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Committee for Employment and Learning

Review of Apprenticeships: DEL Briefing

The Chairperson: I welcome Catherine Bell CBE, deputy secretary; and Ms Yvonne Croskery, head of the apprenticeship review team.  Ladies, you are very welcome.  Over to you.

Mrs Catherine Bell (Department for Employment and Learning): Thank you.  I look forward to the discussion. I have to apologise for my voice.  It is not sore, and it sounds worse than it is, but, if the questions get too hard, I will lose my voice. [Laughter.] I do not propose to spend a lot of time on an introduction because, as you know, the Minister gave a full statement on Monday.  The apprenticeship review has been the result of extensive consultation and engagement with a wide range of stakeholders and looking at best practice outside Northern Ireland.  We ended up with four big themes that really are the components of an apprenticeship:  increasing participation; the roles of partners; and ensuring quality.  Under those four themes, there are 32 key actions.  This apprenticeship is different from anything that has gone before, and we truly believe that it will be transformational not only for our young people and adults but for employers and the economy of Northern Ireland. 

I think that it would be better if I just left it for questions, if that is OK.

The Chairperson: OK.  Thank you very much, Catherine.  One of the things that was raised on Monday afternoon was — I understand why we are moving apprenticeships from level 2 to level 3 — what the Department is going to put in place for people who would have usually gone in at level 2.

Mrs C Bell: When we started this work, the Minister announced that he was doing a review of youth training and apprenticeships, but it was then decided that we needed to get clarity on what was going to go into apprenticeships before we turned our mind to youth training.  That is not to say that stuff is not happening on youth training, but the Minister is very determined that there will be an opportunity for all young people to progress to an apprenticeship.  The new youth training programme, when it is designed, brought to the Committee and debated, will allow progression from a level 2 to a level 3 apprenticeship.  So, there will be proper progression for those young people who are not just ready to take up an apprenticeship at level 3.  That is incredibly important.  We are working on that piece of work at the minute.

The Chairperson: Linked to that, one of the major employers in my constituency, which I was with last week, advertised for 50 apprentices.  Of the 720 people who responded, 120 were interviewed and 55 were eventually taken on. Even with that reduction, 30 of the 55 they took on still needed essential skills training.  So, 690 did not make it through to that, and we have no idea what their capability is.  What work is the Department doing with the Department of Education to make sure that that groundwork is done on essential skills?  That will carry on from level 2 to level 3.

Mrs C Bell: We absolutely agree and, as we went through the review of apprenticeships, all employers said to us that it was absolutely crucial that young people came in ready with literacy and numeracy, particularly at GCSE or level 2.  We will absolutely make sure that, before a person goes onto the apprenticeship scheme, if they do not have their literacy and numeracy, there will be an intensive programme to support them to get either a GCSE, if that is what an employer requires, or a level 2 in essential skills.  We work constantly with the Department of Education, because our view is that young people should leave school literate and numerate.  If they do not, we have to pick that up in the Department through the essential skills strategy.  It would be lovely to be saying, by this stage, that the essential skills strategy is no longer necessary, but we work closely with the Department on that.

Ms Yvonne Croskery (Department for Employment and Learning): Under the 14-19 strategy, we share responsibility for policy and meet regularly.  We will continue to do that to make sure that we deal with the issue and have building blocks in place to make sure that our young people have maths and English skills at level 2.

Mrs C Bell: It important across all areas.  If a person is not literate, it is very difficult for them to progress to the next level, but certainly in areas such as engineering, ICT or any science-based area, if they do not have mathematics, it is a real concern.  They cannot progress; it is as simple as that.

The Chairperson: You mentioned ICT, and that was also one of the things that were raised.  The employer I was talking about is saying, and the apprentices that he is actually getting at the minute are saying, that their ICT skills are actually starting to fall away compared to where they were five years ago.  It was actually the training and learning manager who told me that they are improving in social media, Facebook and all the rest of it, but they are starting to lose basic ICT skills.  Are we doing anything there to embed that into essential skills from level 2 to level 3?

