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TRAINING LEVIES:
LESSONS FROM GLOBAL
EXPERIENCE
Cebu, Philippines, 11 October 2016
Elizabeth Fordham, Senior Advisor for Global Relations,
OECD
ASEAN countries face significant skills
shortages and mismatches
Public and private investment in skills
development is inadequate
Levies are increasingly common in OECD
and emerging economies
Why are we talking about levies?
Revenue raising: usually supports initial
vocational education
Disbursement: usually supports training
of existing employees
Levy-grant: flexibility to target priority
sectors, population groups
What are levies: towards a typology
Increase funds available for training
Encourage enterprises to invest more in
training
Strengthen employer engagement and
collaboration among stakeholders
Target training to population groups most
in need
Align funds with economic priorities
Potential benefits of levies
Generates heavy bureaucracy to manage /
access funds
Funds training that would have taken
place anyway
Distorts training priorities
Alienates employers
Benefits companies and individuals
unequally
Potential drawbacks of levies
Country Did country
respond to the
questionnaire?
Does the country
have a levy
system?
If not, are they
considering a
levy system?
1 Brunei No - -
2 Cambodia Yes No Yes
3 Indonesia No - -
4 Lao PDR Yes Yes -
5 Malaysia Yes Yes -
6 Myanmar No - -
7 Philippines Yes No -
8 Singapore Yes Yes -
9 Thailand Yes Yes -
10 Viet Nam No - Yes*
Levies in Southeast Asia
*While Viet Nam did not participate in the questionnaire, the governments is reported to have publically
expressed interest in starting a training levy system (ADB, 2014 and UNESCO, forthcoming).
Engage employers – in design,
governance, delivery (work-based
learning)
Target individuals/employers with
greatest needs – work with SMEs and
connect with informal sector
Minimise unintended consequences –
keep objectives clear
Key considerations for an effective
levy system

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Training levies: lessons from global experience

  • 1. TRAINING LEVIES: LESSONS FROM GLOBAL EXPERIENCE Cebu, Philippines, 11 October 2016 Elizabeth Fordham, Senior Advisor for Global Relations, OECD
  • 2. ASEAN countries face significant skills shortages and mismatches Public and private investment in skills development is inadequate Levies are increasingly common in OECD and emerging economies Why are we talking about levies?
  • 3. Revenue raising: usually supports initial vocational education Disbursement: usually supports training of existing employees Levy-grant: flexibility to target priority sectors, population groups What are levies: towards a typology
  • 4. Increase funds available for training Encourage enterprises to invest more in training Strengthen employer engagement and collaboration among stakeholders Target training to population groups most in need Align funds with economic priorities Potential benefits of levies
  • 5. Generates heavy bureaucracy to manage / access funds Funds training that would have taken place anyway Distorts training priorities Alienates employers Benefits companies and individuals unequally Potential drawbacks of levies
  • 6. Country Did country respond to the questionnaire? Does the country have a levy system? If not, are they considering a levy system? 1 Brunei No - - 2 Cambodia Yes No Yes 3 Indonesia No - - 4 Lao PDR Yes Yes - 5 Malaysia Yes Yes - 6 Myanmar No - - 7 Philippines Yes No - 8 Singapore Yes Yes - 9 Thailand Yes Yes - 10 Viet Nam No - Yes* Levies in Southeast Asia *While Viet Nam did not participate in the questionnaire, the governments is reported to have publically expressed interest in starting a training levy system (ADB, 2014 and UNESCO, forthcoming).
  • 7. Engage employers – in design, governance, delivery (work-based learning) Target individuals/employers with greatest needs – work with SMEs and connect with informal sector Minimise unintended consequences – keep objectives clear Key considerations for an effective levy system