There’s been an update to the announcement regarding the level 7 apprenticeships, and as promised, here’s what you need to know so far…..
“Phillipson’s latest letter, dated April 23, said: “I have now agreed with other departments to proceed with an exemption for young people (who start when they are aged 16-21) across all level 7 apprenticeships.
“An exemption for young people aligns with our opportunity mission and our intention to rebalance the apprenticeship programme to support more young people at the start of their career, as announced by the prime minister in September 2024.”
Please see further reading here – Apprenticeships: Phillipson to exempt young people from level 7 funding axe
| Phillipson to exempt young people from level 7 apprenticeships funding axe Ministers are set to row back on plans to remove public funding from all level 7 apprenticeships and include an exemption for young people aged 16 to 21, FE Week understands.feweek.co.uk |
So whilst it is even more likely that Level 7 apprenticeships will be defunded, those aged 16–21 will be exempt from this and may still remain eligible as a new start going into the next funding year. This could particularly affect learners pursuing CIMA Courses or working towards a CIMA Qualification. What remains unclear, and still awaiting confirmation, is the point at which they turn 22 years old.
Historically, they have always looked at the age on 1st August of the funding/academic year the apprentice is being signed up, and we would hope this would continue to be the case.
It is also unclear, whether those graduating from university will be exempt, as if completing a three programme, straight from A-Levels/college and GCSES, then they are likely to be 21 years old at 31st July of the year they are graduating, so could potentially remain in-scope for an apprenticeship at level 7!
We will be watching this space for you and update accordingly!
With this news so far, what does this potentially mean for employers?
For those employers with a graduate programme, if the prospective apprentice has done a straight three year programme, they are likely to be 21 years old still on 31st July, therefore any sign ups for graduates would potentially need to happen before 31st July of the graduating year, or the academic year prior to turning 22 years. Where the graduate has either completed a year in industry as part of their degree, or taken a gap year, they are likely to be ineligible – a key consideration!
Level 2 – A 15 month route (12 months on programme with 3 months EPA) – NEW with HTFT for Sept25
Level 3 – A 15 month route (12 months on programme with 3 months EPA) – AAT
Level 4 – An 18 month route (15 months on programme with 3 months EPA) – AAT, CIMA or ACCA
Level 7 – A 36 month route (33 months on programme with 3 months EPA), CIMA or ACCA
So when looking at who you are looking to employ, please consider the above, and let us know if you have any questions about what their plan could look like.
What are some other key things to consider?
If you hire an apprentice between 16-18 years old (at the start of the academic year they are enrolled) then the government will give the employer £1,000. This is £500 on day 90 of their apprenticeship, and again on day 365. Payment is given to the training provider, who must forward to employers within 30 days of receipt.
If you hire an apprentice under the age of 25 years (likely to be updated based on these changes taking place), and are paying less than £50,270 per year, then employers may be exempt from paying class 1 national insurance for the apprentices they hold.
Not claiming your exemption? Read more here – Paying employer National Insurance contributions for apprentices under 25 – GOV.UK
| Paying employer National Insurance contributions for apprentices under 25 From 6 April 2016, employers may not need to pay Class 1 National Insurance contributions for an apprentice, if the apprentice:. is under 25 years old; is on an approved UK government …www.gov.uk |
For non-levy employers, if you hire apprentices between 16-21 years at the start of the academic year, the government will pay 100% of the apprenticeship, instead of the current 95%
Foundation apprenticeships, this *could* include the Level 2 (accounts or finance assistant standard). This could mean a reduction of 12 months on programme learning to a minimum of 8 months.
End point assessments are currently under review across all standards, which may impact learners working towards an AAT qualification or any other accounting qualification. Anyone already signed up is likely to see further updates released, which we will communicate to you and each apprentice in turn as soon as more information becomes available.
Levy transfers allow a levy-paying employer to transfer 50% of their fund to other businesses, making it available to those that either do not contribute to the levy or have insufficient funds for their apprentices. This system can significantly benefit companies investing in AAT accounting courses, helping them support staff development and build future talent without bearing the full training cost.
What’s the benefit? It comes down to the 5% co-investment which would otherwise be required due to insufficient funds in the ‘pot’. If you are a levy-paying business and have excess funds in your pot, do consider transferring this to other businesses. Likewise, if you are a non-levy client or concerned that you will have insufficient funds, get in contact for further information. Funding opportunities can be particularly useful for training programmes such as the Level 2 Certificate in Bookkeeping or the Level 3 Certificate in Bookkeeping, helping learners gain valuable qualifications without financial strain. Any unused levy pots are claimed by the government after 2 years – use it, don’t lose it.
