Cameron promised in 2015 to use cash to retrain 22-to-24-year-olds who had been unemployed for more than six months

A Conservative party election pledge to spend £227m raised through bank fines on 50,000 new apprenticeships has not been fulfilled, an investigation by Whitehall’s spending watchdog has found.

The National Audit Office has also concluded that the government cannot confirm that the nearly £1bn recouped over the rate-rigging scandal has been used as intended.

A report released on Friday showed that £933m of a fund worth £973m had been allocated to charities, emergency services and the armed forces since it was set up to distribute cash from banks for the Libor and foreign exchange rate-rigging scandals since 2012.

David Cameron promised in 2015 to use more than £200m of the fines to retrain 22-to-24-year-olds who had been unemployed for more than six months.

In a widely reported speech during the general election campaign, he said: “We’re going to take the fines from the banks who tried to rig markets – and we’re going to use it to train young people and get them off the dole and into work.

“This is about taking money off those who represent Labour’s failed past; and giving to those who through their hard work and endeavour can represent a brighter Conservative future.”

However, investigators from the NAO have been unable to show that any of the apprenticeships promised by Cameron have been delivered.

The report concluded that civil servants could not show that the apprenticeships which were supposed to be funded had been set up.



“HM Treasury deducted £200m from the Libor fund total and included this as part of the overall apprenticeships budget. The Department for Education, now responsible for apprenticeships, was not directed to use the £200m to pursue a specific policy to deliver apprenticeships for unemployed 22–to-24-year-olds and cannot demonstrate whether 50,000 new apprenticeships for this group have been provided.”

Auditors said the money was given in November 2015 to the then Department for Business, Innovation and Skills. It was then placed within the overall apprenticeships budget that was then transferred to the DfE, they said.



Reacting to the report, the general secretary of Unison, Dave Prentis, said the “broken promise” showed the Conservative government could not be trusted. “Apprenticeships are crucial for boosting job prospects. These bankers’ fines must be used to create opportunities for those who need them most,” he said.

The report also claims the government has failed to keep track of the impact the money has had on good causes. The NAO said £196m of grants were handed out from the fund between 2012 and the end of 2015 without any terms and conditions.

It said: “HM Treasury and the Ministry of Defence cannot yet confirm that charities spent all grants as intended.”

Responding to the report, a DfE spokesperson did not challenge the NAO’s conclusion that the money was not spent on the apprentices identified by Cameron, but added that it was spent on the government’s main apprenticeship programme.

“The £200m in Libor fines allocated to the department in the 2015 budget has been invested in the government’s flagship apprenticeship programme. The funding is helping to create 3 million high-quality apprenticeship starts in England by 2020,” he said.