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.

New survey highlights issues and opinions in the construction industry today

UK Construction Week, the UK’s largest gathering and community of construction professionals, has conducted a survey to uncover and tackle issues facing construction, housebuilding and skills in the run up to the General Election. With over 1,000 responses from a cross section of professionals working in the sector, key points from the survey include:

  • Sir Richard Branson is named as ‘the best person’ to head up new UK infrastructure projects
  • 77% believe state intervention is needed for more housing
  • 38% want Gavin Barwell to retain his position as Housing Minister
  • 54% call for more housebuilding on brownfield sites

One of the most significant results from the survey was for Sir Richard Branson, who was voted as the best person to spearhead new UK infrastructure projects, such as HS2 and Heathrow Airport, signalling a need for more entrepreneurial vision in tackling large scale projects.

On the result, Sir Richard Branson said “I’m very flattered by the survey. The only danger is that if I oversaw these key infrastructure projects then by the time I’ve finished there would only be room for one airline and one train company, both beginning with the letter V! The key thing one needs to get right is to plan these major projects with the customer’s needs in mind. Too often these are planned by engineers for engineers and fail to meet the user’s demand. This means they are underused and fail to have the major impact they should do.”

Further results show a three way split on the government’s current housing policy with a third of those polled voting both for and against current policies, and a third not convinced either way.

Over half of those surveyed (54%) called for the next elected government to be more aggressive with planning permissions on brownfield sites to enable house building. Only 11% voted to loosen Green Belt restrictions, dispelling the myth that the construction industry wants to build on protected land.

Although the industry isn’t wholly satisfied with current housing policy, Gavin Barwell was voted overwhelmingly in favour as the best man for the job of Housing Minister, with the next name suggested, Boris Johnson, only receiving a quarter of the number of nominations. Labour’s John Healey, previous Housing Minister under the Labour government, was the third suggestion.
77% of those surveyed believe the only way to reach 1 million homes by 2020 is by state intervention, and for a council house building programme to begin.

For infrastructure, there was a two way split between Vince Cable and Sir Richard Branson who were both voted as the best people to lead UK infrastructure projects, followed by Sir Alan Sugar and Sir James Dyson. A clear indication the industry feels it needs entrepreneurial visionaries to successfully take projects forward to 2021.

In terms of major projects the industry is generally positive about these going ahead with a Conservative government, with HS2 and Heathrow seen as the safest projects followed by Hinkley point, Crossrail 2, Thames Tideway and the road renewal building programme.

However, there is a real concern that major projects will stall if the Conservative government is not re-elected, with a majority of those surveyed believing all projects will stall with HS2 coming out on top (44%) followed by Crossrail 2 (40%) followed by the road renewal building programme (40%), Hinkley Point (30%), Thames Tideway (30%) and Heathrow third runway (26%).

Nathan Garnett, Event Director at Media 10, which runs UKCW, said: “We have seen a great deal of talk around housing and infrastructure in this general election campaign so far, so I think that the main political parties should take note of this industry wide survey. It shows that there are still a lot more assurances and interventions needed to build the homes we need and the infrastructure we have been promised. We will be using these results to make sure the main political parties know what the industry wants, and one clear message is that innovation and entrepreneurial endeavour cannot happen without government assistance.”

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VAT cut would spark building boom

Plaid Cymru’s proposal to cut VAT on home renovations would spark a renaissance in the Welsh construction sector, the Federation of Master Builders (FMB) Cymru has said in response to the Party’s announcement.

Ifan Glyn, Director of FMB Cymru, said “We welcome the announcement that Plaid Cymru would press the UK Government to reduce the amount of VAT currently charged on domestic refurbishment work. The economic benefits of a VAT cut would be significant and timely, given the uncertainty facing the country as it starts the process of departing the EU. Research has demonstrated that cutting VAT on such work would provide an annual £50 million stimulus to the Welsh economy, revitalising a sector that has suffered decidedly mixed fortunes over the last decade. Far from depriving the treasury of revenue, experience from the Isle of Man suggests that the reduction could actually increase net revenues by boosting demand and cutting out the black market.”

