The government has announced that, starting January 2026, employers will only be able to use the apprenticeship levy to fund Level 7 courses (equivalent to a Master’s degree) for existing apprentices and those aged 16 to 21. These courses accounted for around 10% of the overall apprenticeship budget. The change helps address concerns that employers have been using Level 7 funding to upskill existing staff with expensive qualifications such as MBAs. It is also part of a broader policy to address skills shortages in key sectors and to refocus training on the youngest age groups, including the introduction of new foundation apprenticeships from August 2025. Plans to replace the existing apprenticeship levy with a “Growth and Skills Levy” are already being implemented.