The issue: “How will the apprenticeship levy impact on and support apprenticeships across the region, and what more needs to be done to ensure all businesses can take advantage of the opportunities that the levy creates?”
How apprenticeships are funded, structured and delivered is undergoing fundamental reform. They are being introduced as we go to print yet there is still some confusion, uncertainty and a lack of awareness among many stakeholders as to what it all means.
BQ gathered some experts around the table to shed light on the changes, to debate what can be done to ensure everyone makes the most of the opportunities available, as well as set out some of the challenges and barriers, perceived or otherwise, particularly in the SME community.
There was an appetite around the table for employees to take full advantage of the new Higher and Degree Apprenticeships to help close the skills gap but concern that non-levy payers still don’t know how they can access funds.
The main message to come from the debate was the need for greater collaboration between higher education, further education, training providers and employers – with more effective support from Government and the Local Enterprise Partnerships – as the way for the region to create jobs, upskill, innovate and make the most of talent of all ages.
BQ chair Caroline Theobald asked participants, a mixture of guests from the world of academia and industry, to introduce themselves and give examples of what they and their organisations do, or will be doing, around apprenticeships.
Tricia Mullen, group training manager at construction company Esh opened the debate by explaining how the levy may impact on its approach. “When I started, we made a commitment to recruit 150 apprentices over three years, we have exceeded that target with 180,” she said. “We currently have 108 live apprentices across the group in nearly every function – from bricklayers to quantity surveyors and everything in-between. I am particularly passionate about apprenticeships and I know the benefits that they can bring to businesses. I have some concerns about the apprenticeship levy simply because we already pay a Levy to CITB (Construction Industry Training Board) which works fantastically well for us – it supports all the training we undertake. We spent £700,000 on mandatory training plus £100,000 on FE/HE training in addition to our apprentices. We have no issue with paying a levy but we are now going to get hit twice and I don’t think it will make us take on more apprentices – we will have to manipulate it so we convert existing positions into apprentices to recoup some of that investment.”
Dr Ruth Helyer head of skills at Teesside University said: “We have always been a university which believes in workplace learning – it is not just about lectures and seminars but about learning in the workplace then contextualising it in higher education, which is an appropriate thing to do for the 21st Century, where people need to be resilient, adaptable and all the things they can pick up from work experience. Teesside University is enjoying getting involved in apprenticeships and as a big employer who will be paying the levy ourselves we are looking at that as an opportunity. People will try and convert existing programmes which is an interesting slant on the Government target for 3 million apprentices by the end of this Parliament.”
For Frances Hoy, HR manager at plastics car part manufacturer Nifco, it is about encouraging anybody and everybody to do training. “We are growing our business to the point where we need skills that are becoming more technical. We are relatively new when it comes to formal apprenticeships. We have been established for 50 years but just started taking on apprentices through the formal route five years ago, though we have always trained and banged the drum for skills. The majority of our senior managers came through the apprenticeship route, so it is close to our hearts.”
With around 30 current apprentices, she said the company was near saturation point so had to tailor the number taken on with the support they can give but she said the levy could have a positive impact. “We will be repackaging due to the levy and we are looking forward to it,” she said. “It can help join up the training. Some of our trainers, our engineers, are due to retire so we need to attack skills from all different angles. If anyone wants some training they can have it.”
Professor Alastair Irons, academic dean, Faculty of Computer Science at the University of Sunderland, has been involved in setting up the first Degree Apprenticeships at the University. “I think it is a wonderful opportunity to see how the learners engage differently to our long course learners, so we as academics are learning a lot,” he said. “Having a job, having a life and learning – it is pretty intense so we need to look at the pathways for these young people and how we can support them both academically and from an employer perspective.
Pastoral and mentor support is one of the key things to come out of academics and employers working together. There are many challenges. One of the biggest is to make it easier for businesses to engage with universities and other providers. I do have concerns with the levy that employers see it as a tax and not as a benefit. It is something they are being punished for and paying for. Putting that aside, how do we ensure employers get their money’s worth and understand the concept that apprenticeships move through the different levels of learning right up to doctoral level? It is fascinating to be involved, working closely with employers in the design and development of new programmes has been reinvigorating.”
