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Small businesses to receive leftovers of apprenticeship levy funds

29 Jan 16  | Recruitment News
Small businesses to receive leftovers of apprenticeship levy funds

Small businesses will receive the leftovers of the apprenticeship levy - which will be raised at a rate of 0.5% of large employers’ (fewer than 2% of UK employers qualify) paybills - once big employers have used up their shares, it was confirmed this week by Skills Minister Nick Boles.

At an evidence session for the Education, Skills and Economy Sub-Committee, Boles spoke to MPs about subjects including apprenticeships and the levy, careers advice and the Institute for Apprenticeships.

“While it will be possible for any employer who pays the levy to use their contribution on their own apprenticeship[s,] across the economy we don’t expect all employers to use all their money,” Boles said. “The levy money that is not used by those employers who have paid it will then effectively be recycled to support the apprenticeships of those employers who don’t pay the levy.”

In the government’s December ‘English Apprenticeships: Our 2020 Vision’ document, it was stated that ‘where employers choose not to use the fundswe will make these more widely available’, but Boles’ statement is the first clarification of what this actually means.

Mr Boles also spoke of the new Institute for Apprenticeships, describing it as having a ‘very important role’ as the ‘guarantor of quality in the apprenticeship system.’

“It’s going to take over from government the role of approving apprenticeship standards, of approving the assessment regimes that operate with apprenticeships – the end point assessments – and of guarding the quality of the apprenticeship programme,” he said. Explaining the composition of the board being ‘mainly business leaders’, he reasoned that “it’s important that [the businesses] feel they are in control of what they are being required to invest in”.

This confirmation of the availability of leftover apprenticeship funds for smaller businesses could represent a major boon for small start-ups in the UK, allowing them to take on promising new apprentices and train them up themselves, rather than relying on the larger bodies and losing out on the chance to secure the bright sparks of today.

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