Question to the Department for Education:

To ask the Secretary of State for Education, what recent discussions she has had with the Chancellor of the Exchequer on the review of the Apprenticeship Levy.

Education is a devolved matter, and the response outlines the information for England only.

The apprenticeship levy is an important part of the department’s reforms to create a high-quality, employer-led apprenticeships system, and it supports employers of all sizes to invest in high-quality apprenticeship training.

There are no current plans to review the apprenticeship levy. My right hon. Friends, the Secretary of State for Education, and the Chancellor of the Exchequer meet regularly to discuss how apprenticeships and skills can contribute to economic growth.

The department continues to improve the apprenticeships system for employers and apprentices. We have made apprenticeships more accessible for all sectors through the development of flexi-job and accelerated apprenticeships, and we are working with providers to simplify the apprenticeship system through our ‘You said, we did’ programme.

The apprenticeships budget is used to fund training and assessment for new apprenticeship starts in levy and non-levy paying employers, and to cover the ongoing costs of apprentices already in training and any additional payments made to employers and providers. The annual apprenticeship budget is set by HM Treasury (HMT) and although closely linked, it is distinct from the total levy income collected. The apprenticeship levy is paid by all eligible UK employers and funding linked to its income is distributed proportionately between England, Wales, Scotland and Northern Ireland. The table below shows the department’s ring-fenced apprenticeships budget against the total apprenticeships spend in England for the last five years. This shows that in the 2021/22 financial year 99.6% of the apprenticeships budget in England was spent, with only £11 million unspent. As is usual practice, any underspends in overall departmental budgets by the end of the financial year are first returned to HMT as per the Consolidated Budgeting Guidance.

Department’s ring-fenced apprenticeships budget and total apprenticeships spend, financial years 2017/18-2021/22