The government needs to invest £750 million to boost apprenticeships in small- and medium-sized enterprises (SMEs), the chief executive of the Institute for Apprenticeships and Technical Education has said.

Jennifer Coupland, who joined the institute from the Department for Education in November, told the Financial Times that the apprenticeship levy had created a divide between employers who can and cannot afford to fund apprenticeships. 

“It is time for the government to lean in more to support small- and medium-sized businesses, to plug that gap,” she said, adding that public money was needed to restore the balance of apprenticeships between small and large employers. 

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She told the Financial Times that additional funding was needed for 85,000 more apprenticeships.  A report published in October by the Learning and Work Institute called on the government to provide additional funding to prevent the loss of up to 75,000 apprenticeships at SMEs.

Apprenticeship levy under fire

The apprenticeship levy has come in for criticism in recent months. The Labour and Liberal Democrat general election manifestos pledged to reform it, while the Conservatives vowed to look at "how we can improve the working of the apprenticeship levy”.

SMEs with a payroll of less than £3 million a year do not contribute towards the levy  – but rely on unspent funds from large employers to fund their apprenticeships.

Ms Coupland also pointed out that small businesses had cut their on-the-job training by 10 per cent. Companies have come under fire for using their levy to train already-skilled managers and workers.

However, the Financial Times said that Ms Coupland defended the use of the levy money to fund higher-level apprenticeships, saying: “We’re an employer-led organisation, we want to give employers what they need out of the apprenticeship programme.”