When is an Apprentice not an Apprentice?

The Apprenticeship Levy starts from April 2017.  It will be payable by employers at 0.5% of their pay bill.  However, with the offset allowance of £15,000 for all employers, in practice only those with a pay bill in excess of £3 million per year will pay.   The costs for a typical local authority are of course huge.  With a £100 million pay bill the levy will be £485,000.  Alongside the levy, the Enterprise Act (2016) enables the Secretary of State to set apprenticeship targets for prescribed public bodies.  This target has been mooted as the engagement of apprentices at 2.3% of the workforce.  With the unavoidable costs and probable targets to engage apprentices, local authorities must make full use of the levy funding.  But who are they going to engage?

There has been significant work to broaden the concept of “apprenticeships” from traditional trade and entry level roles.  Does, however, the inclusion of graduate and professional opportunities signal the end of junior apprentices? And will this defeat the fundamental policy aim?

Broadly, the levy must be spent, via a digital account for external training on an approved apprenticeship standard.   It cannot be spent on anything else, such as internal training or apprentice salaries, (there are exceptions to external training where an employer is a training provider subject to Ofsted inspections etc.).  Of course the lists of apprenticeship standards include, gas engineers, customer services practitioners, decorators and the like.  But it also includes solicitors, professional accountants, project managers, digital and technology professionals.  With tight budgets and some “hard to fill” professional posts the public sector will justifiably consider a broader strategy to leverage their levy pot to train for posts which are critical to business need and are known hot spots for recruitment. The opportunity to reclaim levy costs is one not to be missed.

However, inherently the public sector has a broader responsibility to support the notion that improved opportunities for the young in particular, growing your own and upskilling are fundamentally important for long term business benefit and for society and the economy generally.  Organisations need to remain committed to apprenticeships which cover a broad church and have long term commitments to trades and entry level roles. A balance should be struck which accommodates immediate shortage areas alongside traditional apprenticeship roles, ideally wrapped up in a sustaining learning and development strategy.

Apprenticeships must not become a cynical re-working for graduate recruitment, internships or professional trainees.

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