Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [HL]

The Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill (Bill 184 of 2024-25) will have its second reading in the House of Commons on 25 February 2025, having been introduced to the House of Commons on 12 February 2025.

The bill started in the House of Lords, where it was introduced on 9 October 2024. It had second reading in the Lords on 22 October 2024, committee stage on 21 and 26 November 2024, report stage on 5 February 2025 and third reading on 11 February 2025. The bill was amended in the Lords at report stage.

The bill brought to the Commons comprises 14 clauses: 13 clauses from the original bill introduced to the Lords and one clause added by the Lords.

The bill, together with its explanatory notes and other documents are available on the Parliament website: Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill [HL].

The government has also published a delegated powers memorandum. The House of Lords Delegated Powers and Regulatory Reform Committee did not highlight any of the powers in the bill for attention.

The government has published a policy document alongside the bill. This sets out its intention to transfer the functions of the Institute for Apprenticeships and Technical Education to Skills England, which has been set up as executive agency within the Department for Education.

The bill applies to England. Skills are a devolved subject matter and each country within the UK sets its own skills policy. However, Skills England will analyse skills needs across the United Kingdom.

This briefing explains the background to the bill and what the bill would do.

What is the state of skills in England?

Skills England reported that there is “clear evidence” of a gap between the skills that are needed by UK employers and the skills that are held by the UK workforce.

Skills England published its first report in September 2024: Skills England: driving growth and widening opportunities. This report included an analysis of current skills challenges in England and the UK, as well as an analysis of future skills needs.

Skills England reported that there are “significant skills barriers” in the UK. Some of the report findings included that:

• in 2022, 36% of UK vacancies were due to skills shortages
• there are wide disparities in the labour market and skills in different regions
• employer investment in training has been falling over the past decade

In its manifesto for the 2024 general election, the Labour Party also referred to widespread skills shortages across England and a falling number of people participating in apprenticeships.

What is the Institute for Apprenticeships and Technical Education?

The Institute for Apprenticeships was established in May 2016 by the Enterprise Act 2016 and went live in April 2017. The aim of the Institute was to ensure high-quality apprenticeship standards and to advise the government on funding for each standard.

The Technical and Further Education Bill 2016-17 expanded the remit of the Institute to cover all technical education. In January 2019, the Institute took over responsibility for the T Level programme and became the Institute for Apprenticeships and Technical Education (IfATE).

The Institute is an executive non-departmental public body, sponsored by the Department for Education.

What is Skills England?

Skills England is a new body that was launched in July 2024. The government has said that it will take on the functions of the Institute for Apprenticeships and Technical Education, while also having an expanded remit to look at skills gaps and demand.

Skills England was established on 22 July 2024 in shadow form within the Department for Education, with the aim of fully establishing it in phases over the following 9 to 12 months.

In the King’s Speech, the government set out its intention to bring forward legislation to transfer functions from IfATE to Skills England.

The Institute for Apprenticeships and Technical Education (Transfer of Functions etc) Bill would transfer functions from the Institute to the Secretary of State, rather than to Skills England. This is because Skills England will be established as an executive agency within the DfE, while the Institute is a non-departmental public body.

Skills England will take over most of the functions that are currently carried out by the Institute. However, Skills England will have a wider remit than the Institute. The government says that Skills England will work to identify where skills gaps exist, and work with the Industrial Strategy Council and the Migration Advisory Committee to address these.

What would the bill do?

The bill would:

• abolish the Institute for Apprenticeships and Technical Education (‘the Institute’)
• transfer functions from the Institute to the Secretary of State
• transfer property, rights, and liabilities from the Institute to the Secretary of State

The bill will also make additional changes to the current skills system, including:

• giving the Secretary of State additional powers over occupational standards and apprenticeship assessments
• removing the requirement for reviews of technical educational qualifications, occupational standards, and apprenticeship assessment plans to be undertaken at regular intervals
• giving Ofqual the discretion to exercise its accreditation power for technical education qualifications when deemed appropriate by the Secretary of State

The government has said that transferring the Institute’s statutory functions to the Secretary of State and introducing more flexibility to the skills system would make it more agile and responsive to the needs of employers and the economy.

The government says that the Secretary of State would delegate most of the Institute’s previous functions to Skills England.

A government amendment made in the Lords would introduce a new clause requiring the Secretary of State to lay before Parliament and publish a report about the exercise of functions conferred or imposed on the Secretary of State by this bill.

A subsection was also introduced by the Lords, without government support, that inserted a one-year delay between the establishment of Skills England and the commencement of the legislation.

What happened in the Lords stages?

There was cross-party support for the bill in principle in the House of Lords. Members of the House of Lords were supportive of the introduction of Skills England.

Key topics of discussion during the House of Lords stages included:

• Skills England’s role as an executive agency within the Department for Education, and the functions that would be transferred to it from the Institute
• the power that would be given to the Secretary of State in preparing occupational standards and apprenticeship assessment plans
• the effect of the removal of the requirement for reviews of technical educational qualifications, occupational standards and apprenticeship assessment plans at regular intervals, and removal of the requirement for independent third parties to examine occupational standards and apprenticeship assessment plans before approval
• whether the Apprenticeships, Skills, Children and Learning Act 2009 should be amended to allow the Secretary of State to allow Ofqual to exercise its accreditation power for technical educational qualifications where deemed appropriate
• the reporting requirements of the Secretary of State and Skills England
• Skills England’s functions and responsibilities
• how the government would address potential delays when the Institute’s functions are transferred to the Secretary of State
• the power the government will have to make consequential changes to acts other than those specified in the provisions of the bill

Amendments were made at the Lords report stage (see above).