Chancellor George Osborne first proposed an “apprenticeship levy” last month in his Summer Budget, saying that too many large companies “leave the training to others and take a free ride on the system”.
The Treasury has not outlined the size or scope of the levy, saying only that it will “be applied to larger companies”, with revenues expected to help pay for the 3m new apprenticeships the government has promised to create by 2020.
Prime Minister David Cameron is set to open a new consultation on the apprenticeship levy today, asking employers for their views on the tax. But many business groups have already raised objections. Seamus Nevin, head of employment and skills policy at the Institute of Directors (IoD), said: “In the past, the training delivered by levy approaches has tended to be costly and bureaucratic.
“Apprenticeships need to be high quality and linked to the needs of businesses and learners”, he said. “The real solution to more quality apprenticeships lies in giving greater control over their content and structure to the firms that need the skills they provide.”
Neil Carberry, director for employment and skills at the Confederation of British Industry (CBI), agreed, saying, “We must not sacrifice quality for quantity.”
“The best way to drive up quality is to give employers real control and ensure that levy cash is committed to only funding apprenticeships in levy-paying businesses.