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This blog post was published under the 2015-2024 Conservative Administration

Second Year Anniversary of the Apprenticeship Reforms Levy

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Two years ago, we introduced the apprenticeship Levy to create long term sustainable funding for apprenticeships and to give employers of all sizes flexibility to provide new and existing staff with a range of training opportunities.

The Levy means there is more money available than ever before for apprenticeship training and allows employers to choose which apprenticeships they offer, how many and when. By 2019-20 the funding available for investment in apprenticeships in England will have risen to over £2.5 billion, double what was spent in 2010-11 in cash terms. Since its introduction the Levy has supported almost 313,000 people to start their apprenticeship journey.

The introduction of the Levy was a big and important change, but it was one part of a much wider overhaul of the apprenticeships system following an independent review by Doug Richards in 2012.

The Richards review concluded that apprenticeship training was often poor quality – and sometimes even non-existent – with little investment or support from employers to help apprentices progress in their long-term career. Apprenticeship training was also not giving employers the skills they really needed. In short, the system was not working, except in a small number of cases where employers have had a long tradition of offering exemplary apprenticeships, and it was clear that we needed to reform the system to put quality at the heart of apprenticeships.

Doug Richards’ recommendations included creating the right incentives for apprenticeship training through government (which lead to the creation of the Levy) and using recognised industry standards to form the basis of every apprenticeships. So, we worked with top firms to create new style apprenticeship ‘standards’ to replace the old style versions known as ‘frameworks’, which will all be phased out from next year.

Our new style apprenticeships are now longer, higher-quality, with more off-the-job training and provide for a proper assessment at the end. The new standards are short, concise documents that describe the skills, knowledge and behaviours apprentices should gain, designed by employers themselves. So rather than a course that didn’t develop the skills required to do a job, apprentices now learn exactly what their employers say they need.

This means apprentices can be confident they will gain the skills they need to go on to have great careers, jobs and employers know their workforce will be job ready. In 2017 we also set up the Institute of Apprenticeships to support our drive to improve the quality of apprenticeships by overseeing the development, approval of the new apprenticeship standards and assessment plans.  There are over 400 of our new apprenticeship standards available in a wide range of professions everything from nursing, accountancy, law, nuclear engineering and digital marketing.

The good news is that the number of people starting on the new, high quality apprenticeship standards has been rising year on year, now representing almost 60% (128,000) of all new apprenticeship starts reported in the first two quarters of 2018/19.[1]

Thousands of large employers like Channel 4, Royal Mail and Lloyds Banking Group and Ipswich Hospital NHS Foundation Trust to small and medium sized firms are now embracing the huge benefits apprenticeships are bringing to their business and offering people of all ages and backgrounds the chance to progress. Employers have reported benefits of hiring apprentices such as improved productivity, improved product or service quality as well as the new ideas apprentices bring to their organisation. 83% would also recommend apprentices to other business.

Apprentices also report positive benefits with nearly three quarters of apprentices agreeing that their chances of earning a higher wage in future had increased, and 80% agreeing that their chances of going on to higher levels of training had also increased. Of those who completed an apprenticeship, 90% secured a job or went on to further learning, with 88% in sustained employment.

We have also taken steps to ensure the quality of the training that apprentice receive remains high-quality too by introducing The Register of Apprenticeship Training Providers in 2017. All training providers that want to provide apprenticeship training must be on the register and must meet a rigorous set of criteria. We also set up the National Apprenticeship Service to support the delivery of apprenticeships by offering free and impartial support for employers about recruiting an apprentice.

We recognise there has been a lot of change for employers and training providers, but we have also listened to feedback and have introduced more flexibilities. This includes allowing Levy paying employers to transfer up to 10% of their Levy funds to other employers and this increased to 25% from 1st April 2019. We have also reduced the amount that smaller employers have to invest in training and assessment for new apprenticeships from 90% to 95%.

But while things have greatly improved, we know that outdated and snobby attitudes are still putting people off apprenticeships which means they’re missing out on great jobs and higher salaries – many of them in the sorts of firms graduates look to land jobs with after university. To challenge this, we launched our new ‘Fire It Up’ campaign and website to help shift deeply held views and to promote the benefits of apprenticeships to people of all ages and backgrounds.

Our reforms have made sure that apprenticeships are high-quality and valuable to both employers and apprentices. We have made good and steady progress and we will continue to work with employers and training providers to make sure more people to get the skills they need to get a good job and for employers to get the skilled workforce they need. We will make sure the system evolves to meet the needs of both employers and apprentices.

[1] Further education and skills: March 2019

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