Cuts to the top level of what employers can claim for providing apprenticeships have been branded “clear as mud”.

The funding band for the level 6 chartered manager degree apprenticeship has been cut from £27,000 - the top level - to an upper limit of £22,000. The Institute for Apprenticeships (IfA) said if the standard was being created from scratch today, its funding band would only be £8,000 based on the amount of training, the sector subject area and an allowance for end-point assessment.

Simon Ashworth, chief policy officer for the Association of Employment and Learning Providers, said employers were confused about this discrepancy, and criticised a lack of transparency from the IfA.

‘A broken manifesto commitment’

He said: “We are told that unidentified ‘ineligible costs’ were not discounted originally and so the funding band should have been £8,000 instead of £27,000. But having accepted the representations of the employers on the trailblazers that this would have made provision unviable, the ‘right’ rate should now be £22,000.

“Without full transparency, this explanation of the £14,000 difference is as clear as mud.”

He added: “The timing is very strange when the government is now saying quality is more important than quantity as the 3 million target starts to look like a broken manifesto commitment. If bands are reduced then quality will also be damaged. Let’s see the proper costings and have a rational discussion on rescuing the falling starts while protecting quality.”

‘Low level of productivity’

As well as the chartered manager apprenticeship, the level 5 operations/departmental manager apprenticeship has been also been cut - from £9,000 to £7,000 - and the level 3 team leader/supervisor apprenticeship has been cut from £5,000 to £4,500.

Adrian Anderson, chief executive of the University Vocational Awards Council, said it was “bizarre” that rather than celebrating the fact that management apprenticeships are being taken up, the IfA seems to be trying to push down their use.

He added: “Management skills are one of the main reasons for the UK’s low level of productivity in comparison to other economies.”

‘Let’s go back to basics’

Mr Anderson called for clarity about what exactly funding bands are supposed to be for.  

He added: “There is confusion about what funding bands are. Is it the maximum contribution or is it the government’s view of how much a particular apprenticeship costs to deliver?

“In many cases, the funding band doesn’t cover the delivery of the apprenticeship and employers may have to make additional contributions. There is a lot of fear about the growth of management apprenticeships. The government said employers were in the driving seat and they could spend their levy payments however they saw fit.

“I see this as meddling in the markets. Let’s go back to basics. The levy was introduced because of low levels of productivity.”

‘It would be harmful to the society’

Professor George Feiger, executive dean at Aston Business School in Birmingham, said improving management quality represents the biggest opportunity to raise productivity and living standards. 

He added: “We are confident that we can re-invent our learning and teaching approaches to be both effective and viable at the proposed funding levels. Our approach blends in person and online education.

“But a critical component remains personal interaction with tutors at many points in the learning process, so there is a limit to the fee reduction process. The fable says ‘just when we thought we had trained the donkey to work while eating less and less, he died’. It would be harmful to the society and the economy if that happened to degree apprenticeships.”