Apprenticeship Levy should be 'retained locally'

24/04/2019
Dominic Browne

The Apprenticeship Levy should be retained locally as part of moves to support 'local productivity deals' between councils and key businesses, a leading think tank has suggested.

A new report from Localis Prosperous Communities, Productive Places suggests local authorities should work with 'local economic anchors' to secure commitments on anything from regular meetings to detailed economic agreements.

These would have a wider social value aspect, helping boost jobs, wages, infrastructure and housing supply to prevent residents being priced out of their own areas through so-called ‘doughnut economies’.

This is where the wages of residents remain far lower than those of the commuters who journey into their areas to work with major local firms.

A local levy?

One part of this would be further devolution of skills funding under the Apprenticeship Levy to help councils work with businesses on local qualifications.

'Where funding is available, local businesses should be able to shape its investment. The recent flexibility for the Apprenticeship Levy to be used in supply chains is welcome, but greater control of source funding to promote, scale supply and deliver skills provision matched to local need should be provided. The potential to develop local qualifications with business should be explored,' the report states.

'Empowerment of strategic authorities to oversee the levy collected within their area would enable oversight of digital accounts, monitoring take-up in key sectors, direction of unutilised levy to fund local apprenticeships and the tailoring of activities linked to LIS [Local Industrial Strategies]. Meanwhile, places must use the powers they have to make the system work for them as best as possible.'

Highways has revealed that billions remains unclaimed by employers as the 24-month rolling deadline on accessing funds approaches.

Local authorities could help co-ordinate a local public sector innovation offer for companies signing up to deals 'providing greater access to data, markets and finance, skills supply chain development and spatial planning'.

There is also a case study of how a local productivity deal might work between West Sussex Council, which commissioned the report, and Gatwick airport.

The report also states: 'Devolution to non-metropolitan areas of spatial planning and skills should be an urgent priority for Government. A step-change is needed in devolution in non-metropolitan areas.'

Gatwick case study

'A productivity and prosperity deal between Gatwick and West Sussex County Council would establish a new way of way of working to support both the economic and social prosperity of the county.

'The aim is balance place and community prosperity with business productivity, realising a 'balanced scorecard' for both business and residential communities.'

West Sussex County Council Economic Growth Plan 2018-2033

Priority objectives are areas for action are defined:

• We will develop a stronger business proposition in a wide zone of opportunity around Gatwick.

• We will work with partners to unlock and enable space for growing businesses around Gatwick and in the north east of the county.

• We will support West Sussex residents to benefit from opportunities arising in and around Gatwick

• We will ensure the town centres are business and visitor ready.

• We will work with partners to secure infrastructure investment to enable business and productivity growth in the north east of the county

Specific measures of success are likely to include:

  • increased business count / business count per 1,000 residents
  • increased proportion of employment in higher value business and professional services
  • higher resident and workplace earnings
  • commercial floor space built every year
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