This government is transforming the apprenticeships offer into a new growth and skills offer, which will offer greater flexibility to employers and learners and support the industrial strategy.

In August we introduced new foundation apprenticeships for young people in targeted sectors, as well as shorter duration apprenticeships. These flexibilities will help more people learn new high-quality skills at work and fuel innovation in businesses across the country.

To support employers to offer apprenticeships, the government provides £1,000 payments to employers when they take on apprentices aged under 19, or 19 to 24-year-old apprentices who have an education, health and care plan or have been, or are, in care. Government also pays employers up to £2,000 for eligible foundation apprenticeships to contribute to the extra costs of supporting someone at the beginning of their career. Employers also benefit from not being required to pay anything towards employees’ National Insurance for all apprentices aged up to age 25, when the employee’s wage is below £50,270 a year.

Employers are able to benefit from a number of high-quality apprenticeships to support the development of management skills, including level 5 Operations Manager and level 6 Chartered Manager (degree), and starts on these standards have increased in recent years.

There were 10,710 starts on the level 5 Operations Manager apprenticeship standard in the 2023/24 academic year, which is a 9.6% increase compared to the 2022/23 academic year, and 2,860 starts on the level 6 Chartered Manager (degree) apprenticeship standard in 2023/24, which is a 9.1% increase compared to the 2022/23 academic year.

The government is committed to spreading opportunities and economic growth supported by a strong skills system.

This government has an extremely challenging fiscal inheritance. There are tough choices that need to be taken on how funding should be prioritised in order to generate opportunities for young people that enable them to make a start in good, fulfilling careers, and the department will therefore be asking more employers to step forward and fund a significant number of level 7 apprenticeships themselves outside of the levy-funded growth and skills offer.

The department is taking advice from Skills England, who engaged with employers and stakeholders, including the Chartered Management Institute, on funding for level 7 apprenticeships, including the level 7 Senior Leader standard, over the autumn, and the department expects to make a final decision on affected apprenticeships shortly.

Learners who have started these apprenticeships will be funded through to completion.

The government’s ambition is to encourage greater levels of private sector investment in employee training, both for apprentices and for employees more generally.

At the Spring Statement, the Chancellor announced that he would consider whether further intervention is needed to encourage employers to offer the high-quality training the UK needs. This will include examining whether the current tax system – including the operation of the Apprenticeship Levy – is doing enough to incentivise businesses to invest in the right kinds of training.

The Chancellor will update the House further in the Autumn.

The department’s reforms have created an employer-led apprenticeship system. Employers across England are now empowered to design the apprenticeship standards which meet their skills needs and to choose the apprenticeship training they need from a range of high-quality providers.

In doing so, both employers who pay the apprenticeship levy and those who do not can directly access government funding for apprenticeships. As such, local employers are in control of an apprenticeship system which enables them to address local skills needs. As a result, the department currently has no plans to devolve any funding or responsibility for apprenticeships to mayors or other local partners.

The department has worked closely with employers and mayoral combined authorities to help them better address local skills needs through apprenticeships. We have improved the apprenticeship levy transfer system, so it is easier for large employers to transfer their unused funds to smaller employers, building on the work of the West Midlands combined authority.

In September 2021, the department introduced a new online service to enable large employers to pledge funds available for transfer, allowing a much wider range of businesses to browse and apply for available funds. Employers using the service can choose to pledge funds for a specific geographic area. To date, employers including Amazon UK, DPD, and HomeServe have pledged to transfer almost £9 million.

The government is increasing overall apprenticeship funding to £2.7 billion by the 2024/25 financial year. This funding will support apprenticeships in employers of all sizes, including small employers who do not pay the apprenticeship levy and for whom the government will continue to pay 95% of training costs.

The government wants more young people to benefit from apprenticeships that offer high-quality training and opportunities for progression.

There have been 56,200 apprenticeship starts by people under 19 so far in the 2021/22 academic year, compared to 38,800 in the 2020/21 academic year, and 58,100 in the 2019/20 academic year. The proportion of apprenticeship starts in the under 19 age group have recovered, following the decrease seen this time last year, with under 19-year-olds now accounting for 27.6% of total starts.

