Review of the Apprenticeship Levy still vital, says Logistics UK

The business group argues that the Levy model must allow greater flexibility, and ensure funds are more accessible to businesses which are looking to resolve industry’s skills gaps.  

“The current Apprenticeship Levy does not work for all sectors,” said Jonas Keat, Policy Advisor at Logistics UK.

City & Guilds research demonstrates that of 1,000 HR leaders, 94% reported facing at least one barrier to accessing their Levy funds, with combined research between City & Guilds and the 5% Club showing that UK employers have spent an average of just 55.5% of their Apprenticeship Levy funding over the past five years.  

Keat continued: “Logistics UK is asking for the current format to be amended into a Training Levy which will allow more flexibility so that companies can utilise the funding available. Having originally called for this in March 2021, we have reiterated these calls within our recent Spring Budget submission as the recruitment situation still needs to be addressed. Apprenticeships have a vital role to play in the development of a skilled workforce and solving the sector’s long-term skills shortage.  

“Workers currently looking to access apprenticeships are being held back by the minimum skills requirement which dictates that people can only take up an apprenticeship if they have achieved a minimum standard of maths and English. While this requirement might be viable in other sectors, within the logistics industry, skills and experience are more essential in some roles – industry is not a ‘one size fits all’ employer. Following conversations with members, Logistics UK believes this requirement is preventing a potentially valuable group of young people from joining the workforce via the apprenticeship route. 

“The creation of a Training Levy, to replace the existing Apprenticeship Levy, would allow companies to solve their own skills shortages in the short term by allocating Levy funding for training programmes which do not necessitate a year-long apprenticeship – such as HGV driver training. The implementation of a Training Levy would also enable businesses to offer training to those who don't fall within the 16-18 age range required for an apprenticeship, but who still have much to contribute to the sector.” 

The overwhelming majority (99%) of logistics businesses are classed as SMEs. However, apprentices aged over 18 years who work for smaller businesses which employ fewer than 50 employees, are currently ineligible for full funding.

Keat continued: “Paired with the requirement for a 20% minimum off-the-job training, this mismatch between available candidates and roles on offer results in a lot of valuable time being wasted in certain programmes, and highlights the inflexibility of the apprenticeship system for both employers and employees in logistics.  

“Overall, there are still not enough apprenticeships being offered for logistics roles in general, and currently only Level 3 roles, such as mechanics, and above are eligible for funding through the National Skills Fund (NSF). We need this funding to be extended to selected Level 2 roles (such as HGV drivers) which are currently experiencing shortages. Our industry wants to see more collaboration with the government to address our recruitment needs, including continued support for our industry-led Generation Logistics campaign, and more relevant apprenticeships being offered.” 

*www.logistics.org.uk/skills

Published On: 23/02/2023 16:00:47

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