UK employers can transfer 10% of apprenticeship funds to third parties UK employers can transfer 10% of apprenticeship funds to third parties

UK employers can transfer 10% of apprenticeship funds to third parties
20 Feb 2018

UK employers that pay the apprenticeship levy will be allowed to transfer up to 10% of their annual apprenticeship funds to third party organisations.

The new option, announced by The Education and Skills Funding Agency on 12 February, will apply from April.

The Government hopes the change will give employers more control over the apprenticeship system and provide them with greater flexibility, according to People Management. They mean employers wanting to transfer a tranche of their levy funding will be able to choose who they give it to as long as the recipient wants to receive it and both parties are registered on the apprenticeship system. 

The 10% threshold is calculated based on the total of the employer’s levy value as well as the government’s 10% top-up, which includes a percentage put aside for English apprenticeships. 

The apprenticeship levy was introduced in April last year and applies to all employers with an annual pay bill of more than £3 million.

The Government has confirmed that any employer registered under its apprenticeship service will be eligible to receive and use transferred funds but that they can only be used to pay for training and apprenticeship assessments. 

Mark Dawe, chief executive of the Association of Employment and Learning Providers, told People Management he found it “interesting” that transfers could be given to any employer chosen by the levy payer. 

He said such flexibility may have been introduced to encourage big employers to work with smaller firms in their supply chains.

A Chartered Institute of Personnel and Development (CIPD) report published in January found that just over half of employers paying the levy required it to be more flexible. 

Gill Owen

Gill Oliver is a business and property journalist who has written for The Daily Mail/Mail Online's This is Money, The Press Association and many national and regional newspapers and magazines.

UK employers that pay the apprenticeship levy will be allowed to transfer up to 10% of their annual apprenticeship funds to third party organisations.

The new option, announced by The Education and Skills Funding Agency on 12 February, will apply from April.

The Government hopes the change will give employers more control over the apprenticeship system and provide them with greater flexibility, according to People Management. They mean employers wanting to transfer a tranche of their levy funding will be able to choose who they give it to as long as the recipient wants to receive it and both parties are registered on the apprenticeship system. 

The 10% threshold is calculated based on the total of the employer’s levy value as well as the government’s 10% top-up, which includes a percentage put aside for English apprenticeships. 

The apprenticeship levy was introduced in April last year and applies to all employers with an annual pay bill of more than £3 million.

The Government has confirmed that any employer registered under its apprenticeship service will be eligible to receive and use transferred funds but that they can only be used to pay for training and apprenticeship assessments. 

Mark Dawe, chief executive of the Association of Employment and Learning Providers, told People Management he found it “interesting” that transfers could be given to any employer chosen by the levy payer. 

He said such flexibility may have been introduced to encourage big employers to work with smaller firms in their supply chains.

A Chartered Institute of Personnel and Development (CIPD) report published in January found that just over half of employers paying the levy required it to be more flexible. 

Gill Owen

Gill Oliver is a business and property journalist who has written for The Daily Mail/Mail Online's This is Money, The Press Association and many national and regional newspapers and magazines.

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