Employers raise concerns over Government direct apprenticeship funding plans
In the consultation, put forward by the Department for Business, Innovation and Skills, 75 per cent of respondents said the proposals could have an “adverse effect on employer engagement with apprenticeships”.
The responses also showed no clear preference for the two proposed alternative methods of directing payments to employers – by deducting the Government contribution from an employer’s PAYE payment, or through an Apprenticeship Credit model, which would automatically top up an employer’s payment with a Government contribution.
However, in both cases there were concerns over additional administration and how the inclusion of compulsory employer contributions would impact on cash flow. Employers also expressed fears that direct funding would make it harder to negotiate with training providers.
In addition, respondents suggested that the Government needed to pilot the proposed model and mechanism, as well as raise further awareness among employers about the reforms.
Trailblazer extension
As an outcome of the consultation, Minister for Skills and Equalities Nick Boles said the Government would extend its ‘trailblazer’ funding pilot scheme until 2015/16.
Under the trial model, the Government pays £2 for every £1 an employer invests in its apprentice’s training. According to Boles, the programme already involves more than 1,000 employers, which together have designed 70 new apprenticeship standards and supported more than 300 new starters.
Boles said: “Giving employers direct control of apprenticeship funding remains a core and non-negotiable part of our reforms. It is central to driving the right behaviour in the system.
“However, based on the feedback to the consultation, we have concluded that further detailed design work is needed before we can reach a final decision on which funding mechanism will be taken forward to meet our shared aim of more high quality apprenticeships, where employers hold the purchasing power.”
No setback
Tim Buchanan, policy manager at People 1st, encouraged employers not to see this latest statement as a setback in terms of their input to apprenticeships.
He explained: “The new standards the trailblazer is developing provide clarity and consistency, which will not only improve retention in the industry, but will also reduce skills gaps at management level as apprentices that have come through the programmes begin to progress through the industry.”
Buchanan added: “The news that the trailblazer funding pilot will continue until 2015/16 is positive, as it provides certainty for the introduction of new standards for the senior chef and culinary arts and production programmes, as well as those currently in development – team member, commis chef and chef de partie.”
‘The Future of Apprenticeships in England: Funding Reform Technical Consultation’ is available to view at www.gov.uk.
