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Industry votes yes to future of CITB Levy - but calls for change


The Construction Industry Training Board’s (CITB) proposed Levy rate has been backed by the sector – alongside calls for reform.   

The vote showed strong support for CITB’s continued Levy-raising powers, across employers of all sizes in England, Scotland and Wales.

This comes at the end of the CITB’s triennial Consensus process, during which 14 federations and 4,000 non-represented employers were asked whether or not they support the proposed levy rate.

Following CITB’s biggest-ever consultation with industry, the proposed Levy rate for this year was set at 0.35% for all PAYE employers, down from 0.5% in previous years. The subcontractor NET CIS rate remains at 1.25%.

Final results from the independent employer survey and responses from Consensus federations reveal that 76.9% of employers across Great Britain support the Levy, representing 69.7% of the total value of Levy paid in.

Across the three nations, 10 out of the 14 federations voted in favour of the Levy while the survey of non-represented employers showed support at 72.4% based on the number of employers and 66.1% based on the value of Levy assessments.

In England, 71.2% of employers surveyed support the Levy. Responses in Scotland and Wales show increasing support with 8 out of 10 (79.1% and 79.2%) of employers voting ‘yes’, respectively. 

The survey also revealed that the majority of firms of all sizes support the Levy - 74.2% of large and medium firms, 75.9% of small firms and 71.6% of micro firms all voted in favour. 

Sarah Beale, CEO at CITB, said:  “The results are clear – construction firms across Great Britain have come together to commit to deliver a skilled construction workforce for the next three years. The Consensus process this year has been rigorous, robust and inclusive – with more employers consulted than ever before.

“Whilst we have been backed by our industry, we’ve heard the calls for change loud and clear. Be assured that we will continue listening to industry and along with recommendations from the Government’s upcoming review into industry training boards, will use all we learn to inform our reform process.

“We are completely committed to modernising our organisation by renewing governance, ensuring accountability and improving outcomes. It is what industry expects and we will deliver.”

The results will now be submitted to the Department for Education for verification and approval before the Secretary of State asks Parliament is asked to approve the new Levy order.

Summary

The current levy rates are:
PAYE contribution of 0.5%
Net CIS contribution of 1.25%.

And the payment thresholds are:
Employers with a wage bill of less than £80k are exempt
Employers with a wage bill of between £80k and £399k receive a 50% deduction on the levy assessment
Employers only pay the full assessment if their wage bill is £400k or above.

For 2018-2020 the proposal is that for all levy payers:
The PAYE contribution will reduce to 0.35% (was 0.5%)
NET CIS contribution will remain the same (1.25%)
Payment thresholds will remain the same

Summary of results

Weighting together the responses from the Prescribed Organisations (POs) and the non-represented employer view from the survey shows a clear level of support for the Levy Proposal, both by number of employers (volume) or by value of levy paid. It also shows that support was consistent across the Three Nations and by employer size.

Overall:

  • 76.9% of employers supported the levy by volume
  • 69.7% of employers supported the levy by value.  

Survey Details:

Carried out by IFF Research Ltd (July – Sept 2017)

Covered employers liable to pay levy that were not represented by any of the Prescribed Organisations (i.e. a Consensus Federation)

Total number of survey responses: 4,000

Results: % Support for Levy Proposal by Volume

 

Yes

No

Don’t Know

Overall

72.4

21.1

6.5

 

 

 

 

Large &Medium

74.2

12.9

12.9

Small

75.9

16.8

7.3

Micro

71.6

22.5

5.8

 

 

 

 

England

71.2

22.0

6.8

Scotland

79.1

15.1

5.8

Wales

79.2

16.3

4.5

 

Results: % Support for Levy Proposal by Value

 

Yes

No

Don’t Know

Overall

66.1

24.1

9.8

 

 

 

 

Large &Medium

71.8

15.6

12.6

Small

66.9

21.9

11.2

Micro

57.2

34.9

7.8

 

 

 

 

England

65.1

24.3

10.6

Scotland

68.3

26.3

5.4

Wales

81.0

16.5

2.6

Prescribed Organisations support for Levy Proposal (i.e. Consensus Federations) as at 02 Oct 2017

Name

Response

Build UK

YES

British Woodworking Federation (BWF)

YES

Civil Engineering Contractors Association (CECA)

YES

Construction Plant-hire Association (CPA)

YES*

Federation of Master Builders (FMB)

YES

Finishes and Interiors Sector (FIS)

NO

Hire Association Europe (HAE)

YES

Home Builders Federation (HBF)

NO

National Association of Shopfitters (NAS)

YES

National Federation of Builders (NFB)

YES

National Federation of Demolition Contractors (NFDC)

YES

Scottish Building Federation (SBF)

NO

Scottish Decorators Federation (SDF)

NO

Scottish Plant Owners Association (SPOA)

YES


Read industry reaction to the CITB Levy vote.

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