The UK Government’s Autumn Budget 2025 has introduced significant reforms to apprenticeships, skills, and employer costs. These changes are designed to make it easier for businesses, particularly SMEs, to recruit, train, and retain young talent while reducing financial barriers.

Budget Highlights for Employers

• Fully Funded Apprenticeships for SMEs employing under 25 year olds
  From August 2026, small and medium-sized enterprises will no longer be required to pay the 5% co-investment for apprentices aged under 25. Training and assessment costs will be fully covered by the Government, removing a key financial barrier for SMEs.
• Employer National Insurance Contributions (NICs)
  Employers will continue to benefit from NIC exemptions for apprentices under 25, helping reduce salary costs. The Employment Allowance remains at £10,500, offering ongoing relief for eligible smaller employers.
• Youth Guarantee
  A total of £820 million has been allocated to ensure every young person aged 18–21 has access to college, an apprenticeship, or tailored job support. This initiative provides employers with access to a motivated pipeline of young talent.
• Growth & Skills Levy
  From April 2026, the Apprenticeship Levy will be reformed into the Growth & Skills Levy, introducing modular, stackable apprenticeship units. This will give employers greater flexibility to upskill staff in targeted areas while simplifying the system.
• Streamlined Apprenticeship Standards
  The Government has confirmed plans to rationalise apprenticeship standards, reducing duplication and complexity to ensure training remains relevant to business needs.

What This Means for Cheshire & Warrington Employers

These reforms represent a major opportunity for local businesses to strengthen their workforce, reduce recruitment costs, and access new training pathways. Whether you’re an SME looking to take on apprentices for the first time or a larger employer planning to use the Growth & Skills Levy, now is the time to prepare.

Contact the Cheshire & Warrington LSIP team today to discuss how these changes can benefit your business and to access tailored support to help you navigate the new system.

Email us : lsip@sccci.co.uk