Question to the Department for Education:

To ask His Majesty's Government what percentage of apprentice levy-paying employers have transferred the maximum 25 per cent of their levy contributions to other employers in each financial year since 2017–18.

Answered by Baroness Barran - Parliamentary Under-Secretary (Department for Education)

Levy paying employers have been able to transfer a proportion of their annual funds to other employers since April 2018, when the maximum transfer allowance was 10%. This was increased to 25% in April 2019 and from 22 April 2024, the department has doubled the levy transfer allowance to 50%.

The table below shows the percentage of levy-paying employers who spent all of their transfer allowance in each financial year from 2018/19 to 2023/24.

Transfers provide levy paying employers with more flexibility about how they spend the funds available to them, including supporting other businesses such as smaller employers, flexi-job apprenticeship agencies and charities to help meet local and sector-specific needs. The department has improved the transfer system, introducing a pledge and match service on GOV.UK, to make it easier to find other employers who wish to take on apprentices with transferred funds. Since the service was introduced in September 2021, over 500 employers have pledged to transfer over £37 million to support apprenticeships in businesses of all sizes, as of 9 February 2024.

Question to the HM Treasury:

To ask His Majesty's Government how much money (1) was raised by the apprenticeships levy, and (2) was passed onto the devolved nations from levy receipts, in each financial year since 2017–18.

Answered by Baroness Vere of Norbiton - Parliamentary Secretary (HM Treasury)

Monthly receipts data for the Apprenticeship Levy is published by HM Revenue and Customs in their Tax and NIC Receipts publication which can be found online[1] at: https://www.gov.uk/government/statistics/hmrc-tax-and-nics-receipts-for-the-uk

While the Apprenticeship Levy is UK wide, apprenticeship policy and spending is devolved. From FY2017-18 to FY2019-20, the devolved administrations received a population share of the Office for Budget Responsibility’s apprenticeship Levy forecast. Beyond 2019-20, the devolved administrations received funding through the Barnett formula in relation to English apprenticeship spending. The Block Grant Transparency publication which is available on GOV.UK sets out all Barnett consequentials generated at both departmental and programme level. It is for the devolved administrations to allocate their funding in devolved areas as they see fit, including investing in their skills programmes.

[1] HM Revenue & Customs (2024), HMRC tax receipts and National Insurance contributions for the UK

Question to the Department for Education:

To ask His Majesty's Government whether children in low-income families are permitted to use funding from the apprenticeship levy to stay on at secondary school.

Answered by Baroness Barran - Parliamentary Under-Secretary (Department for Education)

Apprenticeships are jobs with training that are open to anyone aged 16 and over. The apprenticeship levy was introduced to support employers of all sizes to invest in high-quality apprenticeship training. The department’s annual budget for apprenticeships in England has increased to over £2.7 billion in the 2024/25 financial year. This budget is ringfenced for spend on apprenticeships training and assessment only to meet employer demand for high-quality apprenticeships and cannot be used for other purposes.

To ensure that every child, regardless of their background, can excel at school and achieve their full potential, the department has targeted a greater proportion of the schools national funding formula towards deprived pupils than ever before. In total, 10.2%, over £4.4 billion, of the formula will be allocated according to deprivation factors in the 2024/25 financial year and 17.8%, or £7.8 billion, will be allocated for additional needs overall. This will help schools in their vital work to close attainment gaps and level up educational opportunities.

The pupil premium grant, introduced in 2011, also offers direct funding to schools to improve educational outcomes for disadvantaged 5 to 16 year olds in state-funded schools in England. The department increased the premium pupil funding to over £2.9 billion this financial year to ensure the most disadvantaged pupils receive the support they need to succeed at school.

The department is providing funding to ensure that every 16 to 18 year old has a place in further education or training if they want one. The department invested over £7 billion on 16 to 19 programme funding during the 2023/24 academic year, which included over £590 million to support students who are economically deprived and to account for low prior attainment in English and mathematics. Over £35 million has also been allocated in the 2023/24 academic year to provide free meals for 16 to 19 year olds in further education. Additionally, the department allocated over £159 million of bursary funding to institutions in the 2023/24 academic year to help disadvantaged 16 to 19 year olds with costs such as travel, books, equipment and trips, which is nearly 12% higher than published allocations for the 2022/23 academic year.

