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The challenges of skills shortages in the UK’s food supply chain are well-known. It is less well understood that these shortages also compound the problem of food waste by creating bottlenecks and stoppages in the supply chain.50,51,52 

Businesses are losing out on £1.1 billion a year of unspent Apprenticeship Levy funds – money that companies are often unable to use because of inflexible apprenticeship rules.53

Changes to the Apprenticeship Levy could not only help fill these gaps, but would offer more people the support and training needed to get started in the workplace.

We propose that the Government could expand the scheme by:

  • Allowing businesses to use Levy funds to cover apprentices’ wages, or to backfill their roles while apprentices are away on off-site training. Inability to use the Levy to cover these costs poses a barrier when it comes to involving charities like FareShare in apprenticeship schemes. Despite businesses being willing to forge such partnerships, charities are prevented from offering placements without incurring additional costs. This change is backed by the British Retail Consortium and the public services union UNISON. 54,55 
  • Enabling Levy funds to be used for training schemes that cover a wider range of skill levels. This should include high quality pre-employment courses for people who are not yet ready to take on a full apprenticeship, offering them a foot in the door.
  • Including apprenticeships with shorter training periods as part of the scheme, recognising the diverse nature of potential roles. As an example, the HGV industry has a driver shortage of thousands, but the 8-10 week training period limits companies’ ability to use apprenticeship funds to fill those gaps. 56,57

Updating the Apprenticeship Levy would not only prevent funds from being lost but would mean more opportunities for people to get into skilled employment. For example, the British Retail Consortium estimates that its members could have offered 12,000 more apprenticeships in 2023 alone under a reformed scheme.60

This change would also provide added social value for the surplus food redistribution sector. Each additional apprenticeship role provides nearly 1,500 hours of support a year to frontline operations at organisations like FareShare.61 And crucially, by plugging skills gaps across the food supply chain, apprenticeship schemes could play an important role in reducing food waste.

Examples from Employability at FareShare

At FareShare, our employability programmes have shown that shorter, flexible schemes can be hugely successful at helping people into work and plugging skills gaps in areas of high need. With over 50 different employability programmes across 18 locations, FareShare and its partners support over 1,00058  people across the FareShare network every year. The projects are tailored to support the needs of each local community. For example, the New Horizons programme at FareShare Merseyside supports a wide range of people through accredited learning, 1-2-1 coaching, wellbeing support and practical on-site work experience. This approach has enabled over 60% of participants to move on into secure employment or formal education.59

The adaptability of our schemes is crucial to reaching people who have not yet found success in traditional routes to employment. Our work has shown the potential that can be unlocked with greater flexibility, an approach that our suggested changes to the Apprenticeship Levy would build on.

What would it cost?

This proposal would be cost-neutral: between May 2019 and March 2022 an estimated £3.3 billion that businesses had paid into the Apprenticeship Levy scheme went unspent due to the current system’s inflexibility.62 Reform would simply allow businesses to put these funds to the use for the purposes for which they were intended. 

References

50

NFU (2022), Press release: Millions of pounds of fruit and veg wasted due to workforce shortages. Available at: https://www.nfuonline.com/media-centre/releases/millions-of-pounds-of-fruit-and-veg-wasted-due-to-workforce-shortages/

51

Smulian, M. (2021) Driver shortage threatens food waste mountain. Materials Recycling World. Available at: https://www.mrw.co.uk/news/driver-shortage-threatens-food-waste-mountain-29-06-2021/

52

Food Standards Agency (2023) Impact of labour shortage: risks on UK food availability and safety. Available at: https://www.food.gov.uk/research/impact-of-labour-shortage-risks-on-uk-food-availability-and-safety

53

IPPR (2022) Press release: Over £3 billion in unspent apprenticeship levy lost to Treasury ‘black hole’, new data reveal. Available at: https://www.ippr.org/media-office/over-3-billion-in-unspent-apprenticeship-levy-lost-to-treasury-black-hole-new-data-reveal

54

British Retail Consortium (2023) Press release: 12,000 Lost Apprenticeships. Available at: https://brc.org.uk/news/corporate-affairs/12-000-lost-apprenticeships/

55

UNISON (2019) Press release: Apprenticeship restrictions mean hundreds of millions of pounds of NHS funds going to waste, says UNISON. Available at: https://www.unison.org.uk/news/press-release/2019/10/apprenticeship-restrictions-mean-hundreds-millions-pounds-nhs-funds-going-waste-says-unison/

56

Logistics UK (2023) Logistics Skills Review 2023. Available at: https://logistics.org.uk/research-hub/reports/logistics-skills-review

57

Seo, Y. (2022) The UK’s apprenticeship system must serve our diverse labour market. HR Magazine. Available at: https://www.hrmagazine.co.uk/content/comment/the-uks-apprenticeship-system-must-serve-our-diverse-labour-market

58

Figure taken from a survey of projects across the FareShare Network in 2022/2023.

59

Figure taken from FareShare New Horizon’s project data for 2023. 

60

British Retail Consortium (2023) Press release: 12,000 Lost Apprenticeships. Available at: https://brc.org.uk/news/corporate-affairs/12-000-lost-apprenticeships/

61

Estimate based on average weekly working hours for warehouse staff, minus 20% for off the job training.

62

Institute for Public Policy Research (2022) Over £3 billion in unspent apprenticeship levy lost to Treasury ‘black hole’ new data reveal. Available at: https://www.ippr.org/media-office/over-3-billion-in-unspent-apprenticeship-levy-lost-to-treasury-black-hole-new-data-reveal

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