Current Issues - 2nd Quarter 2001 Possibly as a reflection of the relatively high level of building activity recorded by this survey, a lower than usual proportion of respondents, only around a fifth of the total, added comments on either the state of trade or issues which members believe the FMB should be addressing on their behalf. Throughout 2000, and again in the first quarter 2001 survey, the operation of the Construction Industry Scheme (CIS) for the taxation of sub-contractors showed up as one of two issues causing greatest concern to small and medium-sized building firms, along with the rate of Value Added Tax on construction work. Both these topics show up quite prominently again this time, but in each case the level of concern expressed is lower than in any of the five preceding surveys. Where the CIS is concerned, it is noticeable that most of the concerns expressed this time relate to the 'red tape' and form-filling aspects of the scheme, rather than its impact on competition, particularly in the private housing repair, maintenance and improvement market, which has been highlighted in previous surveys. On this occasion only one respondent has written about trades that were formerly available to work as sub-contractors ahead of the CIS now opting to work direct to the domestic customer, and there are relatively few comments on other competition issues. There is an unusually small number of complaints about the activities of 'cowboy builders', almost matched this time by concerns over 'cowboy clients' withholding payment for work done, including work authorised and paid for by insurance companies, or otherwise not honouring their contractual commitments. Other subsidiary topics under the broad heading of 'red tape', which has this time attracted more written-in comments than any other topic, again include stakeholder pensions and the 'tax collector' role that the employer is required to play, in respect of taxes on employees' incomes and VAT. Some comments on the impact of 'red tape' on the building SME are most disturbing given the current balance of demand and supply in the industry, with a rise in the number of members threatening to leave the industry on account of what they see as the growing burden of bureaucracy. Close behind the total of comments on 'red tape' is the total number written in about various aspects of the labour supply situation, mostly about recruitment and training of young entrants to the construction workforce. There is a clear willingness to take on and train young entrants, preferably by the traditional apprenticeship route, but firms are deterred for a variety of reasons, including the cost, the attitude of some schools to careers in construction, and the attitude of young people themselves, not just to the opportunities offered by construction but more generally towards the world of work. As was noted last time, some of the comments received on recruitment and training are again linked to others on quality, and the accreditation of both workers and building firms. In this area also, however, there is concern over the cost to the SME of the sorts of schemes that FMB members would like to see put in place, and a number of requests for Government help towards the funding of both accreditation and training. One topic that has appeared for the first time in this survey is the impact of foot and mouth disease, with comments on the effects on building workload being received from both the South West and North West of England. The most specific of these refers to the impact on demand for building work from the hospitality industry and others catering for tourists, rather than from the agricultural community. First posted: 17 July 2001. Last modified: 18 July 2001.