Whether you’re paying the apprenticeship levy or not, apprenticeships are a great option for businesses. Apprenticeships:
- Increase productivity
- Bring fresh ideas to your business.
- Help develop new skills.
- Increase staff engagement.
- Improve staff retention rates.
- Upskill existing staff (Apprenticeships are for any existing or new employee aged 16 to 65!)
However, despite the above business and personal benefits, it’s no secret that employers aren’t spending their levy.
Businesses with a wage bill over £3 million have been paying the apprenticeship levy since April 2017. But although they’re handing over hard-earned cash, employers don’t seem in a rush to make the most of their levy funds. In fact, only 13.7% of the levy has been spent on training – leaving £2.3 billion in the pot. All unspent funds left in employers’ levy accounts are wiped after 24 months, meaning most employers are slowly starting to lose money from their NAS accounts every month.
The apprenticeship levy was a brand-new policy when it was brought in, so this slow start was to be expected. Employers had to get their head around the levy, figure out an apprenticeship strategy, and start the process of training apprentices within their business. It was a huge undertaking, and apprenticeship starts fell by 199,100 in one year – from 495,000 starts in 2016/17 academic year to 376,000 in 2017/18. This decline was attributed to the change in funding system, so the Government made a few policy updates to make the system more flexible to include:
- The amount of time given to employers to spend their funds was extended from 18 months to 24.
- The levy reallocation limit was increased from 10% to 25%.
This increase in levy allocation marked a big change of heart from the Government. When the levy was first introduced, levy funds couldn’t be transferred between employers. They then relaxed the rules so employers could transfer 10% of their funds, and this has been upped again to 25%. It’s far from the 100% transfers many employers wanted, but it’s a step in the right direction.
Levy-payers who don’t spend or transfer their funds within 24 months will have the expired funds removed from their NAS accounts. These expired funds are then allocated to SMEs – so either way, the levy is being spent on apprenticeship training.
How Technique Learning Solutions can help
Technique Learning Solutions want to help employers maximise and unlock the potential benefits of apprenticeship delivery. Our specialist team will assist your organisation through the whole process from enrolment and administration to delivery, monitoring and successful completion of apprenticeship qualifications.
At Technique we off a range of Engineering and Generic apprenticeships to Levy paying companies.
We pride ourselves on our ability to make the apprenticeships flexible and tailored to meet the specific needs of individual employers. Unlike colleges and many other academic establishments, we are not restricted by yearly timetables allowing Technique to enrol and deliver year-round tuition that best suits business needs.