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Apprentices: Taxation

Department for Education written question – answered on 4th November 2019.

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Photo of Gordon Marsden Gordon Marsden Shadow Minister (Education)

To ask the Secretary of State for Education, what assessment he has made of the ability of apprenticeship levy paying employers to transfer levy funds to non-levy paying employers.

Photo of Michelle Donelan Michelle Donelan Government Whip, The Parliamentary Under-Secretary of State for Education

We are committed to supporting employers to engage with apprenticeships to help invest in the long-term skills needs of their business. We have already seen employers making use of transfers to support apprenticeship starts in their supply chains, or to meet local skills needs. Since April 2018 there have been 1,020 transferred commitments where the transfer of funds between apprenticeship service accounts had been approved. Of these transferred commitments, 780 have so far resulted in apprenticeship starts.

We have taken a number of steps to make it easier for levy-paying employers to transfer funds to other employers. In response to employer feedback, in April 2019 we raised the cap on transfers to 25% of the annual value of funds entering levy-payers’ apprenticeship service accounts. We have also announced that we will shortly enable levy payers to transfer funds to cover the full cost of training for 16 to 18 year olds in the smallest businesses with fewer than 50 employers.

Transfers give levy-paying employers more options in how they use their levy funds, as well as creating apprenticeship opportunities for organisations who may have previously felt that employing an apprentice was beyond their reach. We are pleased to see that levy payers with uncommitted funds are increasingly using transfers to support apprenticeship starts in non-levy paying employers.

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