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Economic Growth: Greater London

Question for Department for Education

UIN HL1834, tabled on 7 July 2021

To ask Her Majesty's Government what assessment they have made of the report by London First Central Government's Role in Helping London Drive Recovery, published in May; and what plans they have to create a London Apprenticeship Fund targeted at small firms affected by COVID-19 to restart apprenticeship growth in the capital.

Answered on

21 July 2021

We welcome the report’s focus on the importance of business-led skills programmes in responding to the impact of the COVID-19 outbreak. Through our Plan for Jobs, we are supporting businesses to create employment opportunities and develop their skills bases as we build back better from COVID-19.

We are committed to supporting small and medium-sized enterprises (SMEs) across the country, including in London, to benefit from the high-quality training that apprenticeships offer. In the first half of the 2020/21 academic year (August to January), there were 18,400 apprenticeship starts in London.

For the 2021/22 financial year, funding available for investment in apprenticeships in England is £2.5 billion, double that spent in the 2010/11 financial year. As well as funding new apprenticeships in levy-paying employers, income from the levy is used to fund new apprenticeships in employers that do not pay the levy. These SMEs continue to be able to access funding for 95% of apprenticeship training and assessment costs, and can now reserve funding for up to 10 new apprenticeship starts in the 2021/22 financial year.

SMEs can also benefit from further funding through the receipt of levy transfers from larger employers who are able to transfer up to 25% of their annual levy funds. In August 2021, we will introduce a new online service to help levy paying employers pledge funds for transfer and find SMEs to receive their transfer. This will allow large employers to make greater use of their levy funds to support apprenticeships in their supply chains and help meet local and regional skills needs.

To further help businesses offer apprenticeships as new employment opportunities, we have increased our cash incentive payments to £3,000 for every apprentice they hire as a new employee from 1 April until 30 September 2021.

Given this existing commitment to supporting apprenticeships in SMEs, we have no plans to introduce a London apprenticeship growth fund.