Apprenticeship levy bashed by UK businesses
Business groups took a fresh swipe at the government’s apprenticeship levy today as the latest figures revealed a plunge in new starts this year.
The number of new apprentices has slumped by 31 per cent year-on-year during the academic year so far, Department for Education data showed.
There have been 315,900 apprenticeship starts reported to date between August 2017 and May 2018 for the 2017/18 academic year, down from 457,200 last year. The levy, a 0.5 per cent tax on employers with annual paybills over £3m, was brought in by previous chancellor George Osborne, who said he wanted to see 3m people start one of the training programmes by 2020.
From May 2015 to April 2018 there have been 1.4m apprenticeship starts reported, leaving another 1.6m apprenticeships for the government to hit its target.
Edwin Morgan, director of policy at the Institute of Directors, said the government’s target is “sinking below the horizon” and said the levy is “still not delivering as it should for employers or apprentices”.
The British Chambers of Commerce said the system needs urgent reform.
The apprenticeship levy has faced criticism from businesses for the difficulty in accessing the funds, as well as problems with access to apprenticeships which are still in development.
Colin Stanbridge, chief executive of the London Chamber of Commerce and Industry, said he is “very concerned at the low take-up of apprentices”.
“We believe that the working of the apprenticeship levy in the capital must be reviewed, to make it far more effective for employers and in terms of labour market outcomes,” he added.
The Department for Education said it was pleased that the drop in starts had slowed. Apprenticeships and skills minister Anne Milton said the government has focused on higher-quality apprenticeships. She said: “I’m pleased to see the number of people starting our new high-quality apprenticeships – created in partnership with businesses and employers – continuing to rise.”