The Apprenticeship Levy two years on

The NAO report, The Apprenticeships Programme, reviewed the progress made on apprenticeships since 2016. Alongside concerns raised about the long-term financial sustainability of the programme, due to employers selecting more expensive apprenticeship standards than predicted, the Audit Office also questioned the value for money of the scheme. The report highlighted that some employers were converting their graduate trainee and professional development programmes into apprenticeships, casting doubts on the added value to the economy, as such training would have been provided in the absence of government funding.

These findings echoed those of Ofsted’s earlier report, where they warned that they were '…concerned that in many cases, levy money is not being spent in the intended way. We have seen examples where existing graduate schemes are in essence being rebadged as apprenticeships'. As well as rebadged existing training schemes, they also raised concerns that some providers were simply accrediting existing skills of apprentices and reported ongoing problems with the quality of teaching, the amount of time provided for off-the-job training, and issues of poor governance, amongst some providers.

While the increase in higher-level apprenticeships is a welcome shift, extensive rebadging of graduate, professional and management training into apprenticeships risks both undermining the added value of the programme as well as access to apprenticeships for lower skilled and younger individuals.

In our report, Assessing the Early Impact of the Apprenticeship Levy, we raised concerns regarding the use of apprenticeship funding for generic leadership and management training – our survey of employers found that more than a third were looking to use their levy pot in this way. Analysis of apprenticeship starts since the reforms were put into place clearly shows that our concerns were justified: the team leader/supervisor had the most starts of any standard for 2017/18, and together with four other management apprenticeships made up a total of 17% of all apprenticeship starts last year.

While recognising that these represent an effort to plug an important UK skills gap, non-sector specific apprenticeships in generic skills areas, such as management training, are a new introduction, and as such we have recommended that there were closely monitored to ensure that they are more than just professional training.

Going forward it is clear that we need to have a serious rethink of the apprenticeship levy – so that it really does drive up overall investment training - as well as the wider apprenticeship system/what should be counted as an apprenticeship, to ensure that both are delivering for UK economy and generating the outcomes that we need for individuals, organisations and society.