BECTU response to UK Government consultation: Delivering an Incentive for Membership Bodies to Provide Workforce Development

25 February 2004

Introduction

1. BECTU is the trade union for creative, technical and administrative workers in the audiovisual and live entertainment sectors. We have a close and long established interest in training issues - especially in the light of the rapidly changing skills requirements in the areas in which our members work.
2. We support the Government proposals to review and extend the narrow scope of sections 343 and 344 of the Income Tax Earnings and Pensions Act 2003. We believe it will be entirely appropriate for the review to acknowledge the role that trade unions play in 'supporting the provision of training and staff development opportunities across the workforce' and consequently to broaden the scope of the current system of tax relief on trade union subscriptions.

BECTU's training role

3. Along with the TUC, we note the recognition, in the Government's Skills Strategy White Paper of the 'vital role [of the TUC and trade unions] in encouraging individuals back into learning through help and support in the workplace'. We believe the evidence already clearly indicates the very significant contribution of trade unions in delivering the Government's agenda on lifelong learning and on basic and key skills.
4. In our own area we have developed a number of relevant projects, including (as examples only):
   • TOCSA: a basic and key skills project for workers in the arts and entertainment sector.
   • The BECTU Online Learning Toolkit: encompassing the organisation of a network of Union Learning Representatives (ULRs) and the use of a customised learning website.
   • Roving Learning Representatives (or Learning Advisers) in Wales and in London.
   • Research for the Learning and Skills Council (London Central)
5. In addition, we are extremely active in the area of vocational training, retraining and guidance through the direct provision of courses; cooperation in service delivery by partners and subcontractors; active representation at all levels and in all activities of our relevant Sector Skills Council (Skillset); participation in joint industry training initiatives (eg FT2 for new-entrant training); and joint sponsorship with Skillset of the 'skillsformedia' career guidance project.

Broadening the criteria for the relief on subscriptions

6. In seeking to develop new criteria for tax relief on subscriptions - which would recognise the union role in workforce development referred to above - we believe, as the discussion paper itself indicates, that 'a more flexible approach may be needed to measuring inputs and outputs'.
7. We support - as one key measure of union activity in this area - the TUC suggestion of basing eligibility for relief (to a degree) on the number of members to whom ULRs promote lifelong learning. We recognise the advantages of using such a specific and quantifiable criterion - encompassing the numbers of ULRs together with the growing evidence (eg the report by York Consulting in 2000 on the Union Learning Representatives' Survey) on the number of members supported by each ULR. The resulting number of members covered by ULRs, as a proportion of total union membership, would give one measure of the appropriate level of tax relief on union subscription income.
8. As with many other unions, however, we believe the ULR criterion is not the only valid measure of union training activity. In a narrow sense it would under-estimate our efforts to develop a network of trade union 'learning advisers' for our freelances (since these would not necessarily qualify as ULRs in the exact sense of the Employment Act 2002) - and yet such advisers are a radical and useful innovation to promote learning among the large proportion of our members (over one-third) who are atypical workers. In a broader sense, sole reliance on ULRs would omit a range of other measurable criteria such as the proportion of staff time or of direct and indirect union spending on training and learning activities. We are therefore open to a flexible approach incorporating other criteria in additional to ULRs.
9. Whatever criteria are eventually agreed, we would accept the right of the Inland Revenue to audit any claims made, with the additional possibility of periodic (eg 10 yearly) reviews.

A collective system of claiming relief

10. We believe that it is trade unions as collective organisations which are driving and developing the wide range of training and learning activity referred to above. In our view, it is therefore appropriate that the mechanism for claiming tax relief on union subscriptions should be through each union as a collective body rather than through the claims of individual union members, ie the tax relief should fall to the union as an organisation. This collective approach to tax relief will provide a strong incentive for unions to maintain and develop their activity in workforce development.
11. We accept that some unions or other professional organisations may wish to continue with a system of individual tax relief as at present. We would have no objection to retaining this as an option for those organisations that prefer to continue with such an approach.

Conclusion

12. We believe that the discussion paper is welcome and timely. We hope that the Inland Revenue will now give due consideration to a system of collectively-claimable tax relief by trade unions with a verifiable level of activity in workforce development (as measured by means of ULRs and other agreed criteria). We look forward to further progress on the issues raised in the paper.