Question to the HM Treasury:

To ask the Chancellor of the Exchequer, with reference to the review of the Apprenticeships Levy, whether he has had recent discussions with Cabinet colleagues on (a) increasing the uptake and (b) improving the quality of apprenticeships in STEM.

As part of the Spring Statement, the government committed to considering whether further intervention is needed to encourage employers to offer the high-quality employee training the UK needs. This will include examining whether the current tax system – including the operation of the Apprenticeship Levy – is doing enough to incentivise businesses to invest in the right kinds of training. There will not be a formal review of the Apprenticeship Levy or system.

As an employer-led offer, employers can choose how many apprentices to take on, what standards they offer, and which training provider to use. Combined with the introduction of the Apprenticeship Levy, the government has created hypothecated funds to support employer investment in the high-quality training an apprenticeship can deliver. Where these funds are not spent by levy payers, they are allocated to non-levy paying employers who receive support for 95% of the cost of high-quality apprenticeship training.

There are over 340 apprenticeship standards that are closely linked to STEM occupations in sectors including Construction, Engineering and Manufacturing, and ICT. In Academic Year 2020/21, there were 78,100 apprenticeship starts in STEM, making up 24% of all apprenticeship starts that year. Popular STEM standards included Level 3 Engineering Technician (5,401 starts) and Level 4 Data Analyst (3,717 starts).