Apprenticeship levy transfers simplified in England
Larger employers can transfer up to 25% of their annual apprenticeship levy pot to support other, smaller, employers to take on apprentices in England. While there is nothing new about this, what is new is an online service where funds can be pledged by larger employers.
Apprenticeship levy funds are lost if not used within 24 months, so transferring surplus funds is obviously more rewarding than losing them.
With the new service, the pledging employer simply uses their apprenticeship service account to create a transfer pledge. This will specify the amount of funds available for the current financial year. They can then choose four optional criteria to reflect priorities for transferring funding. These are:
- Type of job role; and
- Apprenticeship qualification level.
It is entirely up to the pledging company whether to accept or reject an application.
At the time of writing, there were 45 funding pledges listed on the new online service, ranging from £1,618 up to a maximum of £342,263 – some without any criteria.
The benefit for smaller and medium-sized employers receiving a transfer of funds might not be as beneficial as it appears, because, for up to ten new apprenticeship starts each year, the employer only pays for 5% of the apprenticeship fees (and nothing if they have less than 50 employees). However, a transfer will remove the 5% cost, and the full cost if the ten-apprenticeship limit is exceeded.
Although any employer can receive a transfer, they will need to set up an apprenticeship service account.
- The transfer can only be used to cover apprenticeship training costs up to a funding band limit. Transfers cannot be used to cover, for example, wages or travel costs.
- Transfers can only be used for new apprenticeship starts, although this could be an existing employee.
One notable benefit is that funding will run for the full duration of the apprenticeship and cover 100% of relevant costs.
The current list of funding opportunities can be found here.