Question to the Department for Education:

To ask His Majesty's Government what plans they have to change the apprenticeship levy and to grant firms more flexibility to use funds from the levy to skill up their workforce.

Answered by Baroness Barran - Parliamentary Under-Secretary (Department for Education)

The apprenticeship levy supports employers of all sizes to invest in high-quality apprenticeship training, both for career starters as well as those looking to upskill or retrain.

The success of the levy is enabling the department to invest £2.7 billion in apprenticeships in England in the 2024/25 financial year, and means that 98% of the English apprenticeships budget was spent over the 2021/22 and 2022/23 financial years. It is important that this funding remains protected to support apprenticeships. The government has no current plans to allow employers to spend the funds available to them on non-apprenticeships training. Allowing employers to use 50% of funds for non-apprenticeship training could create an additional cost of up to £1.5 billion a year. Without additional investment this could reduce apprenticeship starts to 140,000 a year, which would represent an almost 60% decrease on the 2022/23 academic year.

This month the department increased the proportion of the funds that levy-paying employers can transfer from 25% to 50%. This gives levy-paying employers even greater flexibility in how they use the funds available to them while also supporting more apprenticeships in other businesses, including small and medium-sized enterprises, flexi-job apprenticeship agencies and charities.

Employers can choose from almost 700 high-quality apprenticeships and have the option of using flexible training models, such as flexi-job apprenticeships and accelerated apprenticeships. Employers can also access other government-funded skills programmes, including T Levels and Skills Bootcamps.

Question to the Department for Education:

To ask the Secretary of State for Education, what assessment her Department has made of the effectiveness of apprenticeship levy networks in improving small businesses’ access to apprenticeship levy funding.

Answered by Luke Hall - Minister of State (Education)

The apprenticeship levy supports employers of all sizes to invest in high-quality apprenticeship training. Transfers are a great way for large employers to use their levy funds to support apprenticeships in other businesses, including small and medium sized enterprises (SMEs), flexi-job apprenticeship agencies and charities, to help meet local or sector skills needs. This could include businesses in their supply chain.

The department continues to promote the benefits of levy transfers and has increased the proportion of their funds that levy-paying employers can transfer to support more apprenticeships in other businesses from 25% to 50%. This will help SMEs hire more apprentices by reducing their costs and enabling them to benefit from the support and experience that larger employers can provide.

Hundreds of large levy-paying employers have already taken advantage of the opportunity to transfer their unused levy funds to other businesses. Since September 2021 over 550 employers, including ASDA, HomeServe, and BT Group, have pledged to transfer over £37 million to support apprenticeships in businesses of all sizes. It is also encouraging to see regional schemes to support local businesses through transfers, including in the West Midlands.

SMEs can also access funding directly from the apprenticeships budget. The department has increased investment in the apprenticeships system in England to over £2.7 billion this financial year to support employers of all sizes, including SMEs. In addition, last year, the department removed the limit to the number of apprentices that SMEs can take on, making it easier for them to grow their businesses. This has already benefitted almost 350 SMEs. The department also now fully funds the costs of training and assessment for new apprentices aged 16 to 21 in small businesses.

Question to the Department for Education:

To ask the Secretary of State for Education, what steps her Department is taking to (a) support and (b) promote regional levy networks.

Answered by Luke Hall - Minister of State (Education)

The apprenticeship levy supports employers of all sizes to invest in high-quality apprenticeship training. Transfers are a great way for large employers to use their levy funds to support apprenticeships in other businesses, including small and medium sized enterprises (SMEs), flexi-job apprenticeship agencies and charities, to help meet local or sector skills needs. This could include businesses in their supply chain.

The department continues to promote the benefits of levy transfers and has increased the proportion of their funds that levy-paying employers can transfer to support more apprenticeships in other businesses from 25% to 50%. This will help SMEs hire more apprentices by reducing their costs and enabling them to benefit from the support and experience that larger employers can provide.

Hundreds of large levy-paying employers have already taken advantage of the opportunity to transfer their unused levy funds to other businesses. Since September 2021 over 550 employers, including ASDA, HomeServe, and BT Group, have pledged to transfer over £37 million to support apprenticeships in businesses of all sizes. It is also encouraging to see regional schemes to support local businesses through transfers, including in the West Midlands.

