CBI Spring Budget submission 2022: key takeaways for skills and employment

The CBI has submitted four major asks:

1. A permanent Investment Deduction to drive productivity growth
2. Challenge UK firms to invest in UK skills
3. Make sure Britain wins in global green markets
4. Seize Brexit opportunities to create future-focused regulation

Here we set out what you need to know about our asks to ensure that the changing workforce can and will deliver for your business.

Challenging UK firms to invest in UK skills

Creating the right environment for business investment in skills is key for the country’s economic recovery and long-term growth. This means funding more apprenticeships and investing in the skills needed for growth. We are calling on Government to:

Turn the existing Apprenticeship Levy into a Skills Challenge Fund

Reforming the Apprenticeship Levy in this way will:

• Allow investment in modular training and not just whole qualifications. Skills gaps will be faster filled if individuals can access more flexible training.
• Complement the delivery of the Government’s Lifelong Loan Entitlement (LLE), which will seek to provide individuals with a loan entitlement to the equivalent of 4 years of post-18 education to use over their lifetime.
• Challenge every business that currently pays the Apprenticeship Levy to increase spending to their whole contribution and beyond by rewarding firms that spend above their Skills Challenge Fund with additional credits to further boost investment in training.

Bring new coherence to skills and immigration policies through an independent Council for Future Skills

Modelled on the Low Pay Commission, the independent Council would review current labour shortages and skills gaps, and make recommendations on how to combine business action, skills policies and immigration to deliver a workforce fit for the 21 century.

Build an agile skills system fit for the post-Brexit economy

Government needs to create the conditions for the education system to move beyond higher education and apprenticeships if we are to close labour shortages and reduce our reliance on immigration. Proper investment in T-Levels, Higher Technical Qualifications and Skills Bootcamps along with the new, more flexible version of the Apprenticeship Levy we are calling for are key to maintaining UK competitiveness on the international stage.

Ensure the success of Local Skills Improvement Plans (LSIPs)

A key part of the Skills and Post-16 Education Bill, the aim is for LSIPs to better align what education providers offer with the needs of local economies. The idea has great potential if it can give a voice to those employers who currently struggle to be heard in every area of the UK as envisaged.

Ensure the Lifetime Skills Guarantee supports training that caters to careers in the jobs most needed

This can be done by easing both access requirements and costs for level 3 and equivalent or lower qualification (ELQ) learning as well as extending existing courses to cover more ground.

Expand Bootcamps to address immediate labour and skills shortages

Bootcamps are already proving their potential to address immediate labour and skills shortages that will help economic recovery. This is especially important in the interim until the Apprenticeship Levy is reformed to allow more agile training.

Initial focus should be on expanding existing courses for HGV drivers, welding, retrofitting and mechanical and electrical engineering and rolling out a new ‘warehouse operative’ Bootcamp to confront delays in supply chains and at ports. Our hope is that in future Skills Bootcamps will complement our proposed Skills Challenge Fund.

Promote workforce inclusion to address skills gaps while reducing our reliance on immigration

A holistic approach to make certain that everyone can develop their skills and access opportunities in the workforce is key to economic recovery. Current skills and immigration systems will need to adapt quickly if we are to fill skills gaps by 2030 as envisaged in the Government’s Levelling Up commitments.

Ensure the continued provision of free mass community testing until the end of 2022

Government should ensure the continued provision of free mass community testing until the end of 2022 to support the UK workforce and maintain employee and consumer confidence to participate in the economy and return to in-person work.

Next step

Read our full submission to HM Treasury here.

Creating the right environment for business investment in skills to combat labour shortages is crucial for the country’s growth and recovery. We will continue to engage with Government up to the delivery of the Spring Statement to ensure that our vision for a thriving economy becomes a reality.

Speak to Victoria to share your views or for any other queries about our skills agenda.