23-08-2019

We are now well into the ‘use it or lose it’ scenario with the apprenticeship levy, many employers have either not been able to use all of the levy or never used it for varying reasons.

In a recently published report by the CIPD entitled Addressing employer under-investment in training – the case for a broader training levy it was noted by CIPD that a “substantial long-term fall in the volume of, and level of investment in, work-based training in the UK.” had occurred since the introduction of the apprenticeship levy, so made a recommendation to urgently reform the apprenticeship levy. This would mean expanding the use to all work-place training and not just restrict it to those following various apprenticeship schemes.

There is no definitive reason as to why there has been a significant decline in work place training, but what is certain is the decline has happened.

What the CIPD found was:

  • “The levy has failed to increase the number of apprenticeships since its introduction, with current starts down 14% on pre-levy figures.
  • The levy is failing to boost overall investment in training. Less than a third (31%) of levy-paying organisations believe that the levy will increase the amount of training they offer, a fall of 14% since 2017.
  • Over a fifth (22%) of levy-paying organisations stated that they had used the funding on training that would have happened anyway, and 14% reported that it had directed funds away from other, more appropriate forms of training.”

The CIPD is not suggesting that the apprenticeship levy be scrapped indeed the opposite. It recognises that high quality apprenticeships are needed, but equally so is other high quality training. It has, therefore, called upon the Government to expand the apprenticeship levy into a more encompassing training levy allowing “…other forms of accredited training that are aligned to industrial strategy priorities.”

The sad possibility is the decline in workplace training will continue unless there is intervention that can be sustained. As CIPD set out “…address issues related to management failings and low-skill business models.”

Another idea offered by the CIPD is a ‘regional skills fund’ as they foresee the continual decline in investment and numbers of work place training be unstoppable, fearing that a reversal in fortunes is unlikely under the current regime. Their suggestion to fund this ‘regional skills fund’ is to introduce “top-slicing levy contributions from the largest employers to address local skills and demand-side challenges.” The perceived outcome of this would be an increase in “workforce productivity alongside an overall increase in the demand for, and use of, skills in England’s regions.”

Other regions of the UK may have differing views regarding the levels and provision of workplace training.


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Andi Herrington
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