Amendments Made to Apprenticeship Levy Plans
Secretary of State for Education, the Rt Hon Justine Greening MP, announced a series of amendments to the forthcoming apprenticeship levy this week, following feedback from across the sector.
In a statement published on the Government website, the Education Secretary said:
“After extensive discussions with employers and training providers we are today publishing the final funding policy for May 2017 onwards and details of the new register of apprenticeship training providers.
“The adjustments we have made to the funding policy since our proposals in August will help ensure that the reforms benefit more employers, providers and apprentices.”
The changes mean that the levy will now include:
- An extra 20% of the funding band limit, on top of the £1000 per employer and provider incentive, to help providers adapt to the new funding model when hiring apprentices aged 16 to 18
- £60m of funding to support disadvantaged areas
- A six month extension on the time employers have to spend funds in their digital account, with unspent funds now expiring after 24 months
- A softening of provider register rules, with many subcontractors not needing to be on the new register “for the time being”
- Higher funding for STEM apprenticeship frameworks
- A commitment to introduce the ability for employers to transfer digital funds to other employers in their supply chain
The confirmation of additional funding for those in deprived areas comes after media in the sector predicated a U-turn following analysis which showed funding in some of the most deprived areas could be cut by as much as 50 per cent.
A Save our Apprenticeships campaign was launched by FE Week last month, garnering support from Shadow Skills Minister Gordon Marsden MP and the Rt Hon David Lammy MP, who has previously served as the Minister for Higher Education, in protest against proposals to drop the current disadvantage uplift fund.
The amendments include a “simplified version” of the current uplift fund, which offers additional funding ranging from £200 to £600 per apprentice, calculated according to the Index of Multiple Deprivation. Providers will receive the maximum amount when hiring apprentices who come from the top 10 per cent of deprived areas.
Further information about apprenticeship funding and the new changes is available here.
The Department for Education also published a series of related documents alongside the main funding guide, including a study by the Institute for Employment Research and IFF Research on how employers will respond to the levy; research by Frontier Economics and CFE Research into the costs of recruiting 16 to 18 year old apprentices; and a series of draft rules and guidance for the first year of the levy.