‘Employers aren’t angels, but it’s not all about greed’

18th March 2016 at 12:00
Not all businesses are motivated solely by money on apprenticeships, despite what the sector might think

Some 20 years ago, the Financial Times published a cartoon that showed a man with a sign round his neck saying “Will work for food” and a rotund businessman asking him “How much food?”

It’s a viewpoint that is sadly all too common in FE: that business people care only about their own narrowly defined self-interest and that they will work hard to find ways around rules designed to push them into more acceptable behaviour, such as the new apprenticeship levy.

But that’s not the reality I see. And with businesses in the driving seat on apprenticeship reforms in England, it’s important to show the other side of the coin.

I have recently been advising a large maritime business on the apprenticeship paper that it was preparing for its board. Unquestionably, the board commissioned the paper because of the levy, but that’s good news, isn’t it?

If the government had set out to get every company board to put apprenticeships on its agenda, there would have been plenty of critics telling them that it couldn’t be done, so what a prize if the levy pushes many more to do so.

Compelling arithmetic

The arithmetic for this particular company is compelling: it will have to pay a levy of more than £500,000 a year. Any board would take notice of that. Chancellor George Osborne is fond of saying that the levy is an unusual tax in that you can get it back, so any board will obviously ask how that can be done.

But not at any price. If the only motivation was to “get its money back”, this company would not hesitate to turn its in-house high-level apprenticeship into a statutory, government-funded apprenticeship.

The company did hesitate, though: money isn’t everything. I’ve worked with at least as many companies over the years that fear entanglement with government as those that want to get their noses in the trough. This one knows well that government money comes with strings and wants to think through what it would have to give up in exchange.

It is worried about losing its intellectual property if it joins the government system: would all of its competitors get to see that fat file of training materials it has compiled, developed at the firm’s own expense? As each apprentice costs more than £100,000 to train, the company’s concerns are far from trivial.

I’ve reassured the firm that the Trailblazer process focuses on outcomes – the standard to be achieved – so businesses needn’t worry about giving away their intellectual property. It has decided to take the plunge by committing to converting its in-house programme into a statutory apprenticeship.

That’s a good win for UK plc. The levy has prompted this innovative business to work with its competitors to make a new apprenticeship openly available, and a higher-level one at that. If I worked at the Department for Business, Innovation and Skills, I’d chalk that one up as a success for its policy.

The board paper also took stock of the range of apprenticeship activity across the business, with numbers, and explained the rationale for current activity. What HR director wouldn’t relish the opportunity to have their board asking why there are so many apprentices in one part of the business and none in another?

'Unanswered questions'

There are plenty of unanswered questions on apprenticeship policy, but while politicians and commentators debate, companies must plan. A key gap for this company is what happens outside England. It has operations across Britain, so it needs to know how the devolved administrations will manage the levy. Will they, for example, restrict the fund to apprenticeships (as in England) or open it up to other training?

The Treasury has said that the devolved administrations will get their “fair share” of the levy pot, but has not yet translated that into something countable, so the political wrangling goes on with no end in sight. That’s unhelpful when employers are trying to plan.

The maritime sector takes training seriously because of the risks involved in so much of the work, but I doubt if the example I’ve quoted is out of line with how other employers are responding to the levy. Employers aren’t all angels, but it’s not all about greed either.

Iain Mackinnon is secretary to the Maritime Skills Alliance, but writes in a personal capacity. He tweets @IainAMackinnon


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