LEP boss urges firms to use unspent apprenticeship levy funds

apprenticeship levy
Roger Marsh

The Leeds City Region Enterprise Partnership is calling on apprenticeship-levy paying businesses across the City Region to make the most of unspent levy funds and consider supporting training opportunities across their local communities through a levy transfer.

As levy payments not used within 24 months are returned to central government, there are potentially millions of pounds in unspent contributions paid by businesses in Leeds City Region that could be put to good use in supporting the future workforce and local economy by helping to increase apprenticeship training.

Roger Marsh, Chair of Leeds City Region Enterprise Partnership and NP11, said: “Our  levy-paying businesses  have a key role in supporting apprenticeships across Leeds City Region and giving skilled people the opportunity to get on in life.

“Using your unspent levy funds to support local people and businesses can also have long-term benefits for your own business, as they can increase the skills within a sector and the local talent-base and make companies within supply chains more efficient.”

Cllr Susan Hinchcliffe, Chair of the West Yorkshire Combined Authority and leader of Bradford Council, said: “We all know there are unspent levy contributions which we want to keep in the region. Transferring the levy is one way local employers can help address local skills deficits. Under a devolved settlement we want to build on this and would like to see levy money raised by large organisations in the region staying in the region to benefit SMEs and local people.”

The LEP  has  piloted  a brokerage service between levy-paying employers and training providers for the purposes of levy transfer and has already seen successes, with Portakabin agreeing to fund 12 apprentices through their training programmes.

Nick Vernon, Head of Learning and Development at Portakabin, said: “In late summer, we became aware of the fact that some training providers across the region were facing funding challenges and there was a risk that they might have to turn businesses away. As an employer with unspent apprenticeship levy, we were able to take positive steps with an apprenticeship levy transfer and are now supporting 12 apprentices through their training programmes.

“It’s not just for a single academic year – we’ve made a long-term commitment to fund the full duration of the apprenticeships. We’re delighted to be able to support the development of apprentices at Portakabin and also within the City Region.”

The call for support comes as training providers across Leeds City Region have contacted the LEP reporting that they are turning away potential apprentices from employers that are under the threshold for paying the apprenticeship levy, due to a lack of non-levy funding for apprenticeships.

The LEP has conducted a poll of providers across the City Region, with the majority of respondents confirming that they are also in this situation. The LEP estimates that as many as 300 apprentices across the City Region may be unable to start their courses as a result of funding shortfalls.

The apprenticeship levy is paid by businesses with an annual wage bill of  £3 million or more, and  is used to fund  apprenticeship training and assessment. Levy-paying employers can transfer up to 25% of their contributions to support apprenticeships in smaller businesses.

Research with local  employers  ha s shown the value that an apprentice can bring to businesses:

· 86% of businesses said their apprentice helped to fill skills gaps

· 78% said hiring an apprentice improved productivity

· 83% said they would recommend an apprentice to another business

· 90% of apprentices stay with their employer after their course ends.

Businesses wishing to support apprenticeships can get in touch with the LEP to find out how they can make a positive difference and make sure vital opportunities for careers and development are available to people across Leeds City Region. The LEP can help businesses use levy funds to recruit their own apprentice or to transfer unspent funds to increase apprenticeship opportunities across Leeds City Region.