skills. Dr. Rigney asked if we should make them or rent them, in other words, do we hire or create our own? We must do both. It takes a long time to create our own through a training course. If we gear up, it will take a few years, but if the need is immediate, we must do both. I hope Dr. Rigney will agree with me.
In the context of the last question, policing the system is important to make sure there are no abuses. I heard what Dr. Rigney said about there not being any direct evidence, only whispers in the background.
I was relieved to hear the comments Dr. Rigney on language because they answered my question on the issue. Accommodation is part of the package and the cost is not deducted from wages, which is something that happened years ago.
I am strongly supportive of apprenticeships. They suit many people. Dr. Rigney mentioned the lack of supervision and that people are suddenly on their own when they go to college. While it is perhaps no longer as common as it once was, many people who went to boarding school where they were under total supervision used to run into trouble when they suddenly found themselves with a great deal of freedom. There is another more serious situation, which is that even though we have free education the cost of accommodation and supporting oneself is a real challenge. If one is from a larger family it can be prohibitive. People earning as they learn is certainly something I strongly support. I agree with the comment made by the employer about selling apprenticeships to the mothers of Ireland because a bit of intellectual snobbery goes on. I mentioned that while in Germany we visited the Sparkasse bank, which has its own set-up for educating bankers. It is a programme on which people earn as they learn. They make a wage but they also learn about banking. It is good because it instils a particular ethos about community and looking at the business and person and not just at the opportunity to make a commission, which is what got us into so much trouble in the past with regard to banking. Is it fair to say Dr. Rigney is broadly supportive of the apprenticeship programme? How would he improve it, other than trying to expand the areas covered to allow for overlap?
Dr. Peter Rigney:
ICTU fully supports the apprenticeship programme. The most positive statement we could make on the new apprenticeships, which are experimental, is that they should be given a chance to develop. Some of them may falter and if they do, it will not be anyone's fault. If we do not experiment, we will never develop anything new. Some of the new apprenticeships are prospering and doing very well.
While I do not believe a cabal of employers go into a room and conspire to depress wages, the fact of the matter is, and this is according to the Department of Employment Affairs and Social Protection as opposed to ICTU, where employees on work permits work for a relatively low rate of pay, that rate tends to determine rates and conditions for other workers in the same occupations and sectors. It is a weight that drags on sectoral conditions. Some of the complaints I have heard are not from Irish citizens. The bitter complaints I have heard at union meetings are from Polish and Lithuanian citizens who complain about the pressure of non-EEA workers.
This brings me to another point. With regard to the foreign born population, for want of a better phrase, Ireland has one of the highest percentages in the EU. We have been extremely open to migrants in our labour market since 2004. We were one of the three countries that opened up fully to the EU 10, as they were known. People from foreign countries coming to work here is not a problem. The problem is people from foreign countries coming to work who are told they have a particular type of permit, that their stay in the State is conditional and that if they rock the boat, they could find themselves back where they came from. I go back to the ship and the Romanians waving €50 notes on "Six-One", while the Ukrainians stayed on board. That is the fundamental point.
James Reilly (Fine Gael)
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From memory, according to the most recent census, one in five people in Dublin is not native Irish. I absolutely agree with Dr. Rigney's contention that people must be allowed room to make mistakes or they will not innovate. It is a case of nothing ventured nothing gained. I indicated earlier I would have to leave before 5 p.m.
Mary Butler (Waterford, Fianna Fail)
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Yes. I thank the Senator.
Billy Kelleher (Cork North Central, Fianna Fail)
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With regard to apprenticeships in the wet trades and electrical areas, I have always been of the view that there must be pathways out of the traditional areas where we have men up on scaffolding at 55 or 60 years of age. It is not an attractive outcome for any young person making a career choice if there is no further enhancement and development of their skill sets available to allow them to move away from physical roles in later life. This is evident in the construction industry, particularly when there is a downturn in the economy. Many people, particularly men, are physically beaten up after a tough time on the sites but apart from their trade, they have no other skill sets. This is primarily true of the wet trades but it is also true of other areas, such as agriculture, that take a heavy toll on the body. Engineers are one thing because they are mobile and if there is a skills shortage, we may be able to recruit engineers outside the country. We want to enhance and expand our capacity in terms of infrastructural development, housing, roads, sewers and childcare facilities. In terms of our indigenous population and those who come from outside apprenticeship areas, where does Dr. Rigney see us being able to advance and enhance apprenticeship courses to allow people to continue with some form of training as the years progress? Where will they be able to fit into the construction industry other than on the scaffolding or the building site? Does Dr. Rigney understand my concept?
Billy Kelleher (Cork North Central, Fianna Fail)
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The other issue, and this leads me onto questions raised previously, is a pathway and gateway to degree courses and further academic development to master's level for people who may want to take that pathway but are not ready to do so at a younger age. There is very much a "them and us" situation. People either opt for an apprenticeship course in the traditional sense which takes them down one route or they go to third level. The two routes never meet. In Germany and elsewhere, there is a symbiotic crossover of apprenticeships and academic third level facilities. Could we be more creative and imaginative in this area? An apprenticeship course might take people to a level 6 qualification and they could then move to a level 8 qualification and degree courses, before continuing even further.
While the State has been involved in overseeing apprenticeships, traditionally through FÁS and now through SOLAS, is there a greater role for the public sector, multinational companies of all shapes and colours and the financial services sector in providing apprenticeships? Are we creative and imaginative enough in giving either incentives or a stick to these entities to create more apprenticeship places? People may not always have the skill sets to go directly to third level or a financial institution but if they had an opportunity to go in under an apprenticeship scheme, they could develop skills in the system. Are we creative and imaginative enough in this regard?
On the issue of work permits, traditionally a free marketeer or capitalist believes that if there is a shortage of labour, the price of labour will increase and people will flow into that particular sector. Of course, it does not happen like that, particularly in lower skilled areas such as agriculture, parts of construction, horticulture and the hospitality sector. Does the cost of accommodation in this country create the potential for exploitation in view of the fact that, let us be honest, people could be working 40 hours a week for €10 an hour but if the employer's accommodation charges are excessive, it could have a major impact on that person? Is there any evidence this is beginning to happen? In a previous life, I was the Minister of State when we established the National Employment Rights Authority, NERA, which was vilified to be honest. During the previous boom, NERA began to unearth cases in the farming and fishing sectors which indicated that accommodation was being used almost as a prison because people could not afford to go anywhere else. Is this practice beginning to creep into the system again?
