BLOG: Chancellor's budget hints at loosening purse strings for employment and skills sector
Updated: Feb 13
The effects of the budget on the employment and skills sectors are always interesting and this week’s announcement by the Chancellor Philip Hammond in Parliament hinted at some possibly fascinating developments.
Overall, the budget has been more positive for the sector than in recent years.
There looks like being more investment as the Chancellor hints at a long-awaited loosening of the purse strings.
The details of Mr Hammond’s announcement hint at a couple of potentially headline developments.
Firstly, is this the start of the end to austerity?
And secondly, is the Chancellor trying to increase labour market activity to minimise any potential detrimental effects of Brexit?
Time will tell.
But in the mean time, I think the details of the budget will certainly help the employment and skills sector.
Probably the most interesting move is the decrease of the co-investment rate for those companies wanting to bring in apprentices. That has been reduced from 10 per cent down to 5 per cent which will save SMEs significant amounts, especially on multiple apprenticeships.
This will hopefully have a positive effect on sectors such as Health and Social Care, which have been significantly down on starts in recent years.
Secondly, there is good news for adults wanting to change their career path with a boost for a national re-training scheme. The Government is making £100m available for the first phase of the National Retraining Scheme and that will include a new Careers Guidance Scheme. This money is likely to be tendered for by companies who wish to deliver services.
Finally, it was interesting to note the pilot scheme launched in Greater Manchester which sees £7m match funding for on-the-job training to young people not currently in employment, education or training. It will be something to keep an eye on to see how successful that is and whether that could lead to further roll out in other geographies.