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Government apprenticeship levy could threaten training, say employers

02 October 2015 by
Government apprenticeship levy could threaten training, say employers

A levy proposed by the government in a bid to encourage training investment could actually lower apprenticeship quality and damage other forms of training, employers said today.

In a survey of 275 employers by HR organisation CIPD, 39% were in favour of the levy in principle, while 31% were opposed and 30% undecided. Consultation on the levy closes today (Friday 2 October).

Chancellor George Osborne announced the move in his last Budget, saying it was a "radical, long overdue" approach to apprenticeship funding. The proposals would see large employers contribute the most towards funding apprenticeships, with a separate, as yet unannounced, arrangement for smaller businesses.

Almost a third (30%) said that the levy would encourage them to build an apprenticeship programme, but 31% said that it would cause them to reduce investment in other areas of workforce training and development. A similar proportion (30%) said the levy would boost the number of apprenticeships, but just one in five employers (20%) said that it would drive up their quality.

The report also led the CIPD to recommend that the government focus more funds on level 3 and above apprenticeships, and should help foster links between universities and further education institutes to develop higher-quality apprenticeships.

The findings come days after People 1st warned the levy could cost the industry over £100m.

CIPD chief executive Peter Cheese, said: "The government has rightly focused on the need to increase the quantity and quality of apprenticeships in the UK and is hoping the levy will lead to increased investment by employers in these schemes. However, our survey suggests that boosting both numbers and quality at the same time will be a significant challenge."

He added that although apprenticeships were important, people's skills still needed to be used effectively in the workplace, and this would need longer-term workforce investment, and continued skills development over time.

Ben Willmott, head of public policy at the CIPD, said: "The introduction of the levy must be used as an opportunity to focus on raising quality levels so that apprenticeships are regarded as a viable alternative to university and not seen as a poor second choice for academic under-achievers."

People 1st warns apprenticeship levy could cost hospitality £100m+ >>

Viewpoint: Hoteliers must join forces in embracing apprenticeships >>

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