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7.28 pm

The Parliamentary Under-Secretary of State for Education and Employment (Mr. Malcolm Wicks): I am grateful to my hon. Friend the Member for Battersea (Mr. Linton) for raising this important issue. I commend him for drawing the attention of the House to his serious concern on behalf of his constituent. He works hard for the people of Battersea--this is an example of that.

I am also aware that he is a strong supporter of training and of the CITB, which is a statutory training board. As he mentioned, it is one of only two that remain. It is a large training business whose role is to ensure that there is a skilled work force able to meet the needs of the industry it serves.

My hon. Friend raised several complex issues. They are not easy to resolve without creating other difficulties--he anticipated my argument on that point. It is important to keep in mind the wider benefits for the whole industry of the training board and the levy.

I shall set out the general context of the work of the CITB, before dealing with the particular concerns expressed by my hon. Friend. The board is regularly reviewed--most recently in 1997--and exists only because the industry wants it. The board is not an unwelcome imposition by Government. Employers, with the support of the trade unions, have consistently made a strong case that a mechanism for collective funding is necessary to train a national pool of highly skilled workers. They are clear that there would otherwise be a reduction in the total amount of training. That is because of the special circumstances of the industry, with its mobile work force, employment often on a project-by-project basis and the significant use of labour-only sub-contractors.

In such circumstances, the levy and training grant mechanisms spread training costs across those who train and those who do not train. Everyone contributes whether or not they are willing to train and all, ultimately, benefit in that trained labour is available to the whole industry. That describes the general position.

The benefits go far beyond the return of levy paid in the form of grants to those employers who train the industry's future work force. The levy also provides for the development of occupational standards, especially on health and safety which is critical. Furthermore, provides for the development of qualifications, the availability of export training advisers and for work with schools on careers advice and with the further education sector on improving course quality and on research on skills forecasting. All that activity and more is to the

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competitive benefit of the companies within the scope of the training board. As my hon. Friend will appreciate, that includes those companies that decide to use the training board's services or to train and claim a direct grant for whatever reason. Nevertheless, they still benefit substantially from the work of the board.

Specifically, for firms engaged in floor covering, the CITB has developed national vocational qualifications and standards at levels 1, 2 and 3. They cover the full range of skills, including laying hard coverings. Grants are available to contribute towards the cost of achieving those qualifications. Floor covering training is delivered at three locations--in Kent, Salford and Glasgow. Again, funding is available from CITB for training costs and, if necessary, for travel and lodging expenses. If companies prefer to train themselves, there is help for that through the board's on-site assessment and training scheme. The Contract Flooring Association is involved in arrangements to make it easier for flooring companies to use that scheme. Many opportunities are in place for such companies to develop their training arrangements.

To ensure a level playing field between companies, demands have been made in recent months for there to be a law that would make it mandatory for every construction company to register with the CITB. The CITB is considering making such a proposal, and I have said that I will consider a change in primary legislation. However, a convincing case will need to be made. It will need to take full account of the costs and benefits and give full consideration to the administrative and bureaucratic implications. Whether a company is in scope to the levy can be a fairly complex decision, and that was the burden of my hon. Friend's remarks.

For example, it might surprise the House that plumbers, electricians and fence erectors are out of scope while bricklayers, carpenters and painters are in scope. I am not sure that we could reasonably expect companies to make that decision, and how do we wish to penalise them if they make the wrong one?

At present, it is the board's responsibility to identify and register firms. I know that it does that vigorously and will always follow up information given to it. The CITB is successful in improving levy collection--last year, it collected an extra £10 million.

My hon. Friend was concerned that firms whose main activity is not floor covering but which, nevertheless, do significant amounts of that work are not liable to the levy and he pointed out that that gives rise to anomalies. I have some sympathy with the point, but I cannot see a better way of identifying construction companies without creating further anomalies. To levy all firms that undertake any construction activity, no matter how small, would be very hard to implement. Where would the line be drawn--at 25, 30, 40 per cent. of a company's work load being a construction activity? It is a difficult question and he will understand the problems surrounding that. The ClTB's approach of more than half seems, on balance, to be right.

I understand the point about the so-called "jagged edge" caused by different types of floor covering, only some of which are within the scope of the levy. It adds strength to the argument if one draws a comparison between the jagged edges that customers do not want to see and those that are apparent in this area of public policy. My hon. Friend's point was well made.

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Until 1992, all floor-covering activity was potentially in the scope of the CITB, but an industrial tribunal took the view that carpet and carpet tiles are furnishings and therefore do not fall under the relevant statutory definition of construction. The CITB has operated on that basis since that decision.

That brings me to my conclusion and the way forward. As far as I know, there is no groundswell of opinion that we should revert to the pre-1992 position by bringing carpet laying back within the scope of the levy or, on the other hand, that we should remove hard floor covering from its scope. We do not know how many companies are affected, but there are about 200 that declare themselves to CITB as being mainly engaged in floor covering. It is for them, with their trade association, to make the case for change one way or the other based on a judgment of how best to ensure that quality training continues at least at the present levels.

I listened carefully to my hon. Friend and I shall re-examine his arguments in Hansard tomorrow. Obviously, the CITB can consider representations. I

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assure my hon. Friend and his constituent that I shall discuss this very case with the CITB at our next meeting. My hon. Friend made his argument powerfully, and given the way in which he described what is clearly a small but successful business, I understand his points about margins and competition.

I conclude by underlining the main issue: it is about ensuring that effective arrangements are in place to provide a high-quality work force for the construction industry, including the floor covering sector. At the very time when we need to improve both the quantity and quality of training in our country, we do not want to do anything that would undermine our chances of achieving that objective.

I should be happy to have a follow-up meeting with my hon. Friend to discuss the matter further and I congratulate him on bringing to the attention of the House a matter that is, for some, obscure, but for those of us who understand it, very important.

Question put and agreed to.



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