Chancellor Philip Hammond to announce £125m of new investment in apprenticeships and skilled jobs

Chancellor to defend British business following series of attacks from Tory Brexiteers

Philip Hammond will announce plans to plough £125m of new funding into jobs and apprenticeships when he addresses party members at the Conservatives' annual conference later today.

The chancellor will tell the gathering in Birmingham that too many people feel they are "falling behind" after years of low wage growth.

The fresh investment will be used to create more apprenticeships in the sciences, technology, engineering and mathematics - known collectively as STEM subjects.

The government will also allow large companies to transfer funding for apprenticeships to smaller firms in a bid to create more high-quality training places.

Speaking from the conference podium, Mr Hammond will defend British business after a series of attacks from Tory MPs over Brexit.

Boris Johnson, then the foreign secretary, is reported to have exclaimed "f*** business" at an event in June, while Jeremy Hunt, the current foreign secretary, has said it is "completely inappropriate" for industry leaders to be issuing stark warnings about Brexit.

On Saturday, Steve Baker, the former Brexit minister, called the Confederation of British Industry (CBI) a "grave menace".

In response, Mr Hammond will tell the Tory faithful that business is "the cornerstone of a successful economy".

He will say: "Economic freedom goes hand in hand with political freedom and above all, the belief in the power of enterprise as the route to unleash talent and to improve lives.

“That’s why we back business, as the cornerstone of a successful economy, as a force for good in our society, and as an essential expression of our values.”

The Chancellor will announce plans to allow large employers to transfer up to 25 per cent of the money they have to set aside for apprenticeships to other businesses in their supply chain.

At the same time, new funding will be spent on improving the number of courses and apprenticeships in STEM subjects, as well as the transport and healthcare industries.

A further £30m will be set aside to establish mentoring partnerships between big businesses and smaller companies. More than 137 mentors from companies such as Amazon, KPMG, GlaxoSmithKline and Siemens have already agreed to take part.

Mr Hammond will say: “Ten years on from the financial crisis, Conservative leadership has delivered Britain a stronger, more resilient economy. We have delivered 22 consecutive quarters of economic growth since 2010, creating over 3 million more jobs and taking unemployment to a 43-year low."

But he will add: "Too many people have experienced years of slow wage growth, felt less secure in their jobs and seen the housing market spiral beyond their reach. And as they look around them, they feel a growing concern that they are falling behind.

“So the challenge is to ensure that 21^st Century capitalism delivers for them; to convince them that our vision of Britain’s future can meet their aspirations and that our plan, unlike Labour’s, will actually deliver a better tomorrow for them and their families.”

Mr Hammond will establish a "Small Business Leadership Programme" to provide training in management to an initial 2,000 small businesses, rising to 10,000 if there is sufficient demand.

And the Treasury will review the future of the Apprenticeship Levy to ensure it is creating training opportunities in areas where they are most needed.

Business groups welcomed Mr Hammond's speech.

Stephen Martin, director general of the Institute of Directors, said: "The Chancellor looks to be kicking off the conference with a business friendly tone and we hope this will continue throughout the week.

"It is no secret that at times business leaders have felt neglected over the past few months and we hope these announcements will mark a change in direction by recognising the contribution they make to our economy.

He added: "IoD members have long called for change to the levy system and the introduction of greater flexibility over the use of funds will be celebrated, as will the promise of further engagement.

"The levy must be responsive to the needs of businesses across the country, and the increase in STEM apprenticeships couldn't come a moment too soon."