0121 707 0077

Inflation guidance

Inflation guidance

The Managing Price Inflation guidance produced by Build UK has been updated with information on whether a contract can be lawfully terminated if inflation makes it commercial unviable. It outlines the key considerations, including the circumstances giving rise to termination and consequences if that step is taken.

Protecting against insolvency

Protecting against insolvency

With insolvency risk beginning to rival inflation as a threat to the industry, Director of KPMG’s Major Projects Advisory Team Joe Manning has outlined how to identify and respond to signs of insolvency in the supply chain. A combination of the following warning signs may indicate that a company on site is in distress:

  1. A high turnover of staff
  2. A general decrease in labour
  3. A slowdown in the progress of the works or the works not achieving project timescales or milestones
  4. Poor quality workmanship and/or an increase in defects
  5. Removal of plant, equipment and/or materials

KPMG has published a summary on preserving value under supply chain pressure which includes the measures that can be put in place to protect against insolvency and the steps that should be taken in the event that it occurs.

£6.2 billion worth of contracts awarded in August

£6.2 billion worth of contracts awarded in August

The latest information from Builders’ Conference shows that 460 contracts worth £6.2 billion were awarded in August. Both the number and value of contracts were higher than the monthly average over the last year, which is particularly encouraging given that August is traditionally quieter due to the summer holidays. It was a strong month for the public sector, which accounted for 39% of all contracts awarded by value, including two prison contracts totalling £650 million and three water and sewage projects worth £505 million. In the private sector, there were 136 housing projects worth £1.9 billion (30%), 24 industrial projects totalling £326 million (5%), and 67 office projects worth £319 million (5%).

The number of tender opportunities was still 8% below the previous month and, with the new Prime Minister now in place, the industry will be hoping that continued investment in infrastructure together with a plan to deal with rising inflation will sustain activity for the rest of the year.

Increasing employment in construction

Increasing employment in construction

With construction needing to recruit over 53,000 new entrants every year to maintain output, Build UK has published the results of its latest survey of members to understand current levels of employment within the industry and the impact of job vacancies across the supply chain. ‘Increasing Employment in Construction’ reveals that 33% of respondents have increased their number of directly employed workers in the last 12 months, with 50% predicting an increase over the next year, which is being driven primarily by an increase in activity, followed by companies taking on more new entrants and apprentices.

68% of Build UK members confirmed they currently have vacancies, which is increasing pressure on existing teams and stifling business growth. To help recruit more new entrants into construction, Build UK will be focussing on improving the journey from education to employment, and will be reviewing the various ways that young people take their first step into the industry, including Apprenticeships, Traineeships, T Levels and Degrees.

Free training to support businesses on their low-carbon journey

Free training to support businesses on their low-carbon journey

Eco-I North West is a practical, interactive project aimed at North West based SME’s that are starting their low-carbon innovation journey and are looking for opportunities and support to become a low-carbon business.

It is being run as two ‘in-person’ workshops held on campus at Manchester Met.

Dates: Wednesday 12 October 2022 & Wednesday 19 October 2022
Time: 10.00 to 16.00 (with lunch provided)
Location: The Salutation, 12 Higher Chatham Street, Manchester, M15 6ED (Part of Manchester Metropolitan University’s Campus).
Cost: For NW based SME’s the project is fully funded via ERDF.

What will be covered
During COP26 the UK Government announced plans for firms to show how they intend to hit net-zero. For those who have not engaged with the sustainability agenda before, or those who have looked at the scale of the challenge and wondered what they can do next to avoid the challenges of things like clean air bills and bans on red diesel fuel, this can feel like a daunting proposition.

On the 12th & 19th October, Manchester Metropolitan University are holding a two-day interactive workshop to help North West SMEs begin their sustainability journey through the development of long-term net-zero action plans, with a particular focus on innovation. The programme will cover: the basics of the climate emergency; understanding your business and its environmental impacts; identifying opportunities for innovation; and, how to develop pathways that can take businesses from current to next practice. Following the workshops, participating businesses will also have the opportunity to work closely with Manchester Met academics to implement innovations in their organisation through things like biofuels, hydrogen, 3D printing and more.

