Skills Minister Matthew Hancock (pictured, right) has refused to rule out the possibility that employers may have to pay towards the cost of training for 16 to 18-year-old apprentices.
In a webinar from the Department for Education, and in partnership with FE Week, the minister spoke to an online audience of around 500 about the government’s consultation on funding reforms for apprenticeships.
We are looking at the whole system from 16 up — we are not ruling it [mandatory employer cash contributions] in or out.
The consultation, launched in July by the Department for Business, Innovation and Skills, proposes three potential funding models — each of which would result in employers paying towards 16 to 18 apprentice training. At the moment this is entirely funded by the government.
Mr Hancock said: “Apprenticeships are an all-age programme. So the consultation document was written as an all-age programme.
“We are looking at the whole system from 16 up — we are not ruling it [mandatory employer cash contributions] in or out.
“The big picture question is how we fund apprenticeships in the future and apprenticeships are from 16 upwards. That’s the reason the consultation asks the question.”
The webinar, Mr Hancock’s third with FE Week, took place on Thursday, September 26. It was presented by FE Week editor Nick Linford (pictured, left), who interviewed the minister for nearly half an hour, covering the issue of apprenticeship funding reform.
The first reform proposal within the consultation is for a direct payment model to the employer and the second is for a system where government funding is recovered through the PAYE system by the employer.
Under the third model, government funding would continue to be paid to training providers.
All three proposals include an employer cash contribution, who would also negotiate the price of training with the provider.
Stewart Segal, chief executive of the Association of Employment and Learning Providers, following the minister in the webinar, said: “This [cash contributions for 16-18 apprenticeships] is probably the most central area of concern in the whole system.
“I was hoping that because of the lack of detail provided, they would leave this out. I’m not sure the minister made it clear this was something they were considering.”
Mr Segal added he thought the idea of asking employers to contribute towards 16 to 18 apprenticeship costs was “crazy”.
During the hour long webinar, Mr Segal also provided the preliminary results of an association survey on the reform proposals.
He said that, as of September 6, the survey indicated 73 per cent of respondents did not think any of the three options would improve the funding system. Meanwhile, 68 per cent of employers’ responses showed they did not think any of the three options would improve the funding system.
However, if one option had to be chosen, 87 per cent would go for the third option, 11 per cent opted for option two and only three per cent went for the first option.
Among employers, 81 per cent of those who responded said they would choose option three.
The ten-week government consultation ends on October 1.
To listen to the audio record from the webinar click here.