Businesses are starting to “wake up” to the opportunities the reformed apprenticeship system offers, the skills minister has said.

Speaking to Tes on the eve of National Apprenticeship Week, Anne Milton said the system reforms were “going well”. “It has been a year of a lot of upheaval for businesses and training providers, and for young people, in a way. Crucially for me, it has been about getting the system to run smoothly.”

She added: “Bearing in mind we brought in the levy, we launched the Institute for Apprenticeships and the new apprenticeship standards, this is a new environment. So it has gone quite well. That is not to say there are not things we need to change. I am really open-minded about the system. The only thing that matters to me is that the money is spent on what it is intended for.”

Last April, the government introduced the new apprenticeship levy, to be paid by all large businesses across the UK. Businesses in England can use their levy funds to invest in apprenticeship training. And although a number of sector bodies have predicted an increase in the number of apprenticeship starts, that has so far not materialised, and instead, the number has dropped dramatically since the introduction of the levy.

Apprenticeship starts

And even the most recent figures published by the government once again showed a drop. Figures for November, six months after the introduction of the new apprenticeship levy, showed a 35 per cent reduction compared to last year.

Ms Milton remains unconcerned. “We knew numbers would drop,” she said. “Interestingly, there has been a rise in degree apprenticeships. It is about letting the system bed in. It is also about letting employers understand the system and making sure they understand the opportunities that are now there for them.”

She said this particularly applied to smaller businesses, which were often unaware that co-funding for apprenticeships was available to them. National Apprenticeship Week, which starts tomorrow, was “a great opportunity to make sure we can get some more information out to employers who are thinking about and planning their workforce.”

Addressing concerns that employers were choosing to spend their levy money on a small number of high-level apprenticeships, such as degree apprenticeships in management, to ensure they spend their levy money quickly, Ms Milton said: “If you look at figures of productivity, leadership and management are really important issues. Employers spending money on degree apprenticeships is also about a skilled workforce.” She added: “There is a strong appetite among employers to grow apprenticeship numbers from level 2.” This was down to the fact apprentices were more loyal to the employer, she explained.

Providing opportunities

The introduction of standards to replace frameworks was already proving successful, said Milton. Anecdotal evidence, she said, indicated young people were much more loyal towards their employer if they were on an apprenticeship with a standard, rather than a framework. “That, to me, is about the quality of training they receive.”

Milton said she was also determined that this new system now offered opportunities to young people who “would never that they can reach higher levels.” Figures published last week showed the number of young people who are Neet (not in education, employment or training) has remained roughly the same over the last year. Apprenticeships could play an important role in tackling this, she said. “This is very important, actually. Young people and older people who are Neet are an important group and we want to do some work around that - but also around people who are in low paid unskilled work. A lot of them don’t really believe they can do anything else.”

She stressed there were also indications that both the number of black, Asian or minority ethnic apprentices and the number of apprentices with learning difficulties was starting to improve. “The trajectory is right,” said Ms Milton. She stressed the availability of appropriate careers information was absolutely key in this.

Parental influence 

“We need to present young people with all the opportunities that are out there.” Parents also played an important role in young people’s decision making, she said. “Around 80 per cent of the reason of what we do has got to do with our parents. Parental influence is huge and peer pressure is also very significant.”

Last month, a government report had indicated the funds raised through the new apprenticeship levy could be used to finance other training once the government’s target of three million apprenticeship starts by 2020 had been reached.

But Ms Milton said: “The levy was to fund apprenticeship training and endpoint assessments. We have allowed employers to transfer 10 per cent of their funds, and we need to look at the uptake of that. It is going to take time for the business world to catch on to the opportunities that are there. They are starting to wake up now to what is going on. It takes time. That is why National Apprenticeship Week is so important.”

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