Select Committee on Education and Employment Appendices to the Minutes of Evidence


Memorandum from Business Services Association


  1.  The Business Services Association represents major companies providing outsourced services to companies, public bodies, local authorities and government departments and agencies. The combined turnover in the United Kingdom of its 16 member companies is around £10 billion. Member companies employ directly and indirectly in excess of 350,000 people, many of them at blue-collar level.

  2.  BSA members are committed to delivering high-quality services to their customers. They are also firmly committed to training and advancing their employees, and have sought to work with Government since the beginning of the New Deal initiative to promote these ideals.

  3.  BSA publicly endorsed the New Deal in August 1997, and submitted a paper to the Select Committee in October 1997 expressing its initial thoughts on how the scheme might be given the best chance of success. Further evidence was submitted to the Committee in March 1999, outlining some thoughts on ways in which employers might be more effectively involved in the early stages of the New Deal process alongside the ES, and in November 1999, concerning geographic and economic factors influencing the "jobs gap".


  4.  Previous evidence from the BSA to the Select Committee has highlighted the problems of matching supply and demand in some areas, such as Gatwick Airport, Aldershot and the East Midlands. The experience of BSA member companies here and elsewhere indicates clearly that there is a genuine problem in matching supply and demand at local level, and that geographic considerations play a significant part in this. Unless ways can be found to alleviate the economic and social pressures which restrict the mobility of the labour force, this is unlikely to improve.

  5.  Aside from the geographical issues already considered, two main areas need to be addressed if employers are to be able to assist job-seekers into long-term employment:

    (i)  the job-readiness of candidates;

    (ii)  the ability of the ES to place candidates speedily.

  6.  Whilst it is undoubtedly true that many employers will prefer to recruit their staff from those currently or recently in employment, the primary need is for people who are both available and capable of doing the job. As employers we look for prospective employees who, even if they do not posses the specialist skills required, are willing and able to learn.


  7.  The latest developments of the New Deal programme, notably the improvements in the "gateway" stage, have gone some way to address the problems employers had previously experienced with the New Deal. We welcome the announcement of the "Intensive Gateway" as a period in which job-seeking skills can be developed, and the move away from more generalised academic and other training courses. Those who have been unemployed for some time are likely to benefit from focused preparation in interview techniques and the disciplines of work—the so-called "soft skills" which are essential in building a successful long-term career.

  8.  We believe that these aims can be achieved most effectively in an intensive gateway period of two to three weeks, after which specific skills training can be undertaken within the workplace. BSA member companies, like many others, already have well-established training schemes for their employees, and these have proved to be an efficient and cost-effective way of addressing skills shortages in the workforce.

  9.  It is natural that many employers would prefer to take on staff who have already demonstrated their ability to hold down a job, but most are also keen to overcome barriers against the previously unemployed. In particular, we would commend the schemes such as that involving the ES and Nissan, in which New Deal candidates undergo Gateway training within the company, as an effective way of breaking down prejudices on both sides.

  10.  As an Association, we have advocated just such a scheme within our industry sector, which employs large numbers of staff at blue-collar level, and have worked with the ES for some time in an attempt to establish this. However, we have experienced considerable levels of frustration in this attempt, due in part to the staff turnover levels within the ES itself, which have prevented the necessary ongoing relationships from developing between ES and employers.

  11.  There is also a need for a more consistent awareness among ES and JobCentre staff as a whole of the potential for business to become involved in the process of placing candidates in suitable jobs. Employers have much expertise to contribute, and their participation needs to be actively encouraged. There is potential here for the establishment of Public Private Partnership arrangements, to the benefit of all sides.


  12.  BSA member companies report some concern that the process of taking on staff under the New Deal is simply too cumbersome to be cost-effective. The need is for staff who can be available as soon as a vacancy appears, since companies cannot afford to leave jobs unfilled when there are contracts to be fulfilled.

  13.  This problem would be eased by the proposed introduction of a shorter gateway period (see paragraph eight) and an early entry into work, allowing a more rapid movement of New Deal candidates through the placement process. There is also a need for improved systems to identify and place the correct candidates to fill the vacancies available.

  14.  Experience suggest that private recruitment agencies, many of which focus specifically on one industry or sector, are better able than the JobCentres to meet this need effectively. Indeed, a number of BSA member companies operate their own agencies to place staff within their various subsidiaries. The business services sector is highly labour-intensive, and the demand for staff is likely to be both immediate and varied.

  15.  As specialists within their market sectors, employment agencies are experienced in matching candidates with vacancies, and are generally able to act more speedily than the more bureaucratic systems of the ES will allow. We welcome the development of closer links between the two and believe that the private sector has much to contribute in terms of developing more effective processes and systems.


  16.  Much has been achieved to date through the New Deal, but there are still many problems to be addressed. Key areas remain:

    (i)  the problems posed by the mismatch between vacancies and job-seekers;

    (ii)  a continuing lack of consistency of approach within the ES;

    (iii)  insufficient involvement of business.

  17.  The BSA is and remains committed to the concept of the New Deal, but time is running out and speedy action is needed. We want it to succeed and are willing, as an association and as individual employers, to work alongside the ES and Job Centres to help it to do so. We want to help those genuinely seeking employment and a career to fulfil their ambitions.

Business Services Association

March 2000

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2001
Prepared 7 February 2001