The Construction Leadership Council was created with a remit to drive improvement within the construction sector. Since its creation, it has worked to encourage collaboration to build a better industry, and to act as a bridge between the public and private sectors in pursuit of this objective. The challenge of responding to the Covid19 pandemic has emphasised the importance of this, and the necessity of creating a more robust and sustainable industry which can build back better as the UK enters the period of recovery. This is why the CLC, through its own members and also through its wider links with the industry, has collaborated and supported the combined efforts of the Cabinet Office and Infrastructure & Projects Authority, with input from across the public sector, to develop and publish the Construction Playbook, and to endorse its aim of creating a more strategic relationship between Government and the construction sector.

Government Departments, other public bodies and the wider public sector represent key construction clients, investing in nationally significant infrastructure projects, capital programmes such as those in education and healthcare, projects that improve our cities and towns, and supporting the delivery of new homes. This spectrum of activity across the sector means the public sector has the potential to drive industry transformation, and how it approaches the development and delivery of construction can provide a powerful impetus for changes in industry practice and culture that extends beyond the projects it funds directly.

That is why the publication of the Construction Playbook is significant. It aims to embed a new approach to the procurement and delivery of construction projects and programmes, which is more collaborative, engages the whole supply chain, encourages investment in innovation and skills, and supports a more sustainable, resilient and profitable industry, capable of delivering higher-quality, safer and better performing built assets for its clients. It will create the foundation for a new approach to construction, where we can utilise digital and offsite manufacturing technologies to increase the capability of the industry, and accelerate the delivery of built assets.

It will also aim to deliver a better and fairer industry, with stronger and more open relationships between the industry and its clients, fewer disputes, and more equitable contractual terms, that ensure prompt and fair payment and a balanced allocation of risk, where these are managed by the organisation best placed to do so. Finally, it will help ensure that investment in construction projects creates the greatest economic, social and environmental value possible, and contributes to the delivery of strategic policy objectives such as our legal obligation to achieve net zero carbon by 2050 and levelling up across the UK.

These goals are our goals at the CLC. We share the Government’s desire to improve performance through new ways of working. But publishing the Playbook is just the first step in the process. For real change to happen, it is important that both Government and the industry embed the principles of the new approach, and invest in their capability to deliver this. The Government will be working to implement this across all central government Departments and public bodies, and mandating the adoption of this approach whilst recognising there is no-one-size-fits all approach to delivery. The CLC will work with organisations across the industry to ensure that this effort is matched, and that the public and private sectors can support each other in this shared endeavour.

 

 

Andy Mitchell
Co-Chair
Construction Leadership Council

Brexit looms, a deal remains elusive and we continue to be inundated by messages from the Secretary of State and various government departments to, “get ready”, but there remain some real challenges and uncertainty.  There are some practical things you can do, but “Get ready” may mean in some cases “brace yourself and be prepared to flex fast”.  At FIS we have produced the Risk Assessment Toolkit and continue to run webinars on key issues (next is the 10th December at Midday).  Here we look at three of the big issues impacting the Finishes and Interiors Sector.

ISSUE 1: People (The Points Based Immigration System)

The new points-based system means there is additional cost to bring workers in, even if you can get to the 70 points required, which is very difficult for most occupations in our sector.

The Home Office have not, in the opinion of FIS, adequately considered the COVID effect when applying the Points Based Immigration System.  It is creating a real concern on three levels.  Firstly many skilled workers have left the UK due to COVID and a combination of currency fluctuation and work at competitive rates in or near their home country means that they do not now intend to return.  Across the sector we employ around 175,000 people, circa 40% of all workers are from the EU and according to the ONS the number of these workers available has declined by 40% to Q3 2020.  The Home Office have not adequately taken this into account when appraising the shortage occupation list.  Secondly they are relying on out-dated Standard Occupational Codes (2010 as opposed to 2020) with no granularity applied to the occupational areas included in “other” categories.   As a consequence, trades such as ceiling fixing and drylining have been classified wrongly as semi-skilled.  Finally the system fails to recognise and guidance is not forthcoming about workers employed through the Construction Industry Scheme (CIS), via agencies and through umbrellas, the tax system recognises the need for a contingent workforce in construction, the immigration system does not.

Whilst we had been reassured that the Points Based System was designed to be flexible, a recent meeting with the Home Office advised that no change is likely until 2022.  We are optimistic that we can increase our trainee and apprenticeship programmes, BUT we need time to train (e.g. 18 months to train a dryliner).  A drive to employment seems to be motivating Government, but this requires a radical rethink of procurement practices in construction.  In the interim this leaves us with the potential of a shortfall in labour that could inflate rates, delay programmes and projects starts and could even make it difficult to fulfil existing contracts.

