Is this a golden chance to improve the Apprenticeship Levy?

Is Rishi’s chat with Businesses on the Apprenticeship Levy a Golden Chance to long term improve Apprenticeships for everyone?

In case you missed Chancellor Rishi Sunak’s Spring Statement earlier this week, he mentioned something that grabbed my attention.

Rishi highlighted that UK employers are spending just half the European average on training their employees, the Chancellor said he will examine how the tax system, including the operation of the Apprenticeship Levy and how it can be used to encourage employers to invest in adult training.

The Chancellor highlighted that just 18% of 25-64 year olds have vocational technical qualifications and this is a third lower than the OECD average. He said he will work with businesses over the summer to examine and consider the Apprenticeship Levy and if it invests enough in Skills.

Roll forward to a few days later… A Government spokesperson said:

“There will not be a formal review of the Apprenticeship Levy or system. We are committed to protecting the quality of apprenticeship training and improving the system to respond to the legitimate concerns raised by employers. We will ensure that apprenticeships continue to meet the needs of employers.”

So between now and the Autumn Rishi is going to be engaging with employers to ensure that Apprenticeships continue to meet the needs of employers… not an Apprenticeship Review. DfE made it really clear to me… it is not a review of the Apprenticeship Levy!

We don’t need another Apprenticeship Review

Good, we don’t need another Apprenticeship Review – they take AGES!… and what good do they do? Really?

What we do need is to iron out some of the creases and bumps that have been there for a really, really long time and could now be the time to fix these?

Personally, I highly rate Rishi, he wrote a great exclusive for us last year. Total confession, I am also a bit obsessed with the Rishi / Treasury Flickr account and I really think this could be a Panini Sticker book of the future. I like him.. I also highly rate Nadhim, I met him at the AoC annual conference last year and he genuinely seemed really alright. These are also two people (and of course their teams) who get stuff done. If you are going to transform things, you need a team of people to get stuff done… big tick there for me on the Senior Leadership team.

So is this a massive opportunity to fix a bunch of problems that have been there for ages in the Apprenticeship World? Erm, yes, I think it is.

We need a more Agile Apprenticeship System

Personally, I have found people who are achievers, roll up your sleeves and get it done types, don’t like reviews and formal consultations, they take too long, by the time you’ve finished, it’s already out of date.

Rishi and Nadhim seem a lot more Agile to me and to be Agile you need regular reviews, track it is going in the right direction and also look at what is changing around you and adapt.. quickly.

What went wrong with the Apprenticeship Levy in the first place?

Now for a bit of background reading if you need it.. I know many of our readers have been living it for ages… but if you would like a bit of background reading.. my mate Tom Bewick wrote a fantastic piece last Saturday titled: What went wrong with the Apprenticeship Levy?

I wonder if Rishi checked it out before this week’s Spring Statement? It is a fantastic article and was the most read exclusive article on FE News last week! I highly recommend checking it out.

So what do we need to fix in Apprenticeships?

Now my colleagues and friends in the sector and wider Apprenticeship eco-system. This is where you come in. We need to be solution led… what do employers need? What does Rishi and Nadhim need to know about?

Personally, I have a few suggestions.. but as a sector we need to come together to offer a solution led approach.. not stakeholders shouting about their corner – to fix this we don’t need more funding for colleges, or Training Providers… but we need to think, what do employers need? We need to be joined up, with big picture thinking.

Personally, I would love to see a few things ironed out in Apprenticeships:

Apprenticeship Funding and System needs to be easy for busy employers to navigate

For Employers – make the funding, process and system easier to deal with. If we are having to pay FE Funding consultants money to navigate the system… then it is broken and too complex. It should be simple and easier to Navigate.

A really easy fix would be to sort out the Apprenticeship website for employers!.. and get some UX (user experience) specialist on it please.

There will be calls to have a rename from the Apprenticeship Levy to the Skills Levy… is that so bad?

There will be calls to have a rename to the Skills Levy… to open it up to more types of training and beyond Apprenticeships… but will this mean that Apprenticeships take a big drop as employers want something else?

In one way, if an employer pays in, should they be able to upskill and re-skill their existing staff to what they want? ..but at the same time surely the Apprenticeship Levy shouldn’t replace a training or HR budget for a large corporate?

If we did rename the Levy… should we have a rethink that the Levy should be for new staff, and not upskilling existing staff?

I know this is a total marmite thought… you either love it or it makes you physically sick… but not being funny Apprenticeship starts fell off a cliff when the Apprenticeship Levy came into play… Eg: Between May and July 2017 (quarter 4 of the 2016/17 academic year), apprenticeship starts decreased to 43,600 from 113,000 over the same period in the year before (quarter 4 of the 2015/16 academic year), a decrease of 61% … so do we need a re-think on how to increase the number of Apprenticeship starts?

Top tip… if it is still being communicated by DfE as the Apprenticeship Levy.. Apprenticeships will be in.. if it is just called the Levy… erm it will be opened up to other things!

The future of work and the fourth industrial revolution is fast emerging around us. We need to deliver Apprenticeships to support the fourth industrial revolution, not shoe horn in something that doesn’t work for employers or apprentices.

Do we need to rethink Apprenticeships?

Do we need to rethink Apprenticeships? – maybe explore the Flexi-Job Apprenticeships a bit more?.. but also learn the lessons from Kickstart and improve things… particularly with the agency part of Flexi Jobs and what we learnt in Kickstart. .. but we do not want, nor need an Apprenticeship review to complete this!

How can we increase Entry Level Apprenticeships?

The London Progression Collaboration released a report during the recent National Apprenticeship Week in 2022 that there has been a 72% drop in Entry Level Apprenticeship starts since 2014… you what?!

