The Kickstart scheme and the £3,000 cash incentive for businesses to take on an Apprentice have both been extended until January 2022, and there are currently calls from both government and industry for this to be extended even further.
The Covid-19 pandemic has led to unprecedented government funding, grants and loans for UK businesses. Here we take a look at the schemes for Kickstart vs Apprenticeship schemes, the two we are most often asked about.
What is Kickstart?
The Kickstart Scheme provides funding for employers to create job placements for 16 to 24 year olds on Universal Credit. It is designed to take young people who are unemployed, and on Universal Credit, and get them into work.
The government will cover the full salary costs of eligible employees equivalent to the National Minimum Wage (or the National Living Wage depending on the age of the participant) for 25 hours per week for a total of 6 months. The government will also cover associated Employer National Insurance Contributions and minimum automatic enrolment pension contributions.
Who is eligible for Kickstart?
The key criteria is that you must be a Limited Company (sole traders are not allowed) or a registered Charity. You must have been trading for at least 12 months and have accounts registered with Companies House. You can find more detailed information on eligibility here.
Is Kickstart good for small businesses?
The Kickstart Scheme is ideal for employers looking to give someone a chance and test them out.
Initially there was a 30-person threshold, but in good news, this was scrapped in February. That means small businesses no longer need an intermediary to access the incentive for one or two placements.
The financial commitment is low, but keep in mind that someone who has been on Universal Credit for more than 6 months may require a bit of extra support re-entering the workplace.
If you don’t have time to really nurture new employees, there are organisations throughout the country like EmployabilityUK who can offer support.
What is the Apprenticeship incentive?
There are more than 600 Apprenticeship standards from degree-level accounting to cyber security and digital marketing. Far removed from the apprenticeships of old, this new breed of workplace training is designed to upskill workers of any age in order for UK business to thrive.
If your business is registered in England, has less than 100 employees and your apprentice is a PAYE employee, then the apprenticeship is 95% government funded. In addition, Rishi Sunak will give you £3,000 to say thank you. This is payable in two instalments, at 90 days and 365 days.
In addition, if your apprentice is under 25, then you don't pay Employer’s NIC. This means that on a salary of £16,000, you’ll save about £1,300 per year.
Who is eligible?
- Business registered in England (there are separate schemes for Wales, Scotland and Northern Ireland)
- Less than 100 employees
- New PAYE employee
- Aged 16 or over (no upper age limit)
Apprentices on our Digital Marketing Academy
Are apprenticeships suitable for small business?
Yes. An apprenticeship is a terrific way to bring a young person into a small business in a way that they’re supported. Good programmes include regular coaching and a bespoke plan for both the apprentice and your business.
There is a tendency for businesses to employ somebody who's already been tested, who’s already done the job - that’s human nature. However, particularly for jobs at the beginning of your career, having done a bit beforehand doesn't always mean a lot.
For example, the pandemic has seen a lot of talented graduates coming into our Digital Marketing Academy apprenticeship programme. They have degrees in graphic design or videography, but they’re working in hospitality or retail, and having trouble getting that first career job. The Academy teaches these graduates to apply their content creation skills in a business context. Now they’re creating campaigns, redesigning websites and thriving. The same is true for many other apprenticeship standards.
For small businesses, it can be a bit scary bringing someone new in, there are often concerns it will take up too much time. In those cases, having a training provider with a thorough coaching and training programme can be hugely beneficial.
The incentives are designed to encourage businesses to take the plunge and take on somebody new. A 95% funded apprenticeship programme, £3,000 cash incentive and potential saving on Employer’s NIC, adds up to quite a lot of financial and training support.
Can I put a Kickstart employee on an apprenticeship?
No. However, if you find yourself impressed with one of your Kickstart recruits, you may consider enrolling them in an apprenticeship when they finish their six month period.
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