Apprenticeship levy one year in

10 May 2018

April marks the first anniversary of the introduction of the apprenticeship levy and concerns have been raised that schools and academy trusts are not making the most of the millions of pounds they pay into the apprenticeship levy.

Schools Week reports that concerns about schools’ understanding of the levy have been raised by a training specialist, who said he was “shocked” by how little was known, while a senior MP has also started looking into the issue after raising concerns with ministers.  Dave Cobb, from the National College of Education, which was set up last October to run courses aimed at helping schools use their levy money, said his organisation had spoken to more than 40 trusts and signed up around 400 apprentices, but was worried about schools’ engagement.

Anneliese Dodds a shadow Treasury minister who has criticised the government for failing to analyse the impact of the levy on schools contacted the schools minister Nick Gibb but was told the government is waiting to receive reports from schools on their progress, which aren’t due until September.  She said “We’ve had schools consulting on whether they should reduce their hours to save money. At this critical time, I find it strange that the government hasn’t analysed what the benefits are for schools.”

Schools aren’t alone in ignoring their levy funds. The number of people starting an apprenticeship has fallen by around 30 per cent since the levy was introduced this time last year. Under reforms that came into effect last April, employers with an annual payroll of more than £3 million must pay 0.5 per cent into the apprenticeship levy and each receives an annual allowance of £15,000 to offset against it. They can then use money from the levy pot to pay for training.

For example, an employer with a payroll of exactly £3 million would not be liable to pay anything, because that £15,000 tolerance would completely offset the charge. An employer with a £5 million payroll would have to pay £10,000, which is their £25,000 charge at 0.5 per cent of their payroll, minus the £15,000 allowance.

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