A more flexible apprenticeship levy could increase the number of apprenticeships by up to 50% according to a Tesco report into the supermarket’s economic and social impact.
It suggest that “simple” reforms to the apprenticeship levy could bring thousands more young people into employment and that the rules on how funds are spent mean that Tesco and businesses like it cannot fund broader learning and shorter training courses.
Ken Murphy, Tesco chief executive, said: “There is a real opportunity here to boost jobs growth, after one of the most challenging years. What we’re asking for is simply the flexibility to use the apprenticeship levy to its full potential and give young people the valuable skills, training and experience that will translate into better opportunities in their careers.”
Tesco is proposing three reforms:
- Allow up to 10% of apprenticeship levy funds to be used to support high quality pre-employment and pre-apprenticeship programmes
- Allow funds to be spent on shorter courses
- Allow 10% of levy funds to cover a portion of apprenticeship costs outside of training, allowing smaller employers to significantly expand the amount of apprenticeships they offer.
The Tesco report, produced by public policy research specialist Public First, sets out the retailer’s contribution at a national and local levels, helping the supermarket identify its impact on customers, colleagues, and communities.
It suggests that reform to the apprenticeship levy could lead to an additional 8,000 new apprenticeships across the retail sector each year, with 500 at Tesco.
As the UK’s largest private sector employer, with more than 300,000 staff, the report says that, working across its extended supply chain, Tesco supports £53bn for the UK economy, and nearly 1 million jobs.
In the five months to January 2021, the number of apprenticeships declined 18% year on year, with 36,700 fewer places. Level 2 apprenticeships have been particularly affected with the number of starts in 2019-20 just one third of the level in 2014-15.
Tesco says that added flexibility would allow it and other retailers to offer more tailored training courses, to help more people learn retail-specific skills. It would also allow courses that develop pre-employability skills or even functional skills like English and Maths.
Last month, the Department for Education launched the £7m “flexi-job apprenticeship” fund, first announced by chancellor Rishi Sunak in the Budget, in sectors where flexible or project-based working are the norm.
The government is inviting sector bodies, groups of employers and other interested organisations to register as flexi-job apprenticeship agencies, giving them access to the fund. Prospective agencies need to be able to demonstrate that they understand the skills needs of their sector or region, and can work towards financial sustainability.
