National Audit Office report on the Apprenticeship Programme

Mike Cherry National Chairman of the FSB

The Federation of Small Businesses has responded to the National Audit Office report on apprenticeships with alarm over some of the findings.

The report also flagged a substantial fall in the number of apprenticeship starts since the levy's introduction, from 509,400 in the year before the levy to 375,800 - a loss of 26 per cent - warning that if the employer spend remains low, financial constraints could inhibit future growth.

In 2017-18, levy-paying employers used 9% of the funds available to them to support new apprenticeships, equating to £170m of almost £2.2bn available.

As a result, the head of the NAO, Amyas Morse, said that the Department for Education (DfE) was very unlikely to achieve its target of creating 3 million new apprentices by 2020.

While numerous apprenticeships offered are in traditional motor-trade roles such as technicians, spray painters, body repairers and parts advisors, there are also opportunities for apprentices in roles such as IT, engineering, customer service and business admin.

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"To address this problem, the Government needs to monitor these apprenticeship standards more closely to ensure they are more than just professional training". When the apprenticeship levy was introduced in April 2017, 2 per cent of starts were on a standard, but by July 2018 this had risen to 53 per cent. Employers generally have a positive view of standards - a survey by the Department in 2017 found that nearly two-thirds of employers who had some involvement with standards considered them to be an improvement on frameworks. In 2017/18, 12.8% of starts were at level 4 or above (equivalent to a higher education qualification), compared with 5.3% in 2015/16. The proceeds then go towards paying for more people to start apprenticeships at those companies. Partly because of this, the Department spent less on the programme than it budgeted.

Public spending on the apprenticeships programme increased from £1.2bn in 2010-11 to £1.6bn in 2017-18.

Commenting on the launch of the programme, Martin Riley, senior vice-president at Tarmac, said: 'Investment in skills and training is key to delivering the UK's pipeline of major infrastructure, and apprenticeships are vital educational pathways for individuals starting out in our exciting and dynamic industry. This increase looks set to continue.

Meg Hillier MP, chair of the committee of public accounts, said: "It is concerning that employers used so little of the money available for new apprenticeships a year ago and that the [ESFA] can't be sure that apprentices are spending enough time on off-the-job training".

"It has much more to do to meet is ambitions". "However, it has not set out clearly how it measures whether the programme is boosting economic productivity - the ultimate aim of the programme".

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