Transport Committee Report: Restore Level 7 Apprenticeships for Over-22s and Increase Levy Flexibility to Address Manufacturing Skills Crisis

Transport Manufacturing Faces Skills Crisis: Committee Calls for Apprenticeship Funding Reform and Greater Levy Flexibility

A new Transport Committee report has urged the Government to make the most of once-in-a-generation opportunities to better support the transport manufacturing sector to nurture and grow the skills it needs to thrive.  

The Committee’s report calls for action to seize the opportunities aligned to the Government’s legislative agenda on bus and rail services and cleaner fuels. It explores the skills needs of the transport manufacturing sector and suggests a series of recommendations to better attract entrants into the sector and support the retention and development of existing employees, especially women.  

The UK has a long and proud history of manufacturing motor vehicles, buses, aeroplanes, trains, ships and their component parts, but there are widespread concerns among manufacturers today as they confront skills shortages in parallel with the rising challenges of transitioning to cleaner and more advanced technologies. 

Evidence to the inquiry highlighted specific skills shortages across the aerospace, automotive, maritime and rail sectors, while the Committee heard that that “the journey to net zero has fundamentally transformed the skills required across the automotive and wider transport manufacturing industries”. 

To better help address the challenges faced by the sector, the report says that the Department for Transport should gather information from transport manufacturers on how well the UK’s vocational training system is delivering a robust pipeline of skills and should then share those findings across Government to inform further development of vocational training pathways.  

Competency Passport

It calls for Skills England to consult on the benefits of a ‘competency passport’ that would harness transferrable skills within the transport manufacturing sector and help workers to move between roles. 

Elsewhere, the report acknowledges that the Government is seeking to re-balance funding to prioritise younger people but says that its removal of funding for level 7 apprenticeships for people aged 22 and older risks jeopardising the supply of experienced and highly skilled workers for the transport manufacturing sector.  

The Transport Committee calls for funding to be brought back for all ages

It concurs with a recent Education Committee report that calls for this funding to be brought back for all ages within the eight growth-driving sectors identified in the Government’s Modern Industrial Strategy.  

The report notes that there is broad support for the Government’s levy system among transport manufacturers, but notes that constraints imposed by Government on how that levy funding is spent is reducing opportunities to invest in growing skills. It calls for increased flexibilities in spending levy funding, but it also says that the Government should consider whether funding, under its new Growth and Skills Levy, should be withheld if employers fail to deliver against their own diversity targets.  

Transport Committee Chair Ruth Cadbury said:   

“The UK’s track record of manufacturing motor vehicles, buses, aeroplanes, trains and ships is something we can be proud of. But with the sector facing an array of challenges, how do we harness the talent we have and ensure that the sector continues to thrive? 

“Our report sets out a number of recommendations to ensure that we seize the new opportunities out there, especially in growth areas such as electric vehicles and alternative fuels. 

“The DfT should start by doing a deep dive to establish whether the UK’s vocational training system is cutting the mustard for young people, who are too often turning away from potentially lucrative and fulfilling careers in the transport manufacturing sector. 

“Skills England should explore the idea of a competency passport to help existing workers make the most of their skillsets and the Government should bring back funding for level 7 apprenticeships for people over the age of 22 to ensure that we’re also able to develop the highly skilled workers that the transport manufacturing sector needs. In addition, we think there may be a strong case for making the release of Government levy funding contingent on an employer’s delivery against their own diversity targets in order that the immense talents of women are better acknowledged and supported in the sector. 

“These are just some of the ways we could help to ensure that our transport manufacturing sector is not standing still while other nations motor ahead into new growth areas. 

Transport Committee recommendations  

Increased flexibility over how to use levy funding 

The apprenticeships system is being fundamentally restructured with a new Growth and Skills Levy replacing the existing apprenticeship levy. With concerns from transport manufacturers about constraints on how levy funding can be spent, flexibility over how to use levy funding should be increased so that it can be spent effectively. 

Transport skills requirements continuously reflected in the standards 

Apprenticeship standards and other technical education standards can be outdated and do not always meet the skills requirements of employers. Skills England should work with transport manufacturers to ensure that technological changes, current skill shortages and requirements specific to certain transport sectors are continuously reflected in the standards. 

Gathering of information from transport manufacturers 

There is a significant and complex challenge to be overcome in increasing entry to and diversity in the transport manufacturing sector. The Department of Transport should gather information from transport manufacturers on how well the UK’s vocational training system is 20 meeting their skills needs and share this across Government to inform improvements in vocational training pathways. 

Consultation on a skills ‘competency passport’ 

Existing workers can find it challenging to move between roles within the sector, despite the value of transferrable skills to employers. Skills England should consult on the benefits of a ‘competency passport’ to make it easier for workers to move between roles.  

Reintroduction of funding for level 7 apprenticeships for people aged 22 and older 

The Government’s removal of funding for level 7 apprenticeships for people aged 22 and older risks jeopardising the supply of experienced and highly skilled workers for the transport manufacturing sector: such funding should be reintroduced within the eight growth-driving sectors in the Modern Industrial Strategy. 

Review to ensure accessible training options 

Skills England must also undertake a review to ensure that it supports a range of modular or part-time apprenticeships, or other training options, making these accessible to people with caring responsibilities or returning from career breaks. 

Government levy funding to be contingent on employer’s meeting their own diversity targets? 

Manufacturers in receipt of levy funding or apprenticeship support should be required to report annually to Skills England on the uptake of these options by candidates with caring responsibilities of those returning to work after career breaks to ensure support is reaching that cohort. The Government should also consider whether further release of levy funding should be made contingent on employer’s delivery against their own diversity targets.  

Report on progress towards women’s representation target 

The Department for Transport should report on progress within transport manufacturing towards achieving the Government’s target to increase women’s representation in the advanced manufacturing sector to 35 per cent of the workforce by 2035. 

What is the Transport Committee?    

A cross-party group of backbench (non-Government) MPs that is appointed by the entire House of Commons to carry out inquiries into the Department for Transport’s policies, scrutinise its decisions and hold it to account. The Committee also scrutinises organisations such as Network Rail, the Office of Rail and Road, National Highways, the Civil Aviation Authority and HS2 Ltd, as well as companies that provide public transport.