Reforms for the Apprenticeship Grant for Employers opens new opportunities for FE

The National Apprenticeship Service have received confirmation that Ministers and HM Treasury have formally agreed the following package of reforms for the Apprenticeship Grant for Employers:

  1. Pay the employers the full amount of £1500 13 weeks after the apprentice starts, instead of two instalments of £750 at weeks 8 and 52
  2. Extend the scheme to mid-sized businesses with up to 1000 employees, with the proviso that at least 50% of the grants (20,000 of the 40,000 grants available) should still be targeted at SMEs (companies employing no more than 250 employees)
  3. Increase the number of grants a single employer can claim to 10, up from the current limit of three
  4. Relax the rule informally known as the "3 year rule" so that an employer will be eligible for AGE if they have not employed an apprentice in the last 12 months.

The Treasury have agreed that to revisit the 3 year rule in the autumn, when NAS review the whole scheme with them.

Most commentators think these announcements represent a positive change for the apprenticeship incentive which was running into a few blockages over conditions, so the relaxation of the rules could be a help for getting schemes up and running.  In particular, the changes will open up the opportunity to medium size employers where there is existing demand for apprenticeships schemes.

There are three groups of employers that need to be considered and NAS will be moving on getting the message out to them but equally providers may want to take the opportunity to return to employers who have been previously rejected for the grant who now fit the criteria:

  1. Employers who have previously applied and been accepted for AGE under the old "split payment" rule
  2. Employers who have previously applied and been turned down for AGE, but would now be eligible under the new rules. This group should be proactively contacted and offered the grant
  3. Employers who did not previously apply for AGE but  will be eligible under the new rules. This group should be dealt with on a case by case basis, if they get in touch to request the grant retrospectively
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