Uk Apprenticeship Levy Considered a Mistake

Business leaders have argued that the UK government’s apprenticeship levy is a £3.5bn mistake and should be scrapped. They argue that the funds are not being used effectively to increase the recruitment of apprentices or improve quality, but instead are being collected by some employers and then put back into general funds.

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The levy was introduced in 2017 to double the number of high-quality apprenticeships over five years. However, after three years, the number of people taking up these roles has remained the same according to official figures, prompting business groups to rethink how the funds are being spent.

It is estimated that between April and October 2019, only 1.7% of companies received any levy funding for apprenticeships, with the majority receiving nothing. This suggests that employers need to take advantage of the funds to invest in training programmes and improve their workforce.

Business leaders have argued that a better solution would be for the government to increase its apprenticeship spending and allow businesses to use grant-based funding rather than being forced to stump up money from their resources. They believe this would be more beneficial in increasing recruitment numbers and improving quality- particularly crucial in sectors such as IT, engineering and construction, where skills shortages are causing problems.

The debate around how best to use the levy shows no signs of abating, but it’s clear that business leaders are feeling frustrated by the need for more progress in using the funds for its intended purpose. With a new Conservative government now in power, it will be interesting to see what changes they make – if any – to the levy system and how this impacts apprenticeship recruitment and quality in the years ahead.

Time will tell whether or not these suggestions are taken on board, but one thing is for certain – employers need reassurance that their money is going towards something worthwhile. Otherwise, they may choose to look elsewhere when it comes to investing in the future of UK businesses. It is clear that with a shift away from the current apprenticeship levy model, we can take advantage of an invaluable opportunity to improve skills levels across the nation.

What do you think of the suggestions?