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Why we need a Skills Levy not an Apprenticeship Levy

FSB member David Broadhead reports back on an open forum he arranged on apprenticeships he attended and suggests possible ways forward.

The UK has a critical skills shortage and subsequent productivity problem. The apprenticeship levy was introduced in May 2017 as the headline solution to overcoming this long-term skills crisis.

By late Summer as further practical details emerged, informed opinion and anecdotal evidence suggested that this might not work out as planned and might actually be counterproductive. Physical evidence has very recently emerged demonstrating this through the 59% reduced uptake of apprenticeships since its introduction.

Prior to this, a Commons education and business select committee, the British Chambers of Commerce and the Institute for Fiscal Studies had all expressed various concerns about the levy.

Given growing concerns, in early October I arranged an open forum discussion event to be held at The Media Centre in Huddersfield on November 17 2017.

The title of the forum, ‘Has the apprenticeship levy damaged learning and development’, was deliberately provocative, but we believed the levy has significantly disrupted the learning and development strategy in a large number of organisations and we wanted to substantiate this.

It was concluded that the current apprenticeship scheme solution was unlikely to rectify the critical skills crisis and productivity problem.

Whilst having honest intent and being extremely beneficial in a lot of cases, what should be considered is a more open approach to funding shorter, innovative, demand driven, less onerous but more focussed immediate training solutions.

Maybe allocating 50% of levy funds to a much administratively simpler skills system, perhaps run through LEP’s, with quality regulated by awarding/industry bodies, might be a more appropriate solution and generate the more immediate improvements the UK desperately needs.