In 2015, the Conservatives committed to creating three million new apprenticeships by 2020 in their general election manifesto. The development and delivery of degree-level apprenticeships is seen as a key part of this policy reform and to fund this initiative; the government is introducing an apprenticeship levy from April 2017, a charge on employers’ (both public and private) payroll which is hypothecated for apprenticeship schemes.
With this change has followed an intense amount of interest in apprenticeships in the HE sector, which has collectively been trying to get to grips with the almost impenetrable regulatory and policy landscape surrounding the qualifications and the challenges and opportunities they bring.
Levy funds will be spent through a new digital apprenticeship service which allows employers to spend available funds on approved training schemes. Smaller employers, those with a pay bill under £3m/year which do not pay the levy, will receive a 90% subsidy towards the cost of apprenticeships, a pretty enticing incentive.
Until now, both higher (FHEQ level 4+) and degree (level 6+) apprenticeships account for a small proportion, less than 5% of all apprenticeships, a total of 43,800 students in 2015/16. In that year, there were 4,300 degree apprenticeships started. Higher and degree apprenticeships exist in parallel; the key difference is that degree apprenticeships result in the apprentice receiving a bachelor’s or master’s degree at the end. With significant funding – by 2020, double the level in 2010 – available, degree apprenticeships are a potential new income stream for universities. With the levy funding available soon, a significant growth in numbers is predicted as employers spend their vouchers.
However, although this levy applies across the UK, the nations will receive the funding raised by the levy in their government grant determined by a calculation within the Barnett formula. However, due to the end of other apprenticeship funding from Whitehall and the enforcement of the levy on public bodies, devolved nations are not significantly better off. Regardless, they have had their hand forced on apprenticeships despite skills policy being a devolved area. As a result, none of Scotland, Wales or Northern Ireland will be adopting the digital voucher scheme and instead using the limited funding to underpin existing apprenticeship policy. For example, Scotland is currently developing graduate-level apprenticeships that map to the SCQF.
One of the most confusing elements of degree apprenticeships, and in turn higher apprenticeships, is the semantic difference regarding standards. Inherited from pre-HE apprenticeships, standards (previously known as frameworks) refer to the curriculum rather than standards as the HE sector knows them, i.e. the attainment level. For degree apprenticeships in England, trailblazer groups of employers develop standards and assessment plans for a particular apprenticeship that needs to be approved by the government. Approval currently sits with the Skills Funding Agency (SFA) and will soon become under the remit of the newly established Institute of Apprenticeships. If the trailblazer group believes the standard meets level 6 or 7 of the FHEQ, the trailblazers can state this in their Expression Of Interest (EOI). The guidance suggests that degree-level apprenticeships should be developed in partnership with universities and professional bodies.
Place this concept of standards on top of the existing definitions in HE, academic standards, threshold standards and quality, all of which have subtle but important meanings makes this a complex area to navigate. The subtleties of HE standards were recently discussed late at night at one of the HE Bill committee debate in the Lords. One can ponder the dreaded standards question of select committees past to evolve into the question: ‘is a degree at Oxford Brookes the same as a degree apprenticeship at Oxford Brookes?’
Autonomy and markets
From May 2017, employers paying the levy will be able to choose either a lead training provider or end-point-assessor from a new register of apprenticeship training providers (RoATP). For an HE provider to be considered to be a lead training provider for a degree apprenticeship with an employer, it needs to be on that register (applications closed 25 November 2016 – but you can reapply each year). The conditions for getting on this register appear to duplicate some of the HE sector’s baseline quality requirements under HEFCE, including capability and quality of learner journey, although they are encouraged to use findings and evidence from QAA reviews. If HE providers apply through the “main application route”, and are successful, they will also be searchable to employers on the digital apprenticeship service.
There are some basic concerns about autonomy for the HE sector. At its most simplistic level, standards and assessment plans are designed by trailblazer groups and approved by a national body, which lends itself to the question: where does the autonomy of the sector come into play? If a higher education provider joins the register and then competes to become the training provider of choice for employers, the standard it delivers could have been developed completely outside that HE provider.
