EC Meeting November 2018

Current Apprenticeship Funding Model

Since 2018 a levy paying employer can transfer up to 10% of the annual value of funds entering their digital account (DAS), to other employers also on the digital system but not directly employed by them.

Employers can use their funding (up to a cap) to cover the costs of an apprentice’s training, including English and Maths, assessment and certification .

It is not possible to use levy funds to cover any costs other than the training and assessment costs.

Overheads, supervision costs and apprentices’ wages must not be funded by the levy.

Levy-paying employers can only use DAS funding to pay for the costs of apprenticeship training and end point assessment and this must be with an approved training provider and assessment organisation. This funding cannot be used for other costs associated with apprentices or wider training effort, e.g. wages, statutory licences to practise, travel and subsidiary costs, managerial costs, traineeships, work placement programmes or the costs of setting up an apprenticeship programme.

Each apprenticeship falls into a funding band. The new apprenticeship funding system has 15 funding bands , with the upper limit of these bands ranging from £1,500 to £27,000.

The upper limit of each funding band caps the maximum amount of digital funds an employer who pays the levy can use towards an individual apprenticeship.

When the employer does not pay the levy or has insufficient digital funds and is eligible for extra support the upper limit of the funding bands also cap the maximum price that government ‘co-invests’ . It is up to employers to negotiate prices with providers, within these funding limits .

Co-Investment

If an employer has not paid the levy and would like to train an apprentice, the government will cover 90% of the training and assessment costs. The employer has to cover the remaining 10% of these costs. If a levy paying employer wants to invest more in apprenticeship training than they hold in their digital account and at any point in time has insufficient funding available in their digital account to meet the full costs of training (up to the funding cap), the government will cover 90% of the costs

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