Where it all started: MiddletonMurray’s preparation
This month marks a full year since the Apprenticeship Levy was introduced in the UK. And what a year it has been.
I stay close to education policy changes and so MiddletonMurray readied itself for the Levy’s implementation very early on, about 18 months ago. We introduced two significant changes to the business to ensure we hit the ground running.
To ensure we would be able to best support businesses with a pay bill of over £3million, we first put together an entirely new ‘Levy Team’ who had a specific skillset of dealing with the corporates first affected by the Levy. Initially we only put a small specialist team together but were poised to scale as needed and over time we have been able to dynamically work through the legislation to help employers succeed.
In this preparation period, we also developed visual and written materials – from films to explanatory leaflets and social content – to help educate people on what the Levy meant, and how it might affect their business.
Alongside educational content, we established a consultancy offering so that companies who wanted to get into the nitty-gritty of how the Levy worked could access that information and get bespoke advice, rather than generic guidance.
The impact one year on: broader thoughts on implementation
In retrospect, firms were slow to learn about the Apprenticeship Levy and when they did realise its positive potential, the urgency was somewhat lost because the funding was available in their accounts for two years. We believe the availability of funding combined with the knowledge that the minimum duration for an apprenticeship is one year led to industry-wide lethargy and the sense that there was ‘next year to sort it out’. We believe that this was a reason for many businesses not being as quick on the uptake as we would have hoped.
It’s been widely publicised that enrolment numbers for apprenticeships have fallen and I believe this is because apprenticeships providers missed the key SME market.
Unlike large corporations, many SMEs do not have the resource or capacity to leverage the apprenticeship and training opportunities out there. MiddletonMurray – unlike many other firms – continued to focus on SMEs rather than just corporate businesses who qualified for Levy support.
It is vital that companies approach SMEs directly – through face-to-face contact, networking, targeted digital campaigns and consultancy – and tell them about the opportunities of apprenticeships, which they then inevitably embrace.
Some companies have really embraced the new apprenticeships model; Menzies and Adecco are two examples of great companies who’ve worked with us to take on new apprentices.
Vision for next two years: maximise apprenticeships’ impact
There are some key legislative amends following the first year of the initiative that show me that the Levy is here to stay, and these amends are set to benefit many more UK businesses.
- The relaxation of the Levy’s rules to allow for 10% of a large employer’s levy funds to be allocated to other smaller companies along the supply chain is hugely positive and will encourage smaller businesses to consider apprenticeships.
- The shift in who can benefit from government supported training is also a powerful indicator of change; opening it up to any seniority level, type of apprentice and existing staff.
- In addition to this, the digital apprenticeship system will be available to SMEs from 2019.
The combination of these three factors has strengthened the apprenticeship system in a way that will engage SMEs and start to tackle the UK’s productivity crisis on a larger scale. I expect to see the number of SME apprentices rise to previous levels before long – and that the adoption of apprenticeship schemes by Levy-payers will be faster than we’ve seen to date, as awareness of the Levy’s manifold benefits continue to spread.
Rules of engagement
The key to engaging SMEs is to provide that crucial education piece: what apprenticeships are, how it can benefit the business, and how it can be used to upskill employees of all ages, not just the stereotypical young, newly recruited apprentice.
Businesses of all sizes have the same, very understandable initial concerns; they worry about the apprentice being off the job for 20% of the time as well as having to contribute to the cost of the apprenticeship. Although it’s a very cost-effective route to upskilling and recruitment, all businesses have tight budgets so need reassurance about how they can financially support apprentices and thrive from an apprenticeship scheme.
I feel positive about what the next two years will bring for the apprenticeship scheme. My vision is to make sure all companies are fully aware of what the Levy can offer them – and ensure that in cases where businesses are paying the levy, they don’t just see it as another tax. It is a cost-effective, smart way of training someone in the exact skills you require for your business in the long term – skills that you may not even realise your business needs yet!
You can read the full article published on 19 April 2018 at FE News