Why The £60m Apprenticeship Funding By Rishi Sunak is a Step in The Right Direction

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Prime Minister Rishi Sunak has unveiled the Government’s new £60m apprenticeship funding package. He claims this will deliver 20,000 new apprenticeship opportunities for young people, but some experts argue that it’s not enough. Below, we examine the Government’s plan in more detail, why some in HR believe more is required, and why, despite this, it’s still a step in the right direction.

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Government to Fully Fund Apprenticeship Programs for Those up to 21

From 1 April 2024, the Government will inject an additional £60m in apprenticeship funding. This will cover the complete cost of apprenticeships for small businesses when training individuals up to the age of 21. Should such businesses have a skills demand, the Government claims it will ensure they have the necessary funding for apprenticeship training.

READ: Employees Want Workplace Training – And Here is What They Are Looking For

Furthermore, the Government will enable companies that are paying the apprenticeship levy to transfer additional funding to other businesses. The current amount will be doubled, meaning large companies will be able to shift up to 50% of their unused levy. As a result, more apprenticeship funding will be made available for small businesses.

£60m Apprenticeship Funding – A Drop in the Ocean, Claim Experts

Whilst Rishi Sunak showed excitement in announcing the new apprenticeship scheme plans, some industry experts were less enthused. The Prime Minister claimed the new apprenticeship funding would unlock a “tidal wave” of opportunities, but others felt it was a drop in the ocean.

apprenticeship funding

Ben Willmott, the Chartered Institute of Personnel and Development’s head of public policy, welcomed the funding but felt much still needed to be done. Before criticising, he said the complete funding for young people would encourage the offering of apprenticeships amongst smaller businesses. As such, more opportunities could be opened for the young individuals who require them the most.

However, Mr Willmott didn’t think the Government’s additional support would address the apprenticeship training collapse in small and medium-sized enterprises (SMEs) seen since 2017. This was despite the 20,000 new opportunities brought about by the Government’s plan, suggesting more apprenticeship funding was required.

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What’s more, he believed the apprenticeship levy boost was largely irrelevant, claiming only a minority of levy-paying companies had used the scheme since its inception. Therefore, he suggested how he felt the scheme could be better utilised. By enabling companies to use their levy funding for cheaper internal training, typically more appropriate for those aged 25 plus, he claimed:

  • Individuals who wouldn’t benefit from apprenticeship training could instead enjoy other development opportunities
  • More funding would be made available elsewhere to provide young people with the apprenticeship programs they need

A Positive Step Shown in the Government’s Plans

Despite the criticisms from HR experts, the Government’s new apprenticeship funding could still be considered a positive step. By fully funding companies offering apprenticeships to young people, more small businesses will be able to provide them with opportunities. It will also make the apprenticeship scheme more efficient, as training providers won’t need to spend time seeking external funding.

Moreover, the improved levy funding transfer scheme would lower the cost of apprenticeships for small businesses. In turn, this could enable more SMEs to offer apprenticeships, resulting in better opportunities for young people and reducing the skills shortage.

Therefore, even if experts are correct and more needs to be done, the new apprenticeship funding announced should be the start of better training opportunities for young people. In time, this support could help young individuals thrive in their careers and remove the skills shortage employers currently face.

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