New apprenticeships levy puts CITB levy in doubt

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The governments plan is to make 3 million apprenticeships by 2020 which will be aided by a new levy introduced to all large employers, but this will conflict with the existing CITB levy which is paid currently by construction companies at %0.5 who turn over more than £79,999.

This could mean that the construction industry could pay twice but the plans are still in a consultation period.

According to the new consultation : “The apprenticeship levy will be economy wide and larger employers in the construction and engineering construction industries will be in scope of the levy  alongside all other larger employers in the UK economy.

“On that basis  government and the industries need to decide how best the existing levy arrangements respond to the apprenticeship levy.

“One option is for employers in the construction and engineering construction  industries to pay the apprenticeship levy whilst continuing to pay the existing industry levy.

“If this were to happen we would expect companies in the  industries to fund their apprenticeships using the apprenticeship levy.

“Another option is to potentially remove the statutory industry levy arrangements  completely, so that employers only pay the apprenticeship levy.

“This would represent a significant change to training arrangements in the construction and engineering construction industries and we would need to understand what  effects this would have on the skills and capabilities of the UK construction  industry.

“The Construction Industry Training Board and Engineering Construction  Industry  Training Board will consult with employers before the introduction of the  apprenticeship levy on whether they should continue to pay the industry levy.”

The all-industry level is due to start in April 2017.

The CITB currently has  an agreement with Parliament to raise the levy until March 2018 when it will come up for renewal again.

The Government said it will also take a company’s apprenticeship record into account when awarding large government contracts over £10m

Transport Secretary Patrick McLoughlin has also announced an ambition to boost apprenticeships across the road and rail industry – pledging 30,000 apprenticeship places in the sector during the lifetime of this Parliament.

Alex Meikle, Director Employment and Skills, Electrical Contractors Association said: “We recognise the pressing need for the whole of industry to get behind the drive to increase apprenticeships.

“Much detail remains to be worked up but we are supportive of a levy on employers and hope this will support those who currently invest to continue and incentivise those who do not engage with apprenticeships to begin to do so.”

To read the full consultation please click here apprenticeships-levy-consultation