If you are interested in learning how your organisation can adapt to the threats and opportunities posed by the climate emergency and how it can not just survive, but thrive in a net-zero world, then you can register your interest and arrange an informal chat about the project, by completing the EOI form on the website ECO-I North West · Manchester Metropolitan University

First revision of Construction Playbook published

First revision of Construction Playbook published

The Cabinet Office has now published the first revision of the Construction Playbook.  The Playbook captures commercial best practices and specific sector reforms outlining the government’s expectations of how contracting authorities and suppliers, including the supply chain, should engage with each other.

These are set out in 14 key policies for how the government should assess, procure and deliver public works projects and programmes which all central government departments and their arms length bodies are expected to follow on a ‘comply or explain’ basis.

This is the culmination of 6 months work, which has involved people from across Whitehall and the construction sector, and to which BEIS has made a significant contribution, particularly in relation to the enhanced content in the Playbook and associated guidance on net zero carbon and environmental performance as a key component of a strategic approach to ensuring the sustainability of infrastructure and construction projects. The key points about the substance of these changes are:

  • a clearer statement that whole life carbon assessments should be undertaken for all HMG construction projects and programmes, and that these should be consistent with strategic organisational objectives for decarbonising estates and improving carbon performance;
  • further guidance on what action contracting authorities should be undertaking at each stage of the process for implementing these projects, from market engagement through to handover and operation, to deliver improved carbon outcomes, with an emphasis on benchmarking, monitoring and reporting these;
  • pointing contracting authorities to a much wider range of external resources (toolkits, advice and guidance, promoting the circular economy and contractual clauses – the CIH Value Toolkit is regularly referenced, and we also cite Construct Zero in the Guidance Note) to support their efforts and enable them to embed a more comprehensive approach;
  • incorporation of the need to address the provisions of the Environment Act 2021 (e.g. biodiversity net gain), and also emphasising the importance of wider considerations such as air and water quality; and
  • additional and comprehensive guidance on Net Zero and Sustainability, including a set of case studies of best practice. We highly recommend the Foleshill Health Centre one as an example of what can be achieved – but we have also managed to include case studies from HS2, the Environment Agency, and also the product platform developed through the TCC with CIH involvement.

Comment of the revised launch of the Construction Playbook FIS CEO, Iain McIlwee stated:

“The Construction Playbook sets its stall out in the first line – the focus is getting projects and programmes right from the start.  Nothing really is more important than this, as per our own research on procurment – the best form of dispute resolution is effective procurement in the first place.  It is imperitive as the biggest client of construction in the UK that Government is an exemplar client and that the principles outlined in here extend to the wider public sector procurement and into institutional investors.”

The revised version of the Construction Playbook, together with associated documents is available here.

Details of FIS Research into Procurement is available here.

 

Lens Blog: Getting paid

Lens Blog: Getting paid

The second in our series of short blogs by FIS Consultant, Len Bunton on contractual and commercial issues he experiences when supporting FIS members and the wider community – it is designed to help FIS Members avoid common traps and build on our focus on collective experience. 

My phone is ringing a lot just now with clients saying – “we need help as we are not getting paid.” Is that going to improve, and I would say no in the current market conditions. What business in the construction industry need to do is to become much more focused, and commercially smarter in dealing with the financial aspects of their projects.

So here are a few suggestions…

 

Members can see the full blog

Copies of energy management standard BSI ISO 50005 available for free to support SMEs

Copies of energy management standard BSI ISO 50005 available for free to support SMEs

Given the need to focus all efforts on reducing the cost of energy, SME’s are reminded that they can get a free copy of the standard BSI ISO 50005 on energy management.

The aim of the guide is to help SMEs with their decarbonisation journey, and BEIS in a practical gesture, has sponsored 100,000 free copies of the BS ISO 50005 standard which is targeted at SMEs to help them “to develop a practical, low cost-approach to energy management to reduce energy consumption, energy bills and greenhouse gas emissions”.

Energy management systems are systematic tools that support businesses in managing their energy usage.  The BS ISO 50005 standard is designed for SMEs through a phased/staged implementation approach to make it manageable for SMEs with small resource and capacity.

