Chancellor Rishi Sunak is introducing new measures in a bid to increase the number of apprenticeships, including covering the entire cost of training for smaller businesses and reducing the amount of red tape associated with signing up. From 1 April, the government will cover the full cost of apprenticeships for those aged 21 or younger at small-size firms. Furthermore, ministers will increase the amount of funding that larger firms, who pay apprenticeship levies, can give to other businesses. The government will provide £60m in funding to enable these moves. Sunak expects these measures to allow for up to 20,000 more apprenticeships.
Sunak will make the announcement today in a speech to small businesses. He stated in advance that the measures will “unlock a tidal wave of opportunity and make a real difference to businesses and entrepreneurs across the country.”
Business groups have welcomed the moves. The apprenticeship levy was introduced in 2017 but there have been calls for reform with many millions of pounds marked as remaining unspent. From 6 April companies will be able to give up to 50% of such funds to other firms, with the transfer cap having been previously set at 25%.
Sunak is also to announce a 50% increase in thresholds used to determine company size, which would enable an extra 132,000 companies to gain small or medium-sized enterprise (SME) status, potentially saving them £150m annually. The threshold increase, coupled with other changes to streamline reporting requirements, is expected to come into effect later in the year.
Shadow business secretary Jonathan Reynolds said that small business leaders had indicated that operating was becoming increasingly challenging under the Conservative administration. Reynolds added that Labour would resolve issues such as business rates, late payments, boosting exports and enhancing small businesses’ chances of winning public contracts
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