pprenticeships are an
obvious answer to the escalating skills crisis that threatens to hold back the British motor industry. With an expected shortfall of 160,000 workers by 2031 due to retirement, migration and technology, apprenticeships have the power to deliver enormous benefits to the automotive industry, helping to boost the supply of skilled labour. Yet many larger employers are forfeiting vast sums they have been forced to set aside
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under the Apprenticeship Levy – a government initiative designed to boost apprenticeships. Under the levy, employers with an annual wage bill larger than £3m must set aside the equivalent of 0.5% of their payroll to fund apprenticeships in England. The companies can either spend the cash on an approved apprenticeship scheme or transfer a quarter of their levy pot to smaller firms in their supply chain. However, with a decrease in apprenticeships, much of the pot is being clawed back by the government under a ‘Use it or lose it’ clause. Any unspent money is taken
back after 24 months, with the total returned reaching more than £2bn since the levy was launched in 2017. “The unclaimed levy pot is definitely a wasted opportunity,” says Frank Harvey, head of member services at the Independent Garage Association, an organisation that represents the repair sector. “If levy-paying businesses are not utilising their pot, there should be a clear opportunity and messaging to make this pot available to smaller employers to encourage and provide them with the confidence that any apprentice they take on will be supported.”