INSIGHT: The construction industry can flourish – but it needs stability

“Maintaining stability across the sector’s pipeline of projects is the single biggest factor to enable us to enhance productivity, invest in skills and innovation and ultimately deliver growth for the economy and the infrastructure and housing the UK needs,” the Mace group chairman wrote this week in a letter to Jeremy Hunt, chancellor of the exchequer. 

Housing decline 

To counter a ‘rapid decline’ in UK house building in part brought about by planning delays, changes in the economy, nutrient neutrality requirements, and reforms to the National Planning Policy Framework (NPPF), potentially resulting in net losses of more than £20 billion, Reynolds urged the following recommendations: 

• Ensure plans to increase planning fees mean greater resources for planning departments. 
• A presumption in favour of up to 25 homes on brownfield land for SMEs.  
• Sufficient funding for building and product safety regulatory bodies. 
• Encourage Build to Rent to relieve pressure on the private rental market. 
• Increase subsidies for affordable housing by up to £14 billion to incentivise private finance. 

“House building levels could return to levels last seen in the aftermath of the global financial crisis and are forecast to deteriorate further next year,” Reynolds warned. 

Infrastructure clarity 

Industry must have reasonable foresight on major public infrastructure plans – such as Network North and HS2 – including scope and delivery, so it can properly manage time, capital and resources, thereby reducing potential net risk to contractors, Reynolds urged. Actions could include: 

• Timely publishing of the updated deliverable Infrastructure and Construction pipeline. 
• Acknowledging “the increase in investment the country needs”, including through private finance.  

To enhance productivity, The Construction Playbook, which sets out how public works projects and programmes should be assessed, procured and delivered, should also be followed “consistently”, he said.  

“The CLC are frequently seeing the principles of The Construction Playbook ignored in practice, for example unlimited insurance liability on contracts,” he wrote.  

“It would be useful if contracts were audited by HMT during the Business Case approval process for consistency with The Construction Playbook.” 

Retrofit shakeup 

To safeguard and support SMEs performing retrofit work in the privately owned housing market, Reynolds urged the following: 

• Using the Net Zero Carbon Buildings Standard for consistency, to attract investment and give industry confidence to invest.  
• Set out a 10-year policy and regulatory roadmap for different segments of the market, including new measures for key workers and pensioners. 

To read the letter in full, click here.  

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