An estimated £600m a year in government funding is at risk of being wasted on low-quality apprenticeships, public services think-tank Reform has warned.
Last April’s Budget introduced an “apprenticeship levy” on all businesses with an annual wage bill of more than £3m, in order to fund an additional three million new apprenticeships by 2020.
The tax on the private sector was supposed to fund meaningful training for young people and tackle skills shortages in the UK job market.
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However, Reform’s report estimates that £600m of the £2.7bn raised in the levy is being spent on “MBA-style executive programmes or low-skills training that fail to meet the standard of teaching young people a trade”, says the Financial Times.
The report, entitled “The great training robbery”, says that employers are “using the levy to rebadge existing training courses”, including executive leadership courses for managers, in order to access the Government subsidy.
At the other end of the scale, the report also found instances of “low-wage jobs including restaurant waiters and hotel reception staff among those now being classed as apprenticeships”, says The Independent.
Reform warns that “such training courses do not meet the historical or international definition of an apprenticeship, because they typically offer minimal training, represent low-wage jobs and do not constitute skilled occupations”.
Tom Richmond, senior research fellow at the think tank, said that the Government “urgently needs to get rid of these poor quality apprenticeships in order to provide more opportunities for young people to train as genuine apprentices”.
Reform is urging the Government to drop the three million apprenticeships target and instead prioritise quality over quantity.
However, the report has been criticised by some employers and professional bodies who deny that their training courses are not the real deal.
Petra Wilson, director of strategy at the Chartered Management Institute, said that executive management training was tangibly linked to a increase in business productivity.
“It is disappointing that those with a policy focus on social mobility and getting new entrants into employment are also missing the wider objectives of the levy as route to improving productivity,” Wilton told the FT.
She added that almost half of the 1,500 people enrolled in its degree-level executive management apprenticeship were from deprived socio-economic backgrounds.