You can download your free copy here.

How to submit an employer application for a CSCS Card

How to submit an employer application for a CSCS Card

CSCS has updated its user guide for employers making applications on behalf of their workforce.  Designed to make applications quicker and easier, the new guidance is available to download for free and includes information on registering applicants, uploading employee qualifications and adding CITB Health, safety and environment test details.

The guidance also includes the following:

  • Lost and replacement cards
  • Signing into your account
  • Types of application
  • Card dispatch addresses
  • Useful hints and tips to save you time and effort

Download the new updated guidance free via the CSCS website.

Qualifying the workforce and apprenticeships

Qualifying the workforce and apprenticeships

Now pupils are heading back to school and those who left in June or July follow their post school dreams there is going to be a number of young people who are undecided, back into education, further education linked to an occupation, employment or an apprenticeship.  If you are looking to increase your workforce the pool of undecided could be an opportunity.

When you embark on the quest to recruit it is worth considering what qualification options there are available for your new employees.  FIS have 34 Training Provider members up and down the country offering training, qualifications and apprenticeships from the trades to senior management take a look at FIS Training Directory for a fellow member in your area, some of these training organisations operate nationally and will deliver the necessary training onsite.

Vocational qualifications are the main stay of the sector but are more suited to experienced workers unless preceded by a formal training programme leading to a recognised national qualification, as they are in the apprenticeship frameworks for Scotland and Wales.  Individuals learn the skills and knowledge in a training environment and apply these in the workplace to develop the appropriate attitude and gain experience.

For apprenticeships in England FIS members deliver training for the following trade options:

  • Plasterer
    • Option 1 – Solid
    • Option 2 – Fibrous
  • Interior Systems installer
    • Option 1 – Dryliner
    • Option 2 – Ceilings and Partitions Installer

Take a look and download a copy of the FIS Apprentice – Guidance for Employers.  If you need any assistance to source training or qualifications call FIS on 0121 707 0077 or email info@thefis.org.

Apprenticeships explained

Apprenticeships explained

A great way to launch a career in the sector is by one of the many Apprenticeships on offer.  Age is not a restriction for career changers and there are opportunities to upskill in various occupations.  There are more than 640 apprenticeships approved in England by employers, meaning someone could pursue a career in anything from Dryliner to Contracts Manager.  The National Apprenticeship Service has some great advice for employers including clear information on costs.  Take a look at the FIS Apprentice – Guidance for Employers and if you need information, advice or guidance call FIS on 0121 707 0077 or email info@thefis.org

Transfer and Receive Apprenticeship Levy

Employers in England that pay the apprenticeship levy can transfer their unused apprenticeship funds to help other organisations pay for apprenticeship training.  The employer that receives the funds can only use them to pay for apprenticeship training and assessment.  You can transfer up to 25% of your apprenticeship funds.

Prior to sign up you will need an apprenticeship service account

Create an account to manage apprenticeships – Manage apprentices (manage-apprenticeships.service.gov.uk)

Transferring your apprenticeship levy to another business – GOV.UK (www.gov.uk)

An apprenticeship levy paying employer can transfer up to 25% of their annual levy funds to another employer to pay for the training and assessment costs for apprenticeship standards.  Transfers can support new apprenticeship starts, this includes existing staff starting an apprenticeship or where the apprentice’s employer has changed.  Transfers may be used to support the skills gaps and shortages within locations or sectors.

Receive a levy transfer from another business to fund an apprenticeship – GOV.UK (www.gov.uk)

Transfers is one way of receiving funding to support the costs of apprenticeship training and assessment.  By receiving a transfer, if you do not pay the levy then you will save the 5% employer co-investment.  Also, transfers do not count towards reservation of funds.  Apprenticeships are not just for new employees; they are available to upskill existing employees too.

If you need assistance to transfer, pledge or secure apprenticeship funds for taking on an apprentice give FIS a call on 0121 707 0077 or email info@thefis.org

Technical guidance note on BS EN 13964: The language of Suspended Ceilings

Technical guidance note on BS EN 13964: The language of Suspended Ceilings

FIS has produced guidance that is designed to support and enable better understanding and engagement with BS EN 13964.