SMEs can also access funding directly from the apprenticeships budget. The department has increased investment in the apprenticeships system in England to over £2.7 billion this financial year to support employers of all sizes, including SMEs. In addition, last year, the department removed the limit to the number of apprentices that SMEs can take on, making it easier for them to grow their businesses. This has already benefitted almost 350 SMEs. The department also now fully funds the costs of training and assessment for new apprentices aged 16 to 21 in small businesses.

Question to the Department for Education:

To ask the Secretary of State for Education, whether she has made an estimate of how many and what proportion of businesses have used their apprenticeship service account to transfer unused levy funds to SMEs in each of the last three years.

Answered by Robert Halfon

Transfers are a way for large employers to use their levy funds to support apprenticeships in any other business, including smaller 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 quicker and simpler. Since September 2021, over 500 employers, including ASDA, HomeServe and BT Group, have pledged to transfer over £33 million to support apprenticeships in businesses of all sizes.

The table below shows the number and proportion of levy-paying employers that have used their apprenticeship service accounts to transfer funds to non-levy paying employers in each of the last three financial years. The department does not hold transfer data specific for small and medium enterprises (SMEs), but can confirm that SMEs represent most non-levy employers on the apprenticeship service.

When reviewing these figures, it is important to note that only unused funds can be transferred. Some employers make full use of their levy funds and so have no funds to transfer.

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether he has made an estimate of the interest earned on apprenticeship levy funds in each of the last three years.

Answered by Nigel Huddleston - Financial Secretary (HM Treasury)

The Treasury is not able to make estimates of whether interest is earned on apprenticeship levy funds. The Apprenticeship Levy is not legally hypothecated, so revenues from the levy are paid into the Consolidated Fund.

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what estimate his Department has made of the revenue raised from the apprenticeship levy in each of the last three years.

Answered by Nigel Huddleston - Financial Secretary (HM Treasury)

Monthly receipts data for the Apprenticeship Levy is published by HM Revenue and Customs in their Tax and NIC Receipts publication which can be found online at:

https://www.gov.uk/government/statistics/hmrc-tax-and-nics-receipts-for-the-uk

Please see below for a table of the estimated number of employers paying the Apprenticeship Levy over the last three years:

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, how many companies have paid the apprenticeship levy in each of the last three years.

Answered by Nigel Huddleston - Financial Secretary (HM Treasury)

Monthly receipts data for the Apprenticeship Levy is published by HM Revenue and Customs in their Tax and NIC Receipts publication which can be found online at:

https://www.gov.uk/government/statistics/hmrc-tax-and-nics-receipts-for-the-uk

Please see below for a table of the estimated number of employers paying the Apprenticeship Levy over the last three years:

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what estimate he has made of the total revenue raised via the apprenticeship levy from businesses in Scotland for each of the last five years.

Answered by Nigel Huddleston - Financial Secretary (HM Treasury)

Reliable estimates of the revenue raised from businesses in Scotland from the apprenticeship levy are not available as any estimate would need to be based on where employers are registered, and therefore would not necessarily reflect where the liabilities are accrued or where employees are based. Any estimate would not include businesses registered in Wales, Northern Ireland, or England, who have a presence and pay employees in Scotland.

Question to the Department for Education:

To ask the Secretary of State for Education, pursuant to the Answer of 8 January 2024 to Question 7553 on Apprentices: Taxation, what the process is for the reallocation of funds in apprenticeship accounts that have expired; and what the destination of those funds were in the latest period for which data is available.

Answered by Robert Halfon

The funds in levy-paying employers’ apprenticeship service accounts are distinct from, and operate on a different basis to, the department’s apprenticeships budget. The former represents funding for apprenticeships notionally available for use by individual levy-paying employers over a two-year period. The latter represents the total amount of funding available annually to support apprenticeships in England for all employers, including those who do not pay the apprenticeship levy.

The funds available to levy-paying employers through their apprenticeship service accounts are notionally hypothecated based on their levy contributions over a two-year period. These funds do not constitute a ‘physical’ pot of money; they should be considered more as credit that is available for each levy-paying employer to use if they wish.

