Energy & Utility Skills comments on the Association of Employment and Learning Providers’ (AELP) position on Department for Education (DfE) guidance that Apprenticeship Levy funded training providers do not qualify for supplier relief measures during the Coronavirus health emergency.
Gillian Keegan MP, Minister for Apprenticeships and Skills, wrote to all English MPs on 17th April 2020 clarifying the position on the Government’s supplier relief measures as described in Cabinet Office Procurement Policy Note 02/20: Supplier relief due to COVID-19:
AELP stated that the Minister’s letter made it clear that the proposed (supplier relief) support would only be available to training providers in respect of Apprenticeships offered by non-Levy paying employers where the training providers hold ‘a direct contract’ with the Education and Skills Funding Agency (ESFA). The letter specifically states that the supplier relief support will not “apply in relation to Apprenticeships funded from employer digital accounts where the contractual relationship is between the employer and the provider”, i.e. in respect of apprenticeships offered by Apprenticeship Levy paying employers.
AELP has moved to seek legal advice on the validity of the DfE’s position; particularly with regard to the fact that the Apprenticeship Levy is tax.
There has been no indication to date that the requirement to pay the Apprenticeship Levy will be suspended or that the period in which the Levy can be recovered and used by Levy payers will be extended. The DfE’s apparent position to exclude from supplier relief those businesses that provide training to Apprenticeship Levy paying employers suggests that such providers are not regarded as supplying a service to the Government and impinges on the question of the validity of the Government continuing to take Apprenticeship Levy payments, as a hypothecated tax, while at the same time not supporting the system by which Apprenticeship Levy payers can recover their payments and invest in their workforce. This risks a DfE policy restriction in the opportunity that Apprenticeship Levy payers have to recover their tax through using the funds in their Apprenticeship Service accounts while at the same time maintaining Treasury requirements for the return of unused funds to the Treasury.
Energy & Utility Skills Chief Executive Nick Ellins, commented:
“The ambiguity and apathy that exists right now around the Westminster government’s appetite to ensure the resilience of the new English apprenticeship market is causing needless damage to confidence and distress to the market. It is also undermining the policy reforms that Ministers initially put in place to instill new levels of quality and have since resulted in apprentices that the employers judge as the best ever. This apprenticeship approach is delivering for many employers, and whilst some change is needed, the talent that emerges is incredible. It is therefore simply common sense that in an ‘employer-led’ policy system, if the ultimate customer and bill payer cannot utilise their money because of an unprecedented global crisis, then their payments in to their account should either be paused or the expiry date of those unusable funds at least extended. To now suggest wasting public money in potential legal disputes over interpretation of technicalities, when the apprenticeship market is at fundamental risk and needs assistance from public money is sad and rather ironic. It is time to focus on achieving a strategic goal that is now very close to Minister’s fingertips, and intervene to end the petty squabbles and protect the market in what is a unique crisis”