From April 2018, Levy-paying employers will be able to share their funds with other employers, meaning their supply chain or other smaller employers within their sector or community can benefit from funded training.
In this guide, we’ll explore how employers can transfer funds to other employers through the Apprenticeship Levy.
What we know
Initially, Levy-payers will be able to transfer up to 10% of the annual value of their levy funds to another employer. These can be transferred direct to the employer or to an Apprenticeship Training Agency (ATA) which recruits, employs and arranges training for apprentices on behalf of employers.
- Paying direct to another employer
The Levy-payer must agree what apprenticeships will be funded for the company receiving the funds.
Transferring funds to an ATA
The amount of funding that can be transferred to another employer will be reviewed by a new group of bodies including the CBI, FSB, EEF and CFG.
Employers will be able to use transferred levy funding to pay for training and assessments for new apprenticeship standards which cover the skills, knowledge and behaviours an apprentice will need to have leaved by the end of their apprenticeship.
The funds can’t be used for qualification-led apprenticeship frameworks.
Repurpose your funds
A recent study from DPG found that 93 per cent of UK managers say they won’t or don’t know if they’ll be making use of the Levy. If you’re not planning on using the Levy, you can gift 10 per cent of your funds to other companies in your supply chain - including charities and SMEs within your industry.
In fact, there are over 350,000 SMEs up and down the country that you could help to grow. In Greater Manchester alone, Business Growth Hub has helped over 500 SMEs within the last year - these companies could benefit from your funding, rather than it going to waste.
If you’d like to get in touch about transferring your funds to any of these SMEs, please email us directly and we’d be happy to connect you.
Another benefit of donating funds to smaller companies is that they’ll be able to train the apprentice from the ground up - and when the apprentice is ready to take a step up the career ladder, it could be your business that they could progress with. They will be a skilled, motivated worker with all the knowledge needed to hit the ground running and thrive in your organisation. It’s a win-win situation.
How to transfer funds
The Education and Skills Funding Agency (ESFA) will be providing more information over the next couple of months to show how it will work in practice. We’ll highlight key details to ensure a smooth process for employers.
Over to you
Transferring funds to other businesses and apprenticeship training providers can be a useful way to share unused funds and help other organisations develop.
And if you’re looking for further information about the Apprenticeship Levy, be sure to download our free, comprehensive ebook guide: