General 66: Apprenticeship Levy
Posted on 15 February 2017 by education.finance
We have received a communication from HR Strategy Manager, Jo Fellows FCIPD:
You will be aware that the Government are making significant changes to apprenticeships. HR in January 2017, sent out information via a schools communication discussing how different types of schools will be affected by the Levy and if you are a Community or Voluntary Controlled school, a ready reckoner to work out what financial contribution you will make to the County Council’s Levy account.
Since that communication was published, the Government have issued their response to the consultation about the Public Sector Apprenticeship Target and further information on the new Digital Apprenticeship Service (DAS) and Institute for Apprenticeships. HR is currently looking at this information and will provide an updated communication via the Schools Comms website over the next few weeks.
HR have already received some questions from schools, which they have answered below, but if your question has not been answered please contact the HR Strategy Team who will be able to assist you further.
Q.) ‘I currently receive a £1500 payment back from our apprenticeship training provider for the business admin apprentice that we employ. Will this continue when the new Levy is implemented?’
A.) You will need to check with your training provider what the payment is for. However, it sounds as though this payment is the Government’s Apprenticeship Grant for Employers of 16 to 24 year olds (known as ‘AGE 16 to 24’). You can find out more about this Grant on the Government website. HR have been advised by the Skills Funding Agency that this Grant will be ceasing this year, when the new Levy arrangements come in. The Government are continuing to offer additional funds to employers (outside the Levy) for particular groups who take up apprenticeship qualifications, like care leavers or those with special needs. Your training provider will be able to provide you with more information on the funds that may be available.
Q.) ‘Our school is part of a Federation. Some of the schools in the Federation are voluntary controlled (VC) and some are voluntary aided (VA). What happens with regard to the levy?’
A.) Each school in the Federation is treated separately with regard to the levy. In this circumstance, the VC schools have to contribute to DCC’s levy account, whereas the VA schools will only be eligible for the levy if they have a pay bill of more than £3m per annum and if they are eligible, they will have their own levy account.
Q.) ‘Our school is part of a Federation, which consists of just voluntary aided (VA) schools. Together, our overall pay bill would be over £3m per annum, but separately it would not. Do we have to pay the levy?’
A.) Each school in the Federation is treated separately with regard to the levy and therefore if each pay bill is below £3m per annum, they will not be eligible to pay the levy. Each school will be able to access funds to pay for apprenticeship training directly from the Government (called ‘co-investment’).
HR appreciate that for Federations, particularly those with single budgets, there could be confusion about where any apprenticeship training is funded from (i.e. from the DCC Levy account, the schools Levy account or via Co-investment for non-Levy paying schools). We are seeking clarity from the Skills Funding Agency about how this will work in practice and will provide further advice before the new arrangements commence on 1st May 2017.
Q.) ‘What rate of pay do I need to pay an apprentice?’
A.) Any employees undertaking apprenticeship qualifications need to be paid the National Minimum Wage or National Living Wage, dependent upon their age and progress through their qualification. You can find out the current rates online. If you are a DCC community or Voluntary Controlled school you must pay the NJC rate, which is Grade A for a basic level apprenticeship.
Please keep an eye out for further communications, but in the meantime please do not hesitate to contact your HR Provider if you have any questions.
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