There will be more support for small and medium sized enterprises (SMEs) offering apprenticeships after a government report found that many firms were ‘in the dark” about the benefits of such schemes.

SMEs lack awareness of how to recruit and train apprentices, according to the review published by jewellery entrepreneur Jason Holt.

He said that while 99 per cent of businesses in the UK were SMEs, fewer than 10 per cent employed apprentices – less than half the proportion of larger firms doing so.

“Whilst apprenticeships offer undoubted growth opportunities for businesses, not enough SMEs are taking advantage,” explained Holt. “This is because they have an outdated view of apprenticeships, are often in the dark, and frequently do not receive the specific training provision their apprentices need.”

In response, the government has announced a revision to the Apprenticeship Grant to Employers, which provides up to 40,000 grants of £1,500 to employers taking on a young apprentice aged 16 to 24.

The funding will now be delivered in one payment rather than two, employers will be able to claim grants for up to ten apprentices, and the financial incentive will be available to organisations with up to 1,000 employees.

Other measures outlined by the government include better information on how to source apprentices and influence their skills development, plus improving the performance of training providers.

Education secretary Michael Gove said: “[Holt] is certainly right that we need to give employers, and not training providers, the power and freedom to shape their apprenticeships, and make the process as simple as possible for every employer.”

But the Association of Employment and Learning Providers (AELP), whose members train 70 per cent of the apprentices in England, pointed out that over the past seven years the uptake of apprentices had grown substantially and success rates had also doubled to 76 per cent.

AELP’s chief executive Graham Hoyle added: “Arguably the best thing to come out of this review is Jason Holt’s unequivocal opinion that in an ideal world all companies, irrespective of their size or sector, would be constantly looking to upskill their existing workforce through apprenticeships, in addition to using the programme to bring in new talent to train up.”

Holt was commissioned by the government departments of business and education in February to review ways of making apprenticeships simpler and more accessible for SMEs.

Manufacturers’ association EEF welcomed the report and the government plans, saying progress in the area had been too slow to date.

“Relaxing the requirements [of the Apprenticeship Grant for Employers] in the way the government has outlined will allow businesses to take on more apprentices and offer these invaluable opportunities to young people,” said Tim Thomas, head of employment and skills at EEF.

But Thomas added that issues such as careers advice, the status of vocational education and “regulatory burdens” also needed addressing to encourage a greater uptake of apprenticeship programmes.