Changes as a result of the recent budget
The government’s November budget included some major apprenticeship funding changes from 1 August 2026.
Apprenticeship Age Limit Changes
· Free apprenticeship training will be available to anyone under the age of 25. This applies to small and medium sized employers.
Funding Changes
· Levy funds for any employer who pays in to it, will see a reduced timeframe from 24 months to 12 months.
· For levy employers, the contribution will rise from 5% to 25%.
· The government will also no longer top up levy funds by 10%.
Changes such as these will require employers to plan how their Levy funds are used to ensure they can be used within the 12 month timeframe working alongside Training providers such as Peak, who will be looking on how we can provide the same quality service.
Incentive payment for employers who do no pay the levy
From October 2026, the government are introducing an incentive of up to £2,000 for non-levy paying employers that take on 16-24 year old apprentices as new employees. This forms part of wider reforms aimed at reversing the decline in young apprenticeship starts, creating more apprenticeship opportunities for young people, and the expansion of the Youth Guarantee.
It will apply to apprenticeship starts from October (as long as they have joined their employer within the past 3 months, e.g. from July 2026), the first payment will be made once the learner has completed their first 90 days on the apprenticeship.