Labour risks making Britain’s graduate employment crisis worse by cutting funding for high-level apprenticeships, a leading provider has warned.
In the past 15 months ministers have already come under fire for their tax raids on private schools, their Children’s Wellbeing and Schools Bill and now over 21s, many from disadvantaged areas, will be hit with further employment struggles in an already harrowing job market.
State funding for level seven apprenticeships, considered to be equivalent to a master’s degree, will be axed for those aged 22 and over from 1 January 2026.
This means graduates who have taken placement years, embarked on four-year courses, or taken gap years will no longer be eligible for funding.
And without the subsidy, industries will struggle to hire new employees due to training costs, and many graduates cannot afford to self-fund their training.
Gareth John, chief executive of accountancy training provider First Intuition, said: “I think the government has this inaccurate and unfair belief that people on the higher level schemes, the older the person is, that people on level seven apprenticeships are all in their 40s and earning good money.”
He revealed the apprenticeship levy, introduced in 2017, has helped increase diversity in the accounting sector and the cuts disregard those who are not on linear pathways into higher education.
He said: “I think we’re going to lose so many opportunities for graduates.
“It’s going to affect the chances of a lot of these disadvantaged young people.”
Steph Harris, director of policy for Universities UK, shared this sentiment.
She said: “I think you know we are really concerned that it might have an effect on limiting people’s career progression essentially.”
A Department of Education 2023 evaluation found around one in five level seven apprentices came from the most deprived areas of the country.
His worries come amid a flurry of university outcry against the cuts.
University Alliance said: “We continue to strongly oppose the nonsensical move by the Labour administration to remove funding from Level seven apprenticeships for people aged 22 and above.
“Limiting funding to an age group that typically has barely finished Level six education borders on the absurd and amounts to an all-out defunding of Level seven apprenticeships.
“This poses challenges not only to critical industries like healthcare, town-planning and architecture, who do not have the additional budget to fund these qualifications outside of the apprenticeship levy – but also to widening participation.”
A report carried out by the four largest accountancy apprenticeship providers in the UK found over 70% of level seven accountancy learners were aged 24 or below when they started a programme.
Law graduates over the age cap will have to fork out nearly £5000 for their solicitors training if their firms cannot support them.
Emily Cole, a law student from Bournemouth University, lost her funding for her solicitor training.
Cole was encouraged to take a placement year in industry, gaining skills she viewed as invaluable, but it means she will be over the age cap when she graduates and will no longer be eligible for funding, and her firm cannot cover the cost.
She said: “It’s definitely not ideal for people like me who are at university, haven’t really got a secure source of income full time, and having to find the money is obviously difficult.
“Labour implemented the changes to fix one thing, but actually, they’ve opened a big floodgate for another issue that people certainly aren’t going to be happy with.”
John warned it is smaller firms who will be most affected by the cuts.
This comes as businesses are already squeezed by the Chancellor’s looming budget on top of National Insurance and minimum wage hikes.
The University Alliance added: “The government has seen sense and made some mitigations to the defunding of level 7s in healthcare.
“We urge them to rethink their decision and extend mitigations to other critical industries too.”
All current level seven apprentices and any who start before 1 January 2026 will be funded through to completion.
A government spokesperson said: “Apprenticeship starts fell by almost 40% over the last decade for those under 25.
“We want to enable levy funding to be re-balanced towards young people which is why we will only fund Level 7 apprenticeships, which are equivalent to a master’s degree, for those under the age of 22.
“Our post-16 education and skills white paper outlines our plans to break down barriers to opportunity, put universities on a firmer financial footing and boost the skills that will take our country forward and support the government’s plan for national renewal.”
Featured image credit: Unsplash
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