Written on: 4 March 2021
Written by: Frances Hardcastle
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The Government incentives hiring apprentices have the potential to be transformational for young people and employers alike.
Alongside a much-needed cash boost for businesses, the scheme encourages employers to grow their own talent, creating some amazing opportunities for young people to start a rewarding career, or to retrain for emerging industries.
The scheme originally ran from August 2020 to September 2021, offering £3000 grants for employers to take on a new apprentice. In October, an extension was announced by Chancellor Rishi Sunak at the Conservative Party Conference.
This fund will now run until January 2022.
In this blog, we’ll guide you through the system used to manage these grant payments – covering everything you need to know to claim your apprenticeship incentive.
Employers who take on a new apprentice of any age can receive an incentive payment of up to £3,000. Those hiring apprentices aged 16-18 can also claim an additional £1000 payment under a pre-existing scheme.
These employer incentive grants must be claimed through the government’s digital apprenticeship service.
The apprenticeship service will be new to many employers, especially SMEs, but as of April 2021, all new apprenticeships are managed via this online system.
The apprenticeship service, also known as the Digital Apprenticeship Service, or DAS account, is an online platform created by the Education and Skills Funding Agency (ESFA). It is used by employers and training providers to reserve and administer funding for apprentices.
The apprenticeship service was originally designed to enable large employers to manage their apprenticeship levy funds, and has been expanded to help smaller organisations reserve funding for apprenticeships.
To claim your apprenticeship employer grant, you’ll need to create an account with the digital apprenticeship service.
You can register for an account with the apprenticeship service at any time before your apprentice starts their training. It can be useful to create your digital account early on – around the time you’ve made an offer. This can prevent delays further down the line when you can’t wait to welcome your new apprentice.
To create an account with the apprenticeship service, you’ll need a Government Gateway login for your business, authority to set up a new PAYE scheme on behalf of your organisation, and be able to accept an employer agreement between your company and the ESFA.
Once you’ve got this information lined up, the account registration process is quite straightforward. This screen-capture video from the ESFA takes you through each stage, step by step:
You can add multiple users to your organisation’s apprenticeship service account so you can include colleagues from other departments if you need to.
If you’re a non-levy paying organisation (those with an annual wage bill under £3 million), you are eligible for government funding towards the cost of apprenticeship training fees. This can cover between 95% and 100% of training fees, and is known as “co-investment.” To claim this generous subsidy alongside the employer incentive grant, you will need to reserve apprenticeship funding through the digital apprenticeship service.
You can set this up as soon as you’ve chosen your apprenticeship standard and know which month you’d like your apprentice to start their training.
Employers will be able to claim their employer incentive grants via the digital apprenticeship service.
For employers who hired an apprentice between 1st April and 30th September 2021, you must claim your funding before 30th November. Your apprentice will also need to be inducted onto their training programme before this date.
For employers hiring an apprentice between 1st October 2021 and 31st January 2022, you will need to claim your grant in January, when the claims process reopens.
To claim, you’ll need your organisation’s bank account information and the details of the apprentices you want to claim for.
The apprenticeship employer bonus is split into two equal payments. The first is made after your apprentice has been enrolled on their training programme for 90 days. The second part is paid after they have been learning for a year.
Most existing sources of apprenticeship funding can be claimed alongside the new employer incentives. This includes:
With such a variety of funding available, there has never been a better time to take on an apprentice!
The apprenticeship service offers query handling and technical support via phone, email, SMS, web forms and live web chat. This service, along with a comprehensive range of online help resources, can be accessed via their website.
At Baltic, we’re always happy to guide our employers through any problems or questions they may have around apprenticeship funding or their digital account. Feel free to get in touch with our friendly and helpful team!
Note: This blog was originally published in August 2020. It was last updated on 14th October 2021 to reflect the recent extension to the apprenticeship incentive scheme.
Written on: 12th January 2022Read blog post