Hospitality apprenticeship scheme number drop as 40% don't understand

by XPRESS, 29 November 2018

Fewer than half of hospitality businesses have used the majority of their apprenticeship levy despite some funding expiring within the next six months, it has been revealed.

The research, commissioned by HIT Training, showed despite two thirds (66%) of companies being aware their funding will start to expire in May, only 49% have currently used most of it.

Meanwhile, 40% said they don't have a proper understanding of the levy.

The top reason (37%) given for why businesses have not used their funding was they are taking time to ensure they are investing in a high-quality programme. Meanwhile, 22% said they don’t have enough time to set up or extend an apprenticeship programme, 18% don’t understand the legislation and 18% haven’t found the right training provider to work with.

HIT Training managing director Jill Whittaker said: “It’s really concerning after 18 months of the legislation being in place, 40% of hospitality professionals admit they still only have a poor or very poor understanding of the levy. With contributions expiring after 24 months, businesses are at crunch point to start using or losing some of their funding pots. Not only will it directly benefit their own business, the hospitality industry as a whole is facing a skills shortage and so it’s more pertinent than ever for businesses to seize the opportunity to upskill their workforce, attract new talent and improve their staff retention.”

The levy requires all companies with a pay bill of more than £3m to contribute 0.5% of their payroll costs to the scheme, which they then claim back for apprenticeship training.

This amount is then topped up by 10% from the government. Businesses with pay bills below £3m don’t pay into the fund but they still have access to government subsidies of 90% of the cost of the apprenticeship, with the employers co-paying the additional 10%.

Article credit: Propel info