(For the full event report from ‘The Future of Apprenticeships’ conference, click here)
Good morning everybody.
For those of you that know me, I’m always delighted to be talking about apprenticeships. There’s absolutely no doubt in my mind, and I hope in most of your minds I think, that apprenticeships, if done right, can add massive value to the employers that are engaged in it. But just as importantly, if not more importantly, to the individual that is actually going through the apprenticeship programme and so on. There is huge amounts of evidence around that.
As Susan said, we’ve had a fairly spectacular couple of years regarding growth, and yet, size definitely isn’t everything. It’s not the most important thing, and I will come in a minute to quality, because in the last six months or so there’s no doubt the agenda around quality and the type of apprenticeships, and the experience and so on, has risen pretty rapidly up the agenda.
But If I just put some of the growth – because while the whole agenda this morning is about the future of apprenticeships, I think it is quite helpful to look in the rear view mirror for a few minutes – because that should inform the policy and what we will be delivering as the National, Apprenitceship Service (NAS) in the future.
And just to put that in context, as Susan said, in the last 12 months, or the last academic year, an increase of 36 per cent in the number of employers and employment places that have been engaged in the programme. If you look at the success rates which again, Susan referred to, 74 per cent last year and still rising, and if you go back to ‘world class apprenticeships’, the view that if we achieve 75 per cent we would truly be world class.
I want to also dispel, if I can, a few myths if they exist in this audience, and the wider audience that are watching this. I hear all the time, isn’t it such a shame that all apprenticeships and all the growth is around adults – what about young people? Well let me put that in context – in the last two years, with all the growth we’ve achieved across the programme as a whole, 29 per cent of that growth has been 16 to 18 year-olds in an incredibly tough employment market for young people. 64 per cent has been 19-24 year-olds.
I very rarely hear people either criticise or raise questions around that 16 to 24 agenda. But also very importantly, in the last 12 months, whilst 25 plus has grown incredibly over the last 12 to 18 months, last year, 89 per cent of all apprenticeship programme funds went to 16 to 24 year-olds, and I think that’s a really stunning number.
So when you do read those articles, and If you feel in the next ten, twelve minutes I feel a bit defensive, you’re absolutely right. Because actually, I think it’s a very British disease in my view, sometimes taking something which is potentially a great success story and then looking at the sort of 5, 10 per cent on the margins. And I’m not for one minute standing in front of you or anybody else saying that we’re satisfied about that 5 10 per cent which is not right. Our job is to identify that, focus on it, fix it and move forward.
But 90 per cent, of apprenticeship funds, as nearest dammit, was spent on 16 to 24 year-olds, not the 25 plus programme.
Also very importantly, when I first started this job Lord Young, who was a Labour minster, and I was employed initially into that administration. Every time I head him speak as the skills minister he talked about apprenticeships being on life support. And he used to talk abut the late 90s when 60,000 people started an apprenticeship in this country, and only 25 per cent completed it. And How we can even get our heads around the fact that you’d say that 15,000 people in 1999/ 2000 completed an apprenticeship. 15,000. That’s probably the number that would go and watch Brentford play football or something, I don’t know, I’ve never been to Brentford, but… it’s a pretty small number!
And then we talked a great deal about how we could compete in a global world in global markets, with the Koreas, the Singapores and the Brazils, I spent the day yesterday at JCB – JCB, again a little fact that you may not know, I certainly didn’t, they are 3 per cent of every pound, 3 pence in every pound of UK exports is down to JCB.
Where is the biggest growth for them? Russia, Brazil, China. Where are the biggest threats to them? China, Korea. Other countries in the world that have invested huge amounts in vocational skills and skills generally.
So the point very much to me is that there are things, without being overly defensive, that we want to focus on and I’ll come to those in a minute in terms of part of our future agenda, but if this was on life support as a programme, 10-11 years ago and quite clearly if you look at the numbers it was, I really feel that some of the criticism is a bit (as-surgeon?) and I, it was very nice of Susan to give me personally any of the credit for it because I think I should take the least of the credit, I work with an extraordinary group of people right across the NAS, across the department, in the commission and in the whole sector with providers and in particular I would say the provider network who have done so much to improve things like completion rates, and quality that with that as I say extraordinary growth we’ve also got to look at some of the other statistics around level 2.
