alison wolf

Apprenticeship levy griping

Every Autumn statement or Budget announcement delivers a lot for newspapers to spin and economists to pore over. November’s effort introduced one new “levy” (read: tax) specifically to be used to meet the Government target of 3 million apprenticeship starts before the end of the parliament. The Apprenticeship Levy will, from April 2017 to 2020, raise £3bn by imposing a 0.5% payroll tax on companies whose annual wage bill is greater than £3m to be used exclusively to fund electronic vouchers which all companies can redeem with colleges and training providers to pay for apprenticeship training. An insight into how this may affect different industries can be found here.

The eternal cry from the business community is that the “skills gap” is a huge headwind on the strength of the economy. This 2013 document from the CBI says that,

One way to address the skills mismatch is to develop more partnership-based provision, with greater levels of business involvement in colleges and universities, as well as boosting apprenticeships

and that

It’s time to stop talking about Germany and start building a British skills system that works

So now the Chancellor has proposed a method of funding that provision. It’s by no means a comprehensive plan, there are no targets for the Levels of apprenticeships to come and many believe the entire concept of a 3 million starts target is barmy to begin with for the risk it proposes to the quality of the jobs on offer.

With this dearth of available skills from the work force you would imagine that the levy would be welcomed by the business community for the opportunity to take charge of a large pot of training funding. The Federation of Small Businesses (whose members won’t pay the levy) said, “We support the decision to use payroll as a measure to determine which businesses pay the levy, as opposed to headcount. It recognises that not all businesses will be able to afford to pay.” Larger firms (who will be paying the levy) reacted with much less warmth claiming that this, and other costs such as the forthcoming Living Wage, will hurt businesses. The CBI also weighed in, “The Apprenticeship Levy, set at 0.5%, is a significant extra payroll tax on business and by widening the net it will now catch more smaller firms.”In contrast, the IFS predicted the levy will only require contributions from 2% of firms.

To my mind, it’s hard to find much sympathy with those complaints for a number of reasons:

  1. These rises are against of backdrop of falling taxes, the Chancellor’s budget plans to lower what is already the G20s lowest corporate tax rate to 18% by 2020.
  2. The stories about the low amounts of tax paid by firms that corporation tax is meant to tempt into the country keep coming.
  3. The OBR prediction that firms will just lower wages to compensate so won’t actually feel the pinch of this new tax themselves anyway.
  4. And let’s not forget that if firms hire a 16-18 for their Apprenticeship vacancy the full training cost is met by the Government, from April 2016 they won’t have to pay NI for Apprentices under 25 and there is a lower minimum wage for this age group so there’s plenty of incentives on offer to use these routes when recruiting.

Whether or not the levy in the proposed format is the right tool in the tool kit to increase the number of high level apprenticeships on offer seems up for genuine debate. The distance the UK has to travel in this regard is stark

but business groups who bemoan that Higher Education (annual Government funding: £12.1bn) is seen as a more desirable route than Apprenticeships (annual Government funding: approx £1.4bn page 5 on the Parliamentary briefing linked above) but then also bemoan paying for an increase in spending on apprenticeships will find their protests ring a little hollow.


Checking the small print for FE College Study Programmes

A seemingly massive change to 16-19 education is due to arrive with the new term in September. The outcomes of Alison Wolf’s recommendations for students starting this stage of their education will have seen Further Education Colleges and Sixth Forms working hard over the past 12 months to finalise their plans for Study Programmes.

This will see students study an approved set of substantial qualifications, for longer hours, with options for work experience and employability skill learning and if appropriate, a continuation of English & Maths study until required levels are met.

What this will look like in reality has been illuminated by a number of case studies collected by the Association of Colleges

and some of the work here should make Careers practitioners hearts sing as it puts solid Career and Employability learning closer to the heart of this period of education.

Such fantastic work and such fundamental changes to the structure of their provision would surely be something these Colleges would be eager to promote to their potential customer base right?

Barking & Dagenham College

All students will work towards an employability qualification and, where relevant, English & Maths qualifications. All students will undertake a minimum of 36 hours work experience and complete a log of their learning activities which will be an online log from 13/14

Their prospectus

(online version on the right of the page)

makes no mention of these substantial parts of a student’s learning at all (but you get a free breakfast!).

Middlesbrough College

All students will study 34 hours of the “Skills 21” programme consisting of employability, enterprise and personal development learning. This programme will be delivered by a dedicated tutor team.

In their prospectus

some of the course pages indicate that a work placement must be undertaken as part of the course and, on page 7, there is one sentence saying “there is a strong focus on enterprise activities.”

Bolton College

Plans for all students to continue their English & Maths learning offering progression from their GCSE results. In some subject areas and for students with different qualification levels this will taught in stand alone sessions, but for others such as Level 3 students. this will be folded into the subject curriculum.

Their prospectus

clearly states on page 11 that English & Maths are part of the study programme for all students aged 16-19.

Just from these 3 examples from the case studies we can see the different approaches the FE sector has been taking to informing potential students about what they would exactly be studying should they enrol.

Those of us advising young people about their Post 16 options rely heavily on Prospectuses to inform conversations with both students and parents. The detail included in them about Study Programmes and the impact these courses will have on a potential learners experience of the College are at the nub where marketing meets IAG. I would wager that most College marketing teams are wary of including too much detail for fear of “putting off” potential applicants who would balk at the prospect of further English & Maths study or extra work on top of their chosen course and skim over it in promotion material.

Perhaps, over the next few years, Colleges will be more comfortable with how the programmes will run in practice and so more willing to sing their praises as part of their marketing efforts. In the meantime, school careers advisers will be left telling slightly skeptical learners and parents that, yes, if you don’t get your ‘C’ in your GCSE English, you will have to retake it no matter what course you do at College.

In the meantime, a vacuum of clear information leaves learners stepping into a Post 16 course which might include surprises for some of them.