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Apprenticeship levy is not working, employers say

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The government’s new apprenticeship levy is yet to increase the number of people being trained, according to official figures released on Thursday.

There were 114,000 apprenticeship starts reported so far for the first quarter of the 2017-18 academic year.

That compared with 155,600 for the same period in the previous academic year.

The EEF, the manufacturers’ organisation, said ministers had failed to act on the industry’s growing concerns about changes to the system.

The apprenticeship levy and Apprenticeship Service were introduced in May 2017, which the Department for Education said was likely to have affected the number of apprenticeship starts and participation.

“It is clear the apprenticeship levy and wider reforms aren’t working and need a radical rethink,” said the EEF’s Verity Davidge.

“Government must listen to business concerns and ensure the levy delivers the demand-led system that was promised to employers.”

  • CBI says firms ‘alienated’ by skills levy
  • Apprenticeships: ‘It’s the money that puts people off’

The 26% quarter-on-quarter fall was not as big as the 59% slide between the fourth quarter of 2015/16 and the same period in the 2016/17 academic year.

The figures are subject to change until final data is published in November.

Analysis: Jonty Bloom, business correspondent

The apprenticeship levy looked fine in principle. Its implementation has been met with howls of protest from industry and declining numbers of people starting courses.

The levy is a tax on large companies intended to pay for training at smaller companies. Large firms hate it, claiming it is no more than an added tax and are finding ways of claiming the money back to spend on other training courses.

Small firms find the system complicated and say the government has failed to provide anything like enough approved courses for them to use.

Ministers say these are teething problems. But at a time when the government is desperately trying to improve skills and productivity by increasing the number of apprentices, the opposite is happening.

It seems increasingly unlikely that the government can hit its target of 3 million new apprenticeships by 2020.

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