This article has been put together to offer employers guidance about how to access spend apprenticeship levy funds. After the 2015 Budget, the Chancellor announced the apprenticeship levy as a way to reach the target of 3 million apprenticeships by the year 2020. Around 2% of English employers are going to be paying the apprenticeship levy, and many more businesses are going to benefit by receiving funds for training new apprentices in future. Extra help has been promised for employers taking on apprentices aged 16 to 19 and care leavers.
Why is the government introducing the levy?
The government is introducing the apprenticeship levy to help employers to enrich the workforce through training apprentices to the highest standards. At the moment, not enough is being done to help this process. When the levy is introduced there will be more opportunities for businesses and apprentices throughout England.
How can I access my levy funds?
If you pay the apprenticeship levy, you can start off the process by creating a digital account in January. The new digital account will be a portal to funds, training and assessment. Levy funds will be paid as digital vouchers. It is hoped that all employers will use the Digital Apprenticeship Service by 2020.
What are the levy funds for?
Levy funds can only be spent on training and assessment for your apprentices. You can’t use levy funds for any other costs associated with employment. Top up payments of 10% will be made to your digital account with the levy payment each month.
When will apprenticeships be funded?
Apprenticeships started in May next year will be eligible for funding if you pay the apprenticeship levy. Funding will also be available for non levy paying apprentices. More companies will benefit from the new service from 2018. The Digital Apprenticeship Service will give employers the extra help they need with funding issues.
What extra help is available for businesses taking on school and care leavers?
Employers who take on 16 to 18 year olds or young people leaving care, the government has promised extra support to help with employment costs.
Accessing the digital apprenticeship service
You can access the new digital service by setting up an online account. Levy payments from the government go into this account. The new digital apprenticeship service is available next year for companies paying the apprenticeship levy. By 2020, it is hoped that all businesses will arrange and pay for training using the digital apprenticeship service.
What can I do now?
As an employer, you can start to prepare for next year by modelling the financial impact of the apprenticeship levy. Unfortunately, you can’t use levy funds for any existing apprentices in your company. In the meantime, you can read all about the new employer guidance here: https://www.gov.uk/government/publications/apprenticeship-levy-how-it-will-work/
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