Rohan Sivajoti: Why Ofsted criticism of the SimplyBiz Academy missed the point

Ofsted's recent assessment of SimplyBiz's New Model Business Academy is another example of how the education regulator and government fundamentally misunderstood our profession from the outset when they created the current apprenticeship standards. 

It has been reported the primary point of criticism from Ofsted was that the New Model Business Academy "doesn't focus sufficiently on building skills and behaviours in the first 12 months", instead preferring to focus on passing exams. The report states that apprentices "do not have sufficient opportunity to develop their skills and behaviours and apply them in the workplace until they have passed all their examinations".

This is where the apprenticeship model and financial services regulation are at odds - and it is also why it was always going to come to this. Apprenticeships require a structure that sees participants simultaneously building skills, knowledge and behaviours, and these are assessed on an ongoing basis by the accredited training provider.

For the apprentice to be successful, the end point assessment requires the core qualification to be passed (Level 4 diploma in the case of the financial adviser apprenticeship) and the apprentice to demonstrate that they have developed the skills and behaviours to be able to do the job competently via completion of a financial advice case study and delivery of a portfolio of evidence, which is assessed at interview. 

The portfolio of evidence is required to demonstrate practical competence in all aspects of the financial advice process, and the case study tests a real life scenario involving a variety of planning needs. In order to complete these, the apprentice needs the basic knowledge provided by achieving level 4 diploma.

In addition, in order to demonstrate competence in these skills in the field, most firms would expect an apprentice to have passed the level 4 diploma before being put in front of clients, even under supervision.

So the financial adviser apprenticeship was set up from the outset to fail if accredited training providers were to be assessed by Ofsted at any stage, other than very close to the end of the course. But accredited training providers have another challenge with the financial adviser apprenticeship, and that is one of funding.

The paraplanner apprenticeship was awarded a funding cap of £12,000. That apprenticeship involves four Chartered Insurance Institute (CII) exam modules. The financial adviser apprenticeship with six CII exam modules was only awarded a £9,000 funding cap.

Out of that, the accredited training provider has to pay for exam entry and course materials, which come to a little over £1,500 and an independent end point assessment costing around £1,800. That leaves the training provider just £5,700 to provide a 24-month programme and meet the costs of Ofsted and Education & Skills Funding Agency reporting and monitoring. 

The final challenge to the financial adviser apprenticeship was alluded to in the Ofsted report, which stated that "managers only review apprentices' performance in exams". This was always going to be the biggest long-term challenge to the success of the financial adviser apprenticeship. This is because the end-point assessment takes place after the qualification standard has been met.

As a result, there was always a risk that many employers would prefer to focus on the core business, rather than completing end-point assessment, because a level 4 diploma is seen as a more recognised attainment level. This has been borne out by conversations with other accredited training providers who are reporting high levels of non-completions among their financial adviser apprenticeships.

As accredited training providers, and ultimately the whole financial adviser apprenticeship standard, are judged by the number of successful completions this can only put more downward pressure on future funding of this standard. 

At NextGen Planners we chose not to utilise apprenticeship funding for exactly the reasons stated above. However, we care about the profession and sympathise with the challenges that New Model Business Academy and others in the training community have.

Financial advice has a huge demographic challenge over the next ten years and we need as many access points to the profession as possible to bridge the succession gap - and we believe that apprenticeships should be part of that.

Rohan Sivajoti is director of Postcard Financial Planning and co-founder of NextGen Planners

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