Employers have cautiously welcomed the chancellor’s announcement that the value of apprenticeship levy vouchers that can be transferred will increase under new plans.
UK chancellor Philip Hammond confirmed earlier this week that employers will be allowed to transfer up to 25% of their apprenticeship levy entitlement to another organisation in their supply chain, from April 2019.
More money will also be pumped into the Institute for Apprenticeships and apprenticeships in science, technology, engineering and maths subjects.
The measures are a bid to meet the government’s target of three million apprenticeship starts by April 2020. Recent figures suggest starts are still well below previous years.
Commenting on the measures, Brian Berry, chief executive of the the Federation of Master Builders, said: “The chancellor has, in part, listened to the concerns of business by making the apprenticeship levy more flexible. However, he needs to go much further. Currently, 10% of levy vouchers can be passed down through the supply chain from large firms to smaller firms and today, he increased this to 25%.”
“This is important as in construction, it’s the small firms that do the bulk of the training while the large firms don’t tend to directly employ or train tradespeople. Since the apprenticeship levy was introduced last year, apprenticeship starts have fallen in the construction trades by more than 10%. Given that the construction industry is already suffering from an acute skills shortage, this is very worrying indeed.”
“If the chancellor is serious about ensuring the levy has the desired effect, and increases meaningful training across all sectors, it should go further and make 100% of the vouchers transferable from large to small companies.”