Government Introduces Bursary Scheme for Parents of Apprentices

New Delhi, India Jul 28, 2026 ALN: Some parents on benefits will be given up to £4,500 a year to encourage their children to start apprenticeships, the government has said.

Under plans to encourage young people into work, families will be offered a bursary to replace Universal Credit payments lost by starting jobs. This initiative comes in response to ongoing concerns about youth unemployment and the barriers that the current benefits system poses to young individuals seeking to enter the workforce through apprenticeship programs.

The payment is expected to benefit an estimated few thousand households, who currently face losing between £17 and £330 a week if their children start apprenticeships. This financial disincentive has been a significant barrier for many families, particularly those who rely on benefits to support their household income.

The Conservatives welcomed Prime Minister Andy Burnham's support for apprenticeships, but criticized his plans to fund the bursaries. The debate surrounding the funding of this bursary scheme highlights the broader discussions about government spending priorities and the allocation of resources within the welfare system. Critics argue that the funding could be better utilized in other areas, while supporters believe that investing in apprenticeships is crucial for the future of the workforce.

The bursary will be paid for from a £30m pot, funded through the growth and skills levy, a tax on employers with annual wage bills over £3m. This funding mechanism is designed to ensure that the costs associated with the bursary do not come from existing welfare budgets, but rather from a specific tax aimed at larger employers. This approach could be seen as a means to promote corporate responsibility, encouraging businesses to contribute to the development of the workforce.

This initiative follows the publication of a Social Security Advisory Committee report, which warned of the "perverse effects" of the benefits system on young people's employment choices. The report highlighted that the current structure of benefits often discourages young people from pursuing job opportunities that could enhance their skills and employability, ultimately leading to a higher number of individuals classified as Not in Education, Employment, or Training (Neet).

For instance, single parents with a disabled child could lose up to £340 per week in benefits if their child started an apprenticeship, exceeding the expected apprenticeship salary of £258 per week. This situation illustrates the challenges that families face when navigating the benefits system, where the potential loss of income can deter parents from encouraging their children to pursue valuable work experience through apprenticeships.

Because apprenticeships are classified as paid employment, benefit payments are reduced for households where young people take on these roles. This classification has been a point of contention, as it creates a disincentive for families to support their children in seeking apprenticeships, which are intended to provide both education and practical experience in the workforce.

The committee indicated that the current system hampers government efforts to reduce the number of young people not in education, employment, or training (Neet). A recent report by former Health Secretary Alan Milburn warned that one in six young people could be Neet in the next five years unless urgent action is taken. This statistic underscores the urgency of addressing youth unemployment and the need for targeted interventions to support young people in their transition from education to the workforce.

Official figures show that more than a million people aged 16 to 24 are currently Neet. This demographic represents a significant portion of the population that is not engaged in either educational pursuits or employment, highlighting a critical area for policy intervention. The government stated that its new bursary would eliminate a barrier to young people taking on apprenticeships, allowing them to "earn and learn" without the fear of losing essential financial support.

Work and Pensions Secretary Pat McFadden said: "By providing bursaries to those who need them most and fully funding apprenticeship training, we are making sure cost is not the reason someone misses out." This statement reflects the government's commitment to ensuring that financial barriers do not prevent young people from accessing valuable training opportunities that can lead to sustainable employment.

This initiative is part of a wider package of support for apprenticeships, which includes funding for apprenticeship training for under-25s and additional support for employers taking on apprentices. The comprehensive approach aims to create a more favorable environment for apprenticeships, addressing both the needs of young people and the demands of employers seeking skilled workers.

Helen Whately, the Shadow Work and Pensions Secretary, expressed her agreement with Burnham, stating: "I'm glad Burnham agrees: apprenticeships are a good thing, and we need more of them." However, she criticized the plan as "uncosted." This critique raises important questions about the sustainability of the bursary program and whether the government has adequately planned for the long-term financial implications of this initiative.

"It is spending money already committed elsewhere. So, either it is another unfunded announcement, or Andy Burnham is not being straight with us about his plans," she added. This skepticism reflects a broader concern among some policymakers regarding the transparency and accountability of government spending, particularly in relation to social welfare programs.

Burnham has stated he is "on a mission" to reduce the number of Neets, emphasizing the need to stop the rising trend. His commitment to addressing youth unemployment is part of a larger political agenda that seeks to revitalize the economy and ensure that young people have access to meaningful career opportunities.

As part of his early policy announcements, Burnham outlined plans to balance the education system by prioritizing both academic and technical skills. This dual focus aims to equip young people with the diverse skill sets necessary to thrive in a rapidly changing job market, where technical proficiency and practical experience are increasingly valued by employers.

The introduction of the bursary scheme for parents of apprentices represents a significant step towards addressing the challenges faced by young people in accessing apprenticeship opportunities. By mitigating the financial risks associated with starting an apprenticeship, the government hopes to encourage more families to support their children in pursuing these valuable career pathways. The implications of this initiative could be far-reaching, potentially leading to a decrease in youth unemployment and an increase in the number of skilled workers entering the labor market in the coming years.

Ultimately, the success of the bursary scheme will depend on its implementation and the extent to which it effectively addresses the barriers that currently prevent young people from engaging in apprenticeships. As the government moves forward with this initiative, ongoing evaluation and adjustment will be crucial to ensure that it meets the needs of both young people and the employers who are integral to their training and development.