Fund 100,000 young apprenticeships: calculation note

Central fiscal result

+GBP 0.5bn - Net fiscal impact in 2028-29

Low case: -GBP 0.2bn. High case: +GBP 1.5bn. Positive numbers are fiscal costs or borrowing pressure. Negative numbers are Exchequer savings or receipts.

Scenario and baseline

• Model 100,000 additional 18-21 apprenticeships by 2028-29.
• Central cost assumes GBP 5,000 average support before offsets.
• Baseline uses DfE apprenticeship starts and participation.
• First Job Bonus is modelled separately.

Affected population

• Affected population is young apprentices and participating employers.
• Direct count is 100,000 additional starts in central case.
• Indirect exposure includes training providers and competing workers.
• Completion rates determine longer-run benefits.

Gross impact

• Gross support: 100,000 x GBP 5,000 = GBP 0.5bn.
• Central offsets are small in the first year.
• Low case assumes wage and benefit offsets exceed admin costs.
• High case assumes lower additionality and higher provider costs.

Fiscal build-up, central case

• Apprenticeship support payments: +GBP 0.5bn
• Training administration: +GBP 0.1bn
• Tax and benefit offsets: -GBP 0.1bn
• Provider capacity costs: GBP 0.0bn

Central net impact: +GBP 0.5bn in 2028-29.

Behaviour and pass-through

• Low case assumes high additionality and quick employment offsets.
• Central case assumes moderate additionality and completion rates.
• High case assumes deadweight and provider capacity costs.
• Employers may substitute subsidised apprentices for other entry-level staff.
• Productivity gains are not scored as near-term fiscal savings.

Phasing

• 2026-27: +GBP 0.1bn. Preparation or partial implementation.
• 2027-28: +GBP 0.4bn. Main ramp-up year.
• 2028-29: +GBP 0.5bn. Target-year central estimate.
• 2029-30: +GBP 0.5bn. Continuation at steady-state assumptions.

Main source groups

• con-plan-2026: Conservative live policy page; used to identify current pledge wording.
• con-student-2026: Conservative student-loan announcement; used for Plan 2 and apprenticeship scenarios.
• dfe-apprenticeships-2026: DfE apprenticeship statistics; starts and participation baseline.
• dfe-apprenticeships-2025: DfE annual apprenticeship data; full-year starts cross-check.
• obr-efo-mar-2026: OBR March 2026 forecast; fiscal and macro baseline.
• wolter-ryan-2011: Apprenticeship economics; informs behavioural and incidence assumptions.
• dearden-reed-vanreenen-2006: Training and productivity; informs behavioural and incidence assumptions.