News

Construction leaders back CITB reform

The Construction Leadership Council (CLC) has announced it wants to see CITB reformed rather than shut down, as consultation on the training organisation's triennial review draws to an end. The latest industry consensus vote on whether to back continuing support for payments to the CITB comes against the backdrop of this year's introduction of the Apprenticeship Levy, which demands additional payments from all employers with an annual payroll of more than £3 million.

Balfour Beatty chief executive Leo Quinn, who is at the helm of the biggest contributor to the CITB, has said his company will not support the continued existence of the training organisation because it has failed to deliver on its remit of providing the skills the industry needs and because industry has not been given opportunity to view proposed CITB reforms before the vote concludes. There is also no guarantee the promised reforms will be implemented, he said.

"We are voting in the dark, recommitting to a CITB Levy – and thus to an organization, whose potential ongoing failure would have a major impact on future economic growth," Quinn said.

"The Levy paid into the CITB – let alone its other income - provides it with a budget comparable to a good-sized public company. But while Plcs are subject to rigorous corporate governance, CITB has a fundamental governance weakness: it is not closely and regularly accountable to the industry it exists to serve.

"So while we welcome the CITB’s statement that it recognises its failings and has begun a reform process, we its stakeholders, in every sense its investors, customers and underwriters, nee much more information on what the reformed body will look like and what it will deliver."

Quinn held the role of skills lead on the CLC until he announced his resignation last week. Other commentators, such as Mace boss Mark Reynolds, have called Quinn's stance as reckless and unhelpful because the Balfours CEO has gone out on a limb without the backing of CLC or Build UK.

The CLC has now issued its statement, which appears to support Quinn's view; saying that it will support the CITB on the condition that a new accountable governance structure is put in place as part of the reform process. Balfour Beatty's statement says the company has not yet made its final decision on whether to withdraw its Consensus vote in support of CITB because it still awaits a response to its latest request for further information on the CITB reforms proposed in a report on the training body by the government's former chief construction advisor, Paul Morrell.

"We absolutely must have robust assurances that these recommendations will be fully implemented. In brief, we need a new mechanism that provides an effective check on CITB’s delivery and clear sanctions in the case of failure," Quinn's statement says.

"This is not the first instance of the industry being told CITB will reform itself. This time, we cannot afford to lose another three years if it fails to deliver. The stakes are too high for us to sleepwalk over the skills cliff.," he adds.

The full CLC statement is as follows:

The Construction Leadership Council (CLC) is aware that the consultation period associated with the CITB’s triennial review is drawing to a close.  The CLC acknowledges the key role that CITB plays in connection with the maintenance and development of the construction industry’s skills base.  The CLC recognises the need for a national organisation supporting the delivery of construction skills, but is also clear that the current status quo is unsustainable.  The CLC’s view is that the CITB must be much more strategic, industry-led and accountable. 

The CLC is supportive of a reformed CITB on the basis that an appropriate governance structure is implemented as part of the proposed reforms.  To be effective, the CITB’s governing body must comprise industry leaders representing all tiers of the industry, providing the mechanism for the CITB to be industry-led and accountable.

Should the triennial review confirm the continuing support of the industry for a reformed CITB, then the CLC will work with Government and Industry to ensure that an appropriate governance structure is put in place, that industry representation is of an appropriate calibre to provide strategic input to the CITB, and that communication with the industry is improved.  We will also work with the CITB on an ongoing basis to help deliver the CITB’s reform programme, and the skills the construction sector will need in the future.

The current triennial review of the CITB has taken place against the backdrop of the introduction of the Apprenticeship Levy.   We recognise the combined impact of the two levies on the industry and believe that much more needs to be done to help construction access the funding provided by the Apprenticeship Levy.  

The CLC has communicated industry concerns to government with respect to the impact of the Apprenticeship Levy on the construction sector, given the existence of the CITB Levy.  Should the opportunity arise to review the detailed design and implementation of the scheme, then the CLC will participate in the review in support of the Construction industry’s desire to be treated fairly under levy proposals.

In the meantime, and recognising that a reformed CITB has a key role in supporting the development of new and existing skills development, the CLC will work with all parties including CITB to ensure that the industry secures maximum benefit from the Apprenticeship Levy – particularly with respect to new skill sets required by the Digital Manufacture Performance agenda (DMP) that the CLC is delivering through its Construction 2025 strategy.