Six months after its introduction, businesses remain in the dark
about how best to utilise the Apprenticeship Levy, according to a
survey released today (Friday) by the British Chambers of
Commerce (BCC), in conjunction with Middlesex University London.
The annual workforce survey of over 1,400 businesses found that
nearly a quarter (23%) of levy-paying firms have no understanding
of the Apprenticeship Levy or don’t know how their company will
respond to it.
Businesses with a pay-bill of less than £3m fall under the levy
threshold but can still apply for apprentice funding, yet the
findings of the survey show 66% of these companies haven’t taken
any direct action to use the funds or don’t know about it.
For over half of levy-paying businesses, it represents an added
cost, with 56% not expecting to recover any or only a portion of
their payment, compared to 36% who expect to recover all or more
of their payment.
The findings reinforce the need for clearer guidance and support
for businesses wanting to utilise the Apprenticeship Levy. Firms,
both above and below the levy threshold, are uncertain about how
to use the funds to find and train the skills they need,
undermining the purpose of the system.
Jane Gratton, Head of Business Environment and Skills at the BCC,
said:
“Apprenticeships are great way for businesses to develop the
skills they need for the future, but they are not the only
solution for developing people in the workplace. The current
upheaval in the technical education and apprenticeship system
will take time for firms to understand and adapt to.
“The government must ensure that changes in the system do not
lead to a slowdown in the overall number of apprentices
recruited, or less investment in other forms of workplace
training. Low awareness and understanding of the Levy has not
been helped by uncertainty faced by training providers tasked
with delivering apprentices to business.
“For many businesses who pay the Apprenticeship Levy, it can feel
like an additional employment tax, much of which they are unable
to recover, and one that is deflecting training budgets away from
other important training needs. Firms need greater flexibility on
how they can use their levy monies and a system that is fully
operational as quickly as possible, is simple and efficient, and
that enables them to access good quality training.
“Our survey shows that many firms are still unaware of the
Apprenticeship Levy and how it will impact on their business.
With many companies across the country facing critical skills
shortages, more information and support is required to ensure
businesses continue to invest in training.”
, Director of Corporate
Engagement at Middlesex University London, added:
“It is clear that better information is needed to make sure the
huge benefits of apprenticeship programmes are recognised by
business, including how they can maximise the levy, the array of
qualifications and levels that can be studied through
apprenticeships, that the opportunity applies to existing staff
as well as newcomers, and that innovative delivery methods mean
that an employee could be out of the workplace for as little as
12 days a year.
“The opportunities that arise from the apprenticeships levy -
together with robust workforce planning - could be transformative
for businesses so it is essential that gaps in information and
support around this initiative are addressed.”
