Secretary of State for Business, Vince Cable, and Minister for Skills, John Hayes launched the Growth Investment Fund (GIF), which it hopes will help employer groups overcome barriers to growth within their sectors and industries.
The funding could deliver new training to boost innovation and productivity, enable industries to set new professional standards, or support new or extended National Skills Academies.
BIS will invest up to £50m per year in partnership with businesses, whose investment alongside Government could deliver a total of up £100m a year.
Cable said: "This Government understands that to rebalance and grow our economy, we need to tackle the skills shortages that hold companies back. Through this fund, we will support employers that take collective action to overcome these blockages to expansion.
"By putting the employer voice at the heart of the process, we will reward inventive approaches to training that deliver real help to get business moving."
But Unite assistant general secretary, Tony Burke, said: "The Government's announcement is yet another 'knee jerk' reaction to a problem Unite has been warning about for a number of years.
"There are a number of companies who do invest in the skills of their workforce. However, we are facing skill shortages because of a 'make do and mend' attitude from some employers and the lack of awareness of the benefits of taking on apprentices and retraining the workforce.
"We are also aware that some companies will not invest in skills and take on apprentices, because they don't know what is round the corner. They are fearful of interest rate increases. A number of companies who provide goods to the public sector are concerned as to whether the orders will dry up through the government's austerity measures - some companies have told us they just will not take the risk.
"Equally, the £50 million per year has to be match-funded by employers and we doubt whether some industries in manufacturing will show enough interest. We note that the Government has now resurrected the issue of voluntary levies but our experience shows that employers will shy away from voluntary levies.
"What we really need is a long-term skills strategy, easily understood by industry, backed up by compulsory levies for those industries who fail to take on sufficient apprentices and invest in training. If this government is serious about rebalancing the economy, we need to invest in the UK's manufacturing skills base with a long-term solution."
