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Chancellor’s Skills Boost for #PlanForJobs: Greater flexibility and more cash for Apprenticeships and Traineeships

Rishi Sunak with a Plan for Jobs background

Chancellor @RishiSunak bolsters #PlanForJobs – flexi-apprenticeships, £3,000 Apprenticeship fee and additional £126M for Traineeships 

New innovative flexi-apprenticeship programme (“Flexi-Job” Apprenticeships to start in Jan 2022) to allow people to work for a number of different employers in the same sector. Individuals will be linked to an agency, instead of a single employer, meaning they will be able to develop their skills by taking on different jobs with multiple employers in one sector. From July, employers will be able to bid for money from a £7m fund to create new agencies. 

Increased cash incentives for firms taking on apprenticeships: From April 1st 2021, the incentive scheme will be simplified and made more generous with a £3,000 payment per hire, regardless of the age of the Apprentice. 

£126m of new funding for 40,000 more traineeships. 

Tens of thousands more people will benefit from a multi-million-pound expansion of the Government’s Plan for Jobs, the Chancellor is expected to announce at next week’s Budget.

Rishi Sunak will give a boost to the existing apprenticeship and traineeship programmes in England by launching an innovative new “flexi-job” apprenticeship that will enable apprentices to work with a number of different employers in one sector. He will also pay up to double the current cash incentive to firms who take on an apprentice, and invest £126m of new money to enable 40,000 more traineeships.

Building on the Prime Minister’s ambition for more flexibility for apprentices, as set out in his Skills speech in September at Exeter College, the Chancellor’s new “flexi-job” apprenticeship programme will build greater flexibility into the system for employers and apprentices alike. Individuals will be linked to an agency, instead of a single employer, meaning they will be able to develop their skills by taking on different jobs with multiple employers in one sector. From July, employers will be able to bid for money from a £7m fund to create new agencies, with the first “flexi-job” apprenticeships expected to start in January 2022.

Apprenticeships are a job with training, and are known to work for people of all ages and backgrounds – 93 percent lead to work or further training. This pioneering scheme will be a welcome boost for industries with more flexible working patterns, such as the TV and film industry, who will be able to give apprentices greater experience across a wide range of productions.

The Chancellor is also expected to boost the cash incentives for businesses that give a job to an apprentice. A cash incentives for employers to hire apprentices from 1st April 2021 will rise to £3,000, regardless of age 

The Chancellor is also expected to boost the cash incentives for businesses that give a job to an apprentice. Currently employers receive a cash incentive of £2,000 for each apprentice they hire aged 16-24, and £1,500 for those over the age of 25. From April 1st the incentive scheme will be simplified and made more generous with a £3,000 payment per hire, regardless of the apprentice’s age. The scheme will also be extended for an extra six months to the end of September.

Rishi Sunak 100x100Chancellor of the Exchequer, Rishi Sunak, said:

“Our Plan for Jobs has spread opportunity and hope throughout the crisis – helping people back into work and harnessing their talents for the future.

“We know there’s more to do and it’s vital this continues throughout the next stage of our recovery, which is why I’m boosting support for these programmes, helping jobseekers and employers alike.”

Research shows that the appetite for apprenticeships and work-based learning is rising with 70 percent of employers saying they believe these programmes will be vital to their organisation’s recovery.

More than 40,000 extra young people in England will be able to benefit from the new £126m investment in traineeships, which are targeted at 16-24 year-olds who lack the skills, experience and confidence to start an apprenticeship or job. Traineeships last from 6 weeks to 12 months depending on need, and involve work experience, as well as English, Maths and digital skills training, to prepare them for the world of work.

At least three quarters of them are likely to move on to further work or training, and without this type of support the chances of these young people securing any meaningful employment in the long-term reduces significantly.

As the Government reaches its milestone of 10,000 new work coaches in Jobcentre Plus offices across Britain, the Chancellor is also expected to pilot new technologies to help jobseekers find the work that’s right for them. A small number of jobcentres will trial the use of new job matching solutions, giving work coaches more ways to identify a person’s skills and match them with a wider range of jobs across different sectors.

This latest Plan for Jobs support builds on the Government’s existing investment, which includes the £2bn Kickstart scheme, which has already created more than 120,000 opportunities for young people, and the £2.9bn Restart programme to support over a million unemployed people find work.

This additional boost will provide the tools to help people find new opportunities, upskill and improve their job prospects as we build back better from the pandemic and beyond.

The Chancellor’s announcement at Budget will see cash incentives for employers to hire apprentices from April rise to £3,000, regardless of age, with the scheme also being extended to the end of September. Currently, employers receive £2,000 for each apprentice they hire aged 16-24, and £1,500 for those over the age of 25. This is on top of the £1,000 payment provided for new apprentices aged 16-18 (and those under 25 with an Education, Health and Care Plan).

Last summer, the Plan for Jobs provided £111m for 36,700 additional traineeships in 20-21 and to pay employers £1,000 for work placements for trainees. At the Spending Review a further £58m was provided for the remainder of the 20/21 academic year, up to July. The Chancellor is now expected to provide an additional £126m to continue the expansion of traineeships for the full 21/22 academic year, including £22m to continue the employer incentive payment of £1,000. This will provide up to 43,000 placements.

Apprenticeships and Traineeships are devolved so these measures will apply in England only.

