小黄鸭app

It鈥檚 been one year since the introduction of the Apprenticeship Levy on 6^th April 2017. What is the Levy, how have the past twelve months gone and are employers any clearer on how to utilise it?

What is the Apprenticeship Levy and who has to pay?

It鈥檚 a UK Government employment tax that is collected from all employers (public, private and third sector) with a pay bill of over 拢3 million a year from companies in England, Wales, Scotland and Northern Ireland. The Levy rate is 0.5% of the company鈥檚 pay bill, but they receive an allowance of 拢15,000 per year to offset this cost.

In England

You may be aware that Levy-paying companies in England receive vouchers to spend on staff training and are given access to a digital account to find training providers, choose Apprenticeship programmes, find candidates and pay for Apprentice training.

This is however, not the case for levy-paying businesses in Wales, Scotland and Northern Ireland.

Devolved differences

The differences between the English system and the other regional systems has been a cause of confusion for many levy-paying Welsh, Scottish and Northern Irish businesses.

With the devolved nations being in charge of their own skills policy, Wales, Scotland and Northern Ireland received a population-based share of the levy pot to be invested as their respective governments saw fit.

UK-wide businesses

Contributions into the levy pot are based on all UK employees, but you can only spend the electronic vouchers on employees living in England. For Apprentices outside England, you have to navigate each regional system.

In Wales

The Welsh system delivers its Apprenticeships through the training provider network (this is where 小黄鸭app come in) where Apprenticeships are fully-funded for eligible learners, regardless if businesses are paying into the Levy or not.

For the first year of the Levy, Wales received 拢128 million from the UK Government. However, this isn鈥檛 extra money as the funds were offset by the retraction of 拢90 million due to Wales under the old, pre-levy system. On the other hand, the Welsh Government has stated that it increased investment in Apprenticeships from 拢96 million to 拢111.5 million from April 2017.

Essentially, for Welsh businesses looking for funded training, not much has changed, even if your business is paying into the Levy. You still access funding for work-based learning through the country鈥檚 training providers like 小黄鸭app Training.

One year on

Ministers hope the levy will raise 拢3 billion annually by 2020 and lead to 3 million Apprenticeship starts by 2020. But how realistic is this based on the current uptake?

The that in the one year since the Apprenticeship Levy鈥檚 introduction, a huge 拢1.28 billion of the 拢1.39 billion paid into the Levy pot by UK employers is still sitting there unused. That鈥檚 a lot of available funds that employers aren鈥檛 seeing the benefit from.

There have been complaints about the complexity of the system, particularly in England, which was acknowledged by Chancellor Philip Hammond in his Spring statement, saying that 拢80m would be granted to small and medium-sized enterprises (SMEs) to help them navigate the system.

However, with the two year 鈥榰se it or lose it鈥� clause on the Levy pot, employers could be returning over 拢1 billion to HMRC if Levy spending doesn鈥檛 increase. This is money going down the drain for work-based learning, funds that could be used to upskill workforces and employ Apprentices.

It has been labelled by some, including a , as a UK government imposed employment tax that 鈥渃ompletely overlooks and undermines our [Wales鈥橾 very distinctive approach to supporting Apprenticeships鈥�.

He continued: 鈥淚ts introduction has come at a considerable cost to Wales and any Barnett consequentials we have received from the Levy have been largely offset by cuts made elsewhere, meaning there is no significant new money coming to Wales.鈥�

What next?

There is still a year left for businesses to draw funds from the levy pot, but with it taking a few months for a business to set up an Apprenticeship programme, how many Apprentices will be signed up and how much of the levy pot will end up staying put and being reabsorbed by HMRC?

Regardless of where you stand on the Levy, in Wales it is very much 鈥榖usiness as usual鈥� and we are here to support you. If you鈥檙e looking to upskill your workforce with Apprenticeships or take on an Apprentice in Wales, contact us on info@acttraining.org.uk or 029 2046 4727 to find more.