Hospitality industry urged to act over apprenticeship levy proposals

Cornwall College St Austell pastry kitchen

Training provide People 1st is calling on industry to have its say on the newly proposed apprenticeship levy to help lessen its impact or risk facing a potentially complex and unmanageable system. 

Employers, associations and training providers are being urged to contribute to a united, sector-wide response to help minimise the effect of the government levy, brought about to fund the new wave of apprenticeships.

The move, described by Chancellor George Osbourne as a “radical, long overdue” approach to apprenticeship funding, will see large employers contribute the most, with a separate, as yet unannounced, arrangement for smaller businesses.

The government is yet to provide details for what it defines as a ‘large employer’, although People 1st expect this to be 250+ employees.

The Confederation of British Industry (CBI) has suggested that the levy will see employers contribute 0.5% of payroll, regardless of whether they engage with the new-look apprenticeships; a figure, which, for some, is considered too high.

People 1st estimates that this could end up costing sector businesses in excess of £100m, and has joined calls from employers for a more straightforward levy system in which the sector plays a leading role.

A public consultation is set to run until October 2nd 2015. Simon Tarr, chief executive of People 1st, says it’s important that the sector is well represented to government.

He comments: “It’s our concern that without sufficient input from the very businesses this levy is set to affect, some of the suggestions made in the government’s consultation could result in a complex and unmanageable system over which employers will have only limited control.

“Spring 2016 will see the introduction of a wave of new, simpler, more robust apprenticeships – designed and perfected by our trailblazer employers to provide fantastic career pathways. Figures suggest that employing apprentices can boost retention by up to 77% and have an extremely positive impact on the bottom line, yet fewer than 10% of businesses are using apprenticeships.

“If the levy is implemented and managed appropriately, this represents a huge opportunity for the industry to build a pool of talented staff that will help address key challenges including productivity and retention, and for businesses to achieve a return on investment through the many benefits that employing an apprentice offers”

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