Building News is an information portal for all professional building specifiers. Here you can find all of the latest construction news from around the UK and the rest of the world.

Government must do more to tackle late payment in construction

The Government needs to wake up and legislate statutory requirements to make late payment a relic of the past, according to industry experts.

The business, energy and industrial strategy select committee has published ‘Small businesses and productivity’, a report which identifies the huge damage that late payment is inflicting on small business.

Rachel Reeves, chair of the committee, said “Many SMEs are placed in a stranglehold by larger companies deliberately paying late and ruthlessly taking advantage of their suppliers, causing these firms financial instability.”

Reeves went on to call for a statutory requirement for medium and large companies to pay outstanding invoices within 30 days, especially those involved in public procurement.

The National Federation of Builders (NFB), the voice of construction SMEs and regional contractors, welcomes the select committee’s long overdue recommendations, as well as the appeal to tackle late payment.

Jeremy Corbyn, leader of the Labour Party, highlighted in April 2017 how late payment hurt the UK construction industry and used his party’s general election manifesto to declare war on this practice.

The Conservatives also pledged to ensure large contractors complied with the voluntary Prompt Payment Code, which requires invoices to be paid within 60 days.

However, very little has changed. Carillion was able to win work from local government right up until its collapse, despite imposing 120-day payment terms which could be sidestepped upon paying a fee.

Richard Beresford, chief executive of the NFB, said “Late payment prevents businesses from investing, stops workers from getting paid and, ultimately, forces companies to shut down.

“It’s a shameful way to treat business partners in the supply chain but, almost one year from the collapse of Carillion, we have learnt absolutely nothing.”

Neil Walters, national chair of the NFB, concluded “Late payers continue to win public work and small businesses are left begging for their hard-earned money. Voluntary reform is simply not working and the Government needs to wake up and legislate statutory requirements to make late payment a relic of the past.”

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Volume of new homes being built continues to rise

Homes England have recently published their latest official housing statistics, which show the number of homes being built in England continued to rise in the first half of this financial year.

Between 1 April and 30 September 2018, programmes managed by Homes England started building 15,766 homes on site and completed a total of 15,704 homes. These figures represent 15% and 31% increases on the first half of 2017-18.

Affordable homes represented 63% of the housing starts (9,909 homes) – a 42% increase on the same period last year – and 71% of the housing completions (11,091 homes), a 19% increase on the number of affordable homes completed in the first half of last year.

A total of 5,857 homes for market sale were started in the six months to 30 September 2018 – a 13% cent decrease on the same time last year – however, the number of market sale homes completed in this period was up 69% to 4,613, compared to 2,737 last year.

Of the affordable homes started, 5,714 were for Affordable Rent – a 26% increase on the 4,526 started in the same period last year. A further 3,702 were for Intermediate Affordable Housing schemes (including Shared Ownership and Rent to Buy), representing a 71% increase on the same period last year. The remaining 493 affordable homes started were for Social Rent, an increase of 68% on the 294 started in the first six months of last year.

Of the affordable homes completed, 7,943 were for Affordable Rent – a 10% increase on the 7,219 completed in the same period last year. A further 2,841 were for Intermediate Affordable Housing schemes – an increase of 50% on the 1,900 completed in the same period last year. The remaining 307 affordable homes completed were for Social Rent, an increase of 76% on the 174 completed in the first six months of last year.

Nick Walkley, Chief Executive of Homes England, said “These latest figures show the overall number of homes being built continues to rise, reflecting the hard work being carried out by the housing industry to build better homes faster.

“However, while they are encouraging to see, we cannot be complacent. We know there is more work to be done to meet the Government’s ambition to deliver 300,000 new homes a year, so we will continue to intervene in the housing market and use our land, powers and influence to make homes happen.”

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Storage space boom – warehouse construction on the rise

As the popularity of online shopping continues to increase, the demand for storage space has followed, with an estimated £3 billion worth of contracts outlined for the construction of industrial warehouses across the UK in 2018.

According to construction analysts Barbour ABI, the first three quarters of 2018 accumulated £2.2 billion worth of warehouse construction contracts, an impressive increase of £800 million compared to 2016 figures. With the demand for consumer goods continuing to grow and the competitiveness of delivery speeds being of the utmost importance in today’s retail market, businesses are looking for convenient storage space to fulfil these needs to carry on competing.

Barbour ABI

Looking at the figures from a regional perspective, the East and West Midlands lead the way with a combined £2.6 billion worth of warehouse construction since 2016, worth over £400 million more than any other region. The location of the two regions alongside its convenient motorway links and rail connections makes them an attractive option for businesses.

