“Adopt an Intern, Scotland’s unique service for businesses and graduates, plans to double its paid internships to 500 this year with a push into England.

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The six-year-old social enterprise has seen its core funding from the Scottish Government cut by more than 50 per cent, but has moved to a fee-charging model which it says will underpin sustainable growth.

Founder and chief executive Joy Lewis said: “This year is going to take us into the rest of the UK, and we now have a marketing person (entrepreneur Ian Lebruce).

“There are internship programmes in England but none of them seem to be social enterprises, so I do think there is a market down there. We are talking to businesses and we now have an offering – come to us and we will find you a graduate at a very affordable rate.”

The organisation emerged in 2010 as a response by the Centre for Scottish Public Policy to the plight of unemployed or unpaid graduates. Ms Lewis advanced the cause with employers willing and able to pay for the right interns, and looked for grant funding to ensure that hard-up smaller businesses and charities were not excluded.

AAI works with organisations to identify graduate-level opportunities linked to specific work projects, then manages recruitment and short-listing to find the right candidate.

It has so far created paid internships for over 1100 young people, 77 per cent of whom went straight into permanent work. The remainder went into another internship or into further education. Each opportunity is advertised and attracts an average 39 graduates.

Government support enabled AAI to fund the wages of 120 interns in 2014, with companies or charities who could not otherwise afford it, but that halved to 60 last year. It has also moved from running workshops, for graduates seeking help with their application skills, to contacting them individually over the phone, and has signed up a dozen volunteer mentors, to cope with tighter funds.

Government support has fallen from £515,000 to £220,000 in two years.

“It is challenging, but it is great in a way because we feel more in control,” Ms Lewis said. “We would love more funding or we will never be able to fund those charity start-ups that we really want to work with.”

She said 50 per cent of placements were now “repeat business” with satisfied organisations, and 20 per cent were coming from referrals. “They are all paying, so we are doing something right. It gives us a breathing-space.”

AAI works with companies from Diageo and Abellio to SMEs who value the association. “To be associated with AAI means they can be seen to be paying their interns and doing things correctly.”

On what she a year ago called a “dreadful unpaidship intern culture” in England, Ms Lewis commented: “It still happens in certain areas, big charities are still guilty and so are the fashion and PR industries. The government is not pushing paid internships so people are getting away with it. But they are beginning to feel the pinch on it, people are making them feel uncomfortable.”

Unlike some corporates, AAI moves quickly. “We can have somebody in place within three to four weeks, which is almost unheard of….we just present them with three people to interview.”

Ms Lewis says businesses soon come to realise “they are not helping out a graduate, he or she is coming in to help them”. She says AAI has contributed some £30m to the Scottish economy in the wage value of the permanent jobs it has triggered, not counting added benefits to companies.