On 18 March, the Prime Minister announced a number of reforms to the funding of apprenticeships.  These reforms, underpinned by an additional £60m of funding, aim to enable up to 20,000 more apprenticeships to be provided.

One key change is for smaller businesses who do not pay the Apprenticeship Levy. From 1 April 2024, the Government will fully fund the costs of training an apprentice for these businesses, provided the apprentice is between 16 and 21 years old at the start of the apprenticeship.  Full funding will also be available for apprentices aged between 22 and 24 years old where the employer has fewer than 50 employees and the apprentice has either an Education, Health and Care (EHC) plan from their local authority or is a care leaver.

Prior to these changes, many non-levy paying employers had to ‘co-invest’ and cover part of the costs of apprenticeships themselves.  

Reforms were also announced for those larger businesses who pay the Apprenticeship Levy.  These employers can choose to either spend their levy funds on apprenticeships themselves, or transfer a percentage of them to another employer.  To date, 530 employers have pledged to transfer over £35.39m of levy funds in this way.

Previously, only up to 25% of unused levy funds could be transferred.  However, from 1 April, this increased to 50%.  The Government hopes this will encourage more businesses to transfer more funds.

More information on the funding of apprenticeships, which includes the above changes can be found on GOV.UK.

 

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