Two years after Genfell, what’s still to be done?

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

Following the devastation of the Grenfell Tower tragedy, the government carried out an independent review of the Building Regulations and Fire Safety. This week, they published a ‘clarified version’ of Approved Document B.

The new version is simplified, uses less jargon and is written in plain English. It now means that building owners can easily follow and understand the requirements expected of them, limiting any misunderstanding of their responsibility for the safety of residents. The document also brings together guidance for flats and houses.

While this is certainly a step in the right direction and should help building owners going forward, it’s been over two years since the Grenfell tragedy and people continue to campaign for safety in tower blocks, proving there is still so much to be done.

Last month, for the second anniversary of the Grenfell disaster, campaigners shone a spotlight on unsafe tower blocks across the country and a tower block in Newcastle was right at the centre. Messages were projected onto the blocks to highlight a genuine safety concern of residents within that building, it read: ‘2 years after Grenfell and the fire doors in this building still don’t work’. I’ve never really discussed the repercussions, or lack of, from Grenfell but I think it’s important we all speak out and keep talking. It’s the only way we’re ever going to see change. Campaigners, Grenfell United are calling for all dangerous cladding to be removed and safe fire doors, sprinklers and clear fire escapes to be installed in all blocks – is that really too much to ask for?

Residents of 12 tower blocks in Manchester are planning to sue the government for failing to protect them from fire amid rising frustration that thousands of people are still living in dangerous homes. Ministers have promised £600m to fund the removal of the type of combustible cladding that spread the fire at Grenfell, but checks since the tragedy have identified many high-rise blocks with other faults including wooden cladding and missing fire breaks, for which no public funding is yet being offered.

The government announced a ban on combustible materials for new buildings in June last year but the ban is limited only to buildings over 18m tall, meaning there is nothing in place to stop the same cladding used in Grenfell from being used in a five-story care home or building, which is terrifying.

I know that so much work has already been done and over the years Newcastle City Council alone has spent over £9m on fire doors and other fire safety measures, but if we still have buildings without fire doors then I personally don’t think enough has been done. We’ve got to keep talking about Grenfell, it’s the only way we’re ever going to see the change that is needed.

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk.

What’s wrong with retention in construction?

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

This week, the new construction minister, Andrew Stephenson, supported a crackdown on poor payment, saying that the government needs to look at restricting the use of retention.

Retentions are when an agreed percentage of payment is withheld from the contractor. The money builds throughout the project and half of the retention is usually paid on completion, with the remaining balance being paid 12 months later when any defects have been corrected. Retentions give the employer security and encourages the contractor to rectify any problems. However, for years there have been concerns over the misuse of retentions, which has had a huge impact mostly on smaller firms.

A delay in payment means the smaller firms down the project chain suffer, as they have to wait even longer to be paid. Retentions restrict cashflow and lead to a waste in valuable resource and time, often spent chasing for payments – all of which can result in a business becoming insolvent. It’s not fair that the smaller firms are penalised for being a small but that’s what tends to happen – the smaller the firm, the harder it is hit.

Earlier in the year things were finally looking up for the smaller businesses. The government announced that from September, firms that don’t pay at least 95% of undisputed invoices within 60 days face being barred from public sector contracts worth more than £5m, this will ensure the government only does business with companies who pay their suppliers on time, many of which are small businesses – finally a step in the right direction, but is it enough?

Last week at our Construction Leadership event, Andy Mitchell, co-chair of the Construction Leadership Council also stressed that the industry needs to stand up and tell the government how they can support the industry and that includes clamping down on retention clauses and fair payment. The change in payment practices goes beyond reducing the payment time, we need to be naming and shaming those who aren’t paying on time and holding them to account for what they’re doing to the industry and supply chain. There is currently no requirement for the retention fund to be protected, so if the holder of the fund becomes insolvent then the money becomes part of a general pot of money available to creditors. The lack of protection has affected around 44% of contractors who have suffered non-payment over the last three years. When big contractors fail, such as Carillion, there’s a huge knock on effect for most of the industry, with many being businesses at risk of being left out of pocket. We must reduce the likelihood of this happening, so something needs to change.

