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Funding updates

February 2019 Funding update

This month’s update will cover:

  • Apprenticeship Levy Transfer news
  • Non-levy apprenticeship over-delivery
  • Register of Apprenticeship Training Providers - applications process
  • Apprenticeship Funding Band reviews
  • Advance Learner Loan - Growth Facility


Apprenticeship Levy Transfer news

ESFA have now confirmed that the amount of levy employers can transfer to other employers (levy or non-levy payers), increases from 1st April from 10% to 25%.

This was announced by the Chancellor in last year’s budget, but news on the change had gone very quiet, which had us all wondering if it was still in the mix. No news on the drop from 10% to 5% contribution for non-levy provision, so still hoping that will go ahead and we’ll hear more in March.

The increase in transfer percentage is a good opportunity as it can help more non-levy employers to deliver apprenticeships. It can also help regions working together address skills shortages in particular sectors, if employers and providers are willing to work together and plan transfer funds to other local employers to address those skills shortages with specified apprenticeships. This is happening in areas such as Manchester and is working well.


Non-Apprenticeship over delivery

ESFA have been monitoring apprenticeship delivery and have now confirmed they are able to fund over-delivery in non-levy apprenticeships from January 2018 to March 2019, including delivery that exceeds provider contract allocation.

They anticipate having enough budget to fund all over-delivery, but they’ll confirm for definite after they have carried out a due diligence process, i.e., how many providers are asking for over-delivery and how much budget have they got. If they don’t have enough budget to cover all over-delivery, they’ll write to all providers and indicate the criteria that will be used to allocate the budget available. Thus, there is some risk involved, but this is the last chance for providers to register apprenticeship starts over and above their non-levy contract value.

Any over-delivery is subject to affordability and also conditional on provider compliance with the terms of the funding rules and provider contracts, so the usual quality requirements apply.

ESFA plan to issue variations for over-delivery to R06 in February and will revisit 2018 to 2019 financial year capping again in May and November. ESFA say they will no longer fund over-delivery from 1 April 2019.


Register of Apprenticeship Training Providers - applications process

ESFA have updated the RoATP application process regarding Ofsted Inspections and have now clarified that they will accept short inspection outcomes, which is a great move forward. The inspection, which must confirm an overall grade of good, no more than 3 years prior to the application where a provider was awarded:

  • An apprenticeship grade of outstanding or good in their most recent inspection, for the purposes of question PR-1 of the application
  • An overall grade of outstanding or good in the remit of FE and Skills for the purposes of question PR-4 of the application

Important note on the re-application process: all current RoATP registered providers will be expected to re-apply by August this year and will receive an invitation from ESFA with a deadline for re-application. It’s not an option to miss that deadline. If you are unable to submit your application on time, ESFA will strike your organisation off the register 30 days later. ESFA have also asked that providers wait for the invitation to arrive before they reapply to avoid log-jams in applications their end.


Apprenticeship Standards Funding Bands reviews

The IfA have announced the downgrading in funding band for the following Apprenticeship Standard:

Standard Title

Current Band

New Band

Date of change in band

Digital and Technology Solutions Professional

£27,000 (band 30)

£25,000 (band 28)

13 May 2019


A further 30 funding bands are under review - more changes will be announced over the coming 3 to 6 months.


Advanced Learner Loans - Growth Facility

The ESFA have flagged that the growth and new facility request forms for Advanced Learner Loans are now available.

Completed request forms must be sent to:  before 5pm on Friday 1 March 2019.

Providers should submit a growth request form to be considered for an increase in your loan facility. Adult Learner Loans can be used to deliver City & Guilds Level 3 to Level 6 qualifications in our Loan Catalogue for learners over 19 years of age. This is excellent for 19+ learners who are not suitable for an apprenticeship.


Keep up to date with immediate news and funding changes

LinkedIn: Bryony Kingsland
Twitter: @BryonyKingsland


Past Funding updates

January 2019 Funding update

This update will cover:

  • We are running a webinar on 31 January about AEB Funding and devolution.
  • Adult Education Budget (AEB) eligibility rules to help you support lower paid workers and ESOL learners improve their skills
  • Devolution of the AEB and what it means for providers in devolving areas and around the rest of the country
  • The 16-19 Funding changes announced by the ESFA in December 2018.


