Asked by
To ask Her Majesty’s Government what assessment they have made of
the survey by the British Retail Consortium, published on 17 May,
which concluded that the apprenticeship levy scheme was “not fit
for purpose”; and what steps they intend to take to modify that
scheme.
The Parliamentary Under-Secretary of State, Department for
Education () (Con)
My Lords, the apprenticeship levy has enabled government to
increase apprenticeship funding to £2.7 billion by 2024-25. We
are continuing to improve apprenticeships to meet the needs of
employers and drive up their quality even further. This includes
developing more flexible training models that provide improved
pathways for young people to access apprenticeships, while
simplifying the transfer of levy funds, which will enable
employers to make greater use of their funds and support smaller
businesses.
(Lab)
I thank the Minister for that reply. Some of the Government’s
so-called improvements were actually announced a year ago, but
this report was issued last month, so they are not working. The
BRC is not alone: the food industry and manufacturers are all
equally critical of the levy in its present form—in fact, it
faces opposition from 80% of employers. We all want to create a
higher-skilled and more productive workforce, yet entry-level
apprenticeships are declining, letting down the very young people
who would benefit most, while more levy money is being spent on
management and other courses for existing employees. When will
the Government put this right and introduce the sensible changes
proposed in this and other reports?
(Con)
I do not accept the noble Lord’s assertion that the changes that
the Government have introduced are not working. Clearly, the
context of the last 12 months, with the pandemic, has had a major
impact on the confidence and ability of employers to recruit more
generally. But, in the year to date, apprenticeship starts are up
17.4% and the number of starts among young people under 25 has
risen to 55%, up from 50% the previous year.
(LD)
The creative industries have also found the apprenticeship levy
scheme to be not fit and have asked for modifications; I thank
the Minister for listening to these concerns. Around £55 million
of apprenticeship levy funds raised within the creative
industries cannot presently be spent to support the training of
their own workforce, so we welcome the flexi-job apprenticeship
agency pilot project, launched yesterday, which is looking to
address these issues. Will she look into how this can be
sustainable and affordable for the sector after the initial
investment runs out—in other words, beyond the pilot?
(Con)
I thank the noble Baroness very much for acknowledging that we
absolutely have listened to the sector with the flexi-job
apprenticeships. She will be aware that there is enormous
flexibility for larger employers to spend up to 25% of their levy
funds, potentially, with their supply chain, as might well apply
in a case like this.
Lord McLoughlin (Con)
I congratulate the Government on what they are doing in focusing
attention on apprenticeships. Does my noble friend agree with me
that one of the things that is very necessary is for young people
to see how successful apprenticeships can be? This can be done by
promoting them through schools and her department; I know that
the Secretary of State is keen on this. How many civil servants
in her department have come from an apprenticeship scheme to get
to their present status there?
(Con)
I absolutely agree with my noble friend. We are doing a lot of
work to make sure that we can connect young people in schools and
colleges with employers and providers much earlier in their final
academic year—rather like how they connect with universities—to
give them confidence about where they are going. On my noble
friend’s specific question, I say that the department has
achieved an average of 2.6% of our employees over the four years
of the target. We are increasing our apprenticeship starts, and I
am delighted to say that one of my excellent private secretaries
started in the department as an apprentice.
(CB)
My Lords, as an officer of the Apprenticeships APPG, I hear two
constant concerns from employers about the levy: its lack of
flexibility and the difficulties for small employers wishing to
offer apprenticeships. I too welcome the concept of flexi-job
apprenticeship agencies to smooth the path for SMEs, but there
are only 16 of these so far. What are the Government’s actual
goals for SME apprenticeships, and how do they plan to achieve
them, given that current incentives and support schemes are
clearly not working well enough?
(Con)
The noble Lord is a bit harsh; we are very focused on SMEs, in
part because of the productivity potential that apprentices can
offer them, but also because of the opportunities that they offer
to young people. I am not aware that we have published targets
for this, but it is a particular focus in the department.
(Lab)
My Lords, in February this year, IPPR North reported a 72% fall
in entry-level apprenticeships since 2014. The London Progression
Collaboration has revealed a major decline in entry-level
apprenticeships in the capital, while starts in high-level
apprenticeships, often taken by older people, have skyrocketed.
SMEs report that apprenticeship starts fell by more than 36%
following the introduction of the levy in 2017. I acknowledge the
successes of the apprenticeship levy but, given the priority to
help young people through skills training, including
apprenticeships, and the levelling-up agenda, and given the
obvious problems, can the Minister explain why the Government
have ruled out a formal review of the levy as part of their wider
considerations?
(Con)
I think the noble Baroness would acknowledge that some of the
changes that we have introduced, including the levy, to create a
sustainable model of funding for apprenticeships, reflect some of
the problems of quality identified in the Richard review in 2012.
I hope that she would also acknowledge that we have seen an
important growth in degree apprenticeships. She is absolutely
right that we have seen a drop in intermediate apprenticeships,
but that is a principal area of focus for the department going
forward.
The (CB)
My Lords, following on from the question of the noble Baroness,
Lady Bonham-Carter, are the Government continuing to consult the
creative sector to assess how well the new flexi-job scheme fits
the bill and, importantly, provides the necessary number of
apprenticeships, including in the theatre industry, where such a
scheme particularly needs to be targeted?
(Con)
I absolutely reassure the noble Earl that the department is
actively engaging with all key sectors, including the creative
sector. On the specifics, obviously the apprenticeship model is
push and pull. The department is delivering what employers are
asking for, but we need employers to respond to that across every
sector.
(LD)
My Lords, what efforts is the department making to get schools to
know about apprenticeships and go into them? Currently, schools
are measured largely on GCSEs, A-levels and university entrants.
When will they be able to celebrate their apprenticeship leavers
with the same enthusiasm as they celebrate their university
entrants?
(Con)
As the noble Baroness will be aware from our debate last night,
it is not the Government’s plan to micromanage schools in terms
of how they celebrate. We are promoting apprenticeships in
schools and colleges through our ASK programme—the Apprenticeship
Support and Knowledge programme— the Get the Jump programme and
the Skills for Life programme. She may have seen some of the
materials from Get the Jump recently, which were very
engaging.
(Lab)
My Lords, I respect the Minister’s good intentions, but how does
she account for the catastrophic fall in the number of
entry-level apprenticeships at intermediate level in the past
five or so years? It is no good pointing to figures that show
that we have done a bit better than we did in the disastrous
Covid year. Let us have a look at the long- term position. She
says that the department regards this as important, but what
conclusions is it drawing and what is it going to do about
it?
(Con)
Our conclusion is that we listen to employers and respond to what
they ask for. I shall give the noble Lord one example. Employers
have told us that they need young people to be more work-ready.
Therefore, we are funding up to 72,000 traineeship places over
the next three years.
