Apprenticeship funding rules August 2021 to July 2022 

The 2021 to 2022 funding rules apply to apprenticeships starting between 1 August 2021 and 31 July 2022.

View the funding rules in PDF format for:

Summary of changes

Introduction

  1. This document sets out amendments to the following documents:
  • Apprenticeship funding rules and guidance for employers August 2020 to July 2021 version 5
  • Apprenticeship funding rules for employer-providers August 2020 to July 2021 version 5
  • Apprenticeship funding rules for training providers August 2020 to July 2021 version 5
  1. The funding rules form part of the terms and conditions for the use of funds in an employer’s apprenticeship service account or for government-employer co-investment. You must read them in conjunction with your funding agreement with the Secretary of State for Education (acting through the Education and Skills Funding Agency (the ESFA), an executive agency of the Department for Education).
  1. These rules will apply to all apprenticeship programmes starting on or after 1 August
  1. We have identified the rules in the 2021 to 2022 funding rules clarification version that have changed from the 2020 to 2021 funding rules in the table below. The employer, employer-provider and provider paragraph numbers are denoted with the prefix E, EP or P
  1. This document is intended as a summary and does not replace the funding rules You should refer to the main funding rules document for the definitive rules.

Summary Note:

On 2 July 2021, we published a clarification version of the 2021 to 2022 funding rules. Along with that version of the rules we also published a summary of changes, to make it easy to identify the differences between the 2020 to 2021 and the 2021 to 2022 rules.

We published a clarification version to provide the sector with an opportunity to feedback on any areas of the 2021 to 2022 rules that we could make even clearer before the final version was issued. We have now published version 1 of the 2021 to 2022 rules and this summary of changes includes the additional amends that have been made following the clarification exercise.

Learning Support funding

We received significant feedback about the changes we had proposed to the Learning Support section of the rules and accepted that there were further changes we needed to make for Version 1. We have therefore undertaken a thorough review of this section and have worked closely with provider representatives and other stakeholders. We advise that you read this whole section, as we have restructured this section and have made it clearer about what learning support can be used for and the evidence that is required to support your claims.

Apprenticeship Funding: Eligible Costs Review:

We undertook a consultation earlier this year on the eligible and ineligible costs of training and on-programme assessment. We would like to thank the sector for responding so positively to the consultation which received 78 responses. We are considering our response to the consultation and any potential changes to eligible and ineligible costs as part of the Government’s planned spending review in 2021. We will provide a further update towards the end of the year.

Terminology:

New rule:

  • We use this term to describe new rules that are developed in line with new policy, changes to existing policy, or changes to operational processes. The term describes new actions we expect a relevant individual or organisation to undertake in order to be compliant.

Clarification:

  • We use this term to describe the rewording of existing rules for ease of understanding or for the inclusion of a rule that explicitly states, reinforces or emphasises the implicit actions that should already be taken in order to be compliant with the entirety of the funding rules.

Restructure:

  • We use this term to describe areas where we have moved rules for ease of

New content:

  • We are introducing new tools to help articulate the We will use this term to confirm when we have added something new.

Summary of Changes.

Section

Change

Paragraph number

Introduction and purpose of the document

Clarification: To remove reference to the Functional Skills Qualifications temporary flexibilities which have now ended.

P13 EP13

E8

 

Clarification: To reflect that the rules on changing to a new version of a standard will apply irrespective of the apprentice’s start date and will include existing learners who started their apprenticeship programme in previous funding years.

New for version 1 P13

EP13 E8

What is an

Clarification: To be clear who is ultimately

P22

apprenticeship?

responsible for on- and off-the-job training.

EP21

   

E15

 

Clarification: Improved clarity around the role of

P23

 

initial assessment in verifying the eligibility of the

EP22

 

individual and suitability of the programme for funding.

E16

Apprenticeship

Clarification: Section reformatted.

P27

agreement

 

EP26

(between the employer and the apprentice)

 

E20

Clarification: Clarity on the ILR field name and it’s link to the apprenticeship agreement.

P27.2

EP26.2

   

E20.2

Alternative

Clarification: To be clear on the provider’s

P28

English

responsibility in relation to the apprenticeship

EP27

apprenticeship

agreement.

E21

 

Text relating to the previous redundancy policy has

P-

 

been removed

EP-

   

E-

Apprentice

Clarification: Added clarity on the provider’s role.

P30

Wages

 

EP29

   

E23

Minimum duration and employment hours

Clarification: Subtitle changed to clarify that there is no ‘exception’ to the minimum duration, rather there are circumstances where multiple periods of learning can be added together to comply with the requirement.

P39 EP38 E32

 

 

New rule: Sub-rule added to support standards versioning.

