With permission Mr Speaker, I would like to make a statement about apprenticeships. As you know, Mr Speaker, I am evangelical about apprenticeships. We do not always agree with each other on every question, but I know that to a woman and to a man, all my right hon. and hon. Friends share this passion.
We believe in apprenticeships, because they are one of most powerful motors of social mobility and productivity growth. An apprenticeship represents opportunity, aspiration, ambition—things that we Conservatives cherish. Apprenticeships make our companies more competitive. Some 70% of employers report that apprentices help to improve the quality of their product or service. They offer people a ladder to climb, with both higher pay and a sense of personal fulfilment at the end of it. A level 2 apprenticeship raises people’s incomes by an average of 11% three to five years later. A level 3 apprenticeship delivers a 16% boost.
Apprenticeships improve the diversity of the workplace: 53% of the people starting an apprenticeship in 2014-15 were women; 10.6% were from a black or other minority ethnic background, up from 8% in 2009-10; and 8.8% had a disability or learning difficulty. An apprenticeship can take you anywhere. Sir Alex Ferguson did one. So did Jamie Oliver. And Karen Millen. And Sir Ian McKellen. So, too, did the chairmen of great businesses such as Crossrail, WS Atkins and Fujitsu.
The Government have great ambitions for our apprenticeships programme. In the previous Parliament, 2.4 million people started an apprenticeship; by 2020, we want a further 3 million to have that opportunity. We do not just want to see more apprenticeships; we want better apprenticeships in more sectors, covering more roles. The first thing we need to do is persuade more employers to offer apprenticeships. At the moment, only about 15% of employers in England do. In Germany, the figure is 24% and in Australia 30%.
We are therefore introducing a new apprenticeship levy that will be paid by all larger employers—those with an annual payroll bill of £3 million or more. This will help us to increase our spending on apprenticeships in England from £1.5 billion last year to £2.5 billion in 2019-20. Employers who pay the levy will see the money they have paid for English apprenticeships appear in their digital account. They will be able to spend it on apprenticeship training—but only on apprenticeship training—and as my right hon. Friend the Chancellor has emphasised, employers will be able to get out more than they put in.
We are also making sure the public sector pulls its weight and follows the fantastic example of our armed forces, which, between them, employ 20,000 apprentices at any one time. We plan to introduce a new target for public sector organisations employing over 250 people in England. They will be expected to ensure that at least 2.3% of their staff are apprentices. We are using the Government’s power as a customer too. Procurement rules now stipulate that bidders for central Government contracts worth more than £10 million and lasting over 12 months must demonstrate their commitment to apprentices.
We are not only committed to greater quantity; we want to see better quality too. We have already stopped the short-term, low-quality, programme-led apprenticeships developed by the last Labour Government. They made a mockery of the concept and tarnished the brand. We are now asking groups of employers to develop new apprenticeship standards that will help them fill the skills needs created by new jobs and new industries. Some 1,300 employers are involved in this process, and we have published 210 new standards so far. A further 150 are in development. We are also establishing a new employer-led institute for apprenticeships to approve these new standards and ensure that quality is maintained.
Sixty of these new standards are higher and degree apprenticeships. We want everyone making a choice about their next steps after the age of 16 or 18 to know that the decision to do an apprenticeship is not a decision to cap their ambition or turn down the chance of a degree. It is simply a decision to progress in a different way—to learn while they earn and to take a bit more time, to bring home a wage and avoid large student loans. Next week is National Apprenticeship Week. I hope that the House of Commons will today speak with one voice. Apprenticeships are for everyone and can take you anywhere. I commend this statement to the House.
I thank the Minister for limited advance sight of the statement. I suppose we should all be grateful, after the turmoil of yesterday, that it did not just turn up in manuscript.
What has turned up—if I can put it this way—is a dance of the seven veils. The Minister’s statement is simply a rehash of much of what was already said in the “English Apprenticeships” document. That is what concerns the sector: fine words butter no parsnips. The procurement rules he mentions are a pale shadow of what Labour proposed in its 2010 manifesto. Most crucially, there is no further clarity for universities, other areas and large employers about what their responsibilities will be. They want to know whether the levy will be extra money or a substitute for Government funding. Will it be extra resources or simply an Osborne payroll tax?
