Business leaders have hit out at plans to axe a vital training fund - even as new figures show the benefits of investing in apprentices.
Business secretary Vince Cable boasted that the Government has fulfilled its commitment to starting two million apprenticeships since the last election.
And in the North East, there have been 143,800 apprenticeship starts since May 2010.
But now, despite the region making up 7.2% of the country’s overall apprentice intake, businesses have criticised the Government’s proposal to divert money away from training providers and give businesses direct control of the funding of their own apprenticeships.
They warned it could lead to a dip in the number of firms offering schemes - especially among especially small and medium enterprises - taking the region right back to square one.
North East Chamber of Commerce director of policy, Ross Smith, said: “We need a funding system that makes it easier for more businesses to hire apprentices.
“What’s being proposed instead is a course of bureaucratic obstacles for smaller businesses.
“Instead of paying the training providers, the Government has proposed to give businesses control of apprenticeships.
“In theory this makes sense but in practice very few SMEs will be well enough equipped to take on apprentices and run their own programmes without the support of training providers.
“The system is far from perfect at the moment, but a lot of our members feel the reforms being proposed are actually going to discourage investment in apprenticeships from businesses, especially SMEs.
“We have got major skills challenges and good businesses are making the investments required to train the workforce of the future and we need more to do the same.”
Hexham MP Guy Opperman, who is the first MP in the country to hire, train and retain an apprentice, urged businesses across the region to consider taking on an apprentice.
The Conservative MP said: “There are specific examples where we can see locally the huge differences being made by hiring apprentices.
“At Egger, in Hexham, there are in excess of 40 apprentices who are working their way through their programme.
“Unemployment is down in every single constituency throughout the North East, including places with typically high unemployment levels.
“It is important that employers, big and small, walk the walk as well as talk the talk.”
Business secretary Vince Cable said reaching the two millionth apprenticeship paid testament to the Coalition’s commitment to apprenticeships.
“This isn’t just about numbers,” he said. “From space engineering, to TV production, to legal services, apprenticeships are the ticket to a great job and a route employers trust to access the skills they need.”
Skills minister Nick Boles added: “Apprenticeships have a vital role to play in supporting the long term economic plan.
“Two million is just the start - I want to see more employers making apprentices a key part of their strategies for growth.”