Concerns raised over new apprenticeship levy

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Government plans for a new apprenticeship levy could have a significant impact on the Construction Industry Training Board…

The BSRIA has raised concerns about the introduction of a new apprenticeship levy, warning it could spark the end of the Construction Industry Training Board (CITB).

Building consultancy firm BSRIA said construction firms have been left in the dark as to how the new levy will work with the existing construction-only levy. It queried whether members will be expected to pay the statutory industry levy to CITB, as well as the new levy, and warned this could “kill-off” the CITB.

In a bid to gain an understanding as to how the sector feels about the new levy, a consultation has been launched asking employers for their views. The document states the apprenticeship levy will be economy-wide and will impact most notably employers in the construction and engineering industry. The BSRIA said with this in mind government and the sector should decide how existing levy arrangements may impact the new apprenticeship levy.

The BSRIA recommended two options for how the new levy could be implemented. The first is for construction employers to pay the new apprenticeship levy while continuing to pay the existing industry levy. In this instance the CITB would expect firms to fund apprenticeships via the apprenticeship levy.

The second would see the statutory industry levy arrangement removed, meaning employers only pay the apprenticeship levy. This would be a significant change to how training works in the sector. The BSRIA said it would be necessary to understand what impact this would have on the skills and capabilities of the UK construction industry.

Chief Executive Julia Evans commented, stating: “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 the impact of the levy on the SME (small and medium enterprises) where most apprenticeships are situated.

“Given that 99.9 per cent 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.

“These are worrying times for the outlook of our industry’s workforce.”

The levy, which will impact all industries, is expected to come into force from April 2017.

The consultation can be found here. It will look at a range of questions, including how the levy can give back to employers and how to give employers more control of apprenticeships.

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