Apprenticeship developments Mark Emmerson Interim Director of Commercial Development July 2017

What is an Apprenticeship? A job with a training package attached Currently Seevic College services over 400 apprentices and 100s of local and national businesses Normally apprentices work four days for the employer and spend 1 day in college training to meet the “off the job 20% training requirement” The minimum wage for an apprentice is £3.50 per hour rising to the national minimum wage in the apprentices second year - many employers pay higher rates to secure the best candidates - we can help you with suggestions dependant on the role/level etc. According to GOV.UK, a stunning 89% of apprenticeship employers said apprentices helped their business improve the quality of their product or service. 83% of apprentices said their career prospects had improved too.

Overview of changes Government launched an Employer Levy in April 2017 Organisations with a paybill over £3 mil pay 0.5% into their Levy Fund Calculated on the basis of employee earnings and for employers - paid into the Levy through your PAYE Funding is going to you so you can choose your Apprenticeship training provider and we provide you with a fully costed Apprenticeship training model Employers who do not qualify to pay the Levy will continue to access Government funding for Apprenticeships, some of which will be Levy funds recycled for use with SMEs Seevic College is a fully Registered Apprenticeship Training Provider (RoATP) in the region so can support your Levy funding if you select us.

Overview of changes (2) All Apprenticeships will require an employer contribution – 10% (in most circumstances if you’re a non-Levy customer) The old Apprenticeship Frameworks are slowly being replaced by the new Standards – these now include new independent End Point Assessments The new Standards now include compulsory 20% off the job training – we can discuss this with you to ensure compliance There is an allowance of £15,000 to offset against Levy liability (see FAQs)

Frequently Asked Questions (1) Can employers opt out of paying the Levy? No, this is a mandatory tax that came into effect from April 2017. Qualifying organisations must pay the Levy regardless of whether they decide to commit to Apprenticeship training or not. If an organisation’s payroll bill is less than £3m, do they still pay the Levy? No - only companies with a payroll bill of £3m or more will have to pay. Is the Levy per registered company or per PAYE reference? PAYE reference.

Frequently Asked Questions (2) Does the Levy apply to bonus payments? Yes, the Levy payment is 0.5% of your total gross PAYE. Will I get any incentives for taking on apprentices? Employers delivering the new Apprenticeship standards may be eligible for up to three incentive payments: for recruiting a 16-18 year old, for a small business (less than 50 employees 10% contribution cancelled) and for successful completion approximately £1,000 Currently £500 after successfully completing 3 months and £500 on successful completion. What can the Levy allowance be spent on? The Levy allowance can be spent on Apprenticeship training that falls within an approved Standards list. It cannot be spent on anything else such as internal training or apprentice salaries.

Frequently Asked Questions (3) How will an employer be able to access their Levy allowance? An employer’s Levy allowance will be available for use via the new digital vouchers managed through a Digital Apprenticeship Service. Employers will be in direct receipt of these vouchers and will be able to spend them only with approved colleges and training providers. https://www.gov.uk/guidance/register-of-apprenticeship-training-providers What if my apprenticeship training costs exceed my levy allowance? The Government have outlined that they will allow employers to draw down additional funds from unclaimed Levy allowances, and pay for 90% of any additional delivery over your Levy allocation but you must pay the first 10% your training provider must collect and evidence before the additional funding is released.

Frequently Asked Questions (4) How long do employers have to use their Levy allowance? Levy digital vouchers are valid for two years from the month of PAYE deductions. If vouchers remain unused after this time, other employers will be able to access these funds to cover the costs of additional apprenticeship training within their organisation and you will lose the funding. Can I use multiple training providers? Yes you can, but they must be on the list of Registered Apprenticeship Training Providers known as RoATP. https://www.gov.uk/guidance/register-of-apprenticeship-training-providers

Frequently Asked Questions (5) Who qualifies for an Apprenticeship? Apprentices must be 16 years or older; not in full time education, and living in England. There are no upward age restrictions for apprentices, however each Apprenticeship is subject to a minimum length of 12 months, so you must be prepared to make a commitment for at least this period. Seevic apprentices must already have obtained A-C Level 2 qualifications in English, Maths and ICT before starting their Apprenticeship - we can deliver a Level 2 Functional Skills if one qualification is missing but no more. Can I use the Levy allowance to offer apprenticeships to existing staff? Yes. Existing staff can also be eligible for an apprenticeship, as long as it is relevant to their role and is the most appropriate way of developing their skills. If you’re not sure if your existing staff would qualify, please contact our Business Solutions Team on 01268 882 654.

Frequently Asked Questions (6) What happens after the apprentice finishes the training? Ever year we have to provide the destination data of our Apprenticeship provision. Last year i.e. Academic Year 2015/16 87% went into employment – 10% progressed into Higher Education/Apprenticeship or other training. By taking on an apprentice, you’ll be helping to turn a young person into a real asset for your company - and the country. Is this just another tax? No – well ok, it is a tax in a way - but the Government’s motivations are sensible. The idea of the Levy is to raise an extra £3 billion to fund training of the next generation of workers. Training is needed to help productivity and your companies to grow. The Levy is a fund you can tap into, so why not take advantage - use it or lose it?

Frequently Asked Questions (7) My company does not pay the Levy – what happens now? Apprenticeships for employers who don’t qualify for the Levy will continue to be able to access funding for their Apprenticeships via a registered training provider on the Government’s national training register. What to do next? Employers should begin by modelling the cost to them based on their current UK payroll bill. Consider your workforce development strategy and look at how Apprenticeships could help you to deliver new skills and expertise in your business. Talk to local experts, like the Business Solution Team at Seevic, and find out how your Apprenticeship programme can be delivered efficiently, maximising impact and minimising the costs and risk to your organisation. For further questions regarding the Levy, or Apprenticeships in general, please contact the Business Solution Employer Engagement Team on 01268 882 658.

Frequently Asked Questions (8) What Apprenticeships does Seevic currently offer? We have become specialists in specific Apprenticeships - currently we offer: AAT Accounting Business Administration Childcare/ Teaching Assistants Marketing Pharmacy Supporting Teaching & Learning in Schools (STLS). For further questions regarding the Levy, or Apprenticeships in general, please contact the Business Solution Employer Engagement Team on 01268 882 658.

How do you calculate the Levy? Example A Employer of 250 employees, each with a gross salary of £20,000 Wage bill: 250 x £2,0000 - £5,000,000 Levy Sum: 0.5% x £5,000,000 = £25,000 Allowance: £25,000 - £15,000 = £10,000 annual Levy Payment Example B Employer of 100 employees, each with a gross salary of £20,000 Wage bill: 100 x £20,000 - £2,000,000 Levy Sum: 0.5% x £2,000,000 = £1,0000 Allowance: £10,000 - £15,000 = £0 annual Levy Payment

More news Further details are emerging every week - please contact us for the most up-to-date information and how we can support your organisation with Apprenticeships and staff training. Call 01268 882 658 Email apprenticeships@seevic-college.ac.uk

How can Seevic College help? Free assessment on how to utilise your Levy or access your digital voucher Co-creation of a sustainable local model to maximise investment and training development opportunities for your company Free selection/recruitment process – saving you time and money with potential candidate selection. We can support you with the bureaucracy of claiming your Levy back and offering Apprenticeship opportunities.

Useful links https://www.gov.uk/government/publications/apprenticeship-levy- how-it-will-work http://levy-calculator.icon-training.com/ http://www.seevic-college.ac.uk/apprenticeships.aspx