Levy: The Corporate Tax Aimed to Create a New Workforce Generation

As of April 2017, employers with a PAYE over £3m will contribute with 0.5% of their payroll into an apprenticeships fund. Despite some concerns over the lack of details about the program, it seems to be a game-changer in the educational landscape of the UK. Ultimately, it will be an opportunity for every organisation to build a more skilled workforce – and a more productive business.


The new levy announced in 2015, was created to support the existing government funding for apprenticeship training. According to Chancellor Osborne, this initiative will raise £3bn a year over the next five years, and will help deliver 3 million apprenticeships by 2020.

While quantity doesn’t necessarily mean quality, this measure will be paired with more rigorous apprenticeship standards (The Trailblazer Initiative), and with the creation of a new independent regulatory body led by employers. This will hopefully meet their ambitions for improvement in training quality while growing in numbers.

The Treasury’s Productivity Plan also promises to bring the levy under employers’ control, enabling them to direct the funding through the Digital Apprenticeship Service to ensure the quality of training they need.

How will it work?

  • Companies with a payroll over £3 million will pay 0.5% of their employers’ pay bill into the levy fund, regardless of their current apprenticeships programs.
  • This tax will then be funneled and ring-fenced in the form of an electronic voucher that employers can use to purchase training from  recognised providers .
  • All organisations will be entitled to claim £15,000 p/annum for apprenticeships training, regardless of their size and PAYE. If companies don’t use this allowance, they will be unable to use it for any other purpose.
  • The first levy payments will be due in April 2017 and paid through Pay As You Earn. HMRC will work with employers and payroll service providers to simplify the implementation of these changes.

How will levy benefit organizations?

Efficient staff equals profitable business. In this sense, the levy incentivises corporations to think about the long-term development of their human resources and exponentially benefit from this initiative.

Among other advantages, it will allow organisations to:

  • Professionally train and upskill existing or new staff;
  • Get more qualified and efficient manpower;
  • Build a talent pipeline for the expansion of their businesses;
  • Increase their HR retention rates;
  • Increase productivity and profitability;
  • See a significant return on investment within the first year of taking on new apprentices;
  • Deliver a better brand experience to their customers;

As it seems, the new levy will allow corporations to build new and stronger workforce generations. If fairly conducted, it has the potential to boost the growth of key sectors and industries and – ultimately – to change the educational landscape of the UK.

 

To learn more about the levy or our apprenticeships programmes, call us on 03333 110 157 or email apprenticeships@F2Latwork.org.uk

Get ready for National Apprenticeship Week 2016

14-18 March 2016 sees the return of the popular National Apprenticeship Week. Co-ordinated by the Skills Funding Agency to celebrate the positive impact of apprenticeships and traineeships on people, businesses and the wider economy, it involves hundreds of events and activities across England.

 

During the week, employers, apprentices, business support organisations, colleges and training organisations and schools across the country will be encouraged to host activities to showcase the achievements and benefits of apprenticeships.

 

Over the next five years, the government is committed to three million new apprenticeships, so they are keen to promote their many benefits – and National Apprenticeship Week is the perfect opportunity to spread the word.

 

23,000 new vacancies were pledged in 2015

 

Apprenticeships and traineeships play an important role in upskilling the nation and increasing productivity, and during last year’s National Apprenticeship Week a record-breaking 23,000 new apprenticeship vacancies were pledged. 200 new businesses also joined the Trailblzer programme to design high quality apprenticeships, and degree apprenticeships were launched.

 

This year, the National Apprenticeship Service are setting their sights even higher, as their Director Sue Husband says:

 

“Last year’s National Apprenticeship Week saw some tremendous achievements, but I want next year’s National Apprenticeship Week to be the best yet. I am looking forward to once again raising the profile of apprenticeships and traineeships and celebrating the important role they play in equipping people of all ages with the skills that they need to prosper in their lives.”

 

You can find out more about this year’s National Apprenticeship Week here.

If I were 22…

Read our tips for those starting their journey onto the career ladder and get involved by using the hashtag:

#IfIwere22

Everyone deserves a second chance

So not everything has gone right for you. Everyone makes mistakes, so leave the past behind as now is your time to shine and prove to yourself  that you can take small steps to be the best person you can be.

You have so much to offer

The vibrancy of youth, your personality and eagerness to learn and succeed are inspiration to others. Someone may be more experienced or qualified than you at the moment, but value what you can offer now.

Follow your dreams but be realistic

When it comes to dreams, they are what keep us going in life, bring a sparkle to our eyes but sometimes dreams are not always a realistic approach to the world of work. You must consider that you have to financially support yourself and your dream might not be able to sustain this.

Learning doesn’t stop

Learning doesn’t need to stop when your first job starts. Throughout your career you will have many options for learning  and development. For example you could join the  440,400 young people aged 16-24 people who started an Apprenticeship in 2013/14, combining working with the added benefit of gaining qualifications.

Choose an internship

An internship or work experience programme is a fantastic start to trial a career path you wish to take, breaking the industry and meeting people who might actually take you on and give you the initial stepping stone to start the career of your dreams.

Don’t underestimate volunteering  

As well as being intrinsically valuable, volunteering helps support your career progression, learning new transferrable skills that you might not learn in the work place.

Work experience will get you paid work one day

Many people are often asked about their non-paid work experience in job interviews. Make sure you explore the opportunities around you at school, college, university or just among your friends and see if you can partner up with someone to produce something creative and worth telling a future employer.

Don’t take life too seriously

Being mature doesn’t equate to taking life too seriously. Having a job doesn’t mean losing a social life – if anything you can gain a social life; being surrounded by people from different backgrounds and of different interests to yours. Go out on week days, explore where you live and enjoy your youth.