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Does the Apprenticeship Levy need refocusing?

30/03/2017

With the Apprenticeship Levy coming into force next week on the 6th April, the Association of Accounting Technicians have suggested that it needs refocusing before it can be truly effective.

Does the Apprenticeship Levy need refocusing?

Adam Harper, Director of Strategy and Professional Standards at the Association of Accounting Technicians (AAT) has commented on the introduction of the levy, stating that he feels that the measures do not go far enough to address the issues of chronic underinvestment in skills. 

Whilst pointing out that the AAT has always been in favour of adding new apprenticeships, Harper goes on to point out that this does not matter if the completion rates for these apprenticeships are not reaching the required levels - as it simply shows more people are starting apprenticeships without completing them and gaining the required skills. 

Harper's comments can be read in full below. 

"There is little point in having a target for the number of people starting an apprenticeship if many don’t finish. Most sectors have enviable completion rates, for example of the thousands of students taking an AAT apprenticeship each year, over 90% complete their course. However, official statistics show that nationally more than a third of all apprentices fail to complete their apprenticeship.  

"This compares to just 6% who drop out of higher education in the UK each year. Likewise, what is the point in undertaking an apprenticeship if it either holds little real value in the eyes of some employers or provides too little by way of transferable skills and knowledge for the individual?  Unfortunately, in a small but still significant number of instances, this remains the case.

"In time, AAT would like to see the Apprenticeship Levy renamed as theSkills Levy and for levy monies to be able to be spent on high quality traineeships and other forms of training that will benefit individuals, employers and the economy as a whole.

"We are not alone in thinking this would improve matters. AAT recently surveyed MPs across all parties on this issue and found that 65% support our suggestion that the levy should be developed to allow funding for skills other than apprenticeships.

"Increasing the flexibility of the levy would foster improved productivity across the whole workforce, deliver greater value for money and yet have no significant revenue implications for the taxpayer. It might also help encourage more small and medium-sized businesses (SMEs) to take on apprentices. Given that 99% of businesses in the UK are classed as SMEs, this provides a significant pool from which to drive up apprenticeship numbers.

"Luckily businesses across the UK are now starting to wake up to the power of apprenticeships.  In our recent ‘Getting ahead for accelerated ambitions’ study, we found that almost half (48%) of UK businesses surveyed have taken on apprentices in the last five years, highlighting that apprenticeships can act as a catalyst for young people to get a foot on the employment ladder.  

"Over half (51%) of employers that have taken on candidates who have completed an apprenticeship confirmed that apprentices have generally performed better than those with a university degree.  For many employers, degree level qualifications are now less important than the right attitude and relevant work experience. 

"The future looks bright, but we need to ensure that any reforms are fit for purpose to make the future even brighter for the next generation."

by Jack J Collins, Editor of AllAboutLaw.co.uk