For discussion
FCR(97-98)112
on 27 March 1998

ITEM FOR FINANCE COMMITTEE

HEAD 176 - SUBVENTIONS : MISCELLANEOUS
New Capital Account Subhead "Grant to the Construction Industry Training Authority"

Members are invited to approve a one-off grant of $80 million to the Construction Industry Training Authority for providing additional training courses, intermediate trade tests and refresher/remedial courses for construction workers.

PROBLEM

We need to provide serving workers and job seekers with more training and intermediate trade tests to facilitate their successful placement and to ensure that there is an adequate supply of skilled labour to meet the demand arising from the housing and infrastructural development projects.

PROPOSAL

2. The Secretary for Education and Manpower proposes to make a one-off grant of $80 million to the Construction Industry Training Authority (CITA) for providing additional training courses, intermediate trade tests and refresher/remedial courses for local workersopportunities brought about by major construction programmes in the territory in the coming years.

JUSTIFICATION

3. The large number of housing and infrastructural development projects under planned for implementation in the next few years will significantly increase the demand for construction workers in the coming years. To ensure that those who are seeking jobs in the construction industry can take up fully and capably the opportunities in this area, we propose to provide CITA with a one-off grant of $80 million to enable it to expand its training and trade testing programmes. Details of the enhanced programmes are given in the following paragraphs.

Additional training courses

4. Based on existing manpower figures and a five-year projection of the demand for construction workers, CITA estimates that it will need to increase its annual training capacity of new recruits by 1 408 places in 1998-99 and 1999-2000. The additional training places are mainly provided in the form of short courses ranging from two to 23 weeks. They aim at providing unemployed persons with the necessary skill to join a particular trade in the construction industry.

5. The additional 1 408 training places will comprise 120 formwork carpenters, 90 joiners, 40 construction plant mechanics, 48 bar benders and fixers, 120 plant and equipment operators for earth-moving machinery, 270 concretors, 360 labourers for building projects and 360 labourers for civil engineering projects. Altogether they represent a 50% increase over the current level of training capacity in respect of short courses and will bring CITA's annual training capacity of new recruits to 6 288 places.

Intermediate trade tests

6. To set an objective standard for measuring skill levels, facilitate placement and safeguard the employment interests of local workers, CITA has started to provide intermediate trade tests to serving workers who wish to demonstrate their level of skill in a particular trade, as well as those who wish to enter the construction industry for the first time. Those who pass the test will have their names placed on a register to facilitate placement.

7. To meet the anticipated demand, CITA plans to offer a total of 10 080 intermediate trade test places each year in 1998-99 and 1999-2000 in 14 major trades of construction industry. They are plumbers, levellers, concretors, bar benders and fixers, marble workers, bamboo scaffolders, painters and decorators, bricklayers, plasterers, tilers, general welders, metal workers, formwork carpenters and joiners.

Refresher/remedial courses

8. CITA also plans to provide, free of charge, refresher/remedial courses of one-week durations to those who fail marginally in the intermediate trade test but want to make their second attempt. Depending on demand, it will provide up to 24 refresher/remedial courses a year for each of the 14 intermediate trade tests in 1998-99 and 1999-2000.

FINANCIAL IMPLICATIONS

9. The grant of $80 million will finance additional training courses, intermediate trade tests and refresher/remedial courses in 1998-99 and 1999-2000, and is made up as follows -

		$'000
(a)	Additional training courses	49,582
(b)	Intermediate trade tests	26,440
(c)	Refresher/remedial courses	3,912 _____
	Total	79,934
	Say	80,000 _____

A detailed breakdown of the expenditure is at the Enclosure.

10. Subject to Members' approval, we will provide the grant to CITA in 1997-98 through supplementary provision under delegated authority.

BACKGROUND INFORMATION

11. CITA was established in September 1975 under the Industrial Training (Construction Industry) Ordinance 1975. Its major functions are to establish and maintain industrial training centres, to provide training courses for the construction industry, to assist the placement of persons who have completed the training courses, and to make recommendations with respect to the rate of training levy.

12. CITA derives its income primarily from a levy collected under the Industrial Training (Construction Industry) Ordinance. The rate of levy is 0.25% on the value of construction works which exceeds $1 million. CITA plans to spend over $275 million in 1998 on training courses and related activities.

Education and Manpower Bureau
March 1998

Enclosure to FCR(97-98)112

	Item	1998-99 $'000	1999-2000 $'000	Total $'000
(a)	Additional training courses
	Equipment and machinery	14,650	-	14,650
	Setting up of training ground (a)	4,000	-	4,000
	Staff cost (b)	7,342	7,342	14,684
	Trainee allowances	5,614	5,614	11,228
	Workshop	1,010	1,010	2,020
	Promotion, recruitment and placement services	1,500	1,500	3,000
	Sub-total	34,116	15,466	49,582
(b)	Intermediate trade test
	Staff cost (c)	10,042	10,042	20,084
	Trade test materials	1,978	1,978	3,956
	Promotion and miscellaneous items	1,200	1,200	2,400
	Sub-total	13,220	13,220	26,440
(c)	Refresher/remedial courses
	Training materials	1,956	1,956	3,912
	Total	49,292	30,642	79,934

(a) An open training site of some 4 000 square metres is required for training Plant and Equipment Operators (Earth moving machinery).

(b) Including staff costs for a total of 20 full-time instructor s and clerks.

(c) Including staff costs for a total of 32 full-time instructors and clerks.