HL Deb 28 January 1993 vol 541 cc1383-6

4.19 p.m.

The Parliamentary Under-Secretary of State, Department of Employment (Viscount Ullswater) rose to move that the draft order laid before the House on 30th November be approved [13th Report from the Joint Committee].

The noble Viscount said: My Lords, it may be for the convenience of the House if I speak to this order and the following order together. The proposals before your Lordships this evening seek authority for the Construction and Engineering Construction Industry Training Boards to impose a levy on the employers in the building and civil engineering and engineering construction industries to finance the running costs of the boards and fund their range of training initiatives, including grant schemes.

Provision for this is contained in the Industrial Training Act 1982 and the orders before your Lordships would give effect to proposals submitted by the two boards. Both proposals include provision to raise a levy in excess of 1 per cent. of an employer's payroll. The Industrial Training Act 1982 requires that in such cases the proposals must be approved by affirmative resolution of both Houses. In each case the proposals are the same as those approved by your Lordships last year. They are based on employers' payrolls and their use of sub-contract labour. Both have special provision for small firms.

For the CITB the rates are 0.25 per cent. of payroll and 2 per cent. of payments made by employers to labour-only sub-contractors. Employers with a liability of £45,000 or less will be exempt. The ECITB treats its head offices and construction sites as separate establishments and applies different levy rates which reflect the actual costs of training particular workers. For head offices the rates are 0.4 per cent. of payroll and 0.5 per cent. of payments to labour-only sub-contractors. Firms employing 40 or fewer employees are exempt. The rates for sites are 1.5 per cent. of payroll and 2 per cent. of labour-only payments with exemption for employers with a liability of £75,000 or less.

In each case the proposals have the support of the employers in the industry as required by the Industrial Training Act and have the full support of the respective boards. Your Lordships will know the CITB and the ECITB are the only two remaining statutory industry training boards. Most other sectors of industry are covered by independent arrangements. The Government believe that in the overwhelming majority of cases independent employer-led arrangements are the most effective.

Your Lordships will be aware the CITB is currently under review. This has, I know, given rise to much speculation and concern. I hope your Lordships will be reassured when I say that, as in 1990, we have consulted widely with the industry about the effectiveness of the board and its current funding arrangements. The Government are not yet able to make a statement about the board's future but I can say that the results of that consultation will be extremely important in informing our decision. Although there is still work to be done, an announcement should be made shortly.

In the meantime though the operations of both these boards continue as normal. I believe it is right for 1993 that the House should agree to approve the draft orders before it. I commend them to the House. I beg to move.

Moved, That the draft order laid before the House on 30th November be approved [13th Report from the Joint Committee].—(Viscount Ullswater.)

Baroness Turner of Camden

My Lords, I thank the Minister for his explanation of these two orders. As he has rightly said, they are very similar to the orders which have been approved by your Lordships' House on previous occasions and on that score we certainly have no opposition to offer from these Benches. I am glad, however, that the Minister has addressed the question of the future of the CITB. I gave him notice that I would raise that matter as I have raised it in the past.

I am sure the House will appreciate that in a situation where the future is uncertain, because the review is still not complete and consultations are proceeding, the staff involved naturally do not feel terribly secure as regards their future. Certainly I should have thought it was in everybody's interest that a decision is made as quickly as possible. Your Lordships will be aware, of course, that we on this side of the House supported industry training boards and were sad to see their demise.

We believe the Construction Industry Training Board has done a good and effective job. Because of the special circumstances that apply in construction there is a case for maintaining a board and the system which the board itself runs. I therefore hope it will not be very long before the Government make a decision and the fears and uncertainties that exist in the minds of the people who work for the board will then be laid to rest. I am glad that full consultation is taking place with everyone concerned. It is my information that the industry in general is in support of maintaining the CITB. I hope that the Government will come to that decision. We offer no opposition whatsoever to these orders; indeed, we support them.

Lord Rochester

My Lords, from these Benches I wish to thank the noble Viscount, Lord Ullswater, for having introduced these orders so clearly. I am glad the Government decided that the two boards should be allowed to continue at least for a further period and that under the orders they are authorised once more to raise a levy on employers in the construction industry at the same rates as those which applied last year. It is an industry which, because of the mobile nature of the workforce and the extensive use of contract and self-employed labour, could hardly be treated, as I see it, in any other way.

Against the background of continuing job losses in the industry it is vital that the skill level of construction workers should be maintained by means of training to counter the tendency of unemployment to reduce it. Otherwise, when the upturn comes—we on these Benches have remarked on this point on a number of occasions—the industry will once again find itself disastrously short of the craftsmen it will need and that will lead to inflationary pressures as employers compete with each other for scarce skills by offering higher wages.

Like the noble Baroness, Lady Turner of Camden, we shall await with interest the outcome of the review to which the noble Viscount referred. We hope that in the special circumstances of the construction industry it will be possible for those boards to remain in being and for them to be in a position to plan ahead for a reasonably long period. That is not something they have been able to enjoy recently. The noble Viscount knows that in my view the Government themselves could well spend more on training. However, that is a matter for another day. I have no further comments to make on the contents of the orders themselves and I am accordingly happy to accept them on behalf of my noble friends.

Baroness Hooper

My Lords, I should be most grateful if my noble friend the Minister would be kind enough to confirm one specific point. I believe there is some anxiety among members of the consulting engineers' profession. They had understood from the 1988 White Paper entitled Employment for the 1990s that consulting engineers would not fall within the scope of the Industrial Training Board as they constitute largely a permanent workforce. They constitute a qualified workforce and they have established training schemes of their own. I hope my noble friend can confirm that point.

Viscount Ullswater

My Lords, I thank the noble Baroness, Lady Turner of Camden, and also the noble Lord, Lord Rochester, for the welcome they gave to these orders. These orders are, of course, particular to the construction and engineering construction industries. Those industries are different from most—the Government have recognised that—and need to be treated accordingly. I very much take to heart the comments of the noble Baroness about the concerns staff have as regards the future of the CITB. All I can do at the moment is to assure her that Ministers are currently considering that matter. I hope an announcement will be made soon.

The noble Lord, Lord Rochester, put his finger on an important factor when he mentioned the mobile nature of the labour force we are discussing and the difficulty that poses for training. He mentioned the importance we need to attach to skill levels and to maintaining them. I agree with the noble Lord that the money that is raised from the levy is extremely well spent in that area.

My noble friend Lady Hooper asked me a question about consulting engineers. Whereas I believe they are within the scope of the order, and therefore that the ECITB has been active within its proper remit, I understand that a feasibility study is being set up to establish the demand for an independent industry training organisation for consulting engineers. I suggest that my noble friend's point might be considered alongside that study.

As I have intimated, the proposals have the support of the respective employers and have been approved by the boards. I believe that it is not in dispute that they should be approved by your Lordships. I commend the order to the House.

On Question, Motion agreed to.