Who are CITB?
The Construction Industry Training Board is quite a mouthful, so you can see why it’s commonly abbreviated to CITB. CITB are responsible for the CITB grants that we commonly mention to support tradespeople train and upskilling in the trade sectors.
Training is essential to both our industry and the economy, but the problem we often see here in the UK is a lower productivity rate compared to many other countries. It’s why the government is pushing their message for an increase in productivity. It’s worth noting that the construction industry has one of the lowest productivity rates compared to other UK sectors. The government wants higher-earning self-employed people and PAYE people in this sector to help create happier workers and, of course, more tax revenue.
The biggest earners
Previously there were several “training boards” for a number of industries. However, the government has disbanded most training boards over the years, leaving only the construction and engineering boards. This is because the construction industry will soon be worth around £236 billion by the end of 2024. Making it one of the UK’s most significant growth sectors and a key driver for the economy, ahead of hospitals, banks, insurance and pharmaceutical industries.
The construction industry is also a massive employer within the UK, employing nearly 10% of the entire workforce. It’s why with the large workforce and its importance to the economy, the government classed all construction workers as key workers during the pandemic.
The construction industry
The structure of the construction industry is unusual compared to other sectors. 80% of the industry comprises of self-employed or small business owners with little or no employees. We understand that those 80% need to retain as much income as possible, restricting themselves or any of their workforce from taking training courses. The larger companies do some training but not enough to keep fresh blood coming into construction.
How do CITB work?
To combat this, the government has a system of levies for the construction industry linked to their CITB grants. It works by making companies who have taken a grant pay a levy. The amount of levy they pay is a percentage of their annual wage bill over a certain amount. Most decorating businesses never reach it. So, where a massive multimillion pound business pays into CITB through this levy, smaller companies like yours never reach the threshold. I will pick up on the subject a little more at the end of the blog.
CITB are a bit like the Robin Hood of training, taking money from the rich and giving it to the poor; in this case, the most profitable businesses are giving it to those smaller companies to train their staff. The large companies benefit in the long run because the system gives them a pool of trained people to recruit from or supply to.
What is the CITB funding?
When people talk about CITB funding, they often understand what it can do differently. Over the years, we at Painttech Training Academy have worked with employers who use the apprenticeship funding to claim money for their apprenticeship training but are entirely unaware of the CITB grants to help train their entire workforce. We have also had employers claim CITB grants for their workforce but are unaware of the apprentice funding.
To keep it simple, I will cover the two primary funding sources available to the construction industry.
The first one is the “Skills and Training Fund”. Money that is available every year for your workforce to do short courses in various things. The fund is in 4 bands.
– Employers registered for CIS can claim up to £2,500 for training every year.
– If you have between 1 and 49 employees, you can claim up to £5,000 yearly.
– Larger employers with between 50 and 74 employees can claim £7,500 yearly.
– If you have between 75 and 99 employees, you can claim up to £10,000 yearly.
Regardless of your category, the CITB grant will be enough to take a Painttech Training Academy course.
How to apply?
To apply, you fill in a simple form that lists the courses that you want to do. The CITB have a number of approved short courses that have a code attached to them; use this code on the form. We can give you those codes if you’re struggling to find any Painttech Training Academy codes; you don’t need to worry about it.
The other primary funding source is for apprentices. Apprentices are the lifeblood of the construction industry, and the apprenticeship CITB grants are one of the most common ways people get trained. The CITB have a large pot of money for any construction employer who takes on an apprentice. This money can also be used to subsidise the apprentice’s wages. Please speak to us to find out more.
Apprenticeship CITB grants consist of 2 parts. Part one of the funding is for attending college and doing a course; the second instalment is given upon passing. The second part is given to the employer at the end. The total amount available tends to go up each year but is currently over £11,000 per apprentice.
You can claim both the apprenticeship CITB grant if you have an apprentice and the skills and training fund CITB grant. Many companies are not aware of this.
Who do they support?
CITB is set up to support the construction industry, so you need to work in construction to claim any money. If you are, for example, a car sprayer, you will not be eligible. If you are an ex-car sprayer who has set up as a decorator, then you would be suitable.
CITB has a name for people eligible for funding; they call it being ‘in scope’; examples of trades in scope are bricklayers, joiners, plasterers and decorators. All the traditional “biblical trades”. Electricians and plumbers are not in scope and have their own funding sources. If a company mainly does building work but employs an electrician, it is still classed as ‘in scope’ as long as the building work is over 50% of what they do. An electrical company that employs a decorator would not be in scope.
Why do we support them?
I mentioned a bit about the support CITB give further back in this blog; however, it is worth revisiting this because many people don’t understand why they are given “free money”. But once someone applies for their funding and that funding gets it paid into their bank account, it suddenly becomes real.
The government wants your business to succeed, and they realise to do that, you and your staff require training. They want you to be more productive and make more money so they can receive more tax, and the grant pays for itself.
If you don’t feel an incentive to do the training, then in most cases, you usually won’t. But we’ve seen that once someone has done some form of training with us and they use that skill to make more money, they’re sold on the idea and then keep coming back for more and more training. So what CITB grants do is help you get past that initial hesitation by giving it to you for free.
The system benefits everyone with a CITB account, and once you start taking your CITB grants, you’ll see the benefits too.
What is the CITB levy?
In this closing part of this blog, I want to discuss the CITB Levy; we often get asked to explain it. The fear is that once you take a CITB grant, you will be landed with a massive bill year after year that will wipe out any benefit from the grant you have been given.
So let me be honest. Once you become part of CITB, everyone must fill in a “levy return” regardless of whether you pay a levy. In most cases, you will NOT pay anything.
The criterion for paying the levy is based on the wage bill. You do not pay anything if your wage bill is under £120,000 a year. That’s for people earning £30,000 each, and most decorators don’t reach it.
Suppose your wage bill is over £120,000; you only pay the levy on any amount above that. The levy is 0.05% of this amount. For example, if you have a wage bill of £160,000, this is £40,000 over the threshold. You would pay around £200 levy per year. This is a very small compared to the £5,000 you have been given in grant money.
If you want to know more about CITB Grants, head to our CITB information page and download our CITB guide. It’ll outline more of the benefits and how it can transform your business.
To speak to us further please find our details on our contact us page.