Apprenticeship Levy: firms slow to act

By Rick Pendrous

- Last updated on GMT

ACS&T Logistics is taking on more young people to train as apprentices
ACS&T Logistics is taking on more young people to train as apprentices

Related tags Apprenticeship levy Apprenticeship Vocational education

Companies are being slow to take advantage of the new Apprenticeship Levy that came into effect in April, claims Bis Henderson Academy, which offers training programmes for supply chain and logistics professionals.

Such inaction could lead many businesses to miss out on the opportunities afforded under the scheme to upskill individuals across their enterprises, the company argued.

“Of those companies affected, we are seeing a third that have tangible plans to utilise their levy funds; a third that are thinking about it; and another third that are not active at all on the issue,”​ said David Lynch, md of Bis Henderson Academy.

Under the Apprenticeship Levy scheme – a tax raised at 0.5% of the total payroll bill on all firms with a wage bill that exceeds £3M – monies can be returned to the employer through an online account, along with an uplift of 10% from the government.

Delivery of apprenticeship-based training

The employer can spend the money, but only on the delivery of apprenticeship-based training offered through an approved training provider. Funds have to be used within 24 months, after which they expire.

Bis Henderson Academy, which claims to be one of the first companies to be accredited to the Register of Apprenticeship Training Providers, suggested that businesses needed to start thinking in terms of ‘funded development’ when it came to the scheme.

Organisations should actively consider where they can use apprenticeship-based training to complement their future needs and to replace some of their existing training budgets, said the company.

“If you aren’t yet doing anything to take advantage of the funds that are already starting to accumulate, then you ought to be,”​ said Lynch. “The money being paid out in increased tax isn’t gone – companies can spend it today.

‘Maximise the value they can gain’

“We are working with a range of clients to enable them to maximise the value they can gain from their Apprenticeship Levy contributions – advising them on upskilling their managers, first line team leaders, as well as warehouse operatives, supply chain professionals and customer service teams. We are creating and delivering schemes to enable our clients to get real benefit from this policy, immediately.”

For many organisations, the first step is to start looking carefully at their current skills base and what core skills programmes they are involved in, whether at an operational, supervisory, management or even board level, Lynch added.

The key is to find or create the right apprenticeship standards that will achieve those training goals using Levy funds, he said. That might be across a raft of levels, from the basic NVQ Level 2, right the way up to a degree apprenticeship at level six or seven.

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