THE £49 million skills deal awarded to the West Midlands is just part of a potential £200 million “war chest” to tackle the skills shortage, it has been claimed.

Education Secretary Damian Hinds visited Dudley College yesterday (Wednesday) to announce that the West Midlands had won the first ever government ‘skills deal’, aimed at training workers to fill a range of skilled jobs.

This is in addition to the £20 million the West Midlands Combined Authority has already committed to tackling the region’s skills shortage.

But Mayor Andy Street says that this £69 million is just the start of funding to tackle the problem, with £200 million potentially available to the region over the next year.

“So we’ve got that headline money, but if you look at the total money on offer here it could easily reach £100 million soon.

“£49 million is basically new cash from government, and about £40 million is there if businesses choose to use the flexibility around the [apprenticeship] levy.”

The apprenticeship levy scheme is intended to fund new apprenticeships, using a levy of 0.5 per cent on the wage bill of employers with salary costs of more than £3 million per year. This money can then be dipped back into for apprenticeship training.

Across the country as a whole the levy raises around £3 billion a year, though millions go unclaimed.

And the combined authority is asking businesses to sign an agreement ensuring that 10 per cent of anything raised goes specifically to West Midlands businesses.

“This is a very important part of it, because we want this for West Midlands businesses in a way that other regions do not have it,” the mayor said.

“So we’re talking about putting the underspend on the levy into a West Midlands specific pool.

“Frankly how much money goes into that depends on how many businesses decide to do it.

“On top of that there’s £20 million that the combined authority have already allocated to skills.

“And of course the adult education budget as well, which comes under the combined authority’s control next year and is over £100 million.

“So what I hope comes out of this is that we’re building something of a war chest to be able to address this total skills issue.”

The skills shortage is often cited as one of the top concerns for a number of employers across the region, while youth unemployment has been a constant blot on the mayor’s record in his first year.

But he hopes that this new influx of cash will help solve both of these problems for the West Midlands.

“The new cash that I hope will come from this new West Midlands pool, from the levy, is it will create more apprentices, and progression coaches who are designed to reach and help those hard to reach people.

“So it’s more resource and effort into that problem.

“One of the papers we’re looking at in the combined authority’s board meeting on Friday is ‘The state of the region’.

“And so much of it is positive, but youth unemployment is one of the things that’s not, and we want to change that.”