P39.2

EP38.2 E32.2

Off-the-job

Clarification: To be clear that off-the-job training

P41.1

training

should only be delivered in the practical period.

EP40.1

   

E34.1

 

Clarification: To include references to alternative

P44.2

 

delivery methodologies.

EP43.2

   

E37.2

 

Clarification: To be clear that apprentices must be

P44.3

 

engaged in active learning or on a break in learning

EP43.3

 

(if inactive for 4 weeks or more).

E37.3

 

Clarification: To be clear that off-the-job training

P45.4

 

should only be delivered in the practical period.

EP44.4

   

E38.4

 

Clarification: To be clear that the delivery of off-

P52.1/52.2

 

the-job training within the practical period requires

EP51.1 / 51.2

 

a first day and a last day of learning.

E45.1 and E45.2

 

Clarification: Added clarity around breaks in

P54

 

learning and the impact on off-the-job training.

EP53

   

E47

 

New rule: Where a signed summary statement is

New for version 1

 

required, this should be completed and signed by

P57.2

 

the relevant parties, and made available as part of the evidence pack, within 12 weeks of the apprentice completing their apprenticeship.

EP56.2 E50.2

Recognition of

Clarification: To clarify that the individual’s prior

P59

prior learning

learning and experience must be assessed through

EP59

and experience

a robust Initial Assessment before starting the apprenticeship.

E-

 

Clarification: To specify which knowledge, skills

P59

 

and behaviours must be included in the Initial

EP59

 

Assessment.

E-

 

Clarification: To reflect that prior work experience,

P60

 

particularly where the apprentice is an existing

EP60

 

employee, or is beginning their apprenticeship after

completing another programme with a relevant

E54.1

 

work placement, must be reflected in the appraisal

 
 

of knowledge, skills and behaviours.

 

 

 

Clarification: To clarify where the content, duration

P61

and price must be reduced where the individual has

EP61

prior learning necessary to achieve occupational

competence.

E-

Who can be

Clarification: To be clear that we are referencing

P68.3

funded?

eligible training costs.

EP68.3

   

E59.3

Individuals who are not eligible for funding

Clarification: The Ministry of Justice provides that prisoners, both in custody and released on temporary license, cannot sign a contract of employment. Therefore, the rules have been updated to clarify that prisoners are not eligible apprentices.

P81 EP81 E70

Apprentices who need access to learning support

Following consultation with provider representatives and other stakeholders, we have substantially amended this section.

New for version 1 P82 to P91

EP82 to EP91 E71 to E72

Eligible costs

Clarification: To be clear that EPA costs must not

P104.1

 

be included in the TNP1 price on the ILR.

EP97.1

   

E84.1

Incentive

Text relating to incentive payments for

P-

payments for

hiring a new apprentice from 1 August 2020

EP-

hiring a new

apprentice from

to 31 May 2021 has been removed as

these no longer apply.

E-

1 April 2020 to

30 September

2021

   

New rule: To reflect that where you apply for an incentive payment in the same month as being eligible to be paid an instalment, you must apply by

the 15th day of the month. Where you claim after

P- EP126 E112

 

this date, payment of your instalment will be

 
 

delayed by a month to allow for necessary payment

 
 

checks.

 
 

Clarification: To confirm that it is the employer’s

New for version 1

 

responsibility to claim the incentive payment on the

P-

 

apprenticeship service for each eligible apprentice.

EP120

   

E106

 

Clarification: To reflect that where you apply for

New for version 1

 

an incentive payment in the same month as being

P-

 

eligible to be paid an instalment, payment of your instalment may be delayed by a month to allow for necessary payment checks.

EP126 E112

 

Support for

Restructure and clarification: To reflect that

P133.1 and

English and

these rules apply to all apprentices.

P133.2

maths training

 

EP140.1 and

   

140.2

   

E129.1 and

   

E129.2

 

Restructure, and clarification on self-

P147.1

 

assessment.

EP154.1

   

E144

 

New rule: The box highlights that the suspension

P-

 

of the rule requiring level 2 apprentices to study

EP-

 

towards, and attempt, the functional skills

assessments at level 2 has been extended to

E-

 

include level 2 apprentices with a planned end date

 
 

on or before 31 December 2021.

 
 

Clarification: The box highlights that the rule

New for version 1

 

requiring level 2 apprentices to study towards, and

P-

 

attempt, the functional skills assessment at level 2 is temporarily suspended. Apprentices who are due

to take their EPA on or before 31 December 2021

EP-

E-

 

must be passed through gateway to sit their EPA

 
 

without the need to attempt the level 2 functional

 
 

skills English and maths assessment. Providers

 
 

must retain evidence if an apprentice did not take

 
 

the level 2 assessments due to coronavirus

 
 

(COVID-19). For apprentices on a standard, this

 
 

means they must be at gateway on or before 31

 
 

December 2021. For apprentices on a framework,

 
 

they must have achieved all of the requirements of

 
 

the framework by 31 December 2021.