Dr. Peter Rigney:
One of the apprenticeships I mentioned speaks to pathways and to a shortage of engineers. It is the electrical apprenticeship at Limerick Institute of Technology, which one can only get into if one is an electrician. The best way to build level 7 engineers is to take level 6 electricians and train them, mainly at the weekend. Purely anecdotally, many multinationals come in with the necessary money and hire hundreds of engineers. They then allocate them tasks which one does not need an engineer to do. Young engineers say they find it difficult to get continuing professional development, CPD, points. They are handling compliance, quality assurance and ticking boxes and it is not real engineering. Companies would probably be better off handling compliance and quality assurance with somebody who has been in the industry for a time, is cute and knows the scams people try to get around quality assurance box-ticking, which we all do, to be honest. There is a global shortage of engineers. Multinationals come in and have the money to hire them by the gross. There must be other ways to build them and some way to ask multinationals if they really need engineers for all these tasks. I know Engineers Ireland has an associate position at technician level which gives a pathway towards being a chartered engineer.
With regard to work permits, an interesting thing in the most recent interdepartmental group was that the Department of Housing, Planning and Local Government was involved. It was not in the previous boom. The Department's attitude was to ask why companies were bringing in people to do work for which there are able people already here in houses. An issue this time with bringing people in from outside the country to do anything is how much more difficult it will be for existing workers to get or to pay for accommodation or to be condemned to four hours of commuting every day. All these things are linked. Traditionally, if we go back to the 19th century, employers built houses. Guinness built houses for its employees, as did many mills and railway companies.
Billy Kelleher (Cork North Central, Fianna Fail)
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Good employers built houses.
Dr. Peter Rigney:
Yes. It may come back to that. Some employers have taken leaseholds on small blocks of accommodation so that if they have people come in, mainly from the EU 28, they can tell them they can settle there for a month and sort themselves out. In Dublin, even a month will not get a person sorted out with anything affordable.
I wish to draw the committee's attention to the role of people who come in on visas to learn the English language. This has worked well and supported the industry which has been cleaned up to a great extent. We thankfully see fewer schools closing up and taking the fees. There is a Bill in the Seanad for new legislation in this area. From what we have seen, it could represent a regressive step. As opposed to mandatory insurance before one moves, there will be a sinking fund such as in the case of the Motor Insurance Bureau of Ireland. There is a danger here that we are going back to the old issue of light-touch regulation. I am conscious of lobbying as the person who does the lobbying returns for the Irish Congress of Trade Unions, ICTU. I give some members and their colleagues advance warning that we will probably lobby about the precise format of that Bill and what it proposes. We think it is a step backwards.
Billy Kelleher (Cork North Central, Fianna Fail)
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With regard to construction trades and apprenticeships, what do we do as people get older? We have not been good at that.
Dr. Peter Rigney:
Traditionally, there was a range of jobs in building. There were not enough but there was a range of jobs. For example, there was the old general foreman of the site, who always tended to be a carpenter. Bricklayers come in at a certain stage and painters at another stage but carpenters are always around so tended to know the game. There were clerks of works. They have almost disappeared as a body. One thing that apprenticeships allow, although it has not been fully developed, is the provision for the development of lifelong learning. I do not want to give employers a bad reputation because many want to do the right thing for their workforce. Employers often say that the people in their 20s are of limited use to them. Maybe they should ask if there is something they can do for people in their 40s with a block release and upskilling course because they know the industry. In a previous role in the organisation, when we were running a health and safety training course, I was collecting the fees in September. I went to the Red Cow Luas construction site and took a wad of money from a dumper driver who said it was a young man's game and he wanted to get into health and safety. That says it all to me. If we want to build careers in construction as opposed to jobs, that is the way forward. That middle bit of the pyramid seems to have been hollowed out, such as the clerk of works and the general foreman. Maybe it is a result of the change to subcontracting. I do not know but we certainly have to look at it.
Billy Kelleher (Cork North Central, Fianna Fail)
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With regard to inspection, is there any role for people who were previously putting the blocks up inspecting the people putting the blocks up? We were probably weak at compliance in building for a time. Is there a role there to progress people into?
Dr. Peter Rigney:
All the Deputy's colleagues asked questions about the unfortunate bother we have got ourselves into over 42 schools. We seem to have downplayed the role of inspection and gone down this road of light-touch regulation which served us so well in the financial sector. For that to happen, there has to be a will for the Oireachtas to say we need to look at building inspection, at what the evidence is, what went wrong and how we avoid it.
Mary Butler (Waterford, Fianna Fail)
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I think the point Deputy Kelleher is trying to make is that someone who is a bricklayer or blocklayer for 30 years can do it until they are 50 but one would hope that they can maybe take on another role of inspection. They may be able to move on.
Dr. Peter Rigney:
That requires a specific intervention. There are many things in third level education that one brings one's life experience to. Mathematics is not one of them. It is probably more difficult to learn mathematics at my age, in my 60s, than it was when I was 16. These things have to be worked at. If one is doing inspection and construction, there are certain things one needs to know about the laws of physics, for example, and how things fall.
Tom Neville (Limerick County, Fine Gael)
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Following on from that point, is Dr. Rigney aware of or privy to any discussions with the Construction Industry Federation and Department about broadening career prospects for people who are now seeking to move into the construction sector? I have read bits and pieces about it in the media and in Construction Industry Federation magazines.
Kevin Humphreys (Labour)
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Dr. Rigney makes an interesting point. I was employed by a progressive employer who was interested in life-long learning and worked with the trade union movement to develop training courses for people as they move through their career and their careers change. At the height of the last boom, quite a number of construction workers moved into the pharmaceutical industry, basically with a leaving certificate qualification. When the collapse came, one had to have a degree rather than a leaving certificate before one could get an interview. The required qualification increased. The State has a role to acknowledge the idea of lifelong learning and career changes. People cannot stay in the meat industry or building trades all their lives. The State has a responsibility to provide an education and outlet to allow people to change their careers at different stages. We need construction workers but a blocklayer cannot work laying blocks in his late 50s. He will not be physically capable of it.
I welcome the expansion of the apprenticeship schemes. My opinion is always to plan for the worst and hope for the best. In the last collapse, people had invested three or four years into an apprenticeship and were not able to finish it. When we are encouraging people to enter apprenticeships, there has to be a commitment that they will be able to finish that apprenticeship and will not be caught three or four years into a cycle when a collapse happens.
