Apprenticeships Reform 2017
March 3, 2017
From April 2017 the Government is introducing a levy for Apprenticeships. Alongside PAYE contributions, employers with wage bills of more than £3m will now have to pay 0.5% of their wage bill into an electronic account, regardless of whether or not they employ apprentices. The Government will use this to fund the cost of Apprenticeship training and assessment.
For those employers with a wage bill of less than £3m other changes are being brought in, including a requirement that in some cases employers contribute towards the cost of training and assessment.
How exactly are smaller employers affected?
- Smaller employers will have to make a cash contribution towards the cost of training and assessing an apprentice. The Government will pay 90% of the cost with the employer paying 10%
- However, if the employer has less than 50 staff and they recruit a 16-18 year old apprentice, the Government will pay 100% of the cost of the training and assessment
- The Government are simplifying Apprenticeship funding by placing every existing Apprenticeship into one of 15 funding bands, ranging from £1500 to £27000
- This means that employer contributions could be as little as £150 or up to a maximum of £2700, depending on the type and level of the Apprenticeship training
- All employers, regardless of size. will receive a support payment of £1000 for employing a 16- 18 year old apprentice, even where the Government has funded 100% of training and assessment costs
- The training provider that an employer works with will also receive an incentive payment of £1000 from the Government for delivering Apprenticeship training for a 16-18 year old.
- An additional £1000 support payment will be available to an employer and their training provider if they employ a 19-24 year old apprentice who was formerly in the care of the local authority or who has an Education Health Plan.
Now is the time to plan for the recruitment of apprentices to support the long term growth and success of your business.