The unique Apprenticeship Levy Transfer Fund set up to supercharge apprenticeships in the West Midlands has hit a £5million milestone thanks to contributions from large employers.
And the fund has now created 100 new apprenticeships at small to medium-sized business across the region.
The West Midlands Combined Authority (WMCA), which controls the fund, says the £5m milestone is just the start - it is hoping to secure up to £40m to rejuvenate apprenticeships across the region.
Infrastructure technician apprentice Connor Lines, 18, with Jay Rixon, operations manager at Lansalot Computer Solutions in Redditch
Local people, like 18-year-old Connor Lines, are already benefitting from the fund.
Connor, from Bromsgrove, joined Lansalot Computer Solutions in Redditch as an Infrastructure Technician apprentice in August.
He said: “I did sixth form and did BTECs in engineering, applied science, IT and an AS in physics, and I knew I wanted to do an apprenticeship after - I wanted to do something hands-on, so university wasn’t something I was particularly interested in, sitting and listening to someone rather than getting involved. That’s also one of the reasons I initially wanted to be an engineer.
“I had no idea I would get into IT. When I heard about the apprenticeship with Lansalot, I went in for a chat and everything seemed really good, and I started in August. It’s been really good so far, it’s worked out really well. I love it.
“The apprenticeship lasts for 18 months, and I’ll learn lots about the job in that time. Once it’s over, we’ll have a chat and I’m hoping it leads onto a full-time job.
“I’d definitely recommend apprenticeships to other people.”
Jay Rixon, operations manager at Lansalot, said: “We’re a tiny weeny family business and there was no way we could afford to pay for apprentice training as well as their wages – so being able to get the training paid for, for free, is brilliant.
“There is still some cynicism about apprentices – I think some businesses don’t get that the training is covered for free, they think they want something in return. But they don’t – and it’s great.
“Connor is our third apprentice – the previous two are now full-time staff – and we knew the benefits of having an apprentice but just would not have been able to afford it without the levy funding.
“I think apprentices are a really good way for young people to get their heads around the real world of work – you see people come out of university with no idea how to behave in the workplace, what the expectations are. With apprentices, you can train them in the job but also help them in life: we’ve helped our apprentices to move into their own apartments.
“I’d encourage all small businesses to look into apprentices and the funding from WMCA – even if it doesn’t seem like it’s for them, it’s worth doing the due diligence and seeing if these new apprentice programmes could help their business.”
Andy Street, the Mayor of the West Midlands, said: “We’ve made excellent progress with the apprenticeship levy since our £69m Skills Deal agreement with Government last summer.
“We knew we could make a real difference to people’s lives in the region by taking local control of levy payments - keeping money in the region which would’ve otherwise been lost to central Government in London, and using it to support small to medium businesses to meet the costs of apprenticeship training.
“Thanks to organisations like HSBC, National Express, Lloyds, and, most recently, the University of Birmingham, we’ve already been able to transfer across £5m into our fund - all of which will benefit people across the West Midlands.
“I’ve met some of the apprentices who have been hired as a result of our fund, and it’s clear we are making a difference to their lives. The next step is to continue to get more firms to sign up to the levy so we can hit our £40m target, allowing us to create more apprenticeship opportunities, benefitting both businesses and residents across the region.”
The apprenticeship levy is charged by HM Revenue and Customers on all businesses with a payroll over £3 million. The levy money is held centrally by Government, and businesses across the country can apply for a slice of that funding to pay up to 90% of the costs of training their apprentices. After a two year period, unspent levy contributions are ‘sunset’ and retained by the Government.
The £69m Skills Deal agreed with Government in summer 2018 gave the WMCA power to transfer unspent apprenticeship levy from large businesses to small to medium-sized enterprises (SMEs) to cover 100% of their apprenticeship training costs.This approach keeps levy money within the West Midlands region, and avoids the risk of it being sunset.
The £5m contributed so far is the result of a number of firms agreeing to transfer their unspent levy to the WMCA – including HSBC, BT, BBC, Lloyds, SUEZ Recycling and Recovery UK, National Express, the Wesleyan and, most recently, the University of Birmingham.
Cllr George Duggins, WMCA portfolio holder for productivity and skills and leader of Coventry City Council, said: “This is a great milestone and shows we’ve made a strong start in using levy money locally to create new apprenticeship opportunities.
“Now we want to accelerate our progress to create hundreds more apprentices and build up the funding available to SMEs to take on new apprentices or upskill their existing staff with apprenticeship qualifications.”
The authority is now calling on employers who may not have considered hiring apprentices to tap into its unique Apprenticeship Levy Transfer Fund. Large organisations are also being encouraged to get in touch to discuss transferring their unspent levy. For more information, visit www.wmca.org.uk/apprenticeship-levy