“Moreover, it would provide a necessary shot in the arm in the effort to improve the energy efficiency of Welsh homes and help reduce our carbon emissions. Our housing stock is amongst the oldest in Europe, which is a major factor behind the generally poor levels of energy efficiency in our homes. A reduction in VAT would incentivise property owners into investing to improve the energy efficiency of their homes, thereby cutting energy bills. This could play a significant role in tackling fuel poverty, which remains a serious issue for Wales.”

“A tax stimulus could also yield further dividends in the form of empty homes being brought back into the market. There are currently 25,000 properties that are unoccupied in Wales and which could be fully inhabitable again if the incentive to renovate those homes existed. This would be equivalent to nearly two years’ worth of the supply of new homes that it is agreed Wales needs to tackle our housing crisis. Obviously, Plaid Cymru are in no position to win the General Election, but this policy highlights that a VAT reduction on home renovations is both feasible and highly desirable for the Welsh economy.”

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What Corbyn’s leaked draft manifesto says about construction

A few details from a draft version of Labour’s upcoming manifesto have been leaked. What does it say about construction, house building and infrastructure? Buildingspecifier.com investigates:

Energy

The leaked data highlights plans to bring parts of the energy industry into public ownership and introduce a local, socially owned energy firm in every area. Also introduce an “immediate emergency price cap” to make sure dual fuel bills stay below £1,000 a year.

Infrastructure

As well as nationalising the railways, Corbyn proposes to borrow £250bn to invest in infrastructure but stick to the fiscal credibility rule to balance day-to-day spending. He also plans to complete HS2 from London to Birmingham, Leeds, Manchester and Scotland.

Housebuilding

The draft includes a target for tackling the housing shortage, suggesting that we build 100,000 new council houses per year. Additionally, Labour would see the homes of disabled veterans insulated for free.

Skills

In a bid to tackle the skills gap without jeopardising the potential for attracting home-grown talent, the draft manifesto urges us to recognise the benefit that immigrants have brought to our industry but also introduces fair rules and reasonable management. Corbyn promises to work with employers that need to recruit from abroad but emphasises the need to prevent exploitation.

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NHIC issues ‘Five Point Plan’ for Government

The National Home Improvement Council have launched their industry-led manifesto outlining five key areas it feels the next UK Government should focus on alongside negotiating Britain’s departure from the European Union.

The National Home Improvement Council wants all political parties to clearly establish in their manifestos how they would work with industry to overcome some of the fundamental challenges currently faced by the country, including not only the need to build more quality energy efficient homes, but also how to improve the quality of our existing housing stock.

Anna Scothern, Executive Director of the NHIC said ”Great Britain is one of the richest countries in the world, yet 4.5 million families still live in fuel poverty. The National Home Improvement Council believes that no individual or family should have to make ‘heat or eat’ choices each winter.” She added “27% of the UK’s CO2 emissions come from our existing 26 million homes and while demand for housing continues to rise with new house building failing year-on-year to meet the established government target of 1 million new homes by 2020, refurbishment, repair and maintenance must be an essential part of the new Government’s overall housing strategy.”

The National Home Improvement Council, established in 1974, is a member-based organisation whose primary aim is to encourage the safe and efficient refurbishment of the UK’s existing homes across the private and social housing sectors, to improve living standards and reduce fuel poverty. The NHIC uses expertise from across its membership to bring about positive change for UK homes and looks forward to working with the new Government to address these important issues.

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Skills shortages remain key challenge to infrastructure delivery

Construction and infrastructure workload expectations continue to improve with respondents the most positive since the referendum, according to the latest Royal Institution of Chartered Surveyors (RICS) Construction and Infrastructure Market Survey, Q1 2017. The pace of growth has increased across all sectors pointing to a widespread improvement in the sector.

In Q1 2017 27% more respondents reported an increase in workloads, (up from +18% in Q4 2016). Expectations for the next 12 months also remain firmly positive particularly for activity levels although they have reduced slightly in case of profit margins.

The shortage of skilled labour persists in UK infrastructure and construction and is again widely cited by contributors as a factor potentially impacting the performance of businesses working in the industry.

Looking at the different sectors, 34% more respondents cited an increase in private housing output rather than a decrease, which puts it above the other sectors for the pace of growth once again; this has been the case since Q1 2013.

