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Volume 615: debated on Monday 10 October 2016

5. What assessment she has made of the potential effect of her Department’s proposed changes to apprenticeship funding rates on the take-up of apprenticeships. (906518)

The proposed apprenticeship funding policy is designed to support an increase in the quality and quantity of apprenticeships. Our proposals include incentives and support for employers and providers that will encourage the take-up of many more apprenticeship opportunities by people of all ages and backgrounds, giving many people their first step on the employment ladder of opportunity. We continue to engage with employers and providers, and we plan to publish the final policy shortly.

A recent National Audit Office report condemned the lack of contingency planning for apprenticeship funding reform. How does the Minister hope to address that?

We are busy with our plans to introduce the apprenticeship levy. By 2020, we will be spending more than double on apprenticeships, or £2.5 billion extra. We are well on the way towards achieving our target of 3 million apprenticeship starts by 2020, with over 500,000 starts in the past year alone.

Although I welcome the record number of people participating in apprenticeships in our country, will the Minister outline what steps the Government have taken to encourage more small businesses to offer apprenticeships?

My hon. Friend, who is a champion of apprenticeships in his area, will be pleased to know that, under the plans for the new apprenticeship levy, small businesses that hire 16 to 18-year-olds as apprentices will pay only 10% of the training costs. Furthermore, they and the providers will each receive £1,000. That will encourage small businesses to hire more apprentices.

I welcome the Minister to his place, and I welcome his commitment to social mobility, but is not the truth that he found this shambles—30% to 50% of apprenticeship funding is being cut for our most disadvantaged 16 to 18-year-olds—in the welcome pack in his in-tray? He knows that it is a shambles. Nearly a month ago, he and I spoke here to a full house of sector leaders and heard it from them. On the same day, the Prime Minister was caught on the hop when she said that she did not recognise the figures, and the chief executive of the Institute of the Motor Industry said that it was a looming car crash. With no proper impact assessment of these cuts, and with the Government’s credibility on the line, why one month later has the Minister still no solutions to these funding cuts?

I notice that the shadow Minister—I have great respect for him and am pleased to face him across the Dispatch Box—called his campaign “Save our apprenticeships”. We have been saving 2.5 million people on apprenticeships over the past five years. In 2014-15, in his own constituency, he had 1,040 apprenticeship starts, 218 under-19 apprenticeship starts and 10,500 people participating in further education. If that is not saving apprentices, I do not know what is. As I have said, the apprentice funding will be doubled to £2.5 billion. He is ignoring the increase in the STEM uplifts, the extra money spent on new apprenticeship standards and the £1,000 going to every employer and every provider when they hire a 16 to 18-year-old.