More than half (53%) of employers who pay the apprenticeship levy want to see it replaced with a training levy, according to new research by the Chartered Institute of Personnel and Development.

The research, which surveyed more than 1,000 employers, also showed that among those already paying the levy, one in five (17%) support the existing system.

Nearly half (46%) of levy-payers will be encouraged to simply re-badge current training activity in order to comply with the new regulations. Among that group, 52% will re-badge existing training activity into level 2 apprenticeships, equivalent to five GCSEs (General Certificate of Secondary Education). Furthermore, a fifth (19%) of levy paying firms, including 35% of SMEs, don’t plan to use the levy at all to develop apprenticeships, but will simply write it off as a tax.

“Apprenticeships are extremely important, but other forms of training are equally valuable and often more flexible and better suited to the needs of organisations,” Lizzie Crowley, skills adviser at the CIPD, said. “A move to a more flexible training levy would have the effect of continuing to prompt greater employer investment in skills, including apprenticeships, but in a way that is much more responsive to employers’ needs.”

The research also found that more than a fifth (22%) of employers still don’t know whether they are paying the apprenticeship levy, and one in eight (13%) who know they will have to pay have still not calculated what the levy will cost them.

 “Another side effect of re-badging is that an increasing proportion of apprenticeships are going to existing and often older employees, including already well-qualified managers, meaning fewer are available to help young people make the transition from education to the workplace – the original purpose of apprenticeships,” Crowley said.

“The Government needs to seriously review the levy to ensure it is flexible enough to respond to employers’ needs and to drive the greater investment in high quality training and workplace skills needed to boost UK productivity,” Crowley said.

Petra Wilton, Director of Strategy, Chartered Management Institute commented on the CIPD research.

“The question of whether the UK has an ‘apprenticeship’ or ‘training’ levy is a distraction from the key issue in this debate: how can the UK overcome its chronic underinvestment in employee training and development? It must be remembered that the Apprenticeship Levy was introduced to force UK businesses to make this investment, and deliver a globally competitive workforce.”

“The Levy is bringing about this much-needed transformation in skills, but it will take time to embed and for all employers to realise its potential. At only eight months in, it is too early to call time on this intervention,” Wilton said.