Manufacturers urged to make Apprenticeship Levy work

Published:  03 March, 2017

Semta is urging all businesses in the advanced manufacturing and engineering sector in all parts of England, not to miss out on the opportunities afforded by the new apprenticeship levy.

Annette Collins, head of Semta Apprenticeship Service says that businesses need to make the most of the fundamental changes to skills funding arriving this Spring: “This is a momentous moment in skills provision ­ one not to be taken lightly.

“We have skills shortages across the advanced manufacturing and engineering sector, and the levy offers an opportunity to employers across the sector to spend a potentially quite substantial sum of money on meeting their skills needs.

“It’s really important to remember that employers will be able to be creative and flexible in how they spend their levy funds to benefit their business. They will be able to use them to up-skill and re-skill existing workers, as well as to recruit new talent.”

On its introduction on 6th April 2017, the levy will be set at a rate of 0.5% of an employer’s annual payroll ­ a £15,000 allowance from government will mean that only employers with annual payrolls of over £3m will ultimately pay any levy. This means that a majority of employers will not pay the levy and will not pay for their apprenticeships with the new digital voucher scheme. Instead, 90% of the cost of their apprenticeships will be covered by government, with further top-ups being offered too so that some non-levy funded apprenticeships will continue to enjoy full government funding.

From Spring 2018, levy-paying employers will be able to transfer up to 10% of their apprenticeship vouchers to SMEs and their supply chains ­ offering the prospect of millions of pounds worth of additional funding cascading down through the advanced manufacturing and engineering sector.

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