This document summarizes recent changes and upcoming reforms to apprenticeship funding in England between 2015-2020. Key points include: apprenticeship funding being protected at £3 billion over parliament; the introduction of the apprenticeship levy in 2017 for large employers; reforms to apprenticeship standards and assessment; and the establishment of the Institute for Apprenticeships and increased role of employers in the system. It also outlines funding rates and bands, procurement for non-levy paying employers, and opportunities for additional funding through ESF and local growth funds.

1. Apprenticeship Funding Outlook
and Opportunities
Updated January 2017

2. Highlights: 2015 to 2020
• Spending Review in Nov 2015, stated core skills budget was
protected.
• SFA ASB cut 2014 - 16 replaced by AEB. Growth of
2016/17 onwards and allocations for apprentices, and 16-
18 Traineeship.
• No workplace learning supported.
• App funding arrangements for 2016/17 onwards were
announced in April 2016. Further details followed in June,
October, and December 2016.
• App funding protected 3 million starts in the parliament.

3. Highlights: 2015 to 2020
• Introduction of the 10% top-up and rule for employers
turning over £3m annually in April 2017.
• Retender of ITP AEB contracts from 2017/18, affected by
localism.
• Retender of ITP apps contracts for non levy paying
employers, and for starts from 1st May 2017.
• Funding contract year to move to April/March.
• Government funding focus for FE - App, Traineeships,
English and Maths, (Effectiveness/Simplicity/Localisation)

4. Apprenticeship Under Reform: April/May 2017,
Onwards
• Funds set to expire 24 months after entering digital
account if remained unspent.
• Funding for apprenticeship at same or lower level than
qualifications held.
• Evidence required of 20% off job training.
• Trailblazers: Employers leading development of new
standards. First standard based app’s delivered from
2014/15. 4,400 enrolled on standards in 2015/16.
• End point Assessment: New regulated assessment
organisations.

5. Apprenticeship Under Reform: April/May 2017,
Onwards
• Introduction of Register of Apprenticeship Training Providers
(RoATP). Approved providers get direct funding from May
2017.
• Digital Apprenticeship Service:
 Select an apprenticeship framework or standard
 Choose the training provider or providers you want to
deliver the training
 Choose an assessment organisation
 Post apprenticeship vacancies
• Institute for Apprenticeships from April 2017 – governance
and standards approval.
• Non levy employers wont need to use DAS until at least 2018.

6. Apprenticeship Under Reform: April/May 2017,
Onwards
• Every app framework and standard placed in funding band.
• Non levy paying employers pay 1/10 contribution for standard
or framework from May 2017.
• Employers with more than 50 employees don’t pay 1/10
contribution for 16-18 year- olds.
• Commitment to transfer of 10% of funding from levy paying
employers to other employers/ATA from 2018.
• Digital Apprenticeship Service, levy paying employers are
able to:
 View the funds available to spend in England
 Set the price, as agreed with the training provider
 Pay for app training and assessment through the DAS.

7. Apprenticeship Under Reform: April/May 2017,
Onwards
• 16-18 year olds: Employers and training providers receive an
additional £1,000, paid 3+12 month.
• Frameworks Only:
 16-18 year olds: 20% uplift of band max, transitional measure
 Disadvantage uplift: £600/£300/£200 10%/10-20%/20-27%,
paid 3 + 12 month.
 STEM uplift of 40% for L2 and 80% for L3
• Additional learning needs continues to be funded at £150 per
month.
• English and Maths funded direct to provider at £471.
• Funding for app at same or lower level than a qualification they
already hold.

8. Apprenticeship Funding Bands
Number Band Upper Limit
1 £1,500
2 £2,000
3 £2,500
4 £3,000
5 £3,500
6 £4,000
7 £5,000
8 £6,000
9 £9,000
10 £12,000
11 £15,000
12 £18,000
13 £21,000
14 £24,000
15 £27,000

9. Register of Apprenticeship Training Providers
• Effective from 1st May 2017
• Needs to be registered to deliver an app. Separate to RoTO
• Opens up whole provider market to directly access funds, £100k limit remains.
• Subcontract allowed if main provider has ended relationship at programme
level.
• 3 application routes:
 Main Route: an also be subcontractor
 Supporting Route: £500k limit
 Employer Route: Delivery of app to own employees and/or act as
subcontractor
• Application tests:
 Due diligence test.
 Financial health test.
 Quality, capacity and capability tests
• Grade 4 Ofsted for app provision ineligible.
• Open for applications from 25.10.16 to 25.11.16, result March 17.
• Parent company guarantees accepted in first year.
• Reopens every 3 months, refresh every 12 months.

