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Government introduces apprenticeship levy

The introduction of an apprenticeship levy has left the industry questioning the future of the current levy to the Construction Industry Training Board (CITB).

Construction firms have been left in the dark as to how the government’s new levy will interact with the existing construction-only levy.

A consultation has been launched asking employers for their views on the plans.

The consultation document states that the apprenticeship levy will be economy wide and larger employers in the construction and engineering industries will be in scope of the levy alongside all other larger employers in the UK.

On that basis, government and the industries need to decide how best the existing levy arrangements respond to the apprenticeship levy.

BSRIA chief executive Julia Evans said: “Quality apprenticeships are essential for our industry to help strengthen the economy, deliver the skills that employers need and give millions more hardworking people financial security and a brighter future.

“Skilled people are the lifeblood of a strong economy to meet the demands of a competitive, global market. We hope that our members don’t have to pay such levies twice over and that the future of the CITB is safe – especially as the training it provides is dedicated to the construction industry.”

Another concern is around the effect of the levy on small and mediumsized enterprises (SMEs) where most apprenticeships are situated, Ms Evans said: “Given that 99.9% of construction companies are SMEs, the future and livelihood of their apprentices could be under threat – if larger companies resent contributing towards this new levy, smaller businesses will inevitably feel the impact.”

This move forms part of the government’s pledge to support 3 million apprenticeships by 2020, include a requirement to take a company’s apprenticeship offer into account when awarding large government contracts and publishing new industry standards so apprentices have the skills that firms need.

The all-industry levy is expected to come into force from April 2017.

The Apprenticeship Levy consultation seeks views on:

  • paying the levy;
  • how the levy should work for employers who operate across the whole of the UK;
  • how to make sure that employers paying the levy have the opportunity to get more out than they put in; and
  • how best to give employers control of apprenticeships.

The consultation closes on 2 October.

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