IGA explain Apprenticeship Levy Consultation

The Department for Business, Innovation & Skills (BIS) publish a consultation on their proposal to introduce an apprenticeship levy

IGA explain Apprenticeship Levy Consultation

The Independent Garage Association (IGA) explain that BIS want to put employers at the heart of designing apprenticeships, and give employers control of the funding. If the levy goes ahead, larger employers will have to contribute funding to apprenticeship training from 2017, tackling skill shortages and creating higher quality apprentices.

The Government wants to ensure that paying the levy is as straightforward as possible and therefore intends for the levy to be calculated on the basis of employee earnings, with employers to pay the levy through their PAYE return to HMRC.

The levy will apply to employers in all sectors, but will only apply to larger employers. The Government intends that the size of employers will be calculated in relation to the total number of employees.

Over 200,000 workplaces currently hire apprentices, the vast majority of which are small businesses. Because larger employers shouldn’t be the only ones who are in control of their apprenticeships, the Government are proposing that employers of all sizes in England will use the same digital voucher system to pay for the apprenticeship training they want.

A single system for all employer types also means that as an employer grows their use of the system will grow with them, rather than having to grapple with a different way of doing things just because they have changed size.

In the autumn, BIS will set out more detail about how employers who are outside of the scope of the levy can access apprenticeships funding.

The RMI will be sending back a response to the proposal. Members wishing to add their views are advised to contact through the member helpline.

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