10. Register of Apprenticeship Training Providers
• Effective from 1st May 2017
• Needs to be registered to deliver an app. Separate to RoTO
• Opens up whole provider market to directly access funds, £100k limit remains.
• Subcontract allowed if main provider has ended relationship at programme
level.
• 3 application routes:
 Main Route: an also be subcontractor
 Supporting Route: £500k limit
 Employer Route: Delivery of app to own employees and/or act as
subcontractor
• Application tests:
 Due diligence test.
 Financial health test.
 Quality, capacity and capability tests
• Grade 4 Ofsted for app provision ineligible.
• Open for applications from 25.10.16 to 25.11.16, result March 17.
• Parent company guarantees accepted in first year.
• Reopens every 3 months, refresh every 12 months.

11. Procurement for Employers Not Using a Digital
Account
• Open for applications from 25/10/16 to 25/11/16, results
out on March 17th
• Period covered May 2017 to July 2018, option to increase
to 2020
• Sections to be completed include: Readiness to deliver
from the contract commencement date, track record,
management, reporting and quality assurance, engaging
with and meeting the needs of employers, delivery of wider
apprenticeship training, support for employers and their
apprentices and delivery plan.

12. Procurement for Employers Not Using a Digital
Account
• Open for applications from 25/10/16 to 25/11/16, results
out on March 17th
• Period covered May 2017 to July 2018, option to increase
to 2020
• Sections to be completed include: Readiness to deliver
from the contract commencement date, track record,
management, reporting and quality assurance, engaging
with and meeting the needs of employers, delivery of wider
apprenticeship training, support for employers and their
apprentices and delivery plan.

13. Traineeship
 Work preparation/placement, English/Maths, plus flex
to deliver vocational qualification.
 Changes since start: Extended to 16-24, min/max
work placement time removed, pre level 3
harmonised for 16-18/19-24, further JCP flexibilities
to ease delivery/benefit conflict, combined work
prep/placement from 8/15, Grade 3 providers can
deliver from 8/16.
 16-18 and 19-24 funding growth challenging.

14. Advanced Learning Lessons
 For Level 3 and 4 stand alone qualifications.
Extended to 19+ and L5 and 6 from August 2016.
 Growth area and further opportunities here – 2019/20
£480 million budget – budget always underspent.
 No subcontracting from 2017/18

15. RPA: Raising Participation Age
 Must remain in education to age 18 (currently 17) from August 2015
(includes school 6th form, FE College courses, apprenticeships,
traineeships).
LEP’s: (Local Economic Partnerships)
 Increasing in importance, responding to local needs.
 City Deals, Devolution, Combined Authorities.
 AGE/ESF/SFA (AEB) contractual requirement to have dialogue.

16. Post 16 Skills Plan
 Accepts Sainsbury Report
 15 technical routes, only covers 43% of jobs covered e.g. no retail
 One awarding org for each technical route
 Renaming of the Institute for Apps to the Institute for Apps and Technical
Education
 Pilots from 2019
SFA Changes
• Further restructuring of agency with large staff reductions.
• PFA audits increasing in importance and rigour.
• Grade 2 Ofsted is the minimum level of expectation
• New Outcome Based Success Measures being introduced
• BIS dissolved, FE now under DfE
• SFA possibly to disappear in March 2018

17. Area Reviews of Post 16 Education & Training
Institutions (completed by April 2017)
• Area-based reviews of post-16 education and training will examine economic
and educational needs in local areas and how current provision must change
to meet these needs, involving Local Enterprise Partnerships. Following these
reviews and the introduction of the levy funding, we expect to see fewer,
larger and higher quality colleges.
• By 2020, we will expect to see further education colleges taking a greater
share of the apprenticeship training market (including Institutes of Technology
and National Colleges), alongside employers offering apprenticeship training
directly, universities providing higher and degree apprenticeships, and
independent providers.
• We will streamline processes to reduce barriers to new providers entering the
market and getting on the RTO.
• The arrangements for subcontracting between providers to be reviewed.

18. Fixing the Foundations: Creating a More Prosperous
Nation. The Government’s Productivity Plan (further
emphasis post Brexit)
• A highly skilled workforce with employers in the driving seat
• Skills (FE) will play a critical role in improving ULPLC
productivity
• Apprenticeships the driver

19. Future Opportunities
 New ESF Rounds:
• Bidding Dec 2015 to July 2016
• £650m
• Delivery period of 18 months
 Growth case opportunities with SFA for Apprenticeships and
Traineeship
 LEP linked opportunities e.g. Big Lottery Fund, Communities
 Local Growth Fund £12bn - £1.8bn for economic growth and job
creation. LEP’s need to bid by summer 2016
 Increase of contracted providers for apprenticeship from 985 to 3,420 –
how will PFA and Ofsted cope?

20. Everything starts with a conversation, so let’s talk:
Safaraz Ali
Linkedin: https://uk.linkedin.com/in/safaraz
Twitter Handle: @SafarazAli
Tel: 0121 707 0550