The Education and Skills Funding Agency has asked employers and providers for feedback on the way it provides apprenticeship funding rules information.

The agency called volunteers to take part in a survey which aims to make sure its funding rules are “clearer, easier to use” as well to learn more about its users.

It follows recent mystery no-notice audits carried out by the agency as well as separate research by the Department for Education into whether apprenticeship delivery is being adjusted to account for apprentices’ prior learning.

A number of providers told FE Week last month they were given two days’ notice to hand over up to 100 apprentice files by ESFA staff. After two days working through the files, they left without taking away any of the material.

It is believed these searches have been prompted by concerns at the unpublished results of the qualification achievement rates for 2017/18, as well as its investigation into disgraced apprenticeship firm Aspire Achieve Advance (3aaa).

Meanwhile, the DfE has also asked suppliers to research if and how employers and providers are adapting training and the associated costs to take into account the prior learning of apprentices.

Today, the ESFA called employers, employer-providers and training to contribute to its research, which will add to the “insight to the user feedback we have already gathered”.

Respondents are being asked to disclose if their organisation is currently paying the apprenticeship levy, how many times they have consulted the funding rules in the past twelve months and if the information available in its website is understandable.

They are also encouraged to provide further comments on how the agency could improve their experience.

The survey is open until March 14.

DfE’s research into high prices for apprentices with prior learning is due to start in the week commencing April 1. The final report will be issued on August 30.

The launch of ESFA’s survey also follow National Audit Office’s report which said the ESFA has ‘limited assurance the 20 per cent off-the-job-training rule is being complied with, and that it “does not yet have an effective way of identifying where apprentices are routinely receiving less training than they should”.

On the same day the National Audit Office revealed the government has “limited assurance” the 20 per cent off-the-job-training rule is being complied with, Ofsted has accused a provider of failing to ensure the entitlement is being met.

Meg Hillier MP and chair of the public accounts committee also hit out today saying it was “concerning” that the “Education and Skills Education can’t be sure that apprentices are spending enough time on off-the-job training”.

Ofsted’s findings mean the provider, Catalyst Learning and Development Limited, will be banned from starting any new apprentices until achieving at least a grade three in a full inspection, in accordance with ESFA intervention rules.

These apprentices are not on track to complete within their original planned timescales

In its first monitoring visit to the Enfield-based provider, the regulator rated Catalyst’s apprenticeship provision ‘insufficient’ across the board.

Inspectors found that leaders have not ensured all employers “understand and apply the commitment required for off-the-job training for apprentices”.

As a result, this entitlement is not being met for “too many apprentices”.

The controversial rule requires all apprentices to spend the equivalent of one day a week on activities relating to their course but which are different from their normal working duties.

According to Ofsted, managers at Catalyst are failing to monitor closely the hours apprentices have to study off-the-job, relying instead on apprentices’ own records, which are “often incorrect”.

“In a few cases, employers do not allow apprentices the full entitlement. As a consequence, these apprentices are not on track to complete within their original planned timescales.”

Ofsted now carries out monitoring visits to all new apprenticeship providers funded with £5 million injection from the Department for Education.

But the chief inspector, Amanda Spielman, told FE Week in January that she “can’t turn Ofsted into a police force, I’m not resourced and I don’t have the skills; and I do not think it will be a helpful thing to turn Ofsted into an investigation service, turning up to try and find any possible way integrity has been damaged”.

And an investigation by this newspaper revealed earlier this year that apprenticeships failing to comply with this provision will be “ineligible and all funding would be recovered”.

But an FE Week survey in March last year found that the sector considered the off-the-job training rule to be the single biggest barrier to apprenticeship recruitment. It is considered to be a particular issue for smaller companies who claim they can’t afford to let apprentices spend a fifth of their time away from work.

Catalyst, which specialises in commercial programmes in leadership and management, gained a contract to provide apprenticeships and started training in September 2017. It currently has 98 apprentices, all over the age of 18 years.

