Is your business ready for the new apprenticeship funding rules? As with any change, there are areas businesses will need to adapt to. But most importantly, accessing funding will be easier. Read on to find out more about the draft funding rules, and how Lifetime is set up to support.

The Department for Education has recently unveiled the 2024/2025 draft funding rules, revealing pivotal updates for apprentices commencing a programme from the month of August 2024. But what are the changes and what are the benefits to businesses? 

New funding changes

-      Additional Learning Support (ALS)

The ESFA have proposed that the assessment of continuing learning support needs move from a monthly to a minimum quarterly requirement. This means that the 1-2-1 check points with learners who identify as having additional support requirements can now happen in line with the progress reviews conducted every 3 months.

In addition to this, the option to integrate these evaluations with regular progress reviews has been introduced. This integration can facilitate a more holistic understanding of the learner's progress, as it combines the insights from both ALS-specific and general learning development. The timing of ALS assessments has also been made more flexible. Instead of being confined to the start of the program, these assessments can now be conducted at any point during the program, accommodating the varying learning paces and needs of different learners and enhancing the effectiveness of the ALS program. 

The new funding rules are being modified to decrease bureaucracy in claiming learning support. The shift in frequency of reviews will likely benefit businesses due to the reduction in administrative duties and time, meaning businesses will also have the flexibility to assess learning support at any time during the apprenticeship. 

Supporting learners with additional needs will always be a priority for us, so we intend to continue with more frequent interactions with learners but will now have the flexibility to adapt this based on an individual needs and circumstances. At times, this won’t always be appropriate to conduct along with the line manager present so again we will utilise this based on the individual’s preferences and the type of support that they require. 

-      Functional Skills

However, following successful pilots, there's a strong case for relaxing these requirements. This change could make apprenticeships more inclusive and accessible, particularly for those with special educational needs and disabilities. Currently, apprentices need to pass Level 1 or Level 2 Functional Skills for certain apprenticeship schemes, but the pilot allows for more flexibility.  

The changes to functional skills will allow businesses access to a larger talent pool and offer the opportunity to diversify their workforce. Additionally, loosened functional skills regulations is likely to lower training costs for companies by focusing on investing in skills that the apprentice has yet to acquire. 

-   Progress Reviews

Line manager engagement and participation is key to a learner’s success, both on the programme and in wider work. The ESFA have recognised that the administrative commitments in the form of signing and documenting attendance at progress reviews is not always appropriate, but continuation of attendance and participation in the review process is still key.

We will not be changing our expectations of employer involvement in the apprenticeship delivery, with line managers still required to attend and contribute to the review process. However, this does allow for flexibilities to be applied in terms of how we document their involvement, and we will utilise these in situations where the employer is unable to physically sign off on their commitments. It’s important that these exceptions do not become the norm and we will still be reporting this back as a means of measuring our employers’ commitment to their learners’ programmes and progress. Information on the new funding rules don't explicitly discuss changes to progress review rules, but clearer, more efficient rules could make understanding and managing these requirements easier.

-   Subcontracting

Providers are now permitted to utilise subcontractors that are not listed on the APAR list for the delivery of training and/or assessment services, provided the total subcontract value does not exceed £30,000. This means that the Department does not need to approve these third-party vendors. However, it's important to note that the prime contractor should provide general oversight to their subcontractors to ensure that they meet their contractual requirements. This may include enrolling in and using E-Verify. Furthermore, the subcontracted pounds can be applied towards all small business socio-economic categories applicable to your suppliers. 

The proposed 2024/2025 funding rules aim to create a new subcontracting threshold for better flexibility. This will likely simplify the process of hiring subcontractors, especially for those looking to employ industry specialists for training. As a result, businesses can easily engage subcontractors, access specialist knowledge, and increase training opportunities for apprentices, thereby improving the effectiveness and quality of apprenticeships. 

In summary

The anticipated removal of co-investment from apprenticeship funding regulations is predicted to enhance the accessibility of apprenticeships for small to medium-sized businesses in sectors such as adult care, early years, retail, and hospitality. This adjustment will bear the full training expenses for apprentices below the age of 21, thereby lessening the financial burden on businesses and creating more prospects for youth in these industries. This initiative is backed by an extra £60 million in funding, with businesses paying the apprenticeship levy now being able to give up to half of their unused levy to another employer for apprenticeship funding in other companies.  

Read the apprenticeship funding rules August 2024 to July 2025 here.

To learn more about how Lifetime's apprenticeship offering and more information on how we can support your business, get in touch today.