Apprenticeship Levy must be well handled

14-Feb-2017 - Last updated on 14-Feb-2017 at 11:19 GMT

The Apprenticeship Levy is a big opportunity for manufacturers, said Justine Fosh

The impending Apprenticeship Levy provided a clear opportunity for businesses to review the skills requirements of their workforces and centralise their approach to training, Justine Fosh, chief executive at the National Skills Academy for Food and Drink (NSAFD) has claimed.

The levy, which comes into force on April 6, was a chance for companies to “really strategically review what is happening”, and look at age profiles across sites and skills shortfalls, said Fosh.

She was speaking at last month’s Food Manufacture Business Leaders’ Forum, held at the London offices of host sponsor DWF, and also sponsored by RSA Insurance Group, packaging specialist Charpak and analytical testing provider ALS Life Sciences UK.

Two other distinct levy strategies were emerging from businesses with which the NSAFD was working, Fosh said. “The first one I’ll call the finance director directive, where they are intent on getting the full value of the levy back.

‘Low hanging fruit strategy’

“The second one is a low hanging fruit strategy – where companies will use the levy funds to offset original training budgets put aside for areas such as accountancy,” she added.

Fosh used this year’s forum to highlight two recent levy amendments relevant to food and drink firms – that it can be used to train existing employees, and that there is no cap on people with previous qualifications.

“Both of these are important, because as an industry we tend to rely on people coming to our industry not as a first choice, but often later on in their careers,” she said.

Under the levy, companies with a wage bill of more than £3M will have to pay 0.5% of annual pay outgoings towards the scheme.

Exempted from the Levy

Firms will have two years to invest their levy payments in apprenticeships. Small to medium-sized enterprises exempted from the levy will be able to access funding for 90% of the cost of apprenticeships.

Jon Poole, chief executive of the Institute of Food Science & Technology, used the forum to warn of the impact the levy would have on the “squeezed middle” companies.

“The big players will have systems and frameworks in place to deal with it, and take advantage of it – while it won’t impact small business. So it’s the squeezed middle that’s the issue,” he said.

“I do worry about the complexity of the levy, but we are in exactly the same situation as all other sectors. The food sector has been on the back foot in terms of taking advantage of apprenticeships, and this is our opportunity to do something about it,” Poole added.

Fosh conceded that the success of the levy “absolutely relied” on having high-quality apprenticeships available.