During last month’s monitoring visit, inspectors also found the provider does not take account of prior learning of apprentices.

While staff assess apprentices’ prior knowledge, skills and behaviours accurately using personality profiling methods at the start of the programme, they do not use this information to adjust the content and duration of an individual’s programme.

This means experienced managers are being forced to complete all the modules of a leadership and management diploma over the same length of time as less experienced apprentices, resulting in “many making slow progress, given their prior knowledge and skills”.

Ofsted also said leaders and managers do not routinely check how many planned reviews and coaching sessions take place, nor do they track apprentices’ attendance at monthly training sessions. As a result, they “do not identify quickly enough when apprentices fall behind”.

Leaders and managers at Catalyst were accused of not creating a culture of safeguarding apprentices, placing instead much of the responsibility on employers.

However, the regulator said a new management database to improve communications is now in place and is starting to have a positive impact, and welcomed directors’ “strong vision and ambition to provide high-quality apprenticeship training”.

“They have an extensive track record in commercial training and have been very effective in attracting high profile, levy-paying employers to the apprenticeship programme. The apprenticeship standards match the professional development needs of employers very well.”

Coaches and trainers were also found to have “considerable experience” and to be “occupationally competent”.

Catalyst declined to comment.

Nearly 80 of the UK’s most skilled young people are battling it out in a five-day competition this week that will decide if they get to represent the nation at WorldSkills Kazan 2019.

The squad of apprentices and learners have travelled to colleges all over the country for the team selection event.

The 40 best performers from across 36 skills will win a spot at the next WorldSkills competition in Kazan, Russia in August.

Dubbed as the ‘Olympics of skills’, WorldSkills brings together learners from around the globe, who compete in tests of their technical skills in areas such as landscape gardening, electrical installation, beauty therapy and jewellery.

FE Week went along to one of the Team UK selection events in Nottingham to see how the competitors are faring, and was joined by the Education and Skills Funding Agency’s director of employer engagement and the UK’s new official delegate, Sue Husband.

“I’m always impressed by these competitions, seeing all those individuals putting themselves out there,” she said.

“I’d find it quite challenging not just competing against colleagues from college and other colleges, but against people from as far as Russia. The standard of the work they are delivering is so impressive.”

All the competitors at World Skills Kazan 2019 will have to complete 22 hours of competition over four days.

For most of the competitors, the projects they will have to complete in Russia will be released before they get there; but when they arrive at Kazan, 30 per cent of the project will be changed.

Some competitions, such as cooking, have completely blind tests.

Beforehand though, the competitors have to go through a boot camp at Loughborough University, where they are trained by 2012 Olympian Peter Bakare and John Walton, who was part of the training team for Team GB.

Competitors are taught how to diet, exercise and sleep to get them in prime condition and then each morning in Kazan, the competitors will have to be up at 6.30 for Yoga and stretching.

Someone who knows what it’s like to prepare for the competition is Daryl Head, who won silver for the UK in the car painting competition at the 2017 competition in Abu Dhabi, and is now a judge of the UK team selection.

“It was pretty intense,” he told FE Week. “There was a strict plan we were following.”

Asked how he brought his technical skills up to a competition level, he said: “Repetition. Find out what you’re weak at and work on those areas.”

The training manager for the painting team, Richard Wheeler, said of the 2019 candidates: “Over the period of 18 months, I have been training these guys up in frequent intervals. They will obviously go away, practice, and their skill set will get better.”

There are two people competing for a place on the UK team and Wheeler said it would be difficult to choose between them.

“It’s going to come down to their interpersonal skills, time management problem-solving and how they deal with pressure.”

The two car painting competitors, and the rest of the candidates, will find out if they have made the UK team going to Kazan at Loughborough University on Sunday.

The 45th WorldSkills event will take place from August 22 to 27.

