The chancellor is expected to announce measures to bolster opportunities for young people in this week’s budget. Photograph: Izusek/Getty Images View image in fullscreen The chancellor is expected to announce measures to bolster opportunities for young people in this week’s budget. Photograph: Izusek/Getty Images Apprenticeships Higher training costs for older workers risks plan to tackle youth jobs crisis, employers say Exclusive: Ministers planning overhaul of apprenticeship funding to increase cost of over-25s training, Guardian understands
Prefer the Guardian on Google Britain’s largest employers have told the government that forcing businesses to pay more to train older workers risks damaging its goal to tackle the youth jobs crisis.
The Guardian understands ministers plan to overhaul Labour’s apprenticeship funding scheme to increase the cost of training a worker over the age of 25 in England by 25%, to encourage firms to train young people instead.
Drawn up before Wednesday’s budget, the proposal, which was first reported last week, is expected to form part of the government response to Alan Milburn’s review into why so many young people are unemployed.
The chancellor, John Healey , is widely tipped to announce measures to bolster opportunities for young people to help the 1 million 16- to 24-year-olds not in education, employment or training (Neet) across the country.
However, business leaders urged the government to reconsider the plan to make training older workers more expensive.
“It will just mean opportunities are shifted around instead of creating new ones,” said Robert Halfon, a former Conservative skills minister who is now the executive director of policy at the manufacturing lobby group Make UK.
“We agree that getting young people back into employment and training is a moral and economic imperative. But making it more expensive for employers to train older workers isn’t the answer,” he added.
Calling on Healey to “break the cycle” of cutting and reallocating the apprenticeship budget in England, Halfon said the system was already struggling to deliver what businesses and young people need.
“If the government is serious about getting young people into good jobs and giving industry the skills it needs, it should use that opportunity to grow the number of apprenticeships available rather than restrict training elsewhere.”
Andy Burnham has placed youth jobs at the heart of his agenda, including sweeping changes to retool technical education and plans to reverse a 40% drop in youth apprenticeship starts over the past decade.
With over-25s accounting for more than half of new apprenticeship enrolments, ministers have been clear they want to rebalance the system towards supporting more younger people.
Under the latest proposal, which is yet to be finalised, employers would be able to fund the full cost of an apprentice under the age of 25 using the money they contribute to the growth and skills levy – the £4bn-a-year tax used to fund the national apprenticeship system.
View image in fullscreen Andy Burnham has placed youth jobs at the heart of his agenda, including plans to reverse the drop in apprenticeships. Photograph: Simon Dawson/No 10 Downing Street However, for an older worker, they would face a “co-investment rule” whereby levy funds would cover 75% of the costs. The rest would need to be covered separately.
Employers have for years been told they were free to spend their levy funds on training as they s…