A £725 million package of skills reforms to the apprenticeship system with the aim of helping to tackle youth unemployment and drive economic growth, has been announced by the UK government.

The government says the reforms will create 50,000 additional apprenticeships and foundation apprenticeships over the next three years.

As part of the package, the government will also cover the full cost of apprenticeships for eligible young people under 25 at small and medium-sized businesses.

The announcement also emphasised that removing the 5% co-investment rate for SMEs means that the training costs for all eligible under 25 apprentices are fully funded, opening up thousands of opportunities for young people.

Lizzie Crowley, Skills Adviser for the Chartered Institute of Personnel and Development (CIPD), said:

‘Apprenticeship starts have been falling for years, limiting opportunities for young people and preventing organisations – especially smaller firms – from building the skills they need to boost performance.

‘Creating 50,000 apprenticeships and giving mayors a stronger role in connecting young people with employers is a positive step. And in a year of rising employment costs, fully funding apprenticeship starts for under-25s in smaller businesses will be welcome.

‘However, removing the 5% employer contribution alone won’t drive take-up. Cost is rarely the main barrier for smaller employers; the greater challenge is releasing staff for off-the-job training and having the management capacity to support apprentices effectively day to day. Without tackling those practical constraints, take-up is likely to remain limited.’

Internet link: GOV.UK CIPD website