At the last WorldSkills, which took place two years ago in Abu Dhabi, saw Team UK retain its top-10 position, after our competitors bagged one gold, three silvers, three bronzes, and 13 medallions of excellence.

FE Week is proud to be the official media partner for WorldSkills UK and Team UK. FE Week will bring you all the latest developments in the lead up to WorldSkills 2019 and will be onsite in Kazan to bring rolling coverage of Team UK’s progress.

There is “clear risk” that the apprenticeship programme is not financially sustainable after the average cost of training an apprentice hit double what the government predicted, the National Audit Office has warned.

The concerning message came in a critical report published today, which said the Department for Education should assess making controversial decisions about reducing the level of public funding for certain types of apprenticeship.

In December, the Institute for Apprenticeships and Technical Education estimated that the apprenticeships budget for England could be overspent by £0.5 billion this year, rising to £1.5 billion during 2021/22.

Spending on the programme could rise to more than £3bn once frameworks are withdrawn

The problem – which comes despite the volume of starts dipping – is the result of higher per-start funding than first predicted, largely driven by the sharp rise in management apprenticeships with high prices, which FE Week was first to warn of in 2016.

Today’s National Audit Office (NAO) report confirms that employers are developing and choosing more expensive apprenticeship standards at higher levels than was expected, which is “absorbing” the public funding.

“The department has calculated that the average cost of training an apprentice on a standard at the end of 2017-18 was around £9,000 – approximately double the cost allowed for when budgets were set in 2015,” it said.

“The department projects that, even if starts remain at current levels, spending on the programme could rise to more than £3 billion once frameworks are withdrawn and all apprenticeships are on standards.”

The NAO said the DfE “recognises” there are ways in which it could seek to control spending if necessary. However, these are “likely to be unpopular and could damage confidence in the programme”.

Options, according to the report, could include: capping the spending of levy‑paying employers; limiting the number of apprenticeships available for non‑levy paying employers; and lowering the funding bands, as the DfE has already started doing through its controversial funding band reviews.

Last month, FE Week revealed that the non-levy funding for providers to train apprentices from small businesses had already started to run dry and some were having to turn apprentices away, but the government has no cash left in the system to ease the situation.

In December, Ofsted chief inspector Amanda Spielman raised concerns about graduate scheme rebadging, where levy funds are being spent on higher level apprenticeships at the expense of young people on lower levels.

Just days later, during an interview with Association of Colleges chief executive David Hughes, skills minister Anne Milton said she would “look at whether it is right” for the government to “continue to fund all apprenticeships”.

Today’s NAO report again warned that levy-paying employers are replacing their professional development programmes – for example, graduate training schemes in accountancy or advanced courses in management – with apprenticeships.

“In such cases, there is a risk that the additional value of the apprenticeship to the economy may not be proportionate to the amount of government funding,” it said.

“There are risks that the programme is subsidising training that would have happened without government funding.”

The report concludes: “Given these concerns, the department has some way to go before it can demonstrate that the programme is achieving value for money and that resources are being used to best effect.”

Mark Dawe, chief executive of the Association of Employment and Learning Providers, said his organisation has been warning for two years that higher level apprenticeships offered by the levy payers would “consume the levy to a much greater degree than the government anticipated but no notice was taken”.

He added that the NAO’s overspend figures “confirm why a separate budget is needed for SMEs’ apprenticeships”.

Meg Hillier MP, chair of the influential Public Accounts Committee, said she will hold a hearing on March 25 to quiz the DfE’s permanent secretary, Jonathan Slater, on the apprenticeships programme following the NAO’s report.

Milton said: “The apprenticeship programme gives employers the opportunity to provide new and existing staff with a range of opportunities to gain skills in the workplace and makes sure we have long term investment in apprenticeships.

“The number of people starting training on our new employer designed standards is rising year on year and we will continue to work with employers to help them develop their apprenticeship programmes. Apprenticeships enable people to get a great job and career, and give employers the skilled workforce they need.”

