HL Deb 08 February 1988 vol 493 cc67-9

7.15 p.m.

The Earl of Dundee rose to move, That the draft order laid before the House on 13th January be approved [12th Report from the Joint Committee].

The noble Earl said: My Lords, our debate today takes place because any industrial training levy order which involves a levy exceeding 1 per cent. of an employer's payroll must receive parliamentary approval under the Industrial Training Act 1982. In the case of the engineering board, one part of the levy proposals—that covering site employees in the mechanical and electrical engineering construction sector—establishes a levy rate of 1.12 per cent. and thus requires approval under the affirmative resolution procedure.

The board's levy proposals for 1988 show no change from those approved by this House in March last year. The board anticipates that it will raise some £19.6 million from the levy after allowing for exemptions. The levy will apply to those firms which fall within the scope of the board between the date that the order comes into force and 31st August 1988.

The levy proposals are in two parts; the first applying to mainstream engineering and the second to the mechanical and electrical engineering construction industry. I shall briefly outline the proposals in both sectors. For mainstream engineering establishments the board proposes a total levy of 1 per cent. of an employer's payroll. For an establishment with fewer than 1,000 employees, 0.08 per cent. of payroll will be non-exemptible. Larger establishments will pay a non-exemptible levy of 0.08 per cent. in respect of the first 1,000 employees, and 0.072 per cent. in respect of the remainder. The bulk of the levy is therefore exemptible; that is, employers who train satisfactorily will be given credit for this and will not be required to pay the maximum levy to the board. In addition, firms employng 40 workers or less will be excluded totally from paying levy. Some 68 per cent. of firms employing 12 per cent. of the workforce will be excluded from levy because of their size.

Turning to the mechanical and electrical engineering construction sector, again the levy proposals are the same as those approved last year. In this sector, arrangements differ for workers employed on-site and those employed off-site. For on-site employees, no levy is payable on the first £50,000 of payroll. Above that, a non-exemptible levy of 1.12 per cent. will apply, and 31 per cent. of establishments employing 0.5 per cent. of the workforce will be below this levy threshold.

For off-site employees, establishments with up to 30 employees will be excluded from levy. This will mean that some 79 per cent. of establishments employing 11 per cent. of the workforce will not pay the levy. Establishments with more than 30 employees will be levied at 1 per cent. of payroll. The non-exemptible element of this levy will be 0.15 per cent.

The raising of a non-exemptible levy in excess of 0.2 per cent. in the on-site sector means that the board must satisfy another requirement of the Industrial Training Act 1982. That is, that there should be a proven employer consensus in the industry for the proposals. Employer organisations representing more than half of the employers liable to pay levy—and also organisations representing employers liable to pay more than half the total levy between them— have confirmed their agreement to the proposals, thus satisfying the conditions required by the Act.

The proposals before the House were approved unanimously by the board and the Manpower Services Commission. They are necessary for the board to carry out its function of stimulating and encouraging training within the industry so that our engineering firms can compete and succeed in the international markets of this high technology age. I commend them to your Lordships. I beg to move.

Moved. That the draft order laid before the House on 13th January be approved [12th Report from the Joint Committed]—(The Earl of Dundee.)

Baroness Turner of Camden

My Lords, I thank the noble Earl for his explanation of the Industrial Training Levy (Engineering Board) Order. We on this side of the House welcome it. It is my understanding that it has the support of both sides of industry; the trade unions and the employers. The Engineering Industry Training Board has a good record of training and we believe that the order will help its work. On a personal note, I should like to say that I am glad that the EITB has had a significant effect upon the training of women in the engineering industry. It has done a great deal to encourage women to take up training in the engineering industry and has recently started a range of initiatives to encourage their training in this non-traditional field.

With those few remarks, I welcome the order. It will help the industry and the training within it. It is necessary to have training in this important high-tech industry for manufacturing, for exports and for the general economy.

On Question, Motion agreed to.

Lord Beaverbrook

My Lords. I beg to move that the House do now adjourn during pleasure until 8.15 p.m.

Moved accordingly, and, on Question, Motion agreed to.

[The Sitting was suspended from 7.21 to 8.15 p.m.]