Neil Carberry, CBI Director for People and Skills policy

Business remains concerned about Levy, but committed to making it work

With companies paying £3 billion a year in the Apprenticeship Levy from today (6 April), the CBI has cautioned that significant concerns still exist about whether the policy will deliver the high-quality training businesses and apprentices need.

With the Government working quickly to get the Apprenticeship Levy in place for launch today, its focus so far has been on building an operational system that works. Now the policy has been introduced, the CBI is repeating its call for the Government to broaden its focus, prioritising quality and long-term success measures alongside growing apprentice numbers.

Neil Carberry, CBI Director for People and Skills policy, said:

“Given the speed and scale of the introduction of the Apprenticeship Levy, businesses have been working hard to get ready against a tight timescale.

“Now that the system for paying and reclaiming the Levy has gone live, the time has come to focus on quality training that meets company and apprentice needs.

“For the Levy to be a success, it must deliver long-lasting careers and close skills gaps, not just create more apprenticeships.  Shifting the focus onto quality is essential to delivering much needed stability to England’s skills system, that’s why business is focused on helping the Institute for Apprenticeships get this right.

“As it stands, there is a genuine risk that firms aren’t going to be able to use their funds if the system does not deliver the training apprentices need.”

Business concerns include:

  • A lack of fully-developed success measures and long-term goals focused on apprentice progression and closing skills gaps. Concerns remain about the level of commercial acumen available to shape the successful design of the system
  • Some firms face paying for the Levy but being are unable to access new or updated training standards, or have no approved providers available locally
  • Slow progress in approving new apprenticeship standards for companies to use
  • A lack of accessible information for employers about the Government’s list of approved providers and their quality of training
  • Ineffective careers guidance in schools about available apprenticeship options
  • A narrow definition of what employers can spend their Levy vouchers on for off-the-job training.

As part of its extensive, ongoing engagement with companies to prepare for the Apprenticeship Levy, the CBI has identified a number of recommendations for the Government, which would help employers access quality training with confidence.

Recommendations include:

  • The Institute for Apprenticeships (IfA) should set long-term measures of success, agreed in partnership with businesses
  • Providing more commercially-focussed resource and support to the IfA, to help understand what quality training looks like for business and why they chose to invest
  • The IfA should work with businesses to help improve market regulation of college and private providers and challenge poor quality provision
  • Focus must be given to increasing the pace of approval of new apprenticeship standards across all industries
  • The Government should give employers longer than 24 months to spend their levy vouchers, if current issues remain unresolved in the first year
  • Over the longer-term, the Government should consider a more flexible skills levy, to not only support apprentices but also retraining for adults.

About CBI: Across the UK, the CBI speaks on behalf of 190,000 businesses of all sizes and sectors. The CBI’s corporate members together employ nearly 7 million people, about one third of private sector-employees. With offices in the UK as well as representation in Brussels, Washington, Beijing and Delhi, the CBI communicates the British business voice around the world.

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