- Government outlines radical changes to boost apprenticeship numbers and drive up quality of courses
- Apprenticeship levy to level the playing field so every big company plays their part in delivering new generation of skilled apprentices and industry-led training standards to meet their needs
- All part of one nation government’s pledge to create 3 million apprenticeships by 2020
Prime Minister David Cameron will today outline a package of radical plans to increase the number of quality apprenticeships across England – from nuclear engineers to tailors and butchers – and give businesses a say on how they are run and what they offer.
Employers across the country will today (Friday) be asked for their views on the introduction of an apprenticeship levy – set to be introduced in 2017 and designed to increase investment in training and apprenticeships.
Other steps outlined today, which form part of the government’s pledge to support 3 million apprenticeships by 2020, include a requirement to take a company’s apprenticeship offer into account when awarding large government contracts and publishing new ‘industry standards’ so that apprentices have the skills that companies need.
Also today, the Transport Secretary Patrick McLoughlin announced an ambition to boost apprenticeships across the road and rail industry – pledging 30,000 apprenticeship places in the sector during the lifetime of this Parliament, with help from a transport strategy led by Terry Morgan, Chairman of Crossrail.
This builds on the 2.3 million apprenticeships created under the last Parliament to make sure that young people have the skills and expertise that employers demand.
Prime Minister David Cameron said:
The greatest asset any employer has is their workforce. And by investing in them, they are investing in the success and future of their business.
As a one nation government, we are committed to supporting 3 million quality apprenticeships over the next 5 years – to help strengthen our economy, deliver the skills that employers need and give millions more hardworking people financial security and a brighter future.
Skills Minister Nick Boles said:
Skilled people are the lifeblood of a strong economy but for too long UK businesses have invested too little in developing their employees’ skills to meet the demands of a competitive, global market. The apprenticeship levy will ensure that businesses invest in skills and training, and will act as a much needed shot in the arm for the country’s productivity.
The plans outlined today include:
The amount that UK businesses have invested in training has fallen consistently over the last 20 years and UK productivity now lags behind other major Organisation for Economic Co-operation and Development (OECD) countries.
Employers are now being urged to give their views on plans for an apprenticeship levy to boost investment in apprentices and skills training and make sure it meets their needs. Under the proposed approach employers who put in funds will have direct spending power over it.
Levy systems already operate in over 50 countries, including Netherlands, Denmark and South Korea, and will ensure every larger company plays their part in investing in the future generation of apprenticeships. The levy will help cement the government’s aim to build a world class apprenticeship system, led by employers.
A full consultation on the implementation of the levy is being launched today.
Major changes to government procurement
From 1 September 2015, all bids for government contracts worth more than £10 million must demonstrate a clear commitment to apprenticeships. In particular, employers’ bids will be reviewed in line with best practice for the number of apprentices that they expect to support. The move is aimed at widening the scope of businesses offering apprenticeships, and with more than £50 billion a year spent on government procurement contracts, will provide a significant boost in apprenticeship numbers.
‘Industry standards’ for quality apprenticeships
In the latest of a series of steps to drive up the quality of apprenticeships, 59 new apprenticeship standards developed by Trailblazer groups of employers and businesses have been approved today.
The ‘industry standards’, which cover a range of professions including nuclear engineers, fashion assistants, live event technicians, personal trainers and welders will outline the skills apprentices in these roles are expected to have to meet the needs of employers.
This is all part of government’s commitment to see through the reforms to build a world class apprenticeship system.
The first 8 trailblazers began in October 2013 and there are now over 140 Trailblazer groups that so far have collectively delivered or are in the process of delivering, over 350 standards.
The 5% Club
The 5% Club is a business-led network of employers who commit to getting at least 5% of their workforce on apprenticeships and training schemes within 5 years. The network is growing in popularity and is announcing its 100th member – Sellafield. It joins other leading employers KPMG, Vision Express, CBI and Kier which together train around 36,000 young people.
Professor Alison Wolf, Director of Public Services Policy and Management at Kings College said:
This country once had, and then lost, an excellent apprenticeship system. I am delighted that the government is introducing a levy. In my view, this is a necessary step towards recreating high quality apprenticeships across the country, based on the needs of our economy, engaging and responding to employers, and able to contribute to current and future productivity in an effective way.
Brian Lightman, General Secretary, Association of School and College Leaders (ASCL):
ASCL strongly supports the government’s commitment to increase the number of apprenticeships available to young people. We need to be doing everything we can to raise awareness about opportunities available and ensuring that young people have access to them throughout the country. The new levy has the potential to accelerate progress towards these aims. School and college leaders look forward to working with the government to ensure that it has maximum impact on the life chances of their students.
Alex Meikle, Director Employment and Skills, Electrical Contractors Association (ECA):
We recognise the pressing need for the whole of industry to get behind the drive to increase apprenticeships. Much detail remains to be worked up but we are supportive of a levy on employers and hope this will support those who currently invest to continue and incentivise those who do not engage with apprenticeships to begin to do so.
Martin Doel, Chief Executive, Association of Colleges, said:
A levy offers the prospect of delivering 3 million apprenticeships, benefitting employers, apprentices, national productivity and the nation.
Nigel Whitehead, Group Managing Director – Programmes & Support, BAE Systems, said:
As one of the largest employers of apprentices in the UK, we welcome the government’s continued commitment to encourage quality apprenticeships. We recognise the valuable contribution that apprentices make to our business, reflected by the fact that we will recruit more than 800 apprentices this year, including those we train for SMEs and companies in our supply chain. We value the opportunity to work with government to help design and implement the apprenticeship levy
Stuart Barr, Director of Stuart Barr CDR Ltd, said:
It’s good to see the government taking the bull by the horns in terms of apprenticeship training. Delivering 3 million new apprenticeships over the next 5 years is a huge challenge – collecting a levy from all large firms could help increase apprenticeship training across all business sectors.
David Marsh, Head of Academies, British Gas:
British Gas welcomes the government’s commitment to increasing the number of apprenticeships and the quality of the training they provide. At British Gas, we take investment in our future workforce extremely seriously. We are currently training more than 1,200 apprentices at our 6 dedicated academies, and look forward to working with government as it consults on the details of the proposals to ensure the best results for apprentices and for industry.
Notes to editors
- the Apprenticeship Levy consultation can be found online and will close on 2 October 2015
- it is expected to be operational by April 2017.
- the levy will be applied to larger companies across the UK. Skills is a devolved policy area, so this consultation seeks views on how the funding will be spent in England only.
- levy fund training has proved successful across the world, with levy systems in over 50 countries including Netherlands, Denmark and South Korea.
- investment in apprenticeships provide a great return for the country’s economy – the latest research indicates that for every pound invested in adult apprenticeships at Level 2 and Level 3, the country benefits £26 and £28 respectively
- under investment in skills is harming our productivity and the economy: UK GDP per hour worked is 17% lower than the average for the rest of the G7 and 30% lower than the US and Germany
Public Procurement change
- The Crown Commercial Service will publish details of changes in due course. The changes will apply to central government departments, their Executive Agencies and Non Departmental Public Bodies. The changes will take effect from 1 September 2015.
- Proposals made in any bid would be assessed and weighted alongside other elements relevant to the contract. The successful bidder will then have its agreed apprenticeship numbers written into a contract schedule which can be monitored and necessary action taken if the numbers are not met.
• Full list of newly approved apprenticeship standards (dated August 2015)