Apprenticeships and Traineeships
The changing landscape
The Apprenticeship funding landscape has seen significant changes in light of recent policy announcements, with the introduction of Apprenticeship Standards and the imminent Apprenticeship Levy driving these changes. The Skills Funding Agency has issued 3 guidance documents highlighting the funding eligibility requirements and rules for Apprenticeship Frameworks and Standards in 2016/17:
1. Common Apprenticeship funding rules 2. Apprenticeship Framework funding rules 3. Apprenticeship Standard funding rules
Whilst there are few changes from current requirements, providers should be aware that:
Apprenticeship frameworks require a statement from the provider about employer contributions for state aid (page 4 of doc.2) but not for standards (page 10 of doc.3)
The AGE 16-24 grant can only be used for Apprenticeship Frameworks (page 17 of doc.3)
Providers delivering Apprenticeship Standards must provide employers with an incentive claim form, and retain this form for audit purposes (page 19 of doc.3)
All apprentices, their employers and the provider must hold a copy of a Commitment Statement, setting out how they will support the successful achievement of the Apprenticeship Standard (page 30 of doc.3)
The Apprenticeship Levy
The Government has also issued guidance for employers on how the Apprenticeship Levy will work, including details of who the Levy affects, how much employers will have to pay and what those employers can use their Levy payments on. The guidance also highlights issues that have not been resolved yet, such as what will happen to unused Levy payments; the guidance will be updated by June 2016 to further clarify how the Levy will work. The guidance doesn’t currently cover the proposed additional 10% contribution the Government will make to all digital Apprenticeship accounts that Levy payments are made to. Employers who contribute to the Levy from April 2017 will receive an extra 10% on top of what they pay in each month, which they can spend on “apprenticeship training through their digital account”. Whilst there is no further information at this time, the government will set out further details on the operating model in April and draft funding rates will be published in June.
Further information about Apprenticeship funding can be found in the Adult Education Budget: Changing Context and Arrangements for 2016-17 document, and in the latest Funding Rules for 2016/17.
Funding for non-Apprenticeship Levy payers
Contrary to previous Government statements, the new Apprenticeship funding system is not expected to be rolled out to all employers until 2019. While the introduction of the Levy is on target for 2017/18 with a new digital voucher system, the current funding system will continue for non-Levy payers for up to two more years. From April 2017 large employers who pay the Levy will pay into their digital accounts, and then spend that with training providers on Apprenticeships. Funding for those employers not paying the Levy will continue in the way they currently are, so training providers, colleges and others will get contracts to provide Apprenticeships.
How Apprenticeship Frameworks are funded
Until the reforms to Apprenticeships are fully implemented, Education and Training Providers offering existing Apprenticeship Frameworks continue to be funded by the Skills Funding Agency as before. The framework rate can be found by searching for the main qualification in the Learning Aim Search (LAS) facility, selecting the ‘Funding’ tab and then scrolling down to the Apprenticeships section. 16-18 year old apprentices are funded at the weighted rate shown below, whilst 19+ apprentices will be funded at 50% of the weighted rate below, with the employer expected to contribute the remaining 50% of the cost (unless the employer has over 1000 staff, in which case their expected contribution is 75%). The framework rate will be topped up by adding an area cost uplift and a disadvantage uplift where applicable.
English and maths are funded independently of the Framework. The Skills Funding Agency fully fund 16-18 year old apprentices at a rate of £471 per qualification (Functional Skills, GCSE etc) whilst 19-23 year old apprentices are funded at 50% of the fully funded adult rate of £724, therefore £362 per qualification. A further 20% reduction of this amount is applied to apprentices aged 24 and above. Providers should consult the latest version of the Funding Rules to ensure you are aware of the rules and requirements for drawing down funding for delivering Apprenticeship Frameworks.
