From January 2026, government funding for advanced Level 7 apprenticeships will be withdrawn as part of a shift to prioritise construction and care worker apprenticeships. As a result, many apprenticeships for roles in accounting and tax will no longer be supported unless the individual is under 21 years of age.
The government has allocated £3bn for apprenticeships but is now directing funds towards more practical, lower-level apprenticeships to address urgent skills shortages.
Confirming the focus on younger apprentices, the government stated it would “refocus funding away from Level 7 (masters-level) apprenticeships from January 2026, while continuing to support apprentices aged 16-21 and those currently enrolled. This will allow levy funding to be reallocated to training at lower levels, where it can have the most significant impact.”
This move to discontinue funding for Level 7 apprenticeships has sparked criticism, particularly within the accountancy sector, where apprenticeship numbers have increased significantly in recent years. However, it’s important to highlight that the majority of these apprentices are school leavers, not individuals over the age of 21.
In 2023, the six largest firms, including the Big Four, BDO, and Grant Thornton, employed 8,764 apprentices – an increase of over 1,000 from the previous year.
The 2024 Business & Accountancy Daily Top 75 Trainees Firms survey revealed that nearly 13,500 apprentices were training across leading accountancy firms, marking a 10% rise in just one year. Many school leavers are choosing apprenticeships over university to avoid the debt associated with student loans.
Vipul Sheth, Managing Director of Advancetrack, commented: “It’s encouraging to see continued support for those under 21 pursuing an accountancy career, but the decision to cut funding for those over 21 is concerning. This policy risks excluding a significant pool of talent, including career changers and older learners, during a time of acute skills shortages in our sector.”
Sheth continued: “Accounting is not just a career for school leavers; many successful apprentices begin their training later in life, bringing valuable experience and diverse perspectives. This decision could severely limit access to apprenticeships for smaller firms across the country, which rely on government support to invest in their teams.”
There have been calls to reform the Level 7 funding rather than eliminate it, as it represents a small proportion of apprenticeships.
Lizzie Crowley, Senior Skills Adviser at the CIPD, argued: “The decision to limit funding for all Level 7 apprenticeships to those aged 16-21 is unlikely to significantly increase youth participation, given that fewer than one in ten apprentices at this level fall within this age group. While rebalancing the system towards younger people is important, this blunt approach risks undermining the diversity and ambition of the apprenticeship offer. We have previously called for a more refined approach, such as reduced subsidies for older apprentices.”
The announcement does not address the core issue with the Apprenticeship Levy, which is considered a key obstacle.
Neil Carberry, CEO of the Recruitment and Employment Confederation (REC), stated: “The changes do not tackle the real issue – the poorly designed apprenticeship levy. Reforming it through a new Growth and Skills levy could provide a significant boost for both individuals and employers, but progress has been slow, frustrating many businesses. A focus on shorter, modular courses and collaboration with employers is vital to unlock the full potential of talent across sectors such as healthcare and construction.”
This announcement follows a steep decline in apprenticeship starts over the last decade, with recent ONS data showing that one in eight 16-24-year-olds are now not in education, employment, or training (NEET).
