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£700m of investment in apprenticeships announced for small firms

The Chancellor, Philip Hammond, reinforced the UK Government’s commitment to delivering more apprenticeships across the country as part of his Spring Statement 2019 speech.

In order to accelerate the creation of 3 million new apprenticeships, the Chancellor brought forward the £700 million package of reforms announced in his Autumn Budget 2018 to begin from the next financial year (2019/20).

The Government is keen to reduce the financial commitment that the UK’s army of small business owners must take when hiring apprentices.

The new package will halve the cost of apprenticeships for small firms, who currently pay 10% towards the cost of training apprentices. From 1st April 2019, this will be halved to just 5%.

When the Chancellor first announced the package of apprenticeship reforms in October, no start date had been given for the training cost reduction, leaving many small businesses frustrated at having to put their apprenticeship plans on hold.

In his Spring Statement 2019 to the House of Commons, the Chancellor said: “To help small businesses take on more apprentices, I can announce that I am bringing forward the £700 million package of reforms I announced at the budget to the start of the new financial year in April.

“From April 1st, employers will see the co-investment rate they pay cut by a half from 10% to 5%, at the same time as levy-paying employers are able to share more levy funds across their supply chains, with the maximum amount rising from 10% to 25%.”

Apprenticeships are a devolved policy. This means that authorities in each of the UK nations manage their own apprenticeship programmes, including how funding is spent on apprenticeship training. If you’re an employer with operations in Scotland, Wales or Northern Ireland, you may also want to contact your apprenticeship authority.

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