How will the Apprenticeship Levy affect YOU?
The Sutton Apprenticeship Hub tells you everything you need to know
The apprenticeship levy is a new government initiative that was announced in 2015, to help the nation deliver three million new apprenticeships by 2020. Whether you’re a local employer, a student who is planning to do an apprenticeship, or a training provider, find out how the levy will affect you….
You will need to pay the apprenticeship levy if you are an employer, in any sector, with a pay bill of £3 million or more each year. The levy will be charged at a rate of 0.5% of your annual pay bill, paid to HM Revenue and Customs (HMRC) through the Pay as You Earn (PAYE) process.
All employers will receive a £15,000 allowance to offset the payment of the levy, paid in vouchers.
The government will create an online portal known as the Digital Apprenticeship Service*, which all organisations will have access to, regardless of whether they have contributed to the levy. Employers can use the portal to ‘shop’ for apprenticeships, find accredited training providers and pay for training with their digital vouchers.
They will apply a 10% top-up to the funds you have for spending on apprenticeship training in England. The top-up will be applied monthly; at the same time the funds enter your digital account. That means for every £1 that enters your digital account to spend in England on apprenticeship training, you get £1.10.
What’s great about employing apprentices
- Higher chance of employee retention (opportunity to upskill existing employees)
- Positive impact on company bottom line
- Fresh, creative input from a young people
- Embedded skills and training from company
- Valuable long-term asset to business
Back in 2008 when apprenticeships were first introduced by the Government, vacancies for young people were limited to trade work, such as construction and plumbing. However, in the last few years, along with better technology and innovation, apprenticeships now incorporate office-based roles and exciting opportunities to meet the demands of all types of businesses.
With hundreds of students registered to the Sutton Apprenticeship Hub searching for local apprenticeships, imagine the demand on a national scale. In this modern age, students have a wide range of options after leaving school or college, and apprenticeships are high on the list.
If you’re a student located in Sutton and surrounding areas and are considering an apprenticeship, you can continue to search for vacancies on the Apprenticeship Hub as normal. You will not be required to do anything with the introduction of the apprenticeship levy, but you will benefit from it in different ways.
What’s great about the levy for apprentices
- Wider range of choice with more variety of apprenticeships
- Higher standards so you receive the best training and treatment
- Increased opportunities and likelihood of you landing a fantastic role
FOR TRAINING PROVIDERS
The Apprenticeship Hub works with 10 local training providers in Sutton, Kingston and Croydon, all of which will need to adhere to the levy. Every training provider in England will need to adapt their apprenticeship frameworks so they become ‘standards’, which have been developed in conjunction with employers.
Work has already begun on this through the government’s Apprenticeship Trailblazer programme, which has published 194 standards, of which 60 are either higher or degree apprenticeships. In April 2017, when the levy commences, the government will establish an Institute for Apprenticeships, where employers or groups can submit apprenticeship standards and assessment plans.
Training providers will continue to be responsible for the learning and training progress of the apprentice, helping them to complete their qualification.
*About the Digital Apprenticeship Service
Currently, training providers use the apprenticeship vacancies management system (Av) to list apprenticeship vacancies and traineeship opportunities on the Find an apprenticeship (FAA) service on behalf of an employer, However, The Digital Apprenticeship Service will replace the existing system.
Whether you pay the levy or not, the digital apprenticeship service will help you to:
- select an apprenticeship framework or standard
- choose the training provider or providers you want to deliver the training
- choose an assessment organisation
- post apprenticeship vacancies
From April 2017, if you pay the levy you will also be able to:
- see the funds you have available to spend in England
- set the price you’ve agreed with your training provider
- pay for apprenticeship training and assessment through the digital apprenticeship service
The Government is currently testing a pilot version, working with employers and training providers to make sure they can retrieve all of the information they need, and ensure the data collection process is efficient. A public version of the service will be live in the autumn of 2016.
By 2020, all employers will be able to use the digital apprenticeship service to pay for training and assessment for apprenticeships.
Check out our Apprenticeship Levy Guide here.
If you need any support to prepare for the apprenticeship levy, you can drop us an email at firstname.lastname@example.org