With two weeks to go until the general election the major political parties have released their manifestos and construction organisations are setting out their wish lists for the incoming government.
Addressing the impact of Brexit, boosting housing and infrastructure investment are the three headline demands. But how do the parties shape up?
Skills and Brexit
What industry is asking for
With nearly 200,000 EU workers in the UK the industry is unanimous in its demand for government to make it a priority to guarantee the status of existing EU nationals currently working in the UK and then, as the CIOB, puts it, “develop a migration system that ensures the industry continues to attract talent from the EU and across the world”.
“Policies must be formulated to ensure construction skills from across the world are accessible without restriction,” says the RICS. “This must be undertaken whilst domestic policies are also implemented to upskill the next generation in the UK.”
The ICE warns of a “self-inflicted skills crisis”. A rapid loss of 200,000 or more would be disastrous for the sector and make projects unaffordable, it says.
Alongside this the industry is looking for government support to help build a sustainable domestic workforce.
What the parties are saying
Despite these pleas, Theresa May and the Conservative Party have set out strict new rules to help slash immigration to the tens of thousands.
The party has stuck to its pledge to reduce net immigration below 100,000 and ignored calls to exclude overseas students from statistics.
If elected the party will “bear down on immigration from outside the EU” across all visa routes, the manifesto says.
The announcement is a sharp blow for the industry, particularly when 17% of the UK’s construction workforce were born outside of the UK.
However, a more practical worry is the announcement that May will change the law to make it more expensive for firms to bring in foreign workers. This could have a significant adverse impact on construction’s reliance on overseas labour, raising already high costs further and putting further pressure on UK training and recruitment.
Under proposed new rules firms will have to pay £2,000 instead of £1,000 to hire non-EU immigrants.
The RICS has raised the issue and says this statement of intent could jeopardise the delivery of all the housing, infrastructure and construction projects the UK badly needs.
“The concern is that such a target will take no account of the need for skilled workers – we must not sacrifice the needs of the UK construction sector for the sake of an arbitrary target,” it says.
The Labour Party’s vision for immigration controls after Brexit is not as harsh as the Tories, but equally worrying, suggesting migration could be controlled by a “tailored mix” of work permits, visas and employer sponsorship.
The Liberal Democrats have said they would make opposition to Brexit a priority and hold another referendum on the final EU exit deal with the option of remaining a member.
Housing
What the industry is asking for
The housing crisis is an ongoing issue with the construction industry calling on all the parties to pledge to increase housebuilding as well as focus on the quality and delivery of newly built homes.
The CIOB has made housing quality one of its main themes, calling on a new government to challenge the industry to build better, by maintaining and improving existing standards. It says any new relationship with the EU and beyond should not be associated with a race to the bottom and focus should be on continued promotion and protection of codes and standards.
Savills’ research department says that any rise in housebuilding from all parties is welcome, but there needs to be 300,000 homes a year being delivered to tackle the massive backlog of undersupply and to have any meaningful impact on housing affordability.
What the parties are offering
Labour’s manifesto reveals an ambition to build more than 100,000 council and housing association homes a year, as well as the creation of a new housing ministry. The manifesto confirmed a pledge to build a million new homes over five years, and raise the borrowing cap on councils.
The last government certainly talked ambitiously about housing – but in the industry’s eyes it’s still to deliver. The National Federation of Builders programme states: “Any new government wishing to deliver more than 200,000 homes every year will need to speed up and simplify planning, tackle the spiraling cost of land, continue improving access to finance, and harness the intrinsic value of SMEs in tackling the skills crisis.”
The Conservatives have stated they plan to extend their one million new homes by 2020 target to a further 500,000 homes by 2022.
The issue of housing quality, one that has hit the headlines, is also a pledge in their programme. It states: “More homes will not mean poor quality homes. For too long, careless developers, high land costs and poor planning have conspired to produce housing developments that do not enhance the lives of those living there.
“We will build better houses, to match the quality of those we have inherited from previous generations. That means supporting high-quality, high-density housing like mansion blocks, mews houses and terraced streets.”
However, doubt has already been brewing about Conservative housing pledges as it was revealed by defence secretary Michael Fallon last week that there was “no new money” for the housing policy, and the party’s plans to build thousands of new homes each year would be paid for out of existing budgets – specifically a £1.4bn fund already set aside for infrastructure spending.
RIBA has welcomed a focus on delivering good quality homes that meet the needs of society. Jane Duncan, president of RIBA, said: “The Conservative manifesto recognises the value of UK architects and the built environment in supporting a better quality of life for people across the country, including through quality of space and design. Our evidence has proven that space standards are vital to ensuring that homes are built to the criteria that people need to live and thrive.”
