Asked by Lord Fox To ask Her Majesty’s Government what
assessment they have made of the effectiveness of the
Apprenticeship Levy. Viscount Younger of Leckie (Con) My
Lords, the apprenticeship levy is an important part of our reforms
to raise the quality of apprenticeships. We are seeing real
improvement in the quality of apprenticeships as...Request free trial
Asked by
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To ask Her Majesty’s Government what assessment they have
made of the effectiveness of the Apprenticeship Levy.
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(Con)
My Lords, the apprenticeship levy is an important part of
our reforms to raise the quality of apprenticeships. We are
seeing real improvement in the quality of apprenticeships
as a result of our wider changes. The number of people
starting on new employer-designed standards is almost 10
times higher than last year, but there is still more to do
and we continue to engage closely and regularly with
businesses as they plan their future apprenticeship
programmes.
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(LD)
My Lords, I thank the Minister for his Answer but, if he
will excuse me, it is papering over the cracks. Last autumn
we saw a big fall in the number of apprenticeship
registrations, in February they were down 40% and in
March—the latest numbers we have—they are down 58%. This is
not a blip; this is a trend. When will the Government
abandon their completely unreachable and unworkable 3
million target and really focus on quality?
-
We are certainly not going to abandon this: we believe that
it is working well. We have explained already that it takes
time to bed in. Yes, I acknowledge that starts have
dropped, but we make a comparison year on year to last
March when there was a considerable spike in the old
apprenticeships. At the moment, 37% of people doing an
apprenticeship are now starting on standards, compared to
3% last year.
-
(Con)
My Lords, is the Minister aware that apprenticeships at 16
and 18 have fallen in the last two years? To call people in
their 40s, 50s and even 60s apprentices is not really a
meaningful expression of what they are doing. Is he also
aware that youngsters at 16 will not be employed as
apprentices by companies because at school all they are
studying is a narrow, academic curriculum and all technical
subject are being squeezed out of our curriculum? We are
the only country doing this and it should be stopped.
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The whole gist of our programme is to ensure that anybody
who wants to become an apprentice can do so, but the main
thing is quality. We are very much focusing on standards
and the Institute for Apprenticeships has a mandate to
focus on quality. Quality is important, rather than
quantity.
-
(Lab)
My Lords, can the Minister say how long it will take for the
British system to come up to the same level as Germany’s?
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We are in a very favourable position in comparison to Germany
because, for example, it has 30% off-the-job training and we
are going for 20%. As the noble Lord will know, this is part
of a two-year programme, so we have deliberately given
employers who pay the levy two years in which to bed in these
new changes and get used to the process. We believe that that
is happening.
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The Lord
My Lords, is the Minister aware that for small businesses and
voluntary organisations the process of drawing up the
standards is very complicated and time-consuming, that there
is little guidance on this and no financial help for it from
government, and that since the levy was introduced the grant
for apprenticeships has fallen from £6,000 for an 18-year-old
to £2,500, so the YMCA tells me? That makes it unviable for
the YMCA to offer apprenticeships.
-
I understand what the right reverend Prelate says. However,
we have increased the funding for providers, particularly on
the non-levy side. I hope that he can be reassured that small
businesses are being helped by our encouraging better
providers for them.
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(CB)
My Lords, apprenticeships and the levy are a key element in
delivering the UK’s vital needs for skills and human capital,
but they are not the only element. What are the Government
doing to develop an overarching skills strategy, embracing
not just apprenticeships but all the different elements of
skills development, including the proposed T-levels? How do
they plan to monitor progress towards reaching the overall
goals of such a strategy?
-
The noble Lord is quite right that although the
apprenticeships programme is a major one for us, it sits
alongside other programmes. He will know that we announced in
our industrial strategy in November 2017 that we wanted to up
the progress, covering technical education. For example, we
are investing an additional £406 million in maths, digital
and technical education to address the shortage of science,
technology, engineering and maths. This is a complementary
programme.
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(LD)
The Minister will know that the Chartered Institute of
Personnel and Development says that a fifth of employers and
a third of SMEs are writing off the levy as a tax, rather
than investing it into apprenticeships. Will the Government
consider extending the deadline for spending the
apprenticeship levy from 24 months to 36 months, to give
sufficient time to develop new and more rigorous
apprenticeship standards?
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We have already extended it from 18 months to 24 months and
we think that that is fine. We are seeing strong signs that
it is picking up, with the employers buying into the system.
We always said that it would take some time, as I think the
noble Lord knows. For example, we are seeing vacancies up and
that is very encouraging.
-
(Con)
My Lords, the apprenticeship levy offers organisations the
chance to review their workforce strategies, diversify their
workforces and address skills shortages. Does my noble friend
the Minister therefore think that any underspend of levy
money should be ring-fenced to be invested strategically, to
tackle identified sector skills challenges?
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I think we made it clear that if there is any underspend, it
will become apparent probably no earlier than May 2019. It is
clear that if there is any underspend, the money available
will go back into apprenticeships, so it is important that
the focus is on these new level standard apprenticeships.
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(Lab)
My Lords, the Minister will be aware that most business
schools have set up management courses to be paid for by the
levy. These courses are for mature managers. Was this part of
the Government’s intention?
-
No. I know that the possibility of MBAs being attached to
apprenticeships has been raised in the House before, but that
is not the case. It is clear that the system is rigorous so
it can check that apprenticeships are up to the right
standard and are launched so that they cannot be dressed up
as other types of qualifications.
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(Lab)
My Lords, under the co-investment rule that applies as part
of the levy, the 10% that members have to pay towards the
cost of apprenticeships means that many of them are unable to
access the levy funds. Given that the Government have next to
no chance of achieving their target of 3 million
apprenticeship starts by 2020 without the support of the
small business sector, will they consider piloting the
suspension of co-investment in order to let small businesses
play their full part in boosting the number of apprentices?
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The noble Lord makes a good point about the 10%, but we want
to introduce the transfers in a gradual and well-managed way,
allowing levy payers to benefit from the added flexibilities
while protecting the integrity and affordability of the
programme and the interests of non-levied employers. I
reassure the noble Lord that we are carefully monitoring the
implementation of the transfers, including how the 10% is
working.
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