Every HR director in organisations with an annual payroll of £3 million or more will be well aware of the Apprenticeship Levy. With 0.5% of their total payroll going to the Levy, that amount of money is hard to ignore.
Yet from our experience it looks like many businesses are ignoring it, missing out on thousands of pounds available to fund training by not utilising the Levy transfer option.
There seems to be a gap in the connection and communication between large companies with excess levy, and the smaller businesses or charities that could really benefit from additional apprenticeship funding.
Transferring unused levy funds can be complicated and time consuming, it has to be acknowledged, because funds can’t be block transferred but must be transferred on a month-by-month basis.
Something that requires a quiet moment to study the system is exactly the sort of activity that gets pushed to the back burner when faced with sudden, day to day concerns like the coronavirus. However, because of its potential to change lives, and the sheer scale of money involved, the Transfer Levy deserves to be front of mind even while we are dealing with other HR issues.
Research released this week from the Department for Education revealed that just 25% of apprenticeship starts are in SME’s with less then fifty employees, and yet these are exactly the sort of organisations which could benefit from the use of Levy transfer funds.
HR Directors usually have a direct role in Corporate Social Responsibility (CSR) and Economic, Social and Governance (ESG) plans. Taking a proactive role in helping businesses or charities in your supply chain to access an Apprentice Levy transfer is a great way to show tangible delivery of your CSR or ESG objectives.
A company spokesperson said: “The Apprenticeship Levy has had a profoundly positive impact on the workforce and business here – we simply couldn’t see our unspent funds go to waste, and that’s where our hunt for a business or charity to which we could share our unspent levy began.
“Following research into a range of projects and services around the UK, we knew that supporting this charity was a fantastic choice from the outset. After talks with the charity CEO, we agreed that an initial pilot of 11‘Team Leader/Supervisor’ apprenticeships would make a fantastic starting point. With our company having a solid two-year relationship with training provider Qube Learning, we ensured they were top of the pecking order as the selected training provider in 2019.
“Having seen first-hand the multiple benefits to introducing apprenticeships into a business we cannot wait to see the impact the Apprenticeship Levy transfer and apprenticeships themselves have on the charity’s workforce and the charity as a whole.”
While the process of transferring funds can be slightly cumbersome, organisations like ours will be pleased to do much of the work for you in terms of finding worthy organisations to connect with, and delivering the Apprenticeships that are so desperately needed by many SMEs.
Figures from last year show that the amount of funds expiring in company digital apprenticeship service accounts in July 2019 was £44 million, and in August 2019 it was £52 million. Reaching out to an accredited learning provider like Qube with proven experience in this area is an easy way to unlock some of the potential this money could release.
For more information on Apprenticeship Levy transfers, visit www.qube-learning.co.uk/levy-transfers
- By 2019-20 the funding available for investment in apprenticeships in England will have risen to over £2.5 billion, double what was spent in 2010-11 in cash terms. Since it was introduced, the levy has directly supported almost 313,000 people to start their apprenticeship journey.
- Large employers accounted for 61 percent of all Apprenticeship starts in 2018/19 up from 46 percent of all apprenticeship starts in 2016/17. (DFE)