Awarding organisation NCFE designs and delivers qualifications. Policy and research manager Michael Lemin said one of the biggest challenges is the huge structural changes to apprenticeships. “The levy is a tax – there is no choice but to pay it – and I think the way apprenticeships are defined will change as a result. There will be much more emphasis on higher level apprenticeships and we will see existing staff doing training. What worries me is that there will be far fewer of what are seen as traditional apprentices, those who are 16-18 year old learners. The 3 million target is very arbitrary and unhelpful. If you design a high quality system that learners want to be actively part of you should never have to worry about the numbers coming through.”
Head of service facilities in the North East at global engineering business Siemens, Mark Armstrong said the success of its scheme was not replicated in many other sectors, which is something that needs addressing. “I am an apprentice, I served my time 38 years ago and I am with the same business today. Our whole senior management team is made up of former apprentices, our whole business is based on apprentices. Siemens nationally has about 600 apprentices, in the region we have about 80. We have just been through OFSTED as a training provider and we got outstanding in all areas so we are proud of that. What we do, we do well and we have a 100% retention rate. The model we have is fantastic, but apprenticeships is a dirty word that has been tarnished by other sectors in terms of what they are and there is a massive challenge in promoting apprenticeships at different levels.
“Ingenuity for Life is our strapline – that is starting people on a pathway to life, to go on holiday, buy a house, have a family and we have a social factor in terms of what we do. The legacy is a sustainable business because we have grown our own people and developed the business around them. The Government is taking the levy off us tomorrow but nothing is up and running yet but from an opportunity point of view, I think universities are going to get a lot of the more mature workers coming through the door to become an apprentice. You need training and development in all areas – we can train our teams to now obtain a degree. You are never too old to learn.”
Sue Graham, head of partnerships and local growth at Northumbria University, said: “We have always run part-time, work-based, demand led programmes for employers so for us it is looking at this as another way of funding and organising the work we do. Employers are coming to us asking how they can use their levy – it is a bit of a discovery journey for all of us.
“Apprenticeships will come in all shapes and sizes for all ages, it is fundamentally different. We can now talk about a postgraduate management programme as an apprenticeship – you are learning at different stages of your career. A challenge is SMEs and non-levy payers, how do we reach them? How do they access the pot because it could be a powerful way to support economic growth in the region? It has lots of potential but concerns for us are around traditional graduate recruitment, are employers going to take their own and grow them from age 18? But overall the benefits are massive for all providers.”
Muckle LLP will be taking on their first two solicitor apprentices from September and HR director, Claire Atkins said the levy hadn’t influenced the company’s approach.
“We have recruited business support apprentices for years – we have five or six in the business at the minute – and we recruited an IT apprentice for the first time last year.” The solicitor apprenticeships will be a six-year course. After four years they will get their law degree then after another two qualify as a solicitor. “We are really excited about it,” said Claire.
“Muckle has been trying to get it off the ground for a few years and we are so pleased it has come to fruition. We are also working with another four law firms as a consortium NESA (North East Solicitor Apprenticeships). Three are levy payers, two not. It is the first time we have worked together collaboratively. We have had 90 applications from a diverse group of people, of all ages, who saw this as an opportunity to get a foot in the door, people looking for a career change, those doing a law degree or a different degree seeing this as an opportunity to get into law – earning, while working and getting that work experience which clearly has attracted them. We would have done that without the levy and the challenges around it are, have we got the right training providers supporting us?”
Melissa Gardiner, head of quality and compliance KF Training, said it had positioned itself to take advantage of the new approach. “About two years ago we recognised training providers weren’t really giving employers what they were looking for.
It was more a bums on seat approach when it should have been based on skills so we bucked that trend and started developing employer-led programmes, all skills and solutions focused. We feel we are ahead of the curve when it comes to the levy and see it as a real chance to work and collaborate even more closely with employers. We are ready to look at skills programmes rather than traditional apprenticeships. I agree apprenticeships have been seen as a dirty word, which is one of the reasons the levy has been introduced – to drive up the skills. The funding is now in employers’ hands and in terms of quality there is a real challenge to drive it up across industry. How do we maintain the quality within this new provision?”
