Apprenticeship funding just got a lot more generous for the under-25s
From 1st August 2026, the government covers 100% of training and assessment costs for eligible apprentices aged 16 to 24. If you're a levy-paying nursery, the 5% top-up you're used to paying disappears entirely for this age group.
100%
Training costs funded for eligible 16 - 24s
£0
Employer co-investment for this age group
£6,000
Extra hiring incentives potentially available
What's actually changing
Under the August 2026 reforms, if a levy-paying employer exhausts their digital account funds, the government fully covers training and assessment costs (100% funded) for new apprentices aged 16 to 24, requiring zero employer contribution. However, for apprentices aged 25 and older, the employer co-investment contribution rises significantly from 5% to 25%, with the government covering the remaining 75%.
Covers the wider Growth and Skills offer: apprenticeships, foundation apprenticeships (16-21) and apprenticeship units
Applies to every employer, large or small, not just those with the biggest levy pots
Starts for new apprentices from 1st August 2026
What it looks like in pounds
Take a Level 2 Early Years Practitioner apprenticeship, which sits in a £5,000 funding band.
Level 2 Early Years Practitioner · £5,000 funding band
Apprentice aged 16 to 24
Apprentice aged 25 or over
£1,250 (25%)
£3,750 (75%)
Worth flagging: this only applies to new starts from 1st August 2026. If you already have an apprentice on programme, they'll keep the current 95% government co-investment rate once your levy funds are exhausted. Nobody currently training loses out - the fully-funded rate is for new enrolments only.
Employer Incentive Payments
The government offers several cash incentive payments for employers who hire apprentices. Multiple payments can stack, meaning the total support for a single hire can be substantial.
For full details, review the Funding Rules 2627 Version 3 Final (PDF)
Why this matters for early years right now
More support on the way for young people from lower-income households
For a small number of families receiving benefits, starting an apprenticeship can reduce household income, which puts some young people off applying even when the opportunity is a good one. The government is introducing a targeted bursary to remove that barrier. Details on eligibility, how it's paid, and the rollout timeline haven't been published yet - we'll update this page as soon as they are.
You could get more than just the training paid for
Up to £6,000 in hiring incentives and grants
No employer National Insurance contributions for apprentices under 25
That's on top of the fully-funded training from August. Read our guide to childcare funding to see what you could claim.
Frequently asked questions
When does this change take effect?
-
- From 1st August 2026. It applies to new apprenticeship starts from that date onwards, not to apprentices already on programme.
Does it apply to non-levy employers too?
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- Yes. The 100% funding for eligible 16 to 24 year olds applies to every employer, whether or not you pay the apprenticeship levy.
Will my existing apprentices lose out?
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- No. Anyone already on an apprenticeship keeps the current 95% government co-investment rate once your levy funds are exhausted. The fully funded rate is only for new starts from 1st August 2026.
Is there financial support beyond the training costs?
-
- Yes. You may be eligible for up to £6,000 in hiring incentives and grants, plus no employer National Insurance contributions for apprentices under 25.
Ready to plan your next apprentice hire?
If you've got a role you've been meaning to fill, or a team member who'd thrive with structured training,
now is the time to act! Get in touch and we'll walk you through what's eligible and what it'll cost.