Apprenticeship Levy needs overhauling, claim trade groups

By James Ridler contact

- Last updated on GMT

Davidge: 'Today's report confirms what industry already knows; the Apprenticeship Levy is not working'
Davidge: 'Today's report confirms what industry already knows; the Apprenticeship Levy is not working'
The Government’s Apprenticeship Levy needs overhauling to really deliver for manufacturers, according to trade association comments following a hard-hitting report criticising the Levy system.

The report by the National Audit Office (NAO) found that the Levy had a long way to go before it could demonstrate it was achieving value for money, or that resources were being used to best effect.

“Since introducing its reforms the Department has improved how it assesses the benefits of the programme,”​ said the report. “However, it has not set out clearly how it measures whether the programme is boosting economic productivity – the ultimate aim of the programme.”

Commenting on the NAO report, a spokeswoman for the Food and Drink Federation said: “The levy presents an opportunity for positive change and an increase in productivity, giving employers the tools to invest in skills needed, both by bringing in new talent and upskilling our existing workforce. However, increased flexibility in the current system would enable the levy to really work for our industry as well as the economy as a whole.

Extension needed

“It will take time to build sustainable provision that is sector specific. This is why an extension to the expiration of levy funds is needed for those employers with standards which are still in development, or for those who do not have access to suitable training provision yet. Employers also need to be able to work closely with training providers to find solutions to deliver 20% ‘off the job’ training that meets the needs of business.     

“Government has to work closely with industry to raise awareness on the availability and suitability of standards to ensure employers of all sizes are informed customers. Under the Food and Drink Sector Council, the food chain has come together to develop longer-term solutions to secure skilled talent in the future and in particular maximise the use of the Apprenticeship Levy.”

Verity Davidge, head of education and skills policy at Make UK (formerly EEF, the manufacturers’ association), said: “Today's report confirms what industry already knows; the Apprenticeship Levy is not working.

“Manufacturers have always been true champions of apprenticeships, but the Government's reforms have left many deeply frustrated. With one in ten manufacturers actively delaying or cancelling apprenticeships because of the Levy and 95% saying the Apprenticeship Levy must be changed, it’s no wonder that starts have taken a nosedive.”

Davidge applauded the move towards higher-level apprenticeships, but warned that the need for a pipeline of trained staff from shop floor to “top floor” ​roles should not be ignored.

Staff shortfalls

There has been an increasing shortfall in technician level roles, which has continued since the introduction of the Levy, which, combined with the changes in the labour market driven by Brexit, will have a hugely detrimental effect.

“Government needs to stop tweaking around the edges and use its current review to really listen to employers and make a radical change and make it quickly. With an evermore uncertain Brexit on the horizon, we cannot afford to wait around to see if the programme will improve on its own.”

To read the NAO’s full report on the Government’s Apprenticeship Levy, click here.

Meanwhile, the Food & Drink Training and Education Council (FTC) is calling for employers and apprentices to have their say on the L2 Butcher Apprenticeship Standard​.

Related topics: People & Skills

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