Can Nick Boles MP ensure new apprenticeship standards don’t disenfranchise smaller employers?

Can Nick Boles MP ensure new apprenticeship standards don’t disenfranchise smaller employers?

Steve Nash, Chief Executive of the Institute of the Motor Industry is hoping to be able to put the case to the new Minister for Skills, Nick Boles, that the new apprenticeship standards don’t exclude smaller businesses. In particular, he is concerned that the current model being debated by ‘trailblazer’ groups doesn’t fully take into account the funding, administrative and most importantly, skills needs of smaller businesses.

“The Government has clearly demonstrated its support of apprenticeships, calling for them to be viewed as equally valid alternatives to A levels and university programmes”, said Steve Nash. “And we believe that the ‘new norm’, as the Government is calling apprenticeships, is already being adopted by many employers in the automotive retail sector, with our latest analysis showing that there was a 4.2% increase in apprenticeship starts in 2012/13.

“But going forward, the key to success will be ensuring that micros and small businesses, which make up around 75% of our sector, can be as engaged in apprenticeships as bigger employers. We are concerned that those conducting trailblazer projects are being encouraged to develop standards at a minimum Level 3. Yet currently the majority of apprenticeship completions in our sector are at Level 2.”

The IMI believes setting the benchmark at Level 3 misses the fact that there are a considerable proportion of businesses across the UK – and particularly in the automotive sector – that simply do not need all of the skills required to achieve Level 3, yet still want and need to be able to demonstrate their competence to undertake work at a Level 2 equivalent standard. For example, independent garages with less than 5 employees.

“It’s good to have aspirations to raise standards, but how do we keep micros and small businesses engaged if we raise the bar too high from the start? Developing a standard which incorporates a natural dropping off point at Level 2 but allows those who so wish to continue up to Level 3 is the ideal solution” continued Steve Nash. “We also believe the current proposal will simply not be economically viable for micro and small businesses because of the proposed changes to the way that the apprenticeships will be funded.”

There have been a number of consultations into the proposed funding mechanisms, and the IMI have responded to all of these. The most recent consultation was around the proposed payment of funding via HMRC tax/PAYE systems, and the proposal of an ‘apprenticeship credit’ system for micro/small businesses or businesses who did not meet a minimum tax threshold. But the IMI is concerned that smaller businesses simply won’t have the capital to fund the learning provider costs upfront, nor be able to take on the additional administrative burden.

“As a sector, we must work together to ensure that any proposed changes to the apprenticeship programmes empower the recruitment and training of the next generation” added Steve Nash. “This is vital to the industry’s future success, which is why we look forward to meeting with the new Minister responsible for Skills as soon as possible.”

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