Today’s new review looks at coverage of apprenticeship funding and student loans.
Today, 5 September 2016, it was reported that 55 MPs have called on Apprenticeships and Skills Minister Robert Halfon to rethink apprenticeship funding plans. The MPs claim that a proposed cut in funding would “hugely undermine the government’s pledge to create three million apprenticeships by 2020”.
The story was picked up by the Guardian, Times and Mirror. The coverage claims that alleged cuts are ‘contradictory’ to the government’s views on social mobility.
However, this is misleading as it does not fully take into account the work we are doing to overhaul the apprenticeship funding system, including:
- Increasing the budget for apprenticeships to £2.5 billion by 2019-20, double the 2010-11 budget in cash terms.
- Putting funding in the hands of employers. The system needs to be simple for them to navigate, choose the apprenticeship training they want to purchase and negotiate on price.
- Government currently funds apprenticeship frameworks at different rates depending on the age of the learner. We are proposing to allocate each individual framework pathway to a single funding band, regardless of the age of the learner, or geographic location. This will bring frameworks into line with the existing funding system for trailblazer apprenticeship standards and dramatically simplify the experience of employers.
- Employers with fewer than 50 employees will not have to pay anything towards the cost of training a 16 to 18 year old apprentice, young care leaver or young person with an Education and Health Care plan.
- Under the current system of frameworks, government pays a training provider more than two and a half times as much to train an 18 year old apprentice on a Level 2 Business Administration course in Greenwich than it does to train a 19 year old in North Kent – only 35 miles away. So we’re evening out the costs of each apprenticeship. Providers will need to adapt but we’re making sure there’s more money going in overall.
- For all STEM framework pathways we propose to increase the current government-funded adult rate by 40% at Level 2 and 80% at Level 3 and above, and then allocate these frameworks to the nearest funding band. This is because employers of these apprentices are currently disproportionately likely to be paying extra to providers on top of the funding provided by government.
Apprenticeships and Skills Minister Robert Halfon said:
This government is doubling investment in apprenticeships because we know they create a ladder of opportunity for our young people. Through the new levy £2.5 billion will be invested in apprenticeships by 2019-20 - twice what was spent in 2010-11. That means more money going in to the system and more money on average per apprenticeship.
We want to encourage employers to take on young people. That’s why they won’t have to pay more to give a 16 –to 18-year-old their first step on the career ladder and why we’re proposing to give employers an extra £1,000 for every young apprentice they take on. This will help to ensure every young person, regardless of background or ability, has the chance to take their first step into work.
Today, stockbroking firm, Killik & Co published research which it claimed reveals student loans are now one of the most expensive ways to fund university education, if they are not repaid immediately upon graduation.
This story was covered by the Daily Mail, which claimed that the average student from a median-income household will only fully repay their loan if they are studying to work in two areas - medicine or law.
This is misleading. Although we know there is more to be done, our reforms to higher education are making sure that students get better value for money and courses are delivering the skills that employers need, increasing their access to a good job.
A Department for Education spokesperson said:
Graduates continue to enjoy higher employment rates and an average £9,500 annual earnings premium compared to non-graduates.
We know there is still more to be done to improve value for money in parts of our HE system – which is exactly why we are introducing measures such as our Teaching Excellence Framework, which will incentivise all universities to raise the quality of their teaching and focus on improving graduate outcomes.
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