£725 million package of apprenticeship reforms unveiled
Following the Chancellor’s Budget in November 2025, the Government has announced a £725 million package of reforms to the apprenticeship system which will see 50,000 more apprenticeships and foundation apprenticeships being created over the next three years.
In a boost for small and medium-sized businesses (SMEs), the 5% co-investment rate for SMEs will be removed meaning that the full cost of apprenticeship training at SMEs will be covered by the Government for eligible apprentices under 25.
What is the apprenticeship levy?
There will be a “new wave” of foundation apprenticeships in sectors such as retail and hospitality and from April 2026, new short courses will be rolled out in cutting-edge areas including AI, engineering and digital skills.
The Government’s reforms are aimed at tackling the sharp decline in young people starting apprenticeships over the last decade, which have fallen by almost 40% since 2015/16.
The Prime Minister said: “It’s time to change the way apprenticeships are viewed and to put them on an equal footing with university. This is a defining cause for this government and a key step towards our ambition to get two-thirds of young people in higher-level learning or apprenticeships.”
This announcement follows the previous unveiling of an £820 million investment by the Government in a new “youth guarantee” scheme, which will offer guaranteed paid work to 18–21-year-olds after 18 months.
