The Federation of Small Businesses (FSB) is calling on the Government to urge big businesses to prioritise sharing apprenticeship funds with small firms - in order to maximise technical skills development in businesses of all sizes.
Under the new policy which comes into effect from April 2018, apprenticeship levy-paying employers will be able to transfer up to 10% of their vouchers to other employers to use for apprenticeship training.
However, at present, this transfer can be made to employers of any size. FSB is warning that small firms, that are less able to invest in apprenticeships training, are at risk of being overlooked for this additional funding in favour of larger businesses.
With half (50%) of small businesses seeing technical skills as the most important skill for achieving future business growth, apprenticeship voucher transfers would support the development of key skills, such as digital skills, among smaller firms and would help sectors to grow or retain expertise.
Mike Cherry, National Chairman at the Federation of Small Businesses (FSB), said: “The UK’s small business community finds itself hamstrung by persistent skills shortages which is stunting innovation and growth. Apprenticeships are often seen as a great route for smaller firms to plug these skills gaps and drive growth.
“Allowing levy-paying firms to transfer unused funds provides the perfect vehicle to continue tackling the technical skills shortage, and could foster small business growth if designed, communicated and implemented correctly. However, small businesses need to be put front and centre of the scheme by encouraging levy-paying businesses look closely at transferring vouchers to smaller firms within their supply chain.
“There is a fear that, unless a focus is put on smaller firms, many will lose out to larger businesses who may already be paying the levy and that have more capacity and time to identify opportunities for voucher transfers. This would hit small businesses and would not achieve the intended purpose of the scheme which is supporting those businesses that are less equipped to invest in apprenticeships training, not only by providing essential financing but through help and guidance from a company that’s been there and done that.”
To support small business take up of the scheme, the Government should introduce a ‘matching service’, hosted on the Apprenticeship Service, the new web-based system through which employers monitor and spend their levy vouchers, where levy-paying businesses can locate smaller businesses wishing to receive funding.