UK Apprenticeship Overhaul: What are the changes and how will they impact your social value offer?

By Tilly Crowhurst Samtaler Social Value Consultant

Updated December 2025

Apprenticeships in the UK are undergoing significant changes, which will have a significant impact on social value commitments. Requirements for suppliers to generate Apprenticeships are a common feature in public sector social value tenders and most large suppliers to the public sector will have some kind of apprenticeship offer in their social value toolkit. 

We have updated this article, originally published in January 2025, to stay up to date with the changes.

Before you include apprenticeships in your social value commitments, take a minute to read this.

How do apprenticeships create Social Value?

Apprenticeships are viewed as a key means of delivering social value because they provide a route into the workforce, particularly young people from disadvantaged backgrounds or those without formal qualifications. They can also help employers in sectors facing skills shortages by creating a pipeline of skilled workers that can contribute to the long-term sustainability of their industries. 

Why is the Government making changes to the apprenticeships?

Concerns have been raised that the current Apprenticeship Levy system isn’t working. Department of Education figures show that the number of apprenticeships has decreased since it was introduced.  Rather than being a vehicle for social value, a recent report by the Chartered Institute of Personnel and Development (CIPD) found that the current system is incentivising employers to “rebadge training for existing staff as apprenticeships so they can claim back funding”.

In its 2024 General Election Manifesto Labour pledged to “rebalance” apprenticeships. Since taking office, the new Government has introduced significant reforms to the UK’s apprenticeship system. 

What are the key changes?

1. The Institute for Apprenticeships and Technical Education (IfATE) is now Skills England

   The IfATE has been replaced by a new body, Skills England, that is overseeing government funding for adult training courses and aims to bring together businesses, training providers, combined authorities, unions and national government to address skills shortages and upskill workforces. Employers wishing to engage with this new body can them at skills.england@education.gov.uk.

2. The Apprenticeship Levy has been replaced by the Growth and Skills Levy
   The revamped levy allows for more flexibility: Employers will be able to use up to 50% of their levy funds for training beyond traditional apprenticeships although we’re still awaiting details about what the new courses will be.

   The government is continuing to introduce changes to simplify the levy and make it more efficient. From the 2026/27 academic year, this includes:

   · removing the additional 10% uplift to levy accounts.

   · changing the 24-month expiry period for levy funds to 12 months.

   · changing the government’s co-investment rate to 75% (from 95%) for levy paying employers once they have exhausted their funds.

   · working with employers on the next phase of the Growth and Skills Levy reforms, including streamlining the suite of apprenticeship standards.

3. Restrictions on Level 7 Apprenticeships
   The government is refocusing investment towards young people at the start of their working lives, rather than those already in work with higher levels of prior learning and qualifications.

   So from January 2026, level 7 apprenticeships will continue to be government-funded for young people aged 16 to 21, and for care leavers or those with an Education, Health and Care Plan (EHCP) who are under 25 at the start of their apprenticeship in England. Funding will also continue for apprentices who started their programme before 1 January 2026.

   Employers may need to self-fund these programmes, if they are core to their SV offer.

4. Introduction of new Foundation Apprenticeships
   New foundation apprenticeships now provide paid training to young people who are not ready to start at level 2 or 3 - equivalent to GSCE/further education level.

5. Shorter Apprenticeships Allowed
   The rule requiring apprenticeships to last at least 12 months has been scrapped. This means some courses can now be shorter, which will be handy for specific training needs.

6. New “Apprenticeship Units” launching (New)

   From April 2026, short, flexible courses called apprenticeship units will be funded through the Growth and Skills Levy. These will focus on critical skills areas such as digital, AI, and engineering, enabling employers to upskill staff quickly.

7. Funding boost for SMEs (New)
   From August 2026, apprenticeships for eligible 16–24-year-olds in non-levy-paying employers (mainly SMEs) will be fully funded by government, removing the usual employer co-investment.

   In our last article, we talked about employers being allowed to transfer more of their levy. This new funding boost, while good for SMEs, means that levy transfers will no longer be necessary. Large employers who include levy transfers in their Social Value offer should review this.

8. English and maths requirements (New)

   For apprentices aged 19+, formal English and maths qualifications are no longer mandatory. Skills can be demonstrated through real work tasks, though funded courses remain available.

9. Apprentice Minimum Wage is Increasing (New)

   In April 2026, the apprentice minimum wage will rise again to £8.00 an hour.

Key Changes at a Glance:

What do these changes mean for Social Value commitments in procurement?

At the time of writing (December 2025), we know a lot more about the changes but we’re still waiting for more detail, and things may continue to change. With contracts being tendered so far into the future it’s vitally important to make sure that what you’re putting in bids now, is deliverable. As many will know, once a commitment is made at tender stage, it becomes contractual so it’s vital to think carefully about how these changes could affect your promises.

Here are the things Social Value professionals can do to prepare for the changes to apprenticeships :

• Make sure your social value solutioning teams know about the changes. You can continue to include apprenticeships in your bids but make it clear that

  delivery depends on levy funding and your ability to deliver is subject to government policy changes.

• Ask for clarification from procurers. If a tender specifies delivery of apprenticeships ask for clarification from the Procuring Authority about what impact the changes will have on these requirements and what the opportunity will be to change your commitments at a later date once more detail becomes available.

• Assume you will be funding Level 7 Apprenticeships independently – If these apprenticeships are critical to your social value delivery, budget to fund them without the levy.

• Plan for Wage Increases –Make sure you’re ready to cover the higher apprentice wages starting in April 2026. These costs must be covered by individual employers.

• Explore to make the most of the funding boost for SMEs – This will allow SMEs, who may never have taken on an apprentice before, to employ them.

• Review Levy Transfers - If levy transfer are within your social value offer, consider removing them from upcoming bids. SMEs will likely not need them given funding boosts.

• Support Your Apprentices - Build strong support systems to help apprentices succeed and stick around... before making bid commitments to hire them. 44% of apprentices drop out before their end-point assessment with many saying the reason they do so is because they are not supported through their training. Hiring apprentices does not add social value if they are not supported through their qualification and retained. When embracing the changes, organisations must also look to improve the quality of the apprentice experience.

• Talk to training providers & stay in the loop - Work with local training providers and keep an eye on updates for new opportunities that could suit your organisation’s needs. Could there be emerging training opportunities which would suit your contracts and workforce?

These changes offer opportunities for greater flexibility and inclusivity but also pose challenges for employers who rely on apprenticeships in their bids and commitments. To navigate this evolving landscape, it’s crucial for social value professionals to stay informed, proactively engage with training providers, and carefully assessing the implications for their workforce and social value strategies. By staying flexible and ahead of the game, you can keep apprenticeships at the heart of your social value strategy.

How we can help

At Samtaler, we specialise in helping businesses navigate the complexities of apprenticeship programmes and integrate them into their social value strategies.

Whether you’re looking to align with the latest government reforms, maximise the potential of your levy funds, or design apprenticeship initiatives that truly deliver social value, our team is here to support you. We provide expert guidance on creating sustainable, impactful apprenticeship programmes, ensuring your commitments are realistic, achievable, and aligned with procurement requirements. With our tailored advice and hands-on support, we’ll help you turn apprenticeships into a powerful tool for building skills, driving inclusion, and creating lasting social impact. Contact us at hello@samtaler.co.uk  

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