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Introduction

How are traineeships funded? Funding for providers and employers

Traineeships are funded by the ESFA using existing funding models.

How are traineeships funded? Funding for providers and employers

How are traineeships funded? Funding for providers and employers

Traineeships have been growing in popularity recently. In July 2020, Rishi Sunak announced a new £1,000 incentive scheme to encourage employers to offer traineeships. The Government also highlighted traineeships in its 2021 Skills for Jobs White Paper. Traineeships are on the up – and for good reason.

What are traineeships?

Traineeships give young people the opportunity to complete a work placement in a real company. The placements normally last anywhere between 6 weeks and 6 months, but the maximum duration has currently been increased to 12 months due to Covid-19.

During their placement, trainees must complete at least 70 hours of work experience. Trainees are guaranteed an interview for an apprenticeship or job at the end of the programme.

Traineeships also enable employers to hire and train new staff at no extra cost. If the trainee shows promise and there is a relevant role available, employers can interview and hire trainees after their placement – without having to pay recruitment fees. It’s a great opportunity for employers to invest in the right people for their business.

How are traineeships funded?

Traineeships are paid for by the ESFA. The funding formula is different for trainees of different ages, but uses existing funding models with a few changes.

Training providers

The funding for 16- to 18-year-old trainees is calculated using the 16-19 funding model. The funding formula measures the volume of delivery through student numbers and the size of their programme.

For 19- to 24-year-old trainees, the funding is calculated a little differently. Funding is calculated using the adult education budget (AEB) funding rules. The core formula includes funding for these elements of the traineeship:

  • £1,500 single work placement and work preparation rate
  • Funding for English, maths and digital skills
  • Funding for flexible elements – including relevant technical qualifications or vocational learning elements to support the progression to an apprenticeship

Providers may also receive additional funding for 16- to 18-year-olds – such as disadvantage funding, high-needs student funding or discretional bursaries – or learner support for 19-24 traineeships. Some trainees may also be eligible for job outcomes payments.

Employers

As part of the Treasury’s Plan for Jobs, the Government has invested additional funding into traineeships to help boost the economy. One of these measures is the employer incentive scheme to encourage employers to offer traineeships.

Employers receive £1,000 for taking on any trainee (between 16 – 24 years old). Employers can claim the bonus for up to 10 trainees per company.

Using OneFile to deliver traineeships

OneFile is the UK’s leading apprenticeship software, but it can be used for traineeships too. The system is very flexible, so it has everything you need to deliver, manage, track and report on traineeship programmes.

We are currently using OneFile for all our traineeship learners. They love it and so do we. The training modules are fabulous – thank you OneFile.”

Amanda Lodge-Stewart, vice president | NHBF

To find out more about using OneFile to deliver traineeships, download your ultimate guide to traineeships.

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This article includes research and opinion sourced by OneFile at the time of publication. Things may have changed since then,
so this research is to be used at the reader's discretion. OneFile is not liable for any action taken based on this research.