23rd December Journal Column

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

It’s that time of year again when everywhere you look there are reviews of the last 12 months and predictions of what we can expect from the year ahead. If I had to summarise what 2016 was like for our industry, I would say two things- amazing, but bloomin’ hard work!
A new year is a natural point in time to stop, assess how things have gone over the past 12 months, look at everything that we’ve achieved and look at what we can do better in the coming year. The end of 2016 marks the end of the industry as we know it, for good or bad we don’t know yet, but what’s certain is that the industry will definitely change over the next few years- in the words of our new Prime Minister Theresa May ‘change is going to come’.

It’s certainly been a year for reviews and changes. This year, Homes and Communities Agency (HCA) came under review to look at how they can deliver the homes the country needs. It was agreed that there’ll be a review and total reform of the Construction Industry Training Board (CITB). April saw the collaborative use of BIM Level 2 in all government procured buildings become mandatory, not to mention the end of the Budget update and the Autumn Statement as we know it. It really has been all systems go!

Probably the biggest thing to come out of 2016 is Britain’s decision to exit the European Union, the impact of which we are still unsure of. Currently, the impact of the Brexit decision hasn’t really been felt, but that’s all going to change next year as we prepare to leave the EU. This is a move that could take six years, so we’re just at the start of what I expect will be a very long and demanding journey.

As well as the industry, we at Constructing Excellence in the North East (CENE) have had a very eventful year. We’ve had a very full Continuing Professional Development (CPD) calendar, which has seen us go up and down the country for events and awards. We’ve had the Constructing Excellence Awards, both Regional and National, and the first Generation 4 Change Awards, celebrating young professionals in the industry – something we are always more than happy to do.

There are so many other things that I could mention as it’s certainly been a busy year, but I don’t want to keep you away from your festivities for too long! So, based on that, there’s just one thing left for me to say, from all of us at Constructing Excellence in the North East, we wish you a very Merry Christmas and a happy and prosperous 2017.

16th December Journal Column

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

Last month, the government published a wide-ranging review of the Homes and Communities Agency (HCA) that aims to help improve its efficiency and provide greater focus to its housebuilding work.

The review stated that the agency must have a clear principal objective of delivering housing. Going forward, it will need to remain a delivery agent for essential government programmes but should take a broad approach, using its expertise, land and investment to facilitate and maximise housebuilding. The review recommended the organisation needs to it become more active in the land market, to enter and shape new markets through Accelerated Construction, and to drive delivery of new products such as Shared Ownership and starter homes. The review concluded that the agency should ‘continue in its current form as a public body, but with a renewed and revitalised purpose of supporting housebuilding and increasing the supply of available land’. To achieve this purpose, the review recommended that the agency’s social housing regulation function should become a separate public body altogether. However, they have stated that this is merely an administrative change and will not affect the regulators powers or operations.

Currently, the HCA holds a dual role, as the regulator of registered social housing providers in England and the national housing, land and regeneration agency. The review didn’t criticise the agency, in fact it said that the agency was mostly working well, but suggested that the social housing regulation function become a separate public body only to remove the potential for conflicts of interest. This will allow for a stronger focus on the HCA’s primary objectives of housing delivery, regeneration, growth and devolution. For me, it’s a smart and necessary move, it’s best to avoid conflicts of interest altogether and not put yourself in that position.

The review was carried out between February and April as part of a wider programme of government activity to scrutinise the effectiveness and efficiency of public bodies. Improvements will also be made to the agency’s partnership working, with an additional emphasis on reducing bureaucracy and ensuring staff have the right set of skills for the future.The HCA Regulation Committee has welcomed the government’s decision to separate the regulator from the HCA, admitting it will strengthen their ability to promote a viable, efficient and well-governed social housing sector able to deliver homes that meet a range of needs.

Gavin Barwell, housing minister, said: “We are determined to create a housing market that works for everyone and the Homes and Communities Agency and regulator will play an important role in delivering the homes this country needs” – and I don’t think we can ask for much more than that!

9th December Journal Column

By Richard Waterhouse, Chief Executive of NBS

It’s safe to say that the effects of the Brexit decision are still unfolding. Industry forecasts, like those produced by the Construction Products Association and Experian, suggest that whilst we are not heading for a recession, construction output has significantly diminished following the Brexit decision. But it seems uncertainty, rather than speculation about the ultimate form Brexit takes, is the root cause.
Current projections suggest that even though the economy is performing better than expected right now, the referendum result will be a downward pressure for at least the next two to three years.