Like others around the table, Lynsey Whitehead, director of apprenticeships and business partnerships at Newcastle College, is a former apprentice and is concerned at the sustainability of the changes being introduced. “The reforms are not just about the levy – they are vast. We have been preparing by restructuring the team, particularly around curriculum development. SME is a concern, there is a definite perception that there is going to be levy investment fund left to support SMEs after the next two years. Government only secured it for two years and I am not sure that fund is going to be there so what are we going to do to support SMEs and other non-levy payers long-term?”
David Armstrong apprenticeship manager at energy consultancy company Utilitywise, sees the levy as a chance to transform its approach to apprenticeships and resolve issues caused partly by the company’s rapid expansion. “We had 12 apprentices start in April last year which is down to four,” he said. “We are hoping to enrol 40 soon and are looking to utilise the Government funding, how it will work for us and support us. We are really excited by the opportunity of the levy. Our retention rates are poor. Feedback from staff has been that they don’t feel invested in, they haven’t been given the training and development support within their roles. We see this is an opportunity for us to support our staff, to have careers. I agree there is a misconception that apprenticeships are for 16 and 18 year olds, the level of salary and so on. It is a re-education. We want to bring in local staff and retain them.”
Finding ways of engaging and collaborating with business is key to the success of higher level apprentices says Dr Amanda West, head of academic programme development at the University of Sunderland. “Our strapline is lifechanging and in terms of the type of students that come to us, a really high number are not traditional, with a higher education background. In terms of apprenticeships this is a really interesting time for us, because we can build on the work we are already doing.
As well as the learners we hope will be coming to us, we are already engaged with business – it is about how we can pull together the academic work we do with the work we do with business anyway. I am your traditional academic so this is instructive for me. I have only had a year out of education working for a housing association so I have never left the public sector. I am now based in the enterprise and innovation unit. It is like people talking a different language but it is incredibly exciting. I am bought into the idea of developing skills and addressing the low levels of productivity in the UK and North East.”
Suzanne McCreedy national services director at BE Group said: “We support all sorts of organisations, developing business information, events and business development programmes so I am really interested in finding out what everyone thinks of the levy and understanding the key messages we need support with in terms of employer engagement. We are an employee owned organisation so we invest heavily in training. We’re in the Times Top 100 for businesses to work for and as a SME we are going to be paying the levy, so we want to work out how to use that investment within the organisation and make a difference to the bottom line.”
Laura Woods, director of The Forge, Teesside University, said: “Forge is Teesside University’s front door for business and the concept behind that is business can get access to the resources and the expertise of the university just by coming to us. We are the mediators, our agenda covers everything from innovation, talent, skills, start-ups, digital start-ups as well as Higher and Degree Apprenticeships, which is really exciting for us. We pride ourselves on working with business and this will help develop long lasting relationships with employers. We have five apprenticeships on the go and another five starting in September. There is a fear that Degree Apprenticeships might take the place of degree students but the way to look at it is we are growing opportunities, and not just for young people. It is just as important to develop people already in work. I have also got a son who is an engineering apprentice, who found this mid-career as a new route to career satisfaction and is really enjoying it so I wholeheartedly recommend it.”
Laura believes a critical issue is how are the SMEs, non-levy payers, going to engage with the reforms and how providers can support them.
Chair Caroline Theobald said the collaboration of the law firms was a great example of best practice engaging SMEs.
Claire Atkins explained: “The great thing about us all working together is we have all got different experiences – it means we are reducing workload rather than repeating work. When the apprentices start they will have a peer group to work together. Once a month they will go to London together, and once a quarter we will all take a lead on a training initiative. We want all the apprentices to have the same opportunities, regardless of which partner they are working for and what area of law they are practising so we get some consistency. We are looking at a training matrix which I started drafting and thought it might be useful for all the firms participating. For example, we send our newly qualified solicitors on a networking course and I have asked those who run it what they can do for the apprentices. I don’t think we can get money from the levy, but we have done things like shared contract of employment, offer letters and looked at ways to help each other.”
David Armstrong believes such an example will help other businesses in other sectors. He said: “We have had a lack of knowledge and understanding of what an apprenticeship is. We took apprentices on because we thought it was the done thing to do but didn’t have any plans or processes in place to manage them so the engagement wasn’t there which resulted in a fall off. Since being in post I am making sure that support and guidance is there for them to make the most of the apprenticeship experience.”