While the commercial sector saw the largest growth in workload for the quarter (compared with Q4 2016) with 31% more respondents seeing a rise, infrastructure workloads continue to grow steadily with the most significant increases in rail, road and energy categories.

These sectors are also viewed as the most promising sectors in infrastructure for the next 12 months. Breaking this down, 60% of respondents felt that repair and maintenance work of existing structures is the most needed type of investment in their area whilst 40% felt investment in new projects was necessary.

Growing skills shortages

As workloads increase, skill shortages are still sighted as a significant problem to the industry with 53% of respondents stating a shortage of skilled labour to be a key impediment to growth.

This is slightly up from 50% in the last quarter. In recent reports, the proportion of respondents noting skill shortages to be the major barrier to growth had come down slightly but the latest results along with surveyors’ comments suggest labour shortage pressure across the UK construction sector is intensifying once more.

Alongside this, 65% of respondents reported insufficient availability of quantity surveyors, with skill shortages in this area becoming increasingly prominent since 2012. The results also point to the quality of available workers (rather than simply the quantity) being the principle driver in skill shortages, with 67% of respondents taking this view.

Looking at this further, 59% of contributors feel that improved education pathways and training would the most effective policy response to alleviate labour supply pressures, whilst 31% of contributors feel direct government subsidisation of training would be the most effective.

Financial constraints and their impact

Meanwhile, financial constraints are still the most significant obstacle to growth with 70% of respondents citing this as an issue. Planning and regulation remains a significant impediment to growth with 61% of respondents citing this as an obstacle (up from 53% in Q4 2016).

At the same time, tender prices are expected rise in the next 12 months. Specifically, 69% more respondents believe tender prices will go up in the building sector (rather than fall). The expected increase in tender prices may signal rising costs and shrinking profit margins which is also reflected in the 12 month expectation of profit margins easing from +26% in Q4 2016 to +18% in Q1 2017.

Regionally all parts of the UK have observed an increase in pace of output growth in Q1, with the exception of Northern Ireland. The was due to the pace of growth slowing within the infrastructure, private industrials and public non-housing sectors. Output growth gathered the most pace in London and the South East where the net balance rose from +7% to +22%.

Jeff Matsu, RICS Senior Economist said “The mood music in the construction sector has improved in line with the better tone to macro data more generally. However the survey does highlight some key challenges that need to be addressed if government’s ambitious plans for housing and infrastructure, in particular, are to be met. Access to finance, alongside planning and skill shortages, both quality and quantity, remain big obstacles to delivery and though some plans are in place to address these issues, it remains to be seen whether they are sufficient to make a meaningful impact.”

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Green Belt and the West Midlands Mayoral Election: what you need to know

The inaugural West Midlands mayoral election will be held Tomorrow to elect the Mayor of the West Midlands. All candidates have discussed building on green belt and brownfield sites in varying levels of detail, so it’s safe to say that Thursday’s result will be of keen interest to industry professionals. Buildingspecifier Editor Joe Bradbury investigates:

Thursday’s election will be the first election for a governing body covering the entire West Midlands since the 1981 West Midlands County Council election (subsequent elections will be held May 2020 and then every four years after that). Following a devolution deal between the UK government and the West Midlands Combined Authority (WMCA), it was agreed to introduce a directly-elected mayor for the combined authority, who would act as chair of the combined authority as well exercise additional powers and functions devolved from central government relating to transport and housing and planning.

Devolving such powers from central government relating to housing and infrastructure in particular naturally raises the ethical dilemma of building on land that is currently protected by Green Belt. This is understandably a strongly debated and highly controversial topic. Many campaign groups urge governments to develop brownfield sites instead, in order to protect England’s characteristic and environmentally significant countryside. However, there is also a very genuine argument that the green belt is an archaic obstacle hindering UK housing and construction in general. Let’s explore the topic:

The argument for…

The British countryside is world renowned and entrenched in our national sense of identity. It is undeniably vital that we continue to protect green space in a country known affectionately as “a green and pleasant land,” however, one cannot ignore the sad fact that the benefits of the Green Belt often accrue to a small group of people at the expense of many more in denser areas.