Employers have developed 647 apprenticeship standards, 140 of which are at Level 2, which is equivalent to GCSE level, and 210 of which are at Level 3, which is equivalent to A level. The department continues to welcome the development of high-quality apprenticeship standards by employers at all levels. There have been 55,300 apprenticeship starts at Level 2 so far in the 2021/22 academic year, compared to 41,500 in the 2020/21 academic year, and 65,000 in the 2019/20 academic year. Starts at this level equate to 27.1% of total starts.

There have been 88,100 apprenticeship starts at Level 3 so far in the 2021/22 academic year compared to 69,100 in the 2020/21 academic year and 87,600 in the 2019/20 academic year. Starts at this level equate to 43.2% of total starts.

Starts at both Levels 2 and 3 still account for 70% of all apprenticeships. Further breakdowns on apprenticeship starts by age and level are published each month and are available at: https://www.gov.uk/government/statistics/apprenticeships-and-traineeships-may-2022.

The department is continuing to improve the apprenticeship system for employers. We are making apprenticeship training even more flexible, so that employers across all sectors can access apprenticeships. We are also helping employers choose more flexible training models like flexi-job, front-loaded, and accelerated apprenticeships.

The department has a range of work underway to ensure that young people can access apprenticeships more easily. This includes working on new ways to connect young people in schools and colleges with employers and providers much earlier in their final year, when they are considering their options. It also includes working with the Institute for Apprenticeships and Technical Education to identify and promote standards most suitable for those starting their careers. We are also working with employers and providers to highlight the benefits of hiring young apprentices, and increase their use of our free recruitment tools so that vacancies are accessible through our ‘find an apprenticeship’ service.

Additionally, the department is exploring options with the Office for Students to allocate up to £8 million from the strategic priorities grant to accelerate the growth of degree apprenticeships. Degree apprenticeships offer a high-quality alternative to traditional university study. They have a key role to play in ensuring that young people are doing courses that give them the skills and knowledge to move into high-value employment that benefits them and the economy.

Employers in England who pay the apprenticeship levy can access funds for apprenticeship training 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. During the 2019-20 financial year, 15% of employer accounts fully utilised the funds entering the levy-payer’s account. This is shown in the attached table.

Levy declarations relating to the 2019-20 financial year entered employer accounts between May 2019 and April 2020, as payments enter accounts a month in arrears. Payments relating to the 2019-20 financial year were made between May 2019 and April 2020, also a month in arrears. These payments cover the cost of apprenticeships training only. The cost of any additional payments to employers and/or providers and additional support, such as for English and maths training, is met by the apprenticeship budget and therefore is not deducted from employer’s accounts.

Employers have 24 months to spend the funds available to them. It is therefore possible for employers to spend more than they declare in a financial year.

Spending on the apprenticeship programme is demand-led and employers can choose which apprenticeships they offer, how many they offer and when they are offered. We do not anticipate that all employers who pay the levy will need or want to use all the funds available to them, but they are able to do so if they wish.

We know that young people are likely to be disproportionately affected by the economic impact of the COVID-19 outbreak. To help businesses offer new apprenticeships, we are providing a payment to employers (in England) of £2,000 if they hire a new apprentice under the age of 25, and £1,500 for apprentices aged 25 or over.

The levy is an important part of our approach to raising apprenticeship quality and supporting employers to make a long-term, sustainable investment in training. The apprenticeship budget funds the cost of training for both levy-paying and non levy-paying employers, as well as apprenticeships that started prior to the reforms. In the 2020-21 financial year, funding available for investment in apprenticeships in England will remain around £2.5 billion, double what was spent in the 2010-11 financial year. It is for employers to choose the apprenticeships they want for their employees, and so funds are not allocated specifically to support training for apprentices of different ages.

