Apprenticeship Funding Changes

DfE published the draft Apprenticeship Funding Guidance on Friday 27th May. The document includes several significant changes to note:

Off the Job Training

From 1st August 2022, the ESFA is moving from a model that calculates OTJ hours based on the total number of hours worked, replacing it with a “baseline figure” where apprentices will be required to undertake a minimum of 6 hours per week throughout the programme. So in effect, apprentices who work more than 30 hours per week can now spend less than 20 per cent of their week doing off-the-job training.

However, the volume of required OTJ training must still be guided according to the initial assessments. In other words, an apprentice may still have to undertake more than the minimum of 6 hours per week.

English and Maths

The ESFA also announced changes for learners who start a level 2 apprenticeship without level 1 English and maths. In such cases, learners will no longer have to automatically attempt level 2 English and Maths tests to complete their apprenticeship. Where appropriate, some learners will continue to work towards Level 2. However, others will be permitted to work towards level 1 English and Maths qualifications.

Initial assessment added to eligible costs

The ESFA has been reviewing eligible costs associated with the apprenticeship programme over the last 12 months.  They have indicated that the initial assessment is now an eligible cost moving forward.

The ESFA will provide full details of changes to eligible costs when it publishes the outcome of their eligible costs review.

Formula for calculating prior learning

Providers must consider an individual’s prior learning when negotiating a price with an employer. In this way, they ensure that they do not draw down funding for training and knowledge acquisition that an apprentice has already covered.

The new funding rules include a new approach or formula. It sets out how the price agreed with the employer should be reduced to reflect prior learning and knowledge.

From the start of August, providers will be required to reduce the total price by comparing the learner with prior knowledge to a learner starting with no prior knowledge and calculating the number of off the job training hours required to complete the apprenticeship.

To illustrate:

  • Where a learner has no prior knowledge, they are expected to complete 1200 hours of training.
  • Following assessment, a learner presents with prior learning and knowledge that the provider believes accounts for 360 hours. As such, the learner is considered to have prior learning and knowledge that accounts for some 30% of the standard.
  • The ESFA formula recognises the high proportion of fixed costs (50%) the provider has to carry regardless of an assessment of prior learning. Using this formula, the provider applies a 50% reduction to the number of hours of a learner’s prior learning and knowledge. In other words, a 50% reduction to 30%, resulting in a 15% reduction in the overall cost of the standard. On a £12,000 standard, this would equate to a reduction of £1,800.

Progress Reviews and Evidence of Training

Progress reviews have returned and must be completed every 8-12 weeks. Evidence of training must be provided to show that learners are in learning. Otherwise, they must go into a planned break