The National Internship Scheme has been invaluable for smaller firms. So why is it ending?

Internship scheme set to end next month

Larger companies don’t have to search very far for their interns. Attracted by the prospect of recognisable names on their CVs, the brightest and the best apply either speculatively or to advertised positions in their droves. Not so for the majority of Britain’s businesses – the small and medium-sized firms that need the talent the most.

It’s caused some consternation then, that the National Graduate Scheme, a government-funded initiative to allow smaller firms access to graduate talent, is expected to end this month.

The scheme worked by putting businesses in need of graduate talent in touch with universities, which took on an extra person in their careers service in order to source the right people for the (government subsidised) internships. Jim Watson is founder of Appleby Parva and found two interns through the scheme to design the start-up’s website.The graduates who worked with the company didn’t have the experience they needed to secure full-time employment and so jumped at the opportunity to develop their portfolio.

Watson is a big proponent of the scheme, saying:  “As a small business, it gave us access to skilled practitioners we otherwise could not afford.” He adds that the wage for the graduates went directly to them from the university, making it more convenient for the business.

The Federation of Small Businesses is now calling for the continuation of the “highly successful” scheme. It creates a convincing argument, figuring out that it would cost £8m in government investment, and that the amount would be more than replaced by the money saved on benefits and Job Seekers Allowance plus the taxes paid if 25% of the interns were made permanent members of staff. Of course, the assumption that a quarter of all interns get a job  is an unscientific estimate at best, but the gist is that the investment would be a negligible one, and that’s difficult to argue with.

Watson says now that his firm will struggle to continue using interns. Certainly for start-up firms, to invest in sourcing and then paying even minimum wage for skilled interns can be a huge outlay.

It was the previous government that started the scheme, and for the Coalition to continue the scheme would seem to meet the needs of both unemployed graduates and cash-strapped smaller firms. Will they consider it?

The Department of Business, Innovation and Skills had only this to say to GB:”A number of subsidised internship schemes were established, which between them will have delivered over 10,000 subsidised graduate internship opportunities by 31 March 2011. Funding was provided for a set number of internship places on a one-off basis. A final decision has not yet been made on whether we are able to repeat this.”


(will not be published)