Vince Cable: SMEs need more help with apprenticeships

Tom Newcombe,

Business secretary Vince Cable wants to encourage more SMEs to take on apprentices after admitting there has been a "very low up-take".

Cable was speaking to HR magazine yesterday after an event to launch PwC's London Professional Apprenticeship (LPA) initiative.

He said apprenticeships are working well for larger companies that know how to "tap into support" from organisations such as The National Apprenticeship Service (NAS), but smaller companies need "a bit more help".

"For those SMEs who just take one or two people a year it's a big step, which is why we need to promote this idea," Cable said.

"At the moment there is a very low-uptake of apprenticeships among SMEs and it's something we would like to change."

Increased apprenticeship pay

Cable said the Government is thinking of ways to raise the minimum wage for apprentices, and still keep the schemes attractive to small employers.

He told HR that there is "clearly an issue" around the apprenticeship minimum wage, which at £2.68 is significantly lower than the national minimum wage of £6.31 for over 21s and £5.03 for over 18s.

"The problem is if we significantly boosted [the apprentice minimum wage] by law, then it would be a deterrent to all those SMEs who we are trying to get onboard," he said.

"So there's a tricky balance to be struck, and at the moment the real need is to get SMEs to offer apprenticeships and not just the larger companies."

Careers guidance

The business secretary also wants to improve careers advice in schools after accepting there is a "disconnect" between the support young people receive when leaving school and entering employment.

"There has been a falling away of careers advice in school; in some schools it's done very well in others it's non-existent," he said. "It's something we have to work on, as a lot of schools are just preparing students for A-Level and university by default and not making them aware of the other opportunities available."

The LPA programme

Cable's comments followed a speech at the London offices of PwC, where the LPA was launched.

The LPA aims to provide 250 apprenticeships to young Londoners in professional services roles. The LPA, which is developed by PwC, will receive £1.4 million from the Department for Business, Innovation and Skills (BIS), with PwC contributing £900,000.