Apprenticeships: Government Support

Toby Perkins Excerpts

Tuesday 24th January 2023 Westminster Hall

[Mr Toby Perkins (Chesterfield) (Lab)]

I absolutely agree with my hon. Friend’s point about the value of apprenticeships to the NHS. I asked the Government a question about how much was unspent from the NHS apprenticeship levy fund and I was told that that data is not held. Undoubtedly, millions and millions of pounds are sat unspent in NHS funds and are being sent back to the Treasury because of the lack of a functioning apprenticeship programme.

[Karin Smyth]

That is a subject worthy of a debate on its own. I spoke to one of the Minister’s predecessors, who was a nurse at one point, about that very problem. It is a thorny issue, but it is surmountable. We now have 130,000 vacancies. It is woeful and shameful, but this is preventable, as it is for sectors beyond the NHS. For example, if we are serious about tackling the climate crisis with high-skilled green jobs, we must cultivate the talents and skills of everyone to reach net zero. We cannot rely on those with a degree; we need more people. We need our education system to work for everyone and give people the options and pathways that work for them. Right now, it does not.

Apprenticeships give people things they need for a career in a way that no other path of study does. All of us are here today because we agree with the fundamental premise that they are flexible, agile, rooted in the real world and earned by experience. Each year, I am proud to run my own annual apprenticeships fair. A bit of a plug: my South Bristol Jobs and Apprenticeships Fair will take place next month at the South Bristol Skills Academy, which helps people in the area to match their ambitions and experiences with the needs of local businesses.

--- Later in debate ---

[Mr Toby Perkins (Chesterfield) (Lab)]

It is a great pleasure to serve under your chairmanship, Mr Hollobone.

As others have done, I congratulate my hon. Friend the Member for Bristol South (Karin Smyth) on securing this debate. It is obviously on an issue that is of tremendous importance to a lot of us, and with National Apprenticeship Week approaching in early February, the timing could not be better.

Labour believes that apprenticeships are the gold standard in skills development, and we would seek to increase both the number and the quality of apprenticeship opportunities under a future Labour Government, as well as promoting apprenticeships to students, workers, parents and employers

I always say that the greatest advocates for apprenticeship opportunities are apprentices themselves. When I meet them, they often say how grateful they are for their opportunity and how glad they are that they have taken the apprenticeship path. However, I also often reflect, as other hon. Members have already done today, on how little apprenticeships seem to be talked about in schools, so it is important that we make sure everyone knows that these opportunities are there.

In the last year, I have visited outstanding independent providers, such as Remit Training in Derby, where I saw its superb automotive academy, and I have also seen the construction academy at Skills People Group in Rotherham. In addition, I have been pleased to see excellent provision at further education colleges.

As many other Members have said, apprenticeships are vital for social mobility and are genuinely transformative. We recognise the important role that apprentices play and want to see more young people having the opportunity to take an apprenticeship.

My hon. Friend the Member for Bristol South spoke about the importance of public sector apprenticeships. As I said a minute ago, there is far too little focus on a strategic opportunity that exists, particularly within our health sector but across the public sector, to expand the usage of the apprenticeship levy within that sector. She also spoke about how difficult it is for local businesses to become involved in offering apprenticeships. I am told by some of the apprenticeship providers that as much as 50% of their budget is spent not on teaching the apprenticeship but on administering it, which is a crazy system.

Many Government Members are keen to suggest that colleagues in Europe are overly bureaucratic. Let me tell them that there is not a single bureaucrat in Brussels who could have imagined the barriers that have been placed in front of apprenticeships here.

My hon. Friend the Member for Bristol South also reflected on the fact that the Minister—the Minister of State, Department for Education, the right hon. Member for Harlow (Robert Halfon), for whom my hon. Friend and I both have great respect—is the eighth different Skills Minister in the past 13 years. Indeed, he is the fourth that I have the privilege of shadowing in the three short years that I have been in my current role. My hon. Friend also spoke powerfully about the fact that too much of the apprenticeship levy is being spent at levels 6 and 7, which is a theme I will return to.

The hon. Member for Strangford (Jim Shannon) spoke about young people who do not see university as being for them, and he is absolutely right in that regard. However, it is important that we do not see apprenticeships as a second-class option. Apprenticeships are a great opportunity for straight-A students as well as for those who have other talents. Although he is absolutely right that we should always promote that alternative to university, it is very important that we do not see it as a second-rate option.

The hon. Member for West Dorset (Chris Loder) referred the Government’s involvement in apprenticeships and the fact that the number of people doing apprenticeships is lower than it was before the introduction of the levy. He also spoke powerfully about the bureaucratic barriers to land-based apprenticeships and the importance of them in his constituency.

[Chris Loder]

I do not think I quite said that there was a decrease in the demand for apprenticeships or the actual apprenticeships taking place. I just want to correct the hon. Gentleman on that point. Funding for land-based apprenticeships had reduced to the extent to which the schemes were no longer viable.

--- Later in debate ---

[Mr Perkins]

I accept the hon. Gentleman’s point. He has corrected me on what he said, but it is none the less the case that fewer apprenticeships are now being provided across the board than before the introduction of the levy. Whether he said it or not, it was none the less factually correct.

My hon. Friend the Member for Weaver Vale (Mike Amesbury) reflected, as he has done previously, on his own history as a careers adviser. He knows the importance of independent face-to-face careers guidance, which is one reason why the Labour party has made that such a priority. Other Members reflected on the fact that businesses and other apprenticeship suppliers are unable to get into schools. That is why, during the passage of the Skills and Post-16 Education Act 2022, we were keen to see the Baker clause introduced in another place. That would have meant that each student had three opportunities to see the alternatives to going to school sixth form. We think that independent careers guidance will play a really important role in that.

The hon. Member for Meon Valley (Mrs Drummond) said that many small businesses cannot access the levy. She is absolutely right. When the apprenticeship levy was introduced, an increased fund came in from the levy payers, but at the same time the Government massively reduced the amount they spent on apprenticeships. The result was that those that do not pay the levy are shut out. The Government are now allowing major businesses that pay the levy to donate some of their levy funds to their suppliers and others on a charitable basis, but it needs to be much more strategic than that.

The hon. Member for Crewe and Nantwich (Dr Mullan) spoke about the importance of pre-apprenticeship vocational opportunities. He is absolutely right. Labour will look to push the skills and growth levy towards traineeship and pre-apprenticeship opportunities, and allow businesses to use their levy in that way.

The hon. Member for Gloucester (Richard Graham) was characteristically optimistic. He dismissed the fact that there are fewer apprenticeships than before. He said he has met employers who speak positively about apprenticeship opportunities, and he is absolutely right. He said that many employers never had the opportunity to offer apprenticeships before, but the reality is that the funding for apprenticeships was there. The Government have a different way of approaching it. We think there are many failings with that, and we are not alone on that. He also asked about how many Labour MPs employ apprentices. I do, and I am informed that my hon. Friend the Member for Weaver Vale does too, but I am afraid I have not done an audit beyond that. He spoke about the importance of businesses and suppliers getting into schools.

[Richard Graham]

rose—

[Mr Perkins]

I want to give the Minister enough time to wind up, but I will allow the hon. Gentleman to intervene very quickly.

[Richard Graham]

That is kind of the hon. Gentleman. I mentioned all those organisations because those apprenticeships did not exist until we introduced the specific categories for them—accountancy, stonemasonry and all the rest of it. They did not exist before 2010.

--- 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.