Budget 2021: Training providers praise jobs boost for under-25s

Chancellor of the Exchequer Rishi Sunak today (3 March) pledged an additional £126m to create 40,000 more traineeships in England during the 2021/22 academic year.

The funding, which is part of the government’s Plan for Jobs scheme, is aimed at creating “high quality work placements and training for 16- to 24-year-olds”, Sunak told the House of Commons.

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Small and medium sized businesses (SMEs) will also be able to bid for funding to create traineeships, he added.

The Chancellor also announced the extension of increased incentives for companies who take on apprenticeships until September.

This means that employers who hire a new apprentice between 1 April 2021 and 30 September 2021 will receive £3,000 for each new person hired, compared with £1,500 per new apprentices hired (or £2,000 for those aged 24 and under) under the previous scheme. 

“This payment in addition to the existing £1,000 payment the government provides for all new 16- to 18-year-old apprentices and those aged under 25 with an Education, Health and Care Plan”, the Budget states.

A further £7m was committed to the government’s “flexi-job” apprenticeship scheme which  “will enable people who need to work across multiple projects with different employers to benefit from the high quality long-term training that an apprenticeship provides”.

“Employers themselves will also benefit from access to a diverse apprenticeship talent pipeline,” according to the Budget.

The furlough scheme has also been extended until September.

Apprenticeship providers have welcomed the boost, hailing it “exactly the type of support that young people need to secure a job opportunity as we emerge from lockdown”.

Jane Hickie, chief executive of the Association of Employment and Learning Providers, said: “With the continued shelter offered by the furlough scheme, employers and training providers can work closely together to take full advantage of the incentives. Furlough also keeps thousands of existing apprentices in jobs who otherwise might have been at risk of redundancy.

“However, there is a case for channelling increased apprenticeship support towards 16- to 24-year-olds only, because that is where the support is really needed and where the stimulus is required.”

David Robinson, director of post-16 and skills at the Education Policy Institute added: "The new ‘flexi-job’ apprenticeship may prove positive for young people, allowing them to accrue important skills and experiences in a number of roles within one sector. It will be important to closely scrutinise the details of this new scheme, including how it will be implemented.  

"Proposals to increase employer subsidies for both adult and younger apprentices will no doubt open up opportunities for many people, but given we know that it is apprenticeships and employment opportunities for younger people that have been disappearing the fastest, they should be receiving a far greater share of these subsidies. 

"However, funding for further education remains historically low and educational inequalities in the 16-19 phase are substantial. We need to see a more enduring financial settlement for the further education sector, together with a Student Premium that provides more targeted support to the most disadvantaged." 

Carole Willis, chief executive of the National Foundation for Educational Research (NFER), called for support for employers to improve take-up of opportunities by trainees.

She said: “We know existing incentives in this area have generated limited take-up. It is therefore likely employers, particularly small and medium-sized organisations, will require more support.

“We also welcome the recently announced school recovery funding package during a hugely challenging time for teachers, parents and pupils. This is a good start, but we believe more support will be needed to help all pupils, particularly those from disadvantaged backgrounds, to recover.

“The government’s priority to level up school funding has meant the most disadvantaged schools are receiving the smallest increases in their budgets at a time when they face a disproportionate challenge in supporting pupils with their learning. We believe this policy should be re-evaluated in light of the pandemic’s impact.

“Covid-19 has placed significant financial pressures on schools, and led to substantial losses in income. Not all schools will be able to meet these pressures through existing reserves or recent funding increases. There is a risk some schools will need to divert resources, which could be used for teaching and recovery, or place additional pressures on their workforces to meet these needs.”

In his response, leader of the opposition Keir Starmer questioned the lack of support for the government’s Kickstart jobs scheme announced in July last year to boost employment opportunities for 16- to 24-year-olds.

Starmer highlighted that just 50,000 people had been engaged by the scheme while only 2,000 currently placed in 120,000 jobs created by it.