Dispatches investigation uncovers Next misuse of apprenticeships

An investigation from Channel 4 entitled Low Pay Britain has revealed that high street giant Next exploited the government’s apprenticeship programme, saving nearly £2.5m this year from underpaying young learners and holding back on proper training.


Under investigation

The programme, which aired on Channel 4 on December 7th, looked into the government’s apprenticeship plans, specifically its apprenticeship levy on all large businesses and the Conservative’s plan to hire an additional three million apprentices by 2020.       

Dispatches journalist Seyi Rhodes (pictured below) asked the question: ‘who is really gaining from the growth in apprenticeships -young people, or their employers?’

In order to fix the UK’s widening skills gap, Channel 4 claimed that Osborne and co has ‘fallen in love with an old idea’ and is now championing the power of apprenticeships.

The programme kicked off by noting that despite the national living wage continuing to rise, an apprentices’ wage currently stands at a measly £3.30.

The investigation picked holes within BIS’ apprenticeship programme, highlighting some of the menial jobs up for grabs, including a fish frying apprenticeship and a bar apprenticeship.

Most of the apprenticeships on offer are within the retail sector, and some of the biggest names in the industry are taking advantage of this employment loophole.


Underpaying their young staff

Clothes and home wear retailer Next has 500 stores across the UK and recorded £800m profit this year.

Simon Wolfson, CEO of Next and son of former Next chairman David Wolfson, Baron Wolfson of Sunningdale, was revealed to have donated over £500,000 to the Conservatives over the last ten years.

Wolfson is now under heavy criticism after it was found that some Next apprentices started their career on a wage as low as £2.65. Speaking to one Next apprentice, Rhodes discovered that the ‘first class’ training that was being advertised to aspiring apprentices wasn’t being carried out.

Former apprentice Alex Harding told Dispatches that he received ‘very little one-on-one training’ due to the small size and heavy demands of the store.

Another apprentice, Becky Markham, who was only being paid £4.52 an hour, said that her bosses were sacrificing apprenticeship training in order to hit targets set by head office. Markham said it ‘felt like a normal job, not an apprenticeship’.


Taking taxpayer’s money

Dispatches calculated that Next has saved nearly £2.5m in wages this year through paying their apprentices a wage lower than £6.70, the national minimum wage for people 21 and over.

It was also revealed that Next has received nearly £1.8m from the taxpayer in 2015 for training their apprentices. As they now receive government funding, Next was put under investigation by education watchdog Ofsted.

In July, Ofsted’s first report into the clothing chain found that there was ‘inadequate’ support provided towards its apprentices, which meant that too many of its young learners were withdrawing from their learning.

A spokesman for Next has responded to the report, stating: “We were very disappointed with our first Ofsted inspection and completely accepted the report’s findings and recommendations back in July.

“We immediately commenced a vigorous programme of improvements and as such our recent monitoring visit from Ofsted was much more positive. Going forward we will not be taking on any more Apprentices until we achieve a much improved inspection,”


‘More structured and transparent process’

The Skills Funding Agency (SFA) has since suspended Next from hiring any more apprentices, but the retail firm is still receiving taxpayer’s money for training their current batch of young learners. Next is set to receive an extra £1.4m for its apprenticeship training by the end of the year.

Since Ofsted’s damning report, the retail firm has said that it’s taken steps to help its apprentices, including an increase in pay which has raised its apprenticeship completion levels to 76 per cent.

The Association of Employment and Learning Providers (AELP) spoke exclusively to Apprentice Eye regarding the programme, and has called for the SFA to treat independent training provider’s the same as they would treat schools and colleges.

“AELP has always said that the intervention policy for ITPs should reflect the same principles as that used for colleges and employers where the provider is given a period of time to address the issues found at inspection,” said an AELP spokesperson.

“The key driver should always be what is best for the learners and the employers. We need a fairer, more structured and transparent process for managing poor performance across all types of providers.”