Mrs C Bell: We have a separate essential skills in ICT, and it is not social media.  It is Word, PowerPoint, Excel and that type of stuff.  While that, too, is incredibly important, if you are going into areas such as ICT or engineering, you need more than that.  You need to start looking at programming, and that is why the ICT work that we are doing through the Minister's working group is so important.  Some of the colleges are now running coding courses for young children to get them interested in programming, and a new A level has been developed in programming because young people were coming out of school thinking that an ordinary ICT qualification was sufficient when, in fact, it was a user qualification and not a programming one.  So, a lot of work is going on in ICT, but there is an ICT essential skill.

The Chairperson: And that is all going to be brought together under apprenticeships, then?

Ms Croskery: Moving forward, one of our proposals is to have one award qualification for each apprenticeship by occupational area, and, in another proposal, we are looking at establishing a strategic partnership group made up of employers that will inform the curriculum to make sure that they have the ICT skills needed for the occupations and jobs of the future.  We are very confident that the issues that you have raised will be addressed, moving forward.

Mrs C Bell: They are a priority in the Department even now.  We are not waiting for the apprenticeship work to feed through; they are a priority.

Mr Douglas: Catherine, I asked the Minister during his presentation about how we target hard-to-reach young people.  I think about NEETs:  many of them have left school without any qualifications.  I have two questions on that bit.  Is there a progression route for those young people while they are involved in a community scheme or whatever, to get to a point where they can actually get the essential skills and apply for those apprenticeships?

Mrs C Bell: There absolutely has to be, because we cannot have a disadvantaged group of society — plus the fact that we need those people.  Therefore, all of the work that we are doing now has progression built into it.  Fundamental to all our programmes is the essential skill, or the essential skills, of literacy, numeracy and ICT.  That is why so much work is going to be put into the new youth training programme.  Even before that, at level 2, young people are leaving school with absolutely nothing.  We need to work with them, motivate them and show them that there are jobs out there that they are interested in.  We need to get them engaged, and that is why the work with communities, through Pathways to Success or our current Training for Success, is fundamental.

Mr Douglas: Are there models — again, I think that I asked the Minister — out there in other countries that have been successful in targeting those young people?  Very often, a scheme can aim to target 20 NEETs — that type of young person — but sometimes they find it very hard to get them in the front door.

Mrs C Bell: There are two answers.  When we were looking for the apprenticeship programme, we were obviously looking right across the world, particularly at Europe.  We were struck by the fact that young people, in the main, leave school ready for an apprenticeship.  Therefore, there is no point in us looking at those European countries.  America has some models of good practice; I looked at them some years ago, and I think that we need to revisit that.  That is one of the tasks that have been given to the youth training team — to look at models of good practice.  Indeed, the pathways people have looked at that.  In my view, there is no doubt that those are the young people who deserve the platinum treatment.  We need to try to re-engage them.

Mr Douglas: I have a final quick question.  It says somewhere here that, at stage 8, someone can actually get involved in a PhD.  What does that actually mean?

Mrs C Bell: We are saying that, under the new apprenticeship programme, we should not be putting barriers for progression.  Therefore, a person can start at level 3, level 4 or level 5 or, indeed, could progress to — as you know, the Minister is very keen that equal value be given to an apprenticeship as to an academic course.  That is to allow a person who does an apprenticeship programme, if they so desire — I do not know why they would — to move into full-time higher education after they have done an apprenticeship at a particular level.

Ms Croskery: If we get this right in our pathway, it means that somebody starting at the very bottom of the ladder — some of the people who you are talking about — can have an aspiration to be the chief executive of their organisation.  They can go right through and get a PhD if they want.

Mrs C Bell: I have to stress that it is not the intention that the public purse will fund that right through.  We will fund fully a level 3, but we would have to look at part-funding beyond that.

Mr P Ramsey: Good morning, Catherine and Yvonne.  When the debate took place — it was not a debate; we were only allowed questions — the Chair amplified the Committee's perspective that the Department was listening to a lot of the issues coming through in the careers inquiry.  There are key elements in this that are most welcome, and they will make a valuable contribution to the future of young people, particularly when the new jobs coming in will be consistently IT or ICT and financial services.  I am very keen to hear where the evolution of public sector apprenticeships is going to take place.  That is something that we talked about here.  How is that going to take place, and is there a buy-in from all the Departments?  I want to come back to some of the points that Sammy made about vulnerable groups, as well.