Assuming that universities get their heads around the standards, and fulfil the registration conditions, there’s still a major barrier to making apprenticeships a major part of the business: that’s the nature of the market. Universities are, for the most-part, good at business-to-consumer sales by marketing their services to individual students and recruiting them to programmes. In the case of apprenticeships, the employer is the customer and so there’s a need for a business-to-business sales strategy. This is then complicated by the need, at the point of delivery, for acceptance and progression on the apprenticeship to be conducted dually – with university and employer sign-off for their respective roles.
As the levy applies to larger employers, one might assume that the big companies will seek efficient ways of spending the money, making the most of the allocation. National employers may seek national contracts for apprenticeship delivery which would mean that universities would need the infrastructure – probably electronic delivery and assessment platforms – to serve a wide geographic spread of learners. For many universities, competition for students is a local matter: the nature of the market for competing at national level will be very different to that which they have become used to. Building systems for apprenticeships, building business relationships and building products which are appealing will be a new challenge. It is unlikely that every institution investing in this area will realise its ambitions.
Battle of the sectors
The government has established the Institute for Apprenticeships to act as an independant body responsible for approving standards and assessment plans. In its report on the ‘Reforms to apprenticeship funding in England’, the IFS expressed concern for how the quality of apprenticeships can be guaranteed. The IFS argues that with the target of 3 million apprenticeships, including degree apprenticeships, the Institute of Apprenticeships will be put under pressure to approve standards. These standards are notoriously difficult to get approved, as demonstrated by the FE Week report that under half of all apprenticeships approved for delivery still had no approved assessment organisation in December 2016.
In a small (n=30) survey from Universities UK, respondents stated bureaucracy around standards was the main barrier to delivering degree apprenticeships. It is notable that many of the trailblazer standards have been rejected a number of times, for example in mining and processing.
As it this weren’t complicated enough, the role of QAA in assuring the quality of degree apprenticeships remains unclear. In the latter months of 2016, it was reported that Ofsted had made a play for a more formal role inspecting the employer half of the degree apprenticeship. Mark Dawe, Chief Executive of The Association of Employment and Learning Providers (AELP), led a damning attack on the HE sector’s faith in QAA stating “Let’s stop pussy footing around and pandering to the HE sector. Ofsted need to have a role in inspecting all apprenticeship provision whatever level it is”. However, guidance for trailblazers states in a footnote that “Degree apprenticeships are subject to the quality assurance requirements of QAA”.
After all, joint HE-Ofsted approach, although clearly not a universally popular option, has been proven possible in teacher training.
QAA has begun its development of a Degree Apprenticeship characteristic statement, which should be ready for consultation in May 2017. To be clear, a characteristic statement is not designed to define standards or a qualification but describe the distinctive features or a qualification and contextualise it within the FHEQ. An exercise which may prove to be helpful to ensure that English degree apprenticeships can be easily placed into UK-wide framework.
It is unclear how the conversations between sector bodies are progressing behind closed doors. In the recent consultation on the strategic guidance for the Institute of Apprenticeships, the list of bodies needing to work together included Ofsted, QAA, OFQUAL, SFA, HEFCE and the future OfS. Yet, with the levy funding ready to access in two months’ time, having such an unclear picture of the quality assurance mechanisms in place for degree apprenticeships seems a significant barrier to success. But let’s be clear, although the predicted increase in degree apprenticeships is due to kick in once the levy funding becomes available, this is a current and very live issue.
So…clear as mud?
The apprenticeship policy reforms in England have evolved in a confusing qualifications and quality assurance landscape. Consequently, degree apprenticeships are left trying to meet the needs of very different stakeholders and sector bodies. Ultimately, HE providers are stuck in the middle of an unclear policy, yet they will play a vital role protecting the status and standards of degree apprenticeships.
