Much of the training cost is covered by the government, making ACCA apprenticeships a very cost-effective way of retaining and developing your staff and attracting new talent. The money largely comes from the apprenticeship levy, which large companies with an annual pay bill of £3m+ pay into. This can be used by all businesses to fund apprenticeships, regardless of size – and it usually covers at least 95% of apprentice training costs.

Incentives

The government has also increased incentive payments for employers hiring a new apprentice until 30 September 2021. Employers receive £3,000 for new apprentices of any age who join their organisation from 1 April to 30 September 2021. Employers can apply for this incentive until 30 November 2021. From January 2022 employers will be able to claim £3,000 for apprentices who start between 1 October 2021 and 31 January 2022. This is on top of the £1,000 employers already receive for hiring an apprentice aged 16-18, or someone under 25 with an education, health and care plan or who has been in the care of their local authority.

If you pay the levy

The apprenticeship levy is held in a fund that you can use to pay for apprenticeship training. The government also apply a 10% top up – meaning that for each £1 you pay, you have access to £1.10 as a training fund. The government also offers an allowance of £15,000 to offset apprenticeship levy payments, giving you extra money to spend. All levy payments are shared in the form of vouchers to be put towards tuition and training. Find out how to set up a digital apprenticeship service account, if you don't already have one. 

If you don’t have enough funds to cover the cost of training for all your apprentices, you just pay 5% of the outstanding balance and the government will pay the rest – up to the funding band maximum (currently £8,000 for Level 4 and £21,000 for Level 7). Whilst many training providers align to these caps, if you do exceed the maximum, you’ll need to pay the additional costs.

If you have unused apprenticeship funds, you can transfer up to 25% of your levy funds to support another employer. You can find employers who want to receive a transfer by:

• working with employers in your supply chain
• getting in touch with employers in your industry
• contacting an Apprenticeship Training Agency
• working with regional partners.

If you don’t pay the levy

If you don’t pay the levy, you pay just 5% towards the cost and the government pays the rest, up to the funding band maximum (currently £8,000 for Level 4 and £21,000 for Level 7). This is for apprentices aged 16 to 18, or aged 19 to 24 with an education, health and care plan provided by their local authority or who have been in the care of their local authority.

If you employ fewer than 50 employees, additional funding means the government could pay 100% of your apprenticeship training costs. In both cases, if you exceed this maximum, you’ll need to pay the additional costs.

Employers who pay the apprenticeship levy but don’t use it all can also choose to transfer up to 25% of their unused funds to you, to help you pay for training. You can find employers who may want to transfer funds by:

• speaking to your training provider
• working with employers in your supply chain 
• getting in touch with employers in your industry
• working with regional partners.

All levy and non-levy paying employers are eligible for funding – the type depends on the type of apprenticeship, qualification level and the age of your apprentice.

For Modern Apprenticeships, the contribution table from Skills Development Scotland shows how much the government pays towards the cost of training for every apprenticeship. If training costs are higher than the government’s contribution, depending on the apprenticeship, a learning provider might ask you to contribute. All this will be discussed with you right from the start.

Funding of £1000 is available for 16-19 year olds and £500 for those aged 20-24.  Funding is sent directly from Skills Development Scotland to the training provider, so you don't have to worry about it. If you have a direct contract with Skills Development Scotland and experience with apprenticeships, you may be able to deliver the apprenticeship internally. The government will then send contribution payments directly to you as the apprentice works towards their apprenticeship. You still have the option of support from a chosen training provider if there’s a part of the apprenticeship you can’t deliver. In that case, you must then pay the training provider.

Graduate apprentices

Graduate Apprentices' learning costs will be funded by Student Awards Agency Scotland (SAAS). Graduate Apprentices must apply directly to SAAS for their funding. Visit SAAS for employer guidance about funding for Graduate Apprenticeships.

Additional incentives

• Adopt an Apprentice
  If you can take on an apprentice who's been made redundant, there's a financial incentive for your business.

• Access to Work
  This publicly-funded employment support programme provides practical and financial support for individuals with a disability or long-term physical or mental health condition, to help them to start or stay in work. Funding can cover costs for things such as additional equipment, software or taxis to/from work.

• For those with a disability or who are care experienced, there's an enhanced funding contribution up to and including age 29. 

For more information on funding in Scotland

Please get in touch with Apprenticeships for Scotland, which is run by Skills Development Scotland on 0800 783 6000 or visit Apprenticeships for Scotland for more information and additional funding incentives available for employers in Scotland. Alternatively contact us and we’ll be happy to help. 

The Welsh Government is committed to supporting skills development through its all-age apprenticeship programme. That means that businesses in Wales of all sizes are eligible for government funding, including both levy and non-levy paying employers, and for new and current employees (subject to eligibility criteria). For most apprenticeships, they’ll need to be over 16 and for degree/graduate apprenticeships, they’ll need to be over 18. Funding is drawn from the national apprenticeship levy, with the Welsh Government receiving an allocation. For more information, please visit the Welsh government website.

Apprentices need to work 51% or more of their time in Wales and follow a Welsh Apprenticeship Framework.

Additional incentives

There are also extra incentives available up to 28 February 2022 to help you recruit apprentices. These apply to apprenticeships at levels 2-5, are limited to a maximum of 10 apprentices per employer, and include:

Incentive payment for 16-24 year olds

• £4,000 for each new apprentice recruited where the contract of employment is for at least 30 hours per week.
•  £2,000 for each new apprentice recruited where the contract of employment is under 30 hours per week.

Incentive payment for apprentices aged 25 and over

• £2,000 for each new apprentice recruited where the contract of employment is for at least 30 hours per week.
• £1,000 for each new apprentice recruited where the contract of employment is under 30 hours per week.

Re-employment of redundant apprentices of any age

• £2,600 for the re-employment of redundant apprentices to allow them to compete their training, where the contract of employment is at least 30 hours per week.
• £1,300 for the re-employment of redundant apprentices to allow them to complete their training, where the contract of employment is less than 30 hours per week.

Incentive payment for employing people with a disability

• £1,500 for each new apprentice recruited.
• Payments apply to all apprentices identified as disabled irrespective of age.
• Payments can be claimed in addition to the incentives above.

There are also extra funding incentives for small businesses in Wales.  Visit the Business Wales website to find out more about funding.