The guidance note aims to break down the standard into bite sized sections making it easier to understand to those who aren’t already familiar, allowing anyone to isolate only the sections that are relevant or of interest and gain either a passing understanding or to establish the necessity of purchasing the full standard. Where appropriate, each section covered will also give relevant commentary on reasonable expectations of products in the marketplace today.

Whilst the guidance is not designed to replace the standard and should not be relied upon to relay comprehensive detail and listings, it will prove useful to anyone who is not sure if the standard applies to certain products, are using the standard for specification purposes or simply wish to understand more about the reasonable expectations of performance requirements of a suspended ceiling.

FIS has previously published a comprehensive Specifiers Guide to Ceilings and Acoustic Absorbers that references BS EN 13964, but gives specification advice based on all common ceiling types and associated market expectations of performance and tolerances etc so the advice is not constrained to only those types of ceilings covered by the standard.

Referenced and associated FIS publications:

Specifiers guide: Ceilings and acoustic absorbers

FIS Best practice guide: Selection and installation of top fixings for suspended ceilings

FIS Best practice guide: Installation of suspended ceilings

FIS Best practice guide: Maintenance and access into suspended ceilings

FIS Site guide: Suspended ceilings

FIS Technical note: Transition trims

The unintentional designer

For further information or for any questions please contact FIS at info@thefis.org or call 0121 707 0077.

Building Safety consultations

Building Safety consultations

The Setting the Bar report outlines a system of competence standards for all those working on higher‐risk buildings, and two of the Working Groups responsible for reviewing specific sectors have now published proposed standards for comment:

  • Working Group 9 is consulting on the Framework for competence of Site Supervisors in England which covers individuals working under the supervision of a Principal Contractor and those supervising workers on a day‐to‐day basis. This will be of interest to those fulfilling the role of Site Supervisor, as well as those that delegate to, employ or train Site Supervisors. Comments should be submitted to the CIOB by Friday 30 September.
  • Working Group 7 is consulting on the Framework for competence of Designers in England which covers organisations or individuals that prepare or modify designs for projects, as well as those that arrange for or instruct others to do so. This will be of interest to anyone fulfilling the role of a Designer, for example architects, engineers, surveyors, contractors, specialists, manufacturers and suppliers. Comments should be submitted to the RICS by Wednesday 5 October.

DLUHC is also consulting on the changes that will be made to Building Regulations to implement the new building safety regime. There are 12 different sections to the consultation, including dutyholder roles, gateways, change control process and more rigorous enforcement powers. Comments can be submitted online or via email by Wednesday 12 October.

Outstanding area of concern not resolved by the UK-EU Trade and Cooperation Agreement

Outstanding area of concern not resolved by the UK-EU Trade and Cooperation Agreement

The CPA Techincal and Regulatory team have updated the latest paper regarding areas of concern on the UK-EU Trade and Cooperation Agreement. This is set as a result of the post-Brexit UK-EU Trade Deal, particularly around the transition from CE Marking to CA Marking. To read more on the subject, you can access the paper here.

FIS CEO Iain McIlwee stated:

This is worrying long list given the time available.  We need to be having conversations with the supply chain and checking our contracts to ensure that we are not going to get landed with liquidated damages because availability of a product or component becomes an issue.  We continue to ask members to come forward with any specific problems that they face and to work with the CPA, CLC, Civil Service and our political masters to ensure that we don’t leave construction in the lurch because of practical problems resulting from political indecision and resource”.

Cost pressures dominate a mixed quarter

Cost pressures dominate a mixed quarter

There were signs that the extended period of growth experienced by the construction supply chain began to ease in the second quarter of 2022, with cost inflation dominating the headlines of industry surveys. Whilst net balances for construction product manufacturers’ sales and SME contractors’ workloads continued to show growth, they were the lowest since 2020 Q4 and were accompanied by product manufacturers anticipating a fall in sales over the next 12 months and SMEs reporting that enquiries slowed significantly from recent quarters, including falls for new house building and the industrial and commercial sectors

Access the full report here

Members can access the full report, produced by the Construction Products Association.

