ARC Reports Progress with Government on Apprenticeship Levy

In November, last year the Association of Recruitment Consultancies (ARC) instructed its lawyers to raise questions to the government about fairness in how the levy is to apply to agencies who supply agency workers.

ARC is now pleased to report that in its reply received in December, HMRC agreed that key officials responsible for the delivery of the levy would meet with ARC representatives to discuss the issues.

Adrian Marlowe, Chairman of ARC, reports

“On 12th January we met with a senior government team, two representatives from HM Treasury, the HMRC lead official and the lead official tasked with ensuring the levy is ready for launch by April 2017. Clearly the government is concerned to ensure that the levy is fit for purpose and wants to address issues that arise. There is an anomaly as it attaches to the payroll of supplied agency workers, so creating a disproportionate consequence, but other sectors are also affected. We used the opportunity to present a plan for a fairer and more efficient Apprenticeship Levy that we have devised with members over the last two months. This builds on the work already done by the government, and the senior officials we met with were keen to hear our proposal.

“This plan, if accepted, would not only allow agencies the benefit of the allowance on their own internal staff payroll entirely independently of the agency worker payroll, but would result in a uniform levy that could be charged on to the hiring client transparently, where the agency feels it appropriate to do so.”

ARC believes that its proposal is innovative and comprehensive.

“The plan is designed to meet all the objectives of the original government consultation and support the government’s initiative, yet protect agencies from being disproportionately affected.” says Marlowe.

“Since the meeting, subsequently described by the government levy lead as ‘helpful’, we are exchanging notes with the levy lead, and shall be reviewing the detail of the proposal in conjunction with the various departments involved. We shall report further on this ongoing dialogue as it evolves.

“It is clear that the government has set itself quite a challenge and is working hard to deliver the levy in its current form with little scope for early change. However, we remain keen to see our proposals adopted at the earliest possible moment since the current position will, amongst other things, prohibit hirers from using the agency worker levy funds they may have contributed to.”