 
 

Clarification: To confirm the requirements for level

New for version 1

 

3 and above apprenticeships where a level 2

P140

 

qualification in English and maths is required, and the apprentice does not already hold the acceptable qualifications.

EP147 E136

End-Point Assessments

Clarification: To remove reference to the Functional Skills Qualifications temporary flexibilities which have now ended.

P-

EP-

E-

 

New rule: To reflect that dialogue with the end- point assessment organisation must commence at least 6 months before the planned end date of the apprenticeship.

P157 EP164 E154

 

 

New rule: To reflect that the employer must both

P159

select and negotiate the price with the EPAO at

EP166

least 6 months before the apprentice reaches the

gateway.

E156

Contracting and

Clarification: The reference to new non-levy starts

P167

subcontracting

being funded via a contract for services has been

EP-

 

removed.

E-

 

Clarification: Further clarification on what is meant

P169

by “the employer’s apprenticeship programme” and

EP175

additional examples of what would constitute a

“token amount” are provided.

E164

 

Clarification: Additional information relating to the

P171

Public Contracts Regulations 2015 is provided.

EP178

 

E-

 

New rule: To be clear that artificial distinctions or

P172

convoluted delivery arrangements must not be

EP179

used to avoid the application of the subcontracting

rules.

E-

 

New rule: To be clear subcontracting must not be

P173

used to meet short-term funding objectives.

EP180

 

E166

 

New rule: To be clear on the rationale for

P-

subcontracting

EP181

(NB Existing rule for main providers, now expanded

E-

to include employer-providers).

 
 

Clarification: That a main provider can use delivery subcontractors to complement their own delivery and these delivery subcontractors can deliver full or part-apprenticeship training.

P-

EP- E171

(NB Existing rule but only previously included in the main provider / employer-provider rules).

 
 

Clarification: That a main provider must maintain the relationship with the employer at all times. The main provider must not allow a delivery subcontractor to lead that relationship.

P-

EP- E175

(NB Existing rule but only previously included in the main provider / employer-provider rules).

 
 

New rules: To describe the additional information that must be published alongside the

P175-P178 EP-

 

 

subcontracting rationale.

E-

 

New rule: That the ESFA will reserve the right to require an explanation where the funding retained as a management fee for a subcontract exceeds 20% of the overall contract but offers little value.

P177 EP182 E-

 

New rule: That delivery subcontractors must not be used without the appropriate knowledge, skills, and experience of contracting with, and managing, delivery subcontractors.

(NB Existing rule for main providers, now expanded to include employer-providers).

P- EP185 E-

 

New rule: To be clear that learners supported through subcontracting should fully understand the roles and responsibilities of the various parties.

P187 EP190

E-

 

New rule: To be clear who is responsible for the actions of subcontractors including who is responsible for making alternative delivery arrangements, protecting the audit trail, and / or repaying ESFA when a subcontractor fails to deliver.

P190 EP191 E178-E180

 

New rule: To be clear who is responsible for ensuring safeguarding is rigorously enforced in subcontracting arrangements.

P192

EP193 E-

 

New rule: To be clear that it is not acceptable for any staff member with a direct or indirect financial interest in a subcontractor to undertake any management control activities of that subcontractor.

P193 EP194 E-

 

New rule: To outline responsibilities in relation to the Prevent duty.

P196 EP197

E-

 

New rule: That an employer-provider must not enter into any agreement for brokerage.

(NB Existing rule for main providers, now expanded to include employer-providers).

P- EP199 E-

 

Clarification: To be clear that the written contract with a subcontractor must be in place before any delivery takes place.

P199 EP200

E-

 

 

New rules and clarifications: The section has been updated to be clear on what, as a minimum, must be included within the contract with the delivery subcontractor.

P200-P210 EP201-EP211 E-

 

New section: To outline the subcontracting threshold and exemption cases process.

New for version 1 P211 to P212 EP211 to EP215

E-

 

New section: To summarise all of the rules relating to subcontracting reporting and external audit requirements.

P213-P217 EP216-EP220

E-

 

New rule: To change the relevant dates from a financial year to an academic year, to align with the subcontractor declarations.

P220 EP221

E-

When payments are made

Clarification: To reflect changes made in the co- investment section.

P232 EP-

E-

Employer co- investment

Clarification: To reflect that we may withhold the final completion payment until all the necessary employer co-investment has been collected.

