Ben Willmott, head of public policy at the Chartered Institute of Personnel and Development (CIPD) says the concerns regarding the levy in its current form are widespread across organisations from the private, public and voluntary sectors, and it is irresponsible for the government, particularly in a time of economic uncertainty in the aftermath of the referendum, to simply press ahead with a policy that is not fit for purpose.
The apprenticeship levy is set to go ahead as planned in April 2017.
‘Our research suggests the levy, in its present form, will undermine efforts to improve the quality of apprenticeships,’ Willmott adds. ‘This is a time where we need to be raising the status of apprenticeships, not pursuing a policy which will have the effect of devaluing the ‘apprenticeship brand’.’
‘There are the damaging unintended consequences of forcing employers to reduce investment in other areas of equally valuable workforce training and development, and to essentially ‘re-badge’ existing training as apprenticeships in many instances.’
This ‘one-size-fits-all’ approach will damage attempts to improve the UK’s workplace productivity and will not address the downward trend in employer investment in training in recent years, according to Willmott.
According to CIPD research, six in every ten apprenticeships created in the UK are only at Level 2, equivalent to just five GCSE passes. In addition, the percentage of apprenticeship starts for people aged under 25 has dropped significantly from 99.8 per cent of all apprenticeships to 57 per cent in the last decade, while just one fifth of starts at Level 3 were reserved for 16-24 year olds in 2014-15.
The CIPD’s report shows that while the number of under-25-year olds starting an apprenticeship has increased by 24 per cent since 2010, the number of over-25s increased by 336 per cent. The number of over-60s grew by 753 per cent, from just 400 in 2009–10, to 3,410 in 2014–15.
Sharon Walpole, CEO of www.notgoingtouni.co.uk, says that while the new levy does have its downsides, it’s great to see that businesses with annual wage bills below £3 million will have 90 per cent of their apprenticeship fees covered by the government, meaning they only have to find 10 per cent from the business.
‘Take into consideration that those aged 16-18 years old would also provide a £2,000 incentive, split between the business and the individual, and there are some real incentives here for businesses to look at beginning apprenticeship programmes, or extending the programmes that they already have in place,’ she adds.