Will the Minister confirm how much he expects the levy to raise, and whether it will be more or less than the £1 billion he said he hoped to add to spending on apprenticeships in England? The Department was supposed to respond to the consultation on the targets for apprenticeships in public sector bodies by 4 March. Has it done so? When will he do so? There is confusion and concern among local government and others about who will be affected. Will he spell out in far greater detail how small and medium-sized enterprises will benefit from the process, and what does he have to say to the Chartered Institute of Taxation, which worries that smaller businesses will be unable to use their full £15,000 allowance?
The Minister has told us that he is evangelical about apprenticeships, but Members and the business sector want to know whether he will be too catholic in the definition. Perhaps he should avoid tarnishing his own brand by cheap politicking about the Labour Government, who set up both National Apprenticeship Week and the National Apprenticeship Service, and stop sounding like some old Soviet five-year planner on his tractor targets.
With concerns about the quality of these apprenticeships, will the Minister tell us who will supervise the operation of the apprenticeships levy? Will it be the Apprenticeships Delivery Board or the board of the institute for apprenticeships? What has he to say to the Chair of the Business, Innovation and Skills Committee, my hon. Friend the Member for Hartlepool (Mr Wright), who, I am told, said this morning, “No one knows what the apprenticeship levy is going to look like. It’s coming in in a vacuum of darkness, and I am concerned that it’s just a numbers game.”
What will the Minister tell the Public Accounts Committee, which is so concerned about the direction of his Department that it has recalled the Secretary of State and the permanent secretary for a second grilling before Easter? Finally, perhaps he would like to tell us how he expects to deliver the 3 million target and implement the levy over a very short period with the number of Skills Funding Agency staffing down by 40% since 2011, more cuts to come and an accelerated decline in the number of people in the National Apprenticeship Service?
It is amusing to be accused in a relatively short statement from the hon. Gentleman of being a Catholic, a Soviet planner and a dancer with seven veils. I will want to put that in my epitaph.
I will try to answer the hon. Gentleman’s questions. First, to be clear, in the last year of the last Labour Government, public spending on apprenticeship training was £1 billion. It is now £1.5 billion. By the end of this Parliament, it will be £2.5 billion in England. That is extra money in anyone’s book. Not a single education budget or, indeed, other public service budget is increasing as fast.
The apprenticeship levy will raise £3 billion in 2019-20, and £500 million will be needed to make adequate and fair contributions to the Scottish Government, the Welsh Government and the Northern Ireland Executive to fund, I hope, their apprenticeship programmes, but that is, of course, for them to judge. All the remaining £2.5 billion will be spent on English apprenticeships.
The hon. Gentleman asks how small and medium-sized businesses, which will not pay the levy, will nevertheless benefit from Government funding for apprenticeships. We expect them to carry on receiving Government money for apprenticeships in the same way as they do now. We do not expect all companies that pay the levy to use up all the money in their digital accounts, and there will be a great deal more money to go around, so we are absolutely determined that the level of apprenticeships provided by SMEs will continue as now.
The operation of the levy as a tax is obviously in the hands of Her Majesty’s Revenue and Customs. The operation of the digital system used to give employers control of the apprenticeship levy that they have contributed will be the Skills Funding Agency’s responsibility. The institute for apprenticeships will, as I have described, have complete responsibility for overseeing standards and quality control.
The hon. Gentleman and, indeed, the Chair of the Business, Innovation and Skills Committee—I look forward to hearing from him, no doubt—would like answers to many more questions. They will have to wait just a little. The Chancellor will make his Budget statement next week, after which more technical details will be provided, so that everyone knows well in advance how the levy will work.
I welcome the Minister’s statement today. Since the election, more than 4,000 apprenticeships have been created in my constituency, Aldridge-Brownhills. Will the Minister join me, particularly in the run-up to National Apprenticeship Week, in thanking all the businesses, organisations and our local colleges that have helped to deliver those apprenticeships? Will he assure me that we will continue to ensure that the public sector plays a greater role in giving new opportunities to young people and women?
