Accounting Standards

Apprenticeship Levy seen as an ‘extra tax’, says MPF

Accountants are calling to simplify the Apprenticeship Levy process to provide “more flexibility in the standards”, according to recent research by the Managing Partners’ Forum (MPF).

The association said despite the Institute of Apprenticeships and Technical Education (IOA) having “materially improved” its performance, the levy system “remains unpopular” with 42% (45%) of the firms that pay the levy not receiving anything back, and only 39% of levy payments expected to be utilised by the two-year expiry date.

Although the levy has resulted in increases in the numbers of Levels 5 to 7 apprentices at sector firms, the MPF said that much of this was down to labelling ‘trainees’ as ‘apprentices’.

Additionally, some 60% of firms said the levy had “complicated learning and development” (L&D), and 32% said that it has displaced budget away from the most needed L&D. Some 28% also said that it has made professional development “less attractive” due to the label of ‘apprentice’, and a further 24% said that it has increased the cost of training.

A statement by the association read: “Simplify the payment schemes so employers didn’t lose their levy fees because there wasn’t relevant apprenticeships developed in time. Allow some of the levy fees to be used for genuine learning and development which would positively impact their business.”

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