Flexible AI Upskilling Fund pilot

The Flexible AI Upskilling Fund pilot scheme will support SMEs in the Professional and Business Services Sector by match-funding AI skills training for their employees. Please note, Cabinet Office Government Grants Managed Service will be the Delivery Partner for scheme administration.

  • Opening date: (Midday)
  • Closing date: (Midnight)

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Contents

Summary

The Department for Science, Innovation and Technology (DSIT) recently announced a £7.4 million pilot scheme to subsidise the cost of AI skills training for small and medium-sized enterprises (SMEs) in the Professional Business Services sector. £6.4 million of grant funding is available.

Through this pilot programme, eligible businesses can apply for funding for up to 50% of the cost of AI skills training and other AI upskilling activities. This refers to training which supports employees to develop their technical skills and/or understanding of AI to be able to develop, deploy, or use AI in their role.

This pilot scheme is funded through the £37.5 million Labour Market Evaluations and Pilots fund, announced by the Chancellor at Spring Budget 2023.

Funding will be provided by DSIT in the financial year (FY) of April 2024 to March 2025. Successful applicants must be able to complete delivery of training and submit invoices for reimbursement via grant funding by February 2025.

Please note that by submitting this application for grant funding for the AI Upskilling Fund, you agree to be contacted by DSIT and its delivery partners for future surveying to contribute to the evaluation of the pilot. If you are unsuccessful in your application and would like to opt out, please email us at ggms_aiupskilling@cabinetoffice.gov.uk 

Please note that this scheme is a pilot funded by the Labour Market Evaluations and Pilots Fund (LMEP). This fund aims to build the evidence base on the effectiveness of policies to improve labour market outcomes, including by funding novel or experimental approaches such as this one. To ensure this pilot generates robust evidence of the effectiveness of this type of skills intervention, this scheme may be evaluated based on a Randomised Controlled Trial (RCT) approach. In this scenario, funding will be awarded by lottery amongst applications which score above a pre-defined merit threshold. If this scheme does not adopt an RCT approach, funding will be awarded via merit-based allocation for the funding available. If you are unsuccessful in your application, we will inform you whether it was because we have adopted an RCT approach or because you did not reach the minimum merit threshold, outlined further below.

Applicants can apply for a maximum amount of funding depending on the size of their business, set out in the table below. The aim of the scheme is to subsidize the cost of AI skills training up to a ratio of 1:1. For example, a small-sized business can apply for up to £5,000 of grant funding to pay for 50% of AI skills training which costs £10,000. If the training cost £8,000, the applicant could only apply for £4,000 of grant funding.

To ensure a robust evaluation, our aim is to fund a range of businesses across the micro, small and medium-sized business categories, so we may limit the total number of businesses that can be awarded funding in each size category. The maximum amount of funding available per individual applicant will remain as stated above. If, over the course of the pilot, there are not sufficient businesses applying in one or another category, we will look to reallocate funding to the other categories.

Funding is for the delivery of AI skills training only. It is not for the cost of:

-          Purchase of AI technologies

-          Business advice of consulting

-          Recruitment activity

-          Work placement or internship salaries

-          Capital expenditure (1)

Applicants can apply for different levels of funding depending on their business size and type as defined by BEIS SME action plan: 2022 to 2025 (2).

Minimum Financial Assistance

This grant funding is awarded under Minimum Financial Assistance exceptions to the UK Subsidy Control regime. 

The Department for Science, Innovation and Technology offers a Minimum Financial Assistance (MFA) subsidy under the Subsidy Control Act (2022), subject to your agreement to, and compliance with, the terms and conditions set out below.The amount of MFA offered is up to £10,000. Before making the payment, we require written confirmation that receipt of the payment will not exceed each business’ MFA threshold of £315,000 cumulated over this and the previous two financial years, as specified in section 36(1) of the Subsidy Control Act (2022). This means you must confirm that you* have not received more than £315,000 minus the value of this subsidy in MFA subsidies or comparable types of subsidies (see section 42(8) of the Subsidy Control Act) between 1 April 2022 and this date. 

We take this opportunity to remind all potential applicants that you are required to keep a written record of the amount of MFA you have received and the date/s when it was received. The written record must be kept for at least three years beginning with the date on which the MFA was given. This will enable you to respond to future requests from public authorities on how much MFA you have received and whether you have reached the cumulative threshold. Subsidy Control Statutory Guidance 97 Confirmation must be sent by someone who is authorised to do so on behalf of your organisation.

Randomised Controlled Trial (RCT)

Please note that this scheme is a pilot funded by the Labour Market Evaluations and Pilots Fund (LMEP), which aims to continue to build the evidence base on the effectiveness of policies to improve labour market outcomes, including by funding novel or experimental evaluations. As such, this scheme may adopt a Randomised Controlled Trial (RCT).  

