Non-levy paying main provider with own Apprentices

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This topic contains 15 replies, has 6 voices, and was last updated by  paultaylor 2 days, 17 hours ago.

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  • Alan Taws
    Participant

    Can’t seem to find any clear guidance for a main provider that is non-levy paying and wants to employ their own Apprentices. The rules for “Employer Providers” state that you can only be an “Employer Provider” if you are levy paying… but the rules for Main Providers don’t seem to mention anything about a requirement to be levy paying before you train your own Apprentices so, assuming it is OK for a non-levy paying Main Provider to train their own Apprentices, is there any specific guidance on how you deal with paying the 19+ employer contribution to yourself – other than the obvious rule about not using the SFA funding to pay Apprenticeship wages?

     
    • This topic was modified 1 week ago by  Alan Taws.
    #151852

    Martin West
    Participant

    Hi Alan,
    I can see the predicament if you are a main provider as you will need to show that the co-investment contribution has been made.
    P172. We will continue to make payments to you provided you record that you have collected the employer’s contribution. You must keep evidence that these contributions have been collected. You must not return, in total or in part, the employer’s contribution once the co-investment has been collected.
    P176. The employer co-investment must be a transfer of funding visible in your financial systems. This will typically be in the form of a provider invoice and corresponding employer payment.

    I would ask your finance department how they can accomplish the documentation required in P176 as you may be able to use an internal credit note as this is not a typical situation where an invoice and actual payment would be recorded.
    HTH

     
    #151863

    liamryan
    Participant

    If I get this right you are a training provider that is on RoATP as a main Provider. You don’t pay the levy but want to employ and train your own apprentices? If that is the case and you want to claim funding you would need to have a contract to deliver to non-levy payers. Since the ITT for these was cancelled you wouldn’t be able to do this unless you already have a pre May 1st apprenticeship contract.

     
    #151866

    Alan Taws
    Participant

    Hi Martin

    I’m assuming that’s the case – we just invoice ourselves – but I’ll keep looking to see if there’s any official statement on this and I’ll post it on here

     
    #151873

    Sue Bishop
    Participant

    If you don’t have a pre 1st May contract and have been delivering apprenticeships under a subcontracting agreement with a Prime, you could put your apprentice on that contract (though you’d pay a top slice).

    Regards,

    Sue

     
    #151897

    Alan Taws
    Participant

    We are a prime with a contract to deliver to levy payers and pre-May allocation extension for non-levy. When the non-levy contracts issue is resolved then I would assume that we could only train our own Apprenticeships if we are successful in procuring a non-levy allocation? Potentially we could end up being able to deliver to levy payers but not ourselves if we don’t get an allocation for non-levy! Surely not.

     
    #151905

    GaynorLF
    Participant

    Hi Alan

    We’re in the same boat. We are an ITP and we train non-levy (within that our own Apprentices too)

    The only solution we have come up with is to have open separate bank account for employer contributions, which we also intend to use to pay for EPAs too. We intend to invoice ourselves and transfer funds to cover contributions due on a monthly basis.

    Don’t know if this is something your company could consider?

     
    #151917

    paultaylor
    Participant

    I read the funding guidance a little differently.

    I agree that where a training provider is delivering training to it’s own learners then the employer-provider rules apply, but that you do not have to be a levy payer to be an employer provider.

    EP134. This delivery can be funded using funds in your digital account or government-employer co-investment.

    Although the employer-provider guidance differentiates between the levy model and the co-investment model, it does not explain how co-investment payments have to be made in the same way the Employer or Training Provider guidance does. By it’s omission, my reading of this is that you do not need to make payments to yourself.

    From a finance point of view I don’t think that you can do this but I’m not sure – I doubt financial auditors would approve of this practice, although you could make a provision and transfer values to a training line in your accounts I suppose.

    I think that you would still have to put the co-investment on the ILR to trigger the ESFA co-investment, but the ESFA should accept that actually paying yourself is not a required action in this circumstance.

    Probably one for the ESFA to confirm but I suspect that this is one of those scenarios that it has not considered, or at least expanded upon in the funding rules.

     
    • This reply was modified 1 week ago by  paultaylor.
    • This reply was modified 1 week ago by  paultaylor.
    • This reply was modified 1 week ago by  paultaylor.
    #151949

    Alan Taws
    Participant

    I think that employer providers in the contractual sense are only allowed to access co-funding SFA funds if and when their levy pot runs out – and as a starting point an employer provider can’t gain a contract without being a levy payer. Whereas a lead training provider can access SFA funds straight off – and I doubt we can avoid having to invoice ourselves and as GaynorLF suggested above it might make sense to have a separate bank account just for the sake of clarity I.e. where you can demonstrate that the funds in the bank account that is used to pay contributions is not holding money sourced from the SFA – but again it may just be okay to keep separate lines in the accounts.