When a levy-paying employer has an employee on an apprenticeship, their account will show their available funds being debited each month to reflect the cost of this training and assessment. In parallel but entirely separately, the training provider receives an equivalent value monthly payment directly from the department’s apprenticeships budget. These payments do not actually come from levy-paying employers’ accounts.

Since available funds in each levy-paying employer’s account are notionally hypothecated, there are no monies to ‘reallocate’ when unused funds expire after 24 months. The credit is either drawn down, and equivalent payments separately made to training providers from the department’s annual budget, or expires when not used and the department’s annual budget remains the same). The government expires funds after 24 months because otherwise levy-paying employers would accrue unreasonably large balances, with the potential to create financial commitments that the government has not planned to meet.

On average, 98% of the English apprenticeships budget has been spent over the last two financial years. If the department’s apprenticeships budget is not fully spent by the end of the financial year, funds are returned to HM Treasury in line with standard practice set out in the Consolidated Budgeting Guidance.

Question to the Department for Education:

To ask the Secretary of State for Education, pursuant to the Answer of 8 January 2024 to Question 7553 on Apprentices: Taxation, what estimate he has made of the amount of apprenticeship levy that will expire and be returned in each month from December 2023 over the next three years.

Answered by Robert Halfon

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 to boost the skills of their workforces.

The funds in apprenticeship service accounts are available for levy-paying employers to draw on for 24 months before they expire on a rolling, month-by-month basis. In December 2023, £104 million expired from levy-paying employers’ apprenticeship service accounts. Demand for apprenticeships is employer-led and the government does not have an estimate of future levy expiry from employers’ apprenticeship service accounts.

The funds available to levy-paying employers through their apprenticeship service accounts are not the same as the apprenticeships budget which funds apprenticeships in England for employers of all sizes. As such, expired funds from employers’ accounts do not represent funding that is lost to the system. Rather, the department directs this funding to supporting apprenticeships in small and medium-sized enterprises, to English and mathematics training for apprentices and to additional payments to employers, training providers and apprentices. Therefore, the department’s spend against its annual apprenticeship budget is a better indicator of the extent to which employers’ levy contributions are being utilised to drive skills development in England. On average, 98% of the English apprenticeships budget has been spent over the last two financial years.

Question to the Department for Education:

To ask the Secretary of State for Education, pursuant to the Answer of 8 January 2024 to Question 7553 on Apprentices: Taxation, what the total spend from apprenticeship levy accounts was in each year since 2017; and how much and what what proportion of that spend came through the (a) apprenticeship levy and (b) top-up.

Answered by Robert Halfon

The table below shows the total spend from levy-paying employers’ apprenticeship service accounts in each financial year since 2017/2018.

These figures do not cover the total spend on apprenticeships in levy-paying employers, such as additional payments for English and maths support and for taking on apprentices aged 16 to 18.

It is not possible to provide a breakdown of this spend by employers’ levy contributions and the 10% government top-up to those contributions.

Question to the Department for Education:

To ask the Secretary of State for Education, whether she has made an assessment of the potential merits of allowing employers in (a) commercial laundries and (b) other sectors to use 25% of their apprenticeship levy funds for non-apprenticeship training.

Answered by Robert Halfon

I refer the right hon. Member to the answer I gave on 10 November 2023 to Question 614.

Question to the Department for Education:

To ask the Secretary of State for Education, pursuant to the Answer of 13 December 2023 to Question 3789 on Apprentices: Taxation, what the total expired unused Apprenticeship Levy funds were in each month since May 2019.

Answered by Robert Halfon

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 to boost the skills of their workforces. As the apprenticeship levy is UK-wide, income from the levy also supports the Devolved Administrations to invest in their skills programmes.

Employers in England who pay the apprenticeship levy can access funds for apprenticeship training and assessment by registering for an apprenticeship service account. The funds in employers’ accounts reflect the ‘English percentage’ of an employer’s levy contribution and include a 10% top-up from the government. The department does not record industry, sector or organisation type when levy-paying employers register an apprenticeship service account. For this reason, data which shows which sectors were most or least likely to spend their funds cannot be provided. The department does hold information relating to individual employer accounts but it would not be appropriate to disclose this information without consulting with employers.

Employers can use their levy funds for apprenticeships in their own business or transfer up to 25% of their funds to other businesses. Funds that levy payers do not draw on are used to fund apprenticeships in small and medium sized businesses who do not pay the levy. Levy payers are not expected to use all funds available to them, though they are able to do so.

