Question to the Department for Education:

To ask His Majesty's Government what was the total amount of apprenticeship levy unspent and returned to the Treasury in each of the past five years.

The apprenticeship levy is an important part of the government’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.

The government, via HM Revenue and Customs, collects the apprenticeship levy of 0.5% on total payroll from businesses across the UK with a payroll of more than £3 million. From this, HM Treasury (HMT) sets an English apprenticeships budget for the department. The apprenticeships levy is UK wide, and income from the levy also supports the devolved administrations to invest in their skills programmes.

The department’s apprenticeships budget is used to fund training and assessment for new apprenticeship starts in all employers, levy and non-levy paying employers alike, across England, and to cover the ongoing costs of apprentices already in training and any additional payments made to employers and providers. This means that levy payers’ unspent funds are used to support additional costs and apprenticeships in smaller employers

The table below shows the department’s ring-fenced apprenticeships budget and spend together with budget underspends for the last five financial years (FY).

In the last two financial years, on average, 98% of the English apprenticeships budget was spent.

Any underspends in overall departmental budgets by the end of the FY are first returned to HMT, as per the Consolidated Budgeting Guidance. As employers choose which apprenticeships they offer and when, annual spend of the apprenticeship budget is subject to employer demand.