We all agree the right talent is key to business success. And elevating the skills and knowledge of workers locally is something all businesses can benefit from. So if we all benefit, let’s make sure we’re not losing any resources back to central government. Did you know the Government’s apprenticeship levy can be paid by one company and used by another? So if you’re a levy-paying company with unspent levy funds, don’t let it go to waste – gift it to your local business economy. And if you’re a non-levy paying company, reach out to see if there’s unspent levy to be had. All companies with a UK pay bill of £3m plus have to pay the apprenticeship levy. From April this year levy payers can gift up to 25% of this to a non-levy paying company to spend on apprenticeships.
This is part of the Government’s drive to get apprentices in place and see the right skills embedded into the workforce. Research from the Open University suggests UK businesses are at risk of losing £3 billion in the levy fund. Instead of going to increase skills and boost local productivity, it’ll be absorbed back into Government coffers. No one wants to see that potential lost – and it’s going to feel like a secret tax if we don’t all take a couple of easy steps to stop this being clawed back. Mostly it seems that levy-paying companies simply can’t find the time to develop an apprenticeship strategy, with many being put off by the process for accessing funding. Yet there are organisations out there that can help.
Local colleges and training providers should take on much of the paperwork and process management. Local partnerships also offer support – for example the Marches Skills Provider Network should be able to help broker arrangements between levy and non-levy paying companies so that Shropshire doesn’t let the funding wither on the vine. And boutique companies like mine, with years of developing and managing apprenticeship programmes, are also on hand to offer advice and ideas. From April 2019, the Government started to drawback unused levy funds at a rate of nearly £120 million per month. While the Department for Education will reinvest this funding into skills and training, this is an opportunity for companies to use it to fill their own skills gaps or gift it to another non-levying paying company or charity.
There’s plenty of success stories from companies that take on apprentices who are starting to plug common skills gaps – like digital skills and management training. They report seeing significant benefits and now this is achievable for more SMEs through this levy gift option. If your company is a levy payer and you want help to develop your apprenticeship or talent management strategy, or you want more information on the transfer between levy payers and non-levy payers, get in touch.