Countdown to end of apprentice loans continues

No date has been given for the abolition of adult apprenticeship loans, despite Business Secretary Vince Cable’s (pictured left) announcement last month that the system was being dropped.

The Student Loans Company confirmed it was still processing applications for apprentice FE loans while it awaited government instructions to stop.

Dr Cable told FE Week three weeks ago he “accepted” the policy had failed and that it would be axed, although non-apprentice FE loans would remain.
Just 569 advanced learner loans have been taken out for apprenticeships in the nine months since they were introduced, compared to government forecasts that 25,000 would be taken out this academic year (by July 31, 2014).

Dr Cable said: “The advanced learning loans system has taken off for non-apprenticeships, but for apprenticeships we accept it has not succeeded and we’re dropping it.

“Regulations have to be put through Parliament to conclude it [apprenticeship loans system], but we’ve accepted it didn’t work and there’s no shame in that, but it will continue with the non-apprenticeship learners.”
An official announcement on the end of the apprenticeship FE loans system had been expected in the annual skills funding statement, which was postponed at the end of last year.

However, Skills Minister Matthew Hancock (pictured left) confirmed Mr Cable’s comments later the same day.

“While the newly available loans for FE have seen higher than expected demand, loans for apprenticeships have not,” said Mr Hancock.

“With the confirmation of a new funding system for apprenticeships in the Autumn Statement, now is the right time to reinstate co-funding for all apprenticeships ahead of more fundamental reforms, details of which will be publicised in the new year.”

The slow uptake has long-prompted concerns from the likes of the National Institute of Adult Continuing Education (Niace) whose chief executive, David Hughes, said the low figures confirmed that loans for apprenticeships were a “failed” policy.

He added: “We would like to congratulate the government for recognising this and accepting that they need to act, and to act swiftly.

“We are, of course, anxious to see the detail of the new proposals. Whatever is proposed, we are sure the government, employers, learning providers and learners and their representatives will need to work together to understand the full implications of this policy and how best to take it forward.”

Mr Hughes said adult apprenticeships were “essential” for both the economy and social mobility.

However, he said the axing of apprenticeship loans had left the group concerned about where future savings might come from, and about the possibility that loans might become the only funding mechanism for adults at intermediate and lower levels of learning.

“We hope that any consideration of introducing loans for other age groups and other levels of learning in the future will now be postponed,” he added.