23 November 2016

Changes to funding for apprenticeships

New funding for apprenticeships comes into effect from 1 May 2017. New rates have been published for all frameworks and standards (trailblazer programmes are referred to as standards and existing programmes are referred to as frameworks). 

These are:

• Apprenticeship frameworks: funding bands from May 2017
• Apprenticeship standards: funding bands from May 2017

Apprenticeship Levy paying employers will fund apprenticeship programmes through their digital account. They will be able to decide the framework or standard, select their provider and the end point assessment organisation (if they have selected a standard). The employer will agree a price with both the training provider and the end point assessment organisation. The provider will then contract with the chosen end point assessment organisation at the price you have agreed. 80% of the total amount in equal monthly instalments will be deducted from your digital account to pay the provider. The remaining 20% will be deducted once apprentices have completed their apprenticeship programme. If you have insufficient funds in your digital account to pay for all of the apprenticeship training you are undertaking, the provider will need to invoice you for 10% of the outstanding balance (this will be vatable). The Government will then co-fund the remaining 90%.

For non-levy paying employers, the Government will fund 90% of the costs of the chosen framework or standard (up to the maximum band limit) with the employer paying the remaining 10% except in the case where the apprentice is aged 16-18 AND you employ less than 50 employees, the 10% contribution will not be required and the Government will fully fund the apprenticeship programme.

For all employers, the Government has agreed that it will pay an incentive of £1000 for each apprentice aged 16-18. This incentive will be paid to the provider, who will pass the money onto the employer. The Government has also agreed to fund directly to the provider for Functional Skills and English and Maths, where this is a requirement of the apprenticeship programme.

We will be holding a Twitter Q&A on 14 December. Follow the chat @BPIF