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Government to confirm further detail on apprenticeship levy this week

The Department for Education (DfE) has confirmed to AM it will release more detailed information about its apprenticeship levy on August 12.

The automotive industry has been calling for a delay to the planned launch date of April 2017 due to lack of clarity on how the levy will be implemented.

A spokeswoman for the DfE would not comment when asked if the levy will be delayed but said more information will be announced at the end of the week.

The announcement on Friday is expected to confirm if there will be a delay and more detail on the proposed maximum funding levels for apprenticeships under the scheme.

The levy – a tax on all businesses with payroll costs of £3 million or more a year – was the brainchild of former Chancellor George Osborne and was intended to raise the £3 billion a year needed to fund his aims of creating three million new apprenticeship roles by 2020.

The levy will be calculated at 0.5% of a business’s annual payroll bill, minus an allowance of £15,000.  Given the average AM100 staff cost was £32.2 million (2014), the average AM100 dealer group’s annual apprenticeship levy would be £146,000. However, for the biggest groups, the cost could be almost £1.5m.

More detailed information on the levy was due to be revealed in June, but the publication date was pushed following UK’s vote for Brexit.

Following the Government reshuffle that took place under new Prime Minister Theresa May, responsibility for apprenticeships was moved from the Department for Business, Innovations and Skills (BIS) to DfE.

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