It is excellent news to hear how many apprenticeships have been created in my hon. Friend’s constituency. She is right that the public sector to date has not been pulling its weight—its proportion of apprentices is not the same as that among employees as a whole—so we will impose the target on larger public sector employers. Public sector organisations will discover what private sector ones know: apprentices help them to do a better job.
I thank the Minister for an advance copy of his statement. I am a little surprised at the timing, given that apprenticeship week in Scotland was last week rather than next week, so it would have been beneficial for us to have the statement then. The Scottish Government have recognised the importance of apprenticeships for some time. Indeed, the Scottish Government are committed to creating 25,000 modern apprenticeships a year, which encompasses 80 different types of modern apprenticeships.
With that in mind, I would be interested to hear what consultation has taken place with the Scottish Government on this important issue. I do not doubt the Minister’s good intentions to create apprenticeships—we should all welcome that—but I question the method used to raise the money and its sustainability. The introduction of an apprenticeship levy remains a matter of fundamental concern for us. It encroaches on our devolved responsibilities and is causing concern for employers; it has also come under criticism from a wide number of organisations, including the CBI and the Chartered Institute of Taxation. The levy will have a knock-on effect for apprenticeships in Scotland, so we call on the UK Government to consider the economic impact that this measure will have.
I would like the Minister to reflect on the fact that Police Scotland will have to pay out up to £4.5 million a year on the UK Government’s plans for an apprenticeship levy, prompting warnings that finding extra cash savings will be “virtually impossible”. The UK Government have still to provide clarity on how Scotland’s share of the levy raised will be calculated and transferred to the Scottish Government. When will we get that clarity from the UK Government?
It is, of course, great news to hear about the Scottish Government’s commitment to apprenticeships. Because they will now receive substantial extra revenue from their share of the revenue raised by the apprenticeship levy, I hope they will be able increase from 25,000 apprenticeships a year to a rate that is more equivalent to the one that we have an ambition for in England. The hon. Gentleman mentions the problems faced by Police Scotland. On the whole, it would be fair to say that the level of the apprenticeship levy is not the greatest problem facing Police Scotland.
I thank my hon. Friend for agreeing to come down to Weymouth shortly to open our third apprenticeship fair at Weymouth College. The new principal, Nigel Evans, has just been appointed, and I greatly look forward to seeing him. May I add one slight note of caution? As a Conservative, I do not like levies—instinctively—so let us call it a tax. Has the Minister had any response from big business about its fears for the future if, heaven forbid, a socialist Government ever took over, because this could be an area of taxation that they might want to increase for other reasons?
Any excuse to go to Weymouth—and I am your man, Madam Deputy Speaker. I am grateful to my hon. Friend for inviting me. Like him, I feel an innate scepticism about a new levy on business, but if we talk to large businesses, particularly the ones that are investing in apprenticeships, we find that they say that some of their competitors do not, which restrains the overall level of investment in apprenticeships, because some are taking a free ride on the rest. We are introducing this levy to ensure that all large employers are making this investment, but we are giving them control of the money, so that they can spend it on the apprenticeships that benefit them. If we have to have a new levy—I agree that we should do so only as a last resort—it is best to have one that employers control and from which they can benefit.
It is always nice to see the Minister and it is always welcome to discuss apprenticeships in this place. The Enterprise Bill mentions the public sector apprenticeship targets. Given that we discussed that Bill both yesterday and the day before, why was not the public sector apprenticeship target mentioned then? Will there be a need for new legislation? The statement referred to the need to persuade more employers to offer apprenticeships, and the levy will be the means by which this happens. Will the Minister provide more information—any information—about the 98% of employers who will not pay the levy? In a previous response, he seemed to suggest that nothing would change or that large employers would somehow benevolently give away this levy receipt. Clarity is crucial for the success of the 3 million apprenticeship target. Will he provide more clarity, and if not, what is the point of his statement?
