Employers unprepared for apprenticeship changes

Fri, March 17th, 2017

Chambers urges businesses to get ready

Liverpool & Sefton Chamber of Commerce is urging businesses across the city region to “get ready” for an imminent change to the UK’s apprenticeship system.

The issue was brought into sharp focus on Friday [10 March] morning when Liverpool accountancy and business advisory firm BWMacfarlane held a breakfast briefing for local businesses - and it was clear many remain in the dark about impending changes.

An apprentice can prove an invaluable asset to any business and the system for recruiting and training apprentices will undergo a radical shake-up in a matter of weeks.

In April, the Government will introduce the Apprenticeship Levy which will require all UK businesses with an annual payroll of £3m or more to pay a 0.5% levy on their bill to help fund the UK apprenticeship system.

The levy is part of a wider reform programme in further education that is the result of Ministers determination to raise standards in vocational training. This week’s Budget featured Chancellor Philip Hammond introducing the new ‘T-Level’ qualifications, which aim to position vocational technical training at the same level as higher education.

Now the chamber, one of the city region’s biggest suppliers of apprentices to businesses, is urging local firms to be aware of how the new set-up will affect them.

Major shake-up

Paul Cherpeau, the chamber’s director of learning and skills, has stressed that more than 98% of companies will not have to pay the levy, although the way apprenticeships are funded will be changing for all businesses with the majority required to contribute cash to recruit and train them.

He added that employers can still take on fully-funded apprentices under the current funding system until April 30.
“If you are a business looking to take on an apprentice – or train an existing employee on an apprenticeship qualification - before April 30 we can provide a fully funded programme but you would need to contact us as soon as possible,” said Paul.

Allowance for all

Under the new system large levy-paying employers will be able to use their levy to ‘shop’ for apprenticeship qualifications via the new web-based Apprenticeship Service. These employers will be able to get out more than they pay into the levy – via an automatic 10% top-up to their account from the government.

Levy funds will expire 24 months after they have been credited to employers DAS account.

Those with pay bill of less than £3m will be expected to make a 10% contribution towards the cost of training and the Government will pay the rest.

Extra cash

The Government will pay £1,000 to employers if they train a 16-18 year old apprentice or a 19-24 year old leaving care or who have a Local Authority Education and Healthcare plan.

Huge benefits

Paul added: “We currently have hundreds of learners placed with businesses across the Liverpool city region, who profess enormous benefits in employing an apprentice.

Vicki Harper, director of client services at BWMacfarlane gave testimony to this, saying: “We certainly realise the advantages of being able to nurture and mould young people in order to develop specific skillsets that suit our changing requirements.”

BWMacfarlane currently employ two apprentices, 17 year old Amy Ward and 20 year old Jason Murphy.

Jason, who is studying level three business administration and level two IT, said: “My placement with BWMacfarlane has enabled me earn whilst developing transferable skills.

“I’ve recommended apprenticeships as an option to lots of my friends. I think it’s a great way to explore and expand your options for career progression.

“It has opened my eyes to other opportunities too. When I came here, I had pretty much decided that I wanted to follow a career in accountancy, but in being able to work across different areas of the business, I am now considering marketing as an option.

“I’ve really enjoyed the breadth of learning my placement with BWMacfarlane has provided and am grateful for the opportunity to develop my experience in the workplace.”

Liverpool Chamber Training specialises in the delivery of qualifications in business administration, management, customer service and marketing. Their success rate of 69% for apprentices completing their training is above the national average of 67%.

For more information on the Apprenticeship Levy, or on the benefits of an apprentice, contact Paul Cherpeau at the chamber on 0151 227 1234.

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