UK spending review must prioritise apprenticeships and skills, says CIPD

This National Apprenticeship Week, the CIPD is calling on the UK Government to fast-track consultations with employers and the people profession on the design of the Growth and Skills Levy.  

In our submission for the Spending Review, our public policy experts have urged the government to direct public spending towards apprenticeships and skills development, including an Apprenticeship Guarantee for all young people aged 16-24.  
 
The people profession’s insights will be key to ensuring the Growth and Skills Levy delivers on its promise to tackle skills deficit and ensure the workforce is equipped to deliver the government’s industrial strategy and growth ambitions. And early consultation with a range of stakeholders will be crucial to help determine how much levy funding should be available for individual employers and how much should be allocated to tackle sector-based or regional skills deficits.  

An Apprenticeship Guarantee for 16-24-year-olds  

We’re also calling on the government to introduce an Apprenticeship Guarantee that will give all 16-24-year-olds access to either a level 2 or level 3 apprenticeship. Current plans for a Youth Guarantee promising support to find employment, training or apprenticeships for 18-21-year-olds will not be sufficient to address the collapse in apprenticeship provision for young people or tackle rising youth unemployment. 

We want to see:  

• A £3,000 hiring incentive per apprentice for SMEs, to help reverse the decline in apprenticeship starts among small firms and unlock apprenticeship opportunities for young people  

• The development of a ‘pathway’ to apprenticeships through a refreshed pre-apprenticeship programme 

Funding for work experience for secondary school pupils, and better HR support for SMEs 

We’ve also submitted proposals for the government to allocate £75m in funding to help schools work with employers to deliver the proposed two-week work experience placement for secondary school pupils. 

And we’ve renewed our call for the government to invest in better HR and people development support for SMEs, so organisations are better equipped to develop the skills of their workforces.   

Training to support AI adoption 

With AI adoption set to accelerate, we’re also calling for a closer links between policies on innovation, skills and business support, to ensure that workers and organisations have the right skills and capabilities to implement AI effectively and responsively. The provision of vocational training and technical qualifications, including apprenticeships, must be a part of this.  

Reforms could help improve uptake, but shorter apprenticeships could pose a reputational risk

We welcome the government's recent announcement around the relaxation of the rules for functional skills. The changes mean that employers can now decide if apprentices aged 19 and over need to sit a Level 2 English and Maths qualification to complete their apprenticeships. This should improve uptake and completions, particularly for disadvantaged groups. But, the government will need to monitor this closely to ensure that they don't further prevent younger apprentices from accessing opportunities.

The government has also announced that it will reduce the minimum duration for apprenticeships from 12 months to 8 months, trialed initially in three key shortage occupations - this is due to come into effect in August 2025, subject to the legislative timetable. In December 2024, we hosted a roundtable with the Department for Education to give CIPD members working in skills and apprenticeships roles the opportunity to feed into reforms to apprenticeships policy. Feedback from this session highlighted that such a move could present a real risk to the apprenticeship brand if shorter apprenticeships become more wide spread. Research shows that the UK is already an international outlier in terms of apprenticeship duration - in most other countries, two years or longer is the norm.