Nearly half of all colleges and schools with sixth forms have had to reduce student mental health and careers support this year due to crippling 16 to 19 government funding cuts.

The concerning finding, revealed in a new funding impact survey of 278 schools and colleges by the Sixth Form Colleges Association, is a substantial increase on what was reported last year and comes despite the government making both areas key political priorities to improve on.

The survey also found that over three quarters of respondents do not believe the amount of funding they will receive next year will be sufficient to provide the support required by disadvantaged students.

We will not be able to provide any more mental health and tutorial support

The SFCA’s research was conducted on behalf of the twelve organisations behind the Raise the Rate campaign, which is calling for the base rate for all 16 to 18 year old students to be increased from to £4,760 in the upcoming spending review, after being stuck at £4,000 for the last five years.

The association said the chancellor’s spending review is “make or break” for sixth form education.

FE Week spoke to two colleges struggling with the financial constraints to find out how they are being impacted on the ground.

Mike Hill, principal of Carmel College in Merseyside, explained that he has been forced to cut the college’s careers department and foundation learning department for students with learning difficulties down from a five-day offer to just four days.

“It has also been really difficult for us to offer permanent contract to staff in the learning support teams because funding is changing not only each year but also within the year, which means we are constantly having to let people go,” he said.

“We now have to wait for students to appear, work out the funding and reappoint people. It has been really, really challenging.”

He added: “We are almost unable to offer any extracurricular support unless students are being funded externally. Offering students anything beyond their subjects has almost come to a halt now in colleges like ours.”

Limor Feingold, director of finance at Brockenhurst College, told FE Week that his college’s funding for disadvantaged students support is set to be been reduced by £180,000, or 40 per cent, next year.

“This means we will not be able to provide any more mental health support and tutorial support than we already do even though our student numbers might be growing,” he said.

Feingold added that the college has been forced to cut wellbeing support services costs and career advice by £80,000 to meet its budget requirements this year.

The SFCA survey said the extent of cuts to student support services has been “more noticeable” overall than in the previous academic year.

It found that the number of schools and colleges that have reduced mental health support has leapt from 32 per cent to 48 per cent, employability skills from 25 per cent to 41 per cent and careers guidance from 28 per cent to 41 per cent.

A previous FE Week investigation found that colleges are increasingly sending students with serious mental health issues to accident and emergency, due to lack of other options as a result of substantial reductions in funding in other years.

Today’s funding impact survey also found that 81 per cent of schools and colleges are teaching students in larger class sizes, 68 per cent moved from a four subject A-level offer as standard to three, and 46 per cent have reduced delivery hours of individual courses.

Bill Watkin, chief executive of the Sixth Form Colleges Association said: “Today’s report makes it absolutely clear that the government must increase the funding rate for sixth form students in this year’s spending review. And this increase must go well beyond meeting the rising costs faced by schools and colleges.

“If we are to keep key subjects on the timetable, offer a wide range of extra-curricular experiences, and provide the essential support activities that our young people need and deserve, the government must raise the rate to at least £4,760 per student, per year.”

The National Audit Office has today published its report into whether the government’s apprenticeships programme is providing value for money.

It is the second report by the NAO into apprenticeships since 2016, but the first since the introduction of the levy.

FE Week has the report’s main new findings:

 

1. ESFA has ‘limited assurance’ the 20% off-the-job-training rule is being complied with

The NAO said the Education and Skills Funding Agency, in summer 2018, had just one “red risk” associated with delivery of the apprenticeship programme – that apprentices do not spend at least 20 per cent of their time doing off-the-job training.

Its report said the ESFA “does not yet have an effective way of identifying where apprentices are routinely receiving less training than they should”.

“The ESFA’s audits may identify problems, but there is scope for providers to under-deliver for some time without this being picked up,” the NAO added.

“This is an important gap in oversight, as training providers are paid as long as apprentices remain on the programme.”

