Green Deal’s skills shake-up
The Green Deal in the government’s new Energy Bill will lead to the introduction of a new government-backed “quality mark” for multi-skilled individuals and rigorous assessment to make sure it avoids becoming a “cowboy’s charter”, writes Michael Willoughby.
Four working groups have been set up, reporting to climate change minister Chris Huhne, to consult the industry and advise on how new accreditation and quality assurance systems will work.
But moves are being hampered by the current “balkanised” state of industry’s skills industry, according to a source close to the DECC, and the situation could even indirectly result in a shake-up of the industry’s three sector councils: Summit Skills, Construction Skills and Asset Skills.
According to the plans in the Energy Bill, up to 250,000 people will be employed installing up to £6,500 worth of insulation, new windows and boilers in the nation’s homes. Micro-generation will be excluded from the Green Deal, as it is covered by feed-in-tariffs.
The upfront cost of these installations will be borne by energy companies or other Green Deal providers, with consumers repaying them over 25 years through a charge on their energy bills.
The four working groups have been set up to canvas industry opinion on policy detail. Dr David Strong, formerly of BRE and now an independent consultant, is chairing the group on skills accreditation. A group chaired by Andrew Warren, director of the Association for Conservation of Energy, will look at taking the Green Deal into social and private rented homes.
The third is chaired by Paul Morrell and will look into up-skilling the industry. The fourth is headed by Brian Scannell, managing director of National Energy Services, which represents domestic energy assessors (DEAs). It will develop policy on how householders’ properties will initially be assessed, and how the work will be checked and monitored afterwards.
But a source close to the working groups warned that the industry’s skills framework was ill-suited to the needs of the Green Deal. “It is an unfortunate and muddied environment where we’ve got different sector skills councils and awarding bodies for different skills. This will have to be thought through and become more joined up if the policy is to launch on time.”
This issue was also identified in Paul Morrell’s Low Carbon Construction report.
The coalition will be particularly sensitive to the issue of accreditation and quality assurance after the Australian government launched a similar initiative. Four roofing insulation installers, working under the government’s “insulation rebate” programme, were killed in as many months, leading to the resignation of environment minister Peter Garrett in February 2010.
A house in Brisbane was found with a “live roof” after foil-backed insulation material was stapled through electrical cables, and some reports suggested that hundreds of homes could have been left in a similar condition.
Meanwhile, the Federation of Master Builders (FMB) has already presented a proposal for a competent persons’ accreditation scheme to the Department for Communities and Local Government (CLG), covering the installation of insulation and replacement walls and roofs. The scheme is based on a computer-based self-certification accreditation program, similar to the driving theory test, and is due to be launched in autumn 2011.
“We think most experienced builders will have practised most of the skills needed,” said FMB director general Richard Diment.
Stephen Hamil, NBS
Q&A
Stephen Hamil
Stephen Hamil is head of Building Information Modelling at NBS, a company owned by the RIBA that provides product performance data
to specifiers. It recently carried out a cross-industry survey on attitudes to BIM which received more than 600 responses.
How is NBS adapting to the world of BIM?
We like to think we’re putting the “i” into BIM. Our information products are used by the majority of leading architects, who are all using CAD. Our specifications are traditionally provided to clients as paper print-outs, but now we’re turning the product data into “objects” that can be exported into BIM-enabled CAD packages. So the CAD model will have increased functionality — if you make changes to the CAD drawing, the specification will be updated automatically.
Sounds great for architects, but what about contractors?
If you’re on a design and build project and using an architect, you’ll get better value from them if they’re co-ordinating CAD and specification information. It’s in contractors’ interests to get a better set of project documentation. In fact, we’re talking to Laing O’Rourke’s BIM division about our product.
What are the headline results from the survey?
The most worrying part was that 43% of respondents weren’t aware of BIM. On the other hand, 25% thought their firm would be using it within one year, and 50% said within three years. So if the government and clients start to insist on BIM, then that means half the industry will have moved on and half will be left behind.