And there’s quite a lot of, in my view, snobbery around level 2. But a significant proportion is first time. And I think when we are providing funding into some of the larger organisations in this country, we’re not actually giving, in my experience, when I was responsible for the apprenticeship programme in British Gas, I promise you I didn’t even know that that our government was funding. It was completely irrelevant to us. What we really wanted to do was train a whole generation of new British Gas engineers.
The investment was about the individual. That’s why the money goes to providers, that’s why it flows through, to changing the lives of the individuals. And the one thing I’ll tell you right now, the Morrisons and Adsa’s or whoever you want to pick on, the one thing they’ll not do with their people is provide a nationally recognised level 2 qualification. They would never do it. And yet that is a passport for thousands of their people, and I don’t care whether they’re 32 or whatever, a passport to a better future and we owe, and I think Michael and I discussed this earlier, if you look at the lot of the data in the commission, that most of the skills gaps in this country actually exist in our existing workforce. It’s not in the 10 to 18 year-olds that are coming up through the educational system.
We do take quality incredibly seriously. As much as anything else because we are the owners of the brand.
We are the guardians of that brand and there is no doubt that apprenticeships that are done in five weeks or sometimes 12-13 weeks, is there enough, real incremental, additional learning going on – is this about accrediting prior learning and if it is, it really is not an apprenticeship. And it does irritate me when people call it a five week programme, a short duration apprenticeship – its not an apprenticeship at all – how could it be?!
The fact that someone has taken some young people and put then on a five week training programme, and I have no idea whether that 5 weeks added value to that young person or not and then decided to call it an apprenticeship for funding programme doesn’t make it an apprenticeship.
The fact is that we and the SFA and the department need to be all over this to protect the brand.
And I would put a lot of this provision now into 3 segments.
Some of which quite clearly is not an apprenticeship, never was, shouldn’t be called it and we need to stop that immediately and withdraw funding, and in some cases where it’s clearly an abuse of that funding, get the money back from whoever received that funding.
There’s another group a lot of the, I say, the 12-13 week apprenticeships, and some good examples where it could have looked like an apprenticeship before SASE and the implementation of SASE, but actually it’s really good provision when you look at it.
And if Ofsted look at it, the SFA look at it, It’s really valuable for the the people that are going through that 12-13 week, 20 week programme…
But there is not enough embedded learning in there and therefore what we’ve got to do is say it’s not an apprenticeship, is there an alternative use of, or funds so that we can actually carry on paying for that to happen because there is clear evidence of positive outcomes for the young people and so on.
And then of course there are apprenticeships themselves as a whole.
The other point about short duration, and I’m not now talking about five weeks, although I think it’s just ridiculous calling them short duration apprenticeships, they were recorded like that from whoever did it. But as I said, we’ve got to deal with that very quickly.
But when it comes to say, a programme that last four or five months, part of the question we’ve got to have is well lets go back to the framework. Every single framework, as most of you in this room know having implemented SASE, we went through the whole specification for apprenticeship standards in England, or SASE, if you look at SASE, we went through a process with many people in this room and right across the sector – completely re-egnineering and reworking the frameworks so that they were SASE compliant.
And every single SSC puts within that framework a recommended time period. So we are going to look at every single one of the frameworks and every one of the programmes which are being delivered materially in less time, with that question of why are you doing it in significantly less time, why are we paying you for it, and as I said to you, if only 10% of the money in the last year went to 25 plus you can see we’re already paying a very very very heavily discounted rate for 25 plus.
But it doesn’t matter, we don’t want to pay £1 to anybody to say you’ve delivered an apprenticeship if it’s one that actually not one that is really an apprenticeship and there isn’t embedded learning in that and also the period of time to prove the skills have been embedded.
So we have a whole programme now around looking at quality and the minister has said very clearly in the last few weeks that the absolute priority for us as an agency is quality, quality, quality.
But I also think that duration, in its pure sense and completion rates are sometimes quite a poor proxy, for quality, they’re quite crude measures. So we’re currently undertaking, which we went out and commissioned about 5 or 6 months ago, before a lot of the questions I guess were raised…
We’re talking to 4,000 employers, 5,000 apprentices through a very major research programme about how did it feel for you – how was long was the programme? If you’re an apprentice, did you get enough time off the job to do what you wanted to do? Because with 450,000 starts last year and only 300 of us at NAS I know we’ve got thousands, hundreds of thousands, of eyes and ears whether they’re journalists, or people in the sector or providers who all the time are keeping an eye on quality – and i hope they’re feeding it back to us – and that is incredibly valuable.
