Calls for overhaul of scheme

Apprenticeship levy ‘not benefiting’ Scottish shops

Prince St retail shopping

Retailers are seeing no benefit from training levy

Scottish retailers say there has been no increase in the number of apprentices working in shops and stores despite paying millions to the government through a new levy.

Retailers paid £15 million in the first year of the levy but received no extra support from the government than in the previous year.

The Flexible Workplace Development Fund, which was meant to provide skills training, was established in such a way as to be of little to no use to retailers of scale, says the Scottish Retail Consortium.

It adds that “there is also little evidence of an increased number of retail modern apprenticeship starts.”

The Scottish Government will receive a further £9m as part of the funding framework for the levy, taking the total funding paid in devolved receipts to £230 million in 2018-19.

Retailers in Scotland are estimated to contribute £12-15m a year towards the levy, but say it is unclear what they get in return, with many viewing it as simply another cost burden.

Even though Scottish retailers began paying the levy in April, they still await details of the mooted £10m flexible fund. That delay is causing uncertainty for retailers, who are consequently being forced to question their own future training provision.

The SRC believes there needs to be a comprehensive overhaul of the scheme to ensure Scottish retailers are not unfairly penalised. 

Ewan MacDonald-Russell, SRC head of policy, said: “Sadly, retailers in Scotland are missing out on the opportunities available elsewhere in the UK to invest in Apprenticeships and training.

“Whilst businesses in England have a transparent account which they can access and direct towards training, equivalent businesses in Scotland are paying what looks more and more like a tax on employing workers.

“Many retailers, as employers of scale, are getting a raw deal. Scottish retailers face a £15 million tax bill this year for the levy with precious little in return.

“It doesn’t have to be this way. With extra funding coming to the devolved administrations in April, there is an opportunity to reimagine the £10 million Flexible Workforce Development Fund and the modern apprenticeship retail framework to ensure they meet the needs of employers.”


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