Tony Stevens, CEO of Svensoni Paraplanning in Swindon, said he applauded the principle because he is a firm advocate of bringing young people in to financial services and Paraplanning, having recently recruited two teenage apprentices.
But there were a ‘host of practical problems’ with the new scheme, he said.
Although “anything which helps to bring talent into the industry is a good thing”, he said overall: “I would view it as A for effort, but the practicalities really let it down for most employers.”
He said: “Firstly it is one of the newly launched ‘trailblazer’ apprenticeships - these shift more of the cost burden on to the employer, with the employer getting a ‘discount’ based on the core training costs, rather than it being directly funded and additional ‘incentive’ payments recovered from the government only after a lengthy period.
“Apprenticeships already have a comparatively long period before hitting break even on cost, worsened by October's significant hike in the apprenticeship rate and adding further initial costs to the cashflow burden is likely to rule out most smaller employers.”
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Mr Stevens said: “Trying to find a training provider able to supply is likely also to be a major problem - for our location I contacted more than 20 training providers, and not one was able to provide the qualification to us - in fact when we contacted the National Apprenticeship Service, not only were they unable to suggest any training providers they were unaware of the qualification itself. As we are on the M4 corridor this does not bode well for anyone in a less accessible location.”
His firm, which employs 32 Paraplanners, recently recruited its second 17 year-old apprentice in the space of five months. Another 21 year-old was hired a year ago.
Encouraging more young people to step into financial services is “not just welcome, but necessary if the industry is to survive, never mind grow”, he said, given the demographics of the profession.
Mr Stevens said: “We have a number of apprentices, brought on under Business Administration apprenticeships. They complete this during their first year and by then will have seen the day to day practicalities of life in a financial services office, and then are able to make more solid decisions about where they see their future."
The apprenticeship received official approval from the Department for Business, Innovation and Skills last week. The initiative creates a benchmark for employees taking part in the Trailblazer Apprenticeship Scheme and has been sponsored by Aviva, Zurich, AXA Investment Managers and Schroders.