Thousands of apprenticeships at risk due to coronavirus crisis, providers warn

Thousands of apprentices will be unable to start or finish their programmes as the coronavirus outbreak has left many apprenticeship training providers on the brink of collapse, the sector’s representative body has warned.

More than half of providers said they had plans to downsize their operations. Picture: Adobe Stock
More than half of providers said they had plans to downsize their operations. Picture: Adobe Stock

The Association of Employment and Learning Providers (AELP) said its members were being forced to either close or mothball their operations after being left without financial support from the government.

A survey carried out last week by the association in response to the government’s announcement of a financial rescue package for public services and businesses revealed nearly 18 per cent of training providers said they were under threat of closure.

Of 279 training providers that responded to the AELP, 49 said they might be forced to close, with 79 indicating they would mothball their business and 154 reporting plans to downsize their operations.

The AELP highlighted only a few providers said they were confident about surviving long-term.

It estimates 52,000 young people and adults will lose their apprenticeships and other learning provision as a result of the predicted closures with a further 60,000 learners adversely affected by mothballing.

The association said after the Department for Education’s announcement on 23 March that funding would not be guaranteed for apprenticeship providers, its members began implementing emergency contingency plans to save their provision.

It claims the move by the DfE is in breach of new Covid-19 guidelines requiring all government departments and public bodies to pay their contracted suppliers during the coronavirus crisis.

“While the DfE has guaranteed continued funding for further education and grant-funded colleges, it has ignored the guidelines in respect of apprenticeships and other vocational skills programmes, leaving training providers on the brink of collapse,” the AELP said.

Other Whitehall departments, the Scottish and Welsh governments and the mayoral combined authorities have had “no difficulty” in informing their contract providers that they are complying, the association added.

It said MPs, at the request of their local training providers, were writing to the DfE asking why apprenticeships had been singled out.

The AELP stressed any guarantee of funding for apprenticeships did not require the DfE to request any new money from the Treasury since the programme budget for 2020-21 had already been allocated.

It said training providers were being referred to apply for help under a support package announced by the Chancellor last week to support public services and business.

Measures such as the Coronavirus Business Interruption Loan Scheme offer loans of up to £5m for small and medium-sized enterprises through the British Business Bank.

However, responses received from the survey indicate training providers feel they would not be successful in securing such loans.

One provider said: “If the revenue is stopped, then we have six weeks’ reserve capital. The business loan system requires guarantees and security. Would anyone seriously put their house on the line given the treatment of independent training providers?”

Another provider said it had already announced the layoff of 52 of its 81-strong workforce.

AELP chief executive Mark Dawe said urgent action was needed on funding apprenticeships and other skills programmes to enable this year’s school leavers and unemployed adults to have apprenticeships available to them after the coronavirus crisis had ended.

“I have asked the current DfE ministers if they want to be the ones remembered for throwing hundreds of training providers on to the scrapheap.

“All they have to do is follow the Cabinet Office guidelines and use the money already sitting in the DfE,” he said.

Dawe added that a guarantee of government funding for apprenticeships and other work-based programmes in April would allow training providers to evaluate details of how a sustainable funding model could work.

A Department for Education spokesperson said: “We recognise this is a difficult time for the sector. We are continuing to work closely with key stakeholders and the Treasury to monitor how our support packages are benefitting organisations and to consider any further action which may be required.”


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