David Phillips explains why reform is needed to ensure trainees learn a broader set of skills to suit businesses’ needs.

Presented with the top line figures, most people would assume the apprenticeship programme is in fair shape and they would be right.

In the last academic year, there were around 520,000 apprenticeship starts, more than double the number two years ago.

The programme is also achieving a healthy gender balance among those signing up and the government has now committed to increase its budget from £715m to £764m over the next year.

But on closer inspection, while it is difficult to conclude the programme is broken, it still might need some fixing if it is to deliver the expectations heaped on it.

If the programme is divided into its constituent parts of learners, employers, training providers and government, it is clear it is not yet delivering for business in some major areas.

In the recent Pearson/CBI skills survey, businesses told us they felt marginalised and wanted a greater ownership over the programme. Indeed, 39 per cent of employers thought having the apprenticeship grant paid directly to them would increase participation in the programme.

This was the second most popular response — after ensuring the qualifications design was more relevant to business need.

So there is certainly merit in pursuing this idea, but we need to make sure any new funding mechanism, announced as a result of the current consultation on apprenticeship funding, is easy to administer and appealing to every size of business.

A pilot could help test how well new mechanisms deliver these desired outcomes.

The Pearson/CBI survey also found the programme was not delivering what is wanted by all sizes of employers.

Only 23 per cent of small and medium-sized enterprises (SMEs) that responded are currently taking on apprentices.

This compares to nine in 10 companies with 5,000 or more employees. On a more positive note, the survey found training providers are becoming more responsive to business needs and on almost every point researched, employers are becoming more satisfied with the training delivered by external providers.

We need to make sure any change embraces and builds on the relationship between provider and employer.

In relation to the government, the programme is not doing as much as it could be in addressing the stubbornly high levels of youth unemployment. Some people could be alarmed to learn that despite the overall rise in participation in the programme, the number of under-19 starters fell in the last academic year, while those starting who were aged 25 or over went up by around 50,000.

This has resulted in only 25 per cent of all starters being 19 years old or under.

In addition, the government has publicly set itself the goal of wanting to play a more strategic role in supporting the growth industries of the economy and ensuring it has the right skilled labour force to drive growth.

More than half (52 per cent) of all apprenticeships that started in the last academic year were in the business administration or retail sector.

While these sectors are crucial to the economy, more could be done to encourage a greater number of starts in other areas key to future growth, including life sciences and information technology, as highlighted in the government’s Industrial Strategy.

At present, information technology has only a fifth of the starters of the retail sector, with numbers actually declining last year.

Lastly, we need to ensure the programme is delivering for learners.

This means the skills and experiences they accrue during their apprenticeship must lead to rewarding and valuable careers.

To do this we need to create better mechanisms that capture an apprentice’s experiences and the value gained from doing an apprenticeship.

This data could help determine the effectiveness of different programmes, which would in turn encourage others to consider an apprenticeship.

Whatever system is put in place, as a result of the current consultation on apprenticeship funding, it must incentivise some behaviours and discourage others.

It must address the imbalances which currently exist, without devaluing the brand which has been painstakingly built up so far.

It must not slow the momentum of a programme which is delivering valuable skills to over half a million new starters each year.

It also needs to protect the providers and courses so many businesses value.

In short, it should not try to remake a programme which in many respects is not broken, but at the same time put in place the mechanisms to fix it. While this will not be an easy task, the importance of getting it right could not be greater.

David Phillips, managing director of Pearson Work Based Learning
and Colleges