The AI Upskilling Fund

Spring Budget 2024 announced the £7.4 million AI Upskilling Fund for small and medium-sized enterprise (SMEs). Where a company meets the definition of being eligible, the UK Government announcement aims to increase the adoption of artificial intelligence (AI) by stimulating employer investment in training, thereby addressing skills gaps.

On 01 May 2024, the promised pilot was launched for applications by the Department for Science, Innovation and Technology (DSIT), renamed the Flexible AI Upskilling Fund and announcing eligibility conditions:

• Registration and operation in the UK
• Be in existence for at least one year and operating for at least one year when an application to the Fund is made
• Employing between 1-249 employees in the UK, meeting the SME criteria (see below)
• Operating in the ‘Professional and Business Services sector’ as defined by a rigid list of  ‘Standard industrial classification of economic activities’ codes – the SIC code (see below)

The Fund will allow SMEs to claim up to 50% of the cost of employees’ AI upskilling in the form of a grant and members are encouraged to look at the eligibility criteria and take advantage of this Fund which is open for applications.  This is for the academic year April 2024 to March 2025.  Where the eligible employer can submit delivery of training invoices, the grant will be paid by February 2025.

For Bookkeepers

So much of what we do is about eligibility and members need to refer to this prior to making an application.  There are two key factors:

The SME

It is important to understand this definition in the first instance, as the Fund is open to micro employers as well:

The size of the SME is important as the grant is on a 50% employer and 50% UK Government sharing basis plus there are caps:

• Micro – capped at £2,500 per business applicant
• Small – capped at £5,000 per business applicant
• Medium – capped at £10,000 per business applicant

The SIC Code

The £7.4 million AI Fund is only available to SME businesses in the Professional and Business Services sector with a SIC code that falls under ‘Section M’ of the Companies House list.  So, the profession of the business must include a SIC code that starts:

The Fund is also available for rental and leasing professions, for example, businesses that rent out cars, machinery and equipment.

Bookkeepers, accountants, auditors and payroll professionals will come under division 69, so this Fund may be available to members. 

ICB recommends SMEs consider AI upskilling and the grants that are available for training costs.  Elements such as salaries, the cost of AI technologies and capital expenditure are excluded from the Fund.