Summary of Apprenticeship Levy & Funding Reforms – What is Changing and When
Name & Purpose: Apprenticeship Levy → Growth & Skills Levy
- From April/August 2026, the existing Apprenticeship Levy will be re-branded and re-worked as the Growth & Skills Levy — widening the range of training it can fund
- *In-development* Employers will be able to spend funds on shorter, modular “apprenticeship units” as well as traditional apprenticeships
Timing: Key Implementation Dates
Immediate / Already in Effect
- Small and medium sized employers (non-levy payers) now receive 100% government funding for apprentices aged under 25 — removing any co-investment contribution
August 2025
- New apprenticeship funding rules apply to all new starts, including:
- Up to £2,000 employer incentive for eligible foundation apprenticeships
- Foundation apprenticeships launch for 16–21-year-olds (and some 22–24-year-olds with EHCP/care leavers)
January 2026 – Funding Focus Shifts
- Funding support for Level 7 (master’s-level) apprenticeships changes:
- Government funding for new Level 7 apprentices aged 22 or older will be withdrawn from 1 January 2026, except for:
- those aged 16–21,
- care leavers or those with an Education, Health & Care Plan (EHCP) under 25
- Government funding for new Level 7 apprentices aged 22 or older will be withdrawn from 1 January 2026, except for:
- Existing Level 7 apprentices started before January 2026 continue to be funded to completion
Mitigation Funding
- A targeting mitigation fund was introduced to help maintain continuity of Level 7 apprenticeship access in specified healthcare professions
- Advanced Clinical Practitioner
- Specialist Community Public Health Nurse
- District Nurse (Community Specialist Practice)
- Clinical Associate in Psychology
- Population Health Intelligence Specialist
April 2026
- Apprentice minimum wage increase: rises to around £8/hour (affects all employers and apprentices)
From August 2026
The major Growth & Skills Levy reforms are expected to apply broadly from this point:
- Shorter apprenticeship units become available – Employers can use funds for modular training outside full apprenticeships
- Levy funds will expire after 12 months, down from 24 months
- 10% government top-up removed — Employers will only have access to the money they pay in
- Higher co-investment once levy funds are exhausted — Employers pay 25% of training costs (from a previously more generous structure)
Other Important Changes
- Relaxed English & Maths requirements for apprentices aged 19+, giving employers more flexibility
- No requirement to extend apprenticeships for part-time learners, simplifying planning for employers
High-Level Rationale
The broad thrust of reforms is to:
- Refocus levy spending toward younger and early-career talent
- Expand modular and flexible training pathways
- Improve value for money by adjusting funding incentives and timing rules



