Some employers in the construction sector have suggested that apprentices should contribute to the cost of their own training, amid growing funding pressures.
The views are included in a report from industry bodies the Construction Industry Council (CIC) and the Construction Leadership Council (CLC), which says the levy on large employers used to fund apprenticeships needs to be reviewed to address inadequate funding levels.
In addition, the report calls for the “wholescale simplification and rationalisation” of the funding rules and regulations covering apprenticeships.
The recommendations are based on discussions involving companies, academics and professional and regulatory bodies at an event held by the University College of Estate Management (UCEM), which co-authored the report with the CIC and CLC .
The apprenticeship levy, introduced in 2017, has “driven significant investment in apprenticeships”, the report says, with funds enabling better technical and professional training and non-levy payers able to access 95 per cent of the funds needed to train their apprentices.
However, it adds that many employers are now using a full or “significant” proportion of their allocation, with others “overspent” – and complexities around transferring levy funds to other companies mean the money is “not being utilised or retained in the sector”.
The report highlights problems with apprentices who leave their programme before a final assessment, which can lead to employers and training providers being “unfairly penalised”, with “no recourse to claw back funding from apprentices”.
The report says that “some employers are questioning if apprentices themselves should invest in, or part-fund, their training, or at least be held accountable for a level of funding if they leave the apprenticeship early”.
The report says that such withdrawals “often occur” in the period between finishing a qualification and taking the end-point assessment.
Although employers in this scenario will have paid the full amount for training and assessment, 20 per cent of this sum is withheld from the training provider by the government, resulting in “significant financial losses” of up to £5,400.
More generally, the report says the amount of funding allocated for individual apprenticeships is an “even more pressing issue” than the mechanics of the levy, with rising costs “threatening the viability” of some programmes.
There has been no increase in the £27,000 upper funding limit for apprenticeships since it was set in 2017.
“There needs to be a better match between the actual costs of providing a high-quality apprenticeship and the funding allocated by government,” the report says.
The report also says that regulation of degree apprenticeships is “now disproportionate to risk and places an excessive burden on training providers”.
In addition, it calls for apprenticeships to become “more responsive and relevant” and for stakeholders to develop better-informed careers guidance that reflects the wide variety of programmes on offer.
In the report’s foreword, UCEM principal Ashley Wheaton says “the levels of funding for the delivery and assessment of apprenticeships have remained fixed” since the reform of apprenticeships a decade ago and the introduction of the apprenticeship levy in 2017.
He added that “there has been little or no consideration for hyper-inflationary price rises, particularly affecting the built-environment sector” following the Covid pandemic and the recent cost-of-living crisis.
“The result is that training and assessment cost significantly more now than they did when the level of funding for apprenticeships was set,” he said.
CLC co-chair Mark Reynolds described the report as “extremely insightful and helpful”.
“Apprenticeships are vital to our future success, and we must all support them to grow and improve our much-needed capacity, capability and productivity as we transition to a modern, efficient and green economy,” he added.
“I look forward to engaging with ministers and government officials to discuss the report, but in the meantime, I urge all stakeholders to help enhance routes into and through the industry or support the employment of an apprentice to offer them a rewarding and exciting career.”
