Apprenticeship levy: the latest picture

Source: RTM April/May 2018

Mark Holmes, head of membership and development at NSAR, describes the current resources available to the rail industry to ensure companies of all sizes are taking full advantage of the apprenticeship levy.

The need to have highly-skilled individuals in the UK workforce now and for the future has never been more prevalent. This is demonstrated by the government commitment to create three million apprenticeships by 2020.

The loss of skill and experience is an imminent threat to the economy. The rail sector is set to experience a net loss of 50,000 individuals to retirement alone. Furthermore, with Brexit the UK is likely to experience a loss in people due to changes in citizenship and EU policy. In short, the loss of skills and experience will be significant, but the focus on apprenticeships can certainly be said to be part of the solution.

Since the apprenticeship levy was introduced in April 2017, apprenticeships in many sectors have declined by up to 40% when compared with the previous year. Almost 20,000 companies are affected by the levy, but the system has faced criticism as it is deemed too complex for smaller companies to navigate, and not flexible enough as it cannot be used to pay for travel and accommodation costs.

Nevertheless, the rail industry has seen a fourfold increase in levy-funded apprenticeships over the last year. For example, more than 1,000 apprenticeships have now been created since the start of the Crossrail programme in 2009.

The UK rail industry needs to recruit about 4,500 apprentices each year. NSAR estimates that the rail sector pays about £35m into the levy annually. At least half the rail workforce (250,000) is covered by levy-paying employers. The sector is currently drawing down approximately one-fifth (20%) of the amount it pays in. In CP6, rail is expected to pay between £175m and £190m into the levy. However, many say that a major reason for the decline is that many employers haven’t yet grasped or understood the concept of the levy. 

Some large employers within the rail industry, including Network Rail, TfL, Siemens, Thales and Balfour Beatty, have seen their apprenticeship programmes heavily oversubscribed. Competition amongst rail companies with a high brand recognition is fierce. NSAR is acutely aware of this and henceforth developed NSAR-Connect. This is a unique rail placement service which enables re-deployment, retention, attraction and development of enthusiastic candidates, and connects them with potential employers.

There is good demand for apprenticeships in rail, but fundamentally not enough apprenticeships are being offered. The apprenticeship system can be challenging for all employers in every industry.

In further anticipation of this, NSAR has brought together top-quality FE colleges across the country to work with the industry to deliver rail apprenticeships, creating the National Training Partnership. One element of this is the National Network of Colleges – geographically selected, these accredited colleges offer quality courses across the country which deliver rail apprenticeships in partnership with employers. NSAR also offers advice to help understand the complex rules and funding requirements.

We have also been working with the Institute of Apprenticeships and various transport and engineering trailblazer groups on the development of new rail and transport-related apprenticeship standards and relevant endpoint assessment plans. Our understanding of the current apprenticeships landscape and team has allowed us to work with employer groups on standards covering bus, coach and tram employers in the development of Level 2 Operative to Level 7 Engineer Degree.

These new apprenticeship standards will be more flexible and focused to address current and future business needs, and embrace the scale of technological and operational change faced by the transport industry. NSAR is at the forefront, and has subsequently launched an Apprenticeship Standards Support Service. This is available not only to training providers, but also for anyone needing information, clarification or guidance regarding any aspect of rail apprenticeships. We are particularly interested in hearing from smaller companies who might wish to collaborate on apprenticeships.

Overall, apprenticeships are vital to upskilling the workforce, and collaboration between employers, training providers, and the government is the only way that the levy will work and the right apprenticeships are available. NSAR will continue to remain vigilant and active so that this comes to fruition in the coming years.


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