Spend unused apprenticeship levy on early years training, LEYF urges
Joe Lepper
Wednesday, February 10, 2021
A major childcare provider is calling on large employers across all sectors to transfer any unspent funding for apprenticeships to early years providers to shore up their training and recruitment.
The Apprenticeship Levy is a tax on all employers with an annual pay bill of more than £3m that can be used to fund apprenticeship training.
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Under new government guidelines employers can now transfer up to 25 per cent of their lLevy funds to other employers – especially to those smaller organisations struggling to fund vital apprenticeships.
The London Early Years Foundation (LEYF) is calling on such organisations to support nurseries and childminders to help tackle a funding crisis for the early years sector during the coronavirus pandemic.
The money is urgently needed to “attract and train new talent” and meet the £6,000 costs of training each early years apprentice, said LEYF.
It says that around 5,000 business fail to spend all the money allocated to them for staff training through the levy scheme. An estimated £400m in funds for training expired and were returned to the government between May and December 2019, LEYF added.
The call has been made to coincide with National Apprenticeship Week (February 8-14).
“The early years sector is essential for working families, young children and our economic recovery and must be properly supported rather than hung out to dry,” said LEYF chief executive June O’Sullivan.
“If we can’t afford to train new apprentices then this puts another huge strain on the sector and significantly reduces the number of apprentices we take on and limits the pipeline of newly qualified staff.
“What’s holding back large companies from sharing their levy is that they are either unaware of how the levy works and how it’s routinely expires without being used, or they are finding a loop-hole to train their graduates in a new skill that will benefit their company without it affecting their salary costs – which is morally wrong.
“With approximately 1.72 million unemployed people in the UK, surely the right thing to do is help support the economy and other businesses by transferring unwanted levy funds and get people back into work."
Last month the Institute of Fiscal Studies warned that likely funding requirements for early years providers this year may leave viable settings at risk of going bust.