Logistics UK: Apprenticeship system failing

ACCORDING TO Logistics UK’s Skills Review, there is great interest across industry to take on apprentices however, over the past five years, only 4% of levy paying employer accounts were able to fully utilise the funds available to them. 

Logistics UK deputy director of policy Michelle Gardner, explains: “Our latest report found that the total estimated amount of funding possible to be recovered by businesses in transport and logistics since the levy was introduced was £250 million: however, during the same period, the sector paid in £825 million in levy funds. This is unacceptable – especially considering the current economic climate – and highlights the urgent need to overhaul the Apprenticeship Levy, especially if industry’s long-term skills shortage is to be resolved.

“With 68% of respondents to Logistics UK’s survey interested in taking on apprentices, it is clear the demand across industry to support growing talent is there, but the current system is fundamentally flawed. Traditionally, there have been many barriers to entry for candidates and businesses, such as minimum skills requirements and minimum duration of the apprenticeship – many of which do not apply to logistics roles – as well as restrictive business size specifications which prevent further uptake of the training scheme. 

“Since 2021, Logistics UK has been highlighting to government the need for the current system to be replaced with a more flexible Training Levy to enable realistic training and development programmes for new recruits. The industry itself is working hard to fill skills gaps and introduce the next generation of workers to the sector – via initiatives such as Generation Logistics – however it is now vital that government responds accordingly to remove the barriers and ensure a continued skilled workforce is available to keep the UK economy supplied with everything it needs.”

To view a copy of the report, visit: www.logistics.org.uk/research-hub/reports/logistics-skills-review

Digging a little deeper, where has the £575m that the sector has overpaid gone to?

Jonas Keat, policy advisor at Logistics UK expands: “Technically, unclaimed levy funds are supposed to go back into the apprenticeship system and used to fund apprentices for SMEs. But our contention is that while the logistics sector paid £825m up to June 2022, only £250m was able to be recovered by the sector for apprenticeships. Therefore, while unused levy funds are in theory used for other apprenticeships, our point is that the sector has lost £575m as part of the whole process, and it is unclear where that remaining funding has been/will be spent.”