Growth and Skills Levy Offer
Understanding the changes shaping England’s skills system
Understand the key reforms shaping England’s skills landscape, from the Growth and Skills Levy offer to new apprenticeship units and funding changes, designed to create a more flexible and responsive skills training system.
Skills England: Driving a more coherent, responsive skills system
Established in June 2025, Skills England is responsible for leading the national skills strategy under the mission: “better skills for better jobs”.
Its purpose is to build a more coordinated system that aligns training with labour-market needs across England. To achieve this, it focuses on three national priorities:
Developing an authoritative picture of the skills the country will need over the next decade
Ensuring the training system is flexible and responsive to employer demand at national, regional, and local levels, including co-creating training solutions
Strengthening alignment between national and regional skills planning through Local Skills Improvement Plans (LSIPs)
Skills England’s approach is rooted in collaboration, bringing together employers, providers, local leaders, trade unions, and central government to plan for long-term workforce needs.
The Growth and Skills Levy offer: A more flexible funding system
Announced in April 2025, the Growth and Skills Levy offer gives employers greater flexibility in how they meet skills needs. Several reforms have already been implemented:
New Apprenticeship Units (from April 2026)
Apprenticeship units represent one of the most significant proposed changes to the system so far. They are designed to make training more flexible, more targeted, and easier for employers and learners to access.
What they are
Short, formally recognised units that come directly from existing apprenticeship standards
Made up of specific knowledge and skills that are defined within an existing full apprenticeship standard
How they work
Delivered as short training units, expected to typically last from between 1 week to 16 weeks
Designed to be taken independently of a full apprenticeship programme while still following the same approved standards
How they are funded
Funded through the Growth and Skills Levy, allowing employers to use their levy contributions for rapid upskilling alongside full apprenticeships
Who can deliver them
To ensure the highest standards of delivery, apprenticeship units will only be available through a select group of pre‑approved training providers. These providers must be listed on the government’s official Apprenticeship Provider and Assessment Register (APAR) and demonstrate strong indicators of quality, consistency, and proven training excellence.
Priority areas for the first units
The first units will focus on areas where skills shortages are most acute:
AI and Digital
Construction
Engineering
Full apprenticeships will continue to play a central role, providing the structured, comprehensive development needed to build long‑term workforce capability.
Further changes expected in 2026
From 1 August 2026, additional reforms are planned to take effect:
Levy funds will expire after 12 months instead of 24, requiring more proactive workforce and training planning
SMEs will receive full government funding for apprentices under 25, removing the usual 5% co‑investment cost
Co-investment rates for levy-paying employers will change when they have exhausted their levy funds:
Government contribution will reduce from 95% to 75%
Employer contribution will increase from 5% to 25%
These adjustments aim to encourage more timely use of funds, increase access for young people, and continue to prioritise high‑quality apprenticeships.
What this means for employers
Faster, targeted training options through apprenticeship units and shorter apprenticeship durations
Greater flexibility to respond to critical skills priorities, particularly in fast-moving sectors
More opportunities to build early-career talent, supported by new Level 2 Foundation Apprenticeship pathways
Reduced co-investment demands for SMEs, improving access to apprenticeships for young people
What this means for learners
Clearer entry routes into work, especially through Level 2 Foundation Apprenticeships
More targeted upskilling aligned with real job roles in priority areas
Training linked to progression pathways, shaped by employer and regional needs
More flexible ways to gain skills, including apprenticeship units and shorter apprenticeship durations
How we can support your organisation
If your business is considering traditional apprenticeships or exploring new apprenticeship units to upskill your teams, bring in fresh talent, or make the most of available funding to address your skills gaps, our team of expert advisors is here to support you every step of the way.
How our advisors can help:
Identify the right training pathways to match your skills needs, including apprenticeship units, Level 2 Foundation Apprenticeships, and full apprenticeships
Maximise your funding opportunities, ensuring your organisation makes the most effective use of the Growth and Skills Levy offer
Create a tailored skills development plan that aligns your business goals with the latest training and funding reforms
Need more help?
If you would like to discuss the impact of these changes or explore how to adapt your apprenticeship strategy in light of the changes, please contact us. Our team is here to support you in planning effectively for the year ahead.