The solution must be to look at phasing the changes in over a longer period, allowing applications for pre-settled status to run into next year.  We can then work with the Migration Advisory Committee to understand the impact and how we can progressively tighten the immigration process together, controlling flow of workers at the same time as improving the training infrastructure. The alternative is huge uncertainty and business failures damaging our ability to adapt as a sector.  This will in turn impact the nations home building and infrastructure programmes and constrain the potential of construction for the UK economy.

FIS continues to lobby on behalf of our community here, but if you are impacted, we have prepared a template letter that you can use to contact your MP.  To receive a copy of this template, simply email iainmcilwee@thefis.org

You can access a further details and advice on the Points Based Immigration System Here.

ISSUE 2: Product (Movement and Marking)

For many who already export or import products, change will largely mean a bit more admin, tariffs and communication to reassure your clients.  If you are already trading internationally, then it should be relatively straightforward.  

First time importers and exporters (i.e. those that have not previously purchased product or sold product from outside the EU) you will need to add some new processes, make sure they understand the product marking and consider tax implications and any tarriffs, but beyond a bit of bureaucracy it should be manageable.  We have had questions raised as to whether UK Test Standards will still be applicable for export – realistically there should be no change if Building Regulations or Codes in the respective country are not altered to remove reference.

However, there is a big BUT…. 

If your products are currently subject to the Construction Products Regulation and rely on CE marking then it may not be so straightforward.   Whilst there is a 12-month transition (to January 2022) before UKCA and UK NI marks become mandatory, as far as the EU is concerned all UK notified bodies lose their status to issue CE Marking Certificates from midnight on the 31^st December 2020.  Exporters need to be working now with their notified body (or notified test laboratories) about transfer of certificates to European Notified Bodies and validity of evidence for ongoing CE Marking if declaring using The Assessment and Verification of Constancy of Performance (AVCP) System Level 3 (e.g. Gypsum Products, Flooring and Internal and external wall and ceiling finishes) .  

The impact goes beyond exporters, this EU Commission stance means than any Declaration of Performance (to support CE Marking) that relies on Engineered Technical Assessments (ETAs) from a UK Notified Body or where CE marking declarations is made using AVCP System Level 3 and where Tests have been conducted in a UK Notified Laboratory, will be invalidated from 1^st January 2021.   Government has confirmed that, if you cannot switch to an EU Notified body to continue CE Marking, you will be expected to start UKCA Marking with immediate effect from 1st January 2021. 

Above applies to all supplying the GB market from 1st January 2021 (regardless of whether you are an importer, exporter or domestic manufacturer).  UK Approved Bodies will be allowed to issue the UKCA mark from 1^st January 2021, but the legal structure is not yet in place and concerns are mounting that it may not be in time.   Time is running away to manage the associated logistics of stamping or labelling products, uploading and replacing declarations of performance and updating manuals/marketing literature and packaging.

A question therefore remains what to do if you cannot maintain your old CE certificate (due to the status of your notified body) and UK Approval Bodies are not ready to issue a UKCA certificate to allow the UK company to operate legally?   Government Guidance on UKCA confirms that “in some cases you will need to apply the new UKCA marking to goods being sold in Great Britain immediately from 1 January 2021”.  It is important to remember that the entity “placing the product” on the market will have responsibility here.  

As well as what to put on the product when you make it, you must also consider stock and  if you have manufactured for stock that has not yet been “placed on the market” or wish to supply into Northern Ireland (where UK Approved Bodies can play more of a role initially and support the issue of the UK NI mark).  It is also vital to consider if your product is a system or an assembly (a set of discrete components), if the latter, you will need to consider the CE marking of each individual item.

BREXIT: CLC Guide to Conformity Marking of Construction Products

Brexit Update: Demystifying Product Marking post Brexit

ISSUE 3: Process (Possible Delays, Costs and Tarriffs)

There are growing concerns around delays at UK ports holding up crucial deliveries. This weekend the Builders Merchant Federation warned that the ports were becoming a “major issue” for its members with products that would normally take one week to clear, taking up to four.

Since September, the country’s biggest container port, Felixstowe, has been handling about 30% more goods than usual, with businesses rushing to replenish stock after the end of lockdowns and building stockpiles before the end of the Brexit transition period.  As a consequence of hold-ups there have even been reports that loads destined for the UK being partially onloaded or dumped at European ports.

According to the BMF the high level of demand has prevented the building trade from stockpiling in the run-up to Brexit.  Shortage areas mentioned include screws, timber, ironmongery, tiles, fixings and electrical products.  A fear is that this could drive further inflation.

