Apprenticeships: Government Support

Philip Hollobone Excerpts

Tuesday 24th January 2023 Westminster Hall

[Karin Smyth]

I agree that degree apprenticeships have their place, but that is not what the levy was for. As I have heard regularly in the debates I have attended in the seven years for which I have been in this place, our concern is for the small and medium-sized enterprises in our constituencies that are finding the subject really difficult to navigate. My constituents, who are among the least likely in the country to go to university, need level 2 and level 3 apprenticeships to help them up the ladder—I am particularly keen on the ladder. I do not want to throw any babies out with any bathwater—I am not sure where the bathwater and the baby come into the debate—but we cannot lose one for the sight of another, and a Government who were ambitious for apprenticeships would be able to do both. The implementation of lower-level apprenticeships has just been too slow. In my constituency, they are often for people who have been let down by the education system and who need to reach the first rung on the ladder.

We have had some other things that I have tried to support, such as the kickstart campaign—I do not know what has happened to that—and I am looking forward to seeing the results of the fire it up campaign. The Minister will know that I try to support all schemes, regardless of party politics. I want whatever works, and I will try to make anything work. We need to turn the tide on the catalogue of failures that have become so synonymous with the Government’s strategies for apprenticeships. I am not overly confident, but I am hopeful that we can do something better. I am obviously more hopeful about the next Labour Government, and I am sure my hon. Friend the Member for Chesterfield will outline our approach.

We cannot level up without skilling up. Transforming the failed apprenticeship levy and creating what we have called a growth and skills levy will give businesses the flexibility they need to train their workforce and create opportunities that will drive growth across every region of our country and in every sector of our economy. I am sure my hon. Friend would not mind if the Government stole that idea—they can crack on with that if they would like to. We want to unlock Britain’s potential, and people need a solid foundation in education and a chance to succeed to do that.

Having security at work and investing in apprenticeships and training opportunities enables people who want the chance to reskill, all of which will help people into high-quality jobs. What we talk about as a green prosperity plan—again, pinch it—will create a million good jobs in industries and businesses in all parts of the country, underpinned by new apprenticeships in the technology sector that will be vital in meeting our net zero commitments. That is the new building in my constituency that the Minister came to see. That is what we want to be looking at: the jobs of the future.

It is clear that the potential for improving our apprenticeship system in the UK is huge. I continue to hope that is the case. I hope that through the debate, apprenticeships are given the prominence they deserve and the help they need, and I hope the Minister will use his time to confirm that even as the eighth Minister at the tail end of a Government fast running out of ideas and time, he will ensure a proper focus on skills and apprenticeships within the Government to ensure our country and our economy have the skills for the future.

Can the Minister outline the immediate actions he and his officials will take to drastically improve the quality of apprenticeships and curb that terrible drop-out rate? I sincerely wish to hear how the long-awaited review of the levy is going and what actions the Government will take. I am sure he will agree, as the former Chair of the Select Committee, that more funding is needed for supported apprenticeships and special educational needs and disabilities. Perhaps he can use his appearance today to surprise us all. Given his personal support for degree apprenticeships, can he outline what the Government will do to ensure faster implementation of the programme? Finally, it would make me very happy if the Minister were to announce, here and now, the use of apprenticeships to increase the NHS workforce.

The legacy of the Government is not good. Amidst the wreckage, good ideas remain and with good people like the Minister, who have a genuine belief in the transformative nature of apprenticeships, I hope we can move forward so that no other young person has their future scuppered for, frankly, no good reason.

[Mr Philip Hollobone (in the Chair)]

The debate can last until 5.30 pm. There are seven Members standing, six of whom have had the courtesy to inform the Chair that they wish to speak. To get everybody in, there will be a time limit of three and a half minutes with no interventions.

[Jonathan Gullis (Stoke-on-Trent North) (Con)]

It is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate the hon. Member for Bristol South (Karin Smyth) on securing this important debate.

I am proud to stand here as the co-chair of the all-party parliamentary group on apprenticeships. I am even prouder to stand here and say that I am the employer of not one, but two fantastic apprentices in Stoke-on-Trent North, Kidsgrove and Talke. Jess is about to sit her exams—only next month. I will not wish her the best of luck because I always believe that if someone does the hard work, they will pass the test. She has certainly done the work, so I am sure the test will go through. Then Mya will start with me on 1 February. Jess was 17 years old and Mya is 18 years old. This is a fantastic opportunity for young people to get that important level 3 qualification when they did not feel college was the right option and wanted to earn and learn.

