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Reforms to Apprenticeship Levy announced

02 October 2018

Changes to the Apprenticeship Levy have been announced by Chancellor Philip Hammond, including an additional £90m in funding.

There has been widespread criticism of the scheme, with numbers of apprenticeships falling and government targets for increased uptake missed.

Cordant Group chief executive Chris Kenneally is one of the critics of the scheme to air his views (see PFM September, page 20).

The government says the new reforms are intended to provide flexibility to enable businesses to take "full advantage of the benefits of employing apprentices".

It says the additional £90m will allow employers to invest 25% of apprenticeship funds on those working within their supply chain and is intended to boost the numbers benefiting from apprenticeship training.

An additional £5m has also been announced for the Institute for Apprenticeships to introduce new standards and update existing examples to encourage more courses and increased choice of training options.

Old frameworks will be discontinued, said the government, to ensure all apprenticeships will include the same standards by the start of the 2020/21 academic year.

The statement also said that the government will set out a process to seek views on the operation of the levy after 2020 "in the coming weeks".

Its intention is to ensure that the levy supports the development of a skilled workforce required within "the new economy".

The government claims that the levy is "making good progress", comparing the number of starts in the first three quarters of 2017/18 with the same period in the previous year.

Having recorded 119,500 starts in the most recent period, this is 10-times more than the same period 12 months earlier.

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