We often get asked what is the apprenticeship levy? In April 2017, the government introduced the Apprenticeship Levy with a view to funding three million new apprenticeships by 2020.
The Apprenticeship Levy Explained by Stockport’s Damar Training
Every month employers with an annual wage bill of more than £3m contribute 0.5% of their pay bill into a fund that can be reinvested in apprenticeship training for their business. But are businesses making the most of their investment?
How does the apprenticeship levy work?
Monies raised from the apprenticeship levy are paid into the company’s dedicated digital account with a further 10% top up from government. But apprenticeship levy funds expire after 24 months and unspent funds are absorbed by the UK Government at a rate of nearly £120 million a month. While the Department for Education will use the absorbed funding to invest in skills and training, two in five (38%) of employers have written off their contributions to the apprenticeship levy and missed an opportunity to use it to fill their own skills gaps and future-proof their businesses.
Further information on this and how to set up your account can be found here.
How can I spend my apprenticeship levy funds?
The apprenticeship levy provides employers a unique opportunity to transform their learning and development strategy. It can fund apprenticeship training for newly recruited apprentices or develop the skills of an existing workforce.
How are companies making use of their apprenticeship levy?
Currently, 62% of employers have embraced the scheme and are reaping the rewards. Of those currently working with apprentices, more than a quarter (27%) say it has been good for their organisations, while one in five (20%) report that it has already delivered significant benefits. With over 400 apprenticeship standards to choose from whether you are looking for your next Administrator or thinking about how you can develop the management skills within your workforce, there are many development opportunities to suit a variety of roles within every business.
How can the apprenticeship levy can close the skills gap?
Currently, two-thirds of organisations are lacking management skills, while half are in need of digital skills – both crucial in the face of the current political, economic and technological environment. Those who are using apprenticeship levy funding are starting to plug these gaps across all levels of their organisation.
A quarter (25%) of those not currently using levy funding admit that they are missing out on an opportunity to develop the skills they need.
Can I gift my apprenticeship levy to another organisation?
Gifting or transferring the apprenticeship levy can benefit smaller companies and charities. Employers can gift up to 25% of unspent levy funds from their account to non-levy paying companies for them to use to recruit apprentices or develop the skills of their existing workforce.
Who can I ask for advice about the Apprenticeship Levy?
We work with large businesses, including large public sector organisations, to develop and deliver their learning and development needs. Whether you are looking to attract new people to your business or develop your existing workforce, we provide advise and help employers create a strategy that maximises levy spend.