Consultation published on Apprenticeship Levy

On the 21st August, the government launched a consultation on its anticipated introduction of an apprenticeship levy that will allow employers to choose and pay for the apprenticeship training they specifically want.

As there has been a slight decrease in employers using apprenticeships, the government intends the levy to counter this decline and put investment in training, and apprenticeships specifically, on a long-term, sustainable footing. The levy will support people of sixteen and over and will provide the funding to employers who can use this to meet their individual needs.

To fund these apprenticeships, employers in England will receive vouchers in order to pay for the training. The levy will apply to larger employers across the UK. As skills training, including apprenticeships is a developed policy in Northern Ireland, Scotland and Wales, employers in England will receive vouchers to spend on apprenticeship in England. The levy will be collected from large public and private employers in the UK and employers will have complete control over their apprenticeship funding which will be achieved through a digital voucher system.

The Construction and Engineering Construction Sectors   When it comes to the new apprenticeship levy, it is slightly different in terms of the construction and engineering industries. Companies in these sectors currently pay training levies; the new apprenticeship levy will be economy wide and larger employers in the construction and engineering industries will be in scope of the levy alongside all other larger employers, the government considers there are two options:

Employers in the construction and engineering construction industries could continue to pay the new apprenticeship levy. If this were to happen the government would expect those employers to fund their apprenticeship using the new apprenticeship levy.

The industry levy arrangements could be removed, so that employers only pay the apprenticeship levy. This would represent a significant change to existing training arrangements and the government would need to understand what effects this would have on the skills and capabilities in the UK construction industry.   In addition, the industry Training Boards will consult with employers before the introduction of the apprenticeship levy on whether they should continue to pay this.

More information and detail on the apprenticeship levy rate and scope will be announced as part of the Spending Review in the autumn. The consultation closes on the 2nd October 2015.

There are a number of strategies KBL consider a business could implement.  To find out more, contact the employment department today for a free no obligation discussion on 01204 527777.

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