Growth and Skills Levy: Apprentices
The question
To ask the Secretary of State for Work and Pensions, what criteria his Department will use to prioritise allocation of Growth and Skills Levy funding to sectors and apprenticeship standards to support (a) youth employment and (b) industrial strategy objectives.
Answered by Andrew Western
This Government is transforming the apprenticeships levy into a new growth and skills levy, which will deliver greater flexibility to employers in England, more opportunities for young people, and support the industrial strategy.
In August 2025, we introduced new foundation apprenticeships for young people in targeted sectors as well as shorter duration apprenticeships, and from April 2026 we will introduce new short courses, called apprenticeship units, in critical sectors including artificial intelligence and engineering.
We are expanding foundation apprenticeships into hospitality and retail from April and fully funding SME apprenticeships for eligible 16–24-year-olds from August.
We are also introducing a new incentive of up to £2,000 for SMEs that take on 16–24-year-old apprentices as new employees. The policy will take effect for those starting apprenticeships from 1 October 2026, as long as they have joined their employer within the past 3 months (i.e. from July 2026).
These measures are backed by record investment, with funding for the growth and skills levy in England increasing to £3.3 billion for the 2026-2027 financial year.
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