In conjunction with

Today’s Presenters

Nick ColquittCommercial Director

Sue ScrivensPre-Sales Consultant

David BaconSales & Marketing Director

Today’s Agenda

• 11:30 Welcome, Coffee & Networking• 12:00 The Apprenticeship Levy – Background, Scenarios & Implications• 12.30 How to Comply and Benefits• 12:50 Working Lunch• 13:10 Tools to provide Visibility & Control• 13:30 Levy Strategy Considerations• 13:45 Q&A• 14:00 Conclusion & Networking Opportunity

Apprenticeship Levy Funding Update

Apprenticeships reform

Richards & Wolfe Reviews

Low level

Poor quality

Multi occupational frameworks

Apprenticeship Standards

Level 2 - 7

Roatp

Individual standard / occupation

Apprenticeships reform

Apprenticeship funding – The new world

• Government have committed to 3 million new apprenticeships by 2020• Spending £2.5bn to transform England investment in skills and people• The changes to funding and apprenticeship qualifications will create sustainable long term footing

Apprenticeship

Levy

Co-Investment

£3m+ Payroll bill = ‘Apprenticeship Levy` payer

The facts:

• Apprenticeship levy (mandatory tax) • Government implementation 6th April 2017• 0.5% of total payroll bill• Payment via usual PAYE to HMRC• Top up of funds• Invested on apprenticeship training• Accessed via Digital Apprenticeship Service• Expiry of funds after 24 months

Allowable for corporation tax

Levy spend = Pay bill (total amount of employee earnings subject to Class 1 NI contributions (wages, bonuses, commissions, pensions)) x 0.005 – levy allowance (£15,000)

Funding will operate from 1st May 2017

Payments begin in May 2017, monthly based on prior months pay bill

Government apply 10% top up to funds monthly

For use on apprenticeship training and end point assessment

Choose programme, provider and pay

Paying the levy

Levied Employer

• Employer of 250 employees, each with a gross salary of £20,000.

• Pay bill: 250 x £20,000 = £5,000,000

• Levy sum: 0.5% x £5,000,000 = £25,000

• Allowance: £25,000 - £15,000 = £10,000 annual levy payment

Non-levied Employer

• Employer of 100 employees, each with a gross salary of £20,000.

• Pay bill: 100 x £20,000 = £2,000,000

• Levy sum: 0.5% x £2,000,000 = £10,000

• Allowance: £10,000 - £15,000 = £0 annual levy payment

How?

• Employers will calculate, report and pay their levy to HMRC, through the Pay As You Earn (PAYE) process alongside income tax and National Insurance.

• Single employers with multiple PAYE schemes will only have one allowance.• Connected employers - we intend to allow employers to share one allowance between employers which are in

connected ownership or control.• Employers will not be exempt from the apprenticeship levy if they already pay into an existing levy.

Co-investment

• Employers who haven’t paid the levy and want to purchase apprenticeship training from a provider• A levy-paying employer who with insufficient funds in their digital account to pay for the cost of training

and assessment they want to purchase

Government 90%

Employer 10%

Employer with

UK payroll bill of

more than £3M

PA

0.5% taken through Apprenticeship Levy System

monthly

£15K Government Allowance

Use to train new and existing employees on

accredited apprenticeship programmes

Don’t use your Levy contribution and treat as a

sunk cost

Other organisations can use your contributions to spend

on their own talent programme

Additional 10% monthly top up available and you must use

or lose the levy within 24 months

• Worked example

• Employer has £12,000 annually entering their levy account

• Monthly account funding = £1,000

• Top up: 10% x £1,000 = £100

• Levy monthly account increase: £1,000 + £100 = £1,100

• £13,200 annually to spend on Apprenticeships

Employers who pay the levy and are committed to apprenticeships training will be able to get out more than they pay in to the levy.

The government will apply a 10% top-up to monthly funds entering levy paying employers’ digital accounts, for apprenticeship training in England, from April 2017.

