Calls were issued this week for more clarity over what apprenticeship “brokerage” fees are allowed, after a film trade body unveiled a “match-making service” for levy funds.
The UK Screen Alliance has launched what it calls a “vital apprenticeship training fund” for small and medium-sized enterprises working in the visual effects sector.
The trade body is calling on levy-payers working in the film industry to transfer up to 10 per cent of their unspent apprenticeship levy to them.
It will then act as a “dating agency” to match donor companies with would-be apprentices.
The UK Screen Alliance will charge a 1 per cent brokerage fee for the businesses that take on apprentices, to cover its administration costs. It will not, however, charge any brokerage fee for its members. Companies are not allowed to spend apprenticeship levy funds directly on brokerage; charging a brokerage fee on top of this, however, is not explicitly outside the rules.
The chief executive of the Association of Employment and Learning Providers (AELP), Mark Dawe, has called on the government to clear up this grey area, and clamp down on any brokerage schemes that take funding away from frontline provision.
He said: “AELP has been asking the Education and Skills Funding Agency (ESFA) for clarification over what is and isn’t allowed under the rules. What we are certain about is that any scheme which takes money away from the training and assessment of the apprentice should be looked at.
“The increased levy transfer facility adds an urgency to the matter and we have been talking to the ESFA about how to deliver on the minister’s wishes that employers make full use of the facility.”
Currently, a company can transfer a maximum of 10 per cent of its annual levy funds to employers in its supply chain, or the wider industry in which it operates. This will increase to 25 per cent from next April after an announcement by chancellor Philip Hammond in October.
Neil Hatton, chief executive of the UK Screen Alliance, said: “We are not taking any brokerage fee from the levy transfer. It is an additional fee that we propose to charge to the recipient of the transfer in order to cover our costs of administering the scheme. No levy money flows through us and the brokerage is not taken from levy money.”
The organisation is “keen to see that excess unspent apprenticeship levy is used within our sector” to “increase the overall stock of trained, competent people within the industry for the benefit of the whole industry”, he added.
“We developed the match-making idea as we identified an issue with levy transfers in that small companies don’t know which large companies have unspent levy or who to ask within that company. There may also be some embarrassment about asking.
“Similarly, the larger companies don’t know which of the smaller companies are willing to take on apprentices. We act as an intermediary to facilitate those introductions, which lead to transfers that are entirely within the rules and spirit of what the government intends.”
A Department for Education spokesperson said: “As of April 2018, we have made it possible for levy-paying organisations to transfer up to 10 per cent of their annual funds to other employers. This will increase to 25 per cent from April 2019.”
