Training rules OK

The government is to relax its rules on training funding in a bid to give smaller businesses help with skills development in the face of a slowing economy.

The move forms part of a package, claimed to be worth £350m, unveiled by the

(DIUS) in response to what it described as 'the tougher economic climate'.

Under the relaxed regime, companies will be allowed to be funded for small units or individual modules in areas identified as priority areas for SMEs. These include business improvement techniques, new product design and commercially-focused areas such as risk management and financial management.

The rules will be eased to allow workers to access training up to level Two, even if they already have a previous qualification up to that grade, and more funding will be provided for level Three training. This removes the requirement on training providers to ensure that a proportion of programmes are delivered to employees entering the training system for the first time.

The DIUS leadership and management programme will be opened up to companies with as few as five staff, while advisers will offer to audit and assess SMEs to point them towards the right training providers.

The funding to support the training package will be drawn from the government's Train to Gain scheme, which will be told to give priority to SMEs over the next two years.

Only privately-owned firms with up to 250 employees will be eligible for the extra support, which must come via accredited training providers. Statutory training in areas such as health and safety will not be eligible for public funding.

The DIUS announcement comes against a background of growing economic pressure on the engineering and manufacturing sector. According to the CBI, manufacturing has just seen its biggest fall in confidence for almost 30 years, with almost half of firms seeing a drop in orders during the last quarter.

Skills secretary John Denham claimed the extra provision would give smaller companies a better chance of weathering the storm. 'We know that firms which invest in skills do better than those that don't,' he said.

The government's programme of support for companies in the engineering and manufacturing sectors scored poorly in a recent major survey carried out by

in association with YouGov.

Skills provision was also identified as being in need of a shake-up by a recent study backed by the government. Its new strategic plan for the manufacturing sector admitted that employers often find it difficult to access the support available, and recommended streamlining the system in an attempt to give it a single focus.