The apprenticeship levy - our key asks on reform

Background

The introduction of the Apprenticeships Levy in April 2017 has helped thousands of people enter the labour market and improve the skills base of those already in work. In local government our apprenticeship numbers almost trebled in two years. But the reforms have not been as seamless as many of us would have liked.

Apprenticeship starts overall have fallen, as have the number of people starting a level 2 apprenticeship, while initial delays in development and approval of new apprenticeship standards led to many employers not being able to fully embrace the new system as they would have liked. A 2019 National Audit Office report found that employers continue to face considerable barriers to spend their levy funds, despite their best efforts and some positive changes from government to the way the system works.

Since April 2019, any levy money that was unspent by a levy-paying employer for two years has expired on a monthly basis and been returned to government to be re-directed nationally into other areas of the apprenticeships system. This money is not always spent in the locations where it was generated or used to address the strategic skills needs of our local communities.

Apprenticeship funding could be used far more effectively if the system allowed for more flexibility and strategic planning so employers can collaborate more easily around transfers and pooling, by sector or place, to target support where it is most needed.

In April 2019, the LGA and 23 signatories wrote an open letter to the Rt Hon Damian Hinds MP, Secretary of State for Education, calling for action to be taken.

Our key asks

We can help increase apprenticeships and social mobility locally if the Government reformed the Apprenticeship Levy.

Voices from other sectors