Business South calls for urgent review of the UK apprenticeship levy to fix employee skill gap

Major names in business and education across the central south are clamouring for change to tackle the growing skills gap in the region.

Organisational leaders presented an open letter at the House of Commons during a recent visit, organised by Business South.

Gosport MP Dame Caroline Dinenage accepted the letter and has already shared it with Kwasi Kwarteng, MP, Secretary of State for Business, Energy and Industrial Strategy (BEIS).

One of the supporters of the review is Zoe Huggins, chair of the Business South workforce south action group.

She said it was urgent and Business South would launch a campaign to highlight the issue.

He said: ‘With the current skills disparity affecting almost all sectors and the imbalance in payroll being at its highest, the 1.3m vacancies, and the issue of real earnings versus the cost of living, now is the time to take action and give employers flexibility in their levy spend.’

The letter highlighted three major factors.

Business leaders called for skill credits to spend on internal training schemes and vocational training.

These credits would allow for greater training flexibility.

Recruitment credits for businesses were also pushed, which would support the relocation or travel of staff on the lowest salaries, such as apprenticeship wages.

Placement credits were also called for in the letter, so money from their apprenticeship levy can be spent on training programmes.

Dr Jamie Mackay, skills strategy manager at the Enterprise M3 Local Enterprise Partnership, said changes are needed.

He added: ‘The EM3 Advisory Panel is the place to go for employers across Hampshire and Surrey to share their recruitment and skills challenges.

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‘Since 2019, the panel has heard from businesses across our local economy who would like to see the levy made more flexible so they can spend it on more tailored skills provision to meet their needs and enhance local economic growth.’

Ms Huggins added: ‘We believe with attention and employer involvement there can be a solution that addresses the skills crisis, the skill budget, and gives more employer flexibility.

“We have a collective commitment to not just make sure apprenticeships are of high quality but to add the right value to our people and our communities.’