Question to the Department for Education:

To ask the Secretary of State for Education, if she will consider the potential merits of increasing the apprenticeship levy transfer ceiling to 35%.

The department is supporting employers to make greater use of their levy and has improved the transfer system to make it easier to find other employers who wish to take on apprentices with transferred funds. Levy transfers are a great way for employers to transfer their funds to other employers in their supply chains, including small employers, flexi-job apprenticeship agencies and charities to help meet local or sector-specific needs.

Levy-paying employers have been able to transfer 25% of their annual funds since April 2019, when this was increased from 10%, and have been able to use an online service since 2021 to make the process easier.

Since the new service launched in September 2021, we have seen 418 employers, including ASDA, HomeServe and BT Group, pledge to transfer over £28 million to support apprenticeships in businesses of all sizes as of 9 June 2023.

Small and medium sized enterprises (SMEs) can also access funding directly from the apprenticeships budget. The department is working to remove unnecessary barriers, making it simpler and quicker for them to set up an apprenticeship service account, to access funding and to support them to take on their first apprentice. The department has also removed the limit of 10 apprentices a year that SMEs can take on, enabling them to take on as many skilled apprentices as they need.