A review of the case of a Levy-Grant Scheme (LGS) in the UK construction industry

A Levy‐Grant Scheme (LGS) has existed in the UK construction industry since 1964 to provide financial support for companies undertaking training activities. Despite the support of the LGS for various training activities, notably apprenticeships, the construction industry continues to suffer from both labour shortages and an under‐investment in training activity when compared to other sectors in the economy. This situation raises the question as to whether a LGS is an effective means for supporting training activity. This paper thus presents an in‐depth review of the case for and against a UK construction LGS. It is argued that the LGS on its own is insufficient to alleviate labour shortages and poor participation levels in training. Moreover, if the LGS is to continue enjoying the support of employers it is important that levy payers (in particular) see the value of the scheme as integral to their business activities and do not regard it as a mere tax. The demonstration of the real value of the LGS becomes imperative when considering the current economic climate where companies are working with tighter budgets.