Asked by: Nicholas Dakin (Labour - Scunthorpe)
Question to the Department for Education:
To ask the Secretary of State for Education, what estimate his Department has made of the amount of Apprenticeship Levy funding that has been spent on (a) Level 2 apprenticeships, (b) Level 3 apprenticeships, (c) Level 4 apprenticeships, (d) Level 5 apprenticeships and (e) Level 6 apprenticeships since 2017, and if he will make a statement.
Answered by Anne Milton
HM Treasury provides the Department for Education with a fixed annual budget for apprenticeships, separate from employers’ levy funds. This budget covers the costs of existing apprentices and new apprenticeship starts for all employers, as well as the running costs of the programme.
The amount spent on apprenticeships starts with all employers, by level, between the introduction of the levy in May 2017 and February 2019, is set out in the attached table. The amount spent in levy-paying employers is given separately. Both sets of figures include payments for additional support to learners, such as for English and maths training.
Asked by: Nicholas Dakin (Labour - Scunthorpe)
Question to the Department for Education:
To ask the Secretary of State for Education, what proportion of the funds employers have paid into the apprenticeship levy has been disbursed on apprenticeships since 2017; and if he will make a statement.
Answered by Anne Milton
From the introduction of the apprenticeship levy in May 2017 to the end of January 2019, the most recent month for which data are available, levy-paying employers utilised £601 million of the funds available to them to pay for apprenticeship training in England. This represents 15% of the total funds entering employers’ accounts in the same period (£3,905 million). The total drawdown of £601 million does not include other costs, such as incentives and additional payments for disadvantaged apprentices.
Once levy funds enter employers’ accounts, they can be used to pay for training for 24 months before they begin to expire on a rolling, month-by-month basis. We don’t anticipate that all levy-payers will use all the funds in their accounts, though they are able to. Income from the levy is also used to fund apprenticeship training for non-levy paying employers.
Asked by: Nicholas Dakin (Labour - Scunthorpe)
Question to the Department for Education:
To ask the Secretary of State for Education, what assessment he has made of the effect of the requirement for 20 percent off-the-job training on the number of Level 2 apprenticeship starts; and if he will make a statement.
Answered by Anne Milton
The requirement for a minimum of 20% off-the-job training was introduced to the funding rules in May 2017 alongside other elements of our apprenticeship reforms – including the introduction of the apprenticeship levy. It is not possible to evaluate in isolation the effect of 20% off-the-job training on level 2 apprenticeship starts.
Asked by: Nicholas Dakin (Labour - Scunthorpe)
Question to the Department for Education:
To ask the Secretary of State for Education, what estimate his Department has made of the amount that the retail sector has (a) paid into the apprenticeship levy and (b) used to fund apprenticeships since 2017, and if he will make a statement.
Answered by Anne Milton
The apprenticeship levy is collected from employers by HM Revenue and Customs.
The Education and Skills Funding Agency does not require levy-paying employers to register an industry sector when registering an apprenticeship service account and is therefore unable to supply the information on apprenticeships spending by the retail sector since 2017.
Asked by: Nicholas Dakin (Labour - Scunthorpe)
Question to the Department for Education:
To ask the Secretary of State for Education, what assessment he has made of the (a) economic and (b) employment benefits of each apprenticeship level; and if he will make a statement.
Answered by Anne Milton
Research published in 2015 demonstrates the high level of return to investment delivered by the apprenticeship programme. Apprenticeships at level 2 and level 3 deliver £26 and £28 of economic benefits respectively for each pound of government investment. This can be found at: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/435166/bis_15_323_Measuring_the_Net_Present_Value_of_Further_Education_in_England.pdf.
In October 2018, we published our Further Education: Outcome Based Success publication 2010/11 – 2015/16, which covers the destinations (into employment and learning), earnings and the progression of learners: https://www.gov.uk/government/collections/statistics-outcome-based-success-measures.
The publication reveals the average earnings, by level, of those who achieved an apprenticeship in 2015/16, one year after completion:
Over the past few years we have introduced major reforms to apprenticeships. As the system is still adapting, it is too early to know the full economic and earnings benefits that these changes will bring.
Our Apprenticeships Reform Programme Benefits Realisation Strategy, published in March 2017, sets out a broad range of success measures for the programme. We publish annual progress updates, of which the most recent can be found at: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/707896/Progress_report_on_the_Apprenticeships_Reform_Programme_May_2018.pdf.
We will be publishing our 2019 update shortly.
Asked by: Nicholas Dakin (Labour - Scunthorpe)
Question to the Department for Education:
To ask the Secretary of State for Education, how much and what proportion of the apprenticeship levy funding has been spent on the administrative costs of the (a) Education and Skills Funding Agency and (b) Institute for Apprenticeships since 2017, and if he will make a statement.