In this scenario, funding will be awarded by lottery amongst applications above the pre-defined merit threshold. If this scheme does not adopt an RCT approach, funding will be awarded via merit-based allocation for the funding available.

If applicants are unsuccessful, they will be notified whether it was because they did not pass the eligibility or merit threshold, or because they were randomly selected through the RCT to not receive funding. All businesses will be expected to engage with the evaluator throughout the pilot and evaluation up to March 2027.

(1) Capital expenditure means money used to acquire, adapt or maintain fixed assets, such as land, buildings and equipment, which is normally capitalised in the provider’s audited annual accounts.

(2) https://www.gov.uk/government/publications/beis-small-and-medium-enterprises-sme-action-plan-2022-to-2025/beis-small-and-medium-enterprises-smes-action-plan-2022-to-2025-accessible-webpage

Eligibility

Business Eligibility:

Please note that we will not accept bids from consortiums. Each bid must be submitted by an individual business.

To be eligible to bid, a business must:

·         Be registered and operate in the UK

·         Employ between 1-249 employees in the UK

·         Be defined per BEIS SME action plan: 2022 to 2025 (1)

·         Have been operating for at least 1 year at the time of application

·         Operate in the Professional and Business Services (PBS) sector (2)

Eligible Activities: What can funding be spent on?

Through this pilot programme, eligible businesses can apply for funding for up to 50% of the cost of AI skills training and other AI upskilling activities. This refers to training which supports employees to develop their technical skills and/or understanding of AI to be able to develop, deploy, or use AI in their role. 

Unsure about how to understand your AI upskilling needs, or need help identifying the type of training your employees would benefit from?

DSIT, in collaboration with InnovateUK and the Alan Turing Institute, has published cross-sectoral guidance outlining the relevant skills and competencies employees need to use AI in a business setting. Please visit the Turing website where you can find the guidance and other useful support for identifying your AI skills needs. (3)

Funding awarded through this scheme can only be spent on eligible activities. A wide range of training, courses and certification is eligible for the funding:

·         Off-the-shelf training courses

·         Classroom learning

·         On-line or distance learning

·         Certification or accreditation programs

·         Development of bespoke training or learning resources for the individual company by a third party, provided those resources are not already available in the market. However, development of training materials for external companies is not permitted. For example, you are not able to use this funding to develop and/or deliver training to businesses other than the business named on this application form. Development of training materials in-house is also not permitted.

To be eligible, the activity must meet all the following:

1. Is related to core AI skills sets and support the adoption of AI in the workplace. These will include Machine Learning, Natural Language Programming, Data Science, etc.

2. Starts no earlier than the date that the Grant Funding Agreement is signed by both parties (expected July 2024) and end no later than 31 March 2025. We are unable to fund training that extends beyond 31 March 2025 or retrospective activity.

3. Is delivered by an eligible training provider. This is a provider that is (i) registered in the UK, (ii) is at least one years old, and (iii) meets any one of the following criteria: (iiia) is registered on the UK Register of Learning Providers or (iiib) is accredited by one of the accrediting/awarding organisations.

4. Is not already subsidised by government for employers. (e.g., Skills Bootcamps are not eligible) 

5. Is not delivered by your own company to your own employees. For example, training delivered in-house is not eligible. 

(1) https://www.gov.uk/government/publications/beis-small-and-medium-enterprises-sme-action-plan-2022-to-2025/beis-small-and-medium-enterprises-smes-action-plan-2022-to-2025-accessible-webpage

(2) https://www.gov.uk/government/publications/flexible-ai-upskilling-fund

(3) https://www.turing.ac.uk/skills/collaborate/ai-skills-business-framework

Objectives

Evidence shows that a lack of AI skills in businesses is hindering AI adoption, in part due to low investment in AI upskilling by UK businesses. This is particularly true in smaller companies. The Flexible AI Upskilling Fund pilot scheme aims to increase AI adoption and productivity by incentivising greater employer-led investment in skills and training. 

Specifically, the pilot has the following objectives:

  • To address AI skills gaps in the UK workforce limiting AI adoption

  • To stimulate employer investment in AI training

  • To measure the impact of AI upskilling on business productivity and outcomes

Dates

Please note that the below timeframes may be subject to change.

  • Funding competition launches for businesses to submit bids: 1 May 2024

  • Application window closes: 18 August 2024

  • Bids Assessed: August - September 2024

  • Award letters issued: September 2024

  • Procurement and delivery of training: September 2024

  • Businesses submit requests for payment following training delivery: October 2024 to February 2025

  • Cut off for training delivery and requests for payment: February 2025

  • Deadline for training devliery and grant funding reimbursement/ All reimbursement delivered: 31 March 2025

How to apply

Eligible businesses are invited to submit an application by selecting Start new application.  

Please note that we will not accept applications from consortiums. Each application must be submitted by an applicant representing an individual business.

We will only accept one application per business.