Fully utilising the levy (getting more out than you put in)

Levy Calculation ToolPAYE Bill if known 220,909,000 App levy amount from PAYE bill 1,104,545

PAYE bill from levy amount 220,909,000 App levy if known 1,104,545

Government supplement 110,455

Estimation table Total levy spend 1,200,000

Qualification Qty Spend from levy Levy utilised in estimation 1,705,000

Operations/Departmental Manager Level 5 TB 50 225,000 Levy remaining in estimation -505,001

Retail Team Leader Level 3 TB 200 800,000

Retailer Level 2 TB 50 200,000

Warehouse Level 2 200 480,000

Actual breakdown from Levy monthly tab Levy utilised from actual breakdown 1,085,000

Levy remaining from actual breakdown 115,000

Qualification Qty Spend from levy

Operations/Departmental Manager Level 5 TB 50 135,000 Additional savings Number of apprentices

Retail Team Leader Level 3 TB 200 500,000 NI saving >25yrs 390 557,520

Retailer Level 2 TB 50 150,000 16-18 incentive payments 250 250,000

Warehouse Level 2 200 300,000

Savings and incentive total: 807,520

Number Band limit

1 £1,500

2 £2,000

3 £2,500

4 £3,000

5 £3,500

6 £4,000

7 £5,000

8 £6,000

9 £9,000

10 £12,000

11 £15,000

12 £18,000

13 £21,000

14 £24,000

15 £27,000

How to spend the levyQualification type Apprenticeship title Level Framework/

Standard

Cost

Customer Service Customer Service Practitioner 2 Standard £4,000

Digital Industries Software Developer 4 Standard £18,000

Digital Industries Digital Marketer 3 Standard £9,000

Digital Industries Infrastructure Technician 3 Standard £15,000

Digital Industries Network Engineer 4 Standard £18,000

Leadership & Management Operations/Departmental

Manager

5 Standard £9,000

Leadership & Management Team Leader/Supervisor 3 Standard £5,000

Logistics & Supply Chain Supply Chain Warehouse

Operative

2 Standard £3,000

Retail Retail Team Leader 3 Standard £5,000

Retail Retail Manager 4 Standard £6,000

Frameworks vs Standards

Initial assessment Initial assessment

On-the-job & Off-the-job training

Gateway

End point assessment

Completion and certification

Occupational competence

Completion and certification

Occupational competence

On-the-job & Off-the-job training

Multi-occupational SASE frameworks Individual standard per occupation

Apprenticeships

• Employer and Training Provider

• Independent end assessment organisation

• Employer and Training Provider

• Training provider

Knowledge / Qualification

On-programme

delivery

Gateway to End Point

Assessment

End Point Assessment

Working Lunch Break – 20 Minutes

6

Workforce Rostering

Employee Self-Service

Expense Tracking

Workforce Analytics

Site Access Control

Visitor & Contractor

Management

Activity Management

Human Resources

Time & Attendance

Tools to Give Visibility, Control & Insight

Visibility, Control & Insight

• Organisational Structure & Job Roles• Job Requirements• Future Training Requirements• Record-keeping• Reporting & Analytics

Those responsible for utilising their levy pot will need to fully understand their organisation’s structure and future plans for change or growth.

Understand Growth Plans. How can you use the Levy pot to support growth?

Understand Succession Plans. Who would like to progress, who has been identified for progression and is there a skills gap?

Know the requirements for each job

Do the skills, qualifications and experience of each employee match those required for the job?

Know the future requirements for progression.

Report on and analyse your information

Report on and analyse your information

Record use of Levy Funding

Record Training Hours via Employee Self Service.

Electronic Timesheet Entry Facility

Capture the hours spent on off-the-job and applicable on-the-job apprenticeship training in order to evidence minimum 20% of total employee worked time.

Provide evidence of time spent on training per Employee.

Analytics provides a graphical view of those recorded training hours.

Monitor Employee time spent on training as a percentage of their standard contractual hours.

Utilising the levy

Apprenticeships Early CareerTalent

development

Established apprenticeship programme review

Talent pipeline & development

L&D spend

Skills gap / role diagnostics

Recruitment strategy

Apprenticeship mission and strategy:

Attract Retain Develop

Top talent & future leaders

Clearly identifiable career paths

Demonstrate socially responsible employer contribution

Backing Young Britain

Qualification reforms

Apprenticeship levy

Question & Answer Session

Thank you for attending

Please don’t hesitate to contact us

• Nick Colquitt n.colquitt@sreducation.co.uk• Nadine Hughes n.hughes@sreducation.co.uk• David Bacon dbac@crowncomputing.co.uk

Useful links

• Apprenticeships reform• Apprenticeship levy reform • Apprenticeship standards • Apprenticeship standards funding bands• Compliance & Workforce Management Tools• Create a new account