FIS strengthens contractual support in troubling times

FIS strengthens contractual support in troubling times

In the last few weeks FIS has seen an increase in requests from members related to contractual matters, some that are reaching a critical point.

The range of requests for support have included delayed payments, price fluctuations and misalignment in pricing of variation as well as concerns over design liability and transfer through contracts.  As inflation and delays continue to erode margin, such issues are seem set to become more commonplace – whilst the industry talks about transformation, there is a danger we are becoming more contractual.

To support members in a challenging time, FIS is delighted to announce a new consultancy arrangement with Bunton Consulting Partnership.  This partnership will enable FIS to extend support for members experiencing commercial and contractual issues, by referring them to a highly experienced Industry Consultant, Len Bunton FRICS FCIArb Hon FRIAS (further details below).  Len will provide an initial free consultation of 1 hour to discuss and review the specific issues faced and to help develop a strategy to address.  Should further advice and support be necessary, thereafter then Len will agree the necessary fee levels with each FIS member.

Commenting on the introduction of this new service, FIS CEO Iain McIlwee stated:

“This partnership further strengthens the support FIS provides to its members in managing contractual concerns.  Sadly we still operate a contractual structure that often encourages adversarial behaviours – we even call ourselves contractors rather than constructors and the result is we spend as a sector 1.9% of turnover, almost double that of any other industry, on legal disputes.  The cost to the bottom line is crazy, the cost to lives and wellbeing morally reprehensible.  At FIS we are focussing on procurement as a key lever for change, but we are very conscious we are where we are and it has never been more important for members to review their contractual positions and make sure they understand and can quantify risks.  We have seen an uptick in administrations in recent months and there is a fear that the industry is entering survival mode.  This is when we are tempted to resort to the worst possible behaviours.  We are grateful to Len for stepping up to provide additional help in these challenging times – his work on the Conflict Avoidance Pledge and advocating this approach makes him a perfect partner for FIS.”

As part of the new relationship Len Bunton made the following comment:

“I have dedicated my career to conflict avoidance and this for me starts before the contract is even signed – it is all about getting off on the right foot.  You need to enter contracts with your eyes open to the risks and reinforce to everyone involved in the project that paperwork is everything and that any instruction must be documented and confirmed in writing at the time.

The clearer the information, the less ambiguity which means less scope for misunderstanding and reduced opportunity to debate and delay.  It is also critical to make sure all are aware of contractual deadlines and any how any deviation from programme or variation in price needs to be reported.  Doing all of this won’t guarantee the avoidance of all disputes, but they will see many off before they start and allow for speedier resolution and ensure that you are in the best possible position should you need to rely on third party intervention. I am looking forward to working with FIS Members to resolve existing issues, but also offer the advice and support that will help them avoid the next one too.”

With Len, FIS is actively encouraging members and the wider construction community to look at Conflict Avoidance Pledge (CAP), based on the simple concept – the cheapest way to manage any dispute is not to have it at all.  The CAP is a contractual mechanism, which helps parties to avoid getting embroiled in pro-longed and damaging disputes. Where disagreements begin to develop, CAP enables parties to address and resolve matters early, collaboratively and inexpensively.  The process recommends standard clauses that you can include in your contract.

Further information about Bunton Consulting Partnership is available below:

Len Bunton FRICS FCIArb Hon  FRIAS – has over 40 years’ experience as a cost consultant and, adjudicator, arbitrator, mediator, expert witness and conflict avoidance consultant. He has extensive experience on major projects.  Len is Vice Chair of the Conflict Avoidance Process Coalition and is absolutely committed to the Conflict Avoidance Process.

Bunton Consulting Partnership, 2 Ardoch Way, BRACO, Perthshire, FK15 9RH | Also at Princes Exchange, Princes Square, LEEDS, LS1 4HY | E: len@buntonconsulting.co.uk

 

This service compliments the existing FIS Legal and Helpline and Contractual Support and can be accessed by calling the FIS office on 0121 707 0077.

 

For the full range of supporting advice and information available to members you can visit the FIS Contractual Commercial and Legal Toolkit here.