Michael Dall, Lead Economist at Barbour ABI commented, “Since the start of the decade the UK has seen ever increasing numbers of warehouses being constructed as firms re-aligned their offer to meet the increasing propensity of consumers to shop online. From fashion to food, the need for more storage space to deliver to customers quickly and efficiently has resulted in a boom for warehousing construction.”

“With an increasing amount of shopping taking place online, we expect the number of warehousing construction contracts to continue to increase. In 2017 Barbour ABI recorded a 22% increase compared to 2016 and it is likely we will see a similar increase in 2018. With a number of these being Amazon warehouses, and considering the ambitious growth plans they have, this is clearly an area of construction that is primed for growth.”

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Sharp fall in migrant workers shows UK is already changing ahead of Brexit

The UK labour market is already changing ahead of its exit from the EU as the number of EU migrant workers fell rapidly over the last year, according to the latest labour market figures compiled by The Resolution Foundation

The figures show that the number of EU migrant workers in Britain fell by 4.5 per cent (107,000 workers) in the year to September 2018 – the sharpest fall since records began in 1997.

Britain’s pay recovery is gathering momentum too, with nominal pay growing by 3.2 per cent in the three months to September. This is the strongest growth since December 2008, though still well below the pre-crisis average of over 4 per cent. Above-target inflation means that real pay grew by just 0.9 per cent.

Stephen Clarke, Senior Economic Analyst at the Resolution Foundation, told buildingspecifier: “The sharp fall in EU migrant workers over the last year shows that Britain’s labour market is already changing ahead of its exit from the EU, and long before its post-Brexit migration plan is in place.

“Firms who employ a large share of migrant workers need to think now about adjusting to a lower migration environment, in terms of the workers they employ, what they produce and how they operate.

“The other big labour market shift that is still to come is a proper pay recovery. Yet we see further encouraging signs off the back of a tightening labour market. Nominal pay growth reached its highest level in a decade.

“However, a sustained pay recovery rests on stronger productivity and today’s sobering growth of just 0.1 per cent shows that this is still some way off.”

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Government plan to address long-term housing challenges

Homes England recently set out how they intend to improve housing affordability through a new five-year Strategic Plan – helping more people access better homes in areas where they are needed most. Buildingspecifier takes a look:

The government plan, which runs up to 2022/23, outlines an ambitious new mission and the steps the national housing agency will take, in partnership with all parts of the housing industry sector, to respond to the long-term housing challenges facing the country.

The new plan sets out far-reaching delivery objectives:

  • Unlock public and private land where the market will not, to get more homes built where they are needed
  • Ensure a range of investment products are available to support housebuilding and infrastructure, including more affordable housing and homes for rent, where the market is not acting
  • Improve construction productivity
  • Create a more resilient and competitive market by supporting smaller builders and new entrants, and promoting better design and higher quality homes
  • Offer expert support for priority locations, helping to create and deliver more ambitious plans to get more homes built
  • Effectively deliver home ownership products, providing an industry standard service to consumers

Speaking about the updated plans, Communities Secretary Rt Hon James Brokenshire MP said “This government is committed to delivering 300,000 homes a year by the mid-2020s and help more people get on the housing ladder. Homes England is at the heart of these plans.

“I welcome their comprehensive vision that sets out how through their powers and expertise they will maximise Government investment to deliver the homes communities need.”

Sir Edward Lister, Homes England Chairman, added “Ultimately, we need to disrupt the housing market. Homes England plans to be bold, creative and think big. We hope the whole of the housing sector – big and small, up and down the country – will join us for the next five years and beyond.”

Nick Walkley, Homes England Chief Executive, concluded “The new Homes England is all about making homes happen – and our new 5-year plan sets out our ambitious new approach. We are committing to boosting housing supply, productivity, innovation, quality, skills and modern methods of construction to help make a more diverse and resilient market. In return, we are calling for partners and the wider industry who share our ambition to challenge traditional norms and build better homes faster.”

The five-year Strategic Plan follows the Budget announcement of seven more strategic partnerships with housing associations, which will deliver an additional 13,475 affordable homes by March 2022.

The new partnerships will secure a total of £653m in funding from the Affordable Homes Programme, delivered through Homes England, including homes for social rent in areas of high affordability pressures.

This is in addition to the first eight strategic partnership deals announced in early July, bringing the total number of additional affordable homes that will be delivered to 27,755.

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Price-hikes on skips and diesel prove problematic for builders

According to the latest construction industry research, nearly two-thirds of builders have had to pass skip price increases on to clients and a fifth have had to pass on diesel price rises, making home improvement projects more expensive for home owners. Building Specifier delve into the details provided by experts the Federation of Master Builders.