First, I am grateful to the hon. Gentleman for returning to the subject of the public sector target, because it gives me an opportunity to respond to one of the questions asked by the hon. Member for Blackpool South (Mr Marsden). It was not the case that we were due to respond to the consultation on the public sector target by 4 March; rather, it was that the consultation closed on 4 March. The hon. Gentleman will understand that it takes more than six days to go through all the consultation responses and decide on our response.
We do not need legislation—I mean primary legislation —to create that target, which is why it was not necessary to include provisions in the Enterprise Bill. I understand the hon. Gentleman’s impatience—to some extent I share it—to get the details on how exactly the levy will work and the new digital accounts system will work as it goes out to all employers. I can assure him that more than 12 months’ notice will be given to everyone. We will publish very soon, but he will be aware that there is a Budget next week and he will also know that it would be a career-limiting move for me to anticipate the Chancellor in his Budget statement.
The Prime Minister came to my constituency last August to launch the consultation on the apprenticeship levy. I would like to support the Minister in looking to increase quality by asking employers to make their own choices through the Digital Apprenticeship Service. Will he update us on progress towards making that system ready?
Yes, and this provides an opportunity to put on record my thanks to my hon. Friend the Member for Stratford-on-Avon (Nadhim Zahawi), who is unfortunately not able to be with us today, but who is the Prime Minister’s adviser on apprenticeships. He has a great deal of experience in business of leading major technology projects. He has been immensely helpful in working with the Skills Funding Agency and officials in my Department to create a system that will be simple and user-friendly for businesses, providing them with absolute transparency over how much money they have contributed and what they can spend it on. This will also enable training providers to continue to take responsibility for ensuring that the training they have promised to deliver is in fact delivered.
As the Member responsible for the Apprenticeships and Skills (Public Procurement Contracts) Bill in 2013, let me welcome the Government’s conversion to using the benefits of public procurement to secure additional apprenticeships. I note that it was Conservative Back-Bench Members who talked out my Bill when it was going through the House of Commons. The Minister said in his statement that the public procurement rules now stipulate that bidders for Government contracts must demonstrate their “commitment to apprenticeships”. Precisely what does that mean?
I would like to pay tribute to the hon. Gentleman’s leadership on this issue. Sometimes Government Members take a while to be persuaded of the merits of an intervention, but once persuaded, we are absolutely determined to fulfil it. The hon. Gentleman is right to ask about the mechanics. We have been advised—not least by Terry Morgan, the chairman of Crossrail, who led the way by instituting a similar sort of expectation for all subcontractors to Crossrail— that given the variety of public procurement such as infrastructure projects and services, it was dangerous to impose a single mechanism of either a number of apprentices per £1 million-worth of spend or a percentage of employers on a project. We thus decided to mix and match to make the right requirement depending on what the procurement process is. We will be transparent about how we are going to achieve that.
I congratulate my hon. Friend on his statement and I agree with him. I, too, am an evangelical supporter of apprenticeships. We in the office have an apprentice, young Jake Carruthers, who is doing an amazing job. Does my hon. Friend agree that apprenticeships perform a valuable role in protecting our country, not only in maintaining and enhancing our sovereign defence capability, but through the large number offered throughout the armed forces?
The armed forces really are leading the way on this, and they have done so for a very long time. I would like to put on record my thanks to my right hon. Friend the Secretary of State for Defence, who takes a particularly keen interest. The armed forces are confident that, between them, they will be able to create 100,000 apprenticeships in the life of this Parliament, contributing massively to our target. As so often, where the armed forces lead, we should follow.
The Minister should have the grace to acknowledge that it was a Labour Government that saved apprenticeships from the oblivion to which his party’s previous Governments had consigned them. Apprenticeships are certainly an example of the kind of intervention whose value his party has been slow to acknowledge, and I am glad that he is now doing that. He will be aware of the concern among employers that his 3 million target will be achieved only if the quality of what is on offer is reduced further. Can he give the House some reassurance on that point?