We are working closely with the Department for Work and Pensions to develop a programme of work, to engage with Kickstart employers and to support them to move young people onto an apprenticeship in their organisation, where this is appropriate. We have recently amended our funding rules to ensure that employers taking on an apprentice who has previously been on the Kickstart scheme is eligible for the incentive payments.

We are tripling the scale of traineeships, providing an additional 30,000 places in the 2020/21 academic year, to ensure that more young people have access to high-quality training. We have introduced incentive payments of £1,000 per learner for employers who create new work placements available this academic year. Employers that offer traineeships nationally can claim the new payment for up to 10 learners in each region. For those who are not able to take up a job or work-based learning offer, we will fund up to another year of classroom-based study in high value skill areas to support young people’s progression into employment. We will fund extra places for specific high value courses at level 3 and level 2 that are aligned to priority areas for economic recovery.

Careers information, advice and guidance is crucial to help people to achieve the skills and experience that they need and meet the demands of businesses and employers for a skilled and flexible workforce. That is why we are investing an additional £32 million in the National Careers Service up to March 2022. This investment will provide individual careers advice for 270,000 more people whose jobs or learning have been affected by the COVID-19 outbreak.

The government is committed to improving the working of the apprenticeship system and the apprenticeship levy. We are continuing to engage closely with businesses and to listen to their views about the operation of the levy and the apprenticeships programme more broadly, taking into account the impact of the Coronavirus (COVID-19) outbreak.

The government’s ‘Plan for Jobs’ will help to kickstart the nation’s economic recovery and apprenticeships will be more important than ever in helping businesses to recruit the right people and develop the skills they need to recover and grow, both now and in the long-term.

We recognise that employers at the moment face increased challenges with hiring new apprentices and so we will introduce a new payment of £2,000 to employers in England for each new apprentice they hire under 25, and a £1,500 payment for each new apprentice they hire aged 25 and over, from 1 August 2020 to 31 January 2021. Details can be found here https://www.gov.uk/government/organisations/hm-treasury.

The government is moving away from old apprenticeship frameworks, which employers said were often not equipping apprentices to do the job, towards new, higher quality apprenticeship standards being designed by employers themselves.

We are making sure that apprenticeships at every level are providing high quality training. Our reforms are making apprenticeships longer, more relevant, with additional off the job training and more rigorous assessments. The 20% off the job training rule, the shift to higher quality standards with a longer average duration, and the drop off in frameworks, have already contributed to a 20% rise in expected apprenticeship training hours over the past year. Apprenticeships on the new apprenticeship standards make up 37% of overall starts, compared to 3% this time last year.

We will continue to work closely with employers to help them take advantage of the reforms in order to grow their apprenticeship programmes and invest in the long-term skills needs of their businesses. We recently introduced the ability for levy-paying employers to transfer up to 10% of their funds to other employers, supporting further growth in starts. We meet regularly and frequently with business groups, giving them the opportunity to let us know what more we can do to make the reforms work better for them.

The department recently published an update on the progress of Apprenticeships reform. Please find a copy attached.

It is not the intention of the apprenticeship programme that companies should re-badge existing training to comply with apprenticeship regulations. Apprenticeships are a specific product defined in law. We are introducing new employer-designed standards to improve the quality of the offer and better meet employers’ skill needs, and have committed to all new apprentices being on the new standards by 2020. 253 standards are ready for delivery, and a further 277 are currently in development. Our intention is to maintain and improve apprenticeship quality, and ensure that government funds are spent on approved training to build the knowledge, skills and behaviours to achieve competency in a true occupation.

We have implemented extensive measures underpinned by statutory regulations to safeguard and improve the quality of learning provided through the apprenticeships programme.

We are continuing to focus on the quality of apprenticeships by insisting that all apprenticeships must be real paid jobs; have a minimum duration of 12 months; involve sustained training and acquisition of skills through off-the-job training; and must include English and maths for those who have not previously achieved good GCSEs in those subjects.

