Published 17th August 2020
The Government announced in July 2020 they will be introducing a new Kickstart Scheme in the UK. This scheme will have a £2 billion fund to create hundreds of thousands of six-month work placements aimed at those aged 16-24 who are on Universal Credit and are deemed to be at risk of long-term unemployment. The funding available for each job will cover 100% of the relevant National Minimum Wage for 25 hours a week, plus the associated employer National Insurance contributions and employer minimum automatic enrolment contributions.
The aim of the scheme is the creation of high-quality jobs for young people at the highest risk of long-term unemployment amongst fears of high unemployment rates as a result of the coronavirus.
What is the Kickstart Scheme?
The Government aims to create six-month work placements for young people aged between 16 and 24 and at risk of long term unemployment.
Through the Kickstart scheme, the Government will pay employers the minimum wage, National Insurance contributions and pension contributions of each placement they take on (based on a 25-week placement) for a period of 6 months.
Which employers can apply for the Kickstart Scheme?
The Government is encouraging all businesses to apply as, to date (6 August 2020), they have yet to publish criteria excluding any employers from the scheme. Furthermore, Rishi Sunak promised that there will be no cap on the number of placements a business can take on under the scheme.
How do employers apply for the Kickstart Scheme?
Currently, the government has not published anything on how employers can apply for the scheme but during his speech, Rishi Sunak said employers would be able to apply within the next couple of months so hopefully guidance will be published shortly.
Does the employer have to employ anyone taken on under the scheme after the 6 months?
Based on the guidance currently available, it appears there will be no requirement for employers to keep anyone who is employed under the scheme after the six-month placement has finished.
Who will the Government pay?
The Government will pay the employer directly.
Are all 16 to 24-year-olds on Universal Credit eligible?
Currently, with the guidance that is available, it is not clear what the Chancellor means by 16 to 24-year-olds on Universal Credit “at risk of long term unemployment”. It is unclear whether this will mean all 16 to 24-year-olds on Universal Credit will automatically be eligible or whether criteria will be put in place.
If you’d like to receive any further information on this Scheme, we intend to share the updates as soon as we receive any information. We can add you to our updates if you email us at email@example.com.