Improvement Apprenticeships

During March 2018 the standards for Improvement Apprenticeships were release for use for Yellow & Green Belt. These standards have been developed by a number of leading Blue Chip Organisations known as the Apprenticeship Trailblazer for Improvement Standards.

The Improvement Standards include:

  1. Improvement Technician (Yellow Belt) – ready for use
  2. Improvement Practitioner (Green Belt) – ready for use
  3. Improvement Specialist/Expert (Black Belt) – ready for use
  4. Improvement Leader (Master Black Belt) – awaiting approval

Click on the links above to go directly to the standards on the Institute for Apprenticeships website.

The Trailblazer Group consist of the following organisations with Blue Lion Training Academy on the circulation list for all communications:

  • BT Group Plc
  • Toyota Motor Manufacturing (UK) Ltd
  • Chartered Quality Institute
  • International Automotive Components Group Ltd
  • Jaguar Land Rover Ltd
  • SAIC Motor UK Technical Centre Ltd
  • Capella Associates Ltd
  • Wincanton Plc
  • GLAS Business Solutions Ltd
  • develop-u
  • National Skills Academy for Food & Drink
  • Britvic Soft Drinks Ltd
  • 2 Sisters Food Group
  • Ricoh Europe Plc
  • TUI Group Plc
  • Gleeds Management Services Ltd
  • Royal Mail Group Ltd
  • GlaxoSmithKline Plc
  • nuvia Limited
  • Bee Lighting Ltd
  • Clevedon Fasteners Ltd
  • Stadco Ltd
  • Kraft Heinz Company
  • British Standards Institution
  • Morson International Ltd
  • Testlink Services Ltd
  • Rolls-Royce Controls and Data Services Ltd
  • Leonardo – Helicopter division

Q&A about the apprenticeship levy

Starting in April 2017 and continuing to develop until 2020, the Government is reforming the way Apprenticeship training is handled. Colleges, Training Providers and Awarding Bodies will no longer have control over Apprenticeship funding, instead control will be in the hands of the Employers. The initial focus will be on the introduction of an Apprenticeship Training Levy for employers with a salary bill of over £3m.

How will the Levy work in reality?

Below is an example of how a company whose wage bill of £6m, will contribute towards the levy.

  • 0.5% levy sum x £6m wage bill = £30,000 levy
  • £30,000 levy – £15,000 allowance = £15,000 payment

Employers in England who pay the levy and are committed to apprenticeship training will also receive a 10% top-up, directly into their DAS account. That means for every £1 that enters an employer’s digital account, they will actually receive £1.10.

What happens to an employer’s levy contributions?

It has been suggested that 100% of the value of the monthly levy deduction will go into an employer’s DAS account. Employers should see funds appear in their digital account monthly, a few working days after confirming their pay bill and levy contribution to HRMC for the previous month.

Applying this same wage bill to a monthly scenario can be seen below:

May 2017*

  • 0.5% levy sum x £500,000 monthly wage bill = £2,500 levy
  • £2,500 levy – £1,250 allowance = £1,250 payment
  • £1,250 payment + £125 Government Top-up = £1,375 DAS Spend
This example is for a company with 100% of its employees living in England. Further regulations apply for companies whose employees live in Scotland, Wales or Northern Ireland.

What can the Levy be used for?

The Levy can be spent on Apprenticeship Training and the associated costs. This can be used to fund things such as recruitment and CPD training to support the Apprentice but cannot be used towards their salary.

Who can deliver an Employer’s training?

The DAS will provide details of training providers that can offer the desired Apprenticeship. The system will enable virtual payments to providers that are delivering Apprenticeships for the employer. This will allow the employer to approach the provider(s) to negotiate funding, contributions and payment schedule.

Paying for an Apprenticeship?

Once an employer has selected their Framework or Standard, monthly payments will be taken out automatically and sent to the training provider over the lifetime of the Apprenticeship. It is proposed that 20% of the total cost is held back and taken at the end of the Apprenticeship. The limit on how much an employer can spend on an Apprenticeship Framework or Standard will be determined by 15 funding bands.

If an employer doesn’t spend their levy, what will happen to it?

Employers will be given 24 months from April 2017 to use the levy. If they don’t use it in that time, it will be given to other employers to use. For example, funds which enter an employer’s account in September 2017 will expire in March 2019. The digital account will let an employer know in good time when funds are due to expire.

What happens if an employer has used all, or has insufficient, funds in their Digital account?

Employers who pay a small levy or invest in a lot of apprenticeship training may find that there are insufficient funds in their digital account to cover the cost of training. In these circumstances, it is proposed that the Government pay 90% of the additional costs incurred with the employer contributing 10% directly to the training provider.

Non-Levy Paying Companies

Employers with an annual wage bill of less than £3m will not pay the levy. Instead, Apprenticeship Standards and Frameworks will be jointly funded by employers and the Government. This is called Co-Investment.

What is the payment process for recruiting an Apprentice?

The provider and employer decide on a payment schedule and put this in a written agreement. This acts as the contract for delivery between the two partners and should be legally watertight. All employer contributions must be in cash and not in kind.

When is the level of Co-investment?

It is proposed that employers ‘co-invest’ 10% of the cost of Apprenticeship training and assessment and benefit from Government funding to cover the remaining 90% of the cost. However in 2019 Government will reduce SME apprenticeship contributions from 10% to 5%

In the first year of the new funding system, employers will need to pay their co-investment directly to the training provider.

How is a price for training agreed?

Employers will agree a price and payment schedule for an Apprenticeship or Standard directly with the training provider. The Apprenticeship’s co-investment limit will depend on what Funding Band the Standard or Framework falls into. If the agreed price is higher than the Band Upper Limit, the employer will have to pay this themselves.

Here are two examples:

Below Upper Band Limit

  1. The employer agrees a price of £2,250 for an Apprenticeship that falls into Funding Band 3
  2. The Government pays £2,025 and the employer pays £225

Above Upper Band Limit

  1. The employer agrees a price of £3,250 for an Apprenticeship that falls into Funding Band 3.
  2. The Government pays £2,250 and the employer pays £1,000

Are there any extra incentives?

  1. Employers who take on a 16-18 year old will receive an additional £1,000 payment, received in two equal instalments on 3 months and 12 months. This will be sent from your training provider.
  2. For businesses with less than 50 employees, it is proposed that the Government will pay 100% of the training costs for Apprentices aged 16-18.

Can an employer gain Government funding to up-skill existing staff??

Employers should be able to use funds in their digital account (levy paying) or access Government co-investment (non-levy) to train an individual if the level of Standard or Framework is higher than their current set or qualifications or at a lower/equivalent level if the content of the training is materially different from any prior training they have received.

More Information

The answers to some of these question may change over time as more detail becomes available and as the new delivery and funding rules are released in 2018.

For more information on how the Apprenticeship Levy will affect your business, and to see how Blue Lion Training Academy can help, contact our team on 01332 987903 or email info@BlueLionTA.com