I am happy to place it on record that it was, mainly, Lord Mandelson who reintroduced the idea of modern apprenticeships, but I will not shy away from pointing out that some of Labour’s policy measures led to programme-led apprenticeships in which the apprentice did not need to have an employer and which lasted only a few months. That rather undermined the quality and the brand of the programme, but we have got rid of those apprenticeships. We have now introduced some simple minimum standards. An apprenticeship must be a job: the apprentice must have an employer. It must last for at least 12 months, and it must have at least 20% off-the-job training content. That is why in some categories we had a short-term dip in the number of apprenticeship starts at the beginning of the last Parliament: we were getting rid of some of the slightly Mickey Mouse apprenticeships that had been on offer.
When will the Institute for Apprenticeships be up and running, and will it have a role in resolving any problems that might arise with apprenticeships?
The Institute for Apprenticeships will come into being in a kind of shadow form this spring, after which it will have 12 months to start taking over its responsibilities before formally taking over in April 2017. Specific complaints about training provision, which sometimes occur, will continue to be dealt with in part by Ofsted through its inspections and in part by the Skills Funding Agency, which will manage the relationship with training providers. However, broader complaints about employers or particular apprenticeship standards will indeed be the responsibility of the Institute for Apprenticeships.
Last month, it was announced that 1,080 jobs were to be lost at Bombardier and that its three-year modern apprenticeship programme would suffer as a result. That programme involves a level 3 NVQ and it is one of the most impressive apprenticeship schemes in Northern Ireland, if not in the whole of the United Kingdom. The Minister has indicated that some money has been set aside. Can he tell me what discussions he has had with his Northern Ireland counterpart on establishing some kind of co-operation between Northern Ireland and the mainland UK on apprenticeships in the engineering and manufacturing sectors?
This is a devolved matter, as the hon. Gentleman knows, but I am happy to reassure him that I have had meetings with the Ministers responsible for apprenticeships in all the devolved Administrations. We have made a commitment to meet every six months to talk through the issues, to learn from each other what works and what does not work, and to ensure that the introduction of the levy actually boosts apprenticeship activity in all parts of the United Kingdom, not just in England.
I commend my hon. Friend for his statement. Last Friday, I was pleased to host an apprenticeship and jobs fair in my constituency. Will my hon. Friend join me in thanking employers based in Crawley, including Virgin Atlantic, CGG and B&CE the People’s Pension, for sponsoring the apprenticeship fair and for all that they do in this sector?
I am delighted to do that, not least because the employers that my hon. Friend has mentioned demonstrate that apprenticeships are no longer narrowly confined to the traditional industries of construction or engineering. People can be apprentice lawyers, apprentice accountants or apprentice digital creators. Some day, they will probably even be able to be apprentice politicians.
The Minister will know that 96% of apprenticeships are delivered at levels 2 and 3. Clearly it is very good that young people and others are getting those qualifications, but is he confident that enough apprenticeship opportunities exist at level 4 and above, to provide clear apprenticeship progression routes for the young people who want them?
Also, I want briefly to point out to the Minister, whom I have some time for, that a lot of us on this side of the Chamber—not least my hon. Friends the Members for Blackpool South (Mr Marsden) and for Hartlepool (Mr Wright), who is now the Chair of the Select Committee—worked very hard under the previous Labour Government to rescue apprenticeships from oblivion. We created some very good quality apprenticeships, which the Minister can now build on, so perhaps it would be better not to make this a party political issue.
Funnily enough, I was an apprentice politician to the hon. Lady when she was the Planning Minister and I was shadowing her. I learned a great deal in the process. She is right to say that there are currently too few higher and degree apprenticeships; we would like to see many more of them. We are making reasonably good progress, however. There were 19,800 starts on higher apprenticeships in 2014-15, which was 115% up on the previous year. Degree apprenticeships are a relatively new concept, but we are making progress and more than 1,000 people have now started such apprenticeships. We have much further to go, and there will always be more level 2 and 3 apprenticeships, but we want everyone who is doing those apprenticeships to be able to look up and see the higher and degree apprenticeships that they could move on to. I am happy to pay tribute to the hon. Lady’s role, and that of the Chairman of the Select Committee and the hon. Member for Blackpool South (Mr Marsden) in reviving the idea and the practice of apprenticeships.
