From May 2017, the way we fund apprenticeships in England will simplify some of the complex arrangements that currently exist. This will make it easier for employers of all sizes to navigate and choose the apprenticeship training they want to purchase. Funding will follow employer choice, moving away from the current provider-led model and meaning providers will have to be much more responsive to what employers need.
Employers who pay the levy will be able to access a new digital apprenticeship service that allows them to spend available funds on apprenticeship training. The vast majority of employers will not be eligible to pay the levy and these employers will continue to benefit from generous government support to pay for apprenticeship training.

All new apprenticeship standards will be designed by employers, around singular occupations, and will include:

• End point assessment
• A holistic element to end-point assessment
• Grading where possible
• Assessment that covers theoretical and practical elements
• No formal requirement for qualifications
• ‘Mastery mechanism’ – with a single approach to assessment against the standard English and Maths – ambition for GCSEs although Functional Skills is still ‘appropriate’
• Minimum 12 months duration
• Minimum 20% off-the-job training
• Use of technology in design, delivery and assessment

In short the funding proposals mean:

• Employers who are too small to pay the apprenticeship levy will have 90% of the cost of apprenticeship training paid by government.
• Government will pay an additional £2,000 for 16-18-year-olds, young care leavers and young people with an education, health and care (EHC) plan. £1,000 will go to employers and £1,000 will go to training providers.
• Employers with fewer than 50 employees will not have to pay anything towards the cost of training a 16-18-year-old, young care leaver or young person with an EHC plan. 
• Government will pay training providers £471 to deliver English and maths qualifications as they do now when an individual is working towards an apprenticeship standard. This will come direct from the government and will not be deducted from an employer’s digital account. 
• There will be 15 funding bands, with the upper limit of these bands ranging from £1,500 to £27,000. All existing and new apprenticeship frameworks and standards will be placed within one of these funding bands.
• Each individual framework pathway will be allocated to a single funding band, regardless of the age of the learner, or geographic location. This will bring frameworks into line with the funding system for apprenticeship standards.  Individual framework pathways will be allocated to the nearest funding band based on the current rate of funding the government pays providers for training adult apprentices but for all STEM framework pathways the current government-funded adult rate will be increased by 40% for level 2 and 80% for level 3 and above, and then allocated to the nearest funding band. 
• Employers will be able to use the funds in their digital account, and be co-funded at 90% by government, to pay for training apprentices whose main place of work is in England whether they live in England or other parts of the UK. 
• Employers will be able to use levy funds to retrain workers in new skills, even if they have prior qualifications, as long as the apprenticeship is significantly different from their previous qualifications. 
• From 2018 levy-paying employers will be able to transfer up to 10% of the annual value of funds entering their digital accounts to other employers on the digital system. 
• Levy paying employers who use up their levy will have 90% of the cost of apprenticeship training paid by government for any additional apprenticeships.  More organisations will be able to offer apprenticeships with the opening of the new Register of Apprenticeship Training Providers.

If you would like to read more detailed information on the apprenticeship reform 2017 please click on the link below or call us on 01752 218086 with any questions.