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Training leaders warn thousands of apprenticeships have been put at risk

By John Corser | Business Picks | Published:

Thousands of apprenticeships and hundreds of jobs are at risk after the Government refused to guarantee funding for independent training organisations during the coronavirus outbreak, a senior executive has warned.

BCTG executive director Chris Luty

Chris Luty, chief executive of Oldbury-based BCTG, one of the Black Country’s leading workforce training and apprenticeship organisations, is now pleading with local MPs to back a call for a rethink at the Department for Education.

While the DfE and its Education Funding Skills Agency have said they will continue to fund apprenticeships, youth training and adult education through the FE college sector, hundreds of independent providers have been told there will be no similar support for them.

Private training providers work with employers to provide apprenticeship training in class and in the workplace, with most of their funding coming from the DfE. They currently handle seven out of 10 apprenticeships.

But the DfE says its policy "does not allow payment for services in advance of delivery", so private providers will not be paid until training has taken place, despite on-the-job training being put on hold because of Covid-19.

Mr Luty said: “Many private providers are at imminent risk of failure, which in turns means many thousands of apprentices will lose their jobs and training.”

He added: “Training providers are being signposted to the Treasury’s business support measures but for us, these won’t work by themselves.

“Loans are not useful because with employers stopping apprenticeship programmes, we have no income coming in to repay them and cover our ongoing overheads. Furloughing has the problem that staff are required to stop work when we would like them to be trying to maintain as much apprenticeship training and assessment as possible using online resources along with other support and training they could be offering employers and learners.

“Employers in the constituency both large and small have understandably stopped all new apprenticeship starts which means no government funding flows to us.”

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“Also, the inability to gain access to apprentices to assess them for completion of their programmes means that we are denied the 20 per cent of apprenticeship funding which is only paid to us on a successful completion.

“In short, we and other providers are immediately facing immediate and very serious cashflow challenges that the Treasury’s package can’t solve.”

The acute crisis created by the Department for Education’s denial of funding is in sharp contrast to the support provided by West Midlands Mayor Andy Street and the West Midlands Combined Authority, responsible for the region’s £126 million adult education budget, said Mr Luty.

“We contract with WMCA to support wider adult education training, both for the unemployed and upskilling those in work. WMCA taken a totally different approach, which is immensely helpful and gives some stability in funding.”

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The authority is continuing to fund training organisations, based on an average of their monthly earnings over the previous three months, while encouraging them to increase online training methods.

“As the other devolved authorities have taken a similar position, this clearly leaves DfE/ESFA out on a limb, taking such a draconian stance,” said Mr Luty.

He and other training organisation leaders are now trying to recruit local MPS to help lobby Education Secretary Gavin Williamson to reconsider their funding during the coronavirus crisis.

Mr Luty added: “We urge that the Education Secretary reverses his decision and guarantees use of the already allocated DfE apprenticeship budget to stop apprenticeship opportunities disappearing across the country – in many cases, for a very long time.”

John Corser

By John Corser
Business Reporter - @JohnCorser_Star

Express & Star Business Editor at head office, Wolverhampton. Welcomes all news of companies and business organisations.

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