Finance is a huge problem for our industry and one I don’t think we’ve taken seriously enough in the past. It wouldn’t be accepted in any other industry, so why should ours be any different?

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk.

Intelligent procurement – it can be achieved

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

Everyone knows how hard the industry, particularly the North East, was hit during the recession, when changes to public sector procurement and the creation of single-sourced frameworks resulted in many companies being excluded from tendering, often on turnover alone.

Although frameworks were sold to government as a chance to save money, this approach has since been shown to be flawed in many areas.  Even now, we don’t need to look far to see evidence of misguided procurement practice resulting in companies simply running out of cash. When decision-making is based on lowest cost/minimum regulatory requirements it can be a recipe for disaster, taking no account of future costs.

It was great to see a huge turnout once again at our annual Constructing Excellence Awards. It just shows how much support the industry has, especially here in the North East. Construction Alliance NorthEast has always been a huge supporter of CENE and I am pleased to hear it is making an impact on regional procurement outcomes.

CAN launched in 2016 to primarily address the issues surrounding fairer procurement, it aims to create a more level playing field for regional SME contractors when tendering for public sector work.  Their reasoning is that the more contracts awarded to regional contractors, the better it is for the long-term future of the sector and a more sustainable industry generally. For me, it makes complete sense.

So, when North East Procurement Organisation (NEPO) began working on its documentation for its next Building Construction Works framework a couple of years ago, CAN worked closely with NEPO to ensure that local companies were not filtered out at an early stage in the process. Instead of turnover, they encouraged NEPO to focus on other key areas such as added social value; the creation of different value bands, up to £2m, between £2m-£5m and over £5m – companies only being allowed to bid for either the high or low bands, not both.

One year after the successful bidders were announced, I am delighted to see that out of almost £30m worth of contracts already tendered, local companies have picked up a significant share of the work, including wins by CAN members, Brims and Esh.  Most importantly, regional companies now account for 70% of those on the framework and they are also able to bid for a further £34m of imminent pipeline contracts, plus further work in the future.

 

This all goes to show that when effective collaboration takes place, intelligent procurement results. Thanks to the willingness of NEPO to collaborate and be open to advice, a shift in procurement policy was possible. We need more of this to ensure a healthy construction industry in the North East – it CAN be achieved!

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk.

National Women in Engineering Day

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

National Women in Engineering Day (NWED), which takes place next Sunday, highlights the opportunities available for women in engineering. The event takes place every year on 23 June and aims to raise the profile of women in engineering across the world. It’s your chance to get involved with this year’s theme of #TransformTheFuture.

Even though the engineering industry is now more diverse than ever before, there is still plenty of work to be done to boost female uptake and essentially, Transform the Future. Only 11% of the engineering workforce is female and while I’d love that number to be much higher, it is still an improvement on previous years so things are getting better, just much slower than we would like.

The UK shockingly has the lowest percentage of female engineers in Europe and as it stands, this isn’t set to rise any time soon. The UK needs to significantly increase its number of engineers. The STEM skills shortage is costing businesses £1.5bn in recruitment every year. For the engineering sector to reduce its skills shortage, it needs to employ around 186,000 recruits each year until 2024.

 

There is a clear move towards embracing inclusion and demolishing stereotypes within the industry at the minute. There are initiatives and people are working towards encouraging more women into the industry, but we could and need to be doing more if we’re to get anywhere near getting the recruits the industry needs in the next five years, not to mention the fact that a gender diverse workforce drives innovation and improves business.  We need to make sure we’re promoting the industry to women when they are still at college and encourage them to take STEM subjects is another way forward. The engineering industry is exciting and has so much to offer, so we need to ensure that this message is getting out to schools and to the wider public.

This year we’re celebrating 100 years of the Women’s Engineering Society, a charity and professional network of female engineers, scientists and technologists. The charity supports and inspires women to achieve their goals in the industry, encouraging education and supporting companies with gender diversity and inclusion. That’s 100 years of challenging stereotypes and encouraging women into higher positions; the fight has been going on since long before many of us even realised there was an issue.

With the skills shortage at a high, we’ve realised we’re in no position to be looking at anything other than level of skill and potential when recruiting workers, we need people from all backgrounds. Equality and inclusion should be a priority in every business, and we’re certainly working hard to ensure that this industry is no different.

