According to figures obtained by the BBC, large employers are failing to spend hundreds of millions of apprenticeship levy
At least 55 of the largest employers in England have lost £1m or more in unspent levy. In the first 8 month period that levy has been able to expire, around 5,000 employers have contributed to over £400m in levy being lost to the government. This has resulted in suggestions that many employers are considering the apprenticeship levy as an extra tax.
Angela Rayner MP, Labour’s Shadow Education Secretary, said:
It is absurd that businesses are allowing hundreds of millions of pounds of Levy funds to expire when so many young people are unable to access a high-quality apprenticeship.
Vast sums of money going unspent are a sign of a system in need of fundamental reform to make it work for learners and small businesses.
In the upcoming Budget, the new Chancellor must fix this ineffective system, to give people the support they need.
The Department for Education says expired funds will be used to support other apprenticeship training by smaller employers.
A spokesperson said:
The levy means more money is available than ever before for training, and this year we have increased investment. We recognise that not all levy-paying employers want to use all of the funds available to them. Levy payers also have the option to transfer up to 25% of their levy funds to other employers.
While many employers are either struggling to spend their levy or treating it as an extra tax, science using employers seem to be bucking the trend.
Nick Durrington, Managing Director of Cogent Skills Apprenticeship and Graduate business unit said:
The science using industry across the UK currently spends twice the amount of available apprenticeship levy compared with some sectors. We are proud that Cogent Skills have been instrumental in supporting levy paying science industry employers to maximise apprenticeship opportunities through our recruitment, employment, consultancy and delivery services to build and grow early talent careers and allow the UK science sector to prosper.