Northern Ireland

NI employers feel effects of apprenticeship levy

Money Image copyright Getty Images
Image caption Both public and private sector employers will be affected by the apprenticeship levy

Northern Ireland employers are facing a new cost as the apprenticeship levy comes into force today across the UK.

It is effectively a 0.5% tax on businesses with a wage bill of more then £3m.

Both public and private sector employers will be affected including manufacturers, government departments, education authorities and health trusts.

It is unclear what benefit this will bring to businesses or the executive.

In England, when an employer pays the levy they get vouchers to spend on apprenticeships.

That is not the case in Northern Ireland, as the matter is devolved.

Image caption Aodhan Connolly, from the NI Retail Consortium, said businesses in NI risk feeling short-changed by the levy

As there is no economy minister at the moment, no decision has been made as to how this money will be spent.

Aodhán Connolly, director of Northern Ireland Retail Consortium, said: "Businesses in Northern Ireland risk feeling short-changed as the first bill arrives.

"Whilst businesses in England have a transparent account which they can access and direct towards training, equivalent businesses in Northern Ireland are paying what appears to be little more than just another employment tax."

Last year, the former economy and finance ministers, Simon Hamilton and Máirtín Ó Muilleoir, said the introduction of the levy was "bad news for Northern Ireland public and private sector organisations with a pay bill of over £3m".

They added: "There is no overall increase to the executive's budget."

While there is no exact figure as to how many organisations will be affected in Northern Ireland, HMRC estimates about 500 private sector companies and 50 public sector bodies could be impacted locally.

The Department of the Economy opened a consultation on the levy last December and received 86 responses that they say they are in the process of analysing it.

Related Topics

More on this story