How the new apprenticeship levy will benefit employers from April onwards

Guest blog by Kelly Ball, Managing Director of Positive Outcomes, a leading provider of apprenticeships and work-based training

The apprenticeship levy comes into force in April, and it promises to help businesses thrive by enabling them to establish a talented and skilled workforce.

One of the primary aims of the levy is to increase the number of apprenticeships nationwide. This is in line with the government’s pledge to create 3 million new apprenticeships by the year 2020, in a bid to broaden the depth of UK talent and skills.

 

Businesses need to understand the reforms

It’s important that businesses, both those required to pay into the levy and those that aren’t, understand exactly how the reforms will affect them.

The reforms require that businesses with an annual wage bill of over £3 million pay into the levy – at a rate of 0.5% of their wage bill – to help fund apprenticeships. They will receive an allowance of £15,000 to offset against the cost, helping to reduce their compulsory levy contributions.

Through co-investment with the Government, non-levy paying businesses will be required to contribute 10% percent of their training costs, with the Government covering the remaining 90%. And smaller companies – those firms with fewer than 50 employees on their payroll – will receive 100% of the funding from the government for the training costs of apprentices between the ages of 16-18 years old, or those aged 19 – 24 and have previously been in care or who have a Local Authority Education, Health and Care plan.

In an effort to help support getting young people into quality apprenticeships, companies will receive £1,000 from the government when they take on an apprentice between the ages of 16-18-years-old. There will also be grants available for businesses that take on apprentices between the ages of 19-24-years-old and have previously been in care or have a Local Authority Education, Health and Care plan. This will help ensure that all apprentices are afforded equal opportunities in the workplace.

 

New legislation incentives apprenticeships

The new legislation incentivises businesses to take on apprentices, allowing them to increase the range of skills within their workforce and establish a new talent pool that can address any internal skills shortage. By partnering with specialist training providers, such as Positive Outcomes, companies can create structured and well-planned apprenticeship programme that are tailored to their specific needs. Levy paying businesses are also able to use Levy funds to train existing staff to up-skill their current workforce, this will help support their employees and allow their businesses to grow and thrive.

The levy works to enhance the value of apprenticeships, not just by creating more opportunities and high-quality apprenticeships, but by highlighting the commitment from businesses to develop young and dynamic employees. A new set of apprenticeship standards, devised by the employer groups known as “trailblazers”, has been approved by the Department for Business, Innovation and Skills and will give employers greater autonomy when it comes to the development of their apprentices.

As an organisation, we have worked with apprentices for over 20 years and have found structured and well-planned apprenticeship programmes allow businesses to train apprentices and embed skills that fit specific requirements – which in turn, makes them invaluable to the future growth of the business.

 

More school leavers are turning to apprenticeships, helping companies create a richer talent pool

We have seen, over the past few years, a shift in the expectations of young people. Today, work culture, training and progression often play a key, and sometimes a deciding role, in whether a young person accepts a job offer. For some, the traditional route from school to university is eschewed in favour of an opportunity that will provide them with both work experience, training and qualifications. This is why more and more school leavers are turning to apprenticeships in an effort to break into the sectors that most interests them.

The levy has the potential to revolutionise the UK’s future workforce by creating better training opportunities, giving businesses greater control of apprenticeship programmes and helping companies create a richer pool of talent that will address any internal skills shortage.

For more information on apprenticeships and the work that Positive Outcomes does, please visit http://www.positiveoutcomes.org.uk/ or call 0800 488 0488 to find out more.

 

 

Author: Editorial Team

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