 

2. DfE’s apprentice targets for under-represented groups ‘lack ambition’

The NAO said the Department for Education is “on track” to meet two of its diversity targets: the numbers of starts by black, Asian and minority ethnic (BAME) apprentices and by apprentices with a learning difficulty, disability or health problem.

However, these targets are “not stretching”.

“For example, the target for starts by BAME apprentices (11.9 per cent) is lower than the working‑age BAME population of England (14.9 per cent) and much lower than the proportion of BAME pupils at the end of key stage 4 (20.7 per cent).”

The report added that 19 per cent of working-age adults in the UK reported having a disability in 2016/17, compared with the 11.9 per cent apprentice target on learning difficulties, disabilities and health problems.

 

3. Introduction of standards has increased higher level apprenticeship starts

In 2017/18, 12.8 per cent of starts were at level 4 or above, compared with 5.3 per cent in 2015/16, a trend that “looks set to continue”, the NAO said.

The department “considers that this change will encourage the types of apprenticeship that tend to deliver more value, in terms of long-term wage return to the apprentice”, although the training for these apprenticeships “also tends to absorb more public funding”.

The report added that some levy-paying employers are replacing their professional development programmes with apprenticeships.

“In such cases, there is a risk that the additional value of the apprenticeship to the economy may not be proportionate to the amount of government funding,” the NAO warned.

 

4. Apprenticeship programme lacks productivity measure

The DfE has “improved” its performance measures but is still not transparent in how it demonstrates the impact of the programme on economic productivity, according to the NAO.

It said the department reports a “skills index” for the programme which “takes account of the impact on earnings of successfully completing an apprenticeship, which is an established way of calculating productivity gains”.

However, the department has “not set out how these calculations feed into the index, or what kind of increase in the index would constitute success”.

 

5. A third of apprentices trained by poor providers in 2017/18

Ofsted rated 58 per cent of the established providers that it inspected in 2017/18 as ‘good’ or ‘outstanding’ for their apprenticeship training, compared with 49 per cent in 2016/17, the NAO report said.

These providers were “generally training larger numbers of apprentices”, which means “around two-thirds of the apprentices recorded at the time of inspection were being trained in ‘good’ or ‘outstanding’ providers”.

Ofsted’s monitoring visits to 118 new apprenticeship provider in 2018 found that more than a fifth of them were making ‘insufficient progress’ in at least one of the areas examined.

 

6. Apprenticeship assessment arrangements need fixing

The assessment arrangements are “incomplete” for some standards, which “increases the risk that people with different and possibly inadequate skill levels may pass their apprenticeship”, the NAO said.

Its report reiterated what FE Week has been warning for years, that not all apprenticeship standards have an end-point assessment organisation in place, and many have only one.

“Stakeholders raised concerns with us that, as growing numbers of apprentices finish their apprenticeship under a standard, there may be insufficient capacity to carry out assessments, leading to unnecessary delays or inconsistency,” the NAO said.

 

7. Long-term financial sustainability of the apprenticeship programme is at ‘risk’

The NAO’s biggest warning focused on potential overspend of the apprenticeship programme.

It said there is “clear risk” that the programme will not be financially sustainable after the average cost of training an apprentice hit double what the government predicted.

Click here to read the full story.

 

Concluding the report’s findings, Amyas Morse (pictured), the head of the NAO, said: “Despite making changes to the apprenticeships programme, the department has not enticed employers to use available funds or encouraged enough potential recruits to start an apprenticeship. It has much more to do to meet its ambitions.

“If the department is serious about boosting the country’s productivity, it needs to set out clearly whether its efforts are on track to meet that aim.”

A college surviving on government bailouts faces an uncertain future after being dumped at the eleventh hour by its merger partner.

City College Southampton principal, Sarah Stannard, had already made plans to stand down before Eastleigh College pulled the plug after failing to secure government cash to support the merger.