The key results from the FMB’s research into skip prices are as follows:

  • Three quarters of builders have said that the price of skips has risen over the past 12 months
  • The average cost of an eight yard skip has gone up by £24 over the past year, meaning an additional cost of £360 for the average extension
  • Nearly two-thirds of builders have had to pass skip price increases on to clients, making home improvement projects more expensive for home owners
  • Three quarters of builders said that skip price rises have squeezed their margins

The widely-reported hike in diesel prices is also starting to bite and is having the following impact on small and medium-sized (SME) construction firms:

  • Nearly half of construction SMEs have made lower margins on projects
  • Nearly a fifth (17%) have been forced to raise the prices they charge clients
  • More than one in ten have had to turn down jobs they would have normally accepted as they are too far away
  • 10% have taken steps to reduce vehicle use

Commenting on the research, Brian Berry, Chief Executive of the FMB, said “The increase in the price of skips and diesel is bad news for builders and home owners alike. Nearly two-thirds of builders have had to pass skip price increases on to clients and a fifth have had to pass on diesel price rises. This has made home improvement projects more expensive for home owners. What’s more, the impact of the rising price of skips could have an impact on our communities through a rise in fly-tipping. No matter how much the price of skips might increase, there is never any excuse for fly-tipping and any individuals found doing so should be severely reprimanded. In 2016 and 2017, more than one million incidences of fly-tipping were dealt with by councils in England and the last thing anyone wants is for this number to increase.”

“The increase in the price of skips and diesel have come at a bad time for the UK’s builders. The cost of doing business is rising more generally for construction firms. Wages and salaries are all rocketing because of the ever-worsening skills shortages in construction. What’s more, material prices have been rising because of the depreciation of sterling following the EU referendum. Looking ahead, material prices are expected to cause an even bigger headache going forward, with recent research from the FMB showing that almost 90 percent of builders believe that material prices will rise in the next six months. We are advising builders to price jobs and draft contracts with this plethora of price rises in mind to avoid a further squeeze on already razor thin margins.”

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OPINION: Materials handling industry is at the mercy of Brexit

Building Specifier caught up with a leading expert in materials handling who warns of the impact Brexit will have on his industry.

Paul Casebourne, who has years of experience in creating engineering solutions and runs the Materials Handling Hub, believes that the industry has been forgotten as one of the potential casualties of the UK leaving Europe.

He claims the industry is already suffering as a result of the uncertainty about the country’s relationship with the EU.

The materials handling industry currently accounts for some of the biggest imports and exports in the UK, with machinery and vehicles accounting for a combined worth of £55b.

Half of this business is done with Europe and Mr Casebourne believes that if it is more expensive to trade with EU states post-Brexit, the outcome could be catastrophic.

He also warned “there are at least two major global materials handling companies who await the results of the troubled Irish Border question where skills are drawn from both sides of the divide.”

“The UK currently benefits from the free movement of goods within the EU. This means imports from other EU member states have no import duties, taxes or customs clearance,” he said.

“More to the point the harmonisation of engineering standards requires representations if we are to keep up with international projects. We currently have EU rights to be included in tenders within the EU, I have heard of no plans to make up ground in this respect.

“Forty years of work in the balance and not a word of comfort from the political structure.”

Casebourne also expressed his concern on the situation in the UK around export and import duties.

“Following Brexit, the UK will be back to custom clearing its EU imports as well as paying taxes and import duties on them and it’s possible that some goods will require an import license after Brexit,” he said.

“The extra tier of administration simply makes it harder to compete and adds unnecessary delays to international trade.

“Companies will have to revert to commercial invoices which determines the import duty they have to pay – all of which can have a huge impact on a business.”

Paul Casebourne

Mr Casebourne believes that while many industries have expressed their concern about what Brexit means now nobody seems to have looked at the impact this will have – and that it is already having – on the materials handling industry.”

Mr Casebourne, who has worked in the industry for more than 40 years and supplies equipment to a range of industries and also creates bespoke solutions, added that “we’ve already seen a number of big projects put on hold and people are reluctant to invest in new equipment.”

“Across the board business is not as good as it could be in the industry and the uncertainty about the future is not helping” he added, who via his Materials Handling Hub website shares best practice and brings together customers and suppliers.

“The whole situation really is intolerable at the moment while we are neither in or out. The UK has launched itself headlong into a 20-year project with no plan B, in fact without any plans at all whilst still handcuffed to the EU, powerless to put the plans in place that we need to get on with investing in our future.”

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Over 600,000 homes lay vacant across England alone

  • New study has found that 605,891 homes were unoccupied last year.
  • Liverpool has the biggest problem with vacant homes, with over 10,000 homes remaining empty in 2017.
  • A third of empty homes throughout the country are empty for longer than six months.

