Consultation on the Scottish Government response to the introduction of the UK Apprenticeship Levy

1. Introduction and Background

1.1. This report presents the findings of an analysis of responses to a consultation on the Scottish Government response to the introduction of the UK Apprenticeship Levy.

The policy context

1.2. Proposals for an Apprenticeship Levy were announced by the UK Government in the summer 2015 Budget, to apply to the UK as a whole, including Scotland. The Levy will begin in April 2017, and employers in the public, private and third sectors will pay 0.5% of their annual pay bill in excess of £3m.

1.3. The UK Government has indicated that Scotland's share of Levy funding is already included in the Scottish Government's block grant for the next three years. Although training levies are reserved to the UK Government, responsibility for skills policy, including Modern Apprenticeships ( MAs), is fully devolved. It will be for Scottish Ministers to develop proposals on how Scotland's share of the Levy will be allocated when setting future Scottish budgets.

1.4. The introduction of the Apprenticeship Levy comes at a time when the Scottish Government policy on MAs has already been set. This forms part of the planned seven year implementation of the Youth Employment Strategy in Scotland "Developing the Young Workforce" ^[3] .

1.5. The Youth Employment Strategy sets out a number of key actions and associated milestones. At present, there are more than 25,000 new MAs each year in Scotland, and the Scottish Government is committed to increasing this to 30,000 per year by 2020. MAs are now the main means of delivering workplace-based vocational qualifications for young people.

1.6. As well as increasing the overall number of new MA places, other actions in the Youth Employment Strategy include:

• Oversight and quality assurance structures (to ensure MAs are relevant to the needs and expectations of businesses).
• Foundation Apprenticeships (to promote early intervention for young people at risk of exclusion from the labour market).
• Advanced or "Graduate" Apprenticeships (to tie MAs more closely to the skills required to support economic growth, and to focus on skills in Science, Technology, Engineering and Maths [ STEM]).
• Measures to improve access to MAs for: young people from BME communities; disabled young people; and care leavers, and measures designed to end gender segregation within some skills areas.
• Measures to support employers to invest in their young workers, develop the role of colleges further in preparing young people for employment, and support economic growth.

1.7. Additionally, the UK Government is overhauling the development and delivery of apprenticeships in England. While this is an area of UK Government responsibility, the Scottish Government has been working to ensure that cross- UK issues ( e.g. the future of existing levies and the infrastructure that supports the development of apprenticeship frameworks) are fully considered.

1.8. The Scottish Government recognises that the use of Apprenticeship Levy funding and the development of MAs should reflect the wider policy context and the needs of the Scottish economy. As such, the Scottish Government is keen to work with employers and other stakeholders to shape the response to the introduction of the Levy, and discussions have already taken place which have helped to shape the development of options on the use of the funding.

1.9. These options formed the basis of a consultation document which was issued in July 2016 ^[4] . The consultation asked for views on the use of Apprenticeship Levy ^[5] funding by the Scottish Government. This report presents the analysis of the findings.

The consultation

1.10. The consultation focused on five main elements, as follows:

• Whether the Scottish Government should maintain the current Modern Apprenticeship growth ambition ( i.e. 30,000 starts a year by 2020), with a commitment to industry to fund further expansion should there be demand, or whether this should be increased (Question 1).
• Whether to use the Apprenticeship Levy funding to support growth in the number of Graduate Level Apprenticeships in Scotland (Question 2).
• Whether to use the Apprenticeship Levy funding to establish a flexible skills fund to support wider workforce development (Question 3).
• Whether to use the Apprenticeship Levy funding to support the expansion of Foundation Apprenticeships (Question 4).
• Whether to use the Apprenticeship Levy funding to help unemployed people move into employment and to help meet the workforce development needs of employers (Question 5).

1.11. At questions 1-5, respondents were asked a closed question and provided with space for additional comments. They were also given the opportunity to make additional suggestions on how the Apprenticeship Levy funding might be used (Question 6). The questions are provided in full at Annex 1.

1.12. A response form was provided on which respondents could record their answers. The consultation was made available on-line through Citizen Space. Respondents were also asked to complete a Respondent Information Form ( RIF) giving their own details and indicating whether or not their response could be made public.

Submissions and respondents

1.13. The consultation ran from 13 ^th July to 26 ^th August 2016, although responses were accepted until 2 ^nd September. A total of 374 responses were received and included in the analysis. Two responses were received which were too late for inclusion in the analysis, but are available in full to the Scottish Government.

