Government doubles payments to employers for hiring new apprentices

The Government has doubled cash incentives for employers to take on apprentices as part of a package designed to put skills at the heart of economic recovery.

Chancellor Rishi announced a generous increase in incentive payments in the 2021 budget, partly hoping to woo small businesses and employers new to apprenticeship schemes.

The Government will pay £3,000 to employers who hire a new apprentice between 1 April 2021 and 31 September. This applies whatever the age of the recruit.  

The new payment is double the previous sum of £1,500 per new hire or £2,000 for those aged 24 and under. The payment is also on top of the existing £1,000 employers are eligible to receive when they hire 16-18-year-old apprentices or those under 25 with an Education, Health and Care Plan.

By boosting financial support, the Government hopes to see a sharp uptick in the number of new apprenticeships. Only 25,420 employers have submitted claims for the bonus as of 1 February 2021, well below the target of 100,000

AAT welcomes new scheme

AAT CEO Mark Farrar comments:

“There is an opportunity for employers to plan ahead in recruitment and use these new incentives wisely to help their businesses.

“Even amid all the current challenges, businesses need to think ahead about how their skills needs can best be met.

“We all know apprenticeships are a great fit. They provide great productivity, great staff loyalty, and just as soon as employers are ready to go, they should do it.

“They don’t need to act right away, they just need to plan ahead and be ready to recruit nearer September to capitalise.

Help to Grow scheme

In a separate initiative, the Government will fund a new management programme to help develop leadership and business skills among 30,000 small and medium-sized business across the UK.

The courses will be developed in partnership with industry and will feature a 12-week programme delivered through business schools. Key features will be practical case studies and mentoring from experienced business professionals.

Portable apprenticeships

A  £7 million fund will be available from July 2021 to English employers set up portable apprenticeships.

This is a new idea that will help people who need to work across multiple projects with different employers – for example, in the TV and film industries, to benefit from the long-term high-quality training.

Employers will be invited to come forward with proposals for these so-called “flexi-job” apprenticeships, with the first schemes getting probably underway around January 2022.

David Nunn is Content Manager at AAT.

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