An independent review in 2010 of fees and co-funding in further education [1] for the SFA highlighted the poor record in collection of fees for matched funding training by individuals and employers. It also highlighted the use by some providers of fully funded 16-19 year old training to subsidise the shortfall in fee collection in over-19 skills training. This was a consequence of the funding regime whereby providers, and especially FE colleges, received an element of their funding based on the aggregate number of students, coupled with a desire not to lose students through demand for payment of fees by employers or individuals.

The system for ensuring individuals and employers co-invested alongside Government in a range of Further Education provision failed. It was not securing the level of investment expected and required from those who should contribute, and action was deemed essential to change what was widely regarded as 'unfair and untenable.'[2]

Consequently, the collection regime under the Coalition Government has changed radically across all training and apprenticeship schemes funded through the SFA and the Young Peoples Learning Agency (YPLA). Moreover, there has been more discussion about large employers improving their levels of contribution to apprenticeships, and this being a potential disincentive to having apprentices in the workplace. Whilst it is recognised that employers contribute in kind through the provision of training space and in allowing time off for training, collecting other contributions may be therefore difficult to enforce. 

 

Any concern that such a disincentive would be allowed to influence the overall apprenticeship numbers must be set in the context of the strong commitment by the Coalition Government to increasing the numbers of apprenticeships to both increase employment and improve skills. Proof of this commitment can be seen on the Department of Education website (DfE) referencing 16 -18 apprenticeships: 'The Government is committed to expanding the apprenticeship programme. The Department is working to ensure that more young people are able to take up an apprenticeship. We are working to develop clear progression routes into higher level skills, and improve the quality of apprenticeships to make them better suited to the needs of employers and learners.'

There are, however, planned changes to which learners will be fully funded by the government, and this will change the nature of the offering in that for some learners over the age of 24 an apprenticeship will require funding through government backed fee loans.

Another key area of change is the creation of an integrated approach to those needing support to move into employment and to improve their skills to make that possible. This means a growing focus on vocational training being targeted towards young people being placed in employment under the Work Programme.

The landscape for accessing funding is complex. While there are pressures to continue to simplify the funding for apprenticeships, it is unlikely to become completely straightforward in the foreseeable future. Even were it simplified it would remain complex as the Skills Funding Agency, National Apprenticeships Service and the YPLA are all part of the new structures around apprenticeships. It is further complicated as there are two departments sharing responsibility for skills: The Department for Business, Innovation and Skills (BIS) and the Department for education (DfE). Add into this picture the Department Work and Pensions (DWP) and Jobcentre Plus linking skills and employability as they see apprenticeships as a mechanism to reduce unemployment.