Budget 2014: Extension to apprenticeship grant scheme proves popular policy

George Osborne's Budget pledge to extend a scheme that provides employers with a grant for each apprentice they train has been well received by business commentators.

The Apprenticeship Grant for Employers scheme (AGE) ensures that employers that have not had an apprentice in the last 12 months can access a £1,500 grant for each of up to ten apprentices aged between 16 and 24 that are taken on.

The AGE grant will be extended to December 2015 to support 100,000 additional apprenticeship programmes, and from January 2015 the initiative will be exclusively for small employers (fewer than 50 employees).

Brandan Flattery, CEO of Sage, says that with youth unemployment remaining a major challenge in the UK it is encouraging to see the Chancellor taking steps to address it.

‘Extending the grant for an additional 100,000 apprenticeships, combined with abolishing National Insurance contributions for under-21s by 2015, are two significant measures that will make it more affordable for small firms to employ young people,’ he says.

According to Sage research, less than one in five small businesses currently employs an apprentice.

‘It is only right the future entrepreneurs and business leaders of our country are given every opportunity to get an early foot onto the career ladder and today’s announcement should help them achieve it,’ adds Flattery.

Sara Caplan, partner in the education and skills division of PricewaterhouseCoopers adds, ‘It’s particularly helpful to SMEs as it will subsidise wage costs whilst someone is training. Their role in apprenticeships is important, because it’s creating sustainable skills and nationwide economic development.’

Phil Orford, of the Forum of Private Business says, ‘This [extension] was a central ask of our budget submission; ensuring small businesses have the skills they need is essential to creating sustainable growth.

‘Small businesses’ access to apprenticeship programmes must continue to remain at the forefront of the government’s mind as it proceeds with its programme of apprenticeship reform.’

Amit Bhatia, chairman of Hope Construction Materials says, ‘As the head of a business which has a strong focus on getting more young people into a profession, I believe it is something which will see real, long-term gains to employment.’

Further reading on apprenticeships

Ben Lobel

Delphine Hintz

Ben Lobel was the editor of SmallBusiness.co.uk from 2010 to 2018. He specialises in writing for start-up and scale-up companies in the areas of finance, marketing and HR.