The Liberal Democrats have also come out promising their own housing reforms. They announced £100bn for housing and infrastructure investment, 300,000 directly funded homes by 2022 and 10 new garden cities.
RIBA has also praised the Lib Dems’ housing target, stating “The aim of building 300,000 more affordable, energy efficient homes, is a welcome recognition of the need to tackle the housing crisis with intelligence, and help reduce energy consumption.”
Infrastructure investment
What industry is asking for
Continued infrastructure investment was also top of most organisations’ wish list for any future government.
The ICE also sees Brexit negotiations as an opportunity to consolidate the UK’s status as an attractive location for infrastructure investment. Ensuring that the Brexit negotiation process does not disrupt this will mean that investors, financiers and developers will continue to have a positive view of the UK, it says.
What the parties are offering
The Conservatives’ pledge is a complete turnaround to their 2015 manifesto – the 2017 document is light on solid infrastructure commitments. It commits to HS2, Northern Powerhouse rail and the expansion of Heathrow Airport, but a pledge to push forward with Crossrail 2 has been dropped.
Where the 2015 Tory manifesto promised “a significant expansion in new nuclear”, May’s 2017 manifesto has no mention of the plans for new nuclear power stations.
The lack of detail for the future of Crossrail 2 is a concern. The Civil Engineering Contractors Association voiced what many in the industry are thinking when it said: “We believe there is scope for the prime minister to do more to provide clarity on major projects that are not named in the manifesto, such as Crossrail 2, the Swansea Bay Tidal Lagoon, and new nuclear power stations. As Britain enters into Brexit negotiations, the next government must ensure that the infrastructure sector thrives in order to drive economic growth.”
Regional investment
What industry is asking for
Ramped up investment in regional areas as well as an equal distribution across the country has also been embraced as a policy among much of the industry.
The CIOB states that in key regions, the government should seek to promote “clusters” of construction-related businesses, like science parks, each to act as a hub for excellence to stimulate innovation, create greater opportunities for networking and sharing of ideas.
Spreading investment across the UK and promoting regional growth outside of the capital is also on the wish list of the Royal Academy of Engineering (RAEng). The body says opportunities to improve living standards and increase productivity must be available across the whole of the UK.
It proposes that local institutions – such as Local Enterprise Partnerships, Catapults and universities – need to attain consistent, national levels of excellence and their services must be promoted more widely to those who will benefit.
What the parties are offering
The Lib Dems have also stated they would hope improve investment across the country and away from the capital, championing the Northern Powerhouse and Midlands Engine initiatives, and devolving further revenue-raising and decision-making powers away from Westminster
Labour has said it will seek to establish a new National Investment Bank with regional development banks in every region to make sure infrastructure projects and investment is evenly distributed across the country.
SMEs
What the industry is asking for
The NFB has welcomed measures to increase opportunities for SME housebuilders but maintained that land, along with finance and planning, remains an issue for small builders.
The Specialist Engineering Contractors’ Group said SMEs could be boosted by a future government and parliament bringing in legislation to protect all retention monies in a ring-fenced account, as a first step towards zero retentions by 2025, and prioritise a review of the Construction Act.
It said from 2021 all publicly-funded built environment work over £1m should be paid using Project Bank Accounts. Payment security will guarantee a sustainable supply chain of SMEs.
Equally the Federation of Master Builders (FMB) also believes SMEs will be key to any success a future government has, particularly the Tories.
The FMB said: “The manifesto’s explicit pledge to diversify the delivery of new homes is extremely welcome, key to doing this will be being able to build on some of the sensible reforms outlined in the recent Housing White Paper. As is widely recognised, smaller scale house builders have a strong focus on quality. By supporting greater diversity in terms of the companies building our new homes, a Conservative government would be killing two birds with one stone. This is a vision that SMEs can build on.”
Other pledges of note….
Late payment
Labour is “declaring war” on late payments and will demand that all bidders for government contracts pay their own suppliers in 30 days.
The Tories are proposing a similar policy, which would mean that businesses that don’t abide by the Prompt Payment Code will lose the right to bid for government contracts. Also, the Tories are pledging to make one third of their purchases from SMEs by the end of the next parliament.
Apprenticeships
The Lib Dems want to double the number of businesses that hire apprentices, to develop national colleges to deliver high-level vocational skills, and to increase advice in schools about entrepreneurship and self-employment. They will also encourage all schools to participate more with businesses.
Labour wants to create a National Education Service for England, double the number of completed apprenticeships at NVQ level 3 by 2022, and protect funding to SMEs that hire apprentices.
The Conservatives are planning to launch new vocational qualifications called T-levels covering 15 subjects including construction, creative and design, digital, engineering and manufacturing, health and science. They also plan to establish new institutes of technology in every major city in England. They have also reaffirmed a commitment to deliver three million apprenticeships by 2020.
