One of the leading providers of apprenticeships for construction and utility firms has reacted with concern to news that two thirds of companies are failing to take up the Apprenticeship Levy offer.

Chris Wood, CEO of Develop Training Ltd (DTL), said with a two-year time limit on accessing funding, firms were facing a ticking time bomb after which the money they paid into the levy would be lost to the taxman.

He was responding to a survey by West London College that found only 32 per cent of employers who qualify have used the funding.

Mr Wood said: “At a time when the country is suffering from serious skills shortages, it is worrying that businesses are missing out on an opportunity to train new and existing staff.”

He pointed out that firms with a £3 million pay bill and above are legally required to pay into the levy via the PAYE scheme: “If they do not access funds to train people, they are choosing to be taxed instead.”

Mr Wood highlighted the two-year time limit within which firms have to use their Levy funding.

“There is evidence that employers don’t fully understand the Levy, so while some may have weighed up the pros and cons before making a decision, it’s likely that others will be out of pocket because they didn’t get to grips with it early enough,” said Mr Wood.

“They really need to get help to navigate their way through the options because this is a ticking time bomb.”

DTL already works on Levy-funded apprenticeships with major utility companies including Amey, SGN and South Staffordshire Water.

The firm also specialises in providing consultancy advice to help firms plan their use of the Levy and align that to meeting their training needs.

While DTL welcomed the announcement of the Apprenticeship Levy, it has consistently warned that both the government and the construction, utility and energy sector need to do more to address the sector’s chronic skills gap.

It runs an Industry Skills Forum where senior HR personnel discuss the issues and formulate strategies to jointly solve the problems posed by an ageing workforce and a young generation who don’t envisage a career in construction or the utilities sector.

DTL also supports clients to bring people into the industry by helping them to manage initiatives such as recruitment days.

The company has delivered more than 1,000 apprenticeship programmes. One of these is for dual fuel smart meter installation engineers, a shortage of whom means the government may miss its target for rolling out meters nationwide. Other apprenticeships include gas network team leader, utilities engineering technician, installation electrician and water process technician as well as supervisory and management roles.

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