Written By:

Ian Price
Director
CBI

 

___________________________________________________________________________________________________________________________

Whoever emerges from the Welsh leadership contest as the next First Minister will do so with our good wishes.

But, against the background of unprecedented economic difficulties those good wishes come with a clear message; it’s time to put apprenticeships at the heart of economic growth strategy in Wales.

It’s good to hear the issue being raised by both candidates on the hustings trail, but business wants action on funding to ensure there’s a steady flow of talent trained with the skills they need.

This aim is uncertain after the Welsh Government’s draft 2024/2025 Budget, published before Christmas, proposed deep cuts to the sector that threatened to hamper the great work of our Further Education sector.

Whilst tackling the cost-of-living crisis and providing proper funding for those in need remain understandable priorities for government, the business and FE sector are deeply concerned about funding cut-backs to the Welsh apprenticeships budget.

Colegau Cymru estimates the apprenticeship programme will be cut by almost one-quarter, when the loss of EU funding post-Brexit is added. It suggests this could mean a drop of 10,000 places in 2024/25 on the Welsh Government’s apprenticeship programme.

From Gower College Swansea to University College Wales and Cardiff University and firms in north and south Wales, there is a growing clamour to protect this vitally critical area of funding.

Apprenticeships, alongside other forms of training such as flexible modular learning for adults already in the world of work, are an important cog in successful businesses. We’ve got an excellent FE sector in Wales. The business community has benefited from the funding which has gone to colleges, which have developed excellent schemes to equip people for the world of work.

In 2021, the Welsh Government carried out a survey to evaluate the devolved apprenticeship programme. Around 73% of employers indicated that they were satisfied with the design of the apprenticeship programmes.

The same percentage of those surveyed spoke positively about their main apprenticeship provider. Apprentices who participated in the study expressed even higher levels of satisfaction with their training provider and employer. They also said it gave them confidence.

Whilst employers did not view the apprenticeship programme as irreplaceable, they didn’t tend to view the alternative options as better.

Significantly, employers found the programme had a positive impact on the overall Welsh economy as it raised the skills level of people with few or no skills.

Sustainable growth requires investment in our people’s skills and capabilities, alongside our infrastructure and productive capability, openness to new ideas and embracement of innovation.

We need to ‘future-proof’ the labour market to drive inclusive growth, by building a skilled, productive and healthy workforce in Wales and across the rest of the UK.

Persistent labour and skills shortages are the most pressing issue holding back economic growth.

We must support the green and digital transitions. The skills people learn on training and vocational schemes are increasingly aligned with firms looking to invest in Wales. Firms looking at relocating or setting up from scratch in Wales need access to a well-funded apprenticeship scheme.

We must also ensure people from outside our big towns and cities, who do not go onto higher education, don’t miss the opportunity to gain the qualifications and training to enter the workplace with skills.

One way of providing more funding would be to ensure the UK Apprenticeship Levy is distributed to Wales-based SME’s and is not lying left in a pot of Westminster funding.

It’s a nimble solution that has no extra costs for the taxpayer because the money’s already there!

Action on apprenticeship funding must be a key priority for whoever emerges the winner in the Labour leadership election and becomes First Minister in the coming weeks.