BUSINESS leaders have stepped up calls to reform the Government's apprenticeship levy after new figures showed a huge fall in the number of apprenticeship starts since it came in.

Between August 2017 and January this year there were 206,100 apprenticeship starts in England compared with 269,600 between the same period a year ago.

The Institute of Directors (IoD) said starts were down 24%, adding to the "growing body of evidence" that the levy was not working as the Government intended.

Head of Policy Research Seamus Nevin, said: "Employers in almost every sector are reporting urgent skills shortages so the majority are very supportive of the levy in principle.

"But there have been major problems with putting the funds to use in the ways and places they are needed most.

"While the intention behind the policy is right, today's stats reinforce why we need a change in how the levy is implemented.

"The IoD has been urging the Government to reform the system so that larger companies can pass more of the funds down their supply chain to the places it is really needed, and to give firms longer to use the money, so that it is spent on the most valuable apprenticeships and on subjects where there are the biggest skills shortages.

A Department for Education spokesman said: "Our reforms to the apprenticeship system are about increasing the number of quality apprenticeships, so people of all ages and backgrounds can take advantage of the opportunities apprenticeships bring.

"We have recently seen an increase in the number of people starting on higher level apprenticeships, such as engineering and law, and on our new quality apprenticeship standards.

"These new apprenticeships are designed by employers themselves to meet their needs, and in a range of industries such as fashion, banking and defence.

"The apprenticeship levy is an important part of these changes to raise the quality of apprenticeships in this country, creating long-term, sustainable investment in training and education.

"Nearly 60% of people starting on the new apprenticeship standards are levy supported, showing that levy payers are working well with the new system."