Asked by Lord Blunkett To ask Her Majesty’s Government
whether they intend to make adjustments to the Apprenticeship Levy
to facilitate the improved working of that programme and to reverse
the fall in apprenticeship starts, including the redistribution and
effective use of any current underspend. Lord Blunkett
(Lab) ...Request free trial
Asked by
-
(Lab)
My Lords, I beg leave to ask the Question standing in my
name on the Order Paper. In doing so, I draw attention to
my interest as set out in the register.
-
(Con)
My Lords, we continue to monitor apprenticeships’ market
performance, including levels of starts and spend. We have
made radical reforms to the way we develop, deliver and
fund high-quality apprenticeships, and further major
changes have the potential to be destabilising. However, we
are prepared to make adjustments when and where they are
required in order to deliver our ambitions and support
quality apprenticeships.
-
I thank the noble Viscount for that Answer, but I am
genuinely at a loss as to why the Government are so
resistant to the calls being made by those who are
committed to the apprenticeship levy and to quality
apprenticeships for changes that would reverse the 26% drop
in the last quarter in starting apprenticeships and utilise
the underspend so that small and medium-sized companies and
associated colleges could undertake the necessary work,
perhaps in the future top-slicing sufficient funds to reach
out beyond the larger enterprises, thereby helping both
individuals and our economy.
-
I hope that I can reassure the noble Lord that the
Government have awarded £490 million to providers across
the country to deliver apprenticeship training for smaller
businesses from January 2018 to April 2019. Today, we have
announced that in April we will be making available an
additional £80 million for starts with SMEs which will
support up to an extra 40,000 apprenticeships. Also, in
terms of flexibility, from April levy-paying employers will
be able to transfer up to 10% of the annual value of the
funds entering their digital accounts to other employers,
including SMEs.
-
(Con)
My Lords, the success of SMEs is critical to the UK
economy, as is a thriving apprenticeship system. For our
SMEs, a central fund enables the Government to fund 90% of
the training programme, which the Minister has alluded to,
leaving only 10% of the costs to be covered by businesses
themselves. Unfortunately, there is still a poor level of
understanding of the levy and how it can be spent among
employers. Does the Minister agree that, although there has
been a drop in apprenticeship starts, calling the new
system a failure is not only a huge simplification but
writes off the new8 apprenticeship system before it has
even had a chance to embed? What apprenticeships need right
now is positivity and action.
-
My noble friend is right to say that we must not lose sight
of what we are actually doing here, which is why we have
introduced these reforms. It is the largest government
reform of apprenticeships that has ever been made. The key
point here is that we are putting quality at the heart of
our reforms. We need to look at how the system is operating
and provide some flexibility in the system, which is the
gist of the original Question asked by the noble Lord,
.
-
(LD)
My Lords, a recent report showed that the UK skills
shortage is leading to an estimated £7.3 billion annual
loss in sales to SMEs, equivalent to approximately 250,000
jobs. The Minister has already mentioned some help to be
given to SMEs, but what is the apprenticeship levy doing to
help SMEs meet the acute skills shortage?
-
I have already mentioned the transfer arrangements. Up to
10% can be transferred by employers to SMEs to help them
take on apprentices. In addition, we have a marketing
programme under way—I highlight the “A” pin on my lapel in
support of National Apprenticeship Week which took place
last week, and there was a lot going on on the radio also.
I think that we will find that the fall we experienced last
year will change and that employers will be taking up more
apprenticeships.
-
(CB)
My Lords, are the Government checking the effectiveness of
individual apprenticeships to make sure that they are
actually working properly for the benefit of the
apprentice?
-
Absolutely, and I can reassure the noble and learned
Baroness that the Institute for Apprenticeships is
responsible for quality and standards. It is the
institute’s sole job to work closely with employers to
ensure that the quality of each apprenticeship is high,
which can take some time, and that the apprenticeship
itself is what employers want, thus helping to increase
skill levels in this country. That is our aim.
-
(Lab)
My Lords, there has been a 30% year-on-year fall in
apprenticeship starts by under-19s. That should be no
surprise because, despite this being a great applied
qualification, the pipeline is being strangled by the EBacc
squeezing out applied learning from the curriculum. STEM is
becoming S and M in schools, as technology and engineering
are being taken out, leaving only science and maths. When
are our schools policy and our skills policy going to
align?
-
I have mentioned to the House before that we have a
National Careers Service up and running. It is essential in
giving proper careers advice that employers in particular
can go into schools and address, and hopefully garner, the
interest of pupils. We are trying to address the skills
shortages. STEM skills and occupational sectors, including
the digital side, are well represented in our move from
frameworks to greater standards and to increasing the
skills level in our country.
-
(Con)
My Lords, does my noble friend know that the Economic
Affairs Committee has been looking at this issue for almost
the last year? We have had employers openly admit that they
are using the levy to fund training that they would have
done anyway. Is it appropriate that the apprenticeship levy
should be used to fund people doing MBAs at business
schools and so on? Surely the resources should be
concentrated on level 3, and in particular on young people,
to give them the skills that they need in the workforce.
-
My noble friend is absolutely right. I had not heard about
this, and I will certainly follow up on the points that he
has raised. The whole point of the apprenticeship scheme is
that it is employer driven; it is what employers will need.
The standards and quality are set by the Institute for
Apprenticeships. We believe it is working well, but I will
look into my noble friend’s points.
-
(Lab)
My Lords, the noble Viscount the Minister should be aware
that young people from low-income families are
underrepresented in the apprenticeship programme. Some 13% of
school children received free school meals last year; only
10% of young people starting apprenticeships had been on free
school meals. One reason for that is that the Government
still do not classify apprenticeships as approved education
or training, with the result that the families of young
apprentices lose the right to claim child benefit and tax
credits. Last month at Oral Questions, I highlighted this
structural barrier to the noble Viscount and asked him to
speak to ministerial colleagues in the Department for Work
and Pensions to try to make it more attractive for young
apprenticeships to start. Has he done that, and if not why
not?
-
I can reassure the noble Lord that I have indeed done that.
If he has not received a reply, and I am sure he should have,
I will follow up immediately and make sure of that. Yes, it
is true that some apprenticeships are on the minimum and I
have no doubt that is a bit of a struggle. Having said that,
many employers are paying more than the average, which is
£6.70 an hour, rather than the £3.50 an hour that is now
going up to £3.70.
|
