Check against delivery:
It’s good to be back here in Pencoed at this remarkable centre of excellence in Digital Technology.
If we ever need a reminder of what Wales can offer in an age of technology-driven economic and social transformations, then it is right here at Sony in Pencoed.
Sony has been a key part of the economic landscape in South Wales for over 40 years now, surviving and thriving through numerous economic cycles, reinventing its business model, and staying at the cutting edge of hi-tech manufacturing.
This site is, of course, also home to the Raspberry Pi – the credit card sized computer that is creating something of a revolution in the way children learn computer programming skills and it’s manufactured right here in Pencoed.
And let me tell you about my daughter, who came home from school on the first day of term and told me she had joined the Raspberry Pi Club – when she asked me if I knew what a Raspberry Pi is, I was able to say yes. And not only that, I was able to tell her it is a product made in Bridgend and one that I am very proud of.
Though I learnt yesterday that there is now a new Raspberry Pi 2 – in response to huge global demand and soaring sales and which is creating 30 new jobs here in Pencoed.
What could be a more fitting place to reflect on the role of education and skills in driving Welsh economic success in the future?
Four weeks ago some of you heard me describe the scale of the economic challenge that is facing our nation of Wales.
In that speech, I spoke about the long term plan which the UK Government has been putting in place for the economy over the last five years and why I believe this plan is Wales’s best chance of moving off the bottom of the UK economic league table.
In that speech I spoke about the rebalancing of the economy which is at the heart of our economic plan…
…a rebalancing of our economy to create a stronger, more secure foundation for growth; the kind of growth that will generate and spread wealth more sustainably and more fairly across all parts of the UK – including here in Wales.
I spoke then about the reasons to be optimistic for Wales’s future, the fact that since 2010 we have seen 20,000 new manufacturing jobs created here in Wales, with more than 5,000 new jobs in the advanced manufacturing sector alone….
There is a rebalancing of the economy now underway, and it is beginning to bear real fruit for Wales.
But in that speech, I also spoke about some of the serious questions we need to address in Wales if we are to achieve this economic vision.
Today I would like to explore more deeply just one of those questions – and arguably the most serious one of all.
Because I believe there will be no greater determinant of Wales’s future economic success in the years ahead, than our ability to harness knowledge, to drive up our skill levels, and to create fertile ground for innovation in Wales.
And the success of our education system is fundamental to this.
There are those who caution against always crudely linking education to economic or workplace goals. And they are right of course. Education and learning are intrinsically valuable on their own terms. But here in Wales, I don’t believe we have had enough focus on the vital role of education when it comes to our economic performance.
Education is very often treated as a sub-set of wider debates about public services – and for some good reasons. But maybe we have not made the link strongly enough about just how important education is as a driver of long term economic success.
I don’t believe it is any accident that Finland and Singapore, the two countries judged to have the best education systems in the world, are also ranked as the second and third most competitive global economies by the World Economic Forum.
And it isn’t a coincidence that over the last 50 years, those countries that have been the most successful at improving the skills of their populations have enjoyed faster growth.
Countries like Switzerland, Germany, Singapore and Japan – some of the world’s most competitive economies – all score highly on the OECD’s education index.
And in an age when global capital is highly mobile and labour increasingly so too, international comparisons are not just a theoretical exercise. They really do matter in terms of decisions being made about inward investment.
As the global economy continues to change, levels of education and skills will become an even more important factor for inward investment decisions.
And we know that the world is not sitting still.
Our competitors, our trading partners, the countries with large balance sheets that we hope will come and invest in Wales… they all know this.
This is why our vision of a rebalanced economy puts such a strong focus on education and skills – and on the right kind of education and skills.
It explains the strong emphasis we place on rigour and standards within schools. Building on the reforms Tony Blair introduced more than a decade ago, we have continued the expansion of the academies programme and reform of the curriculum.
It is why we have rescued apprenticeships from the scrap-heap of the education sector by elevating and promoting the vocational pathway, creating more than 2 million more apprentices since 2010 and driving up the quality of vocational courses.
And I believe Wales needs this kind of focus as much as anywhere else – perhaps even more so.
Because let’s take an honesty check and stare the facts in the face.
Our economic performance remains at the bottom of the UK league table.
And I hate that.
Yes, 2014 saw some very positive movement in terms of growth and real wages, but the truth is that we have a long way to go yet before we close the gap with the rest of the UK.
Yes, the economic picture in Wales is improving, but we are starting from a lower base.
And if you – as I do – believe in this relationship I have described between educational outcomes and economic success, then we should be asking some very hard questions indeed about Welsh educational trends over the last generation.
It has been said many times before that success in the 21st century will belong to those economies which can harness knowledge and innovation most successfully.