I cannot agree more with the hon. Member for Bristol South on the point about the fact that although degree apprenticeships are important, we also need that ladder of opportunity—I know the Minister was keen on that phrase when I served with him on the Education Select Committee—and we need to offer those level 2 and 3 opportunities, particularly in areas of deprivation where there are people who may not have a formal qualification. In Stoke-on-Trent North, 12% of my workforce do not have any qualifications at all, which is 8% higher than the national average. Level 2 is the first rung on that ladder.

We should do everything we can to accelerate all the way up degree apprenticeships, but we have to build people’s confidence and self-esteem and build people up with the skills to go through the courses at the different stages so they are equipped and ready. It is a bit like when I was in teaching, with the grandmother effect: it is all very well making sure we are supportive and help in every way we can, but if we undermine that process, that could be a problem.

In Stoke-on-Trent North, Kidsgrove and Talke we have had 13,240 apprenticeships start up since May 2020. I want to congratulate Stoke-on-Trent College for its fantastic work. I partner with the college when it comes to my apprentices. It will also deliver T-levels from the start of this year, alongside the City of Stoke-on-Trent Sixth Form College, which was an early up-taker of the digital T-levels that began in 2020, with 55 students to date.

Ultimately, there are things that need to happen. We have seen that drop in level 2 take-up, which some recent reports suggest is at 60%—the last was from March 2021. We need to address and work with our local colleges on that. I am delighted that we will see Ofsted inspecting training providers and holding them accountable for the quality of training. EDSK said that the lack of quality training throughout their apprenticeship forces out half of those who drop out. We need to make sure that employers are being held accountable for their work.

When I see £3.3 billion in the levy pot being returned to Treasury, it does not half make me shudder. That £3.3 billion could be invested not just in young people but in older people as well, and not only in upskilling the current workforce, as my hon. Friend the Member for South Ribble (Katherine Fletcher) pointed out, but in making sure young people get that opportunity too.

We need much more flexibility with the levy pot. I am not asking to simply open it up, but for us to allow employers to use a small percentage of it to invest in mileage, training or administrative staff to undertake what can be a bureaucratic process, and for an amount to be ringfenced specifically for young people. Apprenticeships are the best way to level up our great country, and I hope to see how the Government will develop them to make that happen.

[Mr Philip Hollobone (in the Chair)]

I will call Jim Shannon, who has kindly informed me that he will take an intervention. By law, the time limit has to increase by a minute, so could the hon. Gentleman please finish his speech a minute early?

--- Later in debate ---

[Mr Perkins]

Okay. I thank the hon. Gentleman for that clarification.

Britain is not alone in having a skills or apprenticeship levy, but the way we handle it is quite unique. As a result, there has been a dramatic fall in the number of entry-level apprenticeship opportunities. Research by the London Progression Collaboration shows that since 2014-15, entry-level apprenticeships have fallen by 72%, and the fall in apprenticeships for under-19s has been as much as 59%, depriving many of those at greatest risk of falling into poverty from the opportunity at the beginning of their careers to get an apprenticeship.

The latest figures show that £3.3 billion in levy funds have been returned to the Treasury in the last three years. It is not only a scandal, but a huge act of collective self-harm. It is no wonder that the CIPD said:

“Apprenticeship Levy has failed on every measure and will undermine investment in skills and economic recovery without significant reform”.

I meet so many small business owners who would be keen to take on an apprentice, but are put off by the lack of available support and the bureaucracy.

There is a stark contrast between this Government’s approach and the approach of the Labour Government in Wales. My colleagues in Wales have led the way in creating apprenticeship opportunities, ringfencing an additional £18 million of funding to be invested in apprenticeships in the coming financial year. In a recent report, the renowned think-tank EDSK argued for the need to expand the traineeship programme to promote the supply of entry-level opportunities and clear progression routes into genuinely high-quality apprenticeships. After the Government’s recent announcements, which set out that they are seeking to reduce the number of traineeships —I have spoken today to an employer who told me that they will have to abandon traineeships because of the Government’s current change—

[Mr Philip Hollobone (in the Chair)]

Order. The hon. Gentleman has had 10 minutes; the Minister needs at least 10 minutes to respond, so he needs to draw his remarks to a close pretty soon.

[Mr Perkins]

I was just coming to the crescendo, Mr Hollobone. As I say, those from small towns or villages are less likely to find apprenticeships available. Those from black and ethnic minority backgrounds are less likely to be able to access an apprenticeship.

In conclusion, a Labour Government will take a fresh approach. We will ensure that all funds allocated for skills are spent on skills and that apprenticeships are promoted to all and recognised as outstanding opportunities for young people, with more SMEs supported to offer them and more colleges equipped to teach them.