Billions raised for apprenticeships gone UNSPENT sparking calls for for reform
A tough-hitting report endorsed by three former schooling secretaries claims that billions raised by the Apprenticeship Levy has gone unspent.
Leading suppose tank Policy Exchange says that £4.3billion raised by the levy since 2018 has not been spent on apprenticeships.
It is looking for motion to assist employers spend money on coaching in areas the place there are shortages of abilities so the nation doesn’t need to depend on imported labour.
Just 349,190 individuals began an apprenticeship in 2021-22 – down from a excessive level of greater than half 1,000,000 a 12 months within the pre-pandemic period.
Ex-education secretaries David Blunkett, Nadhim Zahawi and Sir Gavin Williamson have backed the report, which exhibits how medium-sized companies are fighting the paperwork of the coaching system.
There can also be concern that many individuals can’t afford to start out an apprenticeship as a result of pay charges for the primary 12 months are sometimes far beneath the minimal wage.
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A 21-year-old in work can be entitled to a minimal wage of £10.18 an hour. But within the first 12 months of an apprenticeship she or he can be paid simply £5.28 an hour.
Researchers discovered the variety of 19 to 24 year-olds beginning an apprenticeship has fallen by 31 p.c since 2015-16. Policy Exchange desires “all apprenticeships to be paid the National Minimum Wage for their age, to enable those from lower-income households to take up apprenticeship opportunities”.
The report requires levy payers to have the ability to help shorter and extra versatile coaching alternatives, akin to HGV programs or “coding bootcamps”. The suppose tank additionally requires an finish to the “grave injustice where child benefit is stripped from the parents of 16-19 year-old apprentices – when they would continue receiving it if the child was studying A-Levels at school or college”.
Cobra beer founder Lord Bilimoria stated companies had been “crying out” for the Government to reform a system which had didn’t ship the apprenticeships wanted to spice up Britain’s productiveness.
Conservative MP Mr Zahawi backed the push for reform, saying that “employers should be able to use the levy to train up home-grown talent – including on shorter and more flexible courses – instead of being forced to rely on immigration to fill these vacancies”.
Tina McKenzie of the Federation of Small Businesses described the “sharp decline” in apprenticeship begins as “alarming,” warning: “We should not jeopardise the future of our economy by neglecting the skills and experiences of our youth.”
David Hughes, chief govt of the Association of Colleges, added: “The apprenticeship levy has had a positive impact in many ways, but it is not working how it should. A reformed levy system is vital as soon as possible.”
Lord Austin, a former Labour communities minister, stated: “A fairer minimum wage, free transport for young apprentices and ending the travesty whereby child benefit is removed from the parents of apprentices under 18 would make a real difference to those from poorer backgrounds.”
Setting out what’s at stake for the nation, Lord Blunkett stated: “It is self-evident that we cannot achieve the goals of increased growth, sustainable economic development in all parts of the country and reverse the decline in productivity without the skills and training required to meet these challenges.”
A division for schooling spokesman stated: “Thousands of employers are making good use of their levy funds, helping to grow the economy by creating hundreds of apprenticeships opportunities for people of all ages and backgrounds, with under-25s accounting for more than 50 percent of all apprenticeships starts.
“The apprenticeship levy has helped grow the apprenticeship budget to £2.7billion a year by 2024-25 – supporting employers of all sizes and in all sectors to benefit from the high-quality training that apprenticeships offer. In the 2021-22 financial year, 99.6 percent of the apprenticeship budget was spent.”