The organisation that represents work-based training providers in Wales has written to the Welsh and UK Governments seeking detailed information about how the new Apprenticeship Levy will impact on the nation’s highly successful apprenticeship programme.
The National Training Federation for Wales (NTfW) wants a commitment from both governments that all money raised by the levy is fairly distributed across the UK for employers to spend on apprenticeships.
The NTfW has also called for a meeting with UK Skills Minister Nick Bowles to discuss the practical implications of the levy, which was highlighted by Chancellor George Osborne in the UK Government’s recent Comprehensive Spending Review.
Concerns have been raised by the NTfW, echoed by Wales’ Deputy Minister for Skills, Julie James, that a levy of 0.5% of payroll costs on all large UK employers to fund new apprenticeships paid through PAYE will have major consequences for the Welsh Government’s own apprenticeship programme
Due to be introduced in 2017, the levy will apply to both private and public sector employers and there are concerns that the knock on effects on employers, funding and the current apprenticeship programme in Wales have not been fully considered.
UK Government’s ‘Vision for 2020’ states: “By 2019-20, the levy is expected to raise £3 billion in the UK. Spending on apprenticeships in England will be £2.5 billion, and Scotland, Wales, and Northern Ireland will receive their fair share of the levy.”
The NTfW is keen to establish what methodology the UK Government plans to use to ensure that Wales receives its ‘fair share’ and how it envisages that money raised by the levy will be allocated to the nation.
A report commissioned by the NTfW earlier this year revealed that apprenticeships in Wales generate more than £1 billion a year for the nation’s economy and represent excellent investment for the Welsh Government.
Peter Rees, NTfW chairman, said: “There is a great deal of concern amongst our membership that a decision has been made in Westminster which has had very little regard for the potential impact on apprenticeships policy here in Wales. After all, this is a devolved matter.
“We are not against the principle of an apprenticeships levy. In fact, in our response to the Welsh Government’s consultation on co-investment in skills, we encouraged them to explore how this could work in Wales.
“We agree with the Welsh Government when they say that the announcement of the UK Apprenticeships Levy has cut across the devolution of skills policy and has only served to confuse the situation for employers. That’s why we have written to both the Welsh Government and the UK Government to seek clarity on the situation.
“We are calling for an immediate analysis of how the levy can be used to increase the uptake of apprenticeships here in Wales in a way that minimises bureaucracy for employers, maintains Wales’ high quality provision and ensures that the backbone of the Welsh economy – micro and small businesses – are not forgotten as large employers race to recoup what they have paid in.
“As a Network, we remain committed to delivering high quality apprenticeships for individuals and employers across Wales. We will continue to work with the Welsh and UK Governments to understand the detail of the levy and its potential impacts, in order that we can keep employers and their representative bodies informed of developments.”