The apprenticeship levy is draining Northern Ireland of training resources and opportunities for young people and needs to be reformed, Unite has warned.
Issuing the warning during National Apprenticeship week, Unite said Northern Ireland must return to an employment-led, partnership approach to skills because of the way the levy interacts with the country’s devolved administration.
Unite regional secretary for Ireland Jackie Pollock said, “(The apprenticeship levy) has acted as a double-tax on those employers who already provided apprenticeships and has actually resulted in them cutting back on these programmes.
“Unite has sought to challenge this trend, with some success, but we desperately need to move back to an employment-led approach to skills.”
Firms pay 0.5 per cent of their total wage bill if it exceeds £3m into the apprenticeship levy, which was introduced in 2017.
While resources from the levy are supposed to be available to all employers, including smaller firms who do not pay into it, many companies in Northern Ireland do not receive anything.
“The way that it works here is that the money comes back as part of our Barnet Consequential as part of our (devolution arrangements). HMRC collect the money but don’t have any route to direct it back to employers,” explained Stephen Kelly, chief executive of the Manufacturing Northern Ireland campaign organisation, which works with Unite.
“It comes back in a block grant and is basically sucked up by government departments to fund their own services. So we have taxation without participation – it’s infuriating.
“Firms have scaled back not just apprenticeships but their entire training and development budgets. We need that money to be returned to businesses so they can invest in skills and development.”
Unite’s Jackie Pollock also pointed out that not only are there fewer apprenticeships but that increasingly the training provided to young people in Northern Ireland is dictated by the priorities of training providers rather than the real needs of industry.
“The result is a growing disconnect and a concerning skills-gap. Until the last decade, Northern Ireland retained employer-led training partnerships, which included trade union representatives, but unfortunately funding for these has been cut – breaking the connection between trainee and available job opportunities,” said Pollock.
“Sadly today many young workers are not even told about the role of a union in protecting themselves and their trade rates, let alone encouraged to join one by their training provider. The result is widespread exploitation of young people during their period of training and the normalisation of short-term and low pay contracts when they finish.”
Pollock added that Unite is fighting for a manufacturing strategy for Northern Ireland that includes a return to employer-led partnerships to provide quality, workplace-based apprenticeships that guarantee trainees decent pay and conditions from day one and the expectation of a permanent job at the end.