I thank the Minister for meeting me and colleagues from the Humber region, along with my hon. Friend the Minister of State, Department of Energy and Climate Change, to discuss the establishment of a national wind college in the region. Will he reaffirm the Government’s commitment to giving our young people in the region the maximum opportunities to take advantage of the jobs that are being created in the offshore wind sector?
Absolutely. One of the reasons that we have established the national college programme is to have colleges that can teach the higher and degree apprenticeships, in particular, for which we are so ambitious. The only reason that there is not already a national college for wind energy in my hon. Friend’s region is that the partners were not quite ready, but we are very happy to work with them on bringing a proposal to the Chancellor once they are ready.
I should like to start by paying tribute to my apprentice, Callum Morton. If the Minister is doling out praise for those who have contributed to apprenticeships, I hope that he will add Vince Cable to the list, because he played a fantastic role in government. This Government have decided to include in the definition of payroll the bonuses paid to employee owners, although dividend payments to shareholders are not covered. Will this mean that companies such as John Lewis and other employee-owned companies will end up paying more in the levy? If that is the case, will it not act as a disincentive to that model of enterprise?
I am happy to pay tribute to the work of the former Secretary of State, with whom I worked. He managed to increase the budget for apprenticeship training at a time when most other budgets were not increasing, and that was an admirable feat. I can give the right hon. Gentleman a general answer to his specific question, but I do not want to tread on the territory of Her Majesty’s Revenue and Customs so I will write to him with further details. The general answer is that the levy will be applied to all PAYE pay, but I will get a further answer to him, either from me or from an HMRC Minister.
I welcome the Minister’s statement this morning. I am a big fan of apprenticeships and I am extremely proud of the fact that in Rochester and Strood we have produced 7,410 apprenticeships since 2010, the fourth highest figure in the south-east. This week, I was at MidKent College, which has had more than 100 new engagements with employers since last September. Can the Minister assure me that the Government will continue to work with our colleges, especially in places such as Rochester and Strood, to ensure that we have the correct provision in place and that we continue to develop it in order to keep up with the demand in constituencies such as mine?
My hon. Friend makes a very good point. I had a meeting with college leaders just the other day. At the moment, colleges secure only one third of the money that is spent on apprenticeship training. As we have heard, that money is going to increase substantially. I have challenged college leaders on this and I will do everything in my power to help them to secure two thirds of that funding, because a great further education college can be the heart of a community that is investing in young people and local employers.
I welcome the statement from the Minister. We need to encourage companies to take on more apprentices. I am sure that he will welcome the fact that the further education colleges in my constituency are moving to a level 3 apprenticeship right through to diploma level, which is very welcome. Will the Minister tell us just how often his Department meets business and FE colleges to encourage more apprenticeships across the UK?
Obviously I meet English business, employers and colleges a great deal, but many of those employers are also employers elsewhere in the United Kingdom and want to be able to have integrated apprenticeship programmes, so it is extremely important—I give a commitment to the hon. Gentleman about this—that I work with the devolved Administrations to ensure that apprenticeship standards are recognised in all parts of the UK and that we learn from each other.
I welcome the Minister’s clear passion for using apprenticeships to spread opportunity and to raise aspiration in our nation. Tomorrow I am attending an event hosted by the ancient company of fellmongers. Will he join me in commending the fellmongers for returning to their medieval roots and supporting the creation of dozens of local apprenticeships, thus helping Richmond to become one of the best-performing constituencies anywhere in the United Kingdom?
One of the curious things about this job is that one discovers occupations that one has literally never heard of. I have to admit that I still do not know what a fellmonger is. I am sure that I will find out, and perhaps one day I can join an apprentice fellmonger and understand the trade that he has learned.
I thank the Minister for his statement. May I point him to a survey that was released not so long ago by the Department for Business, Innovation and Skills that showed that only 9% of young people doing a level 2 qualification were doing so for the first time? He said that most of his agenda was about social mobility, but how can that be compatible with the fact that so few people are doing that level qualification for the first time, and that so few of them are coming out with a higher level qualification than they went in with in the first place?
