A couple of weeks ago in the House of Lords, a short debate took place on the theme of Apprenticeships under the guise of a couple of questions from David Blunkett (now Baron Blunkett of Brightside and Hillsborough). There were several responses from other members of the Lords including this one from  Liz Redfern who was leader of North Lincolnshire Council and is now a Conservative Peer (Baroness Redfern of the Isle of Axholme).

“My Lords, the success of SMEs is critical to the UK economy, as is a thriving apprenticeship system. For our SMEs, a central fund enables the Government to fund 90% of the training programme, which the Minister has alluded to, leaving only 10% of the costs to be covered by businesses themselves. Unfortunately, there is still a poor level of understanding of the levy and how it can be spent among employers. Does the Minister agree that, although there has been a drop in apprenticeship starts, calling the new system a failure is not only a huge simplification but writes off the new apprenticeship system before it has even had a chance to embed? What apprenticeships need right now is positivity and action.”

What Baroness Redfern has said is right on many levels. However the only gap in her comment is that the reason for the poor level of understanding is that the Government has so far done almost nothing to communicated about this funding to SME employers. The additional challenge is that the shape and nature of the apprenticeships being proposed fit the Governments own idea of what SMEs require, rather than reflecting the needs of these businesses. The truth is that a large business can help shape the apprenticeship that they are signing people up to, simply by discussing their needs with the training provider. Few training providers would knock on the door of a large business without first carrying out some research. However when they are then being asked to offer a solution to SME’s they will not be able to justify spending the time needed to do the same. Even when an SME explains their requirements in an articulate manner, the provider is at best going to try to offer a hybrid scheme between what is currently available off the peg and what the SME is calling for.

Taking the first half of the opening sentence of Liz Redfern, “the success of SMEs is critical to the UK economy” she is absolutely correct. Indeed one of her colleagues (Baroness Garden of Frognal) later on in the debate stated this very clearly:

“My Lords, a recent report showed that the UK skills shortage is leading to an estimated £7.3 billion annual loss in sales to SMEs, equivalent to approximately 250,000 jobs.”

SMEs are made up of micro, small and medium sized businesses, and generally speaking only the larger of the medium sized businesses have the time or the capacity to engage in helping to shape apprenticeships and challenging government policy. Yet the strength of the sector lies in the micro and small businesses. However many of them are different in their approach and finding common ideas and needs will require investment by the Government to spend the time doing what the training providers already do with large businesses.