The Apprenticeship Levy: Employers, are you ready to take control?
By Helen Johnson (21/02/17)
In just over two months, employers will be ‘in control’ of apprenticeships – a well used phrase, but what does it mean?
Since Autumn 2016 we have been reading draft rules and guidance from the Skills Funding Agency and this is all we’ve had to go on to plan usage of the Apprenticeship Levy. Early in February 2017 the ‘final’ document (Apprenticeship funding: rules and guidance for employers May 2017 to March 2018 version 1) was published with some changes.
The first thing to understand is that once the levy is taken from the employer, via the HMRC, it is no longer the employer’s money. It becomes public money but the employer can access it to fund training for their employees who undertake a ‘statutory apprenticeship as set out in the Enterprise Act 2016’.
The ‘approved’ apprenticeships (frameworks and standards) will appear on the Apprenticeship Service (previously known as the Digital Apprenticeship Service or DAS) and I believe this will help to reduce confusion over what is and what isn’t an apprenticeship.
Approved training providers will also be on the Apprenticeship Service, and so only those that have been through the government’s procurement process (a financial check and due diligence) can receive Levy funds for apprenticeship starts from 1 May 2017.
The apprentice assessment organisation also needs to be chosen at the start of the apprenticeship and recorded in the Apprenticeship Service. The Apprenticeship Service should make choosing an appropriate provider and suitable apprenticeship easier. If it is not an option on the portal, then the Levy funds can’t pay for them!
Negotiation between employer and training provider is important before the apprentice even starts the programme. What is and isn’t included in the cost, will there be additional costs for exams etc. Be careful as even if the qualification is cited in the apprenticeship standard, there may be an additional cost! And with regard to end point assessment; what happens if the apprentice fails this, how will the training provider mitigate against this, what does the EPA cost cover?
And don’t forget that at least 20% of the apprenticeship (the hours the apprentice is employed) has to be off-the-job training. Maths and English are not included in this 20% and so employers cannot ask the apprentice to complete these in their own time.
The Apprenticeship Levy and reforms may well put employers in control, but the process is still a complex one with many aspects to consider.
For large, and some medium employers this is not a responsibility to be ‘bolted on’ to someone’s day job, but requires staff with specialist knowledge to ensure each area is covered and that the final funding rules and guidance are fully understood.
After all, every Levy paying employer will be signing a contract with the Skills Funding Agency to use their Levy funds, and the SFA reserve the right to clawback for any breaches.
Key points to remember:
- Understand the ‘final’ funding rules and guidance
- Levy funds can only be used for frameworks/Standards and training providers that appear on the Apprenticeship Service
- Negotiation and relationship building is key between employers and training providers
- Carefully plan and record the 20% off-the-job requirement for every apprenticeship
- Understand the contract between the Skills Funding Agency and employers
Helen Johnson has over 10 years experience in Education and Skills in public and private sector. Esat Smyth Consulting takes great care and ownership of clients’ and stakeholder needs. They will assist any employer gather the requirements to find the best solution and provider, in order to fund and deliver according to training and development plans; “Evolving Futures”.
For further information email Esat Smyth Consulting on: firstname.lastname@example.org