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Changes to Apprenticeship Funding

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From April 2017 a new charge will apply to some employers – the Apprenticeship Levy. Although many employers will not pay the Levy, there will be significant changes to taxpayer funding of apprenticeships for all employers. The changes are being introduced as the government wants to encourage the creation of three million apprenticeships in England by 2020. We appreciate that the Levy payments are unlikely to affect your business, but you may be able to benefit from the apprenticeship funding reforms.

How will this benefit my company?

The funds raised will enable the government to make a greater contribution towards apprenticeship training. Accordingly, for all eligible training you will need to contribute only 10% to the cost and the government will pay the remaining 90%, up to the maximum funding available for that apprenticeship.

What costs will the apprenticeship funding cover?

Funding can be used towards to the costs of the apprenticeship training and the end point assessment. Training must be provided by an approved provider. The funding cannot be used towards other costs relating to your apprentices, for example wages; travel; subsistence or the costs of setting up an apprenticeship programme.

How can I access the government funding?

The National Apprenticeship Service can provide details of approved training providers and assessment organisations. From 2018 the apprenticeship service will be fully online and the service will allow you to organise the training, as well as post apprenticeship vacancies.

What is an apprenticeship?

To qualify as an apprenticeship, the following rules must all be met:

  • The apprenticeship must be employed in a genuine job
  • The employee must be working towards an approved apprenticeship standard or framework
  • The training must last at least 12 months
  • At least 20% of the apprentice’s time must be spent on training. This training should be off-the-job and be directly related to the framework or standard

Any questions relating to apprenticeships should be directed to the National Apprenticeship Service.

Are there any age criteria for the apprenticeships?

There are no age restrictions, as long as the apprenticeships meets all of the above rules. However, there is an additional £1,000 payment made to employers for apprentices who are between 16-18 years of age and 19-24 year olds who were formerly in care or who have an Education and Health Care plan. There may also be additional funding to support those from disadvantaged areas.

What other support is available?

In certain circumstances the government will fully fund apprentices to gain qualifications in Maths and English where they have not previously achieved a GCSE grade A*-C.

If you have any queries regarding the payment of the Levy, please do not hesitate to contact our Payroll Manager, Steve Milne.