The Esh approach has been to work very closely with its supply chain. Tricia Mullen said: “We put the majority of our apprentices with our supply chain and our subcontractors. They are employed by us but we do this as standard practice with hand-picked subcontractors who have a proven track record of mentoring. It is important so you don’t get that dropout rate. The first year is really challenging and the person who arrives on the first day is completely different to what you get at the end. We offer the support and intervention so if an apprentice is becoming disengaged we try and put our arm around them, see them, speak to their parents because it is important to remember they are kids.”
Alastair Irons said understanding that role is important. “It is the glue which joins everything together. We find the expectations of employers who haven’t had apprentices before is different, we must signpost them and re-educate them on how to support apprentices.”
Tricia added: “When I first came into the business those being interviewed for things like quantity surveying were having complex mathematical questions thrown at them because they wanted to put them on the spot. They should have been asking which football team do you support? What do you do on the weekend? Do you have brothers and sisters? – You have to be much softer because they are not fully formed.”
Nifco has won numerous awards for its approach to apprenticeships and training programmes. Frances Hoy said employers needed to engage at every level to promote the vocational route. “We are willing to bring small companies on site via the North East England Chamber, any agency with schools and colleges, cadets, the High Force charity, universities – it is a jigsaw puzzle from the schools to companies, educating them about apprenticeships. We use our apprentices as ambassadors and open our doors to show visitors we are in a clean, modern manufacturing environment. We are also involved in Trailblazers, we need plastics technicians – the trainers are few and far between and due to retire so we are setting the standard, training the trainer and providing more support.”
Mark Armstrong said: “We weren’t getting the quality we wanted so we brought the apprenticeship programme in house. They go to college, then come and do their skills on site. You want to make sure they are employable and sustainable as it is a massive investment. You need a quality product to come out the other end. We offer the same service to our supply chain – we don’t promote Siemens we promote engineering. We go into schools, the STEM ambassadors are the apprentices who talk to young kids as we try to create a network of enthusiasm for engineering that will support the SMEs, ourselves and growth in the region. An apprenticeship is a competency based training programme – what we should be looking at is what this looks like to get the end product. Nurturing is important, we have someone who plays that role, but an apprentice can be any age.”
Lynsey Whitehead said: “We have longstanding relationships with a lot of SMEs who are non-levy payers because we have done apprenticeships for so long. In terms of new relationships, we are trying to advise them – the feedback is it has been like a Timeshare sale with providers coming from all sides – so this advisory approach seems to be working.” She shared an example of collaboration with SME Quantum Brickwork. “Apprentices need a CSCS (Construction Skills Certification Scheme) card to allow them to work on-site from day one and we didn’t offer that in the past,” said Lynsey. “It is vital so now we do – the cost of £55 is quite significant to a one-person micro business. It was a quick win for us and a massive help for them to include that in our delivery.”
More needs to be done to understand the needs of the smaller businesses said Michael Lemin. “It feels to me when Government talks about employers they mean the big employers. So often apprentices are showcased from the big companies. The non-levy paying SMEs are at a massive disadvantage. Inevitably the competencies are being designed by the bigger employers and they are not always fit for purpose for the smaller employers.”
Sue Graham said: “We need to invest in the existing workforce, there is a real leadership and management deficit in the North East and that is a real area of opportunity. We are bringing critical thinking, problem solving, real high level skills through graduate apprenticeships. What knowledge can they apply and develop?
Tricia Mullen returned to the example of Quantum Brickwork. “They could have got £10,500 for taking on an apprentice and got a card through the CITB. Small employers are not aware that they can access all the things we can.”
Laura Woods believes no-one should under estimate the task. “It is important we all communicate with employers to advise them of the options but it is a huge amount of work. People in our organisations have to understand how it works, not just go out and do the hard sell, but give the advice and support.”
Sue Graham agreed and again pointed to the benefits of collaboration and flexibility. “Working on the software engineering degree, some of the small companies don’t do some of the things on the standards, so we have had to find a way of working with bigger employers, who have been very generous, there is a kind of grouping consortium needed to ensure they get the full range. Some of it we have had to teach in the university as they cannot do it in their workplace. It is about sharing good practice and jointly using resources.”
