The Charity Finance Group has called for the apprenticeship levy to be delayed for a year after the UK’s decision to leave the European Union.
The apprenticeship levy will force all employers with payrolls of £3m and over to pay a levy of 0.5 per cent of their overall payroll amount to the government. Each employer will receive £15,000 to offset the cost of implementing this.
Caron Bradshaw, chief executive of the CFG, says in a letter to Nick Boles, the Minister of State for Skills, that delaying the introduction of the levy until April 2018 "is a reasonable response to the new environment we find ourselves in" after the referendum result and would "limit the potential negative impacts" from paying the levy at a time of economic uncertainty.
The letter says the introduction of the levy, which it argues would cost charities £70m a year, is unhelpful at a time when the charity sector is facing an anticipated loss of £200m in EU funding.
The levy is due to start on 1 April 2017, and initial guidance was released in April this year.
But further guidance that was originally slated for release in June has been delayed, and the policy has attracted significant criticism from across the charity sector and beyond, including from the CFG.
"The sector now needs clarity on the direction of the levy and adequate time to prepare," says Bradshaw’s letter. "With less than a year until its introduction, we are still in the dark as to who can provide apprenticeship training and what processes organisations need to go through to become registered providers.
"Without this logistical information, charities cannot proceed to develop apprenticeship standards and the accompanying training that the sector currently lacks, or support providers to do so.
"Delaying the introduction of the levy by a year will give the sector the necessary time to make these preparations and ensure that the levy genuinely improves skills."
Asked whether the levy would go ahead, a spokeswoman for the Department for Business, Innovation and Skills said: "Our focus is on ensuring the levy works for businesses of all sizes as they adapt and seize opportunities in the coming months. We are continuing to work with employers to design the apprenticeship levy around their needs and will shortly be publishing further details."