accessing levy funds
Levy paying employers will be able to use the service from April 2017.
- Funds appear in the account monthly a few days after the company has confirmed and paid the levy charge. This means that the first funds should appear in late May 2017.
- Government will apply a 10% top up of the funds which will be applied at the same time as the funds enter the account.
- Funds will expire 18 months after entering the account but funds are used on a First In/First Out system.
- In the first year funds will be available to pay for training and assessment for your own employees. The idea of using funds to pay for apprenticeships in the supply chain will be reviewed and further information provided in June 2017.
- Some employers will want to use the funds in the account to pay for training of apprentices employed by an ATA and this again will be reviewed with more information provided in June 2017.
- Apprentices that start before April 2017 will be funded for the full duration of the apprenticeship as per the current T&Cs and levy contributions cannot be used to fund these.
- Funds can only be spent with an approved training provider or approved assessment organisation
- Once the apprenticeship has started, monthly payment will automatically be taken from the digital account and sent to the provider. The Government is responsible for making sure the funds reach the provider but in future there will be more flexibility over the way payments are made.
- Funds can only be used for the cost of training and end point assessment – not other costs associated with the apprentice.
- A price will be agreed between the training provider and the levy-paying employer. This price will then be paid monthly over the lifetime of the apprenticeship. If the price is more than the cap the employer will be required to pay the excess.
- Those employers that choose not to use the digital account will need to buy training directly from the training provider and follow the same process as employers who don't pay the levy.
- Those not paying the levy will agree a price with a training provider and will then be required to make a contribution to the cost of the training, with the government paying the rest up to the maximum available for that apprenticeship. Schedule of payments will be agreed between training provider and the company.
- This 'Co-investment' rate of support from the government will be release in June/October 2016.
What if the digital account fund runs out?
Companies will be similar to a non-levy paying companies and will be able to do ‘Co-Investment’. Once the apprenticeship training has been bought through the digital apprenticeship service:
- Funds will be taken from the digital account each month to pay the training provider.
- The provider will work out if the amount paid from your digital account is less than 100% of the amount due that month.
- The provider will calculate how much more you have to pay (using the rate set for employer co-investment) and agree with you when you will pay this.
- The provider will pay the government share direct to the provider.
- The provider will be asked to confirm that you have made your contribution
DAS will be used for this purpose and reasons for such payment stopping may be:
- Apprentice ceases their training
- Apprentice takes a break from training
- Service provided from training provider is not as agreed