24th September 2021
Accessing apprenticeship funding just got easier!
Thinking of employing an apprentice but don’t pay the levy? Well things are about to get a whole lot easier.
It’s all well and good the government encouraging businesses to rejuvenate the UK workforce by recruiting apprentices but accessing funding can be a daunting task, even for those “in the know”.
Only this week I was asked by the owner of a new start-up business, keen to take on a new employee and develop their skills, knowledge and behaviours through an apprenticeship, how much does it cost and how can they access funding? And that was a question from someone who has a wealth of payroll knowledge and knows all about the apprenticeship levy. But knowing how the levy works and knowing how to access funding are two very different things.
So, I welcome the new government service which will make it easier for large businesses to pledge funds to smaller businesses to help them recruit more apprentices.
For quite a while now, large employers have been able to transfer up to 25% of their annual levy pot to help other employers to take on apprentices.
But later this month there will be a new page on GOV.UK which will allow levy paying employers to advertise their funding pledges, enabling a much wider range of businesses to browse and apply for available funds. Levy employers can advertise available funds for transfer, with the option of specifying the types of apprenticeships they wish to fund, such as location and sector. The employer will create their transfer pledge through their apprenticeship service account, and this will be advertised publicly on the new GOV.UK page.
It will mean levy funds can be used more easily to support apprenticeships in both larger companies and in smaller businesses in their sectors or regions. It will also mean businesses will be able to choose to target their pledges towards sectors and communities they want to support.
The business receiving the transfer of funds will need an apprenticeship service account to receive a transfer of levy funds, and they will be bound by the apprenticeship funding rules for how they use the transfer funds and how they employ their apprentice.
Is there a catch?
This all sounds a really positive step forward, and indeed it is. But there are a couple of things employers need to bear in mind when using this service. Firstly, the transferring employer must be aware that a transfer of levy funds is not a one-off payment. By agreeing to transfer levy funds to another business, a large employer is committing to pay for a specific apprenticeship for the length of of its duration until the apprenticeship has been completed.
And the receiving employer needs to understand that the levy funds can only be used to pay for the cost of the apprenticeship training and assessment until completion. They can not be used for any other aspect of the apprenticeship such as the apprentice’s wages or their employment. This remains the responsibility of the business receiving the transfer funding.
You can find out more about transferring the apprenticeship levy to another business on GOV.UK.
Here at MBKB Training we offer a wide range of apprenticeships, and our friendly and knowledgeable team are able to help you source funding if you are a non-levy paying business. Contact us at email@example.com to find out how we can help you.