The Government’s consultation on the proposed apprenticeship levy closed this week and it appears that industry is sceptical of the proposals, perceiving them as little more than a tax on business that will do little to raise the quality of apprenticeships and perhaps even have the opposite effect, with employers – keen to claim back the levy – devaluing the scheme by rebadging basic training as an apprenticeship.

Manufacturers’ organisation EEF, says members are already investing heavily in apprenticeships with three quarters of large and medium size companies and half of small companies planning to recruit in the next 12 months. It says that if the target is to create 600,000 starts per year towards the overall target of three million, 120,000 should be earmarked for engineering and manufacturing.

Employers fear the proposals will cause them to lose out financially as there is little evidence to suggest that one of the scheme’s main aims, “that employers offering apprenticeships will get back more than they put in,” will be met. On the assumption the levy is 0.5% of payroll, companies with over 250 employees would have to double the number of apprentices they recruit with one company saying to ensure they don’t lose out financially they would have to increase their intake from 16 to 112 a year.

Given the cost of a four year apprenticeship, companies only recruit and invest in apprenticeships when there is a clear business case for doing so and are unlikely to offer more than they need.

In its response EEF has made a number of sound recommendations for redesigning the scheme to address employers’ concerns. With the recent Lloyds Bank Building for Growth report revealing that a shortage of skilled workers such as plumbers, electricians, kitchen fitters, carpenters and bricklayers is thwarting efforts to beat the UK housing crisis, let’s hope the Government listens to the EEF’s suggestions and redesigns the scheme to ensure that it suits everyone’s needs - and fast.

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Yours,

Jan Hobbs