If a person goes to university to do a degree, they are safe enough and know the university will be there for the four year or five year degree. The same confidence has to be given to people who want to participate in apprenticeships that they will be able to start and finish, even if there is a collapse in the economy during the period. Nobody was chucked out of university but an awful lot of apprentice electricians were chucked out of their jobs and were not able to finish. We need to do a level of work on that.
Senator Reilly mentioned the whispers in regard to work permits. I work extensively in the inner city. One of the whispers on the go is in regard to work permits in the hospitality sector and related abuses, which I hear about on a regular basis. The other is in regard to the meat industry. It is good in one way when we say 22,000, which sounds like a lot, but it is not for a highly skilled job. In themselves, work permits are welcome but I am anxious in this regard. The witnesses mentioned the statistic that over 15% of our workforce were not born in Ireland yet we do not have the same issues that other countries have, which is welcome. However, we must have a well managed work permit system to make sure we do not go down the avenues other countries have gone down in the past.
There are small issues, for example, the exploitation happening in regard to stamp 4 permissions. I was just talking to a young woman who has a stamp 4 permission which she has to renew. However, because of the flaws in the system, all the appointments are booked and she has to pay a private company to get an appointment. We need to move very quickly in regard to closing down such abuses. This is somebody who wants to work and who we have encouraged to come here to fill a skills gap, but this is now being abused and she is required to go to the private sector. I will be approaching this with a view to ensuring it does not become a drag on wages and that people who come to this country to work and who require a visa are treated to a very high standard. We have not always been that good in such areas. The witnesses mentioned the work this committee has done in regard to the fisheries sector. I certainly would not be holding up my head with pride in regard to how we dealt with some people in the hospitality sector.
Dr. Peter Rigney:
I always enjoy talking to a committee of the Oireachtas. Most people see the theatre of the main House and the debates and do not see the work of committees, where people, without prejudice to their individual opinions, manage to progress matters and to scrutinise legislation. Apart from it being a civic duty for myself and for congress, I always enjoy talking to legislators and talking through the issues.
We have managed to avoid the racism and xenophobia that exists in other states. However, we cannot take it for granted and the price of that is eternal vigilance. Go raibh maith agaibh.
Mary Butler (Waterford, Fianna Fail)
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Go raibh maith agat. I thank the witnesses for attending. It was very informative. We have some further sessions in this area, following which we will produce a document. The witnesses might like to come back for the launch of that document. We will suspend to allow the next witnesses to take their seats.
Mary Butler (Waterford, Fianna Fail)
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I welcome from the Irish Business and Employers Confederation, IBEC, Mr. Tony Donohoe, head of education and social policy; Ms Una Fitzpatrick, director, Technology Ireland; Ms Sinead Keogh, director, medtech and engineering; Ms Claire McGee, senior innovation and education executive; and Ms Siobhan Dean, BioPharmaChem Ireland executive. This is the second session of our meeting to discuss Ireland's skills needs.
I draw the attention of the witnesses to the fact that by virtue of section 17(2)(l) of the Defamation Act 2009, they are protected by absolute privilege in respect of their evidence to the committee. However, if they are directed by it to cease giving evidence on a particular matter and continue to do so, they are entitled thereafter only to qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person or entity by name or in such a way as to make him, her or it identifiable.
I remind the witnesses that their presentations should be of no more than ten minutes duration. The presentations have been circulated to members. I ask Mr. Donohoe to make his presentation.
Mr. Tony Donohoe:
I thank the committee for the opportunity to address it on what is a critical issue for employers. Given the strong performance of the Irish economy, high employment demand has given rise to skills and labour shortages. The policy challenge now is minimise these shortages by developing a suite of interventions which respond swiftly to emerging and future skills need. Therefore, it is appropriate that the committee has asked us to address the issues of apprenticeships and the issuing of work permits, in particular how they might be used to address skills gaps. With the permission of the Chair, I will ask my colleagues to bring specific insights on some of the issues. They represent different sectors within IBEC and have some practical learning in those sectors.
Mary Butler (Waterford, Fianna Fail)
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Excuse me, I ask witnesses to turn off their mobile phones because they interfere with the recording equipment.
Mr. Tony Donohoe:
First, I want to focus on apprenticeships, which have become the subject of significant political attention, both in Ireland and internationally. It is over six years since IBEC was invited to participate on the then Government’s review of apprenticeship training in Ireland. At the time, it was felt that the apprenticeship system, which was limited to 26 craft-based occupations, did not reflect the broad skills needs of the Irish economy.
The review suggested a new model of business-led apprenticeships that could boost skill levels across the economy and help to get people into sustainable jobs.
Companies would be involved in both the design of curricula and in the delivery of the on-the-job element of programmes, some of which could extend up to higher degree level. This would ensure the continuing relevance of qualifications in a rapidly changing labour market. The new apprenticeships could offer a real alternative to ambitious and capable young people, who may be looking for alternatives to direct entry from school to higher education, and would be interested in an earn-and-learn model.
A lot of hard work has been put into a project to turn this aspiration into a reality. Some of us have been frustrated at the speed at which the new apprenticeships have come on stream but, in retrospect, this probably should not be a surprise.
The starting point for any consideration of new apprenticeship models usually includes a reference to the well-established dual systems of countries such as Austria, Switzerland and Germany. Much of the commentary tends to ignore the fact that Ireland cannot simply adopt systems that have been built over generations upon very different economies, labour markets and social partnership arrangements. We also have to acknowledge the reality that apprenticeships, and vocational education in general, tend not to enjoy parity of esteem in a society that tends to define educational achievement in terms of CAO points and entry to higher education.
This is not to say that we do not have much to learn from other national systems. In fact, the apprenticeship review group report tried to distil some of the principles on which they are based to inform a model that could work in an Irish context. We should remember apprenticeships are a distinct model of education. They are not internships or traineeships. They are a deep and academically accredited learning experience in preparation for a specific occupation.
I believe that the new apprenticeship project, as we call it, is beginning to gain some momentum.
The Action Plan to Expand Apprenticeships and Traineeships 2016-2020 sets ambitious, but achievable, targets for the introduction of 40 new programmes and a cumulative total of 33,000 new apprenticeship registrations by 2020. Almost 20 new programmes, in areas such as accountancy, ICT, insurance, international financial services, manufacturing and biopharmaceuticals, have come on stream. The committee will have an opportunity to hear in more detail about some of these apprenticeships from my colleagues.
