Uncertainty has often surrounded how the government defines success for its apprenticeship reforms.
Recently, however, Skills Minister Alex Burghart set two laudable parameters for measuring the effectiveness of apprenticeships - more young people aged 16-24 and more small and medium sized employers involved in the programme.
If the government wishes to uphold the principle of levy-paying employers maintaining choice over the level, the age and the sector for their apprentices, then it is a real challenge for the programme budget to satisfy this at the same time as getting more young people and SMEs into the programme.
The total English apprenticeships budget is not set to increase from £2.5bn to £2.7bn until 2024-25. Officials are understandably cautious about managing the apprenticeship budget before the increase, as shown in the current refusal to lift the 10 annual starts cap for medium-sized firms.
Paid for out of the programme budget, the Plan for Jobs employer incentives have ended and allowing for the annual school leaver recruitment period, the government will monitor the data very closely over the next few months to see what impact their abolition will have on young people and SMEs.
Of the 186,000 incentive claims up to 11 April 2022, 77% were for 16-24 year-olds, while starts among small employers have also shown signs of recovery.
A fall-back in starts for young people and smaller businesses would relieve the pressure on the budget but it won’t deliver on the skills minister’s objectives. In the meantime, levy payers will carry on using their levy entitlement as they were before the pandemic.
And so, if the two aims set by the Skills Minister are to be achieved, a more radical set of reforms is needed. Here are ten reforms to make apprenticeships better in England.
(1) 16-18 Apprenticeships funded through the 16-19 Education Budget
16-18 apprenticeship funding needs to be taken away from levy funding and returned to mainstream DfE budgets. There is already general support for 16-18 apprenticeships to be funded out of the 16-19 Education budget.
(2) Higher funding rates for 16-18 year olds
The cost of managing and supervising 16-18 year-olds is higher than adult apprentices. Many have higher needs and are more challenging to train. Funding rates need to rise to reflect this.
(3) Reinstate funding incentives for 19-24 year-olds
There are still 250,000 young people in England who are unemployed not in full time education. We need the Treasury to reinstate funding incentives for 19-24 year-olds for Level 2 and 3 apprenticeships to encourage employer recruitment as we near the new academic year in September.
(4) Fully fund level 2 and level 3 apprenticeships for 19-24 year-olds
The Treasury and DfE should agree to fully fund Level 2 and Level 3 apprenticeships for non-levy paying employers. No stone should be left unturned to prevent employer recruitment of 19-24 year olds on apprenticeships.
(5) A standalone SME budget
If the Skills Minister is really committed to engaging SMEs in apprenticeships, a standalone SME budget is required if levy-paying employers’ demand for apprenticeships is going to remain unrestricted.
(6) Dampening Demand for Level 6 Apprenticeships
It is difficult for the Skills Minister to have it both ways: more Level 6 apprenticeships and more Level 2 and 3 apprenticeships for 19-24 year-olds. A choice has to be made. Demand for Level 6 and above apprenticeships should be dampened by requiring a significant amount of employer co-investment.
(7) End levy transfers
Only 5,500 levy transfers have taken place so far this academic year and 37% of them were made to levy payers. Aside from providing metro mayors with nice photo opportunities, it is hard to see what value this clunky and bureaucratic scheme adds. The scheme should be abandoned and unspent levy put back in the pot for SMEs to access via the Apprenticeship Service.
(8) Flex the off-the-job training rule
The employer trailblazers should decide what percentage of off-the-job training is required for each apprenticeship standard and how the requirement is applied. Too many employers, especially SMEs, are put off engaging in the programme by the 20% rule which, despite best efforts to explain otherwise, is still often interpreted as the apprentice being unaffordably off work one day a week.
(9) Improve guidance on mentoring
Apprenticeship completion rates have taken a significant hit during the pandemic; but an ongoing issue which needs to be addressed in relation to drop-outs is that the mentoring of an apprentice should be better defined. In a work-based learning environment, some employers have to recognise that they share responsibility with the training provider for mentoring. Better guidance is needed.
(10) Review end point assessment (EPA) arrangements
Another growing frustration is employers cancelling their apprentices undergoing their EPAs because they don’t regard EPA as important as sitting an exam. Online EPAs, which have the potential to be more robust, can also be open to abuse and the ability of all apprentices to access remote invigilation remains an issue. EPAs should stay but a stocktake by the authorities is required.
Aidan Relf is a Public Affairs Consultant