Question to the Department for Education:
To ask the Secretary of State for Education, whether she has plans to increase the number of courses and training schemes that are eligible to be funded through the resources available to employers raised through the apprenticeship levy.
The government introduced the apprenticeship levy to incentivise larger businesses to develop and invest in their own apprenticeship programmes whilst ensuring the availability of funding for smaller employers wanting to offer apprenticeships. Through the levy, the government is increasing investment in the apprenticeships system in England to £2.7 billion in the 2024/25 financial year to support employers of all sizes build their workforces. As the apprenticeships levy is UK wide, income from the levy also supports the Devolved Administrations to invest in their skills programmes.
In England, employers can use their levy contributions to fund apprenticeships in their own business or transfer their funds to other businesses in their supply chain, sector or region. Funds that levy payers do not draw on is used to fund apprenticeships in small and medium sized businesses. Levy payers are not expected to use all funds available to them, though they are able to do so.
The table below shows the number of registered employer apprenticeship service accounts that utilised all their funds available, as well as the number that did not, in each financial year since the introduction of the apprenticeship levy in 2017.
FY | Number of registered employer accounts on the apprenticeship service that utilised all funds available | Number of registered employer accounts on the apprenticeship service that did not utilise all their funds available and therefore had expired funds |
2017/18 | 5650 | 7570 |
2018/19 | 5030 | 10660 |
2019/20 | 4930 | 11960 |
2020/21 | 5210 | 12230 |
2021/22 | 6790 | 11920 |
Please note that:
The funds available to levy-paying employers through their apprenticeship service accounts are not the same as the apprenticeships budget which funds apprenticeships for employers of all sizes. On average, 98% of the apprenticeships budget has been spent in the last two financial years. Spend for the 2023/24 financial year, and for future years, will be set out in the department’s annual report and accounts which will be published when available. The apprenticeships budget beyond 2024/25 will be determined at the next Spending Review.
With regard to allowing levy-paying employers to spend funds on non-apprenticeship training schemes and courses, I refer my right hon. Friend, the Member for Witham to the answer I gave on 10 November 2023 to Question 614.