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Clarity needed around 10% apprenticeship levy top-up, providers warn

Request for further details after Treasury announces that the government will top up employers' monthly levy contributions

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Training providers and employers have called for clarity around the introduction of the apprenticeship levy, after it emerged today that businesses will receive a 10 per cent top-up on their contributions.

A document published by the Treasury, to coincide with Chancellor George Osborne’s Budget, reveals that employers which contribute to the levy from April 2017 will receive an extra tenth on top of what they pay in each month, which they can spend on “apprenticeship training through their digital account”.

“The government will set out further details on the operating model in April and draft funding rates will be published in June,” the document states. But in response to the announcement about the 10 per cent top-up, the Association of Employment and Learning Providers and the Chartered Management Institute called for further details.

'We need answers'

AELP chief executive Stewart Segal said: “We will need to understand how exactly the top-up will work and, in particular, how it will work for those only paying a small levy.”

CMI director of external affairs Petra Wilton added: “Business urgently needs further clarification from the chancellor on the funding of the quality apprenticeships that will sustain Britain’s economic growth."

During last year's spending review and autumn statement, Mr Osborne announced that a levy on companies to fund apprenticeships will be set at 0.5 per cent of an employer's pay bill. It is expected to raise £3 billion in an attempt to fund 3 million apprenticeships during the current Parliament. The government says the levy will only be paid on employers' pay bills over £3 million, resulting in fewer than 2 per cent of UK employers paying it.

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