After extensive consultation, the Board introduced a package of measures to restore working capital for the skills board and ratified proposals that had been tabled by industry-led committees and agreed to:
· Reduce the Training Plan day rate to £17.50 (applicable to all plans started during the 2009/2010 Scheme Year).
· Increase the minimum duration of training acceptable within a Training Plan from 30 minutes to three hours (applicable to all plans started on or after 1 January 2010).
· Limit entitlement to the Training and Development Plan per capita grant (£9 per head with a minimum of £450 payable) to the first Training Plan only (effective for plans started on or after 1 January 2010).
· Reduce grants by 15%. However, the Board wanted to learn lessons from past recessions and limit the potential for skills gap from emerging in the future. As a result, they opted to protect grants for new entrants coming into the industry at all levels – from professionals to trade.
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The move came after leading economists reported that the construction industry has contracted by 13% this year. This, combined with falling Levy, a continuing high demand for grants and a drive for efficiency within the organisation has resulted in further changes being made.
The Board has been advised by its employer-led Training and Finance Committees to take necessary measures to ensure that funding can continue to be provided to help businesses, despite the slow recovery in the economy.
Since the recession started to bite in August last year, employers have defied gloomy economic forecasts, and learnt lessons from the last recession, by continuing to train, so that they are ready for the economic recovery when it happens.
In 2008, 23,500 employers claimed grants of £176m to support business training and qualifications, which was good news for the industry. However, this was £20m more than forecast. Despite steps to make the Grants Scheme more affordable this year, employer demand has exceeded forecasts by a further £4m, leaving the industry led committees no alternative but to seek approval for a further and final round of changes.
Chris Jones, Learning and Development Director at BAM Construct UK Ltd, Chairman of the industry-led Grants Scheme Working Party and member of the Training Committee said: "Whilst the changes that the Board have made today are not popular decisions, they are necessary to the long term survival of the Grants Scheme, if we want to guarantee funding for business critical training and create a financially sustainable Grants Scheme going forward.
"In an ideal world, we wouldn’t reduce grant rates, but these are difficult times. This has been another very tough decision – regrettable but essential in the current climate."
(GK/KMcA)