Clearly depending on your position in the supply chain, the impact will impact you in different ways, but one thing that is vital is that we must all check our contracts to ensure that any responsibility and impact of delays is not unfairly set as our responsibility.

You can access contractual advice via the FIS Brexit Toolkit here

Ongoing work

FIS will continue to represent your interests through the Construction Leadership Council and with the various Government Departments calling for flexibility and stronger guidance.

In the meantime, we encourage you to visit our Brexit Toolkit here

Our next Brexit Webinar takes place on 10th December at Midday

BREXIT: CLC Guide to Conformity Marking of Construction Products

Blog prepared by Iain McIlwee 8th December 2020, updated on the 10th December (correct to the best of our knowledge at the time of writing!).

Welcome to the 2020 FIS ‘Virtual’ AGM and conference. This is certainly a novel format and I very much hope one of a kind.

2020 has been a year of nightmare scenarios. When I addressed you last year none of us could have predicted the sinister turn that life would take. My business plans, just like yours, are in the bin and I have had to re-evaluate my aspirations for the future.

It was amongst this mayhem that the value of the FIS really crystallised. The whole team ‘stepped up’, took on the challenge and in a matter of weeks produced the Covid-19 Hub. This provided guidance on the maze of procedures that left us confused and anxious. It provided the Risk Management Toolkit and the H&S Taskforce, a group that sprang up overnight and supported by members, provided crucial guidance on site procedures.

There were daily mailshots, twice weekly webinars and most importantly of all, a friendly voice at the end of the phone when you needed moral support and one that could carry our concerns into the wider industry and economic debate – straight to the Construction Leadership Council, Civil Servants and Ministers.

The board also did their bit with weekly meetings and offers of support to members who needed it, I have never been prouder to be a part of that team.  I have also never been prouder to be part of our industry, which has demonstrated incredible resilience, whether building Nightingale hospitals or simply holding our end up in keeping at least some of the economic lights switched on.

I know what it’s like to be a small business owner, swimming in a sea of regulations. I know what it’s like to not be able to afford expensive consultants or accountants to give me regulatory or financial advice. I know what it’s like to sometimes make decisions that I don’t feel qualified to make and bear the responsibility for that. Here’s an amazing statistic for you, nearly 60% of our contractor members turn over less than £5m and in fact only 17% turnover more than £10m and we never forget that statistic. You, like me, need the advice, technical guidance and moral support more than anyone and once again FIS membership pays dividends.  It is these companies that we are targeting our new Business Risk Management Tool that is now available to download from our website.

As well as helping with the day to day, FIS keeps an eye on our future.  The Building Safety Bill will have enormous repercussions for our sector. In response Joe Cilia has collaborated with other leading bodies to produce the guide to ‘Firestopping of Service Penetrations’, a guide that gets to the heart of safety issues in our sector. Another well received publication was the ‘Safe Ingress of Plasterboard’, essential for the prevention of Musculoskeletal disorders so prevalent in our sector.

The training team, hit badly by the withdrawal of CITB funding, has under new leadership in George Swann been working to find ways to continue resourcing the leading work that we have been delivering through the Fit-Out Futures program and set a more standard framework for competence through our sector.  Again vital work.

So we move into the formal part of the day today, the AGM, I hope you have felt the benefit of being part of this amazing community.  At the heart of this, Jane Knight, our Operations Director, who last week celebrated 30 years at the FIS.  This is quite a landmark, congratulations Jane and thank-you for your immense contribution to FIS.

What will 2021 look like. That is our focus for today, building a phoenix from the flames of a pandemic. In January we have Brexit and the repercussions for labour shortages and product certification, The Building Safety Bill, Reverse Charge VAT and that’s just the first quarter. Our headline topics cover some of the biggest issues and discuss how we foster healthy relationships in our supply chain, replace mistrust and combat with cooperation and collaboration and give our sector the best chance of succeeding, with of course the FIS backing us up.   Because above all else,

IT’S ABOUT COMMUNITY… TOGETHER WE ARE STRONGER.

Members can read the minutes of the 2020 Annual General Meeting here.

New data from the FIS indicates that 30% of members are already experiencing labour shortages and 62.5% are concerned for what the New Year brings.  FIS is hosting a workshop on 1st December at Midday with experts to review and advise on how members need to prepare for the new points based system.

In a recent survey FIS asked members a number of key questions around the new points based system.  Concerns are amplified in the larger specialist employers, where 40% were currently experiencing shortages and 74% believe the new system will have a negative impact on their business.  Other interesting data revealed that respondents relied on labour gangs/agencies for an average 11% of the workforce, this again rises for the larger businesses.

