Industrial Training Levy (Construction Industry Training Board) Order 2026

Lord Jones Excerpts

Monday 9th March 2026 Grand Committee

[Baroness in Waiting/Government Whip (Baroness Blake of Leeds) (Lab)]

My Lords, I thank the Secondary Legislation Scrutiny Committee and the Joint Committee on Statutory Instruments for their scrutiny of this draft order, laid on 2 February 2026.

The statutory purpose of the Construction Industry Training Board, or the CITB, is to secure better training provision across the construction sector. The 2023 independent review of the industry training boards, led by Mark Farmer, reaffirmed their continuing value in addressing persistent and structural workforce challenges. Crucially, the review concluded that a statutory levy remains the most effective model for securing the level of skills investment that the industry requires.

This statutory instrument gives effect to the CITB’s levy proposals for 2026, 2027 and 2028. The levy remains the CITB’s primary funding source and, without this order, the board cannot raise mandatory assessments on in-scope employers. Levy funding enables the CITB to deliver essential support to tackle skills shortages and market failures across England, Scotland and Wales. Although views in the sector can vary, the levy proposals continue to command strong employer support. These proposals are the result of detailed consultation and a robust consensus process. In spring 2025, the CITB consulted all 14 prescribed organisations, or sector federations, alongside a structured survey of non-represented employers. Over 67% of levy-paying employers supported the proposals, representing almost 72% of levy value—well above the thresholds for consensus to be achieved.

Before we consider the levy proposals in further detail, I will return to the findings of the Farmer review. I am pleased to confirm that the Government intend to consult industry on bringing together the CITB and the Engineering Construction Industry Training Board to create a single unified body, supporting the combined skills needs of construction and engineering construction. This reflects a key recommendation of the Farmer review, accepted by the Government subject to further scoping. It builds on existing ITB collaborations such as the Sizewell C charter: a joint commitment by the ITBs, local authorities and Sizewell C to ensure a skilled and inclusive workforce for delivering this vital nuclear power station.

The consultation will launch shortly and the views expressed by industry will inform a decision on how to proceed. No outcome can be prejudged and the earliest that any change could take effect is April 2027. Any future levy arrangements arising from reform would come before Parliament in the usual way. Until then, maintaining the CITB’s ability to operate effectively makes approval of this statutory instrument essential.

To turn to the levy proposals, this SI maintains current levy rates. Despite a 36% increase in employer demand for CITB services since 2021, rates are held steady to support businesses navigating difficult trading conditions. The order also raises exemption and reduction thresholds to protect small and micro-businesses from levy pressures linked to wage inflation. Employers with wage bills up to £149,999 will be exempt, while those with wage bills between £150,000 and £499,999 will receive a 50% reduction. Approximately 69% of eligible employers will therefore continue to pay no levy, with a further 15% paying a reduced rate. All these employers remain eligible for CITB support.

The CITB estimates that the levy will raise around £243 million per year to invest in supporting skills needs. In the most recent year, the CITB supported over 30,000 apprentices and 20,000 vocational qualification achievements and provided nearly £130 million in grants, including £60 million for small and micro firms. It also committed up to £40 million for fast-track training and apprenticeships in areas of high demand for homebuilding skills.

This funding directly underpins broader economic priorities. The construction sector contributes over £211 billion annually and employs more than 2 million people. Yet its fragmented nature, characterised by high self-employment and complex supply chains, makes voluntary, industry-wide investment in skills unlikely to occur. Without a statutory levy, the workforce needed to deliver the UK’s economic ambitions simply would not materialise at the required scale. If this order were not approved, the CITB would be unable to collect levy in 2026, impacting apprenticeships, qualifications, employer support programmes, training standards and the future capability of an industry fundamental to growth, housing delivery and national infrastructure.

The UK requires an estimated additional 240,000 construction workers by 2029, with particular pressures in infrastructure, repair and maintenance, and homebuilding. Agreeing this order is therefore critical to delivering the Government’s commitment to 1.5 million safe and decent homes this Parliament and to supporting major infrastructure and clean energy projects across Great Britain. The proposals have the full support of the devolved Governments in Scotland and Wales, who, like industry, recognise the importance of maintaining the CITB’s ability to raise and invest levy income. For these reasons, I commend the instrument and I beg to move.

[Lord Jones (Lab)]

My Lords, I thank my noble friend for her helpful and informative remarks. Skills and training are crucial for Britain, struggling to keep her place in a very competitive global market, and this board is a great and important player in British skilling. It is a good measure and I think that £243 million are involved somewhere in the helpful notes that the department has offered us.

I have some questions that I think might be answered by officials. Very briefly, what is the current grand total of construction apprenticeships for the latest year available? Are there graduate apprenticeships in this industry, and in what numbers? Is the department satisfied with its health and safety record, given the nature of the industry that we are considering?

I find that this proposal brings memories which I think are relevant to anyone considering the future of this great industry. It was the case that, in the early 1980s, big changes were made in these boards. I recollect that, in the other place, the Secretary of State, James Prior, was helped by a Parliamentary Secretary by the name of Morrison.

Time and again, after 10 pm and with three-line Whips, we had orders to abolish board after board—to the point where, although the Opposition of whom I was a part always voted against abolition in this instance, the Government usually had their way. All that was left of these training boards were the great engineering board and the construction industry board. It seems that the start of the problems that Britain now faces around skills and training relates to the decisions taken by the then Government in voting that always happened after 10 pm and went on until midnight. The Government of the day had a good majority, so they got their way.

When I was in the other place, I found that builders were very much against what was proposed in having these issues put on them. I found that, in an era of mass unemployment in the early 1980s, it was very obvious that the apprenticeship boards were being closed down. Even the great companies of Courtaulds, BAE and British Steel pretty well decided not to have apprenticeships. The bottom line was: what was to be made if there were to be any chances of what I would call advantages from the great loss to Great Britain and to our young people? If we look back to those years—the late 1970s and, in particular, the early 1980s—there were great problems.

I hope that the questions I have asked will be answered before the end of the debate.

[Baroness Bennett of Manor Castle (GP)]

My Lords, it is a pleasure to follow the noble Lord, Lord Jones; his long and extensive memories of the issues here really highlighted the depth and length of the problem that is the background to this statutory instrument.

I thank the Minister for her introduction, which was very clear. I also commend the impact assessment—my plaudits go to the people who prepared it—because it is far better than those that we see for many of these SIs. It sets out a picture of an industry, the construction industry, which is in deep trouble when we need it to be tackling the incredibly poor quality of housing stock in particular and building stock more generally, for which the building in which we are standing might be taken as a symbol. We have here an SI whose proposals, to quote the impact assessment, “include little change” for 2026 compared with 2025. The problems are much broader; an industry training levy can tackle only so much.

I have some questions for the Minister; I will understand if she wants to write to me rather than respond from the Dispatch Box. Paragraph 13 of the impact assessment highlights the heavy reliance on subcontracting and self-employment. This is associated with very poor levels of mental health in the construction sector. The figures on suicide and attempted suicide among employees in the sector, who are often on very low wages and in very insecure employment, are deeply concerning.

That is a huge human problem, but it is also a huge problem for the workforce. As the impact assessment says:

“The industry is very cyclical, with drops in output and employment when there is an economic downturn”.


I recall being at a National Insulation Association conference, in 2011, I believe, when it basically said that the industry was closing down because government funding for it had stopped, and that all its most skilled people were going off to do something else and probably would not come back when there was an uplift.