How Much will the Apprenticeship Levy Cost?

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By Sue Lamb
on 27 May, 2017

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A Government initiative or another form of funding cut?

With the general election looming, much has been said about the proposed funding cuts that many schools are facing with the introduction of the National Funding Formula from 2018/2019.

These proposed cuts are threatening the quality of education that children will receive, as school leaders look at ways to stretch their reduced budgets, with many reducing staffing levels, reducing curriculum choice or asking parents for contributions towards the cost of their child’s education.

The introduction of the Apprenticeship Levy has put some schools under even more financial pressure due to the additional costs that the levy imposes. Maintained schools in particular will be hit the hardest, as the local authority is deemed to be the employer and therefore its annual wage bill will be well above the threshold of £3m, whilst still only receiving one rebate of £15,000 into its digital account.

The table below shows an example of the impact to schools for the levy:

Type Of School

Annual Payroll Costs

Amount of Levy per annum

Maintained LA School

£800,000

£4,000

Voluntary Aided School

£800,000

£0

Multi Academy Trust

£800,000

£0

Maintained LA School

£1,500,000

£7,500

Voluntary Aided School

£1,500,000

£0

Multi Academy Trust

£1,500,000

£0

Maintained LA School

£2,500,000

£12,500

Voluntary Aided School

£2,500,000

£0

Multi Academy Trust

£2,500,000

£0

Maintained LA School

£3,500,000

£17,500

Voluntary Aided School

£3,500,000

£2,500

Multi Academy Trust

£3,500,000

£2,500

Some may say that as a maintained school there will be more funds available in the digital account for each school to access, however, these funds cannot be used to fund the wages of these staff and they can only be accessed for the training of staff from a list of approved training providers. With many schools struggling to make ends meet as it is, they will therefore be unable to afford to employ new apprentices, which defeats the government initiative and the reason for the levy in the first place.

In some cases, whilst trying to balance their budgets, the real cost of this levy to schools could mean the loss of teaching assistants, lunchtime organisers or valuable education resources, all of which will have an impact in school.

Perhaps it is time that the levy charge to schools is reconsidered and the initiative amended to focus on ensuring that all schools have sufficient budgets to sustain the cost of every child’s education, after all the children of today are the next generation of apprentices.

If you have concerns about how to manage the impact of the Apprenticeship Levy on your school finance, contact Sue Lamb on 0844 967 1111.

 

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