Urgent reform of the Government’s apprenticeship programme is needed if it is to succeed, a report by MPs has warned.

The Business, Innovation and Skills Committee report into apprenticeships, which follows an 11 month review of the government’s apprenticeship programme, warns that the delivery programme is still too complex and the sheer number of organisations involved works against efficient allocation of funds.

It is calling for a smaller and more efficient delivery system, which focuses on quality rather than the number of people signed up. “While we welcome the expansion in apprenticeship starts, the success of the apprenticeship programme should not be judged by numbers alone,” the report says.

“We support the significant increase in apprenticeships, but there is a risk that the rapid expansion may result in the programme becoming less focused. For that reason the Government needs to clearly articulate the overarching strategy and purpose of the apprenticeship programme,” the report adds.

BIS is also urging the Government to demonstrate value for money in the programme, warning that there is insufficient data to inform decisions on where funds are best allocated. This needs to be addressed as a matter of urgency, the report says.

Last year, the Government invested £1.2 billion into the apprenticeship programme. The same year saw 457,200 people start new training as an apprentice. However there remains an underlying assumption that vocational training is only for those unable to take an academic route. The report says the academic route and the vocational route should be given equal prominence in careers advice.

“The skills development of our workforce is a key component of long-term sustainable economic growth. It is therefore vital that the apprenticeship programme is fit for purpose and delivers a workforce which reflects the needs of employers. In particular, the UK cannot be satisfied with only providing entry level apprenticeships,” the report says.

Skills Minister Matthew Hancock said: "Apprenticeships are vital for equipping people with the skills they need to prosper, and the nation with the workforce we need to compete in the global race. The report rightly celebrates the sharp rise in the number of apprenticeships, and steps taken to improve their quality, but there is more to do.

On 11 June 2012 the Department for Business, Innovation & Skills and Education appointed Doug Richard, serial entrepreneur and early investor, to lead an independent review into the future of apprenticeships. He is expected to report on his findings and recommendations in the next few weeks.

The report says that Government, employers and schools need to be far more ambitious in expanding and delivering higher and advanced apprenticeships. It recommends that schools be required to produce information on apprenticeship starts alongside the number of students entering higher education.

Business lobby group the CBI said apprenticeships were vital to raising skill levels in our economy, but urged the Government not to heap further red tape onto businesses.

Neil Carberry, CBI Director for Employment & Skills, said: “Too many businesses are already turned-off by the scale of compliance required to get involved. Instead, we need a clear definition of the quality standard that apprenticeships should reach. And businesses need the Government to trust them to deliver apprenticeships, by giving them more control over the funding and content of courses. Too much of the current system delivers what the Government will fund, rather than what businesses need.”

Tom Wilson, Director of unionlearn – the learning and skills organisation of the TUC – said the issue of poor quality schemes still needed to be addressed. A BIS pay survey suggested that 20 per cent of apprentices are not receiving any recognised training. “We will continue to campaign to ensure apprentices receive both the pay and the training they deserve. This report is a great step towards achieving that,” Wilson said.

However, Wilson said the TUC did not agree with the report's support for the Apprentice Training Agency (ATA) model. “Frequently these offer poor quality schemes with low pay, only offering temporary work. They remove the responsibility for the apprentice from the employer. We believe that as a result, the ATA model will offer only the opposite of the clarity rightly called for elsewhere in the report."