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27 May 2019
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Phillip Hammond © Shutterstock
Chancellor announces measures to help businesses with apprenticeships © Shutterstock

14 March 2019 | Herpreet Kaur Grewal

Chancellor Philip Hammond has announced measures in the Spring Statement to help smaller businesses boost the uptake of apprentices and also reduce their energy bills.

He said the Budget 2018 set out how the government is "accelerating the shift to a clean economy, building on the Industrial Strategy, Clean Growth Strategy, and 25 Year Environment Plan". 

To build on these, the government is calling for evidence on a business energy-efficiency scheme to explore how it can support investment in energy-efficiency measures to reduce carbon emissions.

He also announced reforms to the apprenticeship system, saying that "from April 1st employers will see the co-investment rate they pay cut by a half from 10 per cent to 5 per cent, 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 per cent to 25 per cent". 

Karen Jones, group HR director at Redrow, said she "warmly welcomes" the Chancellor’s apprenticeships announcement to support more small businesses to take on apprentices. 

She added: "A significant 59 per cent of construction SMEs we asked in February this year said that this policy, when implemented, would lead to an increase in the number of apprentices employed in their business. Clearly, this move has the potential to boost apprenticeship numbers across the sector.

“But we want to see even more apprentices coming up through the system, and there is still more the government can do to help. Crucially, the government should consider expanding the remit for what levy funds can be used for. Vital aspects of hiring an apprentice, such as wages, statutory licences to practice, travel and subsidiary costs, as well as the costs for setting up an apprenticeship programme, are all the burden of the SME business. Introducing this flexibility would significantly ease the financial load of the small businesses themselves.

“With their entrepreneurial streak, apprentices represent the future of SMEs in this country, so it’s vital that we help construction SMEs operating in the UK to take on and train more, and that industry and educators are providing rigorous information to young people which helps direct the right people onto the right apprenticeship.”

The government has appointed Professor Arindrajit Dube to undertake a review of the latest international evidence on minimum wages to inform future National Living Wage policy after 2020.