Levy proposals from the CITB have been challenged by BESA, as the organisation questions what employers gain from it
The Building Engineering Services Association (BESA) has raised concerns about the Construction Industry Training Board’s (CITB) new levy proposal, questioning the need for it.
Earlier this week, the CITB launched a consultation on a new levy that, if passed, would come into force in 2018. The plans would see the CITB cut its employer payroll levy from 0.5 to 0.3 per cent.
Is the levy needed?
BESA said while the reduction in charges would be welcomed some firms are paying twice, which begged the question of why the levy is needed.
Training director Tony Howard said: “The big question for employers is whether there should be a CITB levy at all.
“The CITB has not been able to spend all the money it raises through the levy for years and cannot get funding to more than nine per cent of SME’s.
“Every so often it needs to reduce the embarrassing amount of money it has sitting in the bank, so it builds websites and does roadshows trying to engage SME’s in obtaining grants from a system they don’t understand,” he claimed.
Furthermore, Howard said the cuts would not make much of a splash on the organisation, as it can afford to reduce its income by that amount without seeing any negative impact on current activities.
“Many employers would say it is not necessarily the amount of levy that is being raised from them that is the problem, but the effectiveness of the support derived from it,” he said.
“I think the time is right for the CITB to explain how it will give employers a real tangible return on their investment through the levy that is innovative, clear, concise and easy to access.”
Future relevance of the CITB
He did praise the principle behind the training levy, which seeks to level the playing field for employers while ensuring training is undertaken. However, he expressed it was difficult to see the point of multiple funding streams.
“The future relevance of the CITB is less clear,” said Howard.
“Later this year, all employers will get the chance to exercise their democratic right and vote on the future of the CITB Levy.
“As we now have an Apprenticeship Levy, the obvious question is whether there should be two funding streams.”
Employers will be given the opportunity to vote on the levy proposal between August and September. The government will then give a decision on whether it can proceed by February 2018, just before the new government Apprenticeship Levy comes into effect in April.
“However, companies with a payroll over £3m and who are in scope of the CITB will have to pay both levies for a year,” said BESA.
The CITB has been under the spotlight recently, with the board’s spending coming under scrutiny last year. Concerns were also raised by the BSRIA that the organisation could be rendered obsolete due to the government’s apprenticeship levy.
Levy is necessary
Launching the consultation CITB CEO Sarah Beale said the levy was necessary to ensure equality across all employers.
“We have been listening to our industry and are confident that this levy offer is the best option.
“It will provide the funding required to deliver the support that industry needs, is simple to administer, and is straightforward for levy payers.
“Next month, we kick off the next stage of engaging with our industry. We will discuss with employers our proposals for how we support them better and consult on how we fund this through the levy.
“We want to ensure that our offer is relevant, makes a real difference and delivers value for money.
“We want as many as employers as possible to share their views and we will shortly be sharing details on how to get involved in the consultation.”