In recent months, particularly since Justine Greening became Education Secretary, the government has pushed to create more apprenticeships in the hope that they will improve the skills economy and employability for young people. The government’s recent industrial strategy green paper includes commitments to technical education, in large part a response to Brexit but also to address the productivity gap and the marked geographic and demographic divides across the UK. The emphasis has also notably been on opportunity and social mobility as a result of apprenticeship training.
But whether apprenticeships alone can resolve inequalities with any large-scale impact needs more consideration. Simply offering apprenticeships will not be enough to create the scale of change desired by the government. In another sense, the direct link between apprenticeships and social mobility presents both a semantic and tangible problem – is the Department for Education looking to target apprenticeships at young people who are from poorer and more disadvantaged backgrounds, with the aim of class uplift, or looking to improve the skills economy across all levels? This is important – the way the sector and the government speak about apprenticeships could further entrench divisions between the apprenticeship and university pathway, or help heal them.
Lessons for social mobility from apprenticeships
There is an issue of parity of esteem when considering the general apprenticeship pathway and the traditional university route. There is the enduring sense that vocational work and the standards of apprenticeships cannot match those of a degree. The Social Mobility Commission reported last year that for those of ‘degree-age’ (19-24 year olds), almost all those who begin an apprenticeship did so below higher education level, with only 5% of the entire group beginning higher apprenticeships in 2015/16. Universities UK recently stated that improving widening participation figures was a reason why universities should invest in degree apprenticeships, which might signal some hope, but there is more to be done that simply offering an alternative pathway.
Mobility should also move beyond class. Apprenticeships also suffer similar gender divisions as in higher education. According to a Sutton Trust report from 2015, engineering apprenticeships remain male dominated with 96% men while beauty therapy apprenticeships are dominated by women (99%), an implication of this is women earning £1 less and hour on average. Given that STEM skills are also the focus of the industrial strategy green paper, the government, employers and universities must be wary of this and should consider ways to make the apprenticeships route attractive to women to improve on these figures.
Employability and recruitment
Employability has become one of the most scrutinised aspects of a university education in recent years. Outcomes remain king. The ‘graduate’ outcomes will have to be measured after the first iteration has been completed, however the strong employability outcomes already found for higher level apprenticeships could be indicative of what these results may show. Employer confidence in degree apprenticeships could also be indicative.
Given the government’s plans to build an industrial strategy focusing on technical education, it might be a given that degree apprenticeships will be publicly assessed by how many jobs they fill. Especially as employment forms part of the metrics measured by the Teaching Excellence Framework and degree apprenticeships fall within the scope of undergraduate provision in the TEF. They may also be assessed in terms of social mobility and equalities data, when considering variations in earnings.
However, there could be an unintended negative consequence for the success of employability within degree apprenticeships if they become a viable alternative for students. By providing such a direct route to employment, the relative employability of traditional graduates could worsen. For example, would it be harder for an accounting traditional graduate to get a job compared to an apprenticeship with the same level qualification but more work-based experience?
The apprenticeship levy is also expected to play a significant part in restructuring the way employers recruit. A recently released report from the IFS proposed that the levy could also lead to reduced physical and human capital of workers, which in turn would lead to lower wages. The OBR expected the additional costs of the levy would have a cumulative reduction in average earnings by 0.3% by 2020-21 as employers pass on the new cost to employees. According to a recent High Fliers report on the graduate recruitment market, a small number of graduate employers have also announced that, due to the benefits of the apprenticeship levy, they will be reducing numbers of graduates in place of larger school-leaver recruitment.
The IFS explains that for employers, the combinations of not having to pay National Insurance Contribution on the earnings of apprentices under 25, or non-apprentices and the lower national minimum wage for apprentices, mean it is significantly cheaper to hire an apprentice as opposed to a non-apprentice under 25.
Degree apprenticeships could widen participation to a university education, but if take-up once the levy comes into place is anything like it is at the moment, we shouldn’t expect them to have a transformative impact on social mobility.
Additional reporting by Team Wonkhe.