P247 EP-

E-194

Clarification: To reflect that you must have collected and recorded (on the ILR) at least the amount of co-investment required for the whole programme up to the month before the completion payment is due, not counting any co-investment which might be required for the completion element itself.

P247.3 EP-

E-

Clarification: To reflect that throughout the financial year you should regularly have collected matching co-investment from employers.

P249 EP-

E-

Clarification: To reflect that throughout the financial year you should regularly have collected matching co-investment from employers and that for any change of circumstances, the co-investment is reconciled and any overpayment addressed.

New for version 1 P246

EP-

E-

Clarification: Employers may agree a schedule of co-investment payments with the main provider, which does not match payments made by us each month.

P-

EP- E193

 

Subsidy control

New Rules: Section updated to reflect new Subsidy Control rules.

P269 to P272

EP271 to EP274 E230 to E233

Apprenticeships funded by transfer of levy funds

Clarification: updates to reflect the upcoming launch of the online matching service.

P-

EP282, EP286

and EP298

E241, E245 and E258

Clarification: updated to reflect the rules within the Employer Funding Rules around what happens a transfer payment fails.

P-

EP300 E-

Clarification: updated to reflect the rules within the Employer Funding Rules around monitoring process.

P- EP301

E-

Change of circumstance

New rule: To reflect where there is a change to the apprentice’s programme (including changing to a new version of a standard).

P287.1 EP307.1

E265.1

Breaks in learning

The flowchart has been updated and moved to a new position in the document to follow the text on breaks in learning.

P-

EP-

E-

Redundancy

-     Text related to the previous redundancy policy has been deleted.

P-

EP-

E-

-     The flowchart has been updated.

P-

EP-

E-

Maternity, adoption and shared parental leave

Clarification: To reflect that a break in learning must be used where the individual has agreed, with their employer and provider, to take a break of 4 weeks or more from their apprenticeship (with or without a break from work) but plans to return to the programme in the future.

P310.1 EP329.1 E284.1

Changing to a new version of a standard

New rules: For when an existing apprentice wishes to move to a different version of the same standard.

P314 to 327 EP333 to EP346

E288 to E298

Clarification: To reflect that the availability of an end-point assessment organisation must be considered before enabling an apprentice to move versions.

New for version 1

P315 and P320

to P322

 

   

EP334 and EP339 to EP341

E289 and E294

Evidence Pack (Programme Eligibility)

New rules: To reflect the evidence requirements for initial assessment.

P360.1 EP368.1

E-

Evidence Pack (Recognition of prior learning)

Clarification: To reflect evidence requirements for recognition of prior learning.

P366 EP374

E-

Clarification: We have made revisions to aid further clarity.

New for version 1 P366.4

EP374.4 E-

Evidence Pack

(Commitment Statement)

Clarification: to reflect the evidence requirements for progress reviews.

P367.3 EP375.3 E-

Evidence Pack (apprentices accessing learning support)

Following consultation with provider representatives and other stakeholders, we have substantially amended this section.

New for Version 1 P370

EP378 E-

Evidence Pack (Support for English and maths)

Clarification: To remove reference to the Functional Skills Qualifications temporary flexibilities which have now ended.

P-

EP-

E-

Evidence Pack (Paying for an apprenticeship)

New: Requirement to hold information on who the sending employer is for transfer funded apprenticeships.

P376

EP382.5 E-

Annex A: Eligibility criteria (who we fund)

Update: Changes to ordinary residence criteria for UK nationals.

P389

EP395 E323

Update: Changes to ordinary residence criteria for citizens with the Right of Abode.

P390 EP396

E324

New Rule: A new residency category has been added for UK nationals who have been living in the EEA.

P391

EP397 E325

New Rule: A new residency category has been added for EEA nationals in the UK (this replaces

P392 to P393

EP398 to EP399

 

 

the EEA citizens section).

E326 to E327

New Rule: A new residency category has been added for Non UK nationals (this replaces the Non EEA citizens section).

P394

EP400 E328

New Rule: A new residency category has been added for family members of UK and EEA nationals (this replaces the family members of EEA nationals section)

P395 to P396 EP402 to EP403 E329 to E30

New Rule: A new residency category which is exempt from the three year residency rule has been added.

P398.7 EP404.7

E332.7

New Rule: New rules have been added to explain which family members of nationals with Calais Leave to remain under section 67 can be eligible for funding.

P399 to P400 EP405 to EP406 E333 to E334

Update: Updates to the Child of a Turkish Worker section to reflect end date of agreement.

P404 EP410

E338

Update: Updates to the list of British Overseas Territories and EEA Countries we use for establishing eligibility.

P413 to P416 EP420 to EP423

E348 to E351

Glossary

New content: New terms have been added to the glossary.

New for version 1

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