Funding band allocation and funding policy

Trailblazers expressed concern that initial funding bands might actually discourage providers and employers.

In February 2018, the Institute implemented a range of changes to our processes. This included responding to feedback from Trailblazer groups who felt the Institute required detailed quote information too early in the process. To help address this, we moved to an initial funding band, which is generated much earlier in the process  - when a proposal for a new apprenticeship standard is approved and a final funding band recommendation when the EPA plan is approved. Funding evidence forms only need to be submitted once, and our processes are faster than they used to be.

Initial funding bands are calculated based on the typical duration of the apprenticeship standard; an assumption that an apprentice spends 20% of their time in off-the-job training; the sector subject area of the training, and an allowance for EPA.

We know that initial funding bands aren’t working for everyone at the moment, and that some Trailblazers are frustrated by the initial allocation. We’re looking into how they might be refined, including what additional data sources we might be able to use for this.

Trailblazers queried the role of the Route Panels in decisions around funding. Route Panels do not approve initial funding bands – these are based on a calculation that does not require Panel sign off. However, initial funding bands are presented as part of the evidence when Route Panels are considering final funding bands, and we explain the data used to generate it.

Trailblazers expressed concern about the difficulty of sourcing accurate cost projections from Higher Education Institutes (HEIs). The Institute does not apply a single funding band to a single type of apprenticeship, but we assess each apprenticeship individually. This means that when Trailblazers are gathering quotes from training providers as part of the approval process, it is important that apprenticeship training providers provide the detail behind those quotes, including those offering apprenticeships at Level 6 such as degree apprenticeships. We have recently met with a number of HEIs, and our experience is that they are able to provide quite detailed cost information.

For newly submitted standards, we make final funding band recommendations based on a range of factors where available, including:

1. the evidence submitted by Trailblazers, taking into account only those costs which are eligible for public funding according to the existing funding rules
2. the cost and funding bands of any equivalent apprenticeship frameworks
3. the level and nature of the training/EPA, and consistency across similar types of apprenticeship standard
4. affordability within the wider apprenticeship programme, and other factors in the Institute’s Strategic Guidance
5. the initial funding band allocated to the apprenticeship standard at occupation proposal stage
6. the expertise of our Route Panels

This means that even if information is not available for some of the factors listed above, there will be other information available that we can use to inform our funding band recommendation. Where a Trailblazer group is struggling to obtain training provider quotes to inform the final funding band they should raise this with their Relationship Manager so we can consider possible options.

Trailblazers requested more structure and guidance around costings. We are currently reviewing the forms used to gather quotes from training providers, and we will also consider whether additional guidance can be provided.

Trailblazers asked what information Route Panels are given on funding. The Institute’s funding team review all the evidence provided to reach a funding recommendation. We provide Route Panels with the rationale and supporting evidence used to make the recommendation.

For each final funding band, Institute officials make a recommendation to the relevant Route Panel. The Panel then applies their own expertise and knowledge, and a recommendation goes forward to the Approval and Funding Committee (a sub-committee of the Institute’s Board). This final recommendation then goes to the Minister for Apprenticeships and Skills for a final decision.

In the context of concern that reviewing the funding bands for standards would compromise the quality of the apprenticeship, Trailblazers asked for clarity about the criteria on which final funding recommendations are made. The Institute is focused on developing quality standards that are appropriately funded. We make funding band recommendations for new standards using a range of factors, including:

1. the evidence submitted by Trailblazers, taking into account only those costs which are eligible for public funding according to the existing funding rules
2. the cost and funding bands of any equivalent apprenticeship frameworks
3. the level and nature of the training/EPA, and consistency across similar types of apprenticeship standard
4. affordability within the wider apprenticeship programme, and other factors in the Institute’s Strategic Guidance
5. the initial funding band allocated to the apprenticeship standard at occupation proposal stage
6. the expertise of our Route Panels

When we review the funding band of a standard that is already live for delivery, we also consider: current apprenticeship delivery cost data and current market activity and the expertise of our Provider Panel.

Trailblazers expressed concern that, when a decision was made to reduce a funding band, they received very little feedback or evidence on how the decision was made. We are currently looking at how we can be clearer with Trailblazer groups about how decisions have been made. 

Trailblazers expressed concern that, by allowing the market to drive down costs, it could impact the quality of standards. Our aim is to make funding band recommendations that support the delivery of high quality training and assessment, and ensure value for money for the employer and the taxpayer. The funding band represents the maximum government contribution, but employers are able to negotiate to secure high quality apprenticeship training that is right for them, which could be above or below the funding band.

Trailblazers asked if the funding represents the cost of delivery or a maximum government contribution. Costs of delivery will vary between cohorts. However, the funding band is the maximum government contribution towards the cost of off-the-job training, on programme assessment, and end-point assessment.