Apprenticeships: Funding for Employers
Hadyn Luke posted this on Wednesday 16th of September 2015 Hadyn Luke 16/09/2015
Employing an apprentice in the UK not only brings fresh talent into your business but also comes with significant financial incentives and support from the government. Here’s an updated guide to the benefits and funding available to employers, including recent enhancements to the support for apprentices and employers alike.
Comprehensive Overview of Apprenticeship Funding and Support
The government offers considerable assistance to employers to help cover the costs associated with apprenticeship training. This support varies depending on whether you contribute to the apprenticeship levy and the specific circumstances of the apprentice you hire.
Financial Incentives for Employing Apprentices
- National Insurance Contributions: Employers are exempt from paying employer National Insurance contributions for apprentices under 25, as long as the apprentice’s earnings do not exceed £4,189 per month.
- Payments to Employers and Training Providers: An incentive payment of £1,000 is available to both employers and training providers for each apprentice hired who is under 19 years old, or aged 19-24 with an Education, Health and Care Plan or who have been in care.
- Increased Bursary for Care Leavers: From August 2023, the bursary for apprentices aged 16-24 who are leaving care will increase from £1,000 to £3,000, providing additional support to those entering the workforce.
Funding Arrangements Based on Levy Status
For Non-Levy Payers
Businesses not paying the apprenticeship levy contribute just 5% towards the cost of training and assessing their apprentice, with the government covering the remaining 95% up to the funding band maximum. Small businesses with fewer than 50 employees receive full funding for training costs when they employ apprentices under 19 years of age. This is managed through the apprenticeship service account, which also facilitates payments.
For Levy Payers
Those paying the levy receive funds for training and assessment, plus a 10% government top-up. These funds are managed through the apprenticeship service account, although they cannot be used for flexi-job apprenticeship agency services.
Additional Funding Opportunities
Employers may be eligible for further funding depending on their and their apprentice’s circumstances, including payments for hiring apprentices who were made redundant. This ensures businesses can support individuals seeking to restart their careers through apprenticeships.
Conclusion
The UK government’s apprenticeship scheme offers a powerful tool for businesses to develop skilled workers tailored to their needs. With the enhanced funding and support measures, including significant incentives for hiring young apprentices and additional support for care leavers, the scheme is more attractive than ever for employers. These provisions not only facilitate the growth of a skilled workforce but also support social mobility and career opportunities for young people across the country.
For further details on employing apprentices, managing funding, and maximising the benefits of the apprenticeship scheme, visit the official GOV.UK website.
