Future-proofing the Apprenticeship Levy: Time to think big on digital skills

As the UK carves out a new economic future following the EU referendum, is it time for a more radical approach to skills and talent that is fit for purpose for the digital age? techUK has repeatedly called for more to be done to tackle the digital skills shortages. Only this week, techUK member Barclays released a report that found that the UK is being outpaced in the development of digital skills.

That’s not to say we haven’t made progress in recent years. There is cause for optimism in the new Computing Curriculum and this month’s announcement, in the Post-16 Skills Plan, that digital skills will form part of the core curriculum for all ‘routes’. However, given the need to stay globally competitive and with uncertainty surrounding the tech sector’s ongoing access to talented workers from the European Union, it is now more important than to make sure that key Government initiatives, such as the Apprenticeship Levy, are properly fit for purpose.

In short, in both design and delivery the levy must work for and not against the needs of the most dynamic and innovative sectors of the UK economy. There are still too many aspects of the Apprenticeship Levy that fail this basic test. But it should also be used more creatively to help existing employees adapt and re-skill in a rapidly changing workplace.

With responsibility for skills moving to the Department for Education, here are five suggestions for where the new Government and Education Secretary Justine Greening MP working with Digital Economy minister Matt Hancock MP might look to make a start:

1. The world of work is changing rapidly, and the levy needs to help people adapt and re-skill

In an era of rapid disruptive technological change, it should be possible for companies to use the levy more flexibly so that they can help existing employees to adapt to the needs of a fast changing work place. Employers should be incentivised to use the levy to reskill employees in roles that could become vulnerable to automation. The levy should also be available to help other key groups back into the workforce such as military veterans or female returners.

2. The Digital Apprenticeships System must be fully operational well before the ‘go live’ date

The administrative portal known as the 'Digital Apprenticeship System' must be fully operational and beta-tested before the levy is implemented. Many tech companies are looking to divert their levy funds for use within their supply chain. At the moment there is no clarity about whether this will be technically achievable.

3. More transparency is needed on the makeup of the Institute for Apprenticeships

As the current pace of accreditation is an area of real concern for many tech firms. The Apprenticeship Levy must be future focused and allow flexibility for roles that are in high demand. The current system for the creation of apprenticeship standards is cumbersome and bureaucratic. Many of the roles that will be needed in 2020 have not been created yet, and the implementation of the levy needs to be fleet of foot to meet fast evolving employer requirements.

4. Digital skills must be at the forefront of every apprenticeship standard

As the UK grows its domestic talent pipeline, we must look ahead to the jobs of the future and ensure the future workforce is equipped with the skills it needs. As such, digital skills must form part of the core of each apprenticeship, regardless of level or qualification.

5. The Government must ensure that businesses are fully aware and ready for the implementation of the Apprenticeship Levy

The lack of clarity surrounding EU nationals’ right to work in the UK coupled with reforms to the skilled migration system, and incomplete information on the Apprenticeship Levy are hindering the ability of tech companies to undertake proper talent management planning. Many companies are not aware of how they will be impacted. There is a real risk that the cost of the levy will be written off and the levy itself underused. This can undermine the case for further investment in talent development.

Antony Walker, deputy CEO of techUK