Construction overview

According to Barbour ABI data, the total value of construction contract awards in June was £2.2 billion based on a three month rolling average.

Compared to May 2020, this is a decrease of 9.2% and is also 57.3% lower than June 2019 (see fig. 2.1). Data for Q2 2020 shows that total construction contract awards are valued at £9.2 billion. This is 51.3% lower than Q1 and also 40.5% lower than for Q2 2019. However, the raw monthly data for June is positive with value increasing by 98% compared with May.

In terms of contract award numbers, June 2020 was positive with 81.4% increase to 477 compared with just 263 in May. Whilst the three month average data is still influenced by the significant decrease in April, the raw monthly data and the increase in contract numbers in June are beginning to signal improving conditions.

Project by region

Regional analysis shows that London had the largest share of contract awards in June at 26.1%. The South East was in second place with attributable share of 16.4% of awards and was followed by the North West in third place with 13.6% of contract awards. Wales was again the smallest region with just 1.4% of awards (see fig. 2.3).

Three contract awards were vying for top award status in June and were all valued at £150 million. In Crawley, the Gatwick Airport Station refurbishment project will see Costain Group extend the existing concourse as well as provide extra platforms. This 36 month project is due to be completed in April 2023. In Manchester, the City View Development – Regent Plaza involves the building of 525 residential units in a 26 storey building. This 40 month project is due for completion in Q3 2023 and was awarded to Helix Contracting. Located in Milton Keynes the Santander New Tech Hub Campus is the new eight storey UK headquarters building for the bank. Awarded to John Sisk & Son the project is due for completion in Q1 2023.

Types of project

Attracting 33.9% of all construction contract awards the residential sector retained lead status in June. The second largest sector this month was infrastructure which accounted for an 18.7% share of awards.

Commercial & retail was the third largest sector in June accounting for 16.0% of awards. Apart from City View Development Regent Plaza, other notable residential awards this month included the former Lea Castle Hospital Development in the West Midlands valued at £60 million which will provide 600 units. Renewable energy generation featured heavily in infrastructure awards this month including the £75 million 75.5MW Aikengall 11a Wind Farm in the Scottish borders.  Within the commercial & retail sector a notable mixed use project was the Tri Sail Towers development in Bishop Stortford valued at £19 million.

The report identifies that, in the commercial and retail sector, MACE and ISG were the leading way in terms of value of contract awarded, McAleer & Rushe Ltd and Willmott Dixon top the table for, Hotel, Leisure and Sport; Balfour Beatty and Integrated Health Projects were the most successful in the Medical and Health sector and Morgan Sindall and Kier for Education.

To see the full report and detailed analysis of the Residential, Commercial and Retail, Hotel, Leisure and Sport, Industrial, Medical and Health and Education Markets including details of key clients, architects and contractors click here.

The Construction Industry Joint Council (CIJC) Working Rule Agreement, its pay and conditions, would normally have been reviewed at the end of June 2020.  In April 2020, all parties to the Agreement agreed to postpone the start of any review discussions, given the Covid-19 emergency and the unprecedented effects this was having on employers, operatives, the industry and across the UK.

Whilst work on many construction sites is restarting, the overall impact on the construction industry remains variable in different parts of the country.  As a result, the member trade associations of the CIJC representing employees covered by the CIJC have decided, this week,  to extend the postponement of pay negotiations until September, when a further assessment will be undertaken. This decision has not been supported by the trade unions and we await their formal response.

Parties to the CIJC Working Rule Agreement remain in regular contact to monitor progress as the industry moves forwards from the emergency to better understand any ongoing impact on employers, operatives and the industry.  In the meantime, all rates and allowances as detailed in the CIJC Agreement dated 1 August 2018 will continue to apply.

Visit our Employment Hub for more information

As part of the easing of lock down restrictions, people may now use public transport in England for any journey, although they are still being encouraged to consider alternative means of transport where possible. Face coverings are mandatory on public transport in England and travellers should maintain social distancing where possible.

Transport for London (TfL) continues to encourage people to avoid using the network during peak times (05:45 ‐ 08:15 and 16:00 ‐ 17:30) and has published a construction toolkit with guidance for businesses in our sector.

Advice supports employers and is designed to “support your workers to help get them and the rest of London moving and working again, as safely and sustainably as possible”.

You can download the Transport for London briefing for the construction sector here

The guidance Approved Document M (access to and use of buildings), volume two, 2015 has been amended following a consultation the provision of Changing Places toilets on the 12 May 2019 which ran for a period of 10 weeks, ending on 22 July 2019, but was then reopened for targeted consultation of sectors most likely to be affected in February 2020 using the same questions.

The guidance in paragraphs 5.6 and 5.7 has been amended to mandate for the provision of changing places toilets within appropriately sized, publicly accessible buildings. The provision states that changing places toilets should be provided in the following buildings types:

1. Assembly, recreation and entertainment buildings (see note) with a capacity for 350 or more people. Or a collection of smaller buildings associated with a site used for assembly, recreation or entertainment such as: zoos, theme parks and venues for sport and exhibitions with a capacity of 2000 people or more
2. Shopping centres/malls or retail parks with a gross floor area of 30,000 m2 or more
3. Retail premises with a gross floor area of 2500m2 or more
4. Sport and leisure buildings with a gross floor area over 5000m2
5. Hospitals and primary care centres
6. Crematoria and cemetery buildings.

Note: Places of assembly, recreation and entertainment can be defined as buildings such as amusement arcades; art galleries; cinemas; concert halls; conference centres; further education colleges; hotels that provide function, sport or leisure facilities; libraries open to the public; motorway service areas; museums; places of worship; theatres; university buildings open to the public.

Clarification is also provided on how the capacities should be derived in these buildings.  The amendments also state that further guidance on layout and equipment is available from the changing places consortium campaign website and by reference to guidance in section 18.6, diagram 48 as well as Annexes F and G of BS 8300-2:2018.

Transitional arrangement

The changes in the amendment booklet take effect on 1st January 2021. The amendments do not apply in any case where a building notice or an initial notice has been given to, or full plans deposited with, a local authority and either the building work to which it relates has

(a) Started before that day; or
(b) by 1 March 2021

Full copy of the amendments document is available here.

This needs to be read in context with the current Approved Document M.