Abolition of employer national insurance contributions for apprentices under the age of 21 and 25 respectively (Reduction of secondary Class 1 NICs for apprentices)

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National Insurance Contributions Act 2014 (with regard to apprentices under the age of 21) and National Insurance Contributions Act 2015 (with regard to apprentices under the age of 25)

To make it cheaper for employers to take on apprentices (HM Treasury, 2014)

HM Revenue & Customs (HMRC) is responsible for the overall management, monitoring/evaluation of the instrument and day-to-day operation.

Companies employing apprentices aged 16-25.

The instrument supports only apprenticeship.

State (loss of tax revenue)

EUR 6,091 is the maximum amount of employer national insurance savings, corresponding to an apprentice pay of EUR 54,000.
However, in general, apprenticeship pay is far lower. In 2016, average pay per year for apprenticeship levels 2 and 3 was reported to be EUR 16,357. This would correspond to a EUR 1,097 employer national insurance savings for this year (6,7%).

Employer's national insurance contributions payable on the apprentice's wage.

In tax year 2016/17 (running from 6 April 2016 to 5 April 2017), the annual cost to this instrument from public sources (i.e. the loss of public tax revenue) was EUR 120,000,000.

No data on the number of companies that took the advantage of the tax relief is available.
In 2016, approx. 180,000 employers offered apprenticeships in the UK, across all apprenticeship levels. Employers whose apprentices are all 25 and older are not able to benefit from the tax relief.

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National insurance relief was initially introduced in 2015 for employers employing apprentices under the age of 21 and was then extended to those employing apprentices under the age of 25 in 2016.

HM Revenue & Customs (HMRC),
https://www.gov.uk/government/organisations/hm-revenue-customs

McGuinness. F. and Apostolova, A- (2016) Apprenticeships Funding.
Debate Pack. Number CDP 2016/0192, 31 October 2016