It is now two years since we introduced some of the biggest reforms this country has ever seen to the way apprenticeships are designed, delivered and paid for. The apprenticeship service opened to large employers in May 2017. Just over one year later we publicly committed to expanding the service for smaller employers who do not pay the apprenticeship levy, so that they would access apprenticeship funding through the apprenticeship service. We are now pleased to confirm that the formal transition journey for those smaller employers will begin this month, January 2020.

The transition is starting with a test phase where those smaller employers, who feel they are ready, can take advantage of the new approach, accessing apprenticeships via the apprenticeship service and all the benefits it will offer. During this test phase (January to March), additional funding will be made available to fund up to 15,000 new starts through the service.

Initially we are limiting employers to three active reservations. This will enable us to test the operation of the new arrangements and to manage a gradual transition from contracted training provision to employers arranging their apprenticeships through the apprenticeship service. Reservations will allow us to forecast, monitor and manage apprenticeships funding within the DfE’s overall budget for apprenticeships. To ensure that the spend on apprenticeships training remains affordable within the Government’s overall budget for apprenticeships, it may at times be necessary to restrict employers’ ability to reserve funding.

Opportunities to support employers through this route will be open to all main providers on the Register of Apprenticeship Training Providers (RoATP).

The existing route to market for employers, contracted funding allocations with providers, will continue to run in parallel throughout the test phase and longer transition period. This is designed to support employers and providers as they build knowledge about the new arrangements and prepare for full transition to the apprenticeship service route.

As a provider, if you would like to work with employers to access apprenticeships through the service, we want to ensure that you are aware of some changes to the arrangements for Provider Agreements (access to the apprenticeship service) and existing Contracts for Services (procured for non-levy).

Please find attached an annex which summarises the changes to the Provider Agreements, Employer Agreements and Procured Contracts for Services. Further information is also available on our website for you to refer to - provider agreement and employer agreement. We have also published an updated version of the Funding Rules and new Reservations Policy Statement.

We are committed to making sure that you have the information you need to engage with the service and understand the changes affecting apprenticeships for smaller employers that do not pay the apprenticeship levy and alongside our usual updates we will be running more information webinars in January - look out for the invitations for these via our usual channels (sign up for web alerts on GOV.UK for our ESFA Digital Blog and register for our future webinar programme). Additionally, you’ll soon be getting ‘save the date’ emails for our spring roadshows. These will also be flagged in Update – if you don’t receive Update, you can sign up here.

In the meantime you can access more information about the planned transition and what this means for training providers and employers on our ESFA youtube channel where we have published the webinars that were delivered at the end of 2019.

We look forward to continuing to work with you as we work through this important transition period.

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