Crackdown after fury over taxpayer-funded MBA university courses for top executives

Keir Starmer has announced a crackdown on the use of taxpayers’ money to fund university courses for top executives – in a victory for an Independent campaign.

Ministers were under pressure to act after this publication revealed that more than £1bn of taxpayers’ money was being used to fund master’s-level courses for top executives.

Now in an overhaul of the apprenticeship levy, the prime minister is announcing a shake-up to restrict its use for postgraduate courses.

He used his speech at the Labour Party conference to say he would “rebalance funding in our training system back to young people”.

Experts have warned the courses are not what the scheme was designed for and mean new entrants to the labour market are losing out.

The levy was launched with great fanfare by Tory ministers in 2017. It charges larger businesses 0.5 per cent of their wage bill which they can use to recruit and train apprentices. Any of the levy that remains unspent after two years is returned to the Treasury.

But the number of entry-level apprenticeships, which are equivalent to five GSCE passes, have more than halved, from 53 per cent of the total five years ago to 24 per cent.

Last year one former education secretary warned that part-subsiding MBAs for high earners raking in more than £100,000 a year “makes a nonsense” of the apprenticeship levy.

Over 55,000 executives from hundreds of large companies have received 100 per cent funding to take two postgraduate level apprenticeship standards that are equivalent to a master’s degree but badged as apprenticeships.

Former Labour education secretary Alan Johnson said the system should be reformed. “This makes a nonsense of the objectives of the levy. It was to help young people into work not help executives onto the gravy train,” he said.

At the top end of the scale, an estimated £100m of the apprenticeship levy has been used to help fund top earners to study for an executive MBA.

Ex-Tory education secretary Gavin Williamson called for the government to look at the levy “afresh” as funding MBAs was “not in the spirit of what the apprenticeship levy was set up for”.

The Independent first exposed how £300m of levy funding had been used to fund 21,000 senior leader apprenticeships in the five years to August 2022.