Mrs C Bell: Yes, we are very keen for this to be extended out to the public sector.  Members may be aware that we already have a pilot scheme going with a public-private ICT apprenticeship, where half of the apprentices are in the public sector and the other half are in the private sector.  They are being trained together in two streams:  software development and infrastructure.  We have a second group — I do not know whether they have started or are about to start — and that has increased exponentially.  We see very many more opportunities, particularly on the technical side in areas such as forensic science.  The fire authority is keen to examine this, as well.  We are at the early stages, but we are pushing it.  Nobody has said, "No, it will not apply to us."  That is the work that we have to do now.

Mr P Ramsey: No doubt, Chair, that is something that we will be keen to support and advocate what is happening on your behalf.  I am also keen to hear how, when we talk about trying to encourage at a career level in post-primary or those who go on to colleges, we can ensure that Colleges Northern Ireland is increasing the level of courses to meet the needs of this new departmental report.  That is clearly evident, as well, in the paper.  Have you had discussions with colleges to increase the demand for courses?

Mrs C Bell: Yes, we have.  Colleges are keen to do this, certainly focusing on level 3, which is their bread and butter, but also progressing beyond that.  I also think that the review of careers that we started on the back of the work that the Committee has done will help with that.

Ms Croskery: With the new model, under our proposals the job will drive what the provision should be in terms of its content and demand.  The provider will be part of that partnership to inform the content to make sure that it meets employers' needs.  I well take your point.  We have been engaging with Colleges NI, and indeed with the colleges, throughout this to make sure that they know our direction of travel.

Mr P Ramsey: Traditionally when we look at apprenticeships, certainly through my generation, it was the construction industry, engineering, bricklaying, electricians and plumbing.  I do not see that here at all.  I do not see any mention of the traditional apprenticeships.  We are going through a bad time in the construction industry, and there is no enticement for small employers, in particular, but I would like to see that continuing because there is a lack of labour in that traditional end of things.

In terms of vulnerable groups, I see this as concentrated on the intermediate and higher-level apprenticeships.  The Minister has made that clear.  I worry that we are leaving a lot of people behind.  The Minister said that other areas were coming along.  I want to see another paper where we are trying to ensure that we bring vulnerable and marginalised groups, and those with a disability, whether learning or physical, into the equation and they are not going to be left further behind.

Mrs C Bell: I will take your point about construction and engineering first.  There is no intention of downplaying those areas at all.  It is just that we are trying to widen the apprenticeship to include many more occupations.  If you think of Northern Ireland's participation in world skills, where we have done better than any other region across the United Kingdom, against the best in the world, and those are in the traditional industries with apprenticeships, why would we want to downplay those?  In fact, we want to see the new areas coming up to their standards, because we have done very well.

In terms of the marginal and vulnerable groups, I give you the assurance that, through the work that we are doing with the new youth training review and Pathways to Success, and when we review all of that in the round, this is to be inclusive.  The last thing we need is for anybody to be left behind.

Mr P Ramsey: I appreciate that.

Mr F McCann: What I was going to ask has already been asked.  I will find another couple of questions anyway.

Mrs C Bell: You don't have to. [Laughter.]

Mr F McCann: There are a couple of things.  It has to be welcomed.  This Committee has for quite a while been concerned at the direction that apprenticeships were going and the disconnect between what was available and industry.  Hopefully, that joined-up approach and how it is dealt with will be beneficial.  Obviously we are catering to higher-end apprenticeships and jobs that are coming in, but Pat is right to say that there are what we call the traditional trades.  There seems to have been a demise in the level of training.  I have been on a couple of training schemes, and most of the ones for bricklaying and joinery and things have closed because of the downturn in the economy.  When the economy turns round, it is those types of trades that we need, so there needs to be a focus also to ensure that high-level training and apprenticeships are available for people there, also.

I fully appreciate that the focus is on 18- to 24-year-olds, but older apprentices also need to be taken into consideration.  That reminds me that I brought the Minister over to a stall in the Long Gallery at one event, and that people in the baking industry and other industries may have a number of people who are just over 24 years old and find it difficult because of a cut in funding.

I raised the question with the Minister the other day, and you spoke about it:  the most marginalised in society.  There has always been that difficulty to get at the NEET people within areas.  What sort of pathway are you creating to ensure that, in all this, they are still not the people who are left behind without any future?

