Why are providers charging the maximum apprenticeship price?

8 Feb 2019, 9:30

The apprenticeship levy brought with it a radical overhaul of provider funding, dispensing with fixed rates set by the funding agency.

Instead, the ESFA listed maximum values for apprenticeship frameworks and standards, up to £27,000, but “expected to see employers and providers negotiating on price below the funding band upper limit”.

But, as FE Week reported last March, nearly all providers are charging the maximum rate and failing to do any negotiation.

Claiming more funding than is always necessary would not be a big problem if it were not for the fact that apprenticeship funding is public money.

An experienced manager needs less training than someone new to the role, so the funding should be reduced accordingly.

The ESFA appears to have realised this and beefed up the prior learning section within their 2018/19 funding rules, threatening to take funding back from providers overcharging by failing to account for existing knowledge, skills and behaviours.

And, as we report today, the DfE has commissioned research into “If and how providers and employers are adapting training and the associated costs to take into account the prior learning.”

Providers should pay particular attention to the new prior attainment section within the funding rules, as auditors will be sharpening their pencils.

Increased scrutiny from Ofsted in apprenticeship monitoring reports has also identified providers failing to identify and or make adjustments for prior learning, particularly for existing employees.

Consider this: if all apprentices are funded at the cap it must mean none of them had any relevant existing knowledge, skills and behaviours at the start of the course. Sound plausible?

As if drawing down excessive public funding was not bad enough, consider the impact on the overall budget and those that will miss out.

Apprenticeships for young people and those at the lower levels with no prior learning is shrinking yet the unstoppable rise of existing employees on management apprenticeships continues.

The IfATE has already warned of budget pressures and is pushing down many of the maximum caps.

The ESFA has recently said there is unlikely to be any additional funding for small employers in the coming year.

So it will be an uncomfortable message for many, but providers charging at the cap, with no consideration for prior learning, will only have themselves to blame when the money runs out and the auditors come knocking.

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