The government should fund 100 per cent of the training cost and salaries of apprentices for small and medium-sized enterprises at least for the first year, the chair of the Commons Education Select Committee has said.
Speaking at the Association of Employment and Learning Providers' (AELP) national conference today, Robert Halfon, a former skills minister, said doing so would provide a “rocket boost” for apprenticeships.
Mr Halfon highlighted a dramatic fall in apprenticeship starts among all age groups from 509,000 in 2015-16 to 323,000 in 2019-20 – an overall decline of 37 per cent. The fall, he said, was particularly acute for the most disadvantaged young people, with starts for under-25s dropping by 52 per cent.
“We should try and ensure that every person is given an apprenticeship guarantee and strategically weigh the levy in favour of young people, especially those from disadvantaged backgrounds, to address the rising unemployment figures in this age group.
"To support SMEs, we should fund that 100 per cent of training costs and salary, at least for the first year of an apprenticeship."
Robert Halfon: How to 'rocket boost' apprenticeships
The documents published by the Treasury after the chancellor's speech also confirmed a new "flexi-job" apprenticeship, which will allow apprentices to work with a range of employers in the same sector. From July, employers will be able to bid for cash from a £7 million fund to create agencies to offer the apprenticeships.
Mr Halfon said the government should have given less apprenticeships and Kickstart funding to bigger companies and more to smaller companies.
"I think what the government should have done, with the money that they've given towards apprenticeships and Kickstart, is it's going to every company whether they're big or small, and I think if they'd perhaps not given so much to the bigger companies, and given that money to smaller companies, you would've been able to give those companies more money than the existing schemes they're on.
"I think that would have been a bigger incentive for those smaller companies to employ young people and employ apprentices, but I also think we need to rocket boost our apprenticeship programme.
"I've talked about an apprenticeship guarantee and I think if you gave that incentive to small businesses to do this, I think it would make a huge difference and I suspect that it would be very successful, and they will be able to employ a lot more apprentices than they otherwise might do."
Jane Hickie, chief executive of AELP, said: “AELP called for wage subsidies early in the pandemic and so we are pleased that the Opposition and the Education Committee chair share similar views.
"The public finances are a big factor in all this and this is why in 2021 we have advocated a more targeted approach to incentives.
"We are concerned that young people on Kickstart, for example, are not necessarily going to progress on to an apprenticeship and so proposals from Robert Halfon and others can make a difference in giving young people a proper career path instead of a welcome but short-term respite off benefits."