Apprenticeship funding: going up or down?

Published: 14th Sep 2016

In brief

Claim

Apprenticeship funding is being cut by 30-50%

Conclusion

Funding rates for many types of apprenticeship will fall under new rules, set to be introduced in May. Some popular apprenticeship schemes for 16-18 year olds could receive between 30% and 50% less funding for each apprentice, depending on their circumstances. At the same time, the total amount of funding available for all apprenticeships will increase.

 

There have been 2 million apprenticeships created over the past six years, with more planned.

 

There have been 2.5 million apprenticeships started since 2010. The government aims to create 3 million apprenticeships by 2020.

Claim 1 of 2

“...but will she take it from me that her words of congratulation would mean rather more if they were not accompanied by cuts of between 30 and 50% in apprenticeship funding.”

Richard Burden MP, 14 September 2015

The total amount of funding that’s available for apprenticeships will go up from April 2017, when the apprenticeship levy on businesses is introduced.

But although the total pot of money will get bigger, the way that pot is divided up will change from the start of May.

The new rules for funding mean that some types of apprenticeship are facing an effective funding rate cut: the maximum that they could be allocated under the new rules is less than what they currently receive from the government.

One analysis has suggested that some apprenticeships for 16-18 year olds could see a funding rate cut of between 30% and 50%, based on case studies of three of the most popular types of apprenticeships.

The exact reduction in funding would depend on the type of apprenticeship, and whether the apprentice would have been eligible for extra support under the old system.

Not all apprenticeships will be affected in the same way. The same analysis looked at how, in some situations, funding rates for older age groups in less deprived areas could increase.

“I simply don’t recognise the situation he’s set out in relation to apprenticeships. We have seen 2 million apprenticeships created over the six years, we are committed to seeing more apprenticeships created.”

Theresa May, 14 September 2015

About 2.5 million apprenticeships have been created since 2010, slightly more than Theresa May suggests.

The government has set a target to create 3 million by 2020.

Correction

This article originally stated that the proposed changes would take place in March. The apprenticeship levy will be introduced from 6th April, and the changes to funding rates are proposed to start from 1st May.

This factcheck is part of a roundup of Prime Minister's Questions. Read the roundup.


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