If we really, genuinely believe that statement then we need to be examining our record very carefully and be ready to come to clear conclusions – the first of which will be that we have not been setting our sights high enough when it comes to our vision for Welsh education.
Not when you compare it to our performance in the past; not when you compare it to our UK and European neighbours currently; and not when you compare it against what we think will be the challenges of the future.
Nowhere near high enough.
And when I talk about our aspirations falling short – this isn’t a charge driven by me – it’s coming straight from the business community here in Wales.
Every week I visit businesses in all corners of Wales to learn about the challenges they face and to see what more can be done to support them as they lead the economic recovery in Wales. And every week I hear a familiar call for something to be done to drive up the standards of skills of young people entering the workforce – or I hear of very specific skills gaps in valuable parts of the economy where there are quality job opportunities offering good salaries… but where there are simply not the skills available in the local workforce.
It’s coming from CBI Wales, who in October last year produced a report drawing together all the concerns from business about education in Wales.
And their conclusion?
“Education is, and will continue to be, an issue of critical importance for Wales… too many young people, for too long, have been let down by the system.”
The Institute of Directors too, has previously spoken of “frighteningly low” skill levels among young people in Wales.
If we are willing to stare the facts in the face then the conclusion must be that, when it comes to the education of our young talent in Wales, we are simply not doing well enough.
A few months ago I visited one of Wales’s leading engineering plants – a major regional employer and part of a global company. I was invited to take part in the graduation ceremony for their final year apprentices. After the ceremony I was struck by the educational journey some of those apprentices had been on. Some of them in their late twenties, having already graduated from University, and who had found themselves unemployed with what they now describe as “worthless” degrees, they had chosen to start out again with a high-quality four year apprenticeship.
For those young adults, the apprenticeship was their second chance; the thing that has transformed their life opportunities and their earning potential – more so than the academic letters after their names.
[political context removed]
And I have had the privilege of seeing numerous really excellent Apprenticeship schemes across Wales in the last six months.
Here at Pencoed there is the Sony Wales Academy, training the next generation of leaders, engineers, managers and technicians.
One of my first visits as Secretary of State in July was to Airbus in Broughton where I was given a tour of their factory by some of their apprentices. Those young people could have passed for experienced management – given the depth of passion and knowledge they communicated about the Airbus business.
And I believe business leaders of the future are just as likely to come from the factory floor as the University lecture theatre or business school. Indeed Sony is a good example: three out of the five people on the executive board here are former apprentices.
And this is exactly what the Prime Minister means when he says employers should be able to look at someone with an apprenticeship and someone with a degree and not make any value judgement about who has the more worthy qualification.
We are elevating the status of vocational education.
As David Cameron said: “Apprenticeships are at the heart of our mission to rebuild the economy, giving young people a chance to learn a trade, to build their careers and create a truly world-class, high-skilled work force that can compete and thrive in the fierce global race we are in”
I believe the revival and elevation of vocational skills is one of this Coalition Government’s greatest achievements.
The fact that even in the midst of economic difficulty we have seen two million new apprenticeships created. This is transformational – and we are determined to go further. Indeed, the Prime Minister wants to see three million new apprenticeships created between now and 2020.
But the blue chip apprenticeship schemes offered by the likes of Airbus or Sony shouldn’t be the stand out examples in Wales – they should become the benchmark – a standard of excellence in Wales for all apprenticeships.
That is being ambitious.
And so we need a commitment from the Welsh Government that is at least as strong as the one being given by our Prime Minister for expanding the number and also driving up the quality of apprenticeships across Wales.
But when we talk about vocational skills, of course we often think about practical and technical skills.
But one of the most important vocational skills is being able to read well, or write well, or have confidence in basic maths. I know of firms where part of young people’s apprenticeships is to go back and get the minimum C qualification in Maths or English. Because these are vocational skills too.
And we are kidding ourselves if we believe that we cannot do better when it comes to levels of basic skills in the workforce all across the UK. This is exactly what the Prime Minister was talking about yesterday when he declared that mediocrity is just not acceptable – these are the tough debates we are having at a UK government level and they should be happening in Welsh politics too.
Because more than 40 percent of businesses in Wales say that their workers do not have the basic literacy skills they need.
This is the inconvenient truth which we either commit to tackling in Wales or we – yet again – walk away from because that is the easier path to take.
Let’s take the OECD’s international study of academic achievement, known as Pisa, which compares international perfomance on equal terms.
The latest results showed that yet again Wales was behind the rest of the UK for reading, maths and science.
But not just lower than the rest of the UK - lower than the OECD average.
Rather than being compared to countries like Japan, South Korea, the USA and Germany, we’ve been sliding down the rankings – worse than Estonia, Slovenia, Latvia and Poland. These are the countries whose young people are in direct competition with our own for the jobs of the future.