There are 6 sections to this application:

Eligibility Statement:

You will be required to agree to the eligibility criteria in order to proceed further details can be found under the ‘Eligibility’ section. Failure to agree will prevent you from proceeding with your application.

If you have read the guidance beforehand, this will take less than 30 seconds to complete.

Due-diligence checks:

All applicants are asked for certain information which allows us to carry out compliance and due-diligence checks, and prevent fraud.

The information required depends on the type of organisation you are, however the information is standard and should be quick to populate:

●    Organisation legal name

●    Organisation type (e.g. limited company)

●    Registered address

●    Charity Commission number (if applicable)

●    Companies House number (if applicable)

●    Amount of funding required

●    Where the funding will be spent

We do not anticipate this section taking longer than 2 minutes to populate.

General Details:

You will be required to provide a contact profile for a nominated Lead Contact to handle all grant correspondence: This includes, full name, job title, e-mail address and telephone number.

To understand the effectiveness of our market engagement, we also ask you to select how you heard of the AI Upskilling Fund. We are hopeful that you will engage here to enable this policy to succeed.

You will also be required to verify that receipt of this grant will not exceed the Minimum Financial Assistance (MFA) threshold of £315,000 cumulated over this and the previous two financial years.

The details in this section should all be easy to access as you would be required to hold a register of your MFA arrangements (where applicable). As such this section should only take you 5 minutes.

Business Eligibility:

Here you should be prepared to confirm your total employee number, your latest published turnover figure (GBP), your latest published balance sheet total (GBP), which of the eligible SIC codes apply to your business, and the date of incorporation of your organisation to ensure your business is at least one year old at the time of application.

Please note that for the purposes of this scheme, your balance sheet total should be your GROSS ASSETS figure, not net assets.

This information should be readily available, and so completion of this section should not take more than 10 minutes.

Training Eligibility

We encourage you to research your training requirements in detail and in reference to our training eligibility requirements.

The decision of what training you procure rests with you and DSIT will not influence your decision. However, our guidance documents lay out a series of accrediting bodies to reference while seeking out eligible training providers.

Remember that the funding you request should be the lower of either 50% of the cost of training, or the maximum funding amount for your SME size.

To verify your training provider, we will require either the UKPRN number of the provider, or name and accreditation number of the awarding organisation. This should be readily available on the training provider's webpage.

In addition, the name of the training provider, their course and supporting links are required to support your bid for this grant funding. Please ensure you have these to hand prior to starting your application.

We will also request that you provide some supporting information on:

●     The AI skills covered by the training

●     What qualification level the training is

●     The nature of the training

●     The length of the training

●     The purpose of the training

●     The skill level, job role and number of your employee(s) who will undertake training

This supporting information will form the basis of the pilot evaluation that you agree to partake in as part of the Grant Funding Agreement.

This section is the most detailed or questions and we recommend you spend anywhere between 30 minutes to two hours considering your training needs in detail before applying.

Proposal Outline

To end, we want to hear a candid answer from all applicants in regards to your AI training needs, and how you intend to utilise the training provided to overcome the complex AI challenges faced in your industry.

Your answers here will be reviewed in isolation and graded on their own merit, your answers will not be graded in comparison to other applicants.

Question 1 asks you to provide an overview of your organisation’s AI adoption, AI skill levels and any challenges faced in upskilling employees in AI and/or implementing AI. You have 250 words to complete this question.

To aid your answer, you can explain:

●     What your organisation is and does

●     The level of knowledge of AI in your employees and business overall

●     Existing technology adoption and AI adoption within your business, if any

●     The barriers, if any, that you currently face on upskilling employees in AI

●     Any training on AI or other relevant training that has already been delivered to employees within the business

Question 2 asks you to explain how the training funded through this scheme will help mitigate the challenges you set out in your first answer, and what benefits and outcomes you expect to see within your business following the upskilling. You have 350 words to complete this question.

To aid your answer, you can explain:

●     What AI skills your employee(s) will have after completing the training that they did not have before

●     How the AI skills training will enable your business to adopt AI

●     Which business areas or functions will the AI training support

●     What does success look like in terms of completing and using the skills learnt from the training and how will you measure this

While we expect that most applicants will spend the most time on these questions, your ability to articulate your business needs and how you will utilise the training provision will enable you to gain a higher score. A shorter but concise answer may score higher than a long but vague answer.

As a standard, you could expect to spend up to 30 minutes on this section.

Need further guidance?

If you are unsure at any point during your application our team is available via email at ggms_aiupskilling@cabinetoffice.gov.uk we aim to reply to all emails within 2-3 working days.

Supporting information

You can find further information about the scheme objectives, elgibility requirments and supporting documents through the gov.uk page here.

Draft Grant Funding Agreement

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Draft FAIUF Grant Funding Agreement.docx (338 Kb)

FAQs - Webinar for the Flexible AI Upskilling Fund Pilot

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FAQs - Webinar for the Flexible AI Upskilling Fund Pilot 01.05.docx (3010 Kb)