Apprenticeships are not viable for many advice firms already struggling with meeting regulatory obligations and cost, an adviser has said, as new figures showed the number of apprenticeships has fallen since the government's introduction of a dedicated scheme.
Stuart Feast, a financial adviser at St Albans-based Feast Noble & Company, told FTAdviser the industry has changed dramatically over the past 30 years and apprenticeships were no longer viable for many businesses.
He said: "For us, apprenticeships are just not viable. You put a lot of effort and time into someone and I’m afraid that it never seems to bare any fruit. The majority of people that I know working as IFAs think the same thing.
"We are so bogged down with the cost of regulations that allocating costs and time to a good apprentice would be very difficult to justify.
"If we were going to recruit now, we would look at somebody who has already done their apprenticeship and is a fully-fledged qualified adviser."
The comments come as research showed the government's apprenticeship policy, introduced in 2017, has seen a fall in apprenticeships.
Research from tax and advisory firm Blick Rothernberg found there were 290,500 UK apprentices between August 2017 and April 2018, compared with 446,900 in the same period a year earlier.
In April 2017, the government introduced rules requiring that employers with a payroll bill exceeding £3m pay an apprentice levy.
They are eligible to draw down against this, if they take on apprentices.
However, Andrew Sanford, a partner at the firm, said many companies have regarded this as yet another tax on business.
He said: "It is disappointing that the majority of employers regard the apprenticeship levy as a tax rather than a means of providing accessibility for training the young. Urgent reform of the levy system is required in order for the government to reach its stated aims."
He added: "The fall in the number of apprenticeships is at odds with the stated government aim of funding 3,000,000 placements by 2020."
But the government pointed to a "big increase" in the number of people starting on "high-quality" apprenticeship standards – 119,500 were reported in the first three quarters of 2016/17 in comparison to 11,000 reported at this time last year – an increase of 986 per cent, it said.
It added more than half of starts in May 2018 were on the new, high-quality apprenticeship standards.
Apprenticeship standards, which are being developed by employer groups known as 'trailblazers', show what an apprentice will be doing and the skills required of them.
Apprenticeships and skills minister Anne Milton said: "Our reforms have driven up investment in the quality of apprenticeships to build skills and give people more opportunities to succeed.
"I’m pleased to see the number of people starting our new high quality apprenticeships – created in partnership with businesses and employers – continuing to rise."
She added: "In the last 12 months more than 100,000 more people have started these new apprenticeships, putting them on the path to success in a range of cutting-edge and exciting industries such as aerospace engineering, nuclear science and architecture.