Answered by Anne Milton
Employers’ levy funds are available for them to use to cover the cost of the training and assessment of their apprentices. Employers have 24 months to spend their funds from the point they enter their accounts. These funds are not used to support the administrative costs of the system.
Separate to this, HM Treasury provides the Department for Education, including the Education and Skills Funding Agency (ESFA) and the Institute for Apprenticeships and Technical Education (the Institute), with fixed annual administration and programme budgets.
In 2017-18, the ESFA spent £36 million (equating to less than 2 percent) of the £2 billion apprenticeships programme budget on the cost to deliver and run the programme. In addition, the Institute spent £3.8 million programme budget on running the programme.
The Department for Education (including the ESFA and the Institute) are also provided with administration budgets. In 2017-18, the administration spend was approximately £6.4 million in the department, and £33 million in the ESFA. This includes an estimate of the proportion of departmental overhead costs attributable to the apprenticeships programme. In addition, £4.6 million related to administration spend for the Institute.
The department will publish spending on the running costs of the programme for 2018-19 in its annual report and accounts.
Asked by: Nicholas Dakin (Labour - Scunthorpe)
Question to the Department for Education:
To ask the Secretary of State for Education, what estimate his Department has made of the number of apprenticeship starts for (a) Level 2 apprenticeships, (b) Level 3 apprenticeships, (c) Level 4 apprenticeships, (d) Level 5 apprenticeships and (e) Level 6 apprenticeship in (i) 2020 and (ii) 2021, and if he will make a statement.
Answered by Anne Milton
The department does not produce forecasts for apprenticeship starts by level. Apprenticeships are paid jobs and their availability is dependent on employers offering opportunities and hiring apprentices to meet their skills needs; employers can choose which apprenticeships they offer, how many and when.
Asked by: Nicholas Dakin (Labour - Scunthorpe)
Question to the Department for Education:
To ask the Secretary of State for Education, what estimate his Department has made of the amount that employers will pay into the apprenticeship levy in 2020; how much apprenticeships will cost in 2020; and if he will make a statement.
Answered by Anne Milton
The apprenticeship levy is collected by HM Revenue and Customs from all UK employers with a pay bill in excess of £3 million. In the 2019/20 financial year, it is forecast that UK employers will pay £2.8 billion into the levy. Forecasts for future levy receipts are published by the independent Office for Budget Responsibility and updated monthly and they can be found here: https://obr.uk/efo/economic-fiscal-outlook-march-2019/.
The amount raised by the levy is distinct from the Department for Education’s ring-fenced apprenticeship budget, which is set to fund apprenticeships in England only. The budget has been set in advance by HM Treasury for the current spending review period which runs until the end of 2019/20.
In 2019/20, over £2.5 billion will be available for investment in apprenticeships in England. Currently, we expect to remain within budget in the 2018/19 and 2019/20 financial years. The level of funding for the programme beyond 2020 will be determined by the forthcoming Spending Review.
Asked by: Nicholas Dakin (Labour - Scunthorpe)
Question to the Department for Education:
To ask the Secretary of State for Education, what the total spend has been on (a) level 2 (b) level 3 and (c) above level 3 apprenticeships in each of the last three financial years; and if he will make a statement.
Answered by Anne Milton
The Education and Skills Funding Agency (ESFA) publishes details of apprenticeships spend in its annual reports and accounts. Overall spend for the last 3 financial years can be found at the following links: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/727363/ESFA_ARA_2017-18_WEB.pdf, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/630972/2016_to_2017_SFA_ARA_web_version.pdf and https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/630097/EFA_2016-17_Annual_Report_and_Accounts_PRINT.pdf.
The ESFA does not publish spend by level of apprenticeship. Spending on the apprenticeship programme is demand-led and employers can choose the amount, frequency and level of apprenticeships that they offer.
The following table provides an estimate of spend at level 2, level 3 and level 4 and above in each of the last 3 financial years alongside total published spend.
Estimated apprenticeship participation spend by level from 2015-16 to 2017-18 (in millions of pounds)
Financial year | Level 2 | Level 3 | Level 4+ | Participation spend | Total published spend |
2015-16 | £756 | £638 | £47 | £1,441 | £1,540 |
2016-17 | £771 | £686 | £75 | £1,533 | £1,632 |
2017-18 | £672 | £724 | £126 | £1,522 | £1,580 |
The analysis provided is based on provider earnings data taken from the Individualised Learner Record and adjusted proportionately to match participation spend figures. The amount that providers claim in earnings may differ from the amount that the provider is paid following reconciliation. These estimated spend figures will therefore not fully align with actual spend. Total spend, published in the ESFA annual report and accounts, which includes participation and non-participation, is provided alongside for reference.