Help firms take on apprentices says Sugar

Lord Sugar called today for tax breaks or other financial incentives for firms to take on more apprentices and warned against cutting funding for such schemes.

The entrepreneur, Labour peer and star of BBC1's 'The Apprentice' said the idea would be more cost-effective than funding vocational courses at further education colleges.

He told peers: "Young people will get far more satisfaction and motivation from actually working in a firm rather than sitting in a classroom theorising."

The former Downing Street adviser noted that UK numbers of apprenticeships had risen from 60,000 when Labour came to power in 1997 to 250,000 in May last year, with an "encouraging" completion rate of around 70%.

The pre-election promises of the current Government to create 400,000 apprenticeships over the next two years had since been "somewhat watered down", he said. He also warned ministers against "undoing all of that work of the past".

"The proposed Government cuts should not be directed at this sector," said Lord Sugar. "Cutting funding for training would be a repetition of the mistakes during the last recession."

As Gordon Brown's enterprise champion, he had resisted calls from employers for financial incentives for taking on apprentices. He has since changed his mind.

Lord Sugar said he questioned the value of full-time college courses in manufacturing or any other physically skilled trades.

But apprenticeships also cost the time of trained staff to act as mentors, he said, during a Lords debate on apprenticeships in the public and private sectors.

"In this day and age, when most businesses are having to tighten their belts and fight their way out of the recession, they can ill afford to have their staff deflected," said Lord Sugar.

He urged the Government to divert money from "training facilities" to employers, by way of tax breaks or grants for taking on apprentices "instead of blowing it on these so-called further education facilities".

Vocational courses did not always succeed as well as on-the-job training in keeping young people off the street, he warned. "The end product in many cases is still unemployable and unskilled."

Lord Sugar went on: "Young people would have greater dignity if they were taken into a firm and given a real goal to aim for, but didn't expect firms to do it for nothing."

Anyone who regarded apprentices as cheap labour was, he said, "totally deluded". He urged the Government to ensure that its contractors employed a set proportion of apprentices.

Junior skills minister Baroness Wilcox, replying to the debate, stressed the continuing need to expand the number of apprenticeship places on offer.

She saw a need to make it easier for employers to offer apprenticeships "by improving the information available to them and cutting unnecessary red tape".

Ministers also hoped to reach a consensus on the right funding model in current economic circumstances and the "right division of costs" between Government, employers and learners.

The minister added: "The Government and the public sector more widely wield significant influence through the contracts it negotiates.

"And this Government is interested in looking at what more can be done to encourage employers with public sector contracts to consider the skills needs of their workforce."

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