Funding cuts will drain 'lifeblood' from technology SMEs, says CompTIA

Two-thirds of the UK's 900,000 apprenticeships are offered by SMEs

In April this year, apprenticeship providers were shocked by an announcement by the Education and Skills Funding Agency (ESFA), which revealed that funding for programmes starting between May and December was being cut by up to 89 per cent.

The news, which affects providers of programmes for non-levy-paying* apprenticeships, was particularly criticised for targeting providers of small business apprenticeships. At the time, a spokesperson for the Association of Employment and Learning Providers told People Management that "a substantial proportion" of SME apprenticeship schemes would be affected.

The Computing Technology Industry Association (CompTIA), an industry body for the technology trade, has said that the cuts will particularly hurt technology SMEs. The association says that the move will damage small businesses' ability to find and develop a skilled workforce, claiming that the new levels of funding will ‘barely' cover six weeks of the eight-month training period.

Graham Hunter, CompTIA VP EMEA, said, "The government's decision to cut funding for apprenticeship training providers is incredibly perplexing and very disappointing. This is a time when government needs to be developing the UK's talent pool and supporting SMEs, which are the lifeblood of the British economy. Yet, by axing allocations to training providers, these organisations have effectively lost access to one of the best sources of talent available to them; willing workers who have chosen not to go to university and [instead] learn their craft through gaining real-life, industry experience.

"This decision is even more concerning when you consider the future of the UK post-Brexit. Once we leave the EU, Britain needs to be investing in developing its own talent pool with the skills to attract businesses to the UK and reduce our reliance on overseas workers. This decision could stall this whole process and damage our economy going forward."

Technology SMEs, who rely on apprenticeships to develop a trained workforce, will be particularly affected by the decision, at a time when the UK is suffering from "an IT skills crisis."

Hunter urged the government to reconsider its funding stance, "so that the country's smaller businesses can develop the talent they and the economy need to thrive."

* The apprenticeship levy is a charge payable by all UK employers with annual salary bills of more than £3m, which came into force this year.