I will turn briefly to the subject of work permits. When we discuss work permits, it is important to differentiate between labour and skills shortages. Labour shortage refers to a situation in which there is a shortage of individuals willing or available to take up employment opportunities. Skills shortage refers to a situation in which there is a shortage or an insufficient number of trained or qualified individuals in the domestic market to meet the demand.
In the main, the Irish employment permits system has in the past responded relatively well to labour market shortages and surpluses. The mix of permit types, criteria and duration has served us well over the past number of years drawing on market intelligence from the expert group for future skills needs, the SOLAS skills and labour market research unit, the National Skills Council and general employer engagement. This is supported by EU-level analysis which shows that Ireland leads most EU member states in terms of developing labour migration policy that is linked with labour market intelligence, connecting almost all employment permits to identified labour market gaps.
However, as we move towards full employment, the ability to enable future growth potential depends on how well we address labour shortages and respond to shifts brought about by the changing economic conditions facing different sectors. We welcome some of the recommendations made by the interdepartmental Review of Economic Migration Policy such as new measures to attract foreign nationals who have relevant experience in areas such as ICT but who may not have the required academic qualification.
The number of employment permits has been increasing in recent years with more than 9,000 new permits issued in 2017. The IT and health and welfare sectors combined accounted for three quarters of all new permits issued. Nine of the top 20 companies for which employment permits were issued were technology companies. The other 11 were healthcare organisations. New permits were primarily issued for professional occupations with two thirds of all new permits issued for the Dublin region.
As I stated earlier, the current system performs well in general. The highly skilled occupational list is reviewed on a timely basis and engages well with the labour market intelligence available. At an operational level, however, there have been challenges, particularly in recent months, around transitioning from the critical skills work permit after two years to the Stamp 4 permission to work. While the Department of Business, Enterprise and Innovation provides a letter for the individual after 21 months of employment, there can be problems receiving the immigration stamp in a timely fashion. Greater collaboration between the Department and the naturalisation and immigration services is needed to ensure that after investing in these highly skilled employees, we do not lose this talent due to unnecessarily bureaucratic procedures or disconnection between Government services.
Work needs to be done to ensure a cohesive interdepartmental approach to work permits and visas as delays in this area are becoming a significant issue, not only for day-to-day applications but also within the trusted partner initiative. My colleague, Ms Una Fitzpatrick, from Technology Ireland will be able to provide practical examples of the issues encountered by her member companies in this regard.
I thank the committee for this opportunity to introduce this subject. We look forward to answering the committee's questions.
Mary Butler (Waterford, Fianna Fail)
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I thank Mr. Donohoe. I will open the forum to questions and I myself might kick off.
Deputy Kelleher brought a motion on apprenticeships through the Dáil last week. It is timely that we had that motion last week and that we are here discussing the matter today.
For the first six months of this year, the committee put a great deal of effort into addressing the cost of doing business. We had all the stakeholders in from across all the different sectors. It was interesting to hear from the tourism and hospitality sector, agriculture and construction, all of which bemoaned the lack of apprenticeships coming through. The tourism and hospitality sectors spoke about the dismantling of CERT in 2013, stating that there has not been any single organisation with sole responsibility for hospitality and tourism since then and that the lack of this training policy has left a significant void in that sector.
We heard a great deal about those who would have worked in the construction sector who when they get to their mid-50s find it difficult to continue along on those lines because it is a physical job. I am sure Deputy Kelleher will touch on this later. I ask Mr. Donohoe to comment on those two issues first.
I was shocked last week when I heard that women represent only 2% of all those doing apprenticeships in this country at present while 54% of those who took up apprenticeships in the UK between 2016 and 2017 were women. Mr. Donohoe might address why IBEC believes there are so few women entering into apprenticeships and what we can do to improve those statistics.
Mr. Tony Donohoe:
I will make an initial response but ask my colleague from the medical devices sector and the polymer sector, where they have practical experience of new apprenticeships, to address the matter and maybe introduce some other issues that we have. The Chairman raises a particular concern over the hospitality sector but many of the issues in developing the apprenticeship model are peculiar to all apprenticeships. I will take hospitality first.
I look forward to coming back to the committee at the end of the month with another hat on. I chair the expert group on future skills needs, and we have been looking at hospitality. We have heard much of what the committee has heard in terms of the shortages in that sector.
It is not the first time we have heard the closure of CERT being bemoaned by the sector. I think it lacked a lead Department to take ownership of it. The expert group has done analysis of the hospitality sector and there are new implementation structures in place. I hope they will be able to address that issue. On female apprentices, that reflects the structure of the industries in which apprenticeships have traditionally existed. Some 80% of apprenticeships were in the construction sector and, because of the nature of those trades, they tended to be male dominated. In fact, there has been a change since the introduction of new apprenticeships. For example, in the insurance apprenticeship we have 100 females so we have probably more female apprentices on that one programme than in the entire history of apprenticeship in the State. As we see the expansion of the model into other sectors, we will see that gender balance issue addressed. Maybe Ms Keogh would like to talk about her own experience.
Dr. Sinéad Keogh:
I will introduce myself first, talk a little bit about our programme and then address some of the questions. I represent the medtech and engineering sectors within IBEC. That includes medical technologies, polymer technologies and engineered manufacturing goods. This cohort represents about 80,000 people in Ireland. What is unique about those companies is that there is a significantly large proportion of SMEs. In 2017, after working for three years, we finally launched three apprenticeship programmes - manufacturing technician at level 6, manufacturing engineer at level 7 and polymer technology at level 7. We are delighted to say that we recruited 106 apprentices in year one across 58 companies, of whom 2% were women. This year we have gone to 170 apprentices with 10% female in the second cohort. We are working very closely on this and are trying to promote more women in our apprenticeship programmes. It is a priority for our boards to encourage more women into the apprenticeship programmes. We acknowledge the point and it is something we are working towards.
Our apprenticeships are run in conjunction with five institutes of technology partners in Limerick, Cork, Athlone, Sligo and Galway. That is a reflection of the industries we are serving, which are highly regionalised. In terms of recruitment, currently 70% of the 170 are within the industry. They are recruited within the sector so are already working within the companies, while 30% are new hires. We expect that to change over the years ahead. We expect more new hires as the industry becomes upskilled. We have been among the first out of the blocks in terms of new apprenticeships. It is important to remember that it is an occupational profile. The apprenticeship we are operating is open to all manufacturing sectors. Of the types of company that have engaged, 48% are in medical technologies and 52% are in engineering. It is quite broad and the occupational profile is a building block for engineering in general. We are out there promoting it far and wide. This year, we have recruited in food, ICT, aviation, automotive - we are recruiting in lots of different manufacturing sectors.
