The drop in apprenticeship starts since the introduction of the levy is getting even more severe, the latest monthly government statistics reveal.
The number of starts in March stood at 23,900 - down by more than half from the provisional figure of 50,000 for March 2017, according to statistics published today.
This 52 per cent drop is the steepest decline yet, after the year-on-year drops in January and February stood at 40 per cent and 31 per cent respectively. This is due to a significant increase in apprenticeship starts in March and April 2017, ahead of the introduction of the levy.
The new statistics follows the publication of an open letter by apprenticeships and skills minister Anne Milton and business leaders yesterday, which defended the apprenticeship programme. "Giving people choice is essential, whether they pursue a technical route or an academic one. That’s why we should support employers in making use of the levy, and in providing opportunities for people to learn, earn and get on in life,” the letter stated.
On the day last month's statistics were published, Ms Milton appeared to play down the significance of the government's 3 million apprenticeships target, insisting: "We won’t sacrifice that quality just to meet the target that was set."
Today she said the government "had anticipated this drop in the number of people starting apprenticeships".
'Apprenticeships must now be high quality '
Ms Milton added: "March 2017 was the high point in the use of the old style apprenticeships that were in many cases not fit for purpose. What matters is the move to the new style apprenticeship standards.
“The number of people taking up these new, higher-quality apprenticeships has increased rapidly beyond our expectations. Apprenticeships must now be high quality – and we won’t sacrifice that principle to increase quantity.”
“The apprenticeship levy and wider changes to the system offer employers a real opportunity to change lives. We are working with businesses, small and large to make sure they recognise the opportunity apprenticeships give them to grow their business and get the skilled workforce they need.”
Last week, former skills minister Nick Boles, who helped set the 3 million target, said it was "always a nonsense".
Overall, there were 261,200 apprenticeship starts between August 2017 and March 2018 – down by more than a quarter from the 362,400 recorded in the equivalent period in 2016-17.
'Action has to be taken'
The figures are provisional, with the final data due to be published in November.
Mark Dawe, chief executive of the Association of Employment and Learning Providers, said: "AELP strongly supports the levy and we understand why the skills minister sent out a joint letter with employer supporters to the press this week in defence of it.
"But we hope that when she addresses the AELP conference in a few days’ time, she will signal a suspension of charging SMEs for apprenticeships for 16- to 24-year-olds at levels 2 and 3. With the government showing no intention of abandoning its 3 million target, start numbers are now so far behind the curve, action has to be taken now to reverse the falls. They are damaging to productivity, social mobility and the labour market response to Brexit."
Stephen Evans, chief executive of the Learning and Work Institute, said: "The government's target of 3 million apprenticeship starts by 2020 looks increasingly out of sight. The government will claim quality is rising, but we think it's far too early to say that. Critics will say the levy isn't working, but we're clear it was the right move. McVitie’s, our Festival of Learning award winner, shows the difference the levy can make when employers use it to support people development and improved productivity.
"Changes are needed to make apprenticeships work better. But this should be about reforming the current system, not ripping it up. We must improve quality, including beefing up the Institute for Apprenticeships approvals process, so all apprenticeships match the best in the world. We must also focus more on making sure anyone - and particularly young people - who could benefit can get an apprenticeship. We should be planning now to reinvest any underspent levy funding in widening access, boosting quality, and other ways of improving workforce skills."
Shadow apprenticeships minister Gordon Marsden said the figures were "further damning evidence of the deep concerns from Labour and across the sector. The government are continuing to ignore the widespread concerns about apprenticeships following the introduction of the levy. Labour and sector voices have called for an urgent reassessment of the process. The government have their head in the sand and their failure to review is now causing major damage to the apprenticeship brand.
“Government must get a grip on the starts fiasco and the concerns about the levy rapidly. Otherwise they will jeopardise the huge life chances apprenticeships offer young people and also the long-term prosperity of our economy.”
Ann Francke, chief executive of the Chartered Management Institute, said: “The drop in the number of apprenticeship starts shows that government needs to make apprenticeships a lot more flexible and a lot less bureaucratic. This is a transformation - not a tweak - and needs to be much more clearly communicated and managed."