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Apprenticeships permit individuals of all ages to earn whereas they study and acquire the talents they should construct a rewarding profession. Since 2010, over 5.3 million apprentices have began their apprenticeship journey in a variety of industries, from well being to enterprise, to engineering and past.
That is partially due to the apprenticeship levy which was created so companies can tackle extra apprentices, alongside the chance to spend money on prime quality coaching to develop the expert workforce they want. Right here, we clarify extra about the way it works.
What’s the levy and the way does it work?
The apprenticeship levy is paid by massive employers with a pay bill of over £3 million. At the moment, solely 2% of employers pay the levy, which is about at a fee of 0.5% of their whole annual pay invoice.
Each employer who pays the levy has a digital account the place they will entry their levy funds to spend on apprenticeship coaching.
Whereas solely the largest companies pay the levy, the funding generated by it additionally funds apprenticeship coaching for different employers who wish to tackle apprentices.
Smaller employers – these with a complete annual pay invoice of lower than £3 million – pay simply 5% of the price of their apprenticeship coaching and the Authorities pays the remaining.
Does all the cash truly get spent?
By way of the general apprenticeships price range, within the final monetary yr 99.6% of the price range was spent.
For particular person employers, they will see how a lot of their levy funds they’ve used and the way a lot stays obtainable. Though funds which they don’t use expire after two years, this cash doesn’t go to waste. Behind the scenes DfE is already utilizing this cash to pay for apprenticeship coaching for smaller employers and for any further funds wanted to assist apprentices, coaching suppliers and employers.
For employers who can’t make full use of their very own levy funds, we’ve arrange a system to allow them to pledge as much as 25% of their levy funds to different smaller companies to assist them to spend money on apprenticeship programmes.
For instance, North Cumbria Built-in Care NHS Basis Belief has helped smaller healthcare organisations develop their very own employees by transferring greater than £122,000 of its levy funds to some 15 organisations, largely GP practices throughout Cumbria.
Jean Hill, workforce improvement lead, mentioned: “Apprenticeships are a part of our attraction package deal – individuals know they will come and work for us, and profit from profession improvement.
“The overwhelming majority of our nursing employees stick with us after finishing their apprenticeship, with a big quantity progressing up the organisation. Apprenticeships assist us fulfil our ‘Develop Your Personal’ technique. Levy transfers are good for us, good for the organisations we switch to and in addition profit the native communities we serve.”
GlaxoSmithKline (GSK) has additionally used its apprenticeship levy to allow a variety of smaller companies and charities to rent and prepare apprentices. One firm to learn from the funding is Yunus & Eliza, a Cotswolds primarily based jewelry firm.
Firm director Eliza Higginbottom mentioned: “The levy switch from GSK has made it doable to supply a possibility for our apprentices and in addition assist us develop our enterprise.
“Our apprentices are implausible. They attend faculty one week a month and when they’re gone, we actually miss them. It takes time and dedication to coach them up on the job, however the time it takes is greater than value it, as a result of they offer us a lot again.”
What can the levy be used for?
Levy funding can solely be used to spend money on prime quality apprenticeships. We wish levy funds for use to assist extra individuals to get on the trail to a rewarding profession and to assist employers to tackle new apprentices.
The apprenticeship levy funds virtually 650 several types of apprenticeships to coach individuals for an enormous number of jobs. Whether or not funds are spent on diploma apprenticeships in engineering, or GCSE-equivalent apprenticeships in social care work, the levy creates flexibility and selection in how employers present apprenticeships.
What can’t the levy be used for?
Levy funds can solely be used to pay for apprentices to attain {qualifications} which are set out of their accredited apprenticeship coaching programme and are deemed essential to being efficient within the job, equivalent to a level or a diploma. Companies massive and small provide apprenticeships in a variety of thrilling roles and in any respect ranges proper as much as diploma stage.
Levy funds can’t be used to pay apprentice wages, for ‘top-up’ {qualifications}, or {qualifications} that aren’t already accredited as a part of the apprenticeship.
For instance, levy funds can’t be used to pay for apprentices who’re on the Degree 7 senior chief apprenticeship to do their Grasp of Enterprise Administration (MBA). MBAs are usually not a compulsory a part of any apprenticeship. Nonetheless, the apprentice or their employer is free to pay further from their very own funds for the MBA qualification.
What are you doing to get extra younger individuals into apprenticeships?
Younger individuals beneath the age of 25 make up greater than half of all apprenticeship begins and 70% of all begins are at Degree 2 and three.
To assist much more companies to supply apprenticeships to younger individuals:
- employers do not need to pay employer national insurance contributions for apprentices aged beneath 25 when the apprentice earns as much as £4,189 / month.
- we pay £1,000 to both employers and training providers after they tackle any apprentice aged beneath 19, or apprentices aged 19-24 who’ve an Schooling, Well being and Care Plan or have been in care.
- we fund 100% of the coaching prices for small employers (fewer than 50 employees) after they tackle apprentices aged beneath 19.
- From August 2023, we’re rising the bursary that we pay to apprentices aged 16-24 who’re care leavers, from £1,000 to £3,000.
To make it simpler for younger individuals to seek out apprenticeships, they are going to quickly be capable of use UCAS to search and apply for apprenticeships, alongside levels. We’re additionally persevering with to advertise apprenticeships in colleges and schools by our Apprenticeship Support & Knowledge programme (ASK) – up to now, over 2 million college students have acquired assist from ASK.
Our ‘Get the Jump’ marketing campaign additionally goals to lift consciousness and understanding of all of the completely different training and coaching pathways open at post-16 and post-18, together with apprenticeships.
Discover out extra:
For extra data on changing into an apprentice, visit this link.
For employers trying to discover out extra in regards to the levy, visit this page.
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