One of the challenges of expanding the apprenticeships is the cost of getting involved. For an SME or company to engage in the apprenticeship, the cost of a three year programme for a new hire is about €90,000. Our apprenticeship includes 15 weeks off-site and we spent two years developing that model. As it is a hands-on, technical training type of apprenticeship, the requirement to be off-site and within the institute of technology is very important to gain those skills. It is quite different from other apprenticeships because there is that focus on practical skills. This creates a major challenge for a lot of SMEs in terms of cost and this is one of the major barriers to us in terms of growing the apprenticeships. It is an issue we would like to bring to the committee's attention. We have a couple of other issues but that would probably be the main one at this point.
Billy Kelleher (Cork North Central, Fianna Fail)
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By and large, apprenticeships have historically been in the construction sector and, through CERT, in the hospitality sector. There is now an evolution taking place in the broader labour market in terms of provision of apprenticeships. Why did it take so long for us to accept the need for industry to get involved in educating its own workforce? That is essentially what apprenticeship is about. It is about developing skill sets allowing employees to progress through a sector. Dr. Keogh made reference to the cost involved. If it is prohibitive or at least expensive to take on an apprentice or develop an apprenticeship course, what can we do to offset that? Would tax reliefs or something else incentivise people? Did Dr. Keogh say there were 80,000 employees in her sector?
Billy Kelleher (Cork North Central, Fianna Fail)
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The number of apprentices currently in place is not huge in proportion to the number of people working in the industry. Clearly there is a lot to be done but it is a step. I am not making a criticism. These are just observations. We are all trying to work our way around to seeing how we can best advance apprenticeships. What incentives are required? I have always believed the public sector should play a greater role in providing apprenticeships. The financial and banking sectors as well as multinationals would also have the capacity and the incentive to deliver apprenticeship courses for upskilling their employees. I do not hold with the idea that we can allow somebody else to train the people, that we can employ them, let them go when there is a downturn and, if there is a skill shortage, bring them in from abroad. Certainly that is not a long-term sustainable way of managing a labour market or an economy that is constantly evolving.
The Chair referred to another aspect of this. Some apprenticeships in trades can evolve and move into other areas. However, in certain areas and particularly in the construction industry and hospitality - areas that traditionally have offered lower pay - it is hard to move beyond the traditional apprenticeship role. A block layer is a block layer until the arthritis sets in and he can no longer lay blocks. It is often the same for people in the hospitality sector below lower management level, in the basic skill set areas. They do not move that well through the system. What can we do to make clear pathways into apprenticeship and clear pathways for career progression? Is it possible to use the apprenticeship as the anchor but to branch off from it into formal education, training, third level degrees or something else?
Dr. Sinéad Keogh:
I will respond to the first question about what we can do in terms of incentivising. Perhaps somebody else would like to answer the other questions. We would like to see more SMEs engage in the current apprenticeship. It has been developed for all of the economy. We want to make sure they have the opportunity to engage. If we are looking at a salary of €24,000, the cost for 15 weeks is roughly €7,500.
We are looking for an incentive of €7,500 for SMEs to take on an apprentice. This is not including all the costs of training that apprentice.
Billy Kelleher (Cork North Central, Fianna Fail)
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Is this effectively to fund the old traditional block release?
Dr. Sinéad Keogh:
Yes, essentially. That is at a very high level in terms of what our companies have said would make a difference in being able to take on apprenticeships. For us, they are successful if we can engage both the SME and the FDI communities. That is really important to us because we represent both.
Mr. Tony Donohoe:
The pinch point here is the payment for off-the-job training because under craft apprenticeships the off-the-job training costs are handled by the State, which is the big difference. That has been a pinch point, particularly for SMEs. Deputy Kelleher made two other points I would like to pick up on. He used the example of a block-layer. I think there has been acknowledgement within the traditional craft apprenticeships that they did not focus enough on what we call the transversal skills, that is, the employability skills, the softer skills. Therefore, there were very few opportunities to move out of such apprenticeships. It should be a broader education experience. I was taken by Deputy Kelleher's use of the word "anchor" and his point that the apprenticeship is the anchor. I agree 100%, and what characterises the new apprenticeships are the progression opportunities. I will bring in my two colleagues here because we have examples of being able to provide a pathway into apprenticeships and then, particularly in the high-tech sector, progression opportunities through to higher degree level. Not everyone might want to go that far, but that progression opportunity should at least be available. The reason this is so critical is that if one is competing, as I said in my opening remarks, with the CAO system, those progression opportunities need to be available within the apprenticeship model. That is the power of the model. As I said, with the Chairman's permission, I will introduce an example first of progression into apprenticeship and then of progression to the higher levels.
Ms Claire McGee:
I will answer Deputy Kelleher first. I thank him for his question. I will very briefly touch on pre-apprenticeship programmes because the time for them is now while we have a very tight labour market and are looking at how we can provide more and more people with the opportunity to participate in an education programme. Pre-apprenticeship programmes are generally targeted at young people between the ages of 16 and 24. The aim is for them to progress fully to an apprenticeship. Pre-apprenticeships are aimed at giving young people the necessary skills, confidence and connections. The latter is incredibly important because in the craft or more traditional apprenticeships people might not have had that social network or the capital to ask an uncle or a neighbour to participate and be trained by them as a master apprentice. Pre-apprenticeships aim to give them that opportunity and that network to do so. They provide a combination of vocational training, hands-on experience and an opportunity to sample some skills across a broad spectrum of training programmes. Generally, they are targeted at young people who may not have been very successful until that point in making a positive or sustained transition into more vocational training. This is a tailored programme to offer them that. I was very heartened to see some of the recommendations in the recently published SOLAS review of Pathway to Apprenticeships. This aims to increase pre-apprenticeship programmes around the country by about 500 by the third quarter of 2019. However, this ambition will not be realised without adequate resources to enable such transition and changeover.
