What is the apprenticeship levy?
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Prime Minister Sir Keir Starmer and Education Secretary Bridget Phillipson have announced the launch of Skills England to bring together what they describe as the fractured skills landscape. It will be established in phases over the next 9 to 12 months.
Skills are seen by the new Government as crucial to economic growth, with a third of productivity improvement over the last two decades explained by improvements to skills levels. However, between 2017 and 2022, skills shortages in the UK doubled to more than half a million, and now account for 36% of job vacancies.
Skills England, whose Interim Chair will be Richard Pennycook, former Chief Executive of the Co-operative Group, will bring together central and local government, businesses, training providers and unions to meet the skills needs of the next decade across all regions.
The intention is for it to provide strategic oversight of the post-16 skills system aligned to the Government’s Industrial Strategy. By working with the Migration Advisory Committee (MAC), Skills England will also help reduce reliance on overseas workers.
Supporting local areas to develop the skilled workforces they need — in particular across construction and healthcare — is fundamental to the Government’s mission to raise growth sustainably, Ms Phillipson said.
“Skills England will jumpstart young people’s careers and galvanise local economies,” she went on. “It will bring businesses together with trade unions, mayors, universities, colleges and training providers to give us a complete picture of skills gaps nationwide, boost growth in all corners of the country and give people the opportunity to get on in life.”
The organisation will identify the training for which the growth and skills levy will be accessible — an important reform, the Government believes, giving businesses more flexibility to spend levy funds on training for the skills they need.
The route for employers to shape skills training is currently offered by the Institute for Apprenticeships and Technical Education (IfATE). Its functions will transfer to Skills England, as part of the new organisation’s broader remit.
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