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What is the Apprenticeship Levy and how does it work?

The Apprenticeship Levy is a funding system in England which aims to create 3 million new apprenticeships – individuals accessing approved professional development courses and qualifications.

Apprenticeship Funding for Employers

Employers with an annual payroll of more than £3 million pay 0.5% of their payroll into the Apprenticeship Levy. The government adds 10% to each monthly levy payment. The levy payment is held in a digital account, which is set up at the apprenticeship service. Each individual’s training costs are deducted from the account and paid to the provider monthly.

The system is different for employers who have a pay bill of less than £3 million. any training and assessing costs are shared with the government, with employers paying 5% and the former covering the remaining 95%. These employers agree on a payment schedule with the provider.

If a levy-paying employer runs out of funds in their levy account, they can trigger the non-levy route.

Degree Apprenticeship funding

Employers can choose to spend their apprenticeship levy funding as they wish, including providing opportunities for current and aspiring leaders to study a level 7 qualification. These senior leader apprenticeships ensure a rigorous standard of professional development for both managers and leaders.

For instance, at Alliance Manchester Business School, our PG Diploma Management Practice can be accessed using apprenticeship levy funding. This course offers employers a cost-effective way to develop leaders, helping you to build a successful and sustainable business.