I will introduce the committee to a pilot programme under way with DIT. It is one of the first such programmes in Ireland and has not really received significant State funding to date. It has been supported by the JPMorgan Chase Foundation, a philanthropic fund, and philanthropic funding through the ESB. In 2017 DIT launched a pilot programme aimed at supporting the transition of young people, particularly from areas of socio-economic disadvantage in Dublin's inner city centre, to secure apprenticeships. DIT has its roots in vocational education. Traditionally, it supplied about 25% of the traditional apprenticeships. This pilot programme was about addressing young people's lack of knowledge in these areas to secure apprenticeships as well as those low levels of social capital that I mentioned and generally targeting areas within inner city Dublin. It was rolled out over 18 months, during which period 48 students were recruited on three separate 12 week programmes. The 12 week programmes focused on offering various different skills and opportunities to learn about different types of apprenticeships and ultimately to build links with employers in order that they could see the output of these programmes. This is known as worked access to an apprenticeship. It worked in partnership with employers to provide a two week work placement at the end of the 12 week programme. Over 50% of the apprenticeships managed to fulfil that workplace programme. The two week placement took place at the end and gave these young people a really good insight into a workplace environment and experience of what the reality of an apprenticeship would be like. It gave them an opportunity to determine whether this would be a pathway for them. DIT reached into its network of apprenticeship employers and developed a multifaceted work experience approach whereby apprentices had an opportunity to work with Sisk, with one of the aviation technology companies or with the ESB. The programme was also supported by an advisory board and had input from key representative groups, including IBEC; the HEA; the Technological Higher Education Association, THEA; the Dublin Regional Skills Forum; the Construction Industry Federation, CIF; and the National Youth Council of Ireland. Everyone gave their different perspectives from their experiences of young people, education provision and employment. After the initial pilot programme, out of the 48 young people, 26 moved into full-time apprenticeships.
This pilot scheme has, therefore, demonstrated in an 18 month period the power of a pre-apprenticeship programme and the transformational effect it can have. DIT is now working on a second-stage pilot programme, again funded by JPMorgan, and this time has managed to secure some State funding via the HEA. It is hoped this will aim to develop the programme and work on a couple of tweaks to refine it built on how it evolved over phase one. It will run from October 2018 to March 2021. How can we support this to bed into our system? Given the fact this programme was seen as a level 6 special purpose award, it was not fully recognised by the Department of Employment Affairs and Social Protection as a qualifying programme for trainee allowances. This could potentially be a red-line issue in the future because the participants were not able to maintain social welfare payments. As a result, they forwent them for the 12 week programme and risked losing their payments upon taking up a course. This will be a fundamental stumbling block to rolling this out and achieving the number of 500 by the third quarter.
Mary Butler (Waterford, Fianna Fail)
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May I interject? Is it just level 6 that they could not-----
Ms Claire McGee:
Yes. This is not recognised as a training programme because it is not on the national qualifications framework and is a special purpose award. If we could perhaps do a little work on getting that recognition for it, it would fulfil the Department of Employment Affairs and Social Protection's requirements in respect of being able to manage a back to work allowance or retain or receive a social welfare payment. This is critical if we think about the cohort who will be involved. This is also very much focused on a pilot scheme within Dublin city centre, within DIT, and again, what we now need to see for it to be successful is a mainstreaming across the system. A programme such as this could easily work in Limerick, Cork or Galway, where there are equal socio-economic issues that need to be addressed and particular challenges or certain regional employers who need specific skills. How can we look at rolling this out on a more national basis and get more education and training providers to get involved?
Picking up on the point about female participation, there were two ladies who participated in this programme. They happen to be sisters. One has not managed to progress to a full-time apprenticeship. One was 20 and the other was 16, so the latter was just slightly too young to take on the full programme. Nonetheless, they are being used front and centre of the programme's campaign to showcase that this is a very good avenue for females to consider if they want to consider apprenticeships in the future.
Mary Butler (Waterford, Fianna Fail)
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Would Ms McGee mind sharing with us what types of apprenticeships they went on to?
Ms Claire McGee:
I can do so after this meeting, if that is okay. For various reasons I do not have full information on where exactly they went and which companies they went into, but it was across different types of the more traditional apprenticeships. I do not know where that one female went but I will follow up on the matter with the Chairman and can come back to her on it.
I would like a greater emphasis on how employers can actually get involved in the pre-apprenticeship programme to provide that two-week work placement and how it can be managed in order that employers also receives some benefit from it, in that they can give a structure work experience programme with a particular project that they could get the young pre-apprentices to work on.
Focusing on the cohort, we should examine if more of the transversal skills can be included, that is, those employability skills that will help apprentices both with their own emotional and behavioural intelligence and will help them to retain on the course and improve their own personal outcomes. Consequently, it is about supporting the apprentices while they stick with the programme.
We should also make sure that we have a greater focus on how this is part of that suite of apprenticeships and we seek appropriate pathways into the new apprenticeship programme. This is a pilot scheme very much focused on DIT's experience within the more traditional, construction-based apprenticeships but we should think about how this will roll out into the newer spaces and the new generation of apprenticeships about which we have just spoken.
Pádraig Mac Lochlainn (Sinn Fein)
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I thank the witnesses for their presentations. Mr. Donohoe, in his presentation, referenced the governance review of the apprenticeship training in Ireland and expressed frustration on behalf of some at the speed at which it happened. He referenced comparisons with other countries and how that is not particularly pertinent because of the cultural changes that need to happen here, but he and others were frustrated at the speed. At whom is he frustrated? Where are the blockages and problems?
Mr. Tony Donohoe:
I will call on my colleagues to give the committee some of the practical insights but I will first comment on the point about other countries. The German system was developed over centuries and is embedded in the way employers do their business, as well as the involvement of trade unions and the learners in social partnership arrangements. To answer the Deputy's question directly, I think it is because there are so many-----
Mary Butler (Waterford, Fianna Fail)
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I will interject again. There is interference again on the microphones and that is the third time I have been told that, so I am really sorry, but if mobile phones could be put on the floor. I do not know why it is so sensitive today.
Billy Kelleher (Cork North Central, Fianna Fail)
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Mine is on aeroplane mode.
Pádraig Mac Lochlainn (Sinn Fein)
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Aeroplane mode here too.
Mary Butler (Waterford, Fianna Fail)
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I am only passing on the message but I can hear the interference myself. For anybody who wants to watch, they cannot.
Pádraig Mac Lochlainn (Sinn Fein)
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There are gremlins.
Mary Butler (Waterford, Fianna Fail)
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Please continue, Mr. Donohoe.
