Below are the answers to some frequently asked questions we receive about Degree Apprenticeships and the Government Apprenticeships Levy. If you can't find an answer to your question below please contact us and we can help further.
The UK Government is introducing the Apprenticeship Levy in April 2017 to fund a step change in apprenticeship numbers and quality – delivering on the commitment that there will be 3 million apprenticeship starts by 2020. The Levy will put apprenticeship funding on a sustainable footing and improve the technical and professional skills of the workforce (an important component of productivity).
The Levy is 0.5% of employers pay bill collected monthly via PAYE. All employers will have an allowance of £15,000, which means that the Levy is applicable on pay bill over the first £3,000,000.
The money will be collected by HMRC. Individual employers’ funding will then be made available to them via a new digital account, through which employers will be able to pay for training for apprentices. In England, employers will be able to direct funding towards the apprenticeship training they want through a new Digital Apprenticeship Service (DAS). The Service will also support employers to identify and pay a provider, choose an apprenticeship training course, find a candidate and choose a training provider.
Employers will be free to spend their money on apprenticeships training which they judge best meets their needs.
Anglia Ruskin University's Degree Apprenticeships are included as part of the training courses available and provide an excellent way to allocate funding to gain the best possible return.
Employers with a pay bill of less than £3m will not have to pay the Levy. This is more than 98% of all employers. These employers will continue to have access to government funding to support apprenticeships. All employers will have access to the Digital Apprenticeship Service whether they have paid the Levy or not and will be able to use it to manage the Government funding available to them to pay for apprenticeship training.
Levy funds will expire after 18 months if they are not spent on apprentice training. If an employer does not spend their entire Levy on training then the unspent portion will be made available to other employers who are investing in apprenticeship training, so there is an incentive for employers to use their Levy fund.
Employers will not be able to spend an unlimited amount of money on a single apprentice. Funding caps will be set which limit the amount of Levy funds an employer can spend on training for an individual apprentice. The cap will vary according to the level and type of apprenticeship (for example, more expensive, higher quality training is likely to have a higher cap).
There are two circumstances where employers are likely to have to contribute additional funds:
i) where the cost of the training they wish to buy is greater than the funding cap for a particular standard or framework and;
ii) where an employer has spent all of their Levy contribution and all of their top-up and wishes to spend more on additional apprenticeship training.
Apprenticeships offer transferrable, valuable skills which are beneficial to both the apprentice and the employer. If you currently offer in house training please speak to us about how you could accredit your existing programme.
If an apprenticeship isn't currently available for your sector please speak to us to explore developing one.
Keep up to date one the levy through the Government website. Further information will be released on October and December 2016.
The above information is based on Million+ FAQs and Government guidance on the Apprenticeship Levy. Information is correct as of 12/08/16 and is subject to change.