How we spent our apprenticeship levy

With time running out to cash in the first tranche of funding, firms that have already been through the process share their pearls of wisdom

How we spent our apprenticeship levy

Insurance giant Aviva offered its first apprenticeship in 1919, so it is no stranger to bringing people in to earn while they learn. Yet despite its heritage, the introduction of the levy two years ago prompted a rethink in how it delivered training. 

“Historically, apprenticeships have been about bringing in young people and developing their skills. When the levy was introduced, we rethought where we offer apprenticeships,” says Sophie Gray, UK apprenticeship lead at the business. “The removal of the age cap is a great part of the policy, so now it’s not just about training new people. We wanted to bust the myth that apprenticeships are just for school leavers.” Aviva now offers more than 300 apprenticeships across multiple functions and locations, right up to master’s degree level. All of them are funded in some way by the levy. 

Not every employer welcomed the introduction of the apprenticeship levy in 2017 with such open arms. It requires businesses with an annual wage bill of £3 million or more to pay 0.5 per cent of it into a fund to be spent on apprenticeships and other eligible training – an obligation around a third of these firms still consider a ‘tax’, according to a recent survey by Alliance Manchester Business School. 

Yet with a matter of weeks until the first tranche of money runs out (the funds last 24 months from when they are credited to an employer’s account, so money from April 2017 would expire in April 2019), it’s a case of ‘use it or lose it’ for a huge number of employers. 

In fact, a survey of People Management readers between December 2018 and January 2019 (see below) found that just under a quarter plan to use up their levy funding before the April deadline, while half will not use it all. One in 10 say they have no plans to spend any of the money in their digital account.