We regularly publish data on apprenticeships, which can be found on GOV.UK at: https://www.gov.uk/government/collections/further-education-and-skills-statistical-first-release-sfr. This includes analysis of the number of apprenticeship starts by Sector Subject Area (SSA). Our most recent statistical release shows that starts in the Arts, Media and Publishing SSA have increased 14% on the year, though employers in the creatives industries will also hire apprentices in other SSAs.

The Department for Education works closely with the Department for Digital, Culture, Media and Sport to understand the impact of the apprenticeship reforms on the creative industries. As part of this, we have committed to inviting an employer representative from the creative industries to sit on our Apprenticeship Stakeholder Board.

Government provides generous funding to smaller employers who do not pay the levy. Non-levy payers must co-invest only 10% of the costs of apprentice training and assessment in order to access 90% government funding. For micro-businesses with less than 50 employees, the 10% co-investment is waived when they hire a 16-18 year old apprentice or a 19-24 year old apprentice who is a care leaver or who has an Education, Health and Care Plan.

Our communications and engagement work helps to make sure that as many employers of all sizes are aware of the apprenticeship reforms and the benefits of taking on an apprentice. Over 40,000 employers have visited our Get in Go Far website since the current phase of the campaign launched in January, and there have been over 1.4 million views of our adverts on social media. Our national employer helpline is open all year round.

We regularly publish data on apprenticeships, which can be found on GOV.UK at: https://www.gov.uk/government/collections/further-education-and-skills-statistical-first-release-sfr. This includes analysis of the number of apprenticeship starts by Sector Subject Area (SSA). Our most recent statistical release shows that starts in the Arts, Media and Publishing SSA have increased 14% on the year, though employers in the creatives industries will also hire apprentices in other SSAs.

The Department for Education works closely with the Department for Digital, Culture, Media and Sport to understand the impact of the apprenticeship reforms on the creative industries. As part of this, we have committed to inviting an employer representative from the creative industries to sit on our Apprenticeship Stakeholder Board.

Government provides generous funding to smaller employers who do not pay the levy. Non-levy payers must co-invest only 10% of the costs of apprentice training and assessment in order to access 90% government funding. For micro-businesses with less than 50 employees, the 10% co-investment is waived when they hire a 16-18 year old apprentice or a 19-24 year old apprentice who is a care leaver or who has an Education, Health and Care Plan.

Our communications and engagement work helps to make sure that as many employers of all sizes are aware of the apprenticeship reforms and the benefits of taking on an apprentice. Over 40,000 employers have visited our Get in Go Far website since the current phase of the campaign launched in January, and there have been over 1.4 million views of our adverts on social media. Our national employer helpline is open all year round.

Since Trailblazers began, we have received 556 expressions of interest. As a result of this, 202 groups of employers have developed or are in the process developing 441 standards. There are over 1,400 employers directly involved in the Trailblazers.

A list of employers involved in standards that are still in development is available in the attached document and at the following link: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/530096/Employers_and_other_Organisations_Involved_in_Trailblazers.pdf

There are currently 202 groups of employers that have developed or are developing 441 standards. Of these, 146 standards are already approved for delivery - apprentices can start on them and Government funding for training can be used to support their delivery.

Development of apprenticeship standards continues in a broad range of occupations, from aerospace engineer to banking relationship manager, and includes professions such as manufacturing engineer and chartered surveyor.

A full list of all the standards is available in the attached document and at: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/558940/Apps_standards_list_071016.pdf

Prior to recent Government changes, the Department for Education and the Department for Business, Innovation and Skills were jointly responsible for apprenticeships policy. The Department for Education remains fully committed to working with and involving employers and business leaders in the development and implementation of apprenticeships policy.

The Institute for Apprenticeships will be employer-led and have responsibility for ensuring the quality of apprenticeship standards in England. The board will comprise primarily of employers, business leaders and their representatives. This will ensure that employers are fully engaged and continue to play a key role in improving apprenticeship quality.

Employer-led groups will continue to develop apprenticeship standards that meet their skills needs. Over 1,400 employers are currently involved in designing the new apprenticeship standards.