Chancellor Rachel Reeves has now delivered the long-anticipated 2025 Budget, outlining changes in taxation and funding that will affect the electrotechnical sector and the wider construction industry
NICEIC Media Team | Communications
Apprenticeships and skills
Training costs for apprentices under 25 will be fully funded for SMEs from 2026, increasing Government co-investment and removing the 5% contribution currently paid by employers.
This is part of a wider commitment of £820 million over the next three years under the Youth Guarantee. As we learnt the day before the budget, the minimum wage for apprentices will rise by 6% to £8.00 which will add cost pressure for employers and potentially impact hiring decisions.
Research from JTL shows the sector needs 10,500 apprenticeship starts annually to stabilise the country’s electrical workforce, replace those leaving the industry, and close the skills gap. This can only be delivered by continued investment in skills and government backing electrical contractors train the next generation.
Electric vehicles
Major changes were announced impacting the EV market. First, the introduction of a pay-per-mile system, with charges of 3p per mile for EVS and 1.5p for plug-in hybrids.
Second, the Electric Car Grant (ECG) has been extended, providing additional support for new EV purchases. The ECG currently provides up £3,750 off the price of an EV under £42,000, rising to £50,000 from April 2026. The Chancellor also pledged to accelerate the rollout of public EV charging infrastructure.
Changes in market incentives notwithstanding, 2024 was another record year for new EV registrations and the market is showing signs of continued growth this year, with total sales surpassing the 2024 figure by the end of October. With the 2030 ban on new petrol and diesel car sales on the horizon, the number of EVS on Britain’s roads will continue to grow in the medium term.
Energy efficiency
The Energy Company Obligation (ECO) scheme will be phased out by 31 March 2026. From April next year, households will see an average £150 reduction in energy bills as ECO costs are removed. To offset this, the government announced an additional £1.5 billion capital investment for the Warm Homes Plan, alongside the £13.2 billion already allocated at the 2025 Spending Review, creating potential opportunities for contractors involved in retrofit and renewables, although we are awaiting publication of the details of the plan.
What this means for contractors
Paul Collins, Technical Director, NICEIC, commented: "The sector has faced economic headwinds, from a period of high inflation, recruitment difficulties, and delayed investment decisions. Certainty is now critical for planning and growth. The publication of the Warm Homes Plan could provide this stability for contractors, but details remain unclear. We would encourage the government to prioritise publication as quickly as possible, to give businesses the clarity they need on how this funding will be deployed."
Training costs for apprentices under 25 will be fully funded for SMEs from 2026, increasing Government co-investment and removing the 5% contribution currently paid by employers.
This is part of a wider commitment of £820 million over the next three years under the Youth Guarantee. As we learnt the day before the budget, the minimum wage for apprentices will rise by 6% to £8.00 which will add cost pressure for employers and potentially impact hiring decisions.
Research from JTL shows the sector needs 10,500 apprenticeship starts annually to stabilise the country’s electrical workforce, replace those leaving the industry, and close the skills gap. This can only be delivered by continued investment in skills and government backing electrical contractors train the next generation.
Electric vehicles
Major changes were announced impacting the EV market. First, the introduction of a pay-per-mile system, with charges of 3p per mile for EVS and 1.5p for plug-in hybrids.
Second, the Electric Car Grant (ECG) has been extended, providing additional support for new EV purchases. The ECG currently provides up £3,750 off the price of an EV under £42,000, rising to £50,000 from April 2026. The Chancellor also pledged to accelerate the rollout of public EV charging infrastructure.
Changes in market incentives notwithstanding, 2024 was another record year for new EV registrations and the market is showing signs of continued growth this year, with total sales surpassing the 2024 figure by the end of October. With the 2030 ban on new petrol and diesel car sales on the horizon, the number of EVS on Britain’s roads will continue to grow in the medium term.
Energy efficiency
The Energy Company Obligation (ECO) scheme will be phased out by 31 March 2026. From April next year, households will see an average £150 reduction in energy bills as ECO costs are removed. To offset this, the government announced an additional £1.5 billion capital investment for the Warm Homes Plan, alongside the £13.2 billion already allocated at the 2025 Spending Review, creating potential opportunities for contractors involved in retrofit and renewables, although we are awaiting publication of the details of the plan.
What this means for contractors
Paul Collins, Technical Director, NICEIC, commented: "The sector has faced economic headwinds, from a period of high inflation, recruitment difficulties, and delayed investment decisions. Certainty is now critical for planning and growth. The publication of the Warm Homes Plan could provide this stability for contractors, but details remain unclear. We would encourage the government to prioritise publication as quickly as possible, to give businesses the clarity they need on how this funding will be deployed."
