95% of manufacturers are demanding changes to the Apprenticeship Levy, according to research conducted by EEF.
Although there may be disagreements about the degree of change require, the overwhelming majority of businesses clearly want to see something different from the levy.
The group of firms, which includes food and drink manufacturers, are now calling for the government to take part in an urgent summit. There is a clear need to discuss reforms that will make the levy work for everyone, as well as helping to ensure that more new apprenticeships will be created in the future. High-value manufacturing and engineering apprenticeships are particularly in demand, as food engineering jobs tend to be much coveted for jobseekers.
According to the survey, 52% of manufacturers are keen to keep the levy so long as changes are made to the current system to make it work better for everyone. 26% were in favour of having the levy turned into a training levy instead.
8% of those surveyed stated that they have either cancelled or delayed an apprenticeship for a new engineering recruit due to the levy. 11% of those who wanted to start an apprenticeship for an existing employee have done the same. This is clearly having an impact on the number of training positions available, which could be highly damaging for industry in the UK as a whole.
Verity Davidge is the head of education and skills policy with EEF. She claimed that both apprentices and employers have lost out thanks to the existing system.
“What should have been a win-win situation has turned into a lose-lose,” she said. “We have to address the alarming drop in starts initially and then look at positive solutions which are on the table to make the levy work for employers and learners in the long term. Government must now sit down with businesses and find a way to rescue the levy so that it meets the original pledges made to companies when it was introduced.”
The EEF has now set out a proposed list of changes that would be needed to make it work. These include increasing the deadline for employers to spend their levy funds to at least 48 months, if not more; they also want to change the levy’s budgeting solution based on the fact that employers have high demands for better-quality apprenticeships. Expanding the bonuses and incentives paid out as well as raising the budget cap for each levy would also be something that many businesses want. The signing off process was another area highlighted for change, as business owners feel that it is currently too slow and not transparent enough.
Justine Fosh serves as the Chief Executive Officer at the National Skills Academy for Food & Drink, a place familiar to many who are seeking food jobs. She was not surprised at the fact that so many improvements have been suggested after seeing the results of the survey.
““There are certainly some aspects that frustrate employers and that Government could address,” she said. “But it is our experience that there is a limit to what Government can do to make a system entirely responsive to an industry. Successful sectors will be those who come together and use the levy and other Government skills initiatives as an opportunity to address long-standing skills challenges. This is just what the food and drink manufacturing industry is doing.”
There has not yet been any official response that would suggest whether or not the government is considering making the changes that have been proposed by the EEF.