Subcontracting under the apprenticeship funding rules

The principle

You can subcontract delivery, but you cannot subcontract responsibility. The funding is yours, the claim is yours, and the liability for both remains yours whatever the arrangement says.

That means you must be able to evidence oversight: that you know what is being delivered, that it meets the standard, and that the funding reaching the subcontractor is proportionate to what they do.

What must be declared

Subcontracting arrangements must be declared, and above the reporting threshold they must be published. The rules also restrict what can be subcontracted and to whom, and expect a rationale that is about quality or reach rather than convenience.

Where it goes wrong

Arrangements that were never declared. Management fees that cannot be justified against the oversight actually provided. Subcontractors holding the only copies of evidence. Delivery that the lead provider cannot describe in any detail.

Undeclared subcontracting is one of the few compliance failures that reliably escalates beyond funding recovery.

Evidencing oversight

Oversight has to be visible in records, not just described in a contract. That means observations of subcontracted delivery, samples of learner files held by the subcontractor, records of the quality conversations you have had, and evidence that issues raised were followed through.

Auditors also look at whether the fee you retain is proportionate to that work. A management fee at the top of the range with no record of any management is a finding in itself, and it is one that tends to prompt a wider review rather than a single adjustment.

Where a subcontractor holds evidence you need, get your own copy at the point it is created. Recovering files from a subcontractor who has lost the contract, or gone out of business, is not a position you want to be in when an auditor is waiting.