Industrial Training Levy (Construction Industry Training Board) Order 2026

Lord Hunt of Wirral Excerpts

Monday 9th March 2026 Grand Committee

Finally, the impact assessment focuses very much on new homes and buildings. The refurbishment of our incredibly poor housing stock is a huge challenge. In some ways, that is an even more fragmented part of the industry, but it also has the potential to be a steady, continuing source of employment, given that the demand is enormous. I talked about this once at a public meeting, and someone said to me, “What are you going to do with these workers when they run out of houses to insulate and repair?” I said, “That’s a problem for a couple of generations’ time. It won’t be a problem any time soon”. What are we doing to make sure that we are equipping our workforce? In many ways, refurbishing old homes—Victorian homes or older—is a particularly complex task that really needs skills. What are we doing to inject those skills into our workforce?

[Lord Hunt of Wirral (Con)]

My Lords, I join the noble Lord, Lord Jones, and the noble Baroness, Lady Bennett of Manor Castle, in thanking the Minister for introducing this order and setting out its purpose so clearly. I confirm at the outset that the Opposition support it.

As the Minister outlined, the order enables the Construction Industry Training Board to continue raising the levy for a further year in order to support training across the construction sector. As the noble Lord, Lord Jones, reminded us, the levy system has a long history, originating in the Industrial Training Acts of 1964 and 1982. The system exists to address a well-recognised challenge within the sector—namely, without co-ordinated action, investment in training and skills can fall far short of what is required. This is particularly important at a time when the construction industry faces significant workforce pressures. The sector employs around 2.6 million people, yet, as the Minister explained, thousands of additional workers will be required each year to meet future demand.

The noble Baroness, Lady Bennett of Manor Castle, identified one or two key questions. I join her in expressing concern about the mental health aspect that she outlined; it raises deep concern and needs to be addressed. In addition, if we are to have a strong and sustainable skills pipeline, the noble Baroness was right to draw attention to paragraph 87 of the draft impact assessment and the need for a pipeline that will be diverse and wide-ranging to ensure that we deliver wider economic and infrastructure priorities. The work supported by the levy clearly plays an important role in that effort. Grants for apprenticeships, qualifications and short course training, as well as initiatives such as the travel to train grant and the new entrant support scheme, provide valuable support to employers and learners right across the industry. It is also encouraging to see that a large proportion of the support reaches the vital small and micro-businesses that form such a significant part of the construction sector.

While we support the continuation of the levy, I would be grateful if the Minister could clarify a few points, as well as answering the specific questions that the noble Lord, Lord Jones, and the noble Baroness, Lady Bennett of Manor Castle, have asked. First, given the scale of the projected workforce shortfall in construction, how confident are the Government that the current level of the levy will be sufficient to meet the sector’s future skills needs? Are there ongoing discussions with the Construction Industry Training Board about how the levy and its associated programmes might evolve to respond to these pressures?

Secondly, one of the long-standing challenges in construction is the industry’s aging workforce and the difficulty of attracting new entrants. Can the Minister say a little more about how the Government see the levy supporting efforts to bring more young people into construction careers? The noble Lord, Lord Jones, reminded me that he and I used to face each other across the Dispatch Box in the House of Commons, when I was the Minister and he was the shadow—a reverse of what had happened a little earlier when he was the Minister and I was the shadow. We have a combined wish to see an increase in apprenticeships. The noble Lord, Lord Jordan, came up with the concept of a new form of apprenticeship and I was happy to play a part, with my noble friend Lord Clarke of Nottingham, in launching the modern apprenticeships. It would be helpful to know from the Minister exactly what is happening with the need to increase those modern apprenticeships and their availability.

Finally, given the high proportion of small and micro-businesses in the sector, will the Minister tell us what steps are being taken to ensure that these firms are able to access the support available through the levy as easily as possible?

With those brief questions, I reiterate that we support the order and the continuation of the levy. Ensuring that the construction sector has access to the skilled workforce it needs will be essential in the years ahead. The mechanisms such as this levy have an important part to play in that effort, so I am happy to support the Motion.

[Baroness Blake of Leeds (Lab)]

I start by saying how grateful I am for the contributions to this debate and for the thoughtful scrutiny. I have learned a lot from my noble friend Lord Jones about the background and I thank him for his input on that. It is important that we all understand where we have come from and where we are hoping to get to in this important debate. All the contributions have highlighted the scale of the challenge facing us. As the noble Lord, Lord Hunt, outlined, this is one of our most economically vital sectors, responsible for £200 billion of output and the employment of over 2 million people. The future of our economy and our ability to grow depends on this.

As shown in the tenor of the contributions today, we need to make sure that over the coming decade we have a stable and collective system of investing in training, as well as looking at new initiatives. What we can all absolutely say is that market forces alone will not deliver the pipeline of skilled workers that the industry urgently needs, whether in meeting the demand for new homes or, as the noble Baroness, Lady Bennett, quite rightly said, for the complex issue of retrofitting, which sounds straightforward but we know is not—it is exceptionally challenging. Against the bedrock of the need for economic growth, the transition to net zero is a fundamental driver in our ability and our attempts to make the progress that we need to.

There is a focused skills strategy now. It recognises that the construction industry is at its centre and, as has been raised by all, it must benefit and bring support for all sizes of business. It is that unique make-up of the sector that provides opportunities but also presents enormous challenges. We have to make sure that where we offer training it is of the highest quality. It is not just about young people; it is about retraining and upskilling the existing workforce to make sure that they can progress in their careers.

Specifically, I say to my noble friend, there were 24,470 apprenticeships in construction for the year 2024-25, representing 7% of all starts. I am afraid that we do not have the number of graduate apprenticeships, so I cannot answer that specific question.

I will move on to the wider package of support. From a personal perspective, having worked in this space in my previous role, I know that the initiatives aimed at supporting the mayoral authorities are fundamental, making sure that the approach can be delivered locally as well as being supported from the centre, and having a real understanding of the local jobs market, environment and training needs and the relationships that need to be built to do that.

The Government are delivering major investment to strengthen construction skills and the wider skills system. The £625 million construction skills package includes £100 million to expand the construction skills boot camps, £98 million for industry placements and around £100 million to establish 10 technical excellence colleges, boosting opportunities for young people through a £90 million uplift for construction courses for 16 to 19 year-olds and £75 million for adult retraining. This recognises the immediate needs and the fact that we need to bring new young people in and make the whole area attractive to young people. We have been through a phase where it has not been so attractive, but the opportunities are enormous.