Apprenticeship Levy

Lord Watson of Invergowrie Excerpts

Tuesday 28th January 2020 Lords Chamber

[Baroness Berridge]

The noble Lord raises an important point. Bringing small and medium-sized enterprises into the apprenticeship service, which is part of GOV.UK, should enable the lessening of bureaucracy and allow small employers to get hold of the training they need. The specific change will be that they will not be governed by the contracts given; they can choose exactly which provider they want to use. Then there is a simple apprenticeship agreement between the training provider, the firm and the apprentice, setting out everyone’s obligations.

[Lord Watson of Invergowrie (Lab)]

My Lords, I raised this issue with the Minister’s predecessor—without success, but we have a new year, new Minister and new Government, so let us see. Under the co-investment rule associated with the levy, the 10% that small businesses are obliged to pay towards the cost of apprenticeships dissuades many from accessing levy funds. Can the noble Baroness say whether the Government will now consider piloting the suspension of that co-investment so that small businesses can play their full part in maximising the number of apprenticeships made available?

[Baroness Berridge]

The noble Lord is trying me and I hope I will not be found wanting. The 10% co-investment fee has been reduced to 5%, which I hope will solve some of the issues. Also, if very small employers of less than 50 employees take on specific vulnerable or disadvantaged groups, such as 16 to 18 year-olds or 19 to 24 year- olds who are care leavers, the entire cost of the training is paid. They do not have to contribute anything.