Think-tank warns on poor quality of apprenticeships

16 Apr 18

The government will waste £600m on sub-standard apprenticeships in 2019-20, according to the Reform think-tank.

Its The Great Training Robbery report claimed some employers are taking advantage of the government apprenticeship levy, which allows organisations to spend tax contributions on apprenticeship training.

“Some employers have used this opportunity to generate high-quality standards,” the report out on Friday last week said.

“However, other employers appear to be simply rebadging low-quality, low-skill and often low-wage roles as ‘apprenticeships’ instead.”

The levy means that a organisations with an annual wage bill over £3m must report and pay their levy – at a rate of 0.5% of their pay bill – to HMRC through the PAYE system.

Organisations can then use these funds to pay for apprenticeship training.

The report calculated that 40% of “apprenticeship standards” approved by the government since 2012 fail to meet international and historic definitions of an ‘apprenticeship’.

The think-tank said, without reform, in 2019-20 the government will spend £600m on courses “incorrectly labelled” as apprenticeships

Research by the think-tank also found that, in the six months after the levy was introduced (April-October 2017) the number of people starting an apprenticeship fell by 40% compared to the same period in 2016.

Tom Richmond, senior research fellow at Reform, said: “The apprenticeship levy is too complicated for employers, focused on too many inappropriate forms of training and as a result is unlikely to deliver value for money.”

The think-tank recommended that a universal definition of an apprenticeship is introduced and that any apprenticeship that does not meet this definition be withdrawn.

The report also called for the government to scrap its target of getting 3 million people into apprenticeships by 2020, as the focus on quantity is detrimental to quality of the training.

A Department for Education spokesperson said: “We want to see people of all ages and backgrounds getting the excellent training they need to succeed in a wide range of jobs, and we are changing the apprenticeship system to do just that.

“These apprenticeships are designed by employers themselves, to give people and businesses the skills they really need.”

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