M&S CEO Stuart Machin and Tesco CEO Ken Murphy have called on the government to reform the Apprenticeship Levy fund.
In his monthy newsletter, Machin claimed the Levy was a “tax on opportunity”, stopping the retailer from giving more young people an apprenticeship, according to reporting by The Grocer.
“In theory we should be able to claim the money back for each apprentice we take on, but overly restrictive, bureaucratic rules mean it’s really difficult to access the funds.”
More than £600 million was handed to the Treasury in 2022 from employers that could have funded over 60,000 apprenticeships.
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Machin said the Levy costs M&S £5.4m each year, with the business losing around £365,000 every month in unspent funds.
He added that it is “in desperate need of reform,” asking the government to “expand the scope of the Apprenticeship Levy into a broader skills fund, allowing businesses like ours to bring more people into work, build skills and careers, and help level up the UK.”
Tesco CEO Ken Murphy has also called for urgent reform, claiming the current fund to be “inflexible” and “needing work.”
He said that it “puts entry level apprenticeships at a disadvantage over those who are already in management positions”.
Murphy added that the supermarket giant has only been able to make use of 14% of the £100m it has put into the fund since it was launched in 2017.
Last week during National Apprenticeship Week, retail trade unions including UK Hospitality, TechUK, the Recruitment & Employment Confederation and the British Retail Consortium (BRC) signed a letter urging the government for urgent reform if it wants to unlock economic growth.
BRC CEO, Helen Dickinson said the current system is “holding back” employers from investing funds more flexibly.
She said: “Retailers want to invest more in training a higher-skilled, more productive and better-paid workforce. They want to create more opportunities for people up and down the country.”
“Without reforms to the levy, retail will not be able to turbo-boost equipping its workforce for the future.”