I want children in Wales to be growing up knowing that they could be working on the Rosetta Probe, or designing the motor vehicles of the future, or working here at Sony developing amazing technology that improves people’s lives in all kinds of ways.
So beyond basic skills: IT, programming and software engineering are at the top of the list of priorities when it comes to Welsh skills. The demand for better and higher level skills will continue to grow as we develop the products and services that the 21st Century needs.
A study by the UK Commission for Employment and Skills found that over one third of businesses in Wales see IT as the most important skill they will be needing in the future.
But here in Wales there has been a drop in the numbers of students studying computer science at university and studying IT in schools.
That Commission also forecast that by 2022 the UK will need an additional 2 million managers, professional and associate professionals.
The Royal Academy of Engineering estimates that Britain needs 640,000 new engineering graduates by 2020.
These will be good quality jobs and I am ambitious for Welsh young people to capture their fair share of these opportunities. But when you look at the numbers of Welsh pupils studying Maths or sciences at A Level, again, the hard truth is that without some serious new thinking the odds are not going to be in their favour.
Or take foreign language skills.
There was a view some years back that English would become the lingua franca of global business and that the power of Microsoft and the internet would reduce the need for language skills.
The opposite has turned out to be true. In the global economy language skills are more highly valued than ever before.
A recent skills survey conducted by the CBI showed that 70 per cent of businesses valued foreign language skills to build better relationships with their clients, suppliers and customers.
Wales has seen a drastic decline in foreign language study since the late 1990s – both at GCSE and A Levels.
And these qualifications are the gateway to foreign language degree level courses, the Erasmus Scheme and so many other life and career enhancing opportunities overseas for Welsh youngsters.
There is too much evidence indicating that the brightest and the best pupils from Wales are missing out on the break-through opportunities.
In 2013 the number of Welsh students securing places at Oxford and Cambridge fell to a new ten year low.
[political context removed]
Talented Welsh youngsters missing out.
But it’s much broader than this.
A century ago, South Wales mining communities invested large amounts of their own money in education – in libraries and reading rooms – so that their children could have more life choices and wider opportunities.
They understood aspiration and knew that education was a gateway to financial security and social mobility.
And in the 21st century we need to be asking if we are still expanding opportunities through education for those who need it most. And as people who love Wales, we should take no comfort at all that last year Alun Milburn’s Social Mobility and Child Poverty Commission found that pupils receiving free school meals in England are 50% more likely to get 5 good GCSEs than similar youngsters in Wales.
Because when you are not willing to ask the tough questions and commit to reform where needed, the ones you fail are the ones who haven’t been dealt the best hand in life.
Children with committed, well-resourced parents will get their second or third chances. But for the children who don’t come home to that, school is often their main and best chance of getting a step up in life.
For those pupils simply saying “we took our eye off the ball” to excuse deteriorating outcomes doesn’t cut it. We need Welsh Ministers to embrace this agenda more positively.
In Westminster there has been twenty years of robust debate and argument about school standards, school structures, school leadership, parental choice – every aspect of the education system. And while there have been some remarkable transformations through the academies programme, the Prime Minister is still willing – as he did yesterday – to stand up on the side of parents and pupils and say that “just enough is not good enough” and that we will not tolerate mediocrity and lack of ambition in the system.
That, I believe, is the kind of honesty and the level of commitment to education that business leaders and parents want to see from Welsh Ministers too.
And the truth is that here in Wales it’s not just a question of reforms not happening, we haven’t even begun to have that debate.
Because strong leadership means asking these difficult questions and facing them head on.
And it is no mark of love for Wales to try to shut down the debate and avoid robust argument.
Welsh parents, pupils and teachers deserve better.
It is one of Wales’s greatest strengths that our nation is less divided socially than other parts of the UK. In Wales, we’re less interested in where you came from, more interested in where you’re going.
It is an unremarked upon fact that both myself and the First Minister for Wales both came through South Wales comprehensives. And that’s exactly the way it should be.
Excellent Welsh state education helped us both – as it did for so many others.
And I know he shares my sense of ambition for the Welsh economy.
But that economic ambition has got to include a vision for excellence and aspiration in our schools and throughout our education system.
We have outstanding teachers in Wales; and inspirational headteachers whose leadership is making a difference – like Heather Vaughan at St Woolas primary in Newport; we have brilliant, highly able students like Ellie Atkinson who has just been offered a place at Yale in the US.
There is a huge amount to be positive about. No-one is seeking to undermine this.
But we can do much better.
And that restless sense of ambition and seeking further improvement is the hallmark of both outstanding education and of those economies that will lead the way in the 21st century.
This is not a comfortable debate to have. But we owe it to Welsh parents, pupils, teachers, and business to start asking these questions.