What does Rishi Sunak’s summer statement mean for apprenticeships and traineeships?

College News and Communications
Tuesday, 14 July 2020 15:34

engineering stock apprenticeships

Rishi Sunak’s recent summer statement will see the government provide more support for employers who take on apprentices, young people and trainees. Although, any underlying rules and eligibility criteria are still to come.

South & City College will be watching this space closely and sharing any new developments as and when they happen. In the meantime, our Employer Engagement team have organised a webinar to talk through the developments and what they mean for employers.

“Apprenticeships, Traineeships and Young People – What Does the Summer Statement Mean?” will take place at 11am on Thursday 16 July and you can register in advance for the webinar.

Key parts of Sunak’s announcement include the new Kickstart Scheme and two new employer incentives for apprenticeships and traineeships.

The Kickstart Scheme is a £2 billion fund to create hundreds of thousands of high-quality 6-month work placements aimed at those aged 16-24 who are on Universal Credit and are deemed to be at risk of long-term unemployment. Funding available for each job will cover 100% of the relevant National Minimum Wage for 25 hours a week, plus the associated employer National Insurance contributions and employer minimum automatic enrolment contributions.

The college is awaiting confirmation on what is meant by ‘deemed to be at risk of long-term unemployment’ and how this will work for 16- and 17-year-olds who are unable to claim Universal Credit. Candidates through this scheme are not eligible for an apprenticeship.

To encourage apprenticeships, from 1 August 2020 to 31 January 2021 the government will pay employers in England £2,000 for each new under-25 apprentice they hire and £1,500 for each new 25+ apprentice they hire. These payments will be in addition to the existing £1,000 payment the government already provides for new 16-18-year-old apprentices, and those aged under 25 with an Education, Health and Care Plan (where that applies). Eligibility requires that the apprentice “must not have been employed by the employer within the six months prior to the contract start date”.

This takes the total incentive for taking on a 16-18-year-old apprentice to £3,000. However, as these incentives expire on 31 January, there is only a narrow window for employers to take advantage.

The government will also provide an additional £111 million this year for traineeships in England, in order to fund high-quality work placements and training for 16-24 year olds. This funding is enough to triple participation in traineeships.

A traineeship is a course with work experience lasting between 6 weeks and 6 months with a maximum of 240 hours of work experience. On completion there is an expectation that the candidate is offered an interview for a job or apprenticeship.

For the first time ever, the government will fund employers who provide trainees with work experience, at a rate of £1,000 per trainee. To ensure that more young people have access to high-quality training, the government will also improve provision and expand eligibility for traineeships to those with Level 3 qualifications and below. There is no limit on the number of incentive payments and all payments will be "made directly to employers in two equal instalments, where the apprentice is still in learning at day 90 and day 365”.

Questions? Register for our webinar today.

If you have questions on any of these schemes or about what the summer statement means for your business, make sure you register for our webinar – “Apprenticeships, Traineeships and Young People - What Does the Summer Statement Mean?” – taking place on Thursday 16 July at 11am.

After registering, you will receive a confirmation email containing information about joining the webinar.