Iain Wright MP, Chairman of Business, Skills and Innovation (BIS) Select Committee, has voiced his concerns over the apprenticeship levy’s “lack of clarity.”
Speaking at the sixth annual TSS Skills Summit yesterday (Thursday,18th February) in London, Wright participated in a panel discussion on how to nurture the high-level skills required to strengthen the UK’s productivity.
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“We (BIS) welcome that the government has put apprenticeships and the 3 million target at the centre piece of their skills policy. We want the government to achieve the target, but there has been a degree of tension and contradiction. The government want apprenticeships, skills and policy to be employer led, and yet they have set a three million target without any clear distinction of what is required.”
As part of the Government proposals, a new levy will come into effect next April 2017. Large business with more than 250 employees will have to pay 0.5 per cent of their total wage bill to encourage companies to offer quality training to young people. It is estimated that the bill will raise £3bn a year.
In an exclusive interview with TJ, Skills Minister Nick Boles said that he was confident that the levy would approve the standard of apprenticeship.
When asked about ways to measure the return on investment, Boles explained how the government planned to assess the new standards: “There is defensive quality control and an overall measurement of impact.”
However, Wright said there was a “fog of uncertainty.”
“How are we going to get to the three million target, it seems the government have announced the destination, but the pathway to actually getting there hasn’t been built yet.
“We have no real detail of how the levy will be implemented, which doesn’t give businesses or colleges any time to prepare and plan courses in terms of student guidance and information.
“One of the structural weaknesses in our economy is that small businesses do not train and hire apprentice because they may not have ability or resources to do. If we are going to help small businesses to ensure they can train the next generation of their workforce how is the levy going to help? Given that only 2 per cent of larger firms are only going to pay the levy, so what’s going to happen to the remaining 98 per cent?”