Mrs C Bell: I will start with your comments about employers.  The difference between this apprenticeship programme and what we had traditionally since I came into post, which is quite a long time now, is that the employer is in the lead.  It is the employer who will determine, unlike at the minute whereby a lot of the direction is taken from the providers.  We learned from that.

In terms of construction, I reiterate that we did have a problem with the economic downturn.  People voted with their feet that they were not prepared to go into those industries.  I think that that landscape is changing.  The colleges, and certainly our training providers, will want to go into areas where there is a demand and the demand is increasing.

In terms of your most marginalised, the work that we need to do is back in the schools so that we try to work before a young person becomes disengaged.  A number of the things that are happening within the community on our Pathways to Success programme would be successful if run in partnership with schools. That is something that we have not done but should do.  We should work with them.

Our careers people are going to have a role in this.  They, as you know, work with many excluded young people, and we need to ramp that up.  While the apprenticeship is focusing on the intermediate and higher level, if we are not successful with the young people and adults who need more help, we are only going to create more problems for ourselves down the line and we will not have the workforce coming through.  We need to tap into all the resources.

The last area that you mentioned, if I can drag my memory back, was the over-24s.  That is definitely taken care of within this.  For a long time — sorry, excuse me.

Ms Croskery: With age, moving forward with our proposals we are not excluding anybody, as you will see.  Although we expect in the main a focus on young people, as you would expect with apprenticeships, we are mindful of career changers.  In our proposal, therefore, we clearly say that it will include all ages.

Mrs C Bell: The Minister has said that if a person meets the components of an apprenticeship, they are apprenticed, irrespective of age.

Mr F McCann: That is interesting, because one problem that people faced for the over-24s was a 50% reduction in funding.  Has that been dealt with in this, and will equal funding be available for people aged 24 and over or for firms that want to train such people in apprenticeships in different fields?

Mrs C Bell: First, we are working through a new funding model.  I cannot give you all the whys and wherefores yet, but we will come to it.  It is important to remember that the funding never went to employers; it went to the training providers.  We did not provide any funding for employers.  We have not worked everything through, but there will be a new funding model, and we have to consider, particularly with small and medium-sized enterprises (SMEs), that we may have to provide funding incentives to engage them.  However, we also have to be mindful that we are training an employer's employees, so there should be a contribution from the employer.  All that will be taken into consideration as we work through the funding model.  We do not intend to cut anybody's funding if they meet the seven criteria that the Minister has laid down, and there is no reason why a person of any age cannot access an apprenticeship programme.

Mr F McCann: My final point is about the youth training review.  When will we get sight of what is proposed in that?  It is a crucial element of what we are dealing with.  This morning, I got an email from somebody who raised the concern that any proposal for youth training must be effective.  It must reach the people who need it, and the service provided should be fit for purpose.

Mrs C Bell: That is absolutely correct.  We can run the current model to 2016, but we will put forward proposals in and around April 2014.  Sometimes, time slips, but it will happen quickly because work has already started, and we are mindful that, if the apprenticeship is to be successful, we have to have an equally robust provision for people not yet at an apprenticeship stage.

The Chairperson: Fra, you did all right for not having any questions.

Ms McGahan: Thank you, Catherine and Yvonne.  I have a similar point to Fra's about differences in funding for 24-year-olds.  I have raised the issue of 18-year-olds because it was brought to my attention that they appear to have greater difficulties getting employment as an apprentice.  The attitude of some employers is, "Why would I employ an 18-year-old when I can get a 16- or 17-year-old free?"  Catherine, you mentioned funding going to the training provider.  My understanding is that, unless a young person gets practical experience in a workplace, the qualification is not worthwhile, which means that, effectively, they do not have one.  I want to reiterate the importance of that area. 

The Minister mentioned trying to encourage more women into apprenticeships.  Has the Department any ideas or proposals to deal with that?

Mrs C Bell: I will take the first question.  We cannot dictate to an employer who he or she employs.  I do not understand the differential in the funding between a 16-year-old apprentice and an 18-year-old one, because we do not apply any such differential.  We do with someone aged over 24.  In the past, you were concerned that people who had been through school and got qualifications were excluded from apprenticeships because they already had qualifications.  We are working through those cases on an individual-by-individual basis.  That will not happen under the new model, but it will take a couple of years for the new apprenticeship programme to come in.  Not only do we have funding through the apprenticeship programme, we have funding for training people who are in work through our Skills Solutions programme.  So, if any employers want to upskill or reskill their staff, the Department is willing to work with them and help them to access training and fund it. 

