Employers rebrand training as apprenticeships to access levy fund
Almost half (46%) of employers plan to repackage their existing training schemes as new apprenticeships in order to access their £15,000 training fund provided by the apprenticeship levy.
A survey of more than 1,000 employers by the CIPD found that more than half (53%) of employers that pay the apprenticeship levy would prefer a more flexible training levy that is more suitable for their training requirements.
More than half of the group that plan to rebadge their existing training schemes expect to create level 2 apprenticeships, equivalent to five GCSEs, to ensure they are able to use the apprenticeship fund, rather than creating an apprenticeship from scratch.
The CIPD’s ‘Assessing the early impact of the apprenticeship levy’ report also suggested that a fifth (19%) of employers subject to the levy do not expect to use their apprenticeship allowance at all, and will simply write off the levy as a tax.
The report recommended the Government to run a campaign to promote the levy among SMEs and commission a review into whether apprenticeships are providing quality education.
The CIPD’s survey also found that 22% of employers do not know whether they are paying the levy, which applies to employers with an annual payroll of more than £3m and is charged at 0.5% of their employees’ total salary.
The research echoes similar findings last summer by the CBI and Pearson which found that 63% of employers planned to reconfigure existing training into apprenticeships and 27% expected to cut back on non-apprenticeship training activity to meet levy costs.
To find out how you can REALLY add value by using apprenticeships in your business, contact Tess here to speak to the experts in employee training.