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From 1 August, the co-investment employers pay once their levy funds are exhausted rose from 5% to 25%. On a £23,000 level 3 standard, that is the difference between an employer contribution of £1,150 and one of £5,750. Multiply that across a book of levy-exhausted employers and the conversation you are about to have is not optional.
Except it is not the conversation for every employer. Days before the rate took effect, ministers partially reversed it. The new rule is that where an employer runs out of levy the 25% co-investment rate only applies to apprentices aged 25 or older on their start date, those aged 16-24 will be fully funded by the government.
Two employers running the same standard can be looking at two completely different numbers, and the only thing that decides which one applies is the age of the apprentice on the application.
If you had this conversation with an employer before that reversal landed, or if your team is still quoting the flat 25% figure, some of your employers have the wrong number. That is not a small correction. It is the kind of thing an employer's own finance team will spot before you do, and a call that corrects itself before they catch it looks very different from a call where they catch it first.
Business leaders have already told FE Week the original rise would turn firms off apprenticeships, with some warning they would cut recruitment rather than pay it. That reaction was rational before the age split was confirmed, and it is worth remembering that the direction of travel is still a tighter funding environment. DWP's own accounts plan for apprenticeship spending to fall from 2027, and the department avoided a second successive overspend only through a mid-year top-up. Employers who assume this settles down next year are planning on the wrong assumption.
So the question for every ITP managing director this week is not whether the rate changed. It is whether the number you gave each employer still matches what actually applies to their apprentice.
What the conversation needs to cover
An employer asking why their bill went up, or why it didn't, deserves three things, not a rate card. First, what actually applies to their specific apprentice when their levy runs out: the 25% co-investment rate if the apprentice is 25 or over or full funding if they are 16 to 24. Second, what it means for the account in front of you: their standard, their cohort size, their number, not a sector average. Third, and this is where most providers go quiet, what their options are on a levy account with headroom, a phased start date, or which standards deliver the best return once the price has moved.
There is a second pressure sitting under the first. New levy funds entering an employer's account from 1 August expire after 12 months, down from 24. Funds already in the account before that date keep the old 24-month window, so a single employer can now be running two expiry clocks on the same pot. An employer who does not know that is an employer who loses money they already paid for, and finds out from someone other than you.
Providers who can answer all three questions, the age-based rate, the specific number, and the levy clock, in the same call keep the relationship. Providers who are still working from the old flat-rate script lose the initiative, and on a recruitment decision that is often lost for good.
This is not a conversation to improvise per employer. It is a script: the rate that actually applies to their apprentice's age, the specific pounds and pence for their standard, the levy expiry date for their account, and the delivery options available to them. Building that script once, from data you already hold, is faster than reconstructing it employer by employer as the calls come in, and safer than working from a rate card that went out of date days after it was printed.
That data question is the same one that sits behind your ILR return. MAYTAS holds that data at the learner and employer level, validated against the rules that apply on the day, so the conversation is a lookup rather than a calculation.
300+ training providers have run their funding data through MAYTAS across 40+ years of rule changes. This one moved twice in a fortnight. The providers who treat that as a reason to check their script, not a reason to stop trusting it, will be the ones still delivering to these employers next year.
If you want to see how providers pull that data into one view, the brochure is a quick read.