Surely this is something that should be on Rishi and Nadhim’s list of stuff to sort out!

Can something be adjusted to make sure we increase the number of entry level Apprenticeship roles with employers? Is this in the Levy.. or something else?

So personally, I think we need to encourage employers to create more entry-level Apprenticeships… but how do we ensure we don’t remove vocational progression routes? I am massive fan of Degree Apprenticeships… but surely they should be a part of the mix, not taking away opportunities to start entry level Apprenticeship roles?

We need both Entry level Apprenticeship and Degree Apprenticeships.. what do we need to adjust to help employers make this happen?

Apprenticeships for all Employers

Now I hope and pray that Rishi when he is chatting with employers about Apprenticeships he is going to talk to not just large employers, but SME’s (or start ups and scale ups).

Now we know it is easier to meet the big employers and get the great photoshoot on a digger or at a manufacturing plant.. but we need to also include Apprenticeships into the start up and scale up portfolio and make it easier for entrepreneurs to navigate the system.

Now I know the Apprenticeship Levy is paid by large employers.. but if we are looking at Apprenticeships and Employers, we need to include both large and small employers into the mix and have joined up thinking. We need to have an Apprenticeship system that is easy to navigate and also supports all employers. So the Apprenticeship system is easy for both large corporate HR departments and busy entrepreneurs to navigate the Apprenticeship system. It should be helpful to employers, not a full time job to work it all out.

What is alarming is that Anna Ambrose highlighted in her recent article on FE News:

“There is a strong correlation between the fall in entry-level apprenticeship starts, and those in SMEs which fell by over 36% over a similar period. We know SMEs traditionally offer apprenticeships weighted towards those at lower levels and are a vital employer of young people in local entry-level roles”

We need to engage more SME’s – many SMEs / Entrepreneurs / Start ups / Scale ups don’t have strong relationships with large Apprenticeship Levy paying employers, so how do you also support them as well? If you don’t have a relationship with a large corporate, how do you make it easy to access unused Apprenticeship Levy funding pots?

Do SME’s need a separate funding pot for themselves to promote Apprenticeships? The £3,000 employer incentive was incredibly well received, personally, I would love to see this or similar come back into the fold.. maybe an employer incentive could be just for Entry Level Apprenticeships with SME’s – fixing two things at once?

I think Rishi will have many connections with large employers looking to chat with him. He may find it harder to find SME / scale up / Start ups to chat with… Rishi if you are reading this, I would highly recommend my mate Anthony Impey to have a coffee and a chat about Apprenticeships with. If you want to do it remotely, Anthony has the best bookcase ever!

How do you support Providers? (I mean all Providers: Colleges AND Independent Training Providers).

We all know it is easier (and probably smarter) for providers to target large employers with big levy pots of funding and large sign up numbers.. how do we help Providers also support and access SME’s?

As it makes sense to target an employer with 50 staff to sign onto a programme at once… compared to potentially a similar time to go to a single SME and take a similar amount of time to find a learner and sign them up onto programme. How do we support providers to support all employers?

How do we encourage more Diversity and Inclusivity in Apprenticeships?

If we are looking to improve Apprenticeships for employers and learners. Then we need to try and improve diversity and inclusivity in Apprenticeships.

Now Rishi if you want to chat with some Apprenticeship diversity experts, I would recommend my mates Saf Ali and Isa Mutlib. We need to encourage more diversity in Apprenticeships, the figures are shocking. … and also in leadership in the delivery of Apprenticeships so if you are looking to change this Rishi and Nadhim, it would be a good plan to grab a coffee with Robin, Amarjit, Stella or Janak at the Black Leadership Group. We need more representation in learners… but also in Apprenticeship delivery.

We also need to address issues around hidden inclusivity in Apprenticeships – it would be a cracking idea for Rishi and Nadhim to chat with my mate Dr Louise Karwowski  Head of Science at Cognassist or Prof Louise Kirby about supporting employers and learners with overcoming hidden barriers with neurodiversity in Apprenticeships.

Whilst we are thinking of inclusivity. How do we help employers and Offenders more with the recent developments in Apprenticeships for Prisoners?… we don’t just want a tiny pilot, but a full on impactful roll out.

How do we encourage ‘all age’ Apprenticeships?

The recent ONS Labour Market figures are pretty alarming reading.. as Low unemployment masks largest fall in labour force participation among over-50s since records began.. now I am totally up for incentivising entry level Apprenticeships, particularly for young people.. but how about helping career changers and continuing to help older Apprentices?

Someone who is 50 has at least 15 years remaining before they retire, that is a long time and they have a lot of experience to enrich the team around them on their apprenticeship… let’s not forget older learners as well and their value to employers.

Apprenticeships transform lives!

So to be honest… great shout by Rishi in the Spring Budget… there is a load that could be ironed out on Apprenticeships to make them more suitable for employers, but also for learners!

I don’t have all of the answers to this… but sector colleagues and friends – Rishi needs some suggestions, solutions and ideas.. and FE News is here for you to share these. So please, please do.

I am a glass half full kinda guy.. I hope and pray that Rishi’s conversations with employers will be agile, will be honest, open, creative, solution led and will lead to an improved Apprenticeship and FE system for everyone.

Isn’t it fantastic that we have a Chancellor that wants to spend the Spring and Summer exploring the World of Apprenticeships and how to improve this for employers? …but he needs help, he needs solutions and a way forward to improve things. This is honestly a golden opportunity to share some forward thinking views and improve the Apprenticeship system for everyone.

Gavin O’Meara, CEO and Founder FE News