Studies suggest that access to the Green Belt correlates closely with household income: Green Belt policy preserves large amounts of plentiful green space around the well-off at the expense of rarer green space near the low-income areas of British cities. By limiting supply the policy inflates house prices and rents and acts as a de facto wealth transfer from poorer non-homeowners to middle- and upper-income homeowners.

Only 10% of land in England is developed, just over half of this, 5% of total land, is for homes and gardens, with only 1% of all land actually used for housing. If we were to increase our housing stock by 1.3% per year this would make a massive difference in tackling the housing shortage and would involve building on a mere 0.01% of land each year; a small loss to solve the housing crisis, many argue.

The argument against…

When looking at the argument against developing on Green Belt land, concerns seem to gather around the potential of opening a floodgate whereby once permission is granted, England’s green and pleasant land will descend into a concrete carbuncle.

The Green Belt became government policy 62 years ago this year. On its 60th anniversary, a poll commissioned by the Campaign to Protect Rural England (CPRE) found that nearly two-thirds of people surveyed believed that Green Belt land should not be built on.

The Ipsos MORI poll shows that 64% of people agreed the Green Belt should be protected, while just 17% disagreed. Such strong support for Green Belt is demonstrated across a range of different groups, including people with children aged 5 and under, those renting from a local authority, and those on low incomes. And more than six out of ten people (62%) who live in towns and cities support the protection of the Green Belt – a finding that casts doubt on the claims of critics that Green Belts do not benefit people who live in urban areas.

Mayoral candidate stances

Whatever your thoughts are on Green Belt, we are all in agreement that more homes are needed in Britain today. Perhaps what we really need is tangible, immoveable targets that won’t change the second permission to build in the countryside is given. Just how will your vote affect this? Let’s take a look at the stances taken by some of the candidates reliant on your vote:

Andy Street – Conservatives

Andy Street

From the conservatives, the message seems quite clear – always prioritise brownfield sites when planning where we need to build homes in the West Midlands. Andy’s manifesto promises to spend £200 million on preparation and decontamination of brownfield sites and lobby for more. It also highlights plans to work with all councils to compile registers of all brownfield sites that could be used for housing and business development in the West Midlands.

Andy speaks of pushing Government and councils to release public sector land in the West Midlands, to be used for housing.

Sion Simon – Labour

Sion Simon

Labour Mayoral candidate Sion Simon is more open to the potential to develop Green Belt land for the benefit of the West Midlands. Recently, he has criticised West Midlands borough Solihull for blocking green belt housing schemes and also pointed out that the town is one of the wealthiest parts of the West Midlands.

Last month, Sion called for housing on Solihull green belt during Wednesday’s mayoral hustings, saying “People want new housing but don’t want it on their Green Belt, they want it on someone else’s Green Belt.

“They want the land but don’t want the cost of cleaning up dirty land. We need to start those difficult conversations.

“And the most difficult conversation is with Solihull – which has the great bulk of the wealth and a huge pressure on land and has very expensive land.”

James Burn – Green Party

James Burn

James Burn of the Green Party seems to have a similar message to that of the conservatives, arguing for the prioritisation of building on brownfield land first.
He promises a drive on local authority house building funded by central government, in addition to other measures, including exploring the introduction of a Land Value Tax (which may discourage developers purposefully not building on valuable land and bring more land into use for housing more quickly) and raising the local authority borrowing cap so that councils can borrow more to build more houses.

The manifesto states that “We will need serious discussions about where the houses should be located, the cause and extent of the crisis, where higher density building is appropriate and much more.

“We also need to increase the supply of available land while doing all we can to protect valuable green spaces. We should in general build on brownfield land first wherever possible, and challenge the assumption that this is always more expensive than building on green belt sites.”

In summary

To the casual observer (and fellow Midlander!) it seems to me that all candidates are calling for an honest and open conversation about developing Green Belt land, yet none seem to want to commit entirely to one side of the argument – or at least discuss it on any level that may give too much away on the subject prior to the election tomorrow.

Green Belt divides opinion so drastically across all sectors of our industry. Concerns about it echo through our communities and create barriers as tangible as the physical border itself. Whether you campaign for it to be protected or petition to open it up for development, anybody who builds houses or needs houses should think carefully before entering the polling booth tomorrow, because your vote just might dictate their location.