1.14. The types of respondent by category are set out in Table 1 (below). A list of respondents is provided at Annex 2 (excluding those who requested confidentiality or anonymity, or who did not provide a RIF).

Table 1. Respondents by category

Category	No.	%
Private sector and private sector representative bodies	169	45
Colleges, universities and the training sector	64	17
Individuals	54	14
Third sector and third sector representative bodies	27	7
Local authorities and local authority representative bodies	24	6
Government and Non-Departmental Public Bodies ( NDPBs)	17	5
NHS	11	3
Trades Unions	8	2
	374

1.15. As is clear from the table, the largest number of responses (almost half) were from the private sector and representative bodies. Also common were responses from colleges, universities and the training sector (17%) and individuals (14%).

1.16. A total of 280 unique responses were received via Citizen Space, with the remainder (94) being submitted via email or letter. A total of 49 respondents requested that their response should be treated as confidential.

1.17. A majority of responses followed the format of the consultation document and questions (whether submitted by Citizen Space or other means). At each of questions 1 to 6, more than three quarters of the respondents provided qualitative comments, generating a very large amount of material. Many also provided further additional information ( e.g. about their organisation or their involvement in the subject matter).

Analysis of the data and presentation of the information

1.18. The analysis of the data involved a number of stages, which were:

• Design of an Access database to include the data for each question.
• Transfer of responses submitted through Citizen Space and verbatim input of responses submitted by email and letter.
• Quantitative analysis of the closed questions.
• Preparation of a series of Word documents containing all textual material ready for qualitative analysis.
• Identification of the key themes and sub-themes for each question.
• Summary of the findings and preparation of this report.

1.19. The presentation of the information involves some quantitative material, although most of the detail is qualitative. The quantitative information includes:

• The number of respondents overall, and by type (Table 1 above).
• The proportion of respondents who answered each closed question and who made additional comments.
• The breakdown of views in the closed questions 1-5 ( i.e. the number answering "a" or "b" at Question 1, and "yes" or "no" at questions 2-5).
• Patterns of agreement with different combinations of questions.

1.20. In addition to the quantitative information, some respondents who did not specifically answer the closed part of the question by using the "tick box" provided comments which indicated their preference clearly. This number has been included in the balance of views at each question. This involved some subjective judgement, and these figures are not definitive, but give a clear indication of the overall pattern of views.

1.21. The rest of the analysis and presentation of the material is qualitative. Respondents provided a large amount of additional detail, which is presented by themes and sub-themes to reflect the range and depth of views.

1.22. While the broad proportion of respondents highlighting the main themes is given in each case, these are indicative and expressed as "around" the proportion ( e.g. "around a third"). For most of the detailed material and sub-themes, qualitative terms ( e.g. "a small number"; "a few"; "several"; "many"; etc.) are used to present the information, and to indicate common views. It should be borne in mind, however, that even where "many" respondents mentioned an issue within an overall theme, this would not generally represent a large proportion of the overall number of respondents, and would not represent a majority view.

1.23. It would be inappropriate to quantify this material further, because:

• The focus was on the range of views, rather than "weight" of responses.
• Some responses represented the views of a number of contributors.
• Respondents made suggestions at different questions, and in different formats.
• Respondents were self-selecting, making it impossible to generalise from findings.

1.24. The report cannot provide a compendium of the information in the responses, nor can it present every individual point made. It does, however, summarise themes and issues raised, even by small numbers of respondents. The full text of the responses can be viewed on the Scottish Government website ^[6] .

1.25. The wording used to present the qualitative material sometimes follows the wording of a response closely (although not presented as a "quote"). This is done to ensure the respondents' intended message is represented accurately. Quotations have not been used, as this might imply that the views of one respondent carry more weight than another.

1.26. The report does not list the types of respondent identifying each individual theme, as this would make the report difficult to read. It does, however, identify any patterns by category at each question. The term "respondent" refers to one response, even if it represents the views of more than one contributor.

1.27. The remainder of the report presents the findings, as follows.

• Section 2: Modern Apprenticeships growth ambition (Question 1).
• Section 3: Graduate Level Apprenticeships (Question 2).
• Section 4: Flexible Skills Fund (Question 3).
• Section 5: Foundation Apprenticeships (Question 4).
• Section 6: Support to move into employment (Question 5).
• Section 7: Additional suggestions and other comments (Question 6).
• Section 8: Summary.