The reforms to apprenticeships have so far been demonstrably disastrous, says Simon Ashworth, who is pleading for a serious rethink
April 2019 will be seen as the Big Bang for the government’s apprenticeship reforms. This is when smaller non-levy-paying employers will join levy payers on the Apprenticeship Service (TAS), and when – in theory – providers should be free of what the ESFA itself describes as a “clunky” contracting system. We will find ourselves in a much more demand-driven market, where ultimately it will be employers rather than officials who determine which providers grow the most.
Nevertheless, if it is the government’s policy that all apprenticeships should be funded by the levy, then mechanisms may be required to control the growth in demand for apprenticeships from levels 2 to 7 from all employers under a finite budget. Of course if ministers are serious about driving social mobility and productivity, we should be talking about how much to increase the budget, not how we limit spending.
I say only that controls may be required because the first six months of the ‘little bang’ we’ve been experiencing since this May have exposed flaws in the design of the funding and standards reforms – and have led to the 61-per-cent fall in apprenticeship starts compared with a year ago. So if ministers don’t rectify those flaws quickly, constructing TAS models to control demand within a levy-funded budget will become an academic exercise.
For instance, the mandatory ESFA rule that 20 per cent of training under all apprenticeships must take place off the job is deterring private and public sector employers of all sizes, and in our view it is the employer-led trailblazers who should decide what the percentage should be for their particular sector.
Another significant barrier to engaging SMEs which has to be reviewed is the level of employer co-investment towards the cost of the training. AELP’s thinking is that a move towards a sliding scale of co-investment might work better; i.e. the higher the level of apprenticeship, the more the employer should contribute. Apprenticeships for 16- to 18-year-olds and at level two for all ages would require no employer contribution, which would be entirely in keeping the government’s social mobility agenda while also helping to meet Brexit skills challenges and improving productivity.
When you throw the industrial strategy into the mix, one has to consider whether the weighting of co-investment according to sector and the funding caps of standards should be part of TAS modelling as well. It may be that a combination of changes will result in the best approach to tackling the issue.
This is why in its pre-Budget submission, AELP has called for the government to conduct a full and open debate with interested stakeholders now on how growth should be managed under TAS. This will give stakeholders the opportunity to submit or comment on models that could achieve the right balance of budgeted provision and employer/state co-investment across employers of all sizes, different sectors, and apprentices of all ages and at all levels.
Given the chequered introduction of the apprenticeship reforms so far, and the two highly controversial tenders for non-levy provision, we believe the job can’t be left just to Whitehall, and we will be making our views known on what the optimum solution should look like.
The skills minister said at the Conservative conference that she was hearing two different stories from her officials and from employers/providers about how the reforms were progressing four months after they had started. The country certainly can’t afford for her or her successor to be hearing another different story four months after April 2019.
We have to be reaching an agreed approach well before then that makes everyone more comfortable and avoids again the recent fall in the start numbers that we and the Commons public accounts committee were predicting a year ago.
Above all, it must be an approach that better serves our young people’s future and enables more smaller businesses across the country to keep offering apprenticeship opportunities, especially in areas where there are few or no levy payers.
Simon Ashworth is chief policy officer at the Association of Employment and Learning Providers