BIFIS welcomes Government announcement on apprenticeships

The British Institute of Fitted Interiors Specialists (BIFIS) has welcomed the Government’s decision to provide additional support for small and medium-sized enterprises (SMEs) that take on young apprentices through the non-levy funding system.

The Government has announced a new incentive of up to £2,000 for non‑levy paying employers (typically SMEs) who take on 16–24‑year‑old apprentices. This incentive applies to apprentices starting from 1st October 2026, provided they joined the employer within the previous 3 months (from July 2026).

The initiative aims to reverse the decline in young apprenticeship starts, contribute to the creation of 50,000 more apprenticeships, and support the broader Youth Guarantee. SMEs, who employ a high proportion of young apprentices, are expected to benefit from support towards the additional costs associated with employing young people.

Financial incentives available include:

• ● £1,000 payment for hiring apprentices aged 16-18, or 19-24 for those with an EHCP or who are care leavers – paid in 2 instalments at day 90 and one year after the start (or day 242 for shorter programmes). 
• ● £2,000 foundation apprenticeship incentive for apprentices 16-21 (or 22-24 for those with an EHCP, care leavers, or prison leavers) – paid at day 90, day 242, and on progression to the next apprenticeship. 
• ● £2,000 new SME hiring incentive (from October 2026) for apprentices aged 16-24 – paid at day 90 and day 365 (or day 242 for shorter apprenticeships). 
• ● £3,000 Universal Credit hiring incentive (from June 2026) for employers hiring apprentices aged 18-24 who have been on Universal Credit for more than 6 months – paid in 2 instalments in months 1 and 3.

Additional support for under‑25s includes no employer National Insurance contributions, 100% training costs covered for eligible non‑levy apprentices, and a £3,000 bursary for care leavers starting an apprenticeship.

The updated incentive aims to make it easier for smaller employers to bring young people into skilled trades by reducing the upfront financial burden and streamlining access to apprenticeship funding. This step forms part of a wider government effort to increase participation in apprenticeships and strengthen the skills pipeline across the UK.

Damian Walters, CEO of BIFIS, said: “Any support that makes it easier for SMEs to recruit and train young apprentices is hugely positive, and we welcome the Government’s recognition of the vital role small businesses play in developing the UK’s workforce. However, apprenticeships remain a significant financial commitment for SMEs, especially in the first year. If the Government truly wants to unlock the full potential of the apprenticeship system, it must go further in helping small employers cover the real costs of training and supporting apprentices on site.”

He added: “We’re working tirelessly with strategic partners, amplifying the voice of our industry, in lobbying Government to improve financial support for small businesses. There are swollen pots of unassigned levy funds that could be put to great work with the installer supply chain and whilst I’m pleased that extra support has been provided, the Government remains way behind in supporting small businesses to cover the full costs of taking on an apprentice.”

BIFIS continues to call for long-term, sustainable reforms that ensure SMEs, which make up the backbone of the UK’s construction and building services sector, can confidently invest in apprenticeships without facing disproportionate financial pressure and calls upon the industry to unite with the organisation to further strengthen its influence with UK Government.