Britain looks to private firms to boost youth training

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LONDON, Aug 21 (Reuters) - Britain plans to tell firms that win large public contracts to commit to taking on more young workers to boost the country's skill levels, stepping up the pressure on private companies to increase youth training schemes.

Britain, which is battling poor productivity levels, had a youth unemployment rate of 16 percent in August compared with an overall level of 5.6 percent.

In proposals announced on Friday, companies wishing to bid for government contracts worth more than 10 million pounds ($15.68 million) must demonstrate a clear commitment to apprenticeships by placing a "reasonable proportion" of people in a formal training programme. It (Other OTC: ITGL - news) did not give further details.

It had previously set the level at 50 million pounds.

"Skilled people are the lifeblood of a strong economy but for too long UK businesses have invested too little in developing their employees," Britain's Skills Minister Nick Boles said in a statement.

The government also reaffirmed plans on Friday to introduce an apprenticeship levy to ensure employers invest in skills training and apprenticeships.

Under the levy plan, which is set to be introduced in 2017, large companies will put money into a fund which firms can then draw from to support their training schemes.

The plans form part of the government's pledge to support up to 3 million apprenticeships by 2020.

Britain spends more than 50 billion pounds a year on outsourcing services like back office IT systems, cleaning and construction to companies like Capita (LSE: CPI.L - news) , Mitie and Carillion (Other OTC: CIOIF - news) . ($1 = 0.6379 pounds) (Reporting by Li-mei Hoang; editing by Susan Thomas)