No Change on CITB Levy as Just 0.4% Respond to Draft Consultation

THE DRAFT PROPOSED Construction Levy rates will remain the same for 2022-25 it was confirmed by the CITB Board on 21 May

Now the draft has been confirmed, industry support will be measured again this summer for the actual proposal.

CITB consulted with construction employers and industry representatives earlier this year on draft Levy Proposals. Just 281 employers responded – that’s just 0.4% of CITB registered businesses.

The confirmed proposals (that will now be consulted on again in Consensus) are that the Levy is assessed at the pre-pandemic rates of:

• PAYE at 0.35%
• Net paid (Taxable) CIS Sub-contractors at 1.25%

Approximately 40,000 employers with a wage bill below £120,000 will continue to be exempt, with 14,000 seeing a 50% reduction due to having a wage bill of between £120,000 and £400,000.

CITB anticipates more construction businesses could qualify for exemptions and Levy reductions due to lower wage bills.

Final Stage of Process

The final stage of CITB’s three-yearly statutory consultation takes place between 14 June and 15 August. This asks for feedback on the Levy proposed to fund CITB support for construction skills over the next three years.

The Consensus question to be asked is, do you agree that the Levy Proposals are necessary to encourage adequate training in the construction industry?

CITB Criticised

Sarah Beale, CITB CEO

CITB has been criticised for mis-judging the pandemic and its effect on construction. In June, CITB voluntarily cut its income by 50% over 2 years. The cut came as construction firms started to experience a huge surge in demand. This demand has produced even more pressure on recruitment of skilled labour and widened the skills gap. In November 2020 CITB’s CEO Sarah Beale announced she would be leaving the organisation in September 2021.

Steve Radley, Director of Strategy and Policy at CITB, said: “To support employers, Levy bills were cut by half for 2021, with the Consensus process delayed by a year to focus on supporting immediate skills needs.

“We have since had clear feedback from industry, including the 14 Prescribed Organisations, that CITB should proceed with Consensus this year.

Steve Radley, CITB Policy Director

“We now expect significant growth in construction output and its skill needs over the next three years. We have recently agreed a plan to help meet these needs and we are now asking industry whether it supports the Levy Proposals to finance it.”

Of 33,000 Levy-paying employers, around 7,000 have declared they are represented by Prescribed Organisations, so their views will be gathered through their Prescribed Organisation. Of the remaining 26,000 employers, a representative sample of 4,000 will be surveyed by telephone by IFF research Ltd, an independent research company.

In 2017, the last time the Consensus process was undertaken, there was agreement to the Levy Proposals from 76.9% of construction industry respondents.

The results of the 2021 CITB consultation will be published in the autumn.

>> Read more about the CITB in the news