The apprenticeship levy is a “blunt instrument” too focused on raising participation levels, a parliamentary sub-committee has concluded.

According to the sub-committee on education, skills and the economy’s report, published today, the government’s flagship apprenticeship policies, which aim to deliver 3 million apprenticeships starts by 2020, lack focus. The programme should be restructured to involve a stronger sectoral and regional focus, the MPs said.

The apprenticeship levy, due to be introduced next week, will be paid by large employers across the UK and help fund the growth of the apprenticeship scheme. But instead of simply focusing on achieving the target number of starts, the government should focus on outcomes and judge apprenticeships by whether those completing them find employment, according to MPs.  

The committee recommends that the government publishes an annual report setting out the skills shortages on a national, regional and sector-specific basis and set clear targets. An annual survey of performance against clear outcome measures such as completions, progressions to higher levels and relevant employment secured should also take place, while Ofqual should have a greater role in regulating new-end point assessments. The creation of the Institute for Apprenticeships was welcome, MPs said, but it  had to be given sufficient capacity and independence if it was to succeed.

More support for apprentices, which could include changes to the benefit system, was also necessary, was also necessary, said the report. This echoes an amendment to the Technical and Vocational Education Bill backed by the House of Lords earlier this week.

‘Apprenticeships are a means to an end’

Neil Carmichael, co-chair of the sub-committee, said the government had failed to show how its three million target and levy would help train young people for the jobs the economy needed.

“Ministers must recognise that apprenticeships are a means to an end and not an end in themselves. They need to place greater emphasis on outcomes, focussing on areas of the economy where training is most needed, and ensuring quantity does not trump quality,” he added.

Iain Wright, co-chair of the sub-committee that wrote the report, said the government’s policies on apprenticeships were “inherently contradictory”: “Ministers have a centrally-dictated, top-down 3 million target, welcome though that focus is, at the same time as insisting that this approach will be bottom-up and address the skills requirements of individual firms, sectors and regional economies. These requirements will often be very different and the government should target those sectors of the economy and regions of the country where skills shortages are particularly acute.”

FE and skills sector welcomes report

Mark Dawe, chief executive of the Association of Employment and Learning Providers, welcomed the report and said MPs had done “a valuable service in reminding us that there are still too many people out there who should know better telling young people that apprenticeships are a second choice option”.

However, he said the report did not address the worrying issue of funding apprenticeships for 16- to 18-year-olds under the current levy reforms. “ Employers are saying to training providers that the government’s additional incentives of £1,000 to the employer and another £1,000 to the provider will make little difference to the negative impact of the new funding rates, especially for the higher-cost, higher-level apprenticeships, and the basic costs are higher anyway for the youngest age group,” Mr Dawe added.  

Teresa Frith, senior skills policy manager for the Association of Colleges, said: “The government is keen to see high level apprenticeships in STEM subjects, but we may find that what employers need or want is a more generic apprenticeship at a lower level. Individual employers will understandably focus on what is best for their own business, rather than what is necessarily best for the UK or even their own sector. The pattern of demand and delivery is still unknown.”

Mary Bousted, general secretary of the Association of Teachers and Lecturers, said the government’s “blinkered approach is resulting in the needs of learners and the labour market being lost”.

“We share the Select Committee’s conclusion that these reforms will not fill skills gaps, as the availability of apprenticeships varies significantly by sector and between areas of the UK,” she added.

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