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk

Investing in our workers

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

The Construction Leadership Council’s (CLC) Skills Workstream last week published its Future Skills Report, urging contractors to hire more employees directly.

According to the report, industry workers do not receive enough training and the best way to tackle this issue is for contractors to hire more people directly. I think we all share the same concerns over the future skills shortage and the report expands on this. Given that 30% of the workforce is set to retire over the next ten years and the end to Freedom of Movement after Brexit is looming, I think it’s only right to be concerned. Thankfully, the report has put forward actions to make sure the industry doesn’t suffer.

The report calls for clients to agree a code of employment where those who contribute to a project are directly employed. That way, it’s in the employer’s best interest to train staff and benefit from their improved productivity. This echoes the 2016 construction strategy report which said the sector suffers from fragmentation, pointing out that 99% of construction businesses are SMEs. This is long overdue. Direct employment not only improves productivity, it reduces accidents and helps ensure workers are trained correctly. This needs to be the beginning of tackling the hire and fire culture which currently distorts the reputation of the industry.

The report also wants smart construction methods to be encouraged through early design and procurement processes, promoting the use of digital technology and advanced manufacturing techniques. This will create the demand for skilled employees which will hopefully drive employers to invest in training appropriate to the emerging skills and construction processes. Industry qualifications and training should be updated to include skills associated with new construction methods. It’s the only way to ensure the workforce and industry is equipped for the future.

It’s no secret that there are a number of challenges facing the industry, many of which will get worse after Brexit, but we need to ensure we’re taking actions and doing all that we can to avoid the skills shortage being so significant in the future.

Research shows that projects with higher levels of direct employment often work better, the workforce is more engaged, and the client tends to be happier with the final product. The industry is changing, we all know that. We’ve accepted new construction methods and are getting to grips with offsite manufacturing. We just need to invest more in our people, ensuring they have the right training to see us through the next decade, which I personally think might be our most challenging yet.

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk.

World Environment Day – climate change and the industry

  By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

Yesterday we celebrated World Environment Day to encourage awareness and action on protecting the environment. Because of what we do, our industry has the potential to cause a lot of damage but that also means we also have huge potential to make a difference on protecting the environment.

 

We are always thinking of new innovative ways of being efficient and we’ve really stepped up our game in the last few years. Offsite construction is now becoming more common, we’ve got PopUp Houses, plastic roads, even a ‘bubble’ building here in Newcastle, all of which are playing a part.

 

Last week, major contractors were among more than 120 business leaders who wrote to the prime minister to urge the government to adopt a target for net-zero greenhouse gas emissions in the UK by 2050. Skanska, Cundall and Willmott Dixon were among those who signed the letter to the PM. The letter highlighted how many companies were adopting more energy efficient practices and setting their own net-zero targets. I think what the letter shows, is that the climate crisis is becoming such an issue that it’s now being discussed in boardrooms with more and more businesses calling for a net zero carbon country. Given that the built environment, including construction and property, contributes 40% of the UK’s carbon footprint, I’m so happy to see so many industry professionals signing this letter.

 

The UK Green Building Council’s new report aims to build a consensus about the actions we need to take, looking at whole-life carbon impacts of both new and existing homes and buildings. Previously, zero carbon policies focused only on operational energy and modelled performance in new buildings, so this is a significant change. However, currently a building’s energy status isn’t based on the materials used during construction and that’s what we need to change. While the aesthetics of a building are still important, we need to consider the materials we’re using and their wider impact. We need more recycled and manufactured materials used in a way that’s environmentally friendly.

Changes are happening. People are finally taking responsibility in how they work and their efforts to tackle the climate crisis. We’re looking at new building methods, new materials and technologies – all of which can reduce emissions. Skanska has pledged to become a carbon-neutral business by 2045 and other businesses have committed to a net-zero or net-negative carbon pathway. We made history by becoming the first country to introduce a legally binding framework for tackling climate change when The Climate Change Act received royal assent in 2008, I say why stop there?

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk.

