E&S19: Where next for apprenticeships?

10 July 2019

The Association of Employment and Learning Providers (AELP) believes that apprenticeships can drive improvements in workforce productivity at all levels.  The programme should also be a vehicle for social justice.  Other key stakeholders feel the same, which was evident when the Commons Education Committee chair Robert Halfon recently challenged the secretary of state Damian Hinds on whether the apprenticeship levy was doing a good job in supporting the social justice agenda in the light of falling apprenticeship starts at level 2.  More level 2 starts will almost certainly mean making ‘hard choices’ about the levy which the Department for Education permanent secretary discussed in another Commons committee session earlier in the year. While at the AELP annual conference last month, we had the opportunity to ask Anne Milton, minister for apprenticeships and skills, which choice she would make if she was still skills minister at the end of July.

In response, the minister floated the possibility of a current salary limit on any would-be apprentice to potentially reduce the number of higher level apprentices and thereby free up more funding at the lower levels.  We have known for some months that in the absence of any increased funding for apprenticeships now or from the spending review, everything is on the table as far as hard choices are concerned and that the policymakers are busy modelling them.  In simple terms, the government is considering age limits, prioritisation of sectors, a cap on levels and/or a salary limit.

It’s a dangerous game to crystal ball gaze on the likely outcome of this review, especially when we are likely to get a new set of ministers at the Department who might have a different outlook to the current team. We also see Brexit uncertainty casting a pall over the public finances.  We do know that if Anne Milton were to stay in post, she would almost certainly put her pen through any suggestion that apprenticeships should no longer be an all age programme.

Prioritisation of sectors takes us to that age-old Whitehall minefield of trying to pick winners when the global economy is changing so rapidly and future jobs are so difficult to predict because of artificial intelligence and automation.  And in terms of priorities, for example, will the government make the funding viable for adult care apprentices even when the case for training more of them is very strong?  The salary cap idea is interesting in that it does correlate with the Migration Advisory Committee (MAC) and Home Office discussions on limiting the number of migratory workers earning less than £30k a year.  But it is frankly another minefield and the Home Secretary has reportedly told the MAC to go away and think again.  A £30k limit on the earnings of an apprentice would, for example, have major implications for the levy spending efforts of the NHS Trusts.

This brings us to the question of whether all levels of apprenticeships should be eligible for levy funding. In AELP’s spending review submission to the Treasury, we make clear that all levels should be supported even if it requires the levy’s scope to be widened or its rate to be increased.  Our input into the Augar review also suggested that the higher education budget should be a contributor to the funding of degree apprenticeships as more universities successfully apply to be on the apprenticeship provider register.

The simple truth is that without a hard choice being made, the money for apprenticeships will soon run out for everyone, including those offering apprenticeships at the highest levels.  Of course a new skills minister might be thinking that this government’s apprenticeship policy is an amazing success and we could get even more productivity, social justice and support from business if we found more money to support more apprentices at all levels.  Let’s not accept a debate that is a negative; we should all join together to fight for the positive.

Simon Ashworth is chief policy officer at Association of Employment and Learning Providers

Employment and Skills Convention – 10 July 2019 #EmploymentSkills19