Seven food retailers and three leading trade bodies are calling for urgent action to reform the “broken” Apprenticeship Levy system and address food supply chain labour shortages.
The British Retail Consortium (BRC), National Farmers Union (NFU) and UKHospitality, alongside supermarkets including Asda, Morrisons, Tesco, Aldi, Lidl, M&S and Sainsbury’s have said reform to the Levy would allow businesses to train up more domestic workers and fill vital skills gaps.
In a letter to the government, the signatories said this would “foster greater resilience, support the nation’s food security, and benefit the economy”.
In recent years, the food supply chain has been hit by acute labour shortages, particularly across areas such as food production and preparation, logistics, warehouse operations, and quality control.
The BRC said that as a result labour costs have risen, which created another inflationary pressure contributing to higher prices for customers.
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The letter said that the current Apprenticeship Levy system is too inflexible, arguing that businesses are required to contribute hundreds of millions of pounds, however funds can only be spent in a “restrictive” way.
Currently, businesses cannot use the money to fund any courses that are shorter than one year in duration.
As a result, the trade bodies and supermarkets are calling on the government to widen the Apprenticeship Levy into a broader Skills Levy.
This would allow businesses to spend their funds on more high quality, accredited courses including shorter, more targeted or more tailored upskilling programmes including safety, hazard analysis, first aid and driving farm machinery.
BRC chief executive Helen Dickinson said: “Why is it that the very system that exists to enable training opportunities, serves as the total opposite? Businesses across the food supply chain have long been calling for reform to the Apprenticeship Levy.
The government should stop dragging its feet so businesses can upskill our workforce, help safeguard food security in the UK, streamline costs and respond to the needs of the economy. The Apprenticeship Levy is nothing more than a tax on business and it must be reformed.”
Tesco chief executive Ken Murphy added: “Reform of the Apprenticeship Levy could not only unlock high-quality jobs in our food supply chains, but also help safeguard Britain’s food security for the future.
“I would urge the government to look again at the practical barriers to skills development under the current system, because it is not delivering for food businesses or their employees.”
