Under the plans, companies will be able to design, develop and buy the vocational training that most suits their needs instead of having to buy ‘off the peg’ training from colleges and other training providers.
Businesses of all sizes and from all sectors will be able to apply for a share of £50m in the first year of the scheme, which starts in the New Year, with another £200m available in the second year.
By 2014-15, the Government wants to see 400,000 apprentices starting every year in the UK, up from last year's figure of 279,900. And professional bodies see that the only way forward is to give employers more control over the training.
Speaking of the plans, Prime Mnister Davd Cameron said: “I know times are tough – especially for young people – who are trying to get their foot in the door and launch their career.”
“That is why I am determined to do all that we can to give people the very best skills, training and opportunities to succeed; and why despite tough spending decisions we are investing in record number of apprenticeships.....giving employers the power to take control of the training so that it best meets the skills they need.”
The scheme will be unveiled a day after Business Secretary Vince Cable announced an incentive scheme worth up for £1,500 for small businesses employing fewer than 50 staff to encourage them to take on more apprentices.
Mr Cable said: “We have to fundamentally alter the relationship between employers and the state – giving employers the space and opportunity for greater ownership of the vocational skills agenda, including the chance to bid for direct control of public funds.”
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( 3 / 145 )In figures revealed today, the Consumer Prices Index fell from 5.2 per cent to 5 percent in October, more of a drop than analysts had expected but in line with Bank of England Governor, Sir Mervyn King’s prediction that “the squeeze would begin to ease”.
The biggest supermarket price war in 15 years was the main reason for the fall in inflation; food prices fell by 0.9 per cent over the month due to “significant and widespread discounting by supermarkets,” according to the Office for National Statistics (ONS).
However, some analysts believe that the fall in inflation will not be as dramatic as the Bank Governor has predicted; Sir Mervyn has said that inflation will be back around its target rate of 2 per cent by the end of next year.
In his letter to the Chancellor today, he said: “The Committee’s best collective judgement is that inflation will fall back sharply in the next six months or so, and continue falling thereafter to around target by the end of next year.”
A number of analysts are citing a rise in “core inflation”, which will keep rates higher for a while. Scotia Capital’s Alan Clarke said: ““A number of influences are likely to limit the extent of the slowdown in inflation.”
And Simon Hayes of Barclays Capital commented: “ One niggling concern I think is about the rise in core inflation that we say, because the fall in inflation that we are predicting for next year s partly about VAT, is partly about gas and electricity prices, but it is also driven by the weakness in the economy pulling down on inflation and there’s not a lot of evidence in the recent data that is actually happening.”
However, the fall is good news for cash-strapped household and the Government. A Treasury spokesman said: “The Government is taking action to help by increasing the personal tax allowance and freezing council tax, having also cut fuel duty."
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( 3 / 148 )Figures just released by the Bank of England show that the UK’s biggest four banks increased their lending to companies in the third quarter of this year but lending to small and medium-sized businesses (SMEs) fell to £18.8bn from £20.5bn in the 2nd quarter.
Under the Project Merlin agreement, the banks need to lend £32.3bn in the last three months of the year to meet their overall target of £190bn and to meet the target of £56.1bn to SMEs, they must loan almost £20bn between now and the end of December.
John Walker, national Chairman of the Federation of Small Businesses, said the banks had "yet again missed the small business target,” adding that the lending targets failed to address the "lack of competition" in the banking sector.
"We need to see a clear change: more competition and new lines of credit opening for small firms if they are to help boost the recovery," he said.
And Brian Berry, Director of External Affairs at the Federation of Master Builders commented: "Despite the new figures on lending through Project Merlin showing that the UK’s major banks lent £18.8bn to SMEs in the third quarter of this year, our members are telling us they are still finding it difficult to access finance.
The BoE figures tally with those issued by the BBA, the trade association for the banking sector. A BBA spokesman said: "The Merlin banks are on track to meet their business lending commitments... However, the overall economic environment remains challenging and business demand remains weak."
The figures come as a Bank of England director called for a loosening of bank lending rules. Andrew Haldane, the Bank of England's executive director of financial stability, said that rules that hold back lending to small businesses should be relaxed when the economy is faltering.
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( 3 / 129 )Chris Lucas, Barclays Financial Director has called for an overhaul of “opaque and complex” accounting rules, in a letter published in the Financial Times today.
In his letter, Chris Lucas criticises the “fair value accounting of own debt” which boosted the third-quarter results of several major banks, including Barclays, because the gain is based on the deteriorating market value of debt, a price at which a bank could theoretically buy back the debt.
Mr Lucas claims that these unresolved flaws in the IAS 39, “It makes results difficult to explain to investors and is unhelpful for an industry that wants to rebuild confidence through transparency in financial reporting.”
He goes on in his letter to urge stakeholders to amend IAS 39, saying this will "improve investor confidence and increase transparency in financial reporting by banks.”
IASB, the Standard Setter, is working on new rules, but they are proving controversial and the task is further complicated by attempts to coordinate with US equivalent the FASB.
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( 3 / 67 )The Institute for Public Policy Research (IPPR) has published a report saying that apprenticeship schemes are not helping enough young people find employment and that government funding is often used to help employers train the over 25s.
Apprenticeships were initially set up to help young people in the 16 to 24 age bracket find employment and training but, according to the report, only 37,000 of the 126,000 extra apprenticeships created last year went to people in that age range.
The IPPR said that the apprenticeship “brand” should be reserved for young people but that the figures showed a different story; the rise in apprenticeships for the over 25s increased by 257 per cent, while for 19 to 24 year old the rise was 22 per cent and only 10 per cent for 16 to 18-year-olds.
IPPR Director, Nick Pearce said: “Apprenticeships can help young people break out of the unemployment trap by offering additional general education, the chance to learn the soft skills that employers often demand, and specific job-related training.”
The current system is that funding goes to training providers, who help to find and then administer appropriate apprenticeships. Mr Pearce believes that channeling more funding directly to employers would help to overcome employers’ reluctance to take on school leavers.
While the Department of Education defended the Government’s record on apprenticeships, a spokesman for them said: "The figures show that the number of 16-18-year-olds not in education, employment or training (NEET) continues to fall - but the number of teenagers who are NEET is still too high.
"We want every 16 and 17-year-old to achieve, which is why we are increasing apprenticeships and transforming vocational qualifications.
"We're raising the participation age to 18 by 2015 - whether that be full-time education in a school or college, an apprenticeship or full-time work or volunteering with part-time training alongside it."
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