What ex-offenders can bring to the industry

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

Government figures show that more than 82,500 people are in prisons across the UK and those who are set for release face re-entering society, getting their life back on track and starting the long, difficult process of looking for a job as an ex-offender.

Encouraging ex-offenders back into work reduces the likelihood of re-offending but it also gives employers access to a pool of talented and motivated individuals. Research shows that only 17% of ex-offenders are in PAYE work a year after prison release. Given that the industry is already struggling with a skills shortage and after Brexit it’s only going to get worse, hiring ex-offenders could solve many of our problems.

Since May 2018 more than 230 businesses have registered to work with prisons and set offenders on a path to employment. This is further to the 300 businesses around the UK including Halfords, Timpson, Virgin, Greggs, Pret a Manger, Boots and Balfour Beatty that are already employing ex-offenders. A few years ago, Esh Group co-ordinated the ‘Chance for Change’ programme. The programme offered 15 prisoners in Deerbolt Young Offenders’ Institution at Barnard Castle the opportunity to develop a range of skills prior to their release in a bid to stop them going back to a life of crime. The inmates took part in weekly workshops each led by managers from those businesses taking part in the project. They focused on issues such as the skills, attitude and behaviour important in the workplace, managing finances and living independently and personal responsibility. An important feature of the programme was the opportunity for some of the young men involved to be Released on Temporary Licence (ROTL), making it possible for them to go out of the prison on work experience.

Just last week, a new construction academy inside HMP Leeds was launched, training prisoners towards level one national vocational qualifications including bricklaying, tiling, carpentry and joinery. Kier are one of the first construction companies to support the initiative but I hope many others will follow suit.

There are plenty of programmes now to help get prisoners back into work and I’m so glad the industry is playing its part. By expanding the use of ROTL for work and broadening access to training and work opportunities for prisoners we can work towards steering them away from a life of crime and towards a new life with a stable job and new skills under their belt. Not to mention, they will be filling the skills gaps and the workers shortage that is only expected to get worse – it really is a win-win situation for all involved.

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk.

Why you shouldn’t overlook the North East

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

Our region might have fewer big projects than those down South and we certainly get less attention than those big-money schemes but that’s not to say we should be overlooked. We might be small and have faced (and overcome) many obstacles, but we still have plenty to shout about and there are many reasons to feel optimistic about the future of construction in the North East.

We’ve worked hard over the years to get the industry to where it is now. We’ve employed methods and models to support new housing delivery, using council-owned land and assets and innovative funding models.  We’ve seen the rejuvenation of Newcastle’s West End through a £265m investment designed to address growing housing needs by building energy-efficient homes using sustainable materials within a sustainable community. A public-private joint venture at Ouseburn Quarter to develop new mixed tenure homes across brownfield sites will also lever in £57m of private sector funding to develop a new residential community – the perfect mix of small businesses from creative industries, pubs, eateries and music venues.

Newcastle Helix, the £350m flagship project brought together the public sector, academia, communities, business and industry and created around 4,000 jobs. The building and its surroundings are themselves experiments that use micro-metering to provide detailed, real time performance data. This will be used to inform the future design of building services, materials selection, urban drainage, energy systems and infrastructure. It’s a perfect example of sustainable urban development combining commercial and residential space with research and education facilities. I’m so proud that something like this was created in the North East.

There have also been new plans submitted for a £250 million urban village to be built on the former Calders site. The development hopes to deliver an urban village consisting of 1,500 residential properties, a hotel and commercial and leisure space. The site has been neglected now for 20 years and the regeneration scheme is set to redevelop the area between Central Station and the Quayside, creating up to 1000 jobs in the process.

These examples all showcase the North East’s ability and the great things we can and have achieved. Given that we’re smaller, receive less attention and funding than elsewhere in the country, we often have to come up with our own solutions and work together to make the North East somewhere people want to live and work and I personally think we do that very well. I’m proud of what we’ve achieved, in terms of housing, innovation and driving digitalisation and am more than confident we can deal with whatever Brexit issues come our way in the coming months.

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk

A new procurement era ahead?

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

Unless you’ve been holidaying in some far-flung place in the past few weeks, you’ll know that the vacancy for the North of Tyne Mayor has been filled and Jamie Driscoll is now in office.  A key part of the mayor’s manifesto is to enable small businesses to win public sector work.

