Privately Funded Apprenticeships

Most apprenticeships in England are publicly funded through DWP. A small number — around 1% currently — aren’t. These are privately funded apprenticeships: the employer pays all training and assessment costs directly, with no government contribution.

DWP published formal rules for these in August 2026, sitting alongside the main funding rules. If you haven’t encountered one yet, it’s worth knowing what they are before you do.

When does it come up?

The most common reason is that a learner doesn’t meet the eligibility criteria for a publicly funded programme. For example:

• Learners from devolved nations (Scotland, Wales, Northern Ireland) who happen to be doing an apprenticeship with an English employer
• Employers who want to use an apprenticeship framework for workforce development but don’t want to access public funding

In practice, it’s more often an employer or learner request than a provider-initiated arrangement. But if it happens, you need to know what applies.

The statutory requirements are the same

Just because there’s no public funding doesn’t mean the rules disappear. A privately funded apprenticeship still has to meet the same statutory requirements as a funded one:

• A valid English apprenticeship agreement (signed by the employer and apprentice)
• An approved standard on the Skills England register
• At least 8 months of training
• Off-the-job training, delivered during normal working hours
• Independent end point assessment aligned to the standard

Providers must also be on the Apprenticeship Provider and Assessment Register (APAR). You can’t deliver a privately funded apprenticeship without it.

English and maths

For learners aged 19 and over, English and maths are not required unless the apprenticeship standard itself specifies them. For 16-18s, the standard rules apply.

This is one of the few areas where privately funded and publicly funded programmes genuinely differ in their requirements (rather than just in funding flows).

What the employer still gets

Even without public funding, the employer can still:

• Pay the apprentice at the apprentice minimum wage (rather than the National Living Wage) for the first year, if the apprentice is under 19 or in their first year
• Claim the National Insurance exemption for apprentices aged under 25

The apprentice minimum wage and the NI exemption are statutory entitlements tied to the employment relationship, not to the funding mechanism.

What the employer and provider don’t get

This is the practical list of things that disappear without public funding:

• Training incentive payments
• Assessment incentive payments
• The £1,000 additional payment for younger apprentices
• Care leaver bursaries
• Learning support funding

The £2,000 hiring payment for non-levy employers taking on 16-24 year olds (introduced for 2026-27) is also not available for privately funded programmes.

ILR recording

Providers still need to submit ILR data for privately funded apprentices. The key difference is the funding source code: use code 99 (unfunded by DWP) rather than the standard funding codes. This flags to DWP that the learner’s programme is not drawing on public funds.

The rest of the ILR submission follows the same structure as a funded programme.

The practical upshot

For most providers, privately funded apprenticeships will be rare. But when they occur, the core obligations — APAR registration, approved standard, OTJ, EPA — don’t change. What changes is the absence of incentive payments, the English and maths flexibility for adult learners, and the ILR funding code.

The full guidance is at Privately funded apprenticeships: rules and guidance.