January 4, 2016
The Government recently announced a new apprenticeship levy in support of its ambitious pledge to increase the quality and quantity of apprenticeships in England by three million by 2020.
From April 2017, businesses with a wage bill above £3 million will be required to pay an apprenticeship levy of 0.5 per cent of the company payroll. It is expected that £11.6 billion will be raised over this parliament to put back into training apprentices.
What will this mean for North East businesses? Whichever way you look at it, the levy is essentially a new payroll tax which, in times of increasing business rates and the introduction of the living wage, will put extra pressure on our region’s employers. And while the allowance means that 98 per cent of businesses are exempt, the remaining two per cent employ nearly two thirds of the private sector UK workforce.
That said, employers who embrace the levy can see it as an investment in their businesses. The levy will support all post-16 apprenticeships in England and provide North East businesses with funding. All employers, regardless of whether they pay the levy or not, will be able to access government funding for apprenticeships – so it’s good news for micro and small business owners.
Apprenticeships are a great way to grow your workforce and harness talent to ensure the future success of your organisation. It’s an opportunity to bring in up-to-date skills, and to nurture and up-skill new and existing employees to improve performance and productivity.
The funding will be controlled by employers through a digital apprenticeship voucher, and firms that are committed to training will get more back than they put in.
This puts the employer firmly in control of the quality of apprenticeship provision and Gateshead College is committed to helping businesses get the most out of what they invest. We work closely with businesses to understand what skills and knowledge their employees need to hit the ground running and then provide the training courses to match.
Gateshead College delivers more than 2000 apprenticeships each year to many employers across a wide range of sectors, including advanced manufacturing, construction, engineering, hospitality, logistics, automotive and hair and beauty – as well as new and emerging technologies. The training we are giving young people provides them with an employment edge and businesses with a competitive edge.
We have been heavily involved with trailblazer apprenticeships, where groups of employers join forces with training providers to design new apprenticeship standards for jobs in their sector. We are at the forefront of smart metering trailblazers, working with employers across the energy sector, and have played a key role in designing the automotive manufacturing sector’s maintenance technician apprenticeship. For both of these projects, we have been part of the employer design groups, advising on content from a training provider and skills perspective.
I’m proud that our apprentices are consistently ten per cent above the national benchmark for their achievements on their programmes and we are among the top providers in England for a third year in a row; this was recognised by Ofsted when they graded us as ‘outstanding’ in our June 2015 inspection.
Our support for businesses around apprenticeships is more far reaching than provision of training courses. There’s a lot of emphasis from central government on achieving the three million target by 2020 and with that comes a myriad of policy updates and publications that employers need to get their heads around – a time-consuming task for busy employers. Gateshead College will be running breakfast events to offer advice and guidance on the opportunities as well as the obligations that these policies will bring.
For more information speak to Gateshead College’s apprenticeship team
0191 490 2258