FIS CEO, Iain McIlwee stated “The figures presented by Noble Francis at our AGM show that we have already seen an exodus of EU workers and this snap survey has not allayed our concern that we could be facing a real challenge in the New Year.  Clearly the difficulty is that these are unprecedented times and making sense of any data is difficult.  Will COVID restriction soften and ease travel concerns? How hard will Brexit be? What will the impact on currency be here and across Europe? How will this impact rates here and abroad and how attractive will that make UK versus other possible work locations?

We need a crystal ball to know for certain what people, who do not necessarily have deep roots in the UK, might decide to do.  But, when we need the UK to be primed to Build Build Build, the Government have taken an unnecessarily hard line on construction workers, which could come back to bite us by shortening labour supply, impacting programme and driving wage inflation.  More of a staged approach would be better for industry, particularly given the huge dent in training and recruitment activities we have seen in 2020 due to COVID.”

FIS is attending a roundtable on the 4th December with the Home Office and colleagues across construction.  We are still gathering information to feed in, if you wish to feed your views in, please contact iainmcilwee@thefis.org or phone 07792 959481 or you can still add you results to the final survey here.

• A full report from the FIS Research on Immigration is available here (note FIS is keeping this survey open til Thursday 3rd December and if you have not responded we encourage you to add your data).
• For a detailed explanation of the points based system and recommended next steps (including questions to ask your workers) click here
• To book on our Preparing for Brexit: Movement of People Workshop click here

 

The Finishes and Interiors Sector (FIS) has launched a new Business Risk Management Tool to support contractors and help them adopt a structured approach to understanding risk and reducing uncertainty.

Launched at the FIS Virtual AGM and Conference on the 24 November, the Business Risk Management Tool identifies over 120 common risk areas for contractors against the categories including Business Management, Contractual, Financial, Quality, H&S and Procurement,  providing a mechanism to score and rank risk and advice on mitigation and management.

A risk management matrix ranks risk in term of probability of an event occurring and the severity of the impact should the event occur. It can be used to identify and prioritise activity so that a contractor can then make informed business decisions and improve their resilience.

In her AGM speech, FIS President and Operations Director at Tapper Interiors, Helen Tapper stated: “I know what it’s like to not be able to afford expensive consultants or accountants to give me regulatory or financial advice. I know what it’s like to sometimes make decisions that I don’t feel qualified to make and bear the responsibility for that. Here’s an amazing statistic for you, nearly 60% of our contractor members turn over less than £5m and in fact only 17% turnover more than £10m and we never forget that statistic. You, like me, need the advice, technical guidance and moral support more than anyone and once again FIS membership pays dividends. It is these companies that we are targeting our new Business Risk Management Tool that is now available to download from our website.”

Commenting on the launch of the risk management tool, FIS CEO Iain McIlwee said: “We have learned in the past few years that basic risk management in construction needs to improve. Beyond the obvious, the worst thing for any business is getting smacked in the side of the head by something they didn’t see coming on a busy Tuesday afternoon. Our hope is that this risk management tool at least helps protect people from the unknown unknowns.  It is built on the collective wisdom of our community and a tried and tested framework. It isn’t a static thing and we can develop and evolve it as we help members front up to daily problems in the 21^st Century.  We don’t have to learn from our mistakes, we can communicate and collaborate and learn as a community from each other – this way the sector gets better”.

The Risk Management Tool is available to download free for members of the FIS community here – FIS Business Risk Management Tool.

 

The Prime Minister today, 31st October, announced that from Thursday the country would return to National Lockdown in England for a period of 4 weeks.  The lockdown rules announced are less strict than those announced earlier in the year, but will see restrictions in place on non-essential travel and parts of retail and many hospitality and leisure businesses being forced to close.  However, in his speech the Prime Minister confirmed that the Construction and Manufacturing Sector would not be expected to stop working.   He also announced that the Furlough scheme would be extended into December, the Government will once more put in the full 80% of salary (up to the maximum of £2,500), with the employer only covering pension and national insurance contributions..

Lockdown plans will be set before Parliament this week with the intention of commencement on Thursday.

Commenting on the lockdown FIS CEO, Iain McIlwee stated “This is clearly a blow to National morale and will impact the economic recovery that we had started to see, however, at least the Prime Minister name checked construction and manufacturing so we have clarity as a sector about how to proceed and will not return to the uncertainty and chaos that the industry experienced at the outset of the first lockdown.”

You can access resources in the FIS COVID-19 H&S Hub to support social distancing at work and the FIS COVID-19 Hub should you require letters of authorisation to support hotel stays or travel requirements related to construction activities.