Despite the situation, Stannard has sought to reassure students, staff and parents that it is “business as usual” and claimed the college has support from officials to continue operations.

The Department for Education said it is “working with City College Southampton to ensure learners aren’t negatively affected”.

City College Southampton, which is rated ‘requires improvement’ by Ofsted, has seen its financial health deteriorate to ‘inadequate’ in recent years.

It was relying on government cash as part of joining Eastleigh College, which is rated ‘good’ by Ofsted and is in a strong financial position, to secure its long-term future after seeing its first merger attempt with Southampton Solent University fall through in 2017, following a recommendation from the Solent Area Review.

The planned merger, which would have seen Jan Edrich, principal of Eastleigh, head up both colleges, was expected to be completed on March 31.

In September 2018 an application to the DfE’s Transaction Unit was made for an unknown amount of funding from the Restructuring Facility – a £726 million pot of cash that is used to support college mergers that closed in September.

But in a statement released by the principals of both Eastleigh and City College Southampton on Friday, it was revealed that the government rejected this bid.

The Department for Education has made clear that there will be no more long-term bailouts available to colleges following the introduction of the insolvency regime on January 31, which will allow colleges to go bust for the first time.

Eastleigh College told FE Week today that without the extra funding to support the planned merger the new college would not be financially sustainable.

City College’s accounts for 2017/18 warned that if this second merger failed, it would “require a standalone application to be approved to ensure it is able to continue operations into 2019/20”.

The accounts also state that the college has £6.1 million of loans outstanding with Santander on terms negotiated in 2009, which has 16 years remaining.

The college’s “forecast” show that one of the loan covenants will be breached, requiring the entire loan to be repaid in a single year. The accounts go on to say: “Santander has verbally stated it will not take any action on the College as it continues to work towards a merger”.

It is not known if Santander will now recall the loan following the collapse of the merger.

The City College Southampton accounts also stated that it has agreed with Santander a £500,000 ongoing overdraft facility, “however this is insufficient to cover the expected cashflow shortfall occurring during January, February and March 2019” and an application for an unknown amount of exceptional financial support from the DfE has been approved “enabling the college to continue in operation in the short term”.

They said that if the merger “does not proceed the college will need to seek additional long term funding from the ESFA in order to remain in existence in the long term”.

A DfE spokesperson said: “‎All bids for funding from the Restructuring Facility fund are assessed through a rigorous governance and approval criteria including whether a college is financially sustainable in the long term.”

Sarah Stannard, principal of City College Southampton, told FE Week today: “I’d like to reassure students, staff and parents that it’s business as usual for City College and all courses are being run as normal.

“The government has assured us that they are committed to ensuring further education provision in Southampton and we now have an opportunity to explore other options as to how the college moves forward.”

Both Eastleigh and City College declined to reveal how much funding the colleges had requested from the restructuring facility, but said the FE Commissioner has now been asked to carry out a review of the options for securing further education provision in the Southampton area.

City College Southampton teaches around 5,000 students. Its 2017/18 accounts show that its cash deficit deepened from £257,000 to £585,000, and its total comprehensive income was just £1.3 million.

The national finalists of the AAC Apprenticeship Awards 2019 were recognised and celebrated at a special reception at the Houses of Parliament today.

Around 150 people packed into the Terrace Pavilion for the event, which also coincided with the start of the 12th annual National Apprenticeship Week.

The awards event was sponsored by the chair of the education select committee Robert Halfon, who received last year’s Lifetime Achievement Award.

Addressing the finalists today, he said: “There’s a massive amount of work to be done and policy changes to be had but having an event like this isn’t just a nice event in the Houses of Commons, it is unbelievably important for apprenticeships.

“What this does is say we believe in the prestige of apprenticeships in our country. We want to build a skills nation and make sure every young person can climb the education and skills ladder of opportunity.

“All the award nominees are change makers, so thank you to all the providers and organisations who are here today.”

