Funding and the Levy

What is the ‘Levy’?

To fund the increase in apprenticeships, the Government introduced an apprenticeship levy in April 2017. The levy amounts to a 0.5% tax on the wage bill for employers whose salary costs are £3 million or more each year.

Employers paying the levy are able to access their funding through the digital apprenticeship service to pay the provider of their choice. Funds will expire 24 months after they enter your apprenticeship service account unless you spend them on apprenticeship training with a training provider, such as the University of Northampton.

Employers that don’t pay the Levy

Small businesses with a pay bill of less than £3 million will have 95% of the training fees for apprentices paid on their behalf by government funding. The government will ask you to make a 5% contribution to the cost of this training and government will pay the rest, up to the maximum amount of government funding available for that apprenticeship. As both you and the government make a payment, this is called ‘co-investment’.

Further information

For more information about how the funding works, please visit the government website. You can also find information regarding the apprenticeship funding rules and guidance for employers here.

Incentive payments for hiring a new apprentice

The government has introduced incentive payments that employers can apply for if they take on a new apprentice between 1 August 2020 and 30 September 2021. For more information, please visit the website

Guidance for apprenticeship subcontracting fees and charges

Management fees in the rare occasion the University engages with an apprenticeship ‘subcontracting’ provision, its management fee will typically vary between 15% and 30% of all funding received for the provision to be delivered.

The agreed management fee will be dependent upon the activities being undertaken and the level of support required in order to maintain provision of the highest quality.

Target learner numbers, previous experience, success rates and the level of risk determined by the due diligence process will also be taken into consideration when determining the management fee.

The management fee represents the cost which the University incurs in effectively identifying, selecting and managing all of its sub-contracted provision.

The University may also retain with prior agreement, in addition to the management fee, an appropriate amount of funding to cover the cost of any funded activity which it undertakes which is related to the provision, such as:

  • Awarding Organisation fees and charges
  • Hiring of facilities/equipment within/from the College
  • Internal Verification.
University of Northampton students at Waterside Campus sitting around a table and doing their work on their laptops

The University of Northampton takes gold...

We have also been given the Gold Award in the Government's Teaching Excellence Framework (TEF) – the highest rating possible which places us among the elite of the UK's higher education institutions.

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