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Most firms call for apprenticeship levy replacement

More than half (53%) of employers who pay the apprenticeship levy would prefer a training levy, according to a study.

The apprenticeship levy, which has been in effect since 6 April 2017, means businesses with an annual pay bill of more than £3 million must pay the levy towards apprenticeship funding.

The levy is charged at 0.5% of the annual pay bill, and each employer receives an allowance of £15,000 to offset against their levy payment.

But the Chartered Institute of Personnel and Development (CIPD) polled more than 1,000 employers and found that only 17% of levy-paying firms support the existing apprenticeship levy.

The research reflected many employers’ doubts about how effective the levy really is for funding the training of apprentices.

Lizzie Crowley, skills adviser at the CIPD, said:

“Apprenticeships are extremely important, but other forms of training are equally valuable and often more flexible and better suited to the needs of organisations.

“A move to a more flexible training levy would have the effect of continuing to prompt greater employer investment in skills, including apprenticeships, but in a way that is much more responsive to employers’ needs.”

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