Privatisation 'fiasco' threatens skill centres

THE COLLAPSE of the Astra training company - which Labour has dubbed 'the biggest fiasco in the history of privatisation' - will mean the loss of as many as 30,000 places for the unskilled and the unemployed, union leaders have been told.

Astra, formerly the Department of Employment's Skills Training Agency, was given to ex- civil servants in 1990. The department handed over pounds 11m - to cover initial losses - and 45 skill centres, complete with equipment, valued at pounds 63m.

On 22 July the company, which trained 60,000 people in the last financial year, went into receivership. The receivers, Arthur Andersen, and the employment department both maintained publicly last week that most of the 35 skills centres which the company still owned - 10 have been closed to save money - were likely to be bought by other firms, leaving undamaged Britain's ability to produce a skilled workforce.

In private, officials from the National Union of Civil and Public Servants, which represents staff, were told by Arthur Andersen on Friday that the biggest vocational training company in the country was likely to be destroyed.

The receivers expected between a third and a half of the remaining training centres to close, according to the union's spokesman, Ian Taylor. The Deptford centre closed last week and tools were auctioned at Milton Keynes. Trainers at Enfield, Crawley, and Nottingham expected to hear this week that their centres would also be going.

Frank Dobson, Labour's employment spokesmen, said: 'My information is that only 10 of the 35 centres will survive. This was once an organisation that provided desperately needed, high-quality training and should have been kept as a public service. For ministers to stand back and watch now when we need skilled workers to get us out of recession is scandalous.'

Astra was given to Stuart Bishell, Trevor Kent and Philip Wills, who had managed the centres as civil servants. Company House records show that a string of subsidiaries was set up. They also reveal that the directors' earnings rose rapidly from the salaries of about pounds 35,000 they received in the public sector. In 1991, the last year for which returns have been filed, the highest- paid director had a salary of between pounds 55,000 and pounds 60,000 and the other two pounds 50,000 to pounds 55,000.

The company ran into trouble almost as soon as it was privatised. Firms reduced training as the recession bit and what Astra called 'short-term' government policy undermined profitability. Astra told the Commons Employment Committee in February 1992 that state funding for training had been cut.

Meanwhile, the Department of Employment's 102 Training and Enterprise Councils - the quangos staffed by business people which control pounds 2bn of public money to provide training - were giving Astra wildly varying contracts, which made co-ordination impossible.

John O'Brien, 35, taught hundreds of young men carpentry in Astra skills centres for seven years. 'When we were in the public sector we were really proud of our achievement,' he said. 'After privatisation that all changed. First we didn't have a stick of wood to work and had to rummage around in bins for scraps. Then we were told we should not train people too well or they would not come back for more.'

Mr O'Brien was sacked earlier this month. 'I've had a bellyful,' he said. 'A service which the country needs was just pissed around from pillar to post.'

Mr Dobson has called for a public inquiry into the financial structure of the firm. He alleged last week that the property side of the company was 'milking' the trainers. In one case 'rent of pounds 75,000 is paid to the freeholder (of a skills centre) while rent of pounds 150,000 is charged to the trainers (in the same centre)'.

But a spokesman for Arthur Andersen said it had found nothing wrong with this practice. The receivers had a duty to report any financial movements which could be criminal and 'had made no such report'.

Documents released by Labour last week, however, have provoked a Department of Employment inquiry. Astra was taking advantage of Government bounty payments to skill centres of pounds 600 to pounds 1,000 for every ex- trainee who found work within three months, Labour said. It alleged the company claimed the money even for trainees in temporary jobs.

(Photograph omitted)

Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Account Manager / Media Sales - OTE up to £30,000

£20000 - £30000 per annum: Recruitment Genius: This award-winning company, whi...

Recruitment Genius: Senior Software Developer

£40000 - £50000 per annum: Recruitment Genius: This is a unique & exciting opp...

Recruitment Genius: UX Consultant

£35000 - £45000 per annum: Recruitment Genius: You will be working with a 8 st...

Recruitment Genius: Part-time Editor

£8000 - £12000 per annum: Recruitment Genius: A unique opportunity has arisen ...

Day In a Page

Orthorexia nervosa: How becoming obsessed with healthy eating can lead to malnutrition

Orthorexia nervosa

How becoming obsessed with healthy eating can lead to malnutrition
Lady Chatterley is not obscene, says TV director

Lady Chatterley’s Lover

Director Jed Mercurio on why DH Lawrence's novel 'is not an obscene story'
Farmers in tropical forests are training ants to kill off bigger pests

Set a pest to catch a pest

Farmers in tropical forests are training ants to kill off bigger pests
Mexico: A culture that celebrates darkness as an essential part of life

The dark side of Mexico

A culture that celebrates darkness as an essential part of life
Being sexually assaulted was not your fault, Chrissie Hynde. Don't tell other victims it was theirs

Being sexually assaulted was not your fault, Chrissie Hynde

Please don't tell other victims it was theirs
A nap a day could save your life - and here's why

A nap a day could save your life

A midday nap is 'associated with reduced blood pressure'
If men are so obsessed by sex, why do they clam up when confronted with the grisly realities?

If men are so obsessed by sex...

...why do they clam up when confronted with the grisly realities?
The comedy titans of Avalon on their attempt to save BBC3

Jon Thoday and Richard Allen-Turner

The comedy titans of Avalon on their attempt to save BBC3
The bathing machine is back... but with a difference

Rolling in the deep

The bathing machine is back but with a difference
Part-privatised tests, new age limits, driverless cars: Tories plot motoring revolution

Conservatives plot a motoring revolution

Draft report reveals biggest reform to regulations since driving test introduced in 1935
The Silk Roads that trace civilisation: Long before the West rose to power, Asian pathways were connecting peoples and places

The Silk Roads that trace civilisation

Long before the West rose to power, Asian pathways were connecting peoples and places
House of Lords: Outcry as donors, fixers and MPs caught up in expenses scandal are ennobled

The honours that shame Britain

Outcry as donors, fixers and MPs caught up in expenses scandal are ennobled
When it comes to street harassment, we need to talk about race

'When it comes to street harassment, we need to talk about race'

Why are black men living the stereotypes and why are we letting them get away with it?
International Tap Festival: Forget Fred Astaire and Ginger Rogers - this dancing is improvised, spontaneous and rhythmic

International Tap Festival comes to the UK

Forget Fred Astaire and Ginger Rogers - this dancing is improvised, spontaneous and rhythmic
War with Isis: Is Turkey's buffer zone in Syria a matter of self-defence – or just anti-Kurd?

Turkey's buffer zone in Syria: self-defence – or just anti-Kurd?

Ankara accused of exacerbating racial division by allowing Turkmen minority to cross the border