Nick Linford

Nick Linford

Nick is ADI's director and apprenticeship expert

About Nick

Finally, dfE forced to reveal returning £2bn

Apprenticeship and skills ministers, and there have been four since the apprenticeship levy was introduced in 2017, have all had one thing in common. Until today, they’ve all successfully dodged revealing how much of the budget has been returned to the Treasury. Over £2bn in four years.

In fact, there have been at least five attempts by MPs to use a Parliamentary written question to get an answer from ministers:

> Catherine West MP asked ministers in Feb 2020. Read the non-response here.
> Toby Perkins MP asked ministers in May 2021. Read the non-response here.
> Kate Green MP asked ministers  in July 2021. Read the non-response here.
> Emma Hardy MP asked ministers in October 2021. Read the non-response here.
> And the most astonishing one, Richard Holden (Conservative MP and former SpAD to the education secretary) asked on the 22 September and had to wait until yesterday to get a non-response. See here

The apprenticeship underspend has clearly been a source of considerable sector and political interest. But in the absence of an answer, many have floundered around, misunderstanding how the apprenticeship system works. In July 2022, it was incorrectly claimed, and picked up by some media, that “more than £3.3 billion has returned to the Treasury in the last three years”.  This is not true. When an employer fails to use their own levy pot, it does not automatically go back to the Treasury. Since 2017 the Treasury has allocated an annual apprenticeship budget to the DfE, which is also used to fund apprenticeships at small employers and incentive payments, amongst other things.

But what happens if, by the end of a financial year, the DfE has not spend all of the apprenticeship budget allocated by the Treasury? Because the apprenticeship funding is ring-fenced, the DfE cannot spend it on alternative provision so it must go back to the Treasury.

So, the first Freedom of Information Request I submitted in my capacity as director of ADI, was to attempt to finally get an answer. To set the record straight. To try and avoid further misinformation and misunderstanding.

As described on the FoI section of this website (here), I submitted an FoI on 31 August, and waited. Once the 20 working days had passed, I tracked down a senior FoI manager at the DfE and emailed them. Again and again.

Today, after involving another senior director at the DfE, I got the answer to my information request. 

So, now we know, that for the financial year 2020-21 £604 million out of a DfE budget of £2,467 million (24%) was returned to the Treasury. And, thanks to an FE Week FoI request also received today which included budget and spend data for 17-18 and 18-19, we know that for the four years since 2017, just over £2bn (23%) has been returned to the Treasury (see table below).

However, the DfE has refused to reveal figures for the last financial year (21-22), citing Section 23 of the Act. They claim these figures can be withheld on the basis they DfE and ESFA accounts have not yet been published. I’ve requested an internal review of this decision, given they’ve never before included this information in any set of published accounts.

The first of many transparency wins for ADI!