A full transcript of the Prime Minister’s speech and accompanying slides are available here.

Devolved Nations

Scotland now has five COVID protection levels in place, ranging from ‘Level 0 ‐ Nearly Normal’ to ‘Level 4 ‐ Lockdown’, and you can check the level for an area by entering the postcode.  

Wales is under its own ‘firebreak’ lockdown until Monday 9 November 00:01am.  Under this “firebreak” that was implemented from Friday 23 October:

• Construction and manufacturing can continue, provided employers take all reasonable measures to mitigate the spread of coronavirus. This includes builders’ merchants, which can remain open.
• In a last minute change to the guidance, work in people’s homes can continue, as long as both the worker and household members have no symptoms of coronavirus. If a member of the household is self‐isolating, works are not recommended except to repair faults posing a direct safety risk.
• All accommodation providers are required to close, unless they are providing ‘specific services’ at the request of the Welsh Government or a local authority. This includes providing emergency accommodation for key workers, which include those responsible for the construction or maintenance of public service buildings.

Northern Ireland In Northern Ireland, a tighter lockdown has been implemented for four weeks, increasing restrictions on travel and gatherings.  Again construction sites are allowed to continue to operate in compliance with social-distancing measures. Border counties in the south such as Donegal, Monaghan and Cavan have seen their level of restrictions increase, meaning only essential workers should go to work; construction has been deemed as ‘essential’ and will be allowed to continue.  These restrictions are in place until Friday 13 November.

In just 71 days there will be guaranteed changes to doing business and there are many actions you can take now to prepare.

Regardless of whether we reach a trade agreement with the EU, from 1 January there will definitely be changes to:

• the way businesses import and export goods
• the process for hiring people from the EU
• the way businesses provide services in EU markets

This week the government is launching a major public information campaign to help firms prepare and keep business moving. It has one simple message: Time is running out, so you need to act now.

Support is available, including sector-specific webinars to walk you through the changes. If you missed our webinars for the Services and Investment, Retail, Automotive, Materials and Metals, Electronics Machinery and Consumer Goods sectors, they are available to watch on demand now.

As Business Secretary I encourage you to:

1. Check what actions you need to take by visiting uk/transition.
2. Sign up for updates.
3. Attend government webinars for additional support, sign up here.

Unless you take action, there is a risk your business operations will be interrupted. You should also check with your suppliers and customers that they are taking action.

I know these are challenging times, but the transition period is ending on 1 January and there will be no extension. It is vital your business prepares for our new relationship with the EU, outside of the single market and customs union. The Government will be there to support and help you to take advantage of the many new opportunities that being an independent trading nation will bring.

Yours sincerely,

Rt Hon Alok Sharma MP

Secretary of State for Business, Energy and Industrial Strategy

Yours sincerely,

Rt Hon Alok Sharma MP
Secretary of State for Business, Energy and Industrial Strategy

• Quick Links to stories and resources related to supporting you prepare for Brexit published on the CLC website
• Find out what you need to do by visiting gov.uk/transition and using the checker tool
• The FIS Preparing for Brexit Toolkit is available here

Additional Brexit Updates from the Department of Business Energy and Industrial Strategy

The updated Border Operating Model provides further detail on how the GB-EU border will work and the actions that traders, hauliers and passengers need to take. These steps will be needed regardless of whether we reach a trade agreement with the EU. The updated GB-EU Border Operating Model:

• Maps out the intended locations of inland border infrastructure. The sites will provide the necessary additional capacity to carry out checks on freight.
• Announces that passports will be required for entry into the UK from October 2021 as the Government phases out the use of EU, EEA and Swiss national identity cards as a valid travel document for entry to the UK.
• Confirms that a Kent Access Permit will be mandatory for HGVs using the short strait channel crossings in Kent. The easy-to-use ‘Check an HGV’ service will allow hauliers to check if they have the correct customs documentation and obtain a Kent Access Permit. A preview demo of the Check and HGV service is available now.

Government launches plans to keep trade flowing after 1 January 2021: The government has announced a series of measures to help keep trade flowing by minimising the risk of disruption at the end of the transition period.

Exporters: sign up for the EU dual-use OGEL: Check now whether your business will need to register for the Open General Export Licence (OGEL), for export of dual-use items to EU member states from 1 January 2021. A full listing of sectors covered, and how to register for the licence with the Export Control Joint Unit is contained in this Notice to Exporters.

HMRC has written to VAT-registered businesses highlighting actions they need to take to prepare for new processes for moving goods between Great Britain and the EU from 1 January 2021.