Sector Reaction to the Chancellor’s Skills Boost for Plan For Jobs: flexi-apprenticeships, £3,000 Apprenticeship fee from 1st April and additional £126M for Traineeships

Jane Hickie 20Dec 100x100Association of Employment and Learning Providers chief executive Jane Hickie said:

“The extension of the apprenticeship financial incentives until the end of September could be a game-changer and the increase in the incentives should prove to be particularly attractive to smaller businesses who have traditionally offered apprenticeship opportunities to young people. 

“The Chancellor’s championing of apprenticeships and traineeships throughout the pandemic has been appreciated by employer and training providers facing an extremely challenging environment and the Plan for Jobs puts skills at the heart of a sustainable economic recovery.”

and Jane continues

“These are welcome steps but if we were in the Treasury’s shoes, we would have channelled the increased incentives to focus on 16 to 24 year olds only, because that is where the support is really needed and where the stimulus is required.

“The flexi-job apprenticeship proposal, builds on a prior announcement about portable apprenticeships which the chancellor announced at the last spending review and looks like a rebadging of the existing Apprenticeship Training Agency (ATA) model.  It will be interesting to know whether the government regards the new agencies as a replacement for existing ATAs which are reliant on employer service fees and levy transfers.”

Stephen Evans Dec 2018 100x100Stephen Evans, Chief Executive of Learning and Work said:

“The expansion of traineeships and extra incentives for apprenticeships are welcome and contribute to tackling the rise in unemployment caused by the pandemic. It’s also great to see the Government getting an extra 10,000 Work Coaches into jobcentres.

“However, speed is of the essence: the extra traineeships announced last summer are yet to be delivered, so we need an urgent focus on action on the ground. And we need more clarity on how all these initiatives fit together: we have argued for a Youth Guarantee to ensure all young people are offered a job, training place or apprenticeship.

“The Plan for Jobs will make a difference, but with unemployment likely to rise further the Government will need to go further, including extending furlough support and Kickstart and keeping the uplift to Universal Credit in place.”

david hughes 100 x100Responding to the announcement of the government’s expansion of the Plan for Jobs, including the new flexi-apprenticeship programme, David Hughes, Chief Executive of the Association of Colleges (AoC) comments:

“This investment in the apprenticeship and traineeship incentives come at a crucial time for young people facing tough times in the labour market. It is vital that we continue to find ways to support young people who are amongst those hardest hit by the pandemic, but we must also ensure colleges have the flexibility and funding certainty to be able to meet skills needs more widely over the next few years.

“These short term measures are helpful, but not sufficient if we are to successfully build back fairer and better. I look forward to seeing strong investment in the Budget and the Spending Review later this year to back up the recent Skills for Jobs white paper which could be a game-changer for post-18 education and skills.”  

Sherry Coutu CBE, Non-Executive Director, Investor & Philanthropist said:

“The Chancellor’s ‘flexi-job’ apprenticeships announcement will enable Britain’s most innovative employers to offer apprenticeships that rotate between firms. This is hugely welcome, as it will help businesses that are scaling up to access high quality and diverse apprenticeship talent while also giving the apprentice themselves the skills and practical work experience they need to launch their careers.”

Euan Blair, founder and CEO, Multiverse, said:

“Apprenticeships provide an excellent route to some of the best careers in tech and professional services and are now an outstanding alternative to the best universities. By backing the employers creating more apprenticeships, these incentives should support firms to tackle critical skills gaps and help power the economic recovery.

“We’ve had over a hundred thousand applications for our recent tech and digital apprenticeships and some of the most talented people in the country are pursuing this route. It’s great to see apprenticeships playing a central role in the government’s thinking.”

Seetha Kumar, CEO, ScreenSkills, the UK screen industries’ skills body said:

“We welcome the new flexi-job apprenticeship which will enable suitable industry bodies to act as sector agencies. This will make it easier for smaller companies in particular to take on apprentices into the thriving screen industries. ScreenSkills is already planning an innovative programme along very similar lines, supported by DCMS, with important industry partners, so we look forward to working with government on making this proposal work to support our world-renowned film, television, visual effects, animation and games industries.”

Viren Patel, Director, The Open University said:

“The Chancellor’s announcement is a further boost for apprenticeships in England – for the individual, the employer and the UK economy. This simplified and more generous incentive scheme of a £3,000 payment per hire, regardless of the apprentice’s age, should help encourage more employers to think about hiring apprentices.”

Joe Fitzsimons, Senior Policy Adviser, Institute of Directors said:

“Directors will welcome the boost to apprenticeship incentives and flexibility. Skills gaps are a leading concern for business leaders, and apprenticeships are an essential part of the skills landscape. Allowing people to work for several different employers in the same sector will benefit both apprentices and employers, providing a broader range of expertise. Meanwhile, increased incentive payments will support firms as they look to rebuild their talent pipeline beyond the pandemic. Further support for traineeships also enables organisations to support young people at the earliest stages of their career.”

Harriet Finney, the BFI’s Director of External Affairs said:

“The Government’s initiative for flexi-job apprenticeships and traineeships is great news for smaller employers and for jobseekers looking to enter thriving industries. The creative industries is one of the UK’s fastest growing sectors delivering billions of investment to the UK economy and creating thousands of jobs. The demand for UK-made screen content has enabled the industry to get back up and running quickly towards the end last year supported by the Government’s production restart scheme, and shown how our sector has the potential to generate further employment and growth.”


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