The government’s apprenticeship reforms, announced yesterday (27 May), have prompted criticism for capping the age at which older learners can access funding for high-level qualifications.
From January 2026, government funding for Level 7 (Master’s degree-level) apprenticeships will only be available for those aged 21 and under. Employers will be solely responsible for funding the training of employees aged 22 and over.
The decision follows ongoing coverage of the rising level of young people (aged 16 to 24) classified as not in education, employment or training (Neet).
Steve Horrell, the Chartered Institute of Export & International Trade’s learning services manager, described the decision as a “retrograde step”, adding that it would “fuel the myth” that apprenticeships are only for young people.
Redirecting funding
The announcement says that the government will be:
“Refocusing funding away from Level 7 (masters-level) apprenticeships from January 2026, while maintaining support for those aged 16 to 21 and existing apprentices.
“This will enable levy funding to be rebalanced towards training at lower levels, where it can have the greatest impact”.
The BBC reports that since the Apprenticeship Levy’s introduction in 2017, there’s been an uptick in Level 6 (degree level) and Level 7 apprenticeships, and a drop in the number of young learners enrolled on Level 2 (GCSE level) qualifications.
On Friday (23 May) the number of Neets stood at 923,000 people, according to the Office for National Statistics. This amounted to approximately 1 in 8 young people.
Other options
However, Horrell warns that this was unnecessary, particularly in light of the amount of unused funding generated by the levy.
“It would be far more beneficial for the apprenticeship levy transfer to be marketed more transparently and to educate employers around this area,” he says.
This included highlighting that large employers paying into the Levy “can pass 50% of their unspent funds to aid other organisations”.
“As always,” he adds, “the biggest losers will be those who currently benefit the most, SMEs and start-ups”.
The shadow education minister, Neil O'Brien, warned that ending funding for higher-level programmes will “do damage to the public services, particularly the NHS.”
“It will make it impossible for many young people who don't go university to enter the professions.”
The Apprenticeship Levy
The Apprenticeship Levy is paid by large employers with an annual wage bill exceeding £3m, with 0.5% of their wage bill paid into a digital account they can access to fund apprenticeship training.
The Levy is paid monthly, with the funds stored for two years before they “expire” – encouraging employers to ‘use it or lose it’, although larger firms have the ability to transfer funds.
Expired funds are reallocated by the government to support learners already enrolled on an apprenticeship to complete their qualification.
Horrell says that many companies simply aren’t aware that the funding is available.
Once an employer has been paid into their account for two years, payments expire each month and are replaced by a new payment. This leaves a “flat account rate” that many employers overlook.
Horrell added that:
“I understand it will save money under the premise of bridging specific skills gaps, but it will actively fuel the myth that apprenticeships are only for younger people when this is absolutely not the case”.
Additional announcements
Other changes to apprenticeship provision include the creation of 120,000 new roles, mainly in sectors including construction, engineering and healthcare.
The government says that reforms will support other policy aims, including house-building and economic growth.
“More routes into skilled work means more people building affordable homes, more care for NHS patients and more digital experts to push our economy forward.”
The new apprenticeships will be supported by a £3bn budget, with an additional £136m to set up “Skills Bootcamps” for high-priority sectors.
Education secretary Bridget Phillipson said that the government is “backing the next generation by giving young people more opportunities to learn a trade, earn a wage and achieve and thrive”.
“When we invest in skills for young people, we invest in a shared, stronger economic future – creating opportunities as part of our Plan for Change.”
The Chartered Institute’s apprenticeship delivery arm, IOEx, provides Level 2, Level 3 and Level 5 qualifications in areas including warehouse operations, freight forwarding and management skills. To learn more, click here.
