The Labour Party’s manifesto outlines key policies that will be implemented if Labour wins the General Election next month. The manifesto includes a plan to ensure employers have the skills and talent needed to grow their businesses.
Using member intelligence, the CBI continues to outline how different skills policies could impact businesses across the economy.
Areas of impact for businesses
Reforming the Apprenticeship Levy into a Growth and Skills Levy
Labour’s manifesto reaffirms the party’s commitment to reform the Apprenticeship Levy, allowing businesses to fund non-apprenticeship training as well. The exact courses that businesses could invest in will be decided by Skills England, a new national body Labour plans to introduce. Skills England will bring together businesses, training providers, unions, and national and local government to deliver a highly trained workforce aligned with Labour’s Industrial Strategy.
Interestingly, the manifesto did not mention the longstanding position that up to 50% of levy funds can be spent on non-apprenticeship training. This suggests Labour may be undecided on the exact threshold for how much of a levy-payer's funds can be allocated to apprenticeship versus non-apprenticeship training. Consequently, there remains some uncertainty regarding the level of levy flexibility and its implementation timeline. A recent announcement to fund pre-apprenticeship training through the expanded use of the levy also did not appear in the manifesto.
Linking immigration and skills
Labour has pledged to link immigration and skills policy by ensuring that Skills England and the Migration Advisory Committee (MAC) work together. The use of migration to address skills shortages will trigger plans to upskill domestic workers. Labour has committed to introducing workforce and training plans in sectors with high levels of overseas recruitment, such as construction, health and social care. This approach indicates Labour’s willingness to use immigration as a short-term solution while expecting businesses to develop domestic skills in the long term.
Introducing a youth guarantee
To address the rise in young people falling out of education, training and employment, Labour has introduced a youth guarantee. This policy promises that individuals aged 18 to 21 will have access to training, apprenticeships or support to find work. Labour reaffirms its policy to guarantee two weeks of work experience for every young person, and pledges to improve career advice in schools and colleges. The manifesto also includes a commitment to merging Jobcentre Plus and the National Careers Service to make them more responsive to local employers and services.
Deepening devolution
In line with previous messaging, Labour has committed to deepening devolution settlements with existing Combined Authorities, giving local areas the opportunity to gain new powers over adult education and skills.
While this approach could make the already fragmented skills system more resource-intensive for UK-wide businesses to engage with, the issue of complexity for stakeholders, including employers, is acknowledged in the manifesto. Labour plans to address this through a post-16 skills strategy.
For more information on Labour’s skills proposals, please contact Evie Matthews, Senior Policy Advisor.