Why 92% of the apprenticeship levy is unspent

Research by the Open University has identified that just 8% of the £1.8 billion paid by companies into the apprenticeship levy during the first year of its operation has been used to fund training.

The other 92% is still sitting with the Inland Revenue and will stay with them unless claimed and used by you, the levy payer (If you have a payroll over £3m (roughly 110 employees) then you will be paying).    Little wonder that 40% of business leaders see the levy as little more than an additional tax and have “written off” their levy contribution.

But why give money away to the revenue when you can use it to invest in the future of your business?

There are now 200 different apprenticeship programmes to choose from covering most skill areas required in a business

So why haven’t you used all of YOUR levy yet?

ResourceBank has 8 years’ experience of working with apprenticeship employers, training providers, colleges and sector skills councils, and, over the last year, we have heard these reasons:

1. “We don’t hire apprentices”

You don’t need to. Forget the traditional image of an apprentice being a new young unqualified trainee learning a trade.  The levy can be used to fund the training of your existing staff.  Think about your management development, customer service, team leadership challenges – training and skills development in these areas can all be funded through the levy.

2. “My staff don’t like being an apprentice”

They don’t need to – and don’t even use the word “apprentice” when launching your training programme.  The levy is all about skill and people development – and can be used to develop at all levels of your business – even MBA or PhD!

3. “Apprenticeship training takes up too much time”

It’s understandable why some companies think they shouldn’t put staff on courses due to the disruption it can cause in the workplace, but this simply isn’t the case anymore. Training providers have become creative and more innovative in their delivery of training with the majority of apprenticeship courses being work-based programmes that are tailored to the business and provide much more flexibility. To minimise disruption, learners can take part in online tasks such as webinars and online coaching alongside having a tutor visiting them in the workplace.

4. “It’s too complicated to identify what apprenticeship training to use”

Yes it is a complicated system and there are more than 2,600 registered training providers to pick from with local, regional or skill sector specialities.  Fortunately there are services to help employers identify the best partners for them – and an independent apprenticeship consultancy is the most focused and responsive method to use.

At ResourceBank, we offer this consultancy service to help our clients identify the best way of utilising their apprenticeship levy.  We identify what their business, development and training needs are, which programmes they could use and recommend which registered training providers would be the best suited to deliver it.

We call the service Apprentice Link – and the best thing is that we don’t charge you a penny for it.  Our costs are covered by the training providers.

We are working with a wide range of employers to help them identify how to best support their apprentices. It is such an important investment, so impartial (and free) advice is essential to make the right decisions.

If you’re currently paying the levy (you need to have an annual payroll of just £3m – which is normally around 100 150+ staff), and not using it you are already wasting at least £15,000 – or think of it as £150 per staff member per year.

We’d love to help you use this, not lose this. 

If you want to find out more, let’s arrange a chat. We are always happy to advise

Contact Imogen Pearson on 01952 281935  to arrange your free consultation.

PS – If your payroll is under £3m, did you know that you can still use apprenticeships and the government will cover up to 90% of these costs.  Give us a call to find out more. Yes – our service is still free even if you don’t pay the levy!

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