Do you think we should consider building on Green Belt? Answer the poll on the right!
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Sadiq Khan scraps controversial Garden Bridge

The Mayor of London, Sadiq Khan, has today written to the Chair of the Garden Bridge Trust informing him that the GLA will not be providing Mayoral guarantees for the Garden Bridge project.

In a letter to Lord Mervyn Davies today, the Mayor outlined his view that the continuation of the project will expose the London taxpayer to additional financial risk, both with regard to the bridge’s construction and its operation and maintenance.

Before making the decision, the Mayor analysed the findings of Dame Margaret Hodge’s independent review into the Garden Bridge project, and assessed all the information available about the project to date.

During the Mayoral campaign and since his election last year, the Mayor has repeatedly stated that he would not agree to any more of London taxpayers’ money for which he is responsible being spent on the Garden Bridge project. He had also made clear that he would not provide any Mayoral guarantees unless he was convinced that the project would not lead to additional public expenditure down the line.

In outlining the reasons for the Mayor’s decision not to provide any Mayoral guarantees, today’s letter outlines a number of ways in which the project would expose the London taxpayer to additional financial risk. These include:

  • increasing capital costs of the project;
  • the risk of the bridge only being partially built; and
  • doubts over the establishment of an endowment fund to help meet future maintenance costs.

Mayor of London, Sadiq Khan said “Under the previous Mayor, a considerable amount of London taxpayers’ money has already been spent on the Garden Bridge. I have always been clear that not a penny more of taxpayers’ money should be allocated to the project.

“Having assessed all the information available to me including the findings of Dame Margaret Hodge’s independent review, my view is that providing Mayoral guarantees will expose the London taxpayer to too much additional financial risk.

“With planning permission due to expire this year, many outstanding issues remain, including spiralling construction costs and doubts around funding the maintenance of the bridge.

“The funding gap is now at over £70m and it appears unlikely that the Trust will succeed in raising the private funds required for the project. I am simply not prepared to risk a situation where the taxpayer has to step in and contribute significant additional amounts to ensure the project is completed.”

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Heathrow moves to revolutionise UK construction industry

  • Heathrow to use £16bn expansion to push growth in off-site construction in UK
  • In a first for a major infrastructure project, Heathrow invites communities across Britain to showcase why their area should host one of four new off-site logistics hubs
  • New logistics hubs key to Heathrow’s plans to build as much off-site as possible, making the project more affordable and environmentally sustainable while driving growth across Britain
  • Research reveals growth in the sector could boost Britain’s construction industry by up to £15bn outside London by 2020 alone

In a shake-up of the UK construction industry, Heathrow announced it would use its £16bn expansion project to revolutionise the way Britain builds major infrastructure.

Heathrow CEO John Holland-Kaye announced that the airport would be making a major push to support more off-site construction in the UK as it begins to deliver its expansion plans for Britain – a move designed to boost productivity and help rebalance the economy. The announcement comes as new research from economic consultancy WPI Economics revealed growth in the sector could lead to a £15bn boost for the construction industry outside London by 2020 alone.

Speaking to council leaders and representatives from the construction industry, Heathrow kicked-off the hunt for four UK sites to host the new off-site logistics hubs which will help deliver its expansion programme and drive growth across Britain.

Heathrow’s new logistics hubs will pre-assemble components of the expanded airport before transporting them in consolidated loads to Heathrow. By not building everything on-site at one of the world’s busiest airports, the logistics hub will play a key role in supporting the project’s efficient delivery, will make the project more affordable and will reduce emissions by transporting assembled components to site in fewer lorries. The new logistics hubs will also spread the jobs created from the project across more communities in every corner of the UK.

While off-site construction has enjoyed some success in the construction of homes – reducing costs by up to 25% and speeding up project delivery by 30% – the approach has had a limited role supporting major infrastructure projects. With Heathrow expansion set to be one of Britain’s largest infrastructure projects, the airport is aiming to drive a step-change in Britain’s construction industry and give Britain a leading-edge in an untapped new sector that can then be leveraged to support other major projects around the world.

Heathrow CEO John Holland-Kaye said “The global construction industry is set to be worth £15 trillion by 2025 – that’s a huge prize that Britain deserves a bigger share of and Heathrow can help.

