The Budget: Apprenticeships and Technical Education

Written by Calvin Bowers

Earlier this month, Rishi Sunak announced his budget for 2021, including apprenticeship budget updates.

As well as an extension to the furlough scheme, a freeze on Personal Allowances and an extension of the Universal Credit uplift, he announced some significant changes for the technical education world.

Apprenticeships and Technical Education: What Did the Government Announce?

Incentive Payment Increase

One of the most widely discussed elements of the Budget is an increase in apprentice employers’ incentive payments. Employers who hired an apprentice previously received £2000 for taking on an apprentice aged 16-24 and £1500 for an apprentice over 25. This figure has now doubled to £3000 for hiring an apprentice, no matter their age. This figure is per hire, and employers can hire as many new apprentices as they like. This increased incentive payment expires in September 2021.

This payment is on top of any other funding or payments available to apprenticeship employers.

If you are interested in hiring an apprentice due to the increased incentive payment, visit our guide for employers. We have information on finding training, apprenticeship standards, and the benefits to your business.

Flexible Apprenticeships

Another change for apprenticeships announced in the Budget is the promise of a £7 million investment in ‘Flexi-apprenticeships’ or ‘portable-apprenticeships’, starting in July 2021.

These new-style apprenticeships will allow apprentices to work for more than one employer in an industry at the same time. This will allow apprentices to gain even more experience and expand the breadth of their training.

Previously apprentices could ‘take apprenticeships with them’ from employer to employer if they changed their job. However, this announcement is different as it will allow apprentices to work in several different roles at one time.

Investment in Traineeships

Rishi Sunak announced a £126 million investment into traineeships for the academic year 2020/2021. He said that with this money, he aims to get an additional 40,000 traineeships and help more 16-24-year-olds to find high-quality work placements which will enable them to succeed in their career.

A traineeship is a short work placement and training course that aims to develop 16-24-year-olds. You can also do a traineeship if you are 25 and have an Education, Health and Care (EHC). They combine a short work placement of at least 70 hours with functional skills training to help young people secure a full-time job. They also support young people through job applications, CV writing and interviews.

Increased Minimum Wage

As well as the announcements in the 2021 apprenticeship budget, the government also announced they would be increasing the National Minimum Wage from April 2021. This increase will affect all age groups, including the apprenticeship wage.

The apprenticeship minimum wage was previously set at £4.15 per hour and will increase to £4.30 per hour.

If you want to know more about the apprentice minimum wage and how it applies to apprentices of different age groups, visit our guide for parents.

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Last Updated: Thursday September 14 2023
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