A new study has revealed the shocking extent of England’s empty homes crisis, with more than 600,000 homes remaining vacant.

The study, conducted by Good Move, has found that a third of empty homes are classed as long-term vacant, after being empty for more than six months.

The city of Liverpool takes the crown for the most vacant properties, with a staggering 10,512 properties laying empty last year. The data comes despite efforts by Liverpool City Council to reduce the amount of vacant homes with a free matchmaking service to introduce buyers and sellers of empty homes, in a bid to bring more empty homes into use.

Birmingham follows closely behind, with 10,386 empty homes. The city famous for its Bullring accounts for 17% of West Midlands’ total number of vacant homes.

The Yorkshire city of Leeds has the third highest number of empty homes throughout the country, with 10,263 properties vacant. Leeds’ empty homes equates to 14% of Yorkshire and the Humber’s empty homes.

The North West has the most vacant properties, with 102,847 homes laying empty across the region, and 38% of those being vacant for longer than six months. Liverpool has the most empty homes in the North West, and the country as a whole, with 10,512 vacant properties in 2017.

Following closely behind the North West is the South East, with a staggering 86,693 vacant properties last year. Of the 86,000 empty homes, 29% of those are vacant for longer than six months.

The top five cities with the highest number of empty homes are:

City Number of vacant homes (2017) As a % of all housing
Liverpool 10,512 4.70%
Birmingham 10,386 2.40%
Leeds 10,263 3.00%
Durham 10,026 4.20%
Bradford 8,751 4.10%


England regions by number of vacant homes:

Region Number of vacant homes (2017) As a % of all housing Long-term vacant*
North East 43,617 3.60% 17,106
North West 102,847 3.20% 39,344
Yorkshire & The Humber 73,728 3.10% 27,009
East Midlands 52,562 2.60% 18,553
West Midlands 62,919 2.60% 20,996
East of England 58,831 2.20% 17,983
London 62,366 1.80% 20,237
South East 86,693 2.20% 25,378
South West 62,328 2.50% 18,687
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Government call for green innovations to beat climate change

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Britain’s best innovators and researchers are being invited to pitch their ideas to help tackle the effects of climate change on towns, cities and the countryside as part of modern Industrial Strategy.

Business and Energy Secretary Greg Clark recently announced 4 new research programmes to boost the UK’s resilience to climate change, develop digital environments, promote clean air and investigate how to use our land to boost health outcomes.

The £60 million funding pot was announced during the first ever Green GB Week – a government-led week of campaigning to encourage businesses, communities, funders and academics to renew their efforts to confront the global challenge of climate change.

Business Secretary Greg Clark said “Companies are capitalising on the UK’s world leading position in the greener economy as we transition to a greener, cleaner economy and is one of the greatest industrial opportunities of our time.

“The UK is a world leader in tackling climate change, cutting our emissions more than 40% since 1990 while growing our economy. When you combine Britain’s leadership, innovation and determination it is an unbeatable combination – exactly what our Industrial Strategy and Green GB Week are supporting and encouraging.”

UK Research and Innovation Chief Executive, Professor Sir Mark Walport, said “The recent IPCC report is a timely reminder of the challenges we face in tackling climate change. Storm Callum has highlighted the impact that extreme weather events can have on our communities.

“It is vital that the evidence generated by research is used effectively to navigate and mitigate the effects of climate change, and new technologies are developed to support a move to a low carbon economy.

“The Strategic Priorities Fund is important in supporting UKRI’s mission, allowing us to bring collective expertise from a wide range of disciplines and sectors to bear on addressing important matters affecting all of society.”

The programmes, administered by UKRI, will bring together a broad range of research disciplines, ranging from mathematics and biology to climate science and technology development to:

  • produce better data on climate risks to the UK
  • build a digital picture of our natural environment for greater monitoring and analysis of the impact of climate change
  • cut air pollution and protect vulnerable groups from its effects
  • use our land better, for the benefit of the environment and communities
  • develop ways for the UK to adapt to climate change

Chief Scientist of the Met Office, Professor Stephen Belcher, said “These programmes will allow the Met Office and our partners to make real progress in two areas of significant environmental impact: air pollution and climate change.

“Working together with other world-leading scientists from the UK’s academic community, we will be able to deliver tools and services which will benefit the lives and livelihoods of people across the UK.”

Competitions for the programmes will open in the coming weeks. Researchers and innovators can visit the UKRI website for updates.

The funding comes as part of the Strategic Priorities Fund, delivered by UKRI to drive an increase in high quality multi- and interdisciplinary research and innovation. It will ensure that UKRI’s investment links up effectively with government research priorities and opportunities. Further programmes will be announced in the coming months.

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