Tony Howard, BESA's director of training.
From July, large firms who pay the Levy will be able to transfer up to 10 per cent of their funds annually to multiple supply chain partners. Previously, a levy-payer was only able to share funds with one other employer, but apprenticeships and skills minister Anne Milton has relaxed that rule in the face of concerted pressure from industry.
“This is great news,” said director of BESA Training, Tony Howard. “It is something we have been fighting for since the Levy started last year and was originally supposed to start in April. Sharing the funding in this way will allow many more SMEs to invest in apprentices.”
Only around two per cent of employers actually pay into the Levy – those with annual payrolls of £3m and above – but the estimated annual pot of £3bn is intended to be used by all employers to subsidise apprentice recruitment and training. However, there has been considerable confusion about how non-levy paying firms could gain access to the money.
The government intended the Levy to play a key role in its plans to deliver three million new apprenticeships by 2020, but figures released by the Department for Education earlier this year revealed a 28 per cent drop in new apprentice starts since its launch.
Confusion
“The fall in numbers was no surprise because there was total confusion about where the levy money was going,” said Mr Howard. “The principal behind the Levy is sound, but small employers were struggling to access funds for specialist training provision – as opposed to the mainstream plumbing and electrical provision that was being offered to them by the further education sector. Also, many large companies were not using the full amount they paid in.
“This decision is another step towards giving employers real flexibility because they will have the power of the fund to choose the provision they want. This should result in a steady rise in apprentice numbers over the next few years,” he added.
By making a transfer to pay for an apprentice’s training and assessment, larger firms can support companies which may not have considered hiring an apprentice before, or could not get the specialist provision they wanted. However, BESA also pointed out that funding needed to be directed towards training providers capable of delivering the New Standard apprenticeship courses, which have been developed ‘by employers, for employers’.
“There is huge appetite out there to take on apprentices,” said Mr Howard. “At BESA Training, we have seen a record number of enquiries from companies of all sizes wanting apprentices. We have also seen a 27 per cent increase in new apprentices signing up for our New Standard courses.
“The difficulty for building services employers has been finding providers in their area able to deliver the training. Many specialist courses were closed years ago because of a drop in demand after the financial crash or because providers cherry-picked the apprenticeships that they wanted to deliver,” he added. “However, this new stream of funding brings fresh hope.”
As well as creating a series of New Standard apprenticeships, BESA and its members have revamped ‘end point assessment’ of candidates to make it more meaningful for employers by focusing on life-long learning.
“The system now provides real evidence that the apprentice has the knowledge, skills and behaviours to operate as part of a modern workforce,” explained Mr Howard. “This is what employers have been calling for and, by making the Levy funding system more flexible, the minister has increased the chances of smaller employers being able to support candidates through this training.”
The new end point assessment process involves a series of interviews, practical tasks and questions where students are examined, independent of their training provider. This should convince employers that they are receiving apprentices with fully rounded competencies, ready for productive work.
Many employers have already signalled to BESA that they put greater value on continuous feedback – not necessarily assessment to monitor progress and reinforce learning – followed by the end point assessment, rather than the old system of formal ‘on programme’ qualifications.
“Employers are less concerned about apprentices achieving a series of formal qualifications, but on being able to easily update their skills on a regular basis in line with changing market demands and new technologies,” said Mr Howard.
He explained that one of the government’s fundamental principles is that the new apprenticeships – with their end point assessment – should become a new style of ‘flexible qualification’ fit for the modern workplace.