The long anticipated Apprenticeship Levy update has been announced.
The announcement outlines the rates all employers will have to pay whether they are affected by the Levy or not, including the new funding bands and incentives.
- Employers with a wage bill below £3 million will have to pay towards the cost of an apprenticeship. Those employers are expected to pay a 10% contribution and the government will pay the remaining 90%.
- Levy paying employers (those with annual wage bill over £3 million) will receive a 10% monthly top-up. However, if their levy account is insufficient then like smaller employers, 90% of their additional apprenticeship training costs will be subsidised by government.
Other new announcements within the consultation include:
- A £2,000 incentive to help 16-18 year-olds, young care leavers and young people with an Education and Health Care (EHC) plan.
- Employers with fewer than 50 employees will not have to pay anything towards the cost of training a 16-to 18–year-old apprentice, young care leaver or young person with an EHC plan.
- An online calculator launched by the government. You will need to know your organisation’s annual UK pay bill to view the results. Please click here to use.
- All apprenticeship frameworks and standards starts from April 2017 will be funded from 1 of 15 bands, each with an upper limit ranging from £1,500 to £27,000. It will then be up to employers to negotiate prices with providers. The apprenticeships funding bands tool shows you which funding band an apprenticeship has been allocated to. Click here to view the funding bands tool.
Click here to view the proposals for how the ‘apprenticeships support package for employers in England’ will work from May 2017.
A survey invites employers to comment on the Government’s proposals for funding apprenticeships as published on 12 August 2016. This survey applies to all employers and training providers who operate in the United Kingdom. Skills policy is a devolved matter in Scotland, Wales and Northern Ireland but we welcome views from employers in these nations. The survey will close on Monday, 5 September. Click here to complete the survey.
If you wish to discuss this further, please contact us 020 8891 0992 and we can provide you with advice and guidance to recover your tax, invest in your workforce and grow your workforce in a sustainable way. We are committed to supporting your organisation and look forward to a continued successful partnership!