Tesco chairman John Allan has called on the government to “fix” the apprenticeship levy after criticising its complex administration.
According to The Telegraph, Allan – who is also president-elect of the CBI and business lobby London First – said businesses could give up on apprenticeships altogether and treat the levy as a simple tax if changes were not made.
“Unlike Brexit, which is difficult and complicated and not entirely in the hands of our Government, the Apprentice Levy is simple to fix,” Allan said, speaking ahead of a launch of a London First report.
“The Chancellor promised a review in the Budget last November. That as far as we can see has not yet happened.
“It is not working at all well. If you don’t want business to give up on this and treat it as just a tax you have got to make these simple changes. I think most business would agree with it.
“The sad thing is some businesses are giving up on apprentices altogether and just seeing it as another tax.”
As of April 2017, all companies with a pay bill of over £3 million have been forced to pay 0.5 per cent of their overall wage payments into the apprenticeship levy, whether they choose to employ apprentices or not.
This has proven a controversial measure and saw the level of new starters drop 61 per cent by October 2017.
The British Retail Consortium’s chief executive Helen Dickinson said last year: “The 61 per cent decrease in apprenticeship starts since the introduction of the levy confirms the retail industry’s view that the levy, in its current form, is not working.”