Ruth Helyer said: “Some of the smaller businesses are really specialised so the higher-level programmes may well suit them. You can pay to get up to a doctorate in apprenticeships which you have never been able to do in the past – that could be a great thing for a SME which could make a big difference to that company. An apprenticeship should take up 20% of that person’s working life which is a real commitment for a SME, which might they be prepared to let someone do that for the higher skills.” Frances Hoy warned. “They are asking for 20% of the job for a 10% contribution from SMEs which is a big ask – they need to see the benefits.”
There was some discussion as to the benefits of using the levy to design and deliver more in-house training programmes rather than from other providers but the consensus was using a specialist training provider was advisable in most cases.
Suzanne McCreedy said: “We handle 50,000 calls a year – the debate has proved useful in how we can support them with the levy. Every business is different with different questions and it is trying to understand how to pull useful information together to give them options which is the best route for them.”
There were opportunities for collaboration, especially around higher skills, even if a company does its training in house said Mark Armstrong. “I just need two people to do a Degree Apprenticeship in project management, it is not a full class at that level so collaborating is something that would help us and in turn could help SMEs. We are not competing when it comes to project management and digitalisation so how we can pull that together?
Ruth Helyer said: “A mixed cohort get a lot from each other in non-competitive scenarios where they are all learning in areas like leadership and management. Watching them from different sectors learn off each other is fantastic but it is hard to manufacture it.”
Alastair Irons said: “If we were to build a cohort of ones and twos from SMES we would be very nervous.
Normally we know in January who is coming in September and you can put things in place but things can change for businesses right up to the last moment. We had an employer pull out in July, 15 students due to come in but they just changed their minds. It is difficult - we are a business as well.”
Caroline Thoebald asked if there was still a problem with the language around apprenticeships and levy?
Lynsey Whitehead said: “There is a misconception that an apprenticeship is for a 16-18 year old. That is not the case but were the reforms a chance to rebrand them – to emphasise it is for any age?”
Laura Woods disagreed saying changing the brand would just cause further confusion.
Amanda West added: “We are getting lots of phone calls from parents and students trying to enrol on a Degree Apprenticeship and that is a significant challenge (explaining to them that’s not how it works). Perhaps universities need to do something jointly with businesses who are sending STEM ambassadors into schools, or they come to open days to explain how they work.”
Michael Lemin said: “I think you can control that message when the Government mandates schools to get employers in to talk about vocational education and apprenticeships. Employers can do that now. It was mentioned earlier that apprenticeships is a dirty word - I usually term it as the apprenticeship brand being weak as it has been tinkered with over the years. Careers advice provided by schools is always going to be geared toward academic because they have an interest in learners coming back for sixth form so the more employer links there are with schools, the more we can get young people to understand how it works before it is too late and they have made their choice.”
Esh has strong links with schools and puts a big emphasis on education and Tricia Mullen said: “Through the Build My Skills programme, we work with Year 10 delivering sessions about CVs, interview skills, online profiles and so on. For the last two years we have bussed them into St James’ Park for interview, which is a great lead into the apprenticeship route.”
Mark Armstrong said there was also a great opportunity for NEETs [those not in employment, education or training]. “We run a NEET programme, getting them engaged in opportunities for them to start a programme. It doesn’t matter how old they are, they can redirect their career or lack of into an apprenticeship. It is all about communication, we sit here knowing this stuff but not many people do. There is still a huge piece of work to do by the Government. Advertising concentrates around the young and not about the fact you can be any age.”
Melissa Gardiner said taking a whole business approach was how KF Training had looked at the issue. “We have challenged training norms around skills development, showing employers the value of training. We stopped calling things apprenticeships – changing them to skills development training programmes. We have no less than five on a programme with a lot of collaborative working within groups. We might have someone doing continuous improvement on the shop floor alongside their managers doing a project with those people in their team, then some at Level 5 doing the strategic work to support that whole project. It is an investment employers see the value of.”
The debate concluded with broad agreement, there were examples of good practice but they were not being widely shared. Confusion remains and norms need challenging. Lynsey Whitehead said some employers were wanting training outside the normal academic calendar so providers had to look at ways to deliver programmes when they were needed.
Ruth Helyer said everyone who had knowledge of the system had a part to play in educating others, saying there needed to be consistent communication, marketing and explanation around all aspects of the reforms.
It was Mark Armstrong who summed up the debate when he said: “Businesses buy people and development of people is key to a successful business. Here is an opportunity through the levy so why would you not want to be involved?”
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