Black Country trainer secures £1.2m to manage apprenticeship loan scheme
A MIDLANDS training company has secured £1.2m to manage a new loan scheme to fund advanced apprenticeships.
BCTG is one of a handful in the West Midlands accredited to provide loans under the new system, which will affect anyone aged 24 and above who wants to gain qualifications at NVQ level three or above, including A levels.
From April this year trainees will have to apply for 24+ advanced learning loans to cover the cost of their training and qualification.
Staff at BCTG said the average cost of a course could be anything between £3,000 and £4,000 but they fear many people are unaware of the changes coming in.
Chris Luty, BCTG director, said: “Just as with tuition fees in Higher Education, the government has decided that people who need or want to get an NVQ level three qualification and above to progress in their career, will have to fund the course themselves.
“It will affect everyone from trainee accountants who need to progress with their qualifications or health carers who want to take on more responsibility and need the relevant NVQs to advance their careers.
“And like tuition fees many will have to take out a loan to cover their costs. However our concern at the moment is not enough people are aware of the new changes which are about to take place.”
Loan repayments will be through the tax system once the borrower is earning more than £21,000 and repayments are set at 9% of the income earned beyond the threshold.
They will not be means tested or subject to credit checks or dependent on employment status.
Mr Luty added: “While the new system means individuals will need to pay for their training, they do reap the rewards through better job prospects, and because repayments don’t start until you earn £21,000 those in lower paid jobs, stand to gain the most. Even then, repayments start from £7 per month.”
He said compared to HE Loans, 24+ Loans were much easier to manage. In 2013 the typical HE debt is predicted to be £59,000. With 24+ Loans the average is expected to be nearer £4,000.
“Those with a Level three qualification on average earn £3,000 more per year than someone with no qualifications, (so) the advantages are clear,” said Mr Luty.
“This new system will have a considerable impact on training providers and colleges, who will have to offer loans to students. There could be a risk of a race to the bottom as providers compete and reduce their fees for courses, alternatively because it shifts the buying power to the individual it should drive up quality among providers.”
Oldbury-based BCTG has set up a special loans advice hotline on 0845 873 3855 for those seeking more information.
Advisers will also be hand at four The Real Apprentice roadshows taking place at Molineux stadium, Wolverhampton on March 4, Brierley Hill Civic Hall, on March 6, The Public, West Bromwich, March 11 and Banks’s Stadium Walsall on March 14. All events run from 2-8pm and are free.
