Levy to Co-investment Switch

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This topic contains 4 replies, has 4 voices, and was last updated by  Martin West 1 year ago.

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  • TRaynor


    I am hoping someone can offer us some advice…

    We have an employer who currently has 3 employees on degree apprenticeship programmes with us, the employer ran out of levy funds for 1 of the employees after the first month and so reverted to the co-investment model.

    Please could someone advise on the best way to deal with this situation? e.i:

    – Do we invoice them every month depending on the amount showing on the reports?

    Any help would be greatly appreciated.



    Ruth CJ

    We’ve been having the same conversation. We haven’t yet come up with an answer! As I understand it, a single apprentice can be part levy funded and part co-funding model.

    At the moment, the report might have a monthly breakdown of what’s expected, but what if an earlier apprentice withdraws? Suddenly there’s money in the levy pot free, and next month’s report will show different amounts.

    You could charge them the full amount currently on the co-funding report in one go, then monitor the situation to see if they need a refund or need to pay more.

    You can get them to pay monthly as you get each report, though those amounts can be tiny! We have levy paying employers on the co-funding report, where the monthly amount is about £6. The employer is going to get bored with us invoicing them £6 each month.

    You could charge them at the end when you know the full picture, but that probably wouldn’t go well if the apprentice withdraws.

    I’d also be interested to see how other providers are managing this.



    HI Ruth, thank you for your reply.

    Yes its a funny one isn’t it? From what I can see so far ours will have to be invoiced approx. £9 per month and it just doesn’t seem right!

    It seems like its yet another thing that hasn’t been properly thought through.




    We had this issue last year. We had an employer move from Levy funded to Co-Investment (when the levy ran out due to an error with HMRC) and back to Levy (when the error was fixed) over a period of three months. We raised the invoices monthly 10% co-investment for the months that weren’t covered by the levy.

    When the error was fixed by HMRC we noticed that it doesn’t fix issues retrospectively and the situation is taken month by month.

    In the above situation, we had a conversation with the employer about what the issues were with the Levy pot, what our responsibilities were from the funding rules, what payment option they’d prefer.


    Martin West

    As payments are processed from a DAS account in priority order based on the provider and the dates individual Apprenticeship were approved, this should always result in the same learners being identified as requiring co-investment.

    Once in a co-investment position for a learner this would not normally be expected to change, the ESFA do not expect you to collect these contributions monthly and have indicated you should agree a payment schedule with the Employer to ensure that contributions are at least equal to the required 10% every three months.

    As Ruth has identified where an earlier priority learner withdraws then the co-investment situation may be fluid and require payment adjustment.

    It would be hoped that MI suppliers would be building into their systems some facility for recording and monitoring this.

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