The apprenticeships programme: progress review inquiry
Closed
What the inquiry looked at
“Scope of the inquiry The apprenticeships programme in England seeks to address two key problems: poor UK productivity compared with many international competitors; and a significant fall in employers’ investment in training in recent decades. The programme aims to develop people’s knowledge, skills and behaviours required for their occupation. Public spending on apprenticeships increased from £1.2bn in 2010-11 to £1.6bn in 2017-18. The budget for 2018-19 is £2.2bn. The Committee's 2016 report on apprenticeships concluded that it was unclear how the Department for Education (DfE) would monitor the success of the programme in important areas, such as the programme's ability to meet the needs of employers. The report also raised concerns that a new apprenticeship levy for employers might incentivise some employers to exploit the system. In spring 2017, government introduced the 0.5% levy for employers with a pay bill of more than £3m. Levy-paying employers can use this money, plus a 10% government top-up, to pay for apprenticeship training and assessment. The number of apprenticeship starts, however, fell substantially after the levy was introduced in April 2017; almost a third of learners reach the end but do not achieve their apprenticeship; and the proportion of new apprentices from disadvantaged areas was lower in 2017/18 than in 2015/16. A recent National Audit Office (NAO) report concludes that, despite making changes to the programme, DfE has not enticed employers to use available funds or encouraged enough potential recruits to start an apprenticeship. For example, the number of apprenticeship starts fell substantially after the levy was introduced in April 2017. In addition, the NAO found that, although DfE has improved its performance measures, it is still not clear how it demonstrates the impact of the programme on economic productivity. The ESFA also has limited assurance that apprentices are spending at least 20% of their time on off-the-job training. Members will use this hearing to questions officials from the Department for Education, the Education and Skills Funding Agency (ESFA), and the Institute for Apprenticeships about the value of the apprenticeships programme and effectiveness of its oversight. Moreover, Members may wish to question the future affordability of the apprenticeships programme.”
The committee's words, from the inquiry page on parliament.uk ↗.
What it found
The Department for Education (the Department) has failed to make the progress that it predicted when it reformed the apprenticeships programme in spring 2017. The number of apprenticeship starts fell by 26% after the apprenticeship levy was introduced and, although the level is now recovering, the government will not meet its target of 3 million starts by March 2020. The Department’s focus on higher-level apprenticeships and levy-paying employers increases the risk that minority groups, disadvantaged areas and smaller employers may miss out on the benefits that apprenticeships can bring. We welcome the programme’s greater focus on quality and, after a slow beginning, more than half of apprenticeships are now started on employer-designed standards rather than the old-style frameworks. However, some employers are using apprenticeship funds to pay for professional training or management courses that they would otherwise have paid for themselves. We remain to be convinced that this is the best use of the available funding in terms of adding genuine value to the economy.
Because of the drop in apprenticeship starts, the Department underspent the programme’s budget by 20% in 2017–18. However, employers’ preference for higher-cost apprenticeships means that the programme is expected to come under growing financial pressure in the coming years. Unless funding is increased, the Department will face difficult decisions about which aspects of the programme to prioritise. It is crucial that these decisions are based on sound evidence, and that they pay due regard to the added value that different types of apprenticeship bring.
What the government said
No government response is linked to this report.
How the inquiry ran
Each dot is a dated item listed on this page, from the inquiry's opening on 25 March 2019 to 22 May 2019.
- Oral evidence 25 Mar 2019
- Report 22 May 2019
What it recommended 4 recommendations · 27 conclusions
1The Department has not set out what productivity gains it is expecting from the programme.
2The way that the programme is evolving risks leaving behind people with lower skills and...
3The Department’s approach to widening participation among under-represented groups has been inadequate.
4The programme is not supporting smaller employers well enough.
5Too many apprentices are being trained by sub-standard providers.
6We do not have confidence in the arrangements for assessing apprentices at the end of...
7In the 2017–18 financial year, the Department spent £1.6 billion on the apprenticeships programme, out...
8Ultimately, the apprenticeships programme is intended to boost economic productivity.
9Following a similar approach, the Department uses a ‘skills index’ as a proxy measure for...
10The value of the skills index increased by 3% in 2016/17, compared with 2015/16.17 Subsequent...
11The apprenticeships programme now covers a wider range of professions than it traditionally has done.
12Apprenticeships are available at a range of levels, from GCSE-equivalent (level 2) to postgraduate degree-equivalent...
13The reduction in availability of level 2 apprenticeships particularly affects the ability of people who...
14Sunderland College also told us that it sometimes had to provide English and maths training...
15The Department aims for at least 25% of apprentices to be from disadvantaged areas but...
16The ESFA told us that it was carrying out research to understand what could be...
17One of the programme’s four main objectives is to draw apprentices from a wider range...
18The programme has no targets relating to gender.
19The Department told us that the proportion of women starting STEM apprenticeships had gone up...
20The ESFA said that employers were taking the issue seriously and that it heard more...
21Money raised by the apprenticeship levy effectively has to pay for all apprenticeships, including those...
22Under the current funding arrangements, the Department had expected that levy- paying employers would spend...
23Levy-paying employers have up to 24 months to spend their funds, after which any unused...
24Ofsted inspected 113 established training providers in 2017/18 and rated 58% of them as ‘good’...
25Over 30% of apprentices fail to complete their apprenticeship successfully each year.
26The Department acknowledged that it was not satisfied with the overall quality of training providers.
27As part of an apprenticeship standard, each apprentice is assessed by an independent third-party at...
28The ESFA told us that there were 220 approved assessment organisations, which between them covered...
29However, Sunderland College told us that, for many of the standards that they were encouraged...
30Each apprenticeship standard also has a quality assurance body which is responsible for ensuring that...
31The ESFA confirmed that the Institute for Apprenticeships & Technical Education was responsible for the...
Evidence
Oral evidence sessions 1
- 25 Mar 2019No witnesses recordedparliament.uk ↗