Funding changes put apprenticeships at risk, warn providers

The association says that government proposals to only part-fund apprenticeships for 16- to 18-year olds, with employers expected to make a cash contribution to the cost of training, will mean smaller companies are less likely to offer apprenticeship places.

Although under the government’s plans additional payments will be made to employers taking on those aged 16, 17 and 18, the AELP says this will not cover the full costs of providing English and maths tutoring delivered by training colleges.

Stewart Segal, chief executive of AELP, said the changes could have far-reaching consequences for young people who rely on vocational training to get onto the employment ladder.
 
He said: “If these proposals are implemented at a time when the Neet (not in education, employment or training) figures remain stubbornly high, we anticipate a major reduction in employers investing in apprenticeships for young people.

“The reforms will certainly not support the Prime Minister’s ambition that every young person should have the choice of going to university or starting an apprenticeship.”

The government says its reforms are being introduced to simplify the rates it pays to trainers and employers for providing work-based training for young people. The Department for Business Innovation and Skills published guidance last week outlining proposals for a tiered system of payments to be made directly to employers.

But the AELP says the system has been designed around the needs of large employers, even though small businesses provide 75 per cent of current apprenticeships.

It is not the first time the AELP has raised concerns about the funding reforms. Last September, a survey of AELP members found two-thirds of respondents thought the three options put forward by the government would not improve the current funding system.