Mr. Tony Donohoe:
I think it is the number of actors. First of all, it was a step change, in that it was a different way of approaching this. I think the model is still right, the model of enterprise-led apprenticeships is the right one, but the number of actors involved includes SOLAS, the Higher Education Authority, the Department of Education and Skills and Qualifications and Quality Ireland. There are four arms of the State, although that is not to criticise the State. There are also multiple companies. It has been relatively straightforward with the IBEC ones because they have been single sector or groups. There is only one prime group for the medtech and engineering sector, or Technology Ireland, or pharmachem. In other sectors, there are multiple groups that are trying to come together. There are a lot of actors there and by definition, that slowed it down.
The apprenticeship plan is a 12-stage process. We are using 40 year old legislation here. Much of the legislation is still fit for purpose in respect of protection of apprenticeship and employing somebody on a contract of apprenticeship. We would not change a word of that, we think it is fine in terms of the rights and responsibilities of both employers and apprentices. In terms of approval of companies and designations of sectors, the legislation is probably out of date and we need to streamline that process. The apprenticeship plan is presented as a circle of 12 steps, but it is actually more like "Snakes and Ladders" in the sense that if one gets to a point, one can go back. If one does not get approval, for example, under Qualifications and Quality Ireland, one has to go back to the drawing board.
I have no issue about the involvement of the quality assurance agencies because if this is to mean anything, it needs to be something of which employers and learners are confident in the quality but the processes are probably still a bit bureaucratic. I think it is getting better, however.
I would like to introduce Ms Siobhán Dean because she launched some apprenticeships that were announced by the Minister last week. She has got through the process a bit quicker than some of the others who were early adopters, so we are probably getting better at that. To summarise, there is a multiplicity of actors and we are using old legislation. It is really difficult to change legislation because that would take quite a while. Ms Dean might give a practical example.
Ms Siobhán Dean:
Biopharmachem Ireland has been quite lucky in where we came in the process because we were able to learn from our colleagues within the medtech sector in IBEC. We launched our programme just last week comprising the higher certificate in science, that is, a level six lab technician, and the ordinary bachelor of science degree, that is, a level seven analytical scientist. It is unique to our sector. Of the scientists in our sector, 100% of the staff have a third level qualification, so it is unique to our industry.
It is a key point that it was industry led. The need came from the report of the expert group on future skills needs of 2016. We say we came fast to the market, but it still took two years by the time we got industry together, looked at our needs, went for approval, got funding and then the whole process of going on to those 12 steps, to get the programme launched. We were very successful in turning that around within nine months, once we got approval, but it is a balancing act of trying to get up through the snakes and ladders, as Mr. Donohoe mentioned. Quality is of the utmost importance, as is the ability to progress on to levels eight and nine within the sector.
The other key thing which made this very successful is that it is not developed only for the biopharma industry. It will hopefully also span out into the food sector and the diagnostic side of the medtech sector as well.
I would also like to highlight the representation of women within our programme. The programme that we launched is very new. Our first class was started in October and we are looking to increase those numbers from a first class of 16. We are looking to bring those numbers up to 100 by this time next year. Of those involved in this programme, 64% were women, so I think we will support that.
Progression is very important for the sector, and the ability of those people to progress into further programmes after they come off the apprenticeship.
Pádraig Mac Lochlainn (Sinn Fein)
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I appreciate the witnesses were asked to give a ten-minute presentation so a lot of points had to be summarised but it would be helpful to develop this issue of the speed at which change is happening. It would be helpful for the committee if the witnesses were to follow up with a detailed submission on the legislative change that is required on the blockages they are encountering in the system. That would be very helpful for us, as legislators, to try to make some practical changes.
Towards the end of Mr. Donohoe's presentation, he brought attention to this issue of greater collaboration between the Department and the Garda National Immigration Bureau, GNIB, and the Irish Naturalisation and Immigration Service, INIS. Has he made representation to the Departments on this issue and what has been their response?
Mr. Tony Donohoe:
With the Senator's permission, I will bring in Ms Fitzpatrick on this because she has had a lot of interaction with the Department on the whole issue of work permits because it is a particular issue for the technology sector. As I pointed out in the introduction, most companies are in the tech sector and are competing on a worldwide stage for talent.
Ms Una Fitzpatrick:
I thank Senator Mac Lochlainn for the question. Until six months ago, the system was still somewhat bureaucratic but working well. Technology companies which are trusted partners, be that an Enterprise Ireland or an IDA Ireland member client, were assured they would have an answer to a work permit application within two weeks. At that point, they can go on to obtain a visa. That process takes nine weeks, therefore, the best case scenario is ten to 11 weeks. That was not great but we could live with it. Business likes certainty and if there is certainty around those sort of dates, it can work to those.
In recent months, however, the feedback from companies has been that even the processing time for trusted partners has slipped to eight to 12 weeks. There was an update on the Department of Business, Enterprise and Innovation website regarding processing times, apologising for the delays, advising that it had received a high number of applications and that the current waiting times were five weeks for trusted partners and 14 weeks for standard applications. The feedback from our member companies is that the waiting times are significantly higher. In terms of the consequences of those delays, job offers are falling through and significant costs are being incurred by both multinational companies and indigenous software technology companies. Companies are using many third parties companies to process applications, thereby increasing costs.
The feedback on this to their corporate headquarters is particularly negative in that they are asking the reason that is not happening at the moment. We have been in touch with the Department through the Tech/Life Ireland review, which is a process that looks at attracting people into Ireland, specifically for the technology sector. The feedback was that something happened within the Department - we never got to the bottom of what it was - but that it was working to resolve it.
The fact that this has occurred in the past six months has led to a number of concerns on the part of companies. They first wanted it amended but asked if this will happen again. Ultimately, that begins a debate on the question, why Ireland? It has led to many questions being pushed back. A company in Cork could not hire one key figure, which led to 200 jobs being moved to Prague. Those are the impactful case studies. I make the point that it might seem like one hire or one application but it has massive ramifications in terms of industry because that person could be leading an entire team, and that team will go with that person.
Our request is that there would be an immediate fix to the current problem. In addition, having both the Departments of Business, Enterprise and Innovation and Justice and Equality dealing with work permits and visas seems to be a highly bureaucratic system. The recommendation from members is that the EU blue card system and other systems throughout Europe are far more efficient and attractive for companies. On a competitive basis alone, therefore, it would be worth investigating.
