Mark Dawe, chief executive of the Association of Employment and Learning Providers, calls for immediate government action to alleviate the pending “horror story” facing providers of apprenticeships with non-levy employers

The day the non-levy procurement pause was announced, I remarked to colleagues how appropriate it was that it was Maundy Thursday – the day of the Last Supper, when Peter was told of his three acts of denial.

No, the pause isn’t aimed at stopping subcontractors getting a contract; no (after a lot of lobbying,) the new subcontracting rules won’t apply during the pause; and no, this allocation is not designed to destroy the subcontracting market. Three denials, it’s but starting to get a little suspicious.

As things stand, over the next week we will witness something equivalent to a horror movie: “the slaughter of providers, part one”.

It wasn’t me who lit the bonfire of the providers

I have been accused of inappropriately fanning the flames, but it wasn’t me who lit the bonfire of the providers. As I explained, I am just reflecting the heat I am feeling from AELP members.  That’s my job.

So what is the problem? As levy business starts next week, there are many positive aspects about the apprenticeship policy and levy-paying employers, and many providers are very excited.

But let’s be very clear, it’s only the few thousand-odd levy-paying employers we are talking about here. They make up, as the government keeps reminding us, just two per cent of the employer market.

The horror story emerges in the non-levy world. For those involved, it feels like we are stumbling towards the edge of a precipice, and if the government doesn’t act in the next few days, there will be no return this time.

The allocations announced this week to prime providers, with a handful of exceptions, appear to be a fraction of what providers require to maintain their current run rate, i.e. apprenticeship starts and apprentices already on a programme.

Some providers will run out of money within weeks.

Closures and redundancies will start next week

When the government paused the process, it said it wanted to “achieve the right balance between stability of supply and promoting competition and choice for employers”. This latest decision has tipped the scales towards total instability.

The funding agency might argue that it has given opportunities to the primes to put in a business case for more money and tat they will receive results in July.

However the current reduction in allocation makes it impossible for providers to plan working on the basis of no guarantee of future funding and limited trust in the system.

But worse, subcontractors are being contacted by their primes, often with great regret, hour by hour, and told that there isn’t enough money to support them, so they won’t have any funded starts from May 1.

Closures and redundancies will start next week; come July many of these providers won’t exist anymore and the RoATP will shrink rapidly.

I really don’t think the government understands the seriousness of the situation. I have provided officials some examples, and have many, many more that underline the dire position we are in.

Many officials have voiced their concern about the capacity and readiness of the system and particularly providers.

Have they ever tried to develop a business which only has funding for six weeks? It’s not as if the funding can be claimed without an apprenticeship being delivered – we are not talking grant funding – and I thought the government wanted more apprenticeships, not less.

Without immediate action and additional money allocated, the government will have managed to destroy capacity and the consequences for non-levy businesses, employees and learners will be dire.

Our concerns of “apprenticeship deserts” will become a reality across the nation’s constituencies.

While AELP continues the fight at the centre, for many of their members and local provider networks, the only option is to talk to local MPs and prospective parliamentary candidates about the consequences of this approach.

If the government genuinely cares about delivery to SMEs and social mobility, it will act today. If the government genuinely cares about robust apprenticeships and skills policy to underpin its industrial strategy, it will act today. If this isn’t just an underhand way of wiping out subcontracting, the government will enhance allocations today.

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