What should apprenticeship providers be doing to make the Apprenticeship Levy a success?

At the time of writing, the Apprenticeship Levy has been in operation for five months so far in 2017 and there has been plenty of posturing and turmoil within the sector. The Education and Skills Funding Agency (ESFA) have had their difficulties managing procurement processes for all funding streams; being heavily criticised by providers, membership bodies and the Further Education press.

Then came the ‘Learndirect sideshow’ on the publication of its long-awaited Ofsted report, bringing about a fresh wave of accusations, legal challenges and now an investigation by the National Audit Office. Further Education has recently exhibited plenty of infighting amongst the bigger players and some unsightly anger and emotion, railing at the powers that be with much blame being apportioned.

What elements of the Levy are working?

So… apart from what has gone wrong – what has gone right? What has the new funding regime achieved in 2017? What has actually worked very effectively and flown completely under the radar?

Firstly, the collection of Levy funds from employers.

To reiterate, large employers are already successfully paying a tax, wholly designed to be spent on apprenticeships. And further to that: HAVE YOU HEARD THEM COMPLAINING?

Certainly, on the Levy front, the tax seems to have been implemented fairly seamlessly – but how many employers truly understand what they are paying for? How to maximise it? What should providers be doing to take responsibility for educating employers on what is ultimately their future revenue?

Are employers unaware of the potential benefits of their Levy?

The news just in that ‘Barely half of eligible employers on the levy system’ should have sent shock waves through the sector. Who is to be blamed for this latest travesty? The ESFA? Theresa May? Brexit?

The time for scapegoating is past and although a blame culture may provide some comfort for those providers who have for example, gone into administration, providers need to see this as the opportunity that it is.

Some independent providers are no longer operational because they have failed to react to an employer-led market. With colleges in scope for a special insolvency regime in 18 months’ time then surely colleges, or at the very least those in visible positions charged with delivering apprenticeships, will be at risk too and culpable for the success of their institutions – it is time to take action.

Speaking as an expert in this field of Education and Finance, I can also speak from an informed position on the business side, working for a levy paying employer. We have had no contact at Nucleus from any apprenticeship providers and our training strategy remains exactly the same as before, because of that.

How can providers ensure that employers spend with them?

My question to colleges and independent providers is: What are you doing differently to be successful in this new market? If the answer is nothing, then I would advise that you reconsider that strategy and grab with both hands the opportunity in front of you.

Of course, there will be winners and losers – no one is denying the disruption that the new regime has caused, and the volume of smaller providers going into administration proves that old business models are no longer viable.

However, I still do not see the level of marketing or sales activity that needs to be in operation to educate employers and help them to spend their levy pot with you. This is one of the easiest sells that anyone in business ever gets to make because it is using money that has already been taken and cannot be spent in any other way.

A great opportunity to be positive

As an outsider looking in, is FE is still suffering from the overhanging malaise of introspection and an unhelpful victim mentality? This negativity is not the way to engage employers to embrace the brave new world of apprenticeships. It is the responsibility of providers themselves, as well as the other relevant bodies, to remind employers of the value of apprentices and skilling-up their teams by contacting them directly.

So back to the title of this blog; apprenticeship providers are definitely needed but at the moment I do not think the case been made well enough to employers to drive home the fact that they are not only desirable but essential.

We have a skills shortage in this country and businesses are struggling to recruit skilled staff.

Providers must be creative in their marketing approach to educate and consult their target market. It is essential that providers forge stable partnerships with organisations that can help drive their ambition long into the future.

There is money there waiting to be spent, there are sales to be made, there is growth and expansion to be achieved – as long as you want it enough. Do not be afraid. There is a great deal of support out there if you just ask for it. Taking strategic risks, in terms of becoming far more specialised and targeted in your sales approach, and financial risks to find the cash to realise your growth aspirations is essential.

You can get help with both if required; there are plenty of strategic consultants working in the sector to advise and support your sales strategy.

If you are looking for a finance facility to fund growth, smooth cash flow and provide a source of working capital, Nucleus can help with our unique range of solutions, tailored for the education sector.

We are happy to work in partnership with our Education Finance clients to help them grow their business through our professional network and via case studies and recommendations.

For support with sales and marketing please contact [email protected] for a consultation.