Lord Nash, Parliamentary Under Secretary of State at the Department for Education, has responded to a written question on an estimation of the funds that employers are likely to lose as a result of funds in their digital accounts expiring.

This problem has been highlighted by CTG in all of its representations to Government on the Apprenticeship Levy, and we believe that charities – many of which do not have in place the necessary structures to use their funds adequately – will be particularly vulnerable.

While the answer does not give any concrete estimation of the cost of this occurrence, it does reiterate the extension of the period employers will have to spend their digital funds from 18 to 24 months, as well as giving information on the new employer working group which includes charity sector representation.

Lord Aberdare: What estimate they have made of the amount, if any, which (1) registered charities, and (2) private sector employers, paying the Apprenticeship Levy will lose as a result of funds in their digital account expiring because the employer was unable to spend them.

Lord Nash: We have made a commitment to allow employers to transfer digital funds to other employers in their supply chains, sectors or communities in 2018. We have suggested that this should initially be set at 10 per cent.

We have created a new employer working group, including the Charities Finance Group, to help us further develop proposals for a transfers system that works for employers. Alongside detailed research into the needs of employers of all sizes, this group will help us design how transfers should work, the level of funds that could be transferred and what controls are needed to protect the integrity of the apprenticeship system.

Unlike other taxes, levied employers can get back their contributions if they are committed to training sufficient numbers of high-quality apprentices. They will also receive a top up of 10 per cent on their digital funds.

There has been no specific assessment of the amount registered charities and private sector employers paying the Apprenticeship Levy will lose as a result of funds in their digital account expiring because the employer was unable to spend them. Last month we announced an extension to the period employers will have to spend their digital funds, from 18 to 24 months.

We have published estimates of levy payments, and apprenticeship spending, by sector in the attached document.

The document referenced above can be accessed here, though it does not include a specific “voluntary sector” category in its breakdown.