Yvonne, you will have to take the second question because I cannot remember what it was.

Ms Croskery: We have been working with the Equality Commission and will look at what positive action we can take to attract more females, particularly in some of the emerging areas.  We will look at a range of things and are taking advice.  There are things that we can do.  We understand that tasters are very good, and we are working with employers to make sure that they go out there.  We will probably work through the Careers Service as well because it would be good to get to young people at an earlier age.  We are looking at a UCAS-style portal and a central service.  All of those will reach females, in particular, at an earlier stage and try to persuade them of their potential apprenticeship pathways.  We have a range of proactive means to increase female participation, particularly in engineering and the more male-dominated areas.

Mr Hilditch: To be honest, Fra touched on some of my questions, so I will not grope about and look for any more. [Laughter.]

Mrs C Bell: I am very grateful.

Mr Buchanan: Again, some of my questions may have been touched on.  I note that the Department is seeking to develop a funding model that is best suited to its resources.  Is the Department satisfied that it will have the necessary funding to meet the needs when the new model comes on board?

Mrs C Bell: Absolutely.

Ms Croskery: From 2014 to 2020, we are seeking to secure a total of €73 million through our European social fund (ESF) bid, and we will use that money to support our youth training and apprenticeships.  We are co-funding that, with 40% coming from the ESF money in support.  That money is already committed, so we need to work through how we best utilise it for funding apprenticeships and youth training, and ensuring that we have a model that is fit for purpose.

Mrs C Bell: Success breeds success.  When, not if, this is successful and is making a real impact on the economy, it will be much easier to bid for resources.  We are fairly sure that we will get the resources that we need when the time comes.

Mr Buchanan: To make this successful, you will need more employers who are willing to take on apprentices.  You said earlier that you cannot fund employers to train their own employees, which is absolutely right.  At the same time, does there not need to be some incentive for employers?  I have been talking to employers who take on young people and train them.  Their difficulty is that they do not get the young people at the level at which they need them, so they have to step back a year or two and give them training that they should have received at school or college level, which is an added cost.  It will be very difficult to get new employers on board if they have to incur extra costs through such training.  Will there be an incentive of any kind, even to encourage new employers to open up to apprenticeships?

Mrs C Bell: First, our Skills Solutions service fully funds the upskilling or the reskilling of employees.  That is outside youth training and the apprenticeship programme.  That already exists.  Our people will go in and work directly with employers to broker the training and get the training that they need.

On going forward and incentivising employers, we are very conscious that we are an SME economy and that SMEs are reluctant to take on apprentices because of the perceived risk.  Therefore, during this consultation period and beyond, and before implementation, we will look at how we can better engage employers.  One way might be to provide financial incentives for them to take on employees.  Young people should come to an employer with employability and educational skills, not necessarily occupational skills. If they do not, that is a failure of government, and we should pay for that.

Mr Ross: I am not sure whether Fra made three or four "final" points.

Mr F McCann: I have learned always to try to get in first.

Mr Ross: I want to follow on from what Tom said about the funding model.  I take Tom's point about the SME economy and how many SMEs are reluctant to take on apprentices.  At the same time, as stated in the document, we need to recognise the benefits to employers of taking on apprentices, including the longer-term payback.  You said that we need to make sure that we get the balance right and do not, effectively, put taxpayers' money into benefiting a company.  I absolutely agree with you.  That is not the role of government.

The chart in the document that details the Swiss model seems to indicate that the problem is in the first year, when there is no benefit to an employer.  After that, employers start to see the benefits.  I suppose that, particularly for an SME, that causes difficulties because they do not have the necessary cash or means available.

I know that you are reluctant to get into the issue of financial incentives because there is a consultation, but there must be some thinking going on in the Department.  Is the Department's thinking that there would be support for only the first year, with the company or employer having to take on that responsibility in the second year?  The Minister said that it would be a minimum of two years. 

When talking about financial incentives, are we talking about providing cash to employers or are other mechanisms available to us?  Is it even possible to look at tax incentives for companies?  Are there other means of support, for example, a central administrative support that SMEs may not have?  I am not asking you to say which, because the Minister will choose, but what forms of financial support are available to us under the systems that we work in Northern Ireland?

