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Where will apprenticeship reforms take us in next three years?

23 March 2017

It’s easy to get caught up in the apprenticeship changes and forget to ask where it’s all heading. Even more challenging to spend time thinking about where we want them to take us and how we can influence the direction, but that’s what I aim to do here. The new levy, new system and the funding represent fundamental changes to what many of us have known for a long time. I remain positive about the levy – not just because of the new money but because it has engaged employers in new conversations and many big employers are taking apprenticeships seriously for the first time. This will help with the prestige of the brand as big employers use them and as apprentices progress to higher levels. The proposed links with the Skills Plan and technical education are right as well, if challenging to attain. It’s right too, to engage employers in setting out what they want and need for their successes and isn’t it great to have a focus, energy and effort on apprenticeships rather than the simple and single focus on higher education we have suffered from for too long. Having said all of that, we know that change on this scale is difficult and the Brexit vote undoubtedly delayed decisions, leading to some rushed implementation. I have always said that the change programme was unnecessarily risky, with everything changing all at once and the publication of the new Register of Apprenticeship Training Providers (RoATP) last week proved that with some existing good and outstanding providers and colleges unsuccessful in their applications. The uncertainties will continue as we move into the new delivery year, with investment decisions being made by 20,000 employers and a potential drop in funding for SMEs. Forecasting how all of that will pan out is more for crystal balls than it is for civil servants. There are some certainties however. As with all change programmes there will be innovation, new ideas, great things happening as well as unintended consequences, cock-ups, scams & scandals. Good employers will do great things – proper workforce development strategies, new partnerships, great opportunities for apprentices. But there will also be some cynical behaviours with employers being supported to get some of their money back. On average this will look good. Where it's good it will be very very good and where it's bad it will be horrid. Overall, the reforms will do nothing to change the essential dynamics of the labour market with its inequalities and unfairness. The levy may even amplify and reinforce them. The good news is that the target of 3 million starts will be hit, the less good news that there will be too little concern about the access issues, the mix in levels, geography and sectors, nor in the progression and productivity outcomes. More than any other certainty, maybe, is that in or around 2020 the newly elected Government will do a review led by a captain of industry asking: has the apprenticeship programme delivered what we wanted: 3 million starts; social mobility; productivity; regional economic growth; employer success. And what might that review find? My preview of its findings, my prediction, my starter for 10 looks like this: Too many Standards still about a job, not about an occupation/career; Too little progression for apprentices to higher level apprenticeships/jobs; Access to apprenticeships is still unequal/unfair, whether by ethnicity, gender, disability, where you live; Outcomes are also still unfairly based on the same issues; Skills gaps/shortages have not been filled; Apprenticeships are all too often not part of wider workforce strategy for employers; Not enough in apprenticeships in STEM; End point assessment is not working – we need proper qualifications; The market of independent training providers (ITPs) and colleges still fragile – lack of confidence to make long-term investments; and we need new reforms to make it all work better. So, if any of that, or all of it is right or likely or even possible, what can we do now to avoid it? I have five priority actions to propose: Reduce levy available to employers from 110% to say 75% to free up around £500m/yr to use as an investment fund. It could support a range of activities including access, pre-apprenticeships programme, regional funds, sector interventions, facilities, quality. Government needs to take a purposeful market-maker role. Not have procurement based on filling in a form but have a system which rewards and incentivises long-term investment, quality, progression. Work with employer bodies to encourage use of apprenticeships as part of wider workforce strategy as we exit the EU so that we can become more self-sufficient in terms of skills. Develop compelling pathways from Level 2 to 3 to 4 to 5 to 6 and beyond and aim for progression to be normal part of system, with rewards, incentives and penalties. Find ways for all of us to work together – frankly, openly, honestly, based on good metrics If we do this then we can avoid a review in 2020, or have a review which finds how much has been achieved and advises only fine-tuning to the system, rather than an overhaul. I remain optimistic. The Department for Education/Institute for Apprenticeships/Skills Funding Agency have made a good start in building the partnership we need. They clearly want to be open, work together and share intelligence with colleges & ITPs, AoC & AELP, CBI, FSB, the unions and so on. We need to engage positively because the levy, Brexit and a new Government give us a great opportunity to change culture in our labour market, address inequalities, improve productivity & help make the apprenticeship programme really world class. David Hughes is the Chief Executive of the Association of Colleges.