From April, the government will change the way Apprenticeships are funded by introducing a new scheme known as the Apprenticeship Levy.
The legislation will require all employers operating in the UK with a pay bill over £3 million each year to make a 0.5% investment of their annual pay bill towards company Apprenticeships.
Any company paying the levy will gain access to a new digital account system which will enable companies to pay for training and assessment for Apprenticeships in England, provided as a voucher system. Resources such as searching for training providers like Just IT to help deliver your Apprenticeship programme will also be available.
How does this benefit SMEs?
The government’s new service will help employers to select and apprenticeship framework – this includes choosing a training provider and assessment organisation as well as a platform to post apprenticeship vacancies.
The Levy presents a number of opportunities for SMEs who can take advantage of the funding available. Some smaller employers won’t have to contribute to the fund, but can still benefit from the online resources available for training staff.
Non-levy paying companies will contribute 10% of the cost of training an apprentice and the government will ‘co-invest’ by paying the remaining 90%. Businesses with under 50 employees won’t pay anything if they employ apprentices under the age of 19 and will receive an additional £1000 payment to the training provider.
For companies already employing apprentices, anyone accepted before 1st May 2017 will be funded for the full duration under the terms and conditions that were in place when the scheme started.
The government wants to not only improve the quality of apprenticeships across the country, but to reach their goal of 3 million apprenticeships by 2020 – this will not only benefit many businesses, but create opportunities for enthusiastic young adults across the country.