More “tough decisions” are coming for businesses. Last week, at the Apprenticeship and Training Conference in Liverpool, the Skills Minister began letting employers down gently on Labour’s opposition pledge to offer more flexibility when using the apprenticeship levy. As we approach the June spending round, there just isn't enough money to go around. Who'd have thought it? It shouldn't come as a surprise to learn that 99% of the apprenticeship budget was spent in 2023/24, leaving very little headroom to fund other skills training. We wrote a report on this last year at Edge. We’ve seen sustained and welcome policy efforts to maximise apprenticeship spending, including the expansion of the levy transfer allowance to 50%. And back in November 2023, the DfE’s own modelling suggested we would need additional investment to cover the original, more generous plans to allow businesses to spend up to 50% of their levy on other skills training. To the tune of £1.5 billion a year.
This is all starting to look a bit tricky for Skills England, with the Minister's latest comments coming in a week where the efficacy of the civil service and Government quangos came under fire. Skills England now has the unenviable task of “unifying” stakeholders in the skills system, including slighted employers. But focusing on Foundation Apprenticeships alone won’t cut it when it comes to the scale of the skills challenges - laid out so starkly in Skills England’s first report. Looking back, the ‘mandate’ for a broader Growth and Skills levy was based on large employer-reported difficulties with spending the levy, difficulties including problems with admin, a lack of understanding of skills needs and a lack of time to invest in training (see, for example, this report). We’re in a different place now and policy levers outside the levy – like “removing bureaucracy” and helping smaller businesses to access apprenticeships through local brokerage services (as we recommended) might go further in achieving the Prime Minister’s aim of rebalancing the apprenticeship system to focus on younger people, without causing upset.
With the skills training offer now a prime focus for civil servants working on the delayed post-16 skills white paper and the Education Select Committee through their FE and Skills inquiry, there’s a lot the Government can learn. Perhaps the role for national intervention may lie not in blunt policy levers, but in facilitating more of what is already working at a local level.
Our regular series of Skills Shortages Bulletins (see below) highlights initiatives that are turning data into action on skills gaps. Just recently at Edge we’ve seen and supported examples of local leaders taking the initiative to provide high-quality, joined-up skills training that's helping to grow key priority sectors. These are the voices to take heed of.
- In Milton Keynes, Oracle Red Bull Racing are working with Milton Keynes College to design and deliver the STEMx programme, a careers programme starting as early as primary school to open up access to STEM courses, leading to skilled jobs in F1 and motorsport.
- In Greater Manchester, 32 schools are currently piloting new approaches (in collaboration with the GMCA, leading employers and community organisations) to improve pathways to high-quality jobs in seven in-demand sectors across the region under the ‘MBacc’.
- In Sheffield, the Advanced Manufacturing Training Centre neatly maps (not duplicates) their Level 3+ provision, with modules co-designed with employers to ensure the training is fully preparing young people for jobs in this fast-moving industry.