The Government is planning to cut by 25% its grant funding for further education (FE) between 2011/12 and 2014/15. Instead, from September next year apprentices over the age of 24 on Level 3 training courses will be included among the FE trainees able to access student loans.

The government believes the benefits to the individual of Level 3 apprenticeships is greater than lower level training, so it is right that the individuals who will benefit from the training should make a greater contribution to the costs of that training.

It is hoped this will produce a new wave of adult apprentices, many with established work-based skills, who are likely to be an attractive prospect for employers.

Repayment of the loans will start only when the apprentice earns a minimum level of income (currently £21,000 a year), which is the same cut-off point as for students in higher education. The Government is making £129million available for further education (FE) loans in 2013/14 rising to £398million in 2014/15.

The Government says those qualified on higher level apprenticeships earn, on average, 12% more than those without a Level 3 qualification. It says the return on investment in apprenticeships is high – £18 for every pound spent on the apprenticeship.