The apprenticeship levy could cause significant job losses according to the head of business lobby group the Confederation of British Industry (CBI).
In an interview with the Sunday Times, Carolyn Fairburn said the government’s 0.5 per cent levy on businesses’ payrolls may force bosses to cut costs by laying off employees.
The levy will be put in place to raise £3bn, which will fund three million new apprenticeship positions.
It comes into force at the start of the new financial year in 2017 on all businesses with a wage bill in excess of £3m.
‘Inevitable’ job losses
Fairbairn told the Sunday Times that job losses are “inevitable” if the levy is imposed and said: “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.”
A government spokesperson told the BBC: “The new levy will mean that businesses and the public sector invest in the skills and training they need.”