More details on the new apprenticeship funding system

The latest proposals for the operational model of funding for apprenticeships, both frameworks and standards, which will apply from May 2017, have just been published.

The main proposals, which employers and training providers have been asked to comment on before 5th September, include:

  • The new system will be introduced from 1st May 2017 and apply to all new apprenticeship starts after date

  • All apprenticeships started before 1 May will be funded through to completion according to existing rules

  • The new apprenticeship funding system will be made up of 15 funding bands, each one with an upper limit ranging from £1,500 to £27,000

  • All existing and new frameworks and standards will be placed within one of these funding bands

  • Non-levy paying employers (98% of employers) will be expected to contribute 10% towards the cost of apprenticeship training and assessment, with the government paying the other 90%

  • Levy-paying employers with annual paybills of over £3 million will pay their levy contribution to HMRC through the PAYE process along with tax and NICs, and their digital accounts will be topped up with a 10% contribution from the government