The funds in apprenticeship service accounts are available for levy-paying employers to draw on for 24 months before they expire on a rolling, month-by-month basis. The table attached shows the total funds that expired from levy-paying employers apprenticeship service accounts in each month since May 2019. The decline in levy expiry value for October 2021 was due to a delay transferring levy into employer accounts. As a result, employers were granted an additional month to spend those funds, to ensure that the 24-month window to spend funds was maintained.

The funds available to levy-paying employers through their apprenticeship service accounts are not the same as the apprenticeships budget which funds apprenticeships in England for employers of all sizes. As such, expired funds from employers’ accounts do not represent funding that is lost to the system. Rather, the department directs this funding to supporting apprenticeships in small and medium-sized enterprises (SMEs), to English and mathematics training for apprentices and to additional payments to employers, training providers and apprentices. On average, 98% of the English apprenticeships budget has been spent over the last two financial years.

Question to the Department for Education:

To ask the Secretary of State for Education, which (a) sectors and (b) employers were (i) most and (ii) least likely to utilise the funds provided through the apprenticeship levy in the latest period for which data is available.

Answered by Robert Halfon

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 to boost the skills of their workforces. As the apprenticeship levy is UK-wide, income from the levy also supports the Devolved Administrations to invest in their skills programmes.

Employers in England who pay the apprenticeship levy can access funds for apprenticeship training and assessment by registering for an apprenticeship service account. The funds in employers’ accounts reflect the ‘English percentage’ of an employer’s levy contribution and include a 10% top-up from the government. The department does not record industry, sector or organisation type when levy-paying employers register an apprenticeship service account. For this reason, data which shows which sectors were most or least likely to spend their funds cannot be provided. The department does hold information relating to individual employer accounts but it would not be appropriate to disclose this information without consulting with employers.

Employers can use their levy funds for apprenticeships in their own business or transfer up to 25% of their funds to other businesses. Funds that levy payers do not draw on are used to fund apprenticeships in small and medium sized businesses who do not pay the levy. Levy payers are not expected to use all funds available to them, though they are able to do so.

The funds in apprenticeship service accounts are available for levy-paying employers to draw on for 24 months before they expire on a rolling, month-by-month basis. The table attached shows the total funds that expired from levy-paying employers apprenticeship service accounts in each month since May 2019. The decline in levy expiry value for October 2021 was due to a delay transferring levy into employer accounts. As a result, employers were granted an additional month to spend those funds, to ensure that the 24-month window to spend funds was maintained.

The funds available to levy-paying employers through their apprenticeship service accounts are not the same as the apprenticeships budget which funds apprenticeships in England for employers of all sizes. As such, expired funds from employers’ accounts do not represent funding that is lost to the system. Rather, the department directs this funding to supporting apprenticeships in small and medium-sized enterprises (SMEs), to English and mathematics training for apprentices and to additional payments to employers, training providers and apprentices. On average, 98% of the English apprenticeships budget has been spent over the last two financial years.

Question to the Department for Education:

To ask His Majesty's Government how many apprenticeship starts at level 6 were for legal, finance and accounting in 2021–22 and 2022–23; how many of these apprentices were employed in levy-paying organisations; and how many there were in each region.

Answered by Baroness Barran - Parliamentary Under-Secretary (Department for Education)

Level 6 Apprenticeship starts in the legal, finance and accounting route in the 2021/22 and 2022/23 academic years are shown in the tables below, along with breakdowns by region, and where starts were supported by apprenticeship service account levy funds.

Level 6 Apprenticeship starts in the legal, finance and accounting route:

Of which supported by Apprenticeship service account levy funds:

Of which by region:

Notes for tables:

(1) Volumes are rounded to the nearest 10.

(2) Data source is the individualised Learner Record.

(3) Geography is based upon the home postcode of the learner. Where the postcode is outside of England or not known it is included in the 'Outside of England and unknown' category.

(4) Geographies are taken from the National Statistics Postcode Lookup.

(5) Please see the 'Further education and skills statistics: methodology' document for more information about how 'supported by Apprenticeship service account levy funds' is derived.

(6) Route information is based on the latest information held on the IfATE 'Search the apprenticeships' page at the point of publication.