Those who design buildings are often good predictors of what will happen to the broader construction industry. This is because design work is the earliest work; so, if it tails off, in time, so will construction output.
NBS wanted to understand the views of the design community and the results of our latest survey show how the industry is feeling after the Brexit decision. The survey, which we last ran in June and July found that the design community follow a pattern we have seen elsewhere; a sudden and pronounced dip immediately following the referendum result, followed by a bounce back.

Predictions for practices’ workloads have markedly improved. In July, only seven per cent felt their workloads would increase in the coming 12 months. That figure has risen to nearly a quarter (24 per cent), – the same number of those who expect a decrease. Yet, 42 percent anticipate no change at all.

The latest figures around projected staffing levels are more stable than those in July. A quarter anticipate staffing levels falling in the next 12 months. Yet 19 per cent foresee growth, compared with only five percent in July. Almost half predict no change in their staffing levels, no growth or the increased output that we desperately need, but also no falls- so we can’t really complain just yet.
Designers are now less negative than they were immediately after the decision. The number expecting the industry to shrink is still high, at 44 per cent, but that has fallen a lot from 61 per cent. Whilst people are less pessimistic about the year to come, the immediate effects of the Brexit decision are being increasingly felt. Back in July, one in five had had a project cancelled, that figure has now risen to a quarter. Of those who have had projects cancelled or put on hold, those projects account for, on average, 21 per cent of current projects. That said, seven per cent have had projects re-instated that were put on hold after the referendum result, so we might be down, but we’re certainly not out!

When reading people’s comments, there remains a significant, and at times heartfelt, divide between those who favour our leaving the EU and those who do not. But we are also beginning to see a more rounded assessment of the future, which is what we’ve wanted since the decision was announced, nobody likes the fear of the unknown especially when the industry is at stake. All we do know is that we will be leaving the EU, but what form that exit takes is unclear and very important. The next few years will be very interesting to say the least.

2nd December Journal Column

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

Last week, chancellor Philip Hammond made his first (and last) Autumn Statement and announced a lot of positive things for our industry. Housing and construction companies have welcomed his announcement which sets out new funding for affordable housing and infrastructure amongst other things.
The government have pledged to spend £2.3bn on civil engineering infrastructure work like local roads, which will support the delivery of up to 10,000 new homes where they are needed most.

A further £1.4bn will be provided to deliver 40,000 new affordable homes – a necessary response to the fact that the number of affordable homes in England fell last year to the lowest level in 24 years. The news has been welcomed by housing professionals, particularly Mark Farmer who authored the Farmer Review earlier in the year, who recommended that the government increased commitment to the National Affordable Homes Programme.
The National Housing Federation (NHF)have welcomed the announcement after calling on the government to relax restrictions on existing affordable housing funding for quite some time. Increased flexibility and extra investment will give the freedom and confidence to build more affordable homes, including those for rent, more quickly across the country.

The chancellor said between 1 per cent and 1.2 per cent of Gross Domestic Profit (GDP) will be invested every year from 2020 in economic infrastructure, which is broken down into the likes of transport, energy, flood defences, water, waste and digital communications, which might explain why there was no mention of any specifics- so let’s hope it’s invested exactly where it’s needed.
A ratio of 1 per cent-1.2 per cent compares to 0.8 per cent of GDP that is being spent currently, so it does sound promising, but four years is a long time to wait.

The housing sector has had a promising couple of months, and it will be interesting to hear expert opinions on how the government plans to tackle the housing crisis at the big housing debate. The debate, taking place throughout next week will give an up-to-date picture of the challenges facing the sector and what’s in store for the future, particularly after the government announcements.

While it all sounds positive, especially for housing, I was disappointed not to see any mention of investments in training and apprenticeships considering the number of skills shortage issues the industry is still struggling with. It would have been reassuring to see that a plan is in place to look at training and re-training people in the UK to prepare for any restrictions we may face when the impact of Brexit comes into play, but fingers crossed that comes next year – we need it sooner rather than later.

The statement didn’t feature anything that is going to impact us immediately, it featured a lot of small initiatives and big promises that will take a few years for changes to happen, so for now it’s a lot of waiting around and going about business as usual as we wait for initiatives to come into place – 2017 really is going to be an eventful year.