The other thing, without being overly defensive – some of the data that comes through through the SFA is lag data – so someone could run a five week programme, finish it three months ago, by the time they submit the data and call it an apprenticeship we’re five, six months behind that. And it could be an MP which we’ve had a case very recently, a parent went to an MP in Eastbourne and said why has my son just done an apprenticeship, it was 5 weeks and there was no job at the end of it – of course, that was the first we could hear of it.
So the more people that are in the sector that understand clearly and clearly defined, good quality apprenticeship, and we’re all on the case, then what we can do is if we’ve got five, six, seven per cent of the programme which we collectively would agree is substandard, I’ll tell you what, between us we could get it down to 4 per cent, and then we’ll get it down to 3 per cent. Will it ever be perfect? I don’t think so, I honestly don’t think that 450,000, 500,00 starts, every single one will be perfect. But I tell you what. We’ll get as close to perfection as we possibly can.
Our priorities for the future remain 16-24 year-olds, despite the growth, but most of the money, 90 per cent of it, I keep repeating it, are going to the younger cohorts. One area we are concerned about and the minster is access to apprenticeships. We ave a very small pilot running at the moment for 10,000 people, because if you look at the vast majority, of the over 1 million 16 to 24 years-olds who are not in education, or in training, or in employment, if you look a that group there’s probably a huge chunk of them that actually if the job was there for them to do they could walk into it tomorrow.
But there’s also another, very sizable segment of that group that if they put in front of an employer who had a job, they wouldn’t employ them because they dont; think they’re ready for employment, they don’t have the employability skills, they may not have the level of functional skills.
So we are looking with the department, without extra funding, about how do we enlarge an access programme to make sure that those people who are furthest away form employment get an opportunity at least to be able to put their hand up and say I want to apply for this apprenticeship and in applying for it I’ve at least got an chance of being employed, rather than no, no, no, I’d never employ you and no-one else ever would.
The wage subsidy was mentioned, very important for, this is for the SME’s or employers employing less than 50 employees, and it’s ignited a whole group of people – we know it worked well, we ran it last year, the good thing about the pilot, I was quite worried about it, that if you gave a subsidy, whether employers would take it, and would there be sustainable employment at the back end of it. All the analysis we’ve done of that 5,000 pilot we did, just coming up for 18 months ago, was that the retention rate was high if not higher than the programme was a whole into full time sustainable employment. So that’s a good step forward.
We’re working on the loans strategy. And interesting, it’s been out for consultation, lot of debate fro employers about how that’s going to work, a lot of detail to work through in terms of how loans relate to apprenticeships going forward.
The growth strategy is going to be announced next week, and I don’t want to turn this into a mutual admiration, but I would honestly say in the 2 and a half years I’ve been involved in the public sector the relationships between the agencies, SFA, NAS, and the department, is better now than it’s ever been. And i do think the combination of bringing together business, and skills, the B and S in BIS together under one director general has made a really big difference.
To make sure that strategy, i.e. policy is being informed by delivery and we feel very much in the 6, 9 months have been much more engaged in the debates, and I would say as a delivery arm we have for some time been quite concerned about even in previous regimes about this drive for quantity and volume, and I think there is now a sea change going on where there is a view well lets have fewer numbers but lets make sure they’re the right ones going forward.
We had the bid process for 25 million around higher apprenticeships, we had 132 bids come in and next week we’ll announce the winners of those bids as we drive much more for growth in higher and advanced level apprenticeships and again, I think someone said all the growth is in level 2 – if I go back to the last 12 months, advanced apprenticeships grew by 69 per cent last year, and higher apprenticeships by 43 per cent – so again, let’s get off the it’s all level 2, it’s all crud. It’s not, there’s some good stuff going on somewhere.
Finally I just want to say it has been I think a pretty fantastic couple of years driven i think primarily by the provider sector, by employers really understanding the business case, I think we collectively, those people involved, whether you’re directly or not, we’re transforming the lives of many many thousands of people that have never had a level 2 in their lives. That and as I said is a passport to a better future for all of them. It is about up skilling and re-skilling, not just about new, young people coming to the workforce, but we have to focus more, there is not infinite money, the growth we’ve had in apprenticeship funds in the last 2 or 3 years will not be linear and will not just grow exponentially.
So greater focus on value for money, on quality, and better outcomes. But thank you everybody for those of you that have been involved in this who I think ab put apprenticeships very clearly back on the agenda, back on the map in the last 2 years.