Apprenticeship reforms announced by prime minister

Reforms to apprenticeship system in England have been announced, alongside publication of the first Skills England report highlighting nationwide skills gaps.

The government is boosting opportunities for young people through apprenticeship reforms.

Prime minister Keir Starmer and education secretary Bridget Phillipson announced a new growth and skills levy which will replace the existing apprenticeship levy and include new foundation apprenticeships.

These new apprenticeships will give young people a route in to careers in critical sectors, enabling them to earn a wage whilst developing vital skills.

The new levy will also allow funding for shorter apprenticeships, giving learners and employers greater flexibility over their training than under the existing system – where apprenticeships must run for at least 12 months.

The training eligible for funding under the new levy will develop over time, informed by Skills England’s assessment of priority skills needs. 

The DfE will set out further details on the scope of the offer and how it will be accessed in due course.

To fund this, employers are being asked to rebalance their funding for apprenticeships, asking them to invest in younger workers. This will also involve businesses funding more of their level 7 apprenticeships – equivalent to a master’s degree and often accessed by older or already well qualified employees – outside of the levy.

The report has found that employer investment in training has been in steady decline over the past decade, with training expenditure at its lowest level since records began in 2011, with investment per employee down by 19% in real terms. This highlights the need for government reforms to the skills and apprenticeships system.

It also shows that, across the UK, almost 1 in 10, or over 2.5 million roles are in critical demand, with more than 90 per cent being in roles that require training or education. 

The government launched Skills England in July to help identify skills needs. Skills England will play a crucial role in determining which types of training will be eligible for the expanded growth and skills levy and will set out shortly how they will work with stakeholders to inform their advice to DfE. 

The need for jobs and skills varies across industries, with the health and social care sector experiencing the highest demand, followed by education, manufacturing, and science and technology.