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Hot topic: Apprenticeship levy

Will the apprenticeship levy help close the UK's skills gap? Will businesses be able to handle the extra costs?

The Autumn Statement contained a "sting in the tail" in the form of the apprenticeship levy, according to the CBI. Due to come into force in April 2017, at a rate of 0.5% of an employer's pay bill, will this measure help to close the UK's skills gap? Will businesses be able to handle the extra tax, in addition to the National Living Wage, and will it help to improve the quality of apprenticeships?

Marguerite Ulrich, HR director at Veolia, says:

"Apprentices are the lifeblood of this country. Three of the biggest issues facing UK Plc are developing young talent, upskilling our workforce and boosting productivity. Young people need to have a good start to their working life and apprenticeships have shown they deliver the essential skills we need.

The Autumn Statement announced the apprentice levy and Veolia fully supports the idea of more apprenticeships. However, we have yet to see how this will work. We hope when it is announced it will continue to encourage more opportunities.

This is central to how we should do business. Our solution lies in board-level commitment to apprenticeships and we have completed almost 1,300 apprenticeships in the last five years. This will realise the economic benefits of using the talent and ideas of the younger generations, who will become productive as they grow.

The rising green economy is also presenting many exciting new employment opportunities. The Circular Revolution report by Imperial College London estimates that the value of this business could be around £2.9 billion per year and create around 175,000 jobs. Many of these will be filled by apprentices who have gained knowledge and the skills needed for the green economy.

But we all know it has to cut both ways. The best endorsement of our L&D programme came from one of our apprentices at an awards event. “You earn while you learn,” he said.

The opportunities are now there, particularly in engineering and technology where there is a great skills shortage. We need to inspire people, provide the opportunities, and mentor them through their careers so that they can realise their potential and contribute to the future.

We all need people with the right skills to drive our businesses forward and we must remain committed to upskilling at every level to make sure this happens."

Check back tomorrow to read part two of this Hot Topic