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Rishi Sunak Promises to Create 20,000 Apprenticeships
UK Prime Minister, Rishi Sunak has pledged to create 20,000 more apprenticeships with a series of Government reforms, which includes fully funded training for young people, and cutting the red tape for small businesses.
The UK Government is pledging £60m of new investment for the next year in order to pay the full cost of apprenticeships for people aged 21 or under at small businesses from the 1st April. Sunak says that the reforms will “unlock a tidal wave of opportunity”.
The move, announced at a conference for small firms on Monday 18th March in Warwickshire, is designed to reduce the burden on employers, as well as providing young people with more professional training places.
Changes have been revealed for the apprenticeship levy, increasing the funding that companies paying the Government's apprenticeship levy can transfer to other businesses.
This is a change that has been called for by a long time by businesses and business groups, with millions of pounds being unspent and returned to the Treasury every year. Large businesses pay into the levy, and the aim is to great more opportunities and spaces for apprentices.
This change means that from the 6th April, businesses are able to share up to 50% of their unspent funds. This is up from the 25% that is currently transferable.
The Government believes that the £60m investment in apprenticeships, as well as the levy reform, will enable up to 20,000 more apprenticeships.
What do these changes mean?
These announcements made by Rishi Sunak have several potential benefits for both apprenticeships and small businesses.
The pledge to fully fund apprenticeship training for individuals aged 21 or under at small businesses is a significant investment in the development of young talent. Covering costs of training removes the financial barriers that might have previously stopped employers from getting involved in apprenticeship programs, encouraging more small businesses to take on apprentices which provides young people with much needed training opportunities to enhance their employability and career prospects.
‘Cutting the red tape’ for small businesses is expected to make administrative processes associated with apprenticeship programs easier and more streamlined. This means that potential burdens such as paperwork, compliance, and regulatory requirements are reduced when small businesses look to take on apprentices.
The changes announced to the apprenticeship levy represent a significant shift in policy that addresses longstanding concerns raised by businesses and industry groups. It’s a decision that aims to maximise how the levy is utilised, with the 25% increase that businesses can pass over allowing for greater flexibility in how levy funds are distributed. This allows more businesses to invest in apprenticeship programs.
Overall, the combination of fully funded training for young people, reduced administrative burdens for small businesses, and reforms to the apprenticeship levy is looks set to create a more supportive and productive system for apprenticeships in the UK. By unlocking financial resources, streamlining processes, and enhancing flexibility, these initiatives have the potential to enhance the growth of apprenticeship programs, benefitting both employers and aspiring professionals alike while contributing to the development of a skilled workforce for the future.
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