 

Exam Results 2022 – getting the message out that an amazing career awaits in construction

Exam Results 2022 – getting the message out that an amazing career awaits in construction

Approaching 700,000 of students collected exam results today (18 August).  This included A and AS levels, level 3 vocational and technical qualifications as well as the new T’Levels – so far over 425,000 of these students have been confirmed places at University, but many others will be considering what next.

A collective effort to promoting careers in the finishes and interiors sector
Now is a vital time for employers to step up and get the message out there that the £10 billion Finishes and Interiors Sector, a sector that employs around 280,000 people is a dynamic part of construction and offers a range of opportunities.  This is our opportunity to champion that we are a credible choice, that we create the interior spaces and carry out the finishing that turns a structure into a home, hospital, cinema, hotel or school, basically we put the wow into buildings.   We need to make sure that those looking to step into the world of work know that there are opportunities to train for a trade in as an Interior Installer, Plasterer, Dryliner, Carpenter and Joiner, Ceiling Fixer etc.  We also need Designers, Building Information Modellers, Surveyors, Contract Supervisors and Project Managers as well as all the other array of roles that support the construction process, from IT through to commercial.

A new opportunity through T-Levels
One group to highlight is that 1,029 students received their T-Level results with 207 of these being in “Design, Surveying and Planning for Construction”.   This is the first batch of T-Level graduates who have completed the new 2-year courses.  These qualifications are taken after GCSEs and are broadly equivalent to 3 A Levels, but offer a more sectoral and vocational focus.  The qualification combines study with a substantial industry placement so that students gain the skills and valuable workplace experience they need to progress into a job, further study or an apprenticeship.

What should employers do
Every great career starts with a job!  FIS is recommending all members use the TalentView Construction service to promote any opportunities and jobs available through your business.  As well as providing a free job board that is being heavily promoted to school leavers, this service automatically links with the National Apprenticeship Service and ensures that young people have the best possible chance of seeing your vacancy through any career advice that they receive.  Consider also making contact with your local college or sixth forms to ensure that they know of any vacancies that you have available that could be communicated to prospective candidates and also reach out to your local Department of Work and Pensions and ensure that all of the local support is being utilised.

So whether you are looking to hunt down a T-Level graduate or are keen to take on a recent school or college lever on as a trainee, apprentice or even offer to sponsor a candidate through their degree there are a range of tools that FIS and others have made available to support a collective effort that helps to present more consistently a dynamic sector full of opportunities.

For top tips and support in promoting careers in the sector visit the Recruitment and Induction section on our website that includes links to useful resources or contact the FIS via telephone 0121 707 0077 or email info@thefis.org.

Targeting school leavers in 2023 and beyond
Effectively targeting the 700,000 annual school leavers and inspiring young people to think about a career in construction is critical.  To support you in this work the STEM Construction and Built Environment Ambassador programme provides vital training, tools and support, giving you confidence that the message is right and we are working (and learning) consistently as a sector.  Becoming an ambassador will also plug you in to the STEM network and will open up opportunities to visit schools and careers fairs.

Ambassadors play an essential role in inspiring young people to think about a career in construction through a range of activities, these include school presentations, careers talks and mentoring.  If you are interested in becoming a STEM Construction and Built Environment Ambassador, you can find out more by joining our webinar, register here .  Remember you are not alone and we are here to help.  At FIS we have members of our team who have completed the training and are actively working as ambassadors, we are maintaining a network of ambassadors and are using this network to better understand how to target our approach and to develop resources.  More on construction ambassadors here

If you are interested in offering T-Level industrial placement in 2022/2023 please email info@thefis.org and we will make the necessary introductions.

English apprenticeships off the job training policy has changed

English apprenticeships off the job training policy has changed

From 1 August 2022, the 20% off-the-job requirement for all apprenticeships will no longer apply.  It will be replaced by a baseline of six hours per week, irrespective of hours worked by the apprentice.  It means apprentices who work more than 30 hours per week can now spend less than 20% of their time doing off-the-job training.  The Education and Skills Funding Agency (ESFA) has stated that this move, part of a package of changes to apprenticeships, ‘must not dilute the existing requirement, but provide the right level of training to every apprentice’.  This shouldn’t be a problem for the training providers and employers.  Employers have control over the training provided in the workplace.

