All level 7 apprenticeships will be axed, skills minister suggests

The axing of level 7 apprenticeships from levy funding will be “pretty widespread”, the skills minister warned as she suggested a blanket ban on public subsidy for the programmes is coming.

Jacqui Smith addressed apprenticeship levy reform concerns in her speech at today’s Association of Employment and Learning Providers conference, in which she also defended the “independence” of incoming quango Skills England.

Prime minister Keir Starmer announced plans to remove some level 7 apprenticeships from the scope of levy funding to shift resources towards young people training at lower levels during Labour’s party conference in September.

It comes amid strain on the Department for Education’s already stretched apprenticeship budget which has been almost fully spent in the past two years.

Smith said today: “In order to open up the growth and skills offer to deliver new training where it’s needed most, you will be aware that we’ll be asking more employers to step forward and to fund level 7 apprenticeships outside of the levy.

“We know that for too long employers have not invested enough in skills, and that’s something which needs to change. We’re clear that levy funded training is only one element of the investment from employers in the skills needs of their workforce, and we want to encourage and support employers to go further in investing in these training needs as we build towards that responsive and collaborative skills system.”

Level 7 apprenticeship starts are dominated by the accountancy or taxation professional and senior leader standards. But other popular programmes include advanced clinical practitioner, solicitor, academic professional, chartered town planner, district nurse and community nurse specialist practitioner.

Some sector leaders have praised the decision as it removes so-called “deadweight” costs – paying for training that would have happened anyway in the absence of the levy.

But other training providers, universities and employers fear that removing all level 7 apprenticeships from the levy will disproportionately hit the NHS, schools, councils and the civil service which often spend their levy on these apprenticeships.

Pressed on whether the DfE and Skills England will engage with the sector on potential areas to keep in scope of the levy, Smith said this will happen but suggested it is unlikely any standards will survive as the removal of funding “will be pretty widespread”.

She said: “We absolutely need to hear the evidence, the examples, exactly that type of information about where we might be able to make some changes to enable us to make these decisions.

“I just don’t want in six months’ time for people to say I wasn’t honest. We are going to have to shift funding from level 7 in order to be able to fund the other priorities that I have set out. I wouldn’t want people to leave this room with an impression that there will be a lot of flexibility around that.”

Asked directly if this means all level 7 will be cut, Smith replied: “More than some people hope, I suspect.”

AELP has argued the level 7 axe could be avoided if the £800 million gap between the amount taken in by the apprenticeship levy from employers and the actual programme budget was plugged.

Smith said she has “made this point to the Treasury”.

Skills England independence fears ‘wrong’

Labour consistently claimed in opposition that its proposed new skills body, Skills England, would work across government to fix the “fragmented and broken” training system. The party has since set up the organisation in “shadow” form, appointed an interim chair from inside the DfE and advertised for board members and a chief executive.

Last month we learned the new organisation will be set up as an executive agency within the DfE rather than as an independent body, and the £130,000-a-year CEO role will be at senior civil service director grade, reporting to the director general for skills, Julia Kinniburgh, which is more junior than people expected.

Smith attempted to dispel the fears of a lack of independence.

She said: “Skills England will have an independent board which will provide leadership and direction, as well as scrutiny to ensure that it’s operating effectively and within the agreed framework. We have had hundreds of applications for that board, and very, very many applications to be the chair of Skills England as well.

“It will be close enough to government to be the authoritative and driving voice to inform policy development and to ensure that the whole of government is brought into the priorities that it identifies.

“The idea that Skills England would not be both independent from and challenging to government, I think people will realise is wrong when we announce our chair.”