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The apprenticeships policy landscape: A bright future?

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The apprenticeships system has seen a lot of change over recent months. The key question now is: What is the future for apprenticeships?

The apprenticeship levy is live (as of the start of April) and a number of wider funding changes are being implemented across the sector; the post-election policy landscape looks like it will continue to be dominated by a focus on employer-led training and skills development.

Although the levy is being collected from large employers there is still a degree of uncertainty for non-levy employers. Some of this is down to the relaunch of the procurement process, which we understand is driven by massive over-subscription of funds available within the system.

Whilst there have been some teething problems, as expected of a launch of a new, large-scale digital system, we anticipate that these will be resolved over the next few months. The question that remains is how will employer behaviours change in respect to their appetite for new apprentices following the introduction of the new funding regime.  We have conducted our own market research and what has become clear is that the area that is most vulnerable is the number of apprenticeship starts in non-levy organisations. These volumes have historically contributed a high percentage of overall start numbers and have been an integral part of the way small employers recruit and develop their workforce.  However, the contributions that employers have always made in-kind, alongside the financial impact of employing Team Members who are on a steep learning curve and therefore less productive, have not gone away. On top of these costs is now the requirement of a cash contribution, which we believe is a step too far and will see large numbers of non-levy paying organisations move away from apprenticeship training.  If this happens, we believe that this will have a negative impact on social mobility as there will be fewer opportunities for young people to participate in apprenticeship programmes at a local level. 

The new Apprenticeships and Skills Minister, Anne Milton MP, has made it clear that she isn’t looking to introduce any bright new ideas, but that she wants to focus on making the reforms work for employers and training providers. This is welcome news for an industry that has faced a lot of change in the last few months, and will hopefully create a period of stability to shape and build a world-leading skills system.

Rest assured, Lifetime will be working together with government and the sector to help shape this landscape and overcome the obstacles that face large employers, SMEs and providers in equal measure.



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