Pádraig Mac Lochlainn (Sinn Fein)
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That was a very helpful but alarming contribution from Ms Fitzpatrick, particularly in terms of the lost jobs and opportunities. She might make a supplementary submission to the committee on the specific problems IBEC has had and, with the agreement of the Chairman, we could then make representations to the Departments on this specific issue. I do not believe that addressing it can wait for us to conclude our deliberations and recommendations. If that is in order, I would make that suggestion.
Mary Butler (Waterford, Fianna Fail)
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I thank Senator Mac Lochlainn. I ask Ms Fitzpatrick if the problem is specific to non-EEA workers?
Mary Butler (Waterford, Fianna Fail)
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Ms Fitzpatrick said she only noticed this issue within the past six months. Until then, it was okay.
Mary Butler (Waterford, Fianna Fail)
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Representatives from the Department will be before the committee on 27 November so we will raise the issue with them.
Pádraig Mac Lochlainn (Sinn Fein)
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The witnesses better be quick.
Mary Butler (Waterford, Fianna Fail)
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They might get that note to us very quickly.
Kevin Humphreys (Labour)
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On the same issue, have the witnesses noticed whether that problem is country-specific or is it everyone outside the 27 member states?
Kevin Humphreys (Labour)
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I have noticed it in respect of the US.
Kevin Humphreys (Labour)
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I had five queries in the past four weeks to do with specific team leaders for US companies. I was curious to know if it was a problem with US companies only because all the queries to me were US-related.
Ms Una Fitzpatrick:
A recent change, and we are not entirely sure where it came from because there was no consultation on it, was around re-entry visas. That is where people send in their passport for a 90-day re-entry visa. One used to be able to go in person and sort it out. It now has to be posted in.
Kevin Humphreys (Labour)
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Is that where the appointments have caused a problem?
Mary Butler (Waterford, Fianna Fail)
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When all the paper work is in order, it is taking eight weeks to turn around the application.
Kevin Humphreys (Labour)
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Without their passport.
Kevin Humphreys (Labour)
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So they cannot go back to the US.
Mary Butler (Waterford, Fianna Fail)
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That is ridiculous.
Mary Butler (Waterford, Fianna Fail)
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Does Ms Fitzpatrick believe it has anything to do with Brexit and the fact that they are getting pedantic now in terms of different-----
Ms Una Fitzpatrick:
I do not know. To be honest, we did not know if there was a change of policy. The concern was whether this was just a processing issue and personnel issues within the Department or if there had been a policy shift in terms of the granting of work permits and visas. The feedback was to ask if it was due to the housing crisis because if people are hired, where will they live? Sometimes that was the question being proposed.
Mary Butler (Waterford, Fianna Fail)
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Have they put extra checks and balances-----
Mary Butler (Waterford, Fianna Fail)
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-----and layers in place on the off-chance that there would be a hard Brexit and they are getting their ducks in a row? I do not know.
Kevin Humphreys (Labour)
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I had a particular geographical issue. What is being said to me is that they are not making the application now because they want to go home for Christmas and there is no guarantee they will get their passport back in eight weeks. They may have a commitment to go back to New York, San Francisco or wherever. They will not surrender their passport for eight weeks but when they return and apply, it will be out of date.
Billy Kelleher (Cork North Central, Fianna Fail)
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With reference to Brexit, work permits, mutual recognition etc., a template for an agreement is being discussed between the European Union and the UK and in that context, Ireland will be in a unique position. As we will still be members of the common travel area with the UK, our citizens will have access to the UK labour market and, equally, the UK labour market will have access to Irish citizens in the Republic. Irish citizens will have access to the European Union labour market and the European Union will have access to the Republic of Ireland labour market. In all of that, the country most likely to be affected in terms of a draw of labour is the Republic of Ireland in the sense that if there was very strong growth in the UK, many Irish people potentially could move to the UK because European labour would no longer have access to the UK whereas the Republic of Ireland would within the common travel area. The opposite is the case also because if the European Union weakens and the Republic of Ireland has a strong economy, there could be a movement of people either from the UK or Europe or both because we will be in the unique position of having access to both labour markets. With that in mind, has the issue of the continued convergence of mutual recognition between the UK and Ireland post Brexit, regardless of whether there is a soft, medium or hard Brexit, been examined? It would be important that in terms of apprenticeships and courses of all forms, there would be continual mutual recognition with the UK. That would have profound implications in the context of Northern Ireland and the Border counties.
Has anyone looked at that? I acknowledge the difficulty of looking into something opaque but by the time it becomes crystal clear, it could be too late for us if we do not have the detail and certainty around mutual recognition. I say that because the EU will negotiate with the UK but that could be on the larger issues. Mutual recognition between Ireland and the UK is an issue of significance, in particular if we are developing apprenticeship courses outside the traditional ones that have been recognised.
Mr. Tony Donohoe:
There is good alignment currently. Ireland was one of the first countries to have a national framework for qualifications and the one we have is robust and well recognised. It is aligned with the UK framework and there is a read across on the different levels. The UK calls a level 6 a level 5 as it has a smaller number of levels. We have ten levels whereas the UK has eight. However, there has been a great deal of work on alignment, a lot of which was done, ironically enough, during the last boom. A lot of labour was coming in at the time and the then-qualifications agency did significant work on that. Its website eventually became that of Quality and Qualifications Ireland, QQI. A lot of work has been done to read across different types of framework. However, the Deputy's general point is interesting. One of the first responses to Brexit came from higher education. Many of the universities started to get inquiries from British-based academics and it was not just Irish people working in UK institutions. Something like Brexit goes against the core of academics and there is nothing more international than higher education. As such, there were many unprompted inquiries to education institutions here. It could work both ways but we see it as an opportunity as well, not just in higher education but in financial services and so on.
Billy Kelleher (Cork North Central, Fianna Fail)
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Are convergence and mutual recognition done primarily on a bilateral basis between the Republic of Ireland and the UK or is there an obligation on foot of the overarching EU influence that has been there?
Mr. Tony Donohoe:
It is both. There is something called the Bologna process, which looks at aligning frameworks but we were very far ahead of the curve on this, as was Scotland. England and Scotland are slightly different on this. It is happening at EU level but it had been happening on a bilateral level anyway. City and Guilds is very active in the Republic, for example, and many professional bodies, including accountancy and engineering bodies, deal with qualifications which are aligned across international professions. Without being complacent about it, I am relatively optimistic that we have our ducks in a row.
Mary Butler (Waterford, Fianna Fail)
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I thank the witnesses for attending. I thank them for their individual stories as it far more informative to get real-life examples.