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”
