The Apprenticeship Levy was introduced in April 2017 with the aim of creating three million apprenticeships by 2020. The new reform has been quite a controversial topic over the last year, with many employers still not on board with the initiative - but now the time is running out, with only 11 months left to use your funds.
In this guide, we’ll explore everything you need to know with the time limits to funding and show you how to get started - if you haven’t already.
The Levy ‘sunsetting process’ means that employers have 24 months in which to spend their Levy funds before they leave their Apprenticeship Service Account and are transferred into the general apprenticeship funding pot.
The countdown for the ‘sunsetting process’ began when your first set of contributions arrived in your Apprenticeship Service Account. As such, it’s necessary to factor in the 24-month time limit as part of a pipeline. You’ll pay into the Levy monthly on a ‘pay-as-you-go’ basis, and funds will be removed from your account 24 months after each payment is made.
Recent figures from The Open University shows that more than £1.28 billion of the funding that has been paid into the Apprenticeship Levy is sitting within National Apprenticeship Service accounts as businesses have struggled to operate the new Levy system. Out of the £1.28 billion, only £108 million of it has been withdrawn by employers.
As the take-up is slow, if businesses continue to use the funding at the same rate, companies could lose as much as £139 million a month from April 2019. This loss could be better used to build skills, attract talent, retain staff and increase efficiency, which is why the reform was set in the first place.
30 per cent of business leaders who have accessed their Levy pot said that the process was more time consuming than they expected, so employers shouldn’t underestimate the time required otherwise they’ll risk losing out.
If you’re finding the system complex and don’t know where to begin, we’ve put together an illustrative guide on how to use your Apprenticeship Service Account. Take a look here.
Over to you
We understand that the Apprenticeship Levy can be challenging - from navigating the system to selecting new apprenticeship standards for your staff. However, our expert Levy team can help every step of the way. We can manage, implement and provide hands-on support for practically every element of the Apprenticeship Levy.
If you’ve got any questions or simply want to find out more - don’t hesitate to reach out to us on Twitter, LinkedIn or email.
And if you’re looking for further information about the Apprenticeship Levy, get in touch with our expert team today: