CMI calls on government to stand firm on Apprenticeship Levy - one year on

  • Apprenticeship Levy turns one but needs far greater support and clarity to see numbers grow in future years
  • Threats to review funding bands could undermine growing confidence in new degree apprenticeships
  • Drop in number of apprenticeships, reflects employers taking time to develop new, high-quality programmes
  • Managers back need to make apprenticeships more accessible for smaller employers - eagerly awaiting detail of £80m fund promised in Chancellor’s Spring Statement.

The Chartered Management Institute (CMI) is calling on government to provide more certainty on funding bands and much-needed clarification on its promised £80m fund to help small businesses access the Apprenticeship Levy, which turns one this week.

Chancellor Philip Hammond announced the new fund in his Spring Budget Statement in early March, but nearly a month later no details have been released on how it will work, what the money will be spent on, or how exactly it will increase small businesses engagement with the new apprenticeships.

CMI’s call on government for details follows a recent survey of more than 1,500 managers which found four in five (81%) want access to the digital apprenticeships service to be extended to small businesses to drive up apprenticeship numbers.

Small businesses are a big piece in the puzzle of how to boost the number of apprentices, and how to make the Apprenticeship Levy work for all. A year on since its launch, there have been many positive signs of how the Levy is transforming the way in which employers develop young people starting out in their careers, and upskill existing employees.

However, the current set-up certainly favours larger employers. SMEs employ nearly half of the UK’s workforce, so the government needs to get many more on-board with the apprenticeship programme if it's to hit its 3m target by 2020. We welcomed the Chancellor's £80m helping hand for small businesses to access the Apprenticeship Levy in his Spring Budget Statement, but a month on and we’re still waiting for details. Too many businesses are missing out, and will continue to do so until the government fills in the blanks.

Petra Wilton, director of strategy for the Chartered Management Institute

Recent Department for Education data has revealed a significant drop in the number of new apprenticeship starts in the past year, which is stoking concerns among managers.

According to the findings of CMI’s survey conducted for National Apprenticeship Week, nearly half (47%) believe that the government’s 2020 target of three million workers in apprenticeships will be missed.

However, support for the Apprenticeship Levy is strong, with two-thirds (63%) of managers agreeing that it’s needed to increase employer investment in skills. Many share a positive outlook, with 31% expecting to have more people starting new apprenticeship programmes over the coming year, compared to the period since April 2017. Nearly half (48%) of managers expect to see a rise in the number of new starts in the next 12 months.

Despite a slow start, we're aware that many businesses are rightly taking their time to ensure they get real benefits from investing in apprenticeships. They are selecting high-quality providers and aligning apprenticeship provision to the needs of the business. As a result, many new starts are expected in the year ahead, and the government’s decision to create a two-year window for spending the levy is clearly welcome.

However, still too many employers are not even be aware that they can use the Levy to train managers and leaders at every level. We now need more collaboration to ensure that this support from managers for apprenticeships translates into a new way of training and upskilling the workforce.

The broad scope of these new apprenticeships means that we’ll see school leavers all the way to executives embark on apprenticeships that will advance their careers and benefit their employers. The likes of the Chartered Manager Degree Apprenticeship programme is now producing its first graduates, managers with world-class skills needed to meet the business challenges of the 21st century.

Petra Wilton, director of strategy for the Chartered Management Institute

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The Chartered Management Institute (CMI) is the only chartered professional body for management and leaderships, dedicated to improving managers' skills and growing the number of qualified managers.

Our professional management qualifications span GCSE to PhD equivalents, including the unique Chartered Manager award, which increases earning potential and improves workplace performance. We have been registered as an apprentice assessment organisation by the Skills Funding Agency.

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