It is an eminently sensible rule change and it should lead to a rise in apprenticeship numbers for these three reasons:

  • Apprentices will be able to contribute more at a time when many businesses are still struggling to recover from the impact of the pandemic.
  • It levels the playing field, meaning all apprentices will be required to engage in the same number of off the job hours, and are not penalised whether they work 30 hours a week, or 48 hours a week.
  • It will be much more easily administered without the need for complex and varied calculations which have been an administrative burden for Training Providers

This now aligns to an academic training day of six hours rather than the working day of 7.5 hours, allowing Training Providers to standardise and create learning programmes for cohorts rather than individuals. It is advisable to create a working relationship with your Training Provider to ensure you know what subjects the apprentices will be covering when they are with the them.  This does not remove the employers responsibility for training apprentices in the workplace and giving them time to practice the skills they learn in training in the workplace.  If you need more information contact George on 07553 874838 or email georgeswann@thefis.org

Need help with apprenticeships?

More information is available in our Skills Hub

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Billions in unspent apprenticeship levy lost to Treasury ‘black hole’ new data reveals

Billions in unspent apprenticeship levy lost to Treasury ‘black hole’ new data reveals

Apprenticeships experts warn that the Treasury must be more transparent on how it spends the billions returned to its coffers.  The rigid apprenticeship system is blamed for billions of skills funding going unspent by businesses and being returned to the Treasury.  More than £3.3 billion has returned to the Treasury in the last three years under the Government’s use-it-or-lose-it apprenticeship levy rules, according to new data collected by apprenticeships experts the London Progression Collaboration (LPC).

The LPC, which to date has helped transfer £10 million of unspent apprenticeship levy from large employers to support small businesses and create over 1,000 apprenticeships, says that it is not clear how the Treasury is making use of the £3.3 billion that it has received from businesses.  The apprenticeship experts warn that this lack of transparency means it is unclear whether the Treasury is using the unspent levy in a way that best supports the places most in need of levelling up, and whether it is helping create more entry-level apprenticeships, after numbers have plummeted in recent years.

The LPC argues that if the apprenticeship levy is to meet its objective of increasing employer investment in training, the Treasury needs to give employers greater control over how their funds are directed, including by increasing the 25 per cent apprenticeship levy transfer cap.  The LPC has seen at first hand the challenges the current system poses to businesses in their work helping firms navigate the complex apprenticeship system and transferring their unspent levy to small businesses.

These findings follow previous research by the LPC which shows that since 2014-15, ‘entry-level’ apprenticeships have fallen by 72 per cent in England, while apprenticeship starts amongst under-19s have fallen by 59 per cent, depriving those most at risk of in-work poverty and at the beginning of their careers the best start in life.

Commenting on this information, FIS CEO, Iain McIlwee stated:

“We need clarity here, Government increasingly expects employers to act as finishing schools, but is simply not providing adequate support for the investment that this entails.  We need a serious rethink about how education is built around careers and preparing people for the world of work, not purely academic outcomes.  The chasm between education and industry seems to be widening and the answer is not more stealth tax!”

Source IPPR

Tickets are now on sale for Training Awards Lunch

Tickets are now on sale for Training Awards Lunch

The awards are a joint event between the Worshipful Company of Plaisterers and FIS to recognise achievement and excellence in plastering and interior trades. The event will be held at Plaisterers’ Hall on 22 November and will celebrate the achievements of students and apprentices in our sector, as well as organisations and individuals that champion skills and training for the benefit of our industry. It will also provide networking occasion for like-minded individuals to come together. You can book your seats here.

If you haven’t yet entered the awards, there’s still time to nominate. The awards recognise:

  • The achievement of apprentices
  • Students who have exceeded beyond expectations
  • The delivery of training by colleges and training providers
  • Training delivery by an FIS member company
  • Mentors and others who have supported sector training
  • Lifetime contribution to sector training

If there is an indivdual or business you’d like to nominate, you can find out more details on how to enter here.