Question to the Department for Education:

To ask the Secretary of State for Education, how much and what proportion of funds raised by the apprenticeship levy remain unspent for financial year 2020-21.

The funds in apprenticeship service accounts are available for levy-paying employers to use for 24 months before they begin to expire on a rolling, month-by-month basis. Employers began to pay the apprenticeship levy in April 2017 and unused levy funds began to expire in May 2019.

In the 2020-21 financial year, £2,631 million was paid into levy-paying employer’s apprenticeship service accounts. This includes the 10% government top up to funds entering employer accounts.

In the 2020-21 financial year, £1,314 million of levy funds expired from employer’s apprenticeship service account. Employers have 24 months from the point funds enter their account in which to spend it, so the expiry of levy funds in 2020-21 financial year relates to the funds which entered employer accounts in 2018-19 financial year.

We do not anticipate that all employers who pay the levy will use all the funds available to them, but they are able to if they wish. As well as funding new apprenticeships in levy-paying employers, income from the levy is used to fund new apprenticeships in employers that do not pay the levy, as well as existing apprentices that started in previous years.

The funds available to levy-paying employers through their apprenticeship service accounts are not the same as the Department for Education’s annual apprenticeships budget. The annual apprenticeship budget is set by Her Majesty's Treasury, and although closely linked, is distinct from the total levy income collected by Her Majesty's Revenue and Customs.

The levy is an important part of our reforms to apprenticeships which are vital for driving our economic recovery. It supports employers of all sizes to invest in high-quality apprenticeship training. In 2021-22, funding available for investment in apprenticeships in England will remain around £2.5 billion – double that spent in 2010-11 in cash terms.