     
    #151954

    paultaylor
    Participant

    You are right that you have to be a levy payer to be an employer-provider. It’s not explicit in the funding rules but explains this in the employer-provider ROATP guidance.

    https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/606143/Joining_the_Register_of_Apprenticeship_Training_Providers.pdf

    However, to me it still does not make sense that you would have to evidence payments to yourself. The evidential requirement is still to evidence your costs of delivery, as opposed to showing in a finance system that you have made a payment from and to yourself that has a net value of 0. But I’ll leave that one to the ESFA. It’s not clear either way.

     
    #151969

    Martin West
    Participant

    Hi All,
    The initial question relates to a Main Provider delivering apprenticeships to their own employees and in this respect the Apprenticeship funding and performance-management rules for training providers would apply and this includes delivering apprenticeships to levy and non-levy paying employers alike.
    In this situation, the PROVIDER and EMPLOYER RULES would apply but the EMPLOYER PROVIDER RULES would not.
    The other difference that would apply in this situation is that the initial price recorded will be the estimated cost of training and all assessment for each apprenticeship instead of the normal negotiated price that the Main Provider would use. This requirement is set out in the Technical funding guide Paragraph 13.
    HTH

     
    #152173

    Alan Taws
    Participant

    A colleague of mine has been told by an SFA rep that we actually can’t train our own Apprentices unless we are a levy payer. I’m assuming this SFA person has made a mistake i.e. confusing the rules for employer providers, who must be levy payers and can only train their own staff. I assume those rules do not apply to an existing lead contract holder. We are not an “Employer Provider” in the contractual sense – we are a lead ITP with a contract to deliver to levy payers and to continue to deliver to non-levy payers whilst the non-levy procurement process remains on hold – I do not see anything in the rules that says we have be a levy payer before we can train our own staff as Apprentices.
    We really need some clarity on this – can we or can we not train our own staff through Apprenticeships?

     
    • This reply was modified 2 days, 21 hours ago by  Alan Taws.
    #153530

    Martin West
    Participant

    Hi Alan,
    I think who ever told your colleague that has got it the wrong way round as an Employer provider can only train their own employees but a Main provider can deliver to all employers irrespective to whether they use a digital account or not including ‘Your own staff’ as identified in the application route grid contained in the RoATP joining documentation.
    HTH

     
    #153569

    Alan Taws
    Participant

    Hi Martin

    The trouble is the application grid is really only talking about what route to take if you want to deliver to levy payers. For Mains and Employer Providers it only gives scenarios requiring the use of a digital account – it doesn’t give any guidance for Apprenticeships that aren’t paid for through digital accounts i.e. non-levy payers. So you can only make assumptions with regards to Mains delivering to their own Apprentices without having a digital account.

     
    • This reply was modified 2 days, 18 hours ago by  Alan Taws.
    #153592

    Martin West
    Participant

    Hi Alan,
    I can understand how the guidance could be misinterpreted as it does not specifically state that a Main provider can train their own employees.

    I think it is how you read the Application route grid that is the issue and the following similar situation regarding Employer providers supports the scenarios where you can be a Main and Employer provider at the same time.

    Employer providers under the previous register and rules could deliver to their franchisees who were not their direct employees but they were advised by the SFA that to continue to do this that they would have to apply to the new RoATP register as a Main provider to continue to do this.
    The other proviso was that you had to compete in a procurement exercise for employers that will not use a digital account to pay for apprenticeship training.
    HTH

     
    #153619

    paultaylor
    Participant

    The funding rules need to provide the answer on how the this works and not the application route grid. I think that the rules do not cover this situation but neither do they explicitly say that you cannot deliver to your own staff either (where you are a training provider and not a levy payer).

    Again the SFA will have to clarify this but as with all funding rules it always worth understanding what the intention behind the funding rules is. In this instance, I do not believe that the Government would want stop a training provider from delivering to it’s own staff (I actually clarified this with the SFA last year before they published the rules as we do this but we are also a levy payer).

    The alternative would be to send all of your learners to another training provider which would probably cost more money to deliver. I’m sure that a common sense response would be delivered if the right person in the ESFA was asked this question.

     
    • This reply was modified 2 days, 17 hours ago by  paultaylor.
    #153635
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