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Small businesses missing out on apprenticeship funding

By - World Infrastructure Journal

Small businesses missing out on apprenticeship funding

Substantial financial support is unclaimed and available to SMEs to boost workforce training. Take action now before funds are withdrawn,” urges Adrian Grove, Business Development Director at Qube Learning

Some £157 million which could be used to develop and reinforce British workforces in the wake of the pandemic, was instead returned to the Treasury last April.

April’s figure is the highest monthly amount to have ‘expired’ in the government’s Apprenticeship Levy Fund since May 2019, when the transfer facility was established. In fact, in May this year the government’s apprenticeships minister replied to a parliamentary question that £1 billion “had expired between May 2020 to February 2021. "

This is an enormous funding resource that could so easily be used to help address the current skills shortage which is now so apparent across numerous UK sectors including healthcare, life sciences, med-tech, social care, infrastructure and technology. What’s more, with in excess of 700 apprenticeship standards to choose from – far exceeding what was available ten years ago – in a post pandemic, post Brexit world, training new candidates in both large companies and smaller organisations is key to the UK’s future economy and global standing.

Employers can also utilise apprenticeship funding to help upskill support staff within these sectors and other types of business, including roles in customer services, administration, and team leadership. There are apprenticeship courses to work as a Customer Service Practitioner, HR Support, Project Management, and Chartered Manager which build skillsets applicable across many different industries.

While most, if not all large organisations with an annual payroll of £3 million+ know about the Apprenticeship Levy, awareness of the Levy Transfer option is clearly much lower. The transfer is designed to allow levy-paying employers to move up to 25 per cent of their company Apprenticeship levy payment to multiple employers; so, by sharing a proportion of their levy total, larger businesses can help cover the costs of training in smaller companies.

Larger businesses could transfer funds to an SME in their supply or research chain. This could possibly be a small business without the resources to fund apprenticeships itself. Alternatively, they could transfer funds to a charity supported by the company which would benefit from taking on apprentices. The possibilities and funding are there, it just takes some ‘bigger picture’ thinking to ensure they are realised.

The contribution a levy transfer can make to Corporate Social Responsibility (CSR) and Economic, Social and Governance (ESG) plans is also self-evident here. Turning a levy transfer into a proactive means to help businesses or charities meet their training needs and ambitions is both an effective and efficient way to demonstrate tangible delivery of CSR or ESG objectives.

There is, however, no escaping the fact that in the last two years alone, UK employers have lost £2 billion in apprenticeship levy funds that they have been unable or unwilling to spend – funds which could have been transferred to SMEs to support and address the national skills shortage.

Many large, and sometimes even global scale companies here in the UK use the Apprenticeship Levy and routinely have large amounts of funding leftover at the end of the year. This is a huge opportunity for SMEs which can take advantage of the transfer as a ‘gift’. It is a chance to upskill and grow small business workforces from Level 2 upwards, at low expense. And given that SMEs take on around 60 per cent of total employment in the UK, it should be a given that leftover funding is directed at these companies to access the skills they need to grow.


So why are SMEs not grasping this opportunity?

In some instances, I suspect that SME directors who are aware of the transfer option are wary about starting an apprenticeship programme because they perceive it to be too complicated, expensive, or simply too much to manage on top of current workloads.

And that thought is not without a grain of truth. Transferring unused levy funds can indeed be complicated and time consuming; it requires monthly actions so needs both time commitment and system training – activities that lose priority over more pressing matters. However, because of its potential to boost productivity and profit, and the sheer amount of money involved, the transfer option should really be too valuable to ignore.

Further, a vast number of SMEs are simply unaware that there are funds available for them to apply for. A disconnect is apparent between large companies with excess levy, and the smaller businesses or charities that could really benefit from additional apprenticeship funding. Awareness that such a transfer is possible is low.

The reality is that there are many large companies with unspent funds, looking to connect with and transfer funds directly to SMEs. Organisations like Qube Learning can help bridge that awareness gap and are able to support both large companies and SMEs in connecting, transferring funds and delivering the Apprenticeships that are needed by smaller firms.

Reaching out to an accredited learning provider like Qube Learning is an easy way to unlock the potential this money could release – and prevent billions more being returned and the opportunity for growth wasted.

As we emerge from the 2020-21 global pandemic, it is more important than ever to invest in the UK’s future workforce and build a trained body of professionals. Apprenticeships, whether in large companies or SMEs, are vital to meet current demand for skilled workers over a sustained period, supporting our economic recovery.

Let’s not waste this golden opportunity to upskill the nation at the most critical time.

For more information on Apprenticeship Levy transfers or for help finding a donor/recipient organisation, please visit www.qube-learning.co.uk/levy-transfers


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