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Scottish Government challenged over apprenticeship levy spending

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A major construction trade association has warned that the growth in apprenticeships in Scotland could be scuppered unless the Scottish Government ring-fences the new apprenticeship levy for training.

The Federation of Master Builders (FMB) Scotland issued its warning after the Scottish Government announced a further rise in the number of Modern Apprenticeships (MAs) in training north of the Border.

The target of 25,000 MAs this year has been met, and the Scottish Government set next year’s target at 26,000 with the aim of achieving 30,000 MAs in 2020.

Scottish employability minister Jamie Hepburn and Skills Development Scotland chief executive Damien Yeates praised employers for supporting the scheme which they said benefited young people, businesses and the economy.

From April next year all employers in the UK with an annual pay bill over £3 million will have to pay the apprenticeship levy at a rate of 0.5% of their annual pay bill as a commitment to traineeships.

Building firms in Scotland welcomed the rise in MAs but said the progress could unravel unless the Scottish Government commits to re-investing the funds raised by the UK wide Apprenticeship Levy.

Gordon Nelson, director of FMB Scotland, said: “There is now a fear that this good work could soon be undone,

“There is a leadership vacuum in terms of demonstrating how the Apprenticeship Levy will be implemented in Scotland.”

He accepted the apprenticeship levy has been foisted on the Scottish Government with no or very little consultation.

“The business community in Scotland has been particularly frustrated as it was impossible to properly engage with policy-makers on this important matter in the run-up to the Scottish Parliamentary elections,” he stated.

“Now that the elections are behind us and the relevant Ministers are in place, we want a clear message from the Scottish Government that they will engage with the construction industry and others to develop a workable policy for investing the Apprenticeship Levy that works for the Scottish construction sector.”

He said it was crucial that the right action is taken as the Scottish construction industry is in the midst of a skills crisis.

“Nearly half of SME employers are struggling to recruit carpenters, and more than one in three are finding it difficult to source plumbers,” he continued.

“These kinds of shortages could have a potentially disastrous effect on the nation’s key housing and infrastructure objectives.

“The only way to ensure that Scotland keeps building is by developing more home-grown talent, and to achieve this, the construction industry needs the Government to prioritise quality apprenticeships and the upskilling of existing workers.”

Mr Hepburn said: “The FMB is right to say that UK Apprenticeship Levy was introduced without consultation with Scottish Ministers and we have been frustrated at the way this levy has been imposed by the UK Government.

“Despite this, I am very aware that we need to work with the business community to oversee how this policy works in Scotland and ensure we can continue to build on the considerable success of our Modern Apprenticeship programme.

“That process is underway and I would be happy to discuss with the FMB as we move forward.”

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