Small business wooed in a bid to stem the tide of young jobless

Ministers offer #163;1,500 to companies taking on 16-24 apprentices

Where there's a summit, there must be a crisis: ministers surely did not want to invite comparison with the Eurozone in launching a summit on apprenticeships this week, but it was the first concrete sign that the concerns over their runaway growth are being taken seriously in Whitehall.

Education secretary Michael Gove and business, innovation and skills secretary Vince Cable held their summit with business leaders in the wake of concerns that the growth was focused mainly on over-25s and was doing little for youth unemployment, as well as claims that quality was suffering in the race for numbers. Their plan aims to encourage more small businesses to take on younger apprentices, offsetting the amount spent on huge conglomerates, which arguably could afford their own training. And it also requires apprentices to reach higher standards in literacy and numeracy.

Grants of #163;1,500 will be offered to small businesses to encourage them to take on 16 to 24-year-olds and every apprenticeship will be required to include literacy and numeracy to GCSE level, instead of level 1 - a change that would have meant tougher standards for functional skills in 290,000 apprenticeships last year, nearly two-thirds of the total.

Responding to the announcements, colleges said ministers underestimated how much work was needed to help large numbers of students who failed to reach GCSE level at school, and the change could put the success rates of apprenticeships at risk. "It could have an immediate effect - it might move that backwards," said Joy Mercer, director of education policy at the Association of Colleges (AoC).

The grants are likely to have a lesser effect. They will be offered to 20,000 small businesses hiring an apprentice for the first time, potentially sparking a 7.5 per cent increase in the number of under-24s if all the grants are taken up.

"We are re-concentrating on quality. When you grow a system very rapidly, you inevitably reach a moment where you have to focus on quality," FE minister John Hayes said. But he claimed it was the Government's own agenda of improvement, rather than a response to criticism. Poor-quality provision, such as apprenticeships lasting just 12 weeks, should be shut down, he added.

The 12-week apprenticeship may not die so much as reappear under another name. One such programme, run by the hotel group De Vere, would be better branded as access-to-apprenticeship training, the National Apprenticeship Service has said. And access-to-apprenticeship training is what Mr Hayes suggested would help unemployed people with few qualifications back into training.

On other points, Mr Hayes refused to give ground: "cynics and critics" were wrong about the growth in apprenticeships for under-25s. "It's bigger growth than we have ever had in apprenticeships for young people," he said, pointing to an increase of 29 per cent for under-19s and 64 per cent for the rest.

He acknowledged that this was dwarfed by the rise in older apprentices, who more than doubled in number in one year. But he said the role of apprenticeships was expanding, encompassing retraining for career changers and up-skilling the existing workforce. "What we have done is asked apprenticeships to fill a much bigger space than they have done traditionally. We are asking them to do more. We have turned them into the pivot of the skills policy."

It was not true that over-25s were often given short courses with little new learning for experienced workers, as "bourgeois left" critics alleged, Mr Hayes said. In fact, he claimed, the average course length was growing.

A report by the Institute for Public Policy Research (IPPR) and the AoC, launched at the latter's conference this week, challenges that, saying the identity of apprenticeships is under threat from over-25s. "Increasing the number of apprenticeships that are offered to people aged 25 and over has diluted the important role that they should play in socialising young people and preparing them for the world of work. Adult apprenticeships cannot exist by definition and the Government should limit them to young people," the IPPR report editors, Tony Dolphin and Tess Lanning, wrote. "People who have already been in the labour market for a number of years require other types of training."

On this issue, providers have backed Mr Hayes. The Association of Employment and Learning Providers said the over-25s were not merely getting marginal improvements to skills: more than 60 per cent were achieving their first level 2 qualification, equivalent to five good GCSEs.

AoC chief executive Martin Doel also backed over-25 apprenticeships. But the AoC acknowledges that some private providers may be milking the apprenticeship system. "It is in all quality providers' interests to try to curtail activities that undermine apprenticeships, particularly where this is being done to squeeze the public purse for a short-term profit," it said.


#163;1,500 - Grants offered to employers with fewer than 50 staff to encourage recruitment of apprentices

#163;30m - to support 20,000 new apprentices in 2012

Bureaucracy to be reduced to allow employers to advertise for apprentices within one month of deciding to hire one.

Health and safety requirements to be reduced.

All apprenticeships will have to offer English and maths up to level 2 - GCSE standard.

Increased focus on younger apprentices, new employees, higher qualifications and sectors where they make the most impact.

A review of the quality of apprenticeships by an employer, to report next year.

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