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NUS proposes subsidy to end underpayment of apprentices

Tuesday 13-10-2015 - 13:31

We are recommending that the newly introduced apprenticeship levy be used to subsidise the wages of young apprentices in order to increase their uptake and end the exploitative apprentice minimum wage.

We propose that businesses employing apprentices aged 16-21 should be able to use their levy funds to pay the wage differential between the apprentice minimum wage (currently £3.30 p/h) and the intermediate 18-21 national minimum wage rate (currently £5.30 p/h).

The advantage of such a system would be that employers could offer a more attractive apprenticeship to young people without incurring a direct cost. The only indirect cost would be a reduction in the amount available from the levy fund to pay for training and assessment.

Shakira Martin, Vice-President (Further Education), said: 'The current minimum wage for apprentices is exploitative and fails to meet the basic cost of living. Apprentices need to be properly paid, but we also recognise that employers need to be incentivised to provide more apprenticeship opportunities. Using the apprenticeship levy to top-up apprentice wages is an innovative solution that could improve apprentice pay without employers incurring a direct cost'.

Despite the Government’s pledge to create three million new apprenticeships by 2020, currently only 4% of school leavers are taking up apprenticeships, compared to 49% entering higher education and at least 6% entering employment.

The Government’s proposal to tax businesses in order to fund more apprenticeships is welcome, but will struggle to make apprenticeships more attractive to young people without respectable wages and more stringent assurances of quality.

Wage subsidies for apprentices are already a feature of some countries’ skills systems, such as Austria.

The National Society of Apprentices was formally launched in February 2014 and is housed within NUS. It works with more than 120 training providers and employers, representing over 150,000 apprentices. The NSoA represents apprentices from across all sectors and industries, across the whole of the UK regardless of level or framework. It is directed by an elected team of apprentices.

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