The hon. Gentleman is right to point out that there is a problem with people starting courses and not completing them, fundamentally because those courses were inappropriate for them. It is something that we need to tackle, but it is more a subject that we are tackling through the panel that Lord Sainsbury is chairing, which is looking at establishing much clearer and more directive routes through technical education so that a person at 16 starts a course that is right for them, that they will complete and that will lead them—I hope—on to a great apprenticeship.
A total of 370 new apprenticeships were started between August and October last year in Cannock Chase, which put us at the top of the tables in Staffordshire and shows that local businesses are really embracing apprenticeships. Does my hon. Friend agree that involving employers in the design and standards of apprenticeships will mean that apprentices get the skills that businesses are looking for? Will he confirm that the employers involved are from a broad range of sectors so that everyone’s requirements are met?
My hon. Friend is absolutely right about this. It is extremely important not only that employers are in charge of developing standards to ensure that those standards are directly relevant to current occupations, but that we do not involve just the large employers that have human resources departments and senior managers who can go to meetings to help to develop those standards. Before every standard is approved, we insist that small and medium-sized employers in the industry support it.
I welcome the Minister saying that he meets his colleagues in the devolved Administrations on a six-monthly basis. Can he provide us with an estimate of how much money is likely to be allocated to the Northern Ireland Executive on a proportionate basis as a result of the increase in the apprenticeship levy?
The hon. Lady tempts me towards the edge of the abyss, but I can point out to her, because it is a matter of public record, that the apprenticeship levy is due to raise £3 billion in 2019-20, £2.5 billion of which will be spent on English apprenticeships, with the rest going to the devolved Administrations. I cannot tell her how that divides up, but the Chancellor will have more to say on the subject quite soon.
I wholeheartedly support the Government’s promotion of apprenticeships. I have been in discussions with many local businesses, schools and colleges about the value of apprenticeships and the opportunities that they offer young people. Although many businesses, such as the huge accountancy firm Albert Goodman, get it, many really do not. To address the lack of understanding about the matter, I am holding an event, to which I invite the evangelical Minister so that he can spread his passion to help the economy.
I would be delighted to come. This afternoon, I am going to Keighley so that I can attend an equivalent event tomorrow morning that has been organised by my hon. Friend the Member for Keighley (Kris Hopkins). I would be delighted to return to the west country, where I am from.
As part of my apprenticeship as an MP, I have just discovered that a fellmonger is a dealer in hides and skins. Is that right?
On to the serious stuff. The Minister said that deciding to take on an apprenticeship was a way of avoiding large student loans. Given that it is his Government who have imposed these large loans, would not another way of helping our young people to avoid them be for the Government to rethink replacing student maintenance grants with loans, or will he simply accuse me of shroud waving?
Now that I know what a fellmonger is, I trust that my hon. Friend the Member for Richmond (Yorks) (Rishi Sunak) will be able to procure a sheepskin coat for me when I come to visit his local fellmongers.
On the hon. Lady’s question, we want young people to have the choice of taking a full-time university course, with the understanding that they will have to fund that through student loans, which they have to pay back only if they earn more than £21,000, but they get all the university experience and the enrichment that comes from that. We want to place no cap on the number of people who decide to go down that route, but we also want another route for those people who find that they learn better by combining study and work, who want to earn a wage and who do not want that full-time university experience. This is about not telling people what to do, but offering them a choice.
I, too, welcome the great progress that has been made on apprenticeships to date and the overall positive tone from across the parties in support of them. The Minister mentioned broadening out apprenticeships. Can he tell me what progress has been made in encouraging apprenticeships in highly seasonal industries, such as farming and tourism?
I am grateful to my hon. Friend for that question, not least because I have been working with him and others on the possibility of establishing a pilot. Our minimum requirement that an apprenticeship has to last 12 months poses problems for very seasonal businesses, which will employ people for perhaps six or nine months, but not a continuous 12-month period. With the tourism industry, in which he is particularly interested, we are looking at establishing a pilot whereby an apprentice may be employed for 12 months out of a 15-month period. Hopefully, such an approach would encourage more apprenticeships in that and other sectors.
