Ofsted annual report warns apprenticeship levy being spent on graduate scheme rebadging

Amanda Spielman has amplified Ofsted’s concern that too much apprenticeship levy funding is being spent on higher levels, which is squeezing out the recruitment of young people onto lower level programmes.

The chief inspector has raised the issue in her second annual report, published yesterday.

“We are concerned that in many cases, levy money is not being spent in the intended way,” she wrote.

“We have seen examples where existing graduate schemes are in essence being rebadged as apprenticeships. This might meet the rules of the levy policy, but it falls well short of its spirit.

“We hope the government will give greater thought as to how levy money can be better directed at addressing skills shortages.”

It follows yesterday’s FE Week exclusive which revealed the Institute for Apprenticeships is expecting an imminent levy over-spend, understood to be the result of higher per-start funding than first predicted, largely driven by the sharp rise in management apprenticeships with high prices.

Ms Spielman said today that along with the “sudden expansion in the number of providers offering apprenticeships”, the inspectorates “continues to be concerned about access to apprenticeships for the third of students who leave school without a full level 2”.

The number of under 19s starting an apprenticeship has been in decline for the last two years, falling from 78,500 last year to 62,000 this year alone.

“In contrast, the number of learners starting a higher apprenticeship has been growing year-on-year since 2011/12, increasing by around 10,000 apprentices a year for the past four years,” the chief inspector said.

She added that while Ofsted does “welcome” more apprenticeships at higher levels, “particularly when there is clear progression in an occupation from level 2 to degree level”, it will not address skills shortages in England if they are done at the expense of getting young people onto the programmes.

You can download a copy of the report here: Ofsted Annual Report 2017/18