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Apprenticeship Levy

To: All Build UK Members

Based on the feedback received from members, we have developed a Build UK response to the Government’s proposed Apprenticeship Levy.

Member Views

Build UK members that are in-scope to CITB confirmed their support for the principle of a levy on PAYE employees as well as retaining an additional levy on Labour Only or Net CIS Sub-Contractors in order to deliver the apprenticeships, training and qualifications required to meet the industry’s skills needs now and in the future. The majority would not be prepared to pay both the Apprenticeship Levy and the CITB PAYE Levy.

Build UK members that are out of scope to CITB raised concerns about the introduction of an Apprenticeship Levy; however, it is understood that an Apprenticeship Levy of some kind will be introduced by the Government whatever the response from employers.

The Industry’s Skills Needs

The structure of the construction sector, whereby the majority of apprentices are employed by SMEs and a substantial amount of supplementary training is required, means that the Government’s proposed Levy and Voucher system would not deliver the number of apprentices and skilled workforce required. Therefore a solution which recognises the ambitions of Ministers and integrates the Apprenticeship Levy into a reformed version of the current CITB Levy and Grants Scheme would be most appropriate and achieve the desired outcome. For those employers out of scope, Build UK will work with the CBI in an attempt to ensure that any levy works effectively for employers and meet its intended objective.

Build UK Proposition

  • Large employers in construction would all be required to pay the proposed Apprenticeship Levy
  • The Apprenticeship Levy contributions of those large employers in-scope to CITB would be channeled back to CITB and ring-fenced specifically for the delivery of apprenticeships
  • Large employers would continue to pay the remainder of their CITB levy contributions: so payment of 1.5% on total labour only sub-contractor payments (assuming Apprenticeship Levy is 0.5% of PAYE)
  • All other employers in-scope to CITB and above the CITB threshold would continue to pay the CITB levy without any change.

Responding to the Consultation

It is essential that the construction industry presents a united view and works collectively to achieve the best outcome for the sector. We would therefore ask members to confirm their support for the Build UK response by Wednesday 30 September and reflect it in any individual responses to the consultation document.

If anyone has any comments or queries on this issue, the main contact within the Build UK team is:

Simon Nathan – Policy Director
0844 249 5351
Simon.Nathan@BuildUK.org

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