Teenagers could be turned away from work-based training because of a funding shortage, ministers have been warned.

The problems mirror last year’s crisis in colleges when ministers had to bail out instititutions struggling to meet high demand for courses from 16 to 18-year-olds.

Private training firms have told the Commons education select committee they now need similar help to cope with demand, but are being ignored by ministers.

Graham Hoyle, chief executive of the Association of Learning Providers, said that so many more apprentices were staying on that there was a risk that there would not be enough cash to fund any new recruits.

Preliminary results of a survey of the association’s members show 60 per cent expect to freeze recruitment of 16 to 18-year-olds if there is no more cash by the end of June.

The Learning and Skills Council says it will work with the ALP to make funding more responsive to demand.

In his letter to MPs, Mr Hoyle said: “The situation is so serious that the LSC could be in danger of missing its target of 175,000 apprenticeship starts for 2004-5.

“The LSC is obliged under the learning guarantee for 16 to 18-year-olds to fund apprenticeships for this age group and because better-quality training is resulting in more young people staying on to complete their apprenticeships, there is less money available to fund new starts.”

Last year, colleges said they would have to consider turning away potential students because local LSCs did not have the cash to cope with the increased demand.

But the Department for Education and Skills came up with a further pound;130 million to enable the LSC to meet its obligation to fund students in that age group.

Mr Hoyle says providers that have recruited as many 16 to 18-year-olds as their contracts allow have been advised by local LSCs to take no more.

But one of the ALP’s largest members, who spoke to FE Focus, has vowed to call the LSC’s bluff and continue to recruit from the age group even if he goes over his contractual limit for apprentices.

He said: “There is a funding guarantee and I will hold them to it. I may live to regret it, but the LSC will have to find more money. It’s committed.”

The ALP says other training firms cannot afford to risk taking on trainees only to find that the LSC then refuses to fund the extra places. The council says the problem is essentially one borne out of success because recruitment and completion rates for apprenticeships are improving faster than anticipated in some cases.

But it stressed that many providers are falling short of the recruitment targets. This suggests the problem could be reduced by reallocating resources to the most popular training firms.

The council says it remains committed to meeting the demand from teenagers who want to join the programme and employers wanting to take on more trainees.

Stephen Gardiner, the LSC’s director of work-based learning, said: “We will work with the ALP to manage the process.”

He said the council still intended to meet its target for apprenticeship recruitment.

Employers warned that more funding would be needed when Modern Apprenticeships were relaunched as “Apprenticeships” in May last year. The latest concerns are for 16 to 18-year-olds, but the ALP says its members are worried that older workers could be discriminated against if the Government continues to prioritise the funding of teenage trainees.

* steve.hook@tes.co.uk