he Chancellor, Rishi Sunak MP, used his second Budget to provide stability in the jobs market by extending the Coronavirus Job Retention Scheme (CJRS) until September 2021 and reaffirmed some of his key spending announcements on training support made at the Comprehensive Spending Review in December 2020.
Supporting jobs
The Chancellor pledged long-term job support by extending the Coronavirus Job Retention Scheme (CJRS) to September 2021, something the CBI called for in the lead up to the Budget. Employer’s contributions to non-worked hours will increase to 10% July, and then 20% in August and September. This is a welcome extension for businesses; stable employer contributions to non-worked hours until the end of June brings much-needed clarity that will enable firms to plan better for a gradual reopening of the economy.
The £2bn Kickstart Scheme was also reaffirmed, citing the progress made in creating 120,000 Kickstart vacancies with 33 employers since the scheme’s creation. However, the Chancellor missed the opportunity to extend the scheme, which has been favourable amongst employers. Instead, he reaffirmed commitments made at the 2020 Spending Review on the £2.9bn Restart scheme, which will launch in Summer 2021, and the £1.4bn commitment to increase capacity in Job Centre Plus and double the number of work coaches, 10,000 of which are now in post.
Apprenticeships
The Budget included two key announcements on apprenticeships, one extension and one new:
- Extending the apprenticeship bonus by six months and doubling the bonus to £3000
- A new £7m fund to set-up and expand ‘portable apprenticeships.’
The extension of the apprenticeship bonus will be welcome to firms who are planning to hire new apprentices over the next year, adding even further incentive through an increase in the amount firms are able to receive. However, the incentives are unlikely to shift the dial for those currently struggling to fund apprenticeships, particularly those facing coronavirus-related issues.
Additional funding from July 2021 will help employers in England set up and expand portable apprenticeships, allowing learners to work across multiple projects with different employers. Some sectors – including creative industries – have long called for a more flexible approach to apprenticeship delivery which better reflects the way in which many of their employees work. This announcement will be welcomed by some sectors and may encourage others to consider exploring the benefits of different approaches to apprenticeships.
However, overall the proposals set out do not go far enough on fundamental reform of the levy which we wanted to see, as called for in our Learning for Life report last year.
Training and careers guidance
New funding for traineeships was also announced, with £126m for training and placements for 16–24-year-olds in the 2021/22 academic year. The government will also invest £1.3m over 2021-22 and 2022-23 to pilot the use of new technologies to support in or out-of-work people to find new job opportunities which are best suited to their skills and experience. Whilst further detail is needed here, the CBI reskilling report, Learning for Life, proposed an idea similar to this, to create an online learning platform including a ‘skills taxonomy’, to identify skills demand and support individuals to match their skills to potential jobs.
The Chancellor also reaffirmed the government’s £138m commitment to fund in-demand technical courses for adults, and to expand the employer-led boot camp training model, in areas such as digital and technical skills. The CBI is currently exploring how this model could be applied to industries with pressing skill demands, such as in the green economy.
Management support
A new business support measure was announced today titled ‘Help to Grow’, providing support in two areas:
- A management programme to upskill 30,000 SMEs in the UK over three years
- A digital programme to help 100,000 SMEs save time and money by adopting productivity-enhancing software, transforming the way they do business.
Support to improve the UK’s people management practices, especially for SMEs, will be welcomed by business as it has been shown to have a huge impact on firm and UK level productivity. The CBI has demonstrated the importance of people management practices to productivity, and the benefit of peer-learning to improve them, in its Great Job campaign.
Immigration
The government announced changes to modernise the immigration system to help the UK hire global talent and provide practical support to small firms using the visa system for the first time. The government will publish a delivery roadmap in the summer.
Making the process of obtaining and maintaining a sponsor license easier is welcome and something the CBI has been calling for. Changes will be particularly welcome for SMEs who have not previously engaged with the points-based system. The CBI will consult with members to inform the government’s reform process.
What next?
Do get in touch with your thoughts and reactions to any of the announcements. Across the People and Skills team, you can contact the follow policy leads:
- Job Support – Anna Koch
- Skills – Nic Trower
- Immigration – Yusuf Ali-Hassan.
