The EEF has clashed with the government over the flagship apprenticeship levy scheme
Manufacturers have called on the government to delay the introduction of the apprenticeship levy as just one per cent of employers said they backed the policy in its current form.
Manufacturers’ body, the EEF, has today ramped up its warnings over the levy, saying that the government faces a “looming car crash” after it found most employers believe the scheme is doomed to fail.
“The present rush towards an April 2017 rollout could prove detrimental for both industry and government, ushering in a policy doomed to fail and potentially causing long-term damage to drive to boost apprenticeships in the UK,” the EEF said.
Read more: Everything you need to know about the apprenticeship levy
“Firms can see serious flaws that could sink this policy at launch,” said Tim Thomas, director of employment and skills policy at EEF.
The levy will be charged at a rate of 0.5 per cent on an employer’s total staff costs above £3m and is scheduled to come into force next April. Three-quarters of manufacturers surveyed by the EEF want that to be pushed back. More than half said they find the scheme confusing and 54 per cent said it will just end up being another cost on businesses.
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Gordon Marsden, Labour’s shadow minister for apprenticeships said that the government had “still not answered the mounting chorus of concerns from employers” over the levy.
Just one in five manufacturers said the apprenticeship levy would help meet the government’s target of three million new apprenticeships by the end of the decade, as a separate poll from the group showed only 30 per cent think they will hire enough apprentices to cover the costs of the charge.
Skills minister Nick Boles hit back at the EEF's claims:
For decades British industry has under-invested in skills and engineering businesses consistently complain about a shortage of higher technicians.
This is not a time for dither and delay: British industry needs to boost its investment in skills and the apprenticeship levy will ensure that it does.
The EEF is the latest of the big employers’ groups to warn against the levy in its current form.
Last week the CBI called for a “radical rethink”, and raised doubts over whether the scheme will even be finalised in time for a launch in under 12 months.
The Institute of Directors has also said the government should delay the scheme to avoid “confusion” and the British Chambers of Commerce echoed the concerns.