Minister refuses to offer transparency on apprenticeship levy spending

Donelan says the government is instead focused on the 'key stats that really matter'

Donelan says the government is instead focused on the 'key stats that really matter'

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A top minister has refused to say whether the apprenticeship budget is still at risk of becoming overspent while revealing there are no plans to publish more transparent data on levy spending.

Joint HE and FE minister Michelle Donelan said the government is instead focused on the “key stats that really matter”, such as the number of people taking up apprenticeships and growing the programme’s brand.

She was speaking to FE Week to mark the 15th annual National Apprenticeships Week (read the full interview in our souvenir supplement – out on Monday).

Further education leaders and commentators have demanded greater transparency from the government on apprenticeship levy spending ever since the Institute for Apprenticeships and Technical Education first warned the budget could go into the red in December 2018.

Months later the National Audit Office reported that the new-style apprenticeship standards were costing “around double what was expected” and warned of a potential “overspend in future”.

Then permanent secretary of the Department for Education Jonathan Slater told the education select committee in 2019 the levy budget “could be significantly overspent if we carried on, on the basis of current trends”.

Then skills minister Anne Milton later said the government was considering restrictions on employer usage of the levy, potentially by introducing a “pre-apprenticeship salary cap”.

But there has been radio silence from the government on the matter since then – perhaps partly due to the Covid-19 pandemic stifling starts numbers.

Donelan, who was appointed as universities minister in February 2020 and became joint HE and FE minister in September 2021, remained tight-lipped about the sustainability of the apprenticeships budget.

Asked repeatedly by FE Week whether the budget could be overspent in the near future, the minister dodged the question. “We are a government that has a primary focus on driving up apprenticeships at all levels, including degree apprenticeships, and I’m working with universities to ensure that becomes a reality year on year,” she said.

However, Donelan took issue with the notion that the apprenticeship budget could go “bust” as this “implies the whole thing is going to collapse, which is certainly not the case.

“I wouldn’t want anybody to be put off taking an apprentice because of this notion,” she said.

The minister, who also attends cabinet, added that the DfE is “always reviewing” the levy to “make sure that it is working as efficiently as effectively as it possibly can”.

The government has also been criticised since the launch of the apprenticeship levy for shrouding spending data in secrecy.

While there are vast amounts of statistics published about starts numbers, nothing is available for how much is spent annually by individual employers, whether they are levy- or non-levy payers, how much goes towards funding English and maths apprentices’ training, the ten per cent levy account top-up, and other aspects of the programme that the whole budget funds.

FE Week has been able to find out that some apprenticeships funding has been handed back to the Treasury in recent years, but very little national level data about levy spending is available.

Asked whether the government planned to make the spending more transparent, Donelan said “no… I think that the key stats that really matter are how many apprentices we have and how many employers we have got engaged because this is about ensuring that apprenticeships can open up opportunities for so many people.

“We’re really focusing on spreading apprenticeships and making sure that they’re a viable and available option across the country, because of the role that they can play in levelling up and reskilling and upskilling.”

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