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BESA backs improved SME access to Apprenticeship Levy funds

Organisation rejects calls to scrap levy system intended to create three million placements up to 2020; argues for better access to funds for SMEs in construction supply chain

The claims have been made in response to concerns about a 25 per cent drop in the number of apprenticeships that have commenced this year and the impact on these figures of the levy, which was introduced by the government with the aim of funding three million new roles by 2020.

BESA claimed that it still saw the levy, which was implemented last year to ensure funding was in place to support apprenticeships, as being on the “right track”. This is despite organisations such as the Confederation of British Industry (CBI) calling for the programme to be scrapped entirely.

BESA has rejected calls to end the levy, which intends to raise £3bn annually through businesses that earn in excess of £3m a year, arguing instead for amendments to the existing system to ensure more employers across the supply chain can gain access to the scheme.

The industry body added that a number of SMEs working in the sector have expressed concern over difficulties to gain access to the levy funding with the training offered from around 2,500 recognised providers not being sufficient for their needs.

Association president Tim Hopkinson said that recent figures on apprenticeship numbers were disappointing and reflected a need to amend approaches currently being used via the levy to upskill individuals working in specialist industries such as heating and cooling.

“It is not just the levy itself that is at fault. Employers are finding the changes challenging and too many training providers still deliver courses that are simply not relevant to the modern workplace.”

“SMEs, in particular, are just starting to get their heads around how the funding from the levy works – and the impact of larger employers passing on a share of their funds to supply chain partners has not kicked in yet. That could be a game-changer,” he added.

BESA added that figures from the Department for Education (DfE) indicated that there had been a drop in new apprenticeships to 194,100 for the first half of the academic year. The department has called for the scheduled release of full year figures in November before judging whether the levy has been implemented successfully.

Mr Hopkinson argued for more direct intervention from the DfE to ensure a more effective approach to introducing a larger number of apprenticeships across the industry.

“We have seen some very positive work by employers, but there also needs to be much more support for training designed by employers for employers.”

“This is the model for the New Standard apprenticeships, which are just getting up and running and must be backed up by more fleet-footed course providers willing to offer practical and targeted training.”

Tony Howard, BESA’s director of training, has argued that the number of apprentices taking up placements as a result of the levy systems was “still too low”, which he claimed was the result of a lack of funding for SMEs.

“Currently, employers are restricted to a relatively small number of large organisations able to provide non levy-funded apprentice training on programmes that employers evidently don’t want – and many of those do not cater for specialised industries like building engineering services,” he said.

“Employers are frustrated by this, but we are still dealing with a record number of enquiries from companies of all sizes wanting apprentices. We have also seen a 27 per cent increase in new apprentices signing up to our New Standard courses,”

Mr Howard said that the current levy situation was expected to improve over time as industry begins to understand the programme better.

He added, “Numbers are still too low, but that’s because of the lack of funding for SMEs.”

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