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A skills and growth levy would be a good first step to addressing labour market challenges, says AoC

03 June 2024

David Hughes 5

David Hughes, Chief Executive, Association of Colleges, said: “The Labour Party proposal to transform the apprenticeship levy into a skills and growth levy is a good first step in addressing the labour market challenges that have been holding back economic growth whilst giving young people and adults the training and skills they need to flourish. The apprenticeship levy has not delivered for young people, for new labour market entrants nor for those from the most disadvantaged households and regions. Employers have felt frustrated at the need to spend all of it on apprenticeships, and at the red tape surrounding it which hampered delivery.

"Labour has clearly listened to what we and many others have been saying about the shortcomings of the current levy. The proposals will offer employers the chance to use the levy on more cost-efficient training to support employees to adapt and thrive as jobs and technology change. The option to support pre-apprenticeships for young people should also open up opportunities that are absent currently.

"The youth guarantee is an important ask we have made so I am delighted to see mentions of that too, and I look forward to seeing more detail on the design and funding of it.

"For the majority of adults, of course, the apprenticeship levy is irrelevant because they work for smaller and medium sized businesses that do not pay the levy and are not involved in the apprenticeship programme. I would like to see more commitment to grow training and skills funding in colleges for those adults who need to learn in a rapidly changing world. Without an urgent and significant growth in opportunities in colleges, millions of adults risk being left behind as technology changes."

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