CITB Update: What was the point of the Morrell Review?

The long-awaited Morrell Review was finally published on 6^th November. My verdict? It’s nothing more than a dud firework.

Morrell, who was the Government’s first Chief Construction Industry Adviser, was tasked with leading a review of industrial training boards, with a particular emphasis on the future of the Construction Industry Training Board (CITB).

But anyone actively involved in attempting to influence CITB reform, or monitoring the CITB’s life-or-death consensus process – and that includes Hudson Contract – must now be left with the feeling that the Review was out of date even before the proverbial ink was dry.

Which is to say that suggesting reforms after the CITB has set out its three-year plan and made a string of promises to industry seems pointless.

The reality is that Morrell’s Review seems to justify the Government’s failure to step in to deal with what most in the industry feel is a bloated quango, long past its sell-by date.

For example, the report talks about the CITB being more transparent. Yet the CITB is already heading in the opposite direction. Changes in their 2016 accounts mean the money they spend on activities such as ‘running the business’ will no longer be visible.

Directly addressing the recommendations stated in the Review, the CITB instantly committed to solve its lack of relevance with SMEs simply by appointing someone from an SME background to the CITB board.  But at the same time they say greater influence will be exerted by the Construction Leadership Council, which consists of major contractors . . .

I was also amused by the Review’s suggestion that activities out of the CITB’s jurisdiction, such as plumbing, electrics, and insulation, ‘may wish to come into scope to benefit from the grant system’.   Whilst elsewhere – and here’s another corker! – it declares employers should not focus on grants, but should instead be happy their levy is paid to provide ‘outcomes for the industry’.

When it comes to the government’s new Apprenticeship Levy, the position seems to have changed.

You might remember that when Education Minister Anne Milton pre-empted the outcome of the Review earlier this year by declaring her support for the CITB, she said both levies had to stand alone and demonstrate their value to payers.

However, the Review concludes that the CITB, funded by its own separate levy, should now complement the Apprenticeship Levy. This looks to me like retrospective approval of the CITB’s decision to introduce a £41m cashback scheme to compensate for the Apprenticeship Levy that’s paid by major contractors.

Important feedback ignored

The most disappointing part of the Review is the fact that four hundred and forty-nine levy payers made the effort to reply to the Government’s Call For Evidence, yet their important feedback has been ignored.

Whilst the Review acknowledges that the majority of employers wanted to scrap the levy and did not feel the CITB supported the industry, it goes on to say the number of those responding was ‘too low’ to be taken as being representative of the industry. Given the way the consultation was advertised and the time it was open, four hundred and forty-nine was an incredibly high response.

The views expressed by the trade unions and trade federations, who support the levy, were not surprisingly opposite to the views of levy-paying employers.  I suppose it’s a case of ‘those who pay in’ versus ‘those who take out’, and it demonstrates just how out-of-touch the federations are with the ever-decreasing number of firms who choose to pay their membership fees.

And so it goes on

Ultimately the Review is disappointingly predictable and does little more than add yet more complexity to a system that most already find unfathomable. However, the CITB is yet to have its levy order signed, so it’s not over quite yet.

Assuming though that the CITB does get final sign-off and is granted three more years of levy-raising power, we at Hudson Contract intend to hold both the Government and the CITB to account for the promises of reform contained in this Review, and will help our clients to air their views when the consensus process cranks up all over again, in 2020.