Levy Employer Opting into Co-Investment

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This topic contains 10 replies, has 4 voices, and was last updated by  Ruth CJ 1 month, 1 week ago.

Viewing 11 posts - 1 through 11 (of 11 total)
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  • Luke Burns
    Participant

    Hi all,

    Bit of a weird one – we have an employer who pays the apprenticeship levy, who has funds available, but who would prefer to use co-investment from day one, as they believe this will give them better value for money.

    Firstly, does anyone know if this is permitted under the funding rules? I couldn’t see anything explicitly saying no, but then again it seems to go against the grain of the funding system so I would have thought not.

    Secondly, if it is legit, does anyone have any pointers on how best to record this on the ILR?

    Many thanks!

     
    #421076

    Martin West
    Participant

    Hi,
    I cannot find anything in the rules that would prohibit this but as all employer will be going over to DAS funding anyway it would not be an option in the future.
    I am sure it is not an option to have some learners funded via DAS and others funded via co-investment/ESFA, the employers reasoning does not make sense.
    You would record it on the ILR as ACT 2.
    HTH

     
    #421117

    helen1
    Participant

    Sounds like they have plans for various apprenticeships which have different values but know their Levy money will run out? And this first apprenticeship attracts the lower value so therefore their ‘pounds spent’ co-investment will be lower. If they put these apprenticeships through first on the Levy then when they take on the higher valued apprentices their levy money may have run out and so would have to co-invest on the higher valued apprenticeship? (Just my musings.)

     
    #421129

    Martin West
    Participant

    That would be the best reason for not allowing employers to do it, it’s just I cannot find a rule that says so.

     
    #421131

    Luke Burns
    Participant

    Thanks both, I agree it doesn’t seem to be clearly prohibited in the rules, but definitely feels off.

    I suppose we could try putting the enrolments through using ACT 2 and see if this generates an error, with the understanding of the employer that if there are any funding issues we’ll have to switch them over to their levy.

     
    #421236

    Martin West
    Participant

    Hi Luke,
    I think you are missing the point and should not allow the employer to do this.
    Your allocation is intended for non-levy SMA’s and not levy paying employers and as such this will leave you with less funding for the employers it was intended for.
    The employer can resolve the issue for what apprentices would attract co-investment by prioritising the Apprentices in their DAS account.
    HTH

     
    #421260

    Luke Burns
    Participant

    Thanks Martin, this makes sense – I’ll let them know.

     
    #421263

    Ruth CJ
    Participant

    Agree, I would absolutely not allow this. Why should a levy paying employer be allowed to draw funds directly from the central pot when there’s a pot especially reserved for them? It’s like taking the free fruit at Tesco even though you have fruit at home that you already paid for, that you’re just going to let rot. Eat your own fruit first, and only take the publicly available fruit if you’ve run out.

    Also, how does this give them “better value for money”? If they use up their levy pot, they will end up co-funded, and expected to pay 5% of what they’re short anyway. Perhaps they don’t understand that.

     
    #421318

    helen1
    Participant

    I suspect that that they have done their sums and worked out that 5% of, for example, 5 L3 apprenticeships is less than 5% of 5 degree apprenticeships. So therefore it would be cheaper to coinvest the L3 apprenticeships.

     
    #421322

    Luke Burns
    Participant

    Eat your own fruit first

    Excellent choice of words – wish I’d seen it before I sent the email! 🙂

     
    #421333

    Ruth CJ
    Participant

    That’s a good though Helen, but it still makes no difference in the end. I honestly don’t blame employers who get this muxed ip, it’s not exactly straightforward.

    Luke – Haha! I love analogies. I use them a lot in my training, it seems to help with complex things.

     
    #421342
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