By Shelley Measures, Feb 28 2019 03:58PM
The Apprenticeship Levy was established just under two years ago to help employers to build a skilled workforce fit to “compete on the world stage”. However, not everyone is making the most of the opportunity…
In a bid to hit its declared target of training three million new apprentices by 2020, the government introduced the Apprenticeship Levy in 2016.
How does the Apprenticeship Levy work?
Effectively a tax on big business, the levy, which came into effect in April 2017, requires a spend of 0.5pc of the company payroll by firms paying more than £3m a year in salaries - fewer than 2pc of UK employers.
Does the government pay for apprenticeships?
The government slightly eased the burden by introducing a levy allowance of £15,000 a year, to be subtracted from the 0.5pc total.
Also, as well as the amount paid into the account, the government applies a 10pc top-up on funds, so that for every £1 paid in, the employer gets £1.10 to spend.
The purpose of the levy is to encourage employers to invest in apprenticeship programmes and develop their workforces.
Is there an Apprenticeship Levy deadline?
The catch is that businesses have been allowed 24 months to spend their funds before they expire.
And it is estimated that of the projected £2.7bn levy pot across all industries, just £370m (13.7pc) has been drawn down to fund courses, according to Department for Education (DfE) data.
March will mark 24 months since the levy was introduced, and under government rules any unspent levy from March 2017 will be lost on a rolling monthly programme, decreasing the funds in the employer’s levy pot.
This means that businesses need to act now or lose out.
How can CAKE help?
CAKE People Development believes in helping clients to develop and deliver their learning and development strategy via modern, innovative and blended learning Director Margaret Burnside says: “In April, the businesses which are paying the levy, but who haven’t spent it, will start to lose it and the funds will be gradually returned to the Treasury.
“We are here to support those organisations, to help them understand that the levy is a platform to engage with staff across all levels of the business to help them develop in their roles.
“Meanwhile, apprenticeships, whether in leadership and management or learning and development, offer opportunities for structured, professional learning, leading to recognised qualifications.”
Where can I find out more about apprenticeships?
Apprenticeships are a huge opportunity for organisations to develop the performance and capabilities of their teams. It shouldn’t be seen as just an entry level or school leaver pathway.
A range of optionsare available to employers seeking to make the most of the levy, join us April 2nd to find our more.
Or email firstname.lastname@example.org to find out how CAKE People Development can help find the right solution for your apprenticeship requirements