Apprenticeship Levy

Carol Monaghan Excerpts

Tuesday 11th February 2020 Westminster Hall

[Carol Monaghan (Glasgow North West) (SNP)]

It is a pleasure to speak in this afternoon’s debate, Ms Nokes, and I congratulate the hon. Member for Gloucester (Richard Graham) on securing it. It is a strange one for a Scottish MP to be speaking in, because it is one of those that crosses the boundary between reserved and devolved matters—that point was clearly made by the hon. Members for Merthyr Tydfil and Rhymney (Gerald Jones) and for Dwyfor Meirionnydd (Liz Saville Roberts). There are challenges for us in Scotland as well. In Scotland, our businesses must pay the apprenticeship levy, but they are not tied to the same restrictions in terms of how apprenticeships are delivered.

A strong economy with growing, competitive and innovative businesses is essential to supporting jobs and our quality of life. To achieve that, we must prioritise education, from early years into employment. There is a real need for young people to train for work, be that through further education, higher education or apprenticeships. The hon. Member for Strangford (Jim Shannon) set out clearly the importance of that education process, whatever it may be. The best situation is one where all the options have equal status. The hon. Member for Gloucester talked about the importance and value of apprenticeships, with which all of us here this afternoon would agree. Unfortunately, in many circles, apprenticeships are still considered second best.

The right hon. Member for Harlow (Robert Halfon) talked about the possibility of a further education UCAS option, which deserves further investigation. The hon. Member for Stoke-on-Trent Central (Jo Gideon) talked about the great work done in Staffordshire University with apprenticeship programmes. Although many still prioritise the number of young people accessing university, other life choices are not given the place they deserve. We should not be talking about the route that our young people take, but about their positive destinations. The hon. Member for Henley (John Howell) talked about social mobility, which sums it up nicely. How do we make our young people mobile? Not everyone takes the same route.

It is important that we recognise what apprenticeships should and should not be. The right hon. Member for East Hampshire (Damian Hinds) talked about some responsible employers and the excellent programmes they provide for the apprentices in their care, but that is not always the case. Apprenticeships should not be used by employers to attract funding without producing positive outcomes. They should not be used to plug temporary employment gaps. They should be used when the apprenticeship can lead to a full-time position, and apprenticeships should always be matched to skill shortages.

Since the introduction of the apprenticeship levy, we have seen a drop in the number of apprenticeships in England. The hon. Member for Gloucester talked about the levy as a tax. One third of businesses reportedly view the apprenticeship levy primarily as a tax, without training benefits. The British Retail Consortium has said that the levy is “failing retailers”. It appears that it is a clumsy tool that is not doing everything it should be.

Despite that, we in Scotland are making excellent progress to ensure that young people have the skills that they need to exploit current and future opportunities. We have had discussions with key stakeholders and have established a national retraining partnership, with the aim of helping workers and businesses prepare for future changes in their markets by enabling the workforce to upskill and retrain where necessary. The commitment to skills is ambitious, building on a number of initiatives already in place to boost employment and create positive pathways for young people.

Of course, the UK Government are stepping on a devolved responsibility here. We pay the levy, but the training is devolved. The Scottish Government have worked with employers to mitigate this unwelcome tax. They have extended the £10 million flexible workforce development fund to continue to support investment in skills and training. Employers have been encouraged to link with colleges to learn more about the opportunities available to them. All that work is paying dividends. The Scottish Government have exceeded their apprenticeship target every year for the last eight years. Skills Development Scotland statistics also show that the Scottish Government’s commitment to increasing apprenticeships to 30,000 by 2020 is on course to be met.

The right hon. Member for Harlow talked about degree apprenticeships. The apprenticeships currently on offer in Scotland include, this year, around 900 graduate opportunities, up from only 278 in the previous year. Massive steps have been made in that area. Some 93% of Scotland’s young people now go on to positive destinations—that is the highest of anywhere in the UK. We will continue to enhance the apprenticeship opportunities available to provide the right balance of skills to meet the needs of employers, including prioritising higher skilled apprenticeships and STEM—science, technology, engineering and maths—occupations.

As an example, an Edinburgh school is teaching construction skills. The infrastructure company Balfour Beatty is co-funding that project with the University of Edinburgh. It aims to inspire the next generation of specialists in engineering and the built environment. Pupils at Castlebrae Community High School in Craigmillar take subjects including maths, science and technology, while learning about the latest practices demanded in construction. The pupils acquire real-world, practical experience and employability skills as part of the course, which brings industry professionals into the classroom to support teachers.

Young people have to know that there is no wrong path, and #NoWrongPath trends every year roundabout exam results time, to show young people that there are many routes into employment and on to a positive destination. We all need to ask ourselves whether we would be happy for our own children to take each of the different routes into employment. If the answer is no, we have to question why we are here.