As of 2017 the national apprenticeship programme has been be expanded by the introduction of the Apprenticeship Levy.
The aim of the levy is to fund 3 million new apprenticeships by 2020, encouraging businesses to employ apprentices or retrain their existing staff.
Employers who pay the Apprenticeship Levy and provide Apprenticeships are able to allocate their Levy contributions as digital vouchers to use to train their Apprentices. This voucher system only applies for Employers in England.
The Levy was introduced on 6 April 2017. Eligible employers have had to declare their liability to HMRC since May 2017 for levy due on their following months wage bill. Training funds for Levy paying employers has been accessible through the digital apprenticeship service account as of 22nd May 2017.
The cost of an apprentice is spread over the duration of the apprenticeship training. The new system pays training providers one month in arrears for training they deliver. The payments for the training are taken directly from the digital apprenticeship service account monthly. Therefore, the account receives funds monthly as the business contributes towards the Levy and is deducted monthly to cover the training costs of the chosen apprentices.
The price covers the delivery of apprenticeship training towards a specific standard or framework, and the cost of assessing the apprentice. The training costs are taken from your apprenticeship service account and paid directly to us.
Co-investment is intended for employers, who at present are not required to contribute to the Levy, but would still like to take advantage of apprenticeship training. Co-investment means that the government contributes some of the training cost to the training provider. This contribution covers the delivery of apprenticeship training towards a specific standard or framework and the cost of assessing the apprentice. The co-investment rate is set each year, for the proportion of the money that you need to pay and the proportion the government will pay. Co-investment can also be used if you negotiate a price with your training provider that is more than the maximum allowed by the funding band, and then you must pay the difference between the band maximum and the agreed price.
As the Levy was introduced in early 2017 now is the time to start organising your training requirements to take full advantage of the apprenticeship training funds available. We can help you assess your needs and have the correct apprenticeship training available.