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Published
Dec 21, 2015
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​New apprenticeship levy bound to hit jobs says CBI director

Published
Dec 21, 2015

Britain’s new apprenticeship levy, which will see large employers pay to fund new apprenticeships from April 2017, could lead to significant job losses, said director general of Confederation of British Industry (CBI), Carolyn Fairbairn to the Sunday Times in the weekend.



The new UK-wide levy was presented in Chancellor George Osborne’s Summer Budget, who said the levy will raise £3 billion and fund 3 million apprenticeships. It was also later revealed that the tax will be set at 0.5% of an employer’s pay bill and apply only to payrolls of over £3 million.

According to Osborne, this will mean only 2% of UK employers will have to pay the levy.

However, Carolyn Fairbairn said the levy is one of the most pressing issues facing businesses. Her criticism comes on the back of a survey by the CBI, which revealed that less than half of all businesses plan on expanding their workforce in 2016 because of the new costs.

“There is a gulf in the Government’s understanding of what it is doing here and the impact on sectors like retail and its most vulnerable employees,” said Fairbairn to the Sunday Times.

“Unless there are some changes, it is inevitable there will be significant job losses among workers who would have been paid the national living wage,” she added.

From April 2016, the UK will also see employers raise the wages of employees aged over 25 to a minimum of £7.20 an hour.  

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