Skip to main content

Full steam ahead for apprenticeship reform

17 August 2016

There will be no delay in introducing the apprenticeship levy. This is the biggest message in last week’s apprenticeship announcements and an interesting contrast to some other projects (Hinckley power station, airport expansion, universal credit) which are being held up while new ministers carry out further reviews. The plan for the levy is to put it in place for April 2017 and to start a new funding system the following month in May. Although many of us in colleges are familiar with the outlines, it is worth taking a step back and contemplating the fact that this is a massive reform. The levy involves collecting a new £2.7 billion tax from 19,000 employers and then allowing these employers to spend the money they've paid via a new digital system. Other employers will get access to the same system in 2018. A nationwide procurement exercise in autumn will be used to set a new register of apprenticeship training providers able to access public funding from the levy and they will be funded via a new set of rules and prices. The announcement contains a large amount of detail about how this system will work including the allocation of all apprenticeships to 15 price groups and the reform of the current arrangements for supporting employers and young people under 19. College staff will need to study these rules carefully so that they can develop sustainable training models. They will also need to work through the new co-investment plans. The big change here is a requirement that all employers, apart from the smallest, must pay 10% of the agreed price. All in all it is a big overhaul and there is a risk in the short term that the complexity of the change, the parallel running of new and old systems and implied cuts in funding levels per apprentice will result in a reduction rather than expansion in numbers. This may make it harder to reach the 3 million target but that isn't the point. The longer term goal needs to be a reversal in employer spending and improving the quality of training. Rather than focusing on numbers, it might be better to spend more per apprentice and think hard about the programmes themselves. The thing not to miss in the wholesale reform of funding is the overhaul of what apprentices will learn. It's reform on all fronts and full speed ahead. Julian Gravatt is the Assistant Chief Executive of the Association of Colleges.