Apprenticeship Levy comes into force today

The Apprenticeship Levy comes into force today as companies with a wage bill of £3M or higher required to contribute 0.5% of their employee cost to the scheme the government hope will see three million apprenticeship starts by 2020.

The government say the money generated will be invested in providing quality training for apprentices and will see the annual investment in apprenticeships double to £2.5Bn by 2020 in comparison to 2011 levels.

It is hoped that the levy will encourage employers to see the benefit of offering apprenticeships and help more people get on the path to a rewarding career.

Skills Minister Robert Halfon said: “More than 90% of apprentices go into work or further training, and the quality on-the-job training on offer will make sure we have the people with the skills, knowledge and technical excellence to drive our country forward.

“Building an apprenticeship and skills nation is essential in ensuring that we have the home-grown workforce we need in post-Brexit Britain to address the skills shortages facing industry and give everyone the chance to succeed.”

For those companies with an annual wage bill of less than £3M, the government will contribute 90% of the costs of training and assessing their apprentices.

Smaller companies who employ less than 50 people that take on an apprentice aged between 16 and 18 will see 100% of their training costs paid for.

Neil Carberry, CBI Director for People and Skills policy, said the Apprenticeship Levy would only be a success if the focus was on the quality rather than just the number of employees.

Mr Carberry commented: “For the Levy to be a success, it must deliver long-lasting careers and close skills gaps, not just create more apprenticeships.  Shifting the focus onto quality is essential to delivering much needed stability to England’s skills system, that’s why business is focused on helping the Institute for Apprenticeships get this right.

“As it stands, there is a genuine risk that firms aren’t going to be able to use their funds if the system does not deliver the training apprentices need.”

Peter Vinden, Managing Director of The Vinden Partnership – a leading multi-disciplinary consultant company to the built environment, said: “The desire to produce home grown talent to fill the skills gap is one we can all get behind. Creating more apprentices is a positive step but we need to be certain that the investment is being used wisely and that the construction industry will be getting quality employees with the required skill sets at the end of it.”

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