AEB Eligibility - ESFA Flexing of Funding Rules

In 2018/19, the ESFA have made some learner eligibility changes to the Adult Education Budget (AEB). For many providers, using all the AEB allocation has been challenging in the last few years. The changes to the 2018/19 AEB funding rules allows providers to offer fully funded programmes to learners on wages of £15,736.50 or less, where previously, many of those learners would have to contribute 50% of the costs. This is a welcome opportunity to spend more of your AEB budget to support learners who may not have been able to access your courses and programmes before, whilst increasing social mobility.

The new flex also applies to ESOL learners. This is a big opportunity to increase local access to ESOL programmes. Many individuals who don’t speak or write good English remain in low paid jobs because their English skills are poor. Being low paid means they often cannot contribute towards their course costs, keeping them in a cycle of low skills/poor employment opportunities. City & Guilds has worked hard to develop an offer which best suits the specific needs of ESOL provision, supporting flexible delivery, responsive assessment and encouraging maximum learner engagement.


City & Guilds ESOL Information

The ESFA has agreed that up to 3% overspend is available in 18/19 for all providers with AEB funding agreements, if provider history shows that Ofsted grades, minimum quality standards, financial health, financial management and controls meets ESFA requirements. The 103% tolerance calculation will include non-formula funded community learning delivery, but only up to the amount set out in your funding agreement.

These new flexibilities are only available during this academic year at the moment.  ESFA and DfE will announce later in the spring if they intend to extend the flexibility into next year’s funding rules.

The new low wage flexibility rules are on pages 24 and 28 of the ESFA AEB funding rules document:

Adult Education Budget Funding Rules 2018/19 >

For more information, visit the dedicated AEB Funding page on our website.


Adult Education Budget Devolution

After a slow start, it now seems devolution of the AEB is moving towards us at terminal velocity. Whilst the opportunity for local areas to develop plans that meet local skills needs is great and much needed, there are going to be some challenges for providers that come with the new arrangements. These are the areas that are devolving:

Two further Mayoral Combined Authorities (MCA’s), North of Tyne and Sheffield City Region, devolve one year later in the 2020 to 2021 academic year, if the ESFA assesses them as ready.

All MCA’s are going out to tender to procure their adult education provision. London, Liverpool City Region and Manchester have already published their Invitations to Tender (ITT) late in 2018. Tees Valley ITT is open now, West Midlands is due to publish in January, with the remaining MCA’s due to publish ITT’s early in 2019, so it’s worth keeping an eye out on MCA websites and signing up for News Bulletins on the links above to keep track of opportunities to deliver AEB programmes in an MCA area.

Any provider with AEB funding will be affected by devolution, even those in non-devolved areas. MCA’s will fund learners with a home postcodes in their area. ESFA will fund all other learners. So providers may have a single funding agreement with a commissioning authority or multiple funding agreements covering one or more MCA’s and ESFA. Therefore, it’s important that providers understand how much of their delivery (direct and sub-contracted) is to residents of devolved areas. The new arrangements will make for some interesting boundary issues for providers. Also for learners that commute into an area, or that are close to a boundary and local provider but their postcode is outside the MCA locality.

Finally, all MCA’s are setting their own funding rules, rates and formula, and will expect a separate data return from the ESFA ILR returns. MCA’s are working with ESFA to make this this as painless as possible, but it’s likely to add some extra administrative burden if providers AEB contracts cover more than one area.


City & Guilds Support

City & Guilds provides a catalogue of our funded qualifications, which is broken down by sector subject area, level and size. This will make it easy for you to work out which qualifications support your local MCA priorities and how much funding you can draw down.

City & Guilds Qualification Catalogue >

16-18 funding changes

In December 2018, the ESFA announced a funding change resulting from their Review of 16-19 study Programmes. The funding change proposed, which would have been introduced in 2019/20 academic year, was that students with prior attainment in English and maths at Grade 4, or above that are undertaking a vocational qualification, would not be expected to be on an Entry Level or Level 1 core aim, even if they had no previous experience in the vocational area – they should undertake a core aim at L2 or above, except in exceptional circumstances.

After consultation with the sector, the ESFA have announced that they will not introduce this new funding rule but will consult further and decide whether to introduce the change in 2020/2021 instead. It’s a welcome delay to a rule that could have had a profound and potentially negative affect on learner’s progression and achievement.



City & Guilds held an AEB webinar on 31 January 2019 outlining updates on AEB developments and devolution.

Watch now


More information 

Already offering City & Guilds qualifications? Contact your dedicated Business Manager.

If you are new to City & Guilds and would like to offer our AEB funded qualifications, call our team: 01924 206709 or complete the Customer application form.