That very subject was the catalyst for the formation of Construction Alliance North East (CAN) in 2016. Since then, CAN has garnered support from many local MPs and industry bodies such as the Construction Industry Council and in 2018 successfully supported NEPO to develop its £300m Building Construction Works framework which resulted in a number of local companies being appointed.

The new mayor hopes to improve opportunities for small businesses by ‘creating a procurement framework to level the playing field for local businesses and keep those profits here. As well as encourage local public services such as council, hospital and universities to join this framework.’ He will also be building on the pioneering approach of Preston by working with employers to ensure that they prioritise local small businesses and local employment when procuring supplies and services. Since changing its procurement approach back in 2013, Preston has increased public sector spend in the city from 5% to an impressive 18%, returning in excess of £275m to the local economy and reducing unemployment from 6.5% to 3.5%. CAN firmly believes that by adopting a considered approach to public sector procurement, which ensures that tendering opportunities are structured in such a way to include rather than preclude regional SMEs, there is no reason why the North East cannot benefit in the same way that areas such as Preston have.

As the leading voice for SME contractors in the region, CAN is very much looking forward to working with the mayor’s office to provide guidance and support to help shape the procurement framework at such an exciting time for the region. However, whether using new or existing frameworks, CAN feels strongly that the following recommendations should be implemented.  Frameworks should recognise the specialisms and expertise of SME’s and should be based around a clear valued work bank with a commitment from clients to deliver work via the framework.  The number of companies on the framework should be proportionate to the framework value and the time and cost of the selection process should be reduced substantially.  Also, frameworks must encourage the use of the Social Value Act and promote better monitoring of contract performance ensuring fair treatment of all suppliers.

CAN is the main sponsor for Constructing Excellence North East’s ‘Procuring for Value’ event taking place on 13 June at The Grand Gosforth Park Hotel.  The event will look at what the Procuring for Value workstream is, how it will operate and the opportunities it will create for the industry and the region.

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk.

Why the next 10 years are important for climate change

By Catriona Lingwood, Chief Executive of Constructing Excellence in the North East

We work in one of the biggest industries in the world, and because of what we do, we have the most potential to make a difference on protecting the environment. One of the biggest differences that can be made lies within our industry, in house-building.

The Climate Change Act, the first legally binding framework for tackling climate change, was introduced back in 2008. It sets legally binding targets, creates new powers, changes the institutional framework, establishes systems to ensure accountability and addresses resilience to climate change. It is most notably known for the commitment to cut emissions of greenhouse gasses by at least 34% by 2020 and by 80% by 2050 compared with 1990 levels – something we’ve all been slowly working towards.

Last week, the Committee on Climate Change responded to a government request to reassess the UK’s long-term emissions targets. The published report suggested the UK can end its contribution to global warming by setting a target to reduce greenhouse gas emissions to zero by 2050, which will require outstanding levels of energy efficiency alongside zero carbon electricity and heat supplies. The target referred to as ‘net zero’ would be met by some sources of emissions being offset by removal of CO2 from the atmosphere.

The report suggests that foundations are in place to implement the policy throughout the UK. A net-zero target will deliver on the commitment that the UK made by signing the Paris Agreement. It is achievable with known technologies within the expected economic cost that Parliament accepted when it legislated the existing 2050 target for an 80% reduction from 1990. However, this is only possible if credible, well designed policies are ramped up significantly. I feel like this is a positive step forward for climate change and it shows that people are finally taking it seriously. We all need to take responsibility in our own lives to tackle climate change, especially in our efforts to achieving net zero emissions by 2050 and our industry has a big role to play in that.

The government welcomed the report but has yet to accept the recommendations. We need to make the changes and start delivering them as soon as possible, the sooner the better if you ask me. According to reports, the industry has just over 10 years to make sure all new buildings are net zero carbon by 2030 – given how quick the last 10 years of the Climate Change Act has gone it will be here before we know it.

For more information on Constructing Excellence in the North East, please contact chief executive, Catriona Lingwood, on 0191 500 7880 or email catriona@cene.org.uk