CITB shaves £5m from apprenticeship clawback bill

A government-sponsored construction training body has negotiated a near-£5 million reduction in a huge clawback of apprenticeship funding.

The Construction Industry Training Board (CITB), which is funded through a levy on 67,000 employers, faced a liability of nearly £17 million from the Education and Skills Funding Agency (ESFA) due to “non-compliance” with funding rules between 2018 and 2021.

But the board’s annual report, published yesterday, said a “detailed investigation” into the ESFA’s audit meant it was able to “provide additional assurance and resolve potential errors” in its claims for apprenticeship levy funding.

This has lowered CITB’s likely overall liability to £12.3 million.

The report revealed poor record keeping meant the CITB was initially unable to evidence various funding claims.

It said: “We have taken steps to transform this part of the organisation, improving processes and introducing new technology, and are confident we will not experience similar issues for 2023-24 or future academic years.”

FE Week understands a large part of the apprenticeship levy clawback was due to high levels of sub-contracted training delivered through its branches of National Construction College, which it has now withdrawn. It has now settled £1.6 million of the clawback, a spokesperson confirmed.

CITB is an executive non-departmental public body for England, Scotland and Wales whose purpose is to “attract construction industry talent” and “support skills development”.

Last year it received £202 million in funding from a levy on construction employers of 0.35 per cent on payroll staff and 1.25 per cent on construction industry scheme subcontractors.

It spends the levy on grants for apprentices, qualifications and short-duration grants.

CITB’s board has been chaired by former ESFA chief executive Peter Lauener since 2018 – other members are senior representatives from large construction and property companies including Kier, Robertson Group and Keltbray.

An Ofsted visit last year resulted in its training centres’ grade dropping from ‘outstanding’ to ‘requires improvement’.

The watchdog’s latest report in June said CITB had made ‘significant progress’ in three out of four areas of concern by ensuring a significant proportion of apprentices caught up with their studies and improved their English and maths skills.

Since 2017 the number of apprentices on its books has fallen from 9,000 to about 400.

The report also reveals that CITB has “ceased to invest” in its ‘Training Model Improvement’ project because it “failed to deliver” on expectations.

The project was reportedly funded through a £1.5 million investment in Shared Services Connected Ltd (SSCL), a European technology consultancy giant that was co-owned by the Cabinet Office until late 2023.

CITB is attempting to recover costs through “formal contractual dispute proceedings” but the outcome “remains uncertain at this time”.

A spokesperson said: “Following extensive due diligence and close working with ESFA, the outcome of their audits of 2019-20 and 2020-21 Apprenticeship Levy provision has resulted in an agreed clawback against future apprenticeship levy claims of £12.3m.

“A significant proportion of this liability relates to subcontracted provision, from which CITB has withdrawn.

“We have since taken steps to transform apprenticeship delivery through the National Construction College, which is already having a positive impact on learners with retention rates increasing.

“We have also improved processes and we’re confident that we will not experience similar issues in future academic years.”