Mr Halfon added: “If we do this together and carry on it won’t just be a few small steps it will be a giant leap for apprentice kind.”

Managing director of FE Week publisher Lsect, and chair of the judging panel, Shane Mann, said: “The majority of you here today are individuals celebrating the very best in the apprenticeship sector in the UK.

“Today is about celebrating and recognising your achievements.”

Also speaking on stage was Mark Dawe, chief executive of the Association of Employment and Learning Providers, which co-runs the awards with FE Week.

“We’ve got the best of the best here when it comes to apprenticeships so it really does feel like a launch of National Apprenticeship Week,” he said.

“This is what it’s about. It’s about celebrating providers and recognising their excellence.”

More than 350 entries were submitted from colleges, training providers and employers for the awards, which are in their second year and run by FE Week and the Association of Education and Learning Providers.

Andy Bates, chief financial officer at Gloucestershire College, up for outstanding contribution award at #Apprenticeshipawards19 tells us how excited he is to be here today pic.twitter.com/To6y7hkQGw

— FE Week (@FEWeek) March 4, 2019

There are now two types of awards: Route Apprenticeship Provider of the Year and National Awards.

The former will celebrate excellence in 13 individual apprenticeship routes, and winners will be named ‘apprenticeship provider of the year’.

Organisers have also introduced an award to recognise employers and providers work with SEND apprentices and increasing diversity.

@RemitSueP tells us how great it has been to celebrate Remit’s nomination as SEND apprenticeship champion at #apprenticeshipawards19 pic.twitter.com/RJmpfNFZYe

— FE Week (@FEWeek) March 4, 2019

Winners of all awards will be announced at a glittering ceremony during the Annual Apprenticeship Conference Gala Dinner on March 28 at the ICC in Birmingham.

The awards are part of the Annual Apprenticeship Conference, which is run in partnership with the Department for Education and will take place from 27 to 28 March at Birmingham’s ICC.

Pictured: Representatives from In-Comm, Gen2 and Abingdon and Witney College receive their finalist certificate

 

AAC Apprenticeship Awards 2019 shortlist (click here to enlarge)

The Department for Education has today ruled out demands for employers to be given more time to spend their apprenticeship levy funds.

The decision comes as the 24 month deadline approaches in May and after the Institute for Apprenticeships and Technical Education warned there could be an imminent levy overspend.

In its ‘Nursing degree apprenticeships – in poor health’ report, the education select committee recommended that the government should double the time employers have to spend their levy funds to 48 months, as this would allow the NHS to develop more apprenticeship standards to train apprentices on.

The DfE responded today and explained that the 24 month expiry period for apprenticeship funds was “set at the time” the levy was developed and launched in May 2017, “having been extended from 18 months in response to employer feedback”.

The funds expire on a monthly, “first in first out” basis, meaning NHS employers will only see one month’s worth of funds expire in May 2019 if they have not spent these funds in the previous 24 months.

The response then said the DfE has “no plans” to extend this expiry period, “which was agreed with HM Treasury in order to support the Department for Education to manage its budgets and limit financial liability should vast amounts of funding remain sitting unused in employers’ accounts”.

In November, FE Week revealed that the Institute for Apprenticeships and Technical Education estimated there could be a £500 million overspend on the apprenticeship budget in 2018/19.

When quizzed about this in January by FE Week, skills minister Anne Milton said she “thinks” the apprenticeship budget will be “alright until July”.

The warning of a levy overspend came just before training providers began reporting that they were having to turn small employers away as their non-levy funding has run dry and the government has no more to dish out.

The issue, which one sector leader described as “market failure”, came just weeks after the Department for Education launched a new campaign to drive up the number of apprenticeships in England.

The concern over a levy overspend is expected to feature in the National Audit Office’s report into whether the apprenticeship programme is offering value for money, which will be published on Wednesday in the middle of National Apprenticeship Week.