IFS warns apprenticeships policy risks being 'poor value for money'

31 Jan 2017

The Institute for Fiscal Studies (IFS) has warned that the government’s target to increase the number of apprentices risks being ‘poor value for money’.

In a report on the matter, the think tank suggested that increasing the number of apprenticeships could ‘come at the expense of quality’.

The IFS also warned that the target could diminish the apprenticeships ‘brand’, changing it into another term for training.

From 6 April 2017, the government will introduce its new Apprenticeship Levy, which will bring significant changes to the funding of apprenticeships for all employers.  

The Levy forms part of the government’s target to encourage the creation of three million apprenticeships in England by 2020.  

However, the IFS has warned that the focus on targets could ‘distort policy’ and ‘lead to the inefficient use of public money’.    

The Institute recommended that the government move away from ‘arbitrary targets’, advocating a more gradual expansion in the number of apprenticeships and a ‘stronger focus on quality’.

Neil Amin-Smith, Research Economist at the IFS and co-author of the report, commented: ‘We desperately need an effective system for supporting training of young people in the UK.

‘But the new Apprenticeship Levy, and associated targets, risk repeating the mistakes of recent decades by encouraging employers and training providers to re-label current activity and seek subsidy rather than seek the best training.’