Mrs C Bell: First, off-the-job training will be fully funded at level 3.  We have to look at level 4 and beyond because we have to make sure that we do not disincentivise anybody who wants to go to higher education.  Our thinking on incentives to employers is at a very early stage.  However, we are conscious that the additional burden on an employer is much greater in the first year than in the following years. 

In addressing the administrative burden, we are looking at grouping SME apprenticeships so that we reduce the bureaucracy involved.  An organisation would do the administration on behalf of SMEs.  Whether we will end up with that, I do not know.  We have to examine it.  Yvonne is closer to the tax incentives than I am.

Ms Croskery: We are working with our colleagues in England on looking at how they are going forward on this.  Tax is not devolved, so we will be working to see how it works in England and might work for Northern Ireland.  We do not have to do exactly the same as our neighbours, but we certainly want to look at anything that would help the system along.

Mr Ross: Is it even possible to do that?

Ms Croskery: We know that it is possible, but England is looking at some issues of concern.  After consultation, they believe that they can do it through the tax system, but they are not clear what the best route is.  They are mindful that they also have a lot of SMEs and of the payroll systems needed to support such a model.  We are also looking at incentives within the confines of the European social fund because everything that we do has to be mindful of the rules and regulations there.

We may look at helping some apprentices with tools.  There is a range of things that we want to look at, but not necessarily cash in hand.  I would describe it as benefit in kind, which would help to provide encouragement in that first year.  If we get this right through the central service, the promotion and the marketing, working with SMEs to show them the benefits that we rightly articulated in this report and seeing how we can support them with benefits in kind, we are confident that we will have an awful lot more apprenticeship vacancies in Northern Ireland.

Mr Ross: The larger companies with their own apprenticeship schemes do not currently receive any taxpayers' money.  Is there a fear that, with the financial incentives that will be offered to companies to take on apprenticeships, those larger companies will simply say, "We will no longer fund ourselves.  We will just go to taxpayers and they will fund our apprenticeship schemes"?

Ms Croskery: We do not see that as a risk in that we hope to look at overtraining as well.  There may be benefits in that.  Some of the larger firms are delivering their own provision and are funded.

Mrs C Bell: Very few of the larger firms providing apprenticeships are completely unfunded.  Bombardier does in-company training and has an element of off-the-job training for which it is not funded.  It works with the likes of the Belfast Met, which provides the training, and we fund that because it has a contract with the Department to run apprenticeships.  As Yvonne said, the idea of overtraining is really attractive because companies could train to the standards that they want, and those people could then go to their supply chains.  That will all be examined in the next period.

The Chairperson: Yvonne, you mentioned benefits in kind.

Ms Croskery: I am talking about help with tools for an apprentice.  Sometimes, tools can be costly.  We will look at how we might do that, not necessarily by paying money but by doing something to ease the burden for the employer in taking on an apprentice.  That might even mean a toolkit for some of the more hands-on areas.

The Chairperson: That goes back to the more traditional skills that Pat was talking about.

Ms Croskery: That is right.

The Chairperson: The final comment in the Minister's statement was about how this all could change with George Osborne's review of HMRC and how that looks at apprenticeships.  Are you building that into this review?

Ms Croskery: We are.  I am working very closely with England, Scotland, Wales and, indeed, our neighbours in the Republic of Ireland.  We had a teleconference at ministerial level on tax, and we are working together to find out how that is progressing.  At official level, systems will be put in place to see how we could build our system around it.

Mrs C Bell: The idea of tax incentives came out of a proposal from the UK Commission for Employment and Skills and a report led by Nigel Whitehead.  The Department for Business, Innovation and Skills officials who will have to work with HMRC are at an early stage of their thinking and are setting up a working group to see how they can make it happen.  Yvonne talked about a ministerial teleconference, but there was also an official teleconference earlier this week, and they said that they will be mindful of the devolved Administrations.  I would like that statement to be a bit stronger.  I would like them to say that the devolved Administrations will have a say.  We will work with Scotland and Wales to make sure that there is a strong voice from the devolved countries.

The Chairperson: Hearing benefits in kind and HMRC in the same context can be concerning.  Catherine and Yvonne, thank you very much for your time.