The ECITB’s levy proposals that received the overwhelming backing of industry in November, have been enacted into legislation following approval from both the House of Commons last week and House of Lords today.
The draft Industrial Training Levy (Engineering Construction Industry Training Board) Order 2026 was tabled by Minister of State (Department for Work and Pensions) the Rt Hon Sir Stephen Timms MP in the House of Commons on Monday 6 July.
The Rt Hon Baroness Smith of Malvern, the Minister for Skills, then led the Grand Committee debate in the House of Lords today.
Speaking in the Commons, Sir Timms said: “The industry faces big, longstanding challenges in recruiting and retaining a skilled workforce, which makes voluntary investment in training harder to secure. Only a statutory levy can guarantee that the skills that industry urgently needs will be provided at the scale required.
“It is estimated that the UK needs an additional 40,000 engineering construction workers, and this order will play an important part in supporting major infrastructure projects nationwide.
“In addition to industry support, the proposals before the House have received the full support of the devolved Governments of Scotland and Wales. They recognise, as we do, that the ability of the ECITB to raise and invest levy income is vital to ensuring that employers across all three nations can access the engineering construction skills that they need.
“What the debate has effectively underlined is just how important the work of the ECITB is.
“Approving this order provides continuity, stability and confidence for engineering construction employers across England, Scotland and Wales.”
Baroness Smith told the House of Lords Grand Committee debate: “The engineering construction industry is critical to the delivery of the government’s wider ambitions for economic growth, clean energy and energy security. It provides the skilled workforce needed to build, maintain and operate major energy and industrial infrastructure across Great Britain.
“Maintaining the ECITB’s ability to raise and invest levy income is vital to ensuring employers across all three nations can access the engineering construction skills that they need.
“An estimated £137.9 million will be raised in levy over 2026 to 2028, which will be invested in supporting the skills needs of the engineering construction industry. That investment will fund vital programmes to widen participation, raise skill levels, increase opportunity and to maintain occupational standards for the industry.
“The evidence is consistent that market forces alone will not deliver the pipeline of skilled workers the industry urgently needs to meet the demand for new major infrastructure projects. The ECITB’s levy is the mechanism that enables the collective benefits of a focused skills strategy for the engineering construction industry.
“It ensures that employers can access support for training and share the benefits of a skilled, competent and resilient workforce. And it also opens opportunity, helping apprentices and other new entrants to complete high quality training and existing workers to reskill or upskill to progress their careers.”
Andrew Hockey, CEO of the Engineering Construction Industry Training Board (ECITB), said: “The ECITB received the overwhelming backing of industry for its levy proposals last November with engineering construction companies voting resoundingly in favour of its proposed levy rates for the next three years.
“The subsequent consultation on the ITB Reform does not detract from the urgent need to attract, develop, qualify and retain skilled workers within the engineering construction industry (ECI) now.
“We will continue to support the industry priorities outlined in our new strategy and deliver against this industry-backed plan. Approval of the levy order gives us the financial underpinning to do this.
“Our new strategy sets out how the ECITB will rise to meet the challenges of an increasingly complex and fast-changing external environment and deliver positive, long-term outcomes for our levy payers, the wider workforce and the country.
“Our approach aligns with the UK Government’s mission-driven focus – particularly its goal to transition to clean power and stimulate sustainable economic growth in doing so.”
The ECITB launched the levy consultation following the publication of its new five-year strategy, Leading Industry Learning, in September 2025.
The high level of support for the proposals showed industry is fully behind the ECITB’s strategy to support employers in addressing skills shortages as well as investing in essential workplace training required to deliver the country’s net zero and energy security ambitions.
The Levy Order was affirmed by both Houses of Parliament, without opposition. The Statutory Instrument coming into force will be applied to levies raised in respect of 2026-28 and will be payable in 2027, 2028 and 2029 respectively.
The Order maintains the levy rates of 0.33% of the earnings paid by employers to off-site employees and 1.2% of the earnings paid by employers to on-site employees for businesses liable to pay the levy.
Recognising the budgetary pressures on small businesses, the Order retains the current exemption thresholds. Engineering construction employers with an annual wage bill of less than £1 million for off-site employees will not pay any levy.
Employers with an average wage bill of less than £275,000 for on-site employees will also be exempted from paying the levy. These employers will nevertheless continue to be eligible to receive training grants if they are in-scope to the ECITB.
The Government’s consultation on the principle of the CITB and ECITB forming a single body closed in June. The Department for Work and Pensions is now reviewing responses before submitting its recommendation to the Minister on the proposed reforms. The Government is expected to announce its decision this Autumn.