When the contracts were agreed for the £97 million Titanic signature project in east Belfast 10 years ago, social contracts and clauses for apprenticeships were novel—and welcome—but it quickly became increasingly clear that while the developer was happy to satisfy the required number of apprentices, it did nothing to sustain them. When apprentices became less inclined to remain in their apprenticeships or fell away, their numbers were not refilled, so the end result was that the apprenticeships were not completed as promised. How will the Minister ensure that, although an apprenticeship must last 12 months, those who enter the system go through and complete the process?
The hon. Gentleman raises an important concern. The truth is that most industries are telling us that they have a huge skills need, so unless an employer loses a big contract or does not find a new contract to replace one that comes to an end, it is relatively unlikely that they would want to lose an apprentice in whom they had invested quite a lot of training. Most apprentices do not reach their maximum productivity until after they complete their apprenticeship. I am hopeful that employers, and particularly those that are paying the levy every year, will want to create apprenticeships and invest in them, because they will want to use these skills for the long term.
Bristol South sends the fewest young people to university in the country, so I view apprenticeships as the key to aspiration and share the Minister’s evangelicalism. On his way back from Taunton in the west country, if he wants to stop off in Bristol South to see some of the work that we are doing, he will be most welcome.
Yesterday I asked the Prime Minister whether he had a delivery plan or was making up the policy as he went along; others have described it as iterative and agile. We await the details of the levy, of how the targets will work in practice, and of how colleges and other providers will be supported in their important work. Given that there is a desire to speak with one voice across the House on this subject, will the Minister please say a little more about when the delivery plan will be forthcoming?
The hon. Lady is right that we have many questions to answer, because we are making substantial policy interventions to try to ensure that we meet our targets for both numbers and quality. If those questions are not fully answered in April, I will be severely disappointed.
The Government are doing fantastic work in promoting apprenticeships. The Minister has been supportive in my constituency, having visited apprenticeship providers in the area, and he is welcome to come back. I am facilitating a meeting with local businesses to set the ambitious target of creating 50 new apprenticeships in 50 days. Apprenticeships represent a fantastic opportunity for young people to earn while they learn and make it far more likely that they will secure future employment. Will the Minister support me in my ambitious plan to get more people into good apprenticeships locally?
I congratulate my hon. Friend on embracing the cause and on setting herself and local businesses the target of creating 50 new apprenticeships in 50 days, which will be of vast benefit to the people of Morley and Outwood.
I am probably fairly unusual in this place in that I am a former apprentice. Indeed, I am now also a current apprentice, along with some of my new colleagues. I therefore welcome the Government’s commitment to creating another 3 million apprenticeships during this Parliament, in addition to the 2 million created in the previous Parliament. Businesses in my constituency are doing their bit. Will the Minister join me in congratulating and thanking some of the businesses that are creating opportunities for my constituents, such as Redroofs nursery, Rosegarth nursery, the Royal Southampton Yacht Club, and Crest Nicholson?
I am delighted to do that. My hon. Friend’s list included a house builder, which gives me the opportunity to point out that there are some fantastic apprenticeships at all levels of construction—not only bricklaying and site carpentry, but project management, architecture and the like—as well as in childcare and a whole range of industries. Apprenticeships are a solution to almost every skills need.
Finally, I call Mims Davies.
Thank you, Madam Deputy Speaker—and then there was one.
I welcome the Minister’s statement ahead of National Apprenticeship Week. Does he agree that it is vital that we encourage the participation of young women in traditionally male-focused apprenticeships? Will he join me in commending the 800 employers that are already working with Eastleigh College, which we have both visited and where I will be this evening? Such businesses are employing talented young women such as Maisie, who visited Parliament this week and is undertaking an advanced apprenticeship in construction and the built environment.
That is a great note to end on: a young woman who has decided that the opportunities for her future career lie in the construction industry and an advanced set of skills. Last week, when I visited Doosan Babcock, I was introduced to two young apprentice riggers who were moving unbelievably heavy pieces of power plant equipment, and both those young women were absolutely delighted with what they were doing.
I thank the Minister for his evangelical statement.