“We want to use Heathrow expansion to not only upgrade Britain’s infrastructure, but cultivate a new world-leading sector and drive growth across the whole country. Boosting off-site construction will help make expansion more affordable and environmentally friendly and give Britain a lasting legacy of expertise that it can sell around the world – helping Britain lead the pack in global construction.”

In a first for a major infrastructure project, Heathrow is inviting communities across Britain to showcase why their area is suitable to host one of the new logistics hubs. Suitable locations will have good connectivity, access to a relevant supply chain and strong local skills. Interested applicants should click here to register their interest and complete Expression of Interest questionnaire before 31st July 2017. All applications will be considered by Heathrow and a list of potential sites is expected to be announced later this year.

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General election: dividing opinion

The construction sectors are currently abuzz with discussion about the potential effects a General Election will have on our industry. With some seeing it as an opportunity to refocus strategy and others concerned the fallout will impact heavily on future investment, Theresa May’s announcement has certainly divided opinion.

Carolyn Fairbairn, Director-General at the Confederation of British Industry (CBI) said “With a snap General Election now called, businesses will be looking to each political party to set out their plans to support economic stability and prosperity over the next Parliament in a way that is fair and sustainable for communities across the UK. Distraction from the urgent priorities of seeking the best EU deal and improving UK productivity must be kept to a minimum.

“It is essential to get the UK’s foundations right, from building a skills base for the next generation, to investing in infrastructure, energy and delivering a pro-enterprise tax environment.
“Whoever forms the next Government, they should seek to build a partnership between business and government that is the best in the world, based on trust and shared interest.”

Lewis Johnston, RICS Parliamentary Affairs Manager said “Since the EU referendum last summer, our market surveys across the residential, commercial and construction sectors show we have largely moved on from initial negative reactions but uncertainty continues to cloud the outlook and weigh on market sentiment. Today’s decision does very little to change that prognosis in the near term, and if anything we are likely to see continuing deferral of major investment and hiring plans.

“Whilst Theresa May’s stated intention this morning was to provide greater clarity and stability by calling a general election, in the immediate term the move inevitably puts a question mark over policy and creates further uncertainty across the built environment. It is now the responsibility of all parties to set out clear policy proposals across land, property, construction and infrastructure to ensure the UK can deliver the homes, infrastructure, factories, offices and major building projects it needs to thrive.”

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New DAB radio station launching for construction industry

Fix Radio, the new DAB station aimed at tradespeople, will be giving out 20,000 bacon butties to builders after it launches on Wednesday 26th April. (That’s over a tonne of bacon!)

Three branded bacon butty vans will visit 1,400 building sites over 40 days serving free hot food and promoting the new station.

Fix Radio will be launched by a mystery celebrity connected to the building trade who will press the button to play the first song.

The breakfast show will be presented by Trev and Ben – Trevor Smith and Ben Harmer – who join from community radio in Croydon. Their show will feature a daily wind-up call from former Capital Radio star Steve Penk.

Veteran presenter Paul Baker will present the afternoon show and is also Fix Radio’s Programme Director.

There will also be a daily sport and music show at lunchtimes hosted by TV and radio sports presenter Ian Payne from ITV and LBC.

Fix Radio is already working with some high-profile trade brands and launches with several months’ worth of advance advertising and sponsorship.

In addition to its DAB broadcasting, Fix Radio will be targeting larger building sites by playing in their canteens giving a guaranteed listenership of 4,000 tradespeople from the start. More canteens will be added.

Louis Timpany, chief executive, says: “The launch of Fix Radio is the culmination of 18 months of fund-raising, research and development. We’re very excited to see it all come together at last.”

Fix Radio will provide music and cheeky banter aimed at bricklayers, plumbers, electricians, plasterers, roofers, painters and decorators whether they work on site or in people’s homes.

Louis, 24, came up with the idea after working on a building site to earn extra cash after university. He teamed up with radio consultant Paul Chantler to develop the concept, attract investors and build the station. A number of prominent radio executives have invested in the station.

Imaging for Fix Radio has been produced by Wise Buddah Jingles. London and building trade news will be provided by Radio News Hub and The Met Office will supply specially targeted and detailed weather forecasts which are vital for tradespeople working outdoors.

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