Budget 2016 – key points.

The following is a summary of the key points regarding learning, training and employment.

Apprenticeship Levy

As announced at Autumn Statement and Spending Review 2015, the government will introduce the apprenticeship levy in April 2017. It will be set at a rate of 0.5% of an employer’s paybill and will be paid through PAYE. Each employer will receive an allowance of £15,000 to offset against their levy payment. This means the levy will only be paid on any paybill in excess of £3 million. (Finance Bill 2016) The government will apply a 10% top-up to monthly funds entering apprenticeship levy payers’ digital accounts in England from April 2017.

From April 2017, employers will receive a 10% top-up to their monthly levy contributions in England and this will be available for them to spend on apprenticeship training through their digital account. The government will set out further details on the operating model in April and draft funding rates will be published in June.

National Minimum Wage

The new mandatory National Living Wage (NLW) will come into effect from 1 April 2016, set at £7.20 an hour for workers aged 25 and above. The Government will set the main rate of the National Minimum Wage, which applies for workers aged between 21 and 24, at £6.95 from October 2016, in line with the Low Pay Commission’s recommendations.  The government has also accepted the LPC’s recommendations for the youth and apprentice rates of the National Minimum Wage, a 3.0% increase in the rate for apprentices (from £3.30 to £3.40 per hour).

Student Number Controls in Higher Education

The government will continue to free up student number controls for alternative providers predominantly offering degree level courses for the 2017-18 academic year. The best providers will also be able to grow their student places further through the performance pool.

Loans and Lifetime Learning

Direct government support for adults who wish to study at any qualification level from basic skills up to PhD. During this parliament, loans will be introduced for L 3 to L 6 training in further education, part-time second degrees in STEM, and postgraduate taught master’s courses.

Government will review gaps in support for lifetime learning, including for flexible and part-time study and will bring together information about the wages of graduates of different courses and the financial support available across further and higher education to ensure that people can make informed decisions about the right courses for them.

A longer school day for 25% of secondary schools

25% of secondary schools will be able to opt in to a longer school day from September 2017 so that they can offer a wider range of activities for pupils. There will be up to £285 million a year to pay for this.

Every school will be an academy by 2022

By the end of 2020, every school in England will be an academy or free school – or be in the process of becoming one. This will give head teachers more control over their budget and the curriculum they teach.

The current system for funding schools will also be replaced by a fairer national funding formula from April 2017. There will be £20 million a year in additional money for schools in the north of England.’


100% of local government resources will come from their own area by the end of this Parliament. There will be new devolution agreements with a mayor for East Anglia, the West of England and Greater Lincolnshire. Negotiations will be opened on city deals with Edinburgh and Swansea and Cardiff city region will get a new £1bn deal.

Greater Manchester is to get new powers over criminal justice and a Thames estuary commission will be established. 

Budget 2016 – Gov.uk
Gov.uk news story – Some of the things we’ve announced

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