How Apprenticeship Standards are funded
In May 2014 the Department for Business, Innovation and Skills announced that a new funding system would be piloted by 8 ‘Trailblazers’ for new starts on employer-led ‘Apprenticeship Standards.’ Once approved by Government, these Standards will run alongside their equivalent Frameworks before eventually replacing them; the intention is that by the start of the 2017/18 academic year Apprenticeship Frameworks will all have been replaced by Apprenticeship Standards, although based on the current pace of Standards being developed and approved this deadline is likely to be pushed back until at least 2018/19.
The new funding system for Trailblazers is explained in detail in the latest version of the Funding Rules for Trailblazer Apprenticeships ; the main changes to funding for Apprenticeship Standards include:
- a Government contribution of £2 for every £1 cash contribution made by the employer, up to the Maximum Government Cap for each standard
- the employer will negotiate the cost of the training with the provider and or the assessment company
- an additional payment will be made on completion of the standard
- an additional payment, made after 3 months, will be made to employers with less than 50 employees.
- an additional payment will be made to employers that employ apprentices aged 16, 17 and 18, with half paid after 3 months and the other half after 12 months
- the funding for English and maths will be paid dire
With the shift of emphasis on Apprenticeship ownership to Employers, the Skills Funding Agency has produced a Funding Guide for Employers , highlighting the funding process and the requirements expected of employers when offering Apprenticeship Standards.
Apprenticeship funding opportunities
Due to the requirement for employers to contribute 50% (and for large employers 75%) of the cost of Apprenticeships, the Government and other organisations have created initiatives to encourage employers to take on apprentices. Foremost amongst these initiatives is the Apprenticeship Grant for Employers 16-24 fund, which provides up to £1500 per apprentice (up to 10 apprentices) for employers who have not taken on an apprentice in the previous 12 months. For some areas the grant is managed locally and the eligibility is different from the criteria mentioned in the documents. Sector-specific funding is also available, such as the Skills for Care Workforce Development Fund which funds employers to deliver the Intermediate , Advanced and Higher Apprenticeships in Adult Social Care.
Organisations across the country provide additional funding to employers to encourage Apprenticeships take-up that can be drawn down alongside Government funding; details of these opportunities are listed on the National Apprenticeship Service website and in our Funding Newsletter each month as they become available.
Traineeships are a Government initiative aimed at improving the skills and employability of young people in England. Introduced in August 2013 for learners aged 16 to 24 (and for young people with Learning Difficulty Assessments up to academic age 25), and funded by both the Department for Education (DfE) and the Skills Funding Agency (SFA), Traineeships are an unofficial pre-Apprenticeship programme for learners who are not yet ready to start an apprenticeship or move into employment, but stand a reasonable chance of being ready within 6 months of engaging in a Traineeship.
A Framework for Delivery 2015/16
for Traineeships, which provides practical information for employers, education & training providers and young people about how the new programme works, and how they can get involved, is available on the Gov.UK website. Further information about funding eligibility, access to funds and evidence requirements for Traineeships can be found in the latest version of the Funding Rules .
The funding rules for Traineeships for learners aged 16-19 are based on the Education Funding Agency’s (EFA) funding methodology. If you deliver to this age group, you should therefore refer to the EFA’s:
funding guidance for young people 2014 to 2015: Funding regulations
funding guidance for young people 2014 to 2015: Funding rates and formula
16-19 Bursary Fund Guide for 2014 to 2015
Which are available on the 16-19 funding guidance page of the Gov.uk website. As such, Traineeships are funded as study programmes on a per-learner basis, usually in one of the smaller part-time bands that the length of the Traineeship they are undertaking falls within. As long as the Traineeship has a programme aim on the ILR, lasts between 6 weeks and 6 months, and reflects the needs of the learner, Providers can use as much of their study programme allocation as they see fit to deliver Traineeships (assuming both they and the learner meet the eligibility requirements).
For learners aged 19-24 funding is based on the SFA ‘matrix’ methodology, with a combined funding rate of £970 available for the work experience and work preparation (which can include qualifications) elements of the Traineeship. For both age groups, an achievement payment totalling 20% of the available funding will be paid if the learner progresses to a successful ‘outcome’ such as continued learning at level 2 or 3, an Apprenticeship or employment.