We know Paul Morrell is pro-BIM for the pubic sector, but are private sector clients up to speed?
Asda, a major client, is saying “if you want to work for us as consultants you will use BIM as we define it, and here our software packages”. They’ve also said [at a recent conference] that they have a plan to roll it out to contractors.
What else did the survey show?
That there isn’t a globally-accepted definition of what constitutes BIM. But if, like some respondents, you’re doing engineering analysis within the design model and integrating it with project schedules, then we think you’ve probably crossed the line.
Month in numbers
7.5
The percentage cut in the minimum wage for 70 000 Irish construction workers, voted for by Irish construction unions.
13
The percentage of UK contractors bidding for work on a break-even basis, according to KPMG’s global construction survey 2010.
500
The number of contractors signed up to recycling body WRAP’s “Halve Waste to Landfill” campaign since October 2008.
11,000
The construction jobs that could be lost in Scotland in 2011, after the Scottish Building Federation said two-thirds of its members expected to reduce the size of their workforce.
1.25bn
The value, in pounds, of four contracts for the main tunnelling work for London’s Crossrail. UK contractors Bam Nuttall, John Sisk, Kier Construction, and Balfour Beatty all secured work.
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PAS 91 still mired in confusion
Confusion still prevails over the use of PAS 91, the government’s standardised pre-qualification questionnaire, with even the industry bodies involved in developing the form uncertain as to its status in public sector procurement, writes Stephen Cousins.
Use of the form is now mandatory for all government departments procuring construction work from 1 January 2011, and for use by departments’ “agents, agencies and non-departmental public bodies” from 1 March.
But October’s official announcement on PAS 91 from the Department of Business, Innovation and Skills failed to flag up this policy decision. Instead, the information came in a “procurement policy action note” from the Office of Government Commerce, dated 10 December, which has not been widely seen by the industry.
PAS 91 was developed by the British Standards Institution in partnership with BIS, the National Federation of Builders, Federation of Master Builders, Civil Engineering Contractors Association, Specialist Engineering Contractors Group and Constructionline.
The new form is designed to cut the time and costs of contractors filling out separate, bespoke questionnaires each time they bid for public sector work, estimated to waste £250m a year.
Rudi Klein, chief executive of the Specialist Engineering Contractors’ Group, said: “Unless firms are members of large trade associations like ours, many will not be aware [that the forms are mandatory for some public sector clients]. The lack of widespread publicity will mean many firms will lose out on contracts.”
Klein also stressed that PAS 91 needed to replace existing pre-qualification schemes, such as those run by Constructionline or individual contractors, before SMEs would see real savings.
An NFB spokeswoman argued that PAS 91 should also be compulsory for local authorities. “While any move to make PAS 91 mandatory for central government and non-departmental public bodies is to be welcomed, the real litmus test lies in making it mandatory for local government, as this is the level at which most construction SMEs would bid. They need a level playing field and fair access to local projects — an inconsistent approach will undermine the purpose of PAS 91.”
Richard Diment, director general of the FMB, agreed there was confusion. “We were given to understand that central government could only enforce PAS 91 for central government departments, but our members are not often in contact with central government. Also, we don’t know which non-governmental public bodies are included. And there ought to be pressure on Constructionline to adopt it.
“We’ve got a government committed to seeing a higher proportion of SMEs securing government contracts, but government actions aren’t matching the rhetoric,” he concluded.
Review groups set to probe construction inefficiencies
The Strategic Forum for Construction has set up five review groups to examine the barriers to delivering efficiency savings for public and private sector clients.
The reviews will focus on: poor payment practices; how wasteful practices hinder efficient design; the lack of transparency on project costs; the lack of shared objectives on projects; and apprenticeships and the challenge of training the future workforce.
Jon de Souza, director of Constructing Excellence and the Construction Clients Group, which is acting as the Forum’s secretariat, said: “As an industry, if we can look at the areas that get in the way of best value, we’ll be better able to deliver better projects.”
On cost transparency and accountability, de Souza pointed out that the Office of Government Commerce already recorded project cost information. “But would it be useful if costs were banded and published, so that we had five bands of health centres for instance, and clients can say ‘we want a Band B’?” he asked.
Each of the five groups is led by one of the Forum’s member bodies. The reports are due early in 2011.
Room service
London’s Savoy Hotel has re-opened after a £220m restoration, overseen by main contractior Chorus. The project involved 268 guest rooms, a 16-room royal suite, and extensive back of house works — all featuring Dorma door closers.
Constructing Excellence plans global expansion
Constructing Excellence, the member organisation for contractors, consultants, clients and suppliers committed to improving the industry’s performance, is in talks to set up three international satellite offices next year, targeting the Middle East, Australia and New Zealand, and the Americas, writes Michael Willoughby.
The body is drafting priorities and a business plan with BRE and Manchester Business School. The three organisations hope to kick off the overseas expansion initiative in 2011, possibly in partnership with existing regional organisations.
The initiative will seek to engage with overseas clients and governments with a view to influencing local clients on current best practice in the UK, creating a climate which could ultimately be conducive to British construction business.
For example, the new international hubs could promote best practice in PFI, sustainability or procurement; establish local demonstration projects; and run conferences, workshops and events for local clients.
“There are plenty of countries around the world that still believe that the best way to procure construction is the old way, which simply goes to the lowest price,” said chief executive, Don Ward.
“Our value-add will be to facilitate discussions between clients, industry and governments and to help clients set up projects in better ways to deliver success. If we can pre-condition for best practice, then British firms can win work.
“We’re good at creating better conversations with people. If you’re having conversations along the supply chain, you’re making a difference,” he added.
The proposal is an extension of ad hoc work done by Constructing Excellence throughout the world recently, said Ward. “In the last three years, we have been going to talk about the UK industry’s strengths, such as Egan, Latham, or sustainability, in Korea, Japan, China, Middle East, Brazil, Portugal, Egypt and Luxembourg,” he said.
Although Constructing Excellence has carried out such work on a consultative basis, any new offices could replicate the membership model of CE in the UK. Meanwhile, BRE has been employed to advise on the Rio Olympics in 2016.
“Working as a consultant was fine on an ad hoc basis, but on a longer term basis could compromise our independence, which is our strength,” added Ward,
The proposals have been discussed with government body UK Trade & Investment, which has agreed that the plans would complement its own promotion activities overseas. However, it is understood that UKTI has not offered any funding yet.
Constructing Excellence already has a presence in New Zealand. The organisation’s staff includes Peter Cunningham, formerly chief executive of the Construction Clients Group.
Australia is seen as a vibrant construction market for 2011-12 with 47% GDP growth and a breaking wave of PPP/PFI projects.
Bigger companies take corruption more seriously, reveals survey
The largest worldwide contractors are taking more active steps to protect themselves from charges of corruption than less substantial companies, according to KPMG’s Global Construction Survey 2010.
The consultant’s survey of 140 construction and engineering companies found that 44% of contractors with turnover of more than $5bn had enhanced their internal policies and procedures in the light of governments’ tougher enforcement of corruption legislation.
However, that figure fell to 35% of companies with turnover of $1bn-$5bn, and just 14% of firms with a turnover of less than $1bn.
Split regionally, 44% of companies based in the Americas were taking action, compared to 28% of contractors based in Europe, the Middle East and Africa, and just 15% of companies based in Asia Pacific.
Asked whether they had stopped working in countries with a score of five or less on Transparency International’s Corruption Perceptions Index — where 10 is highly clean — overall 8% of the largest contractors said they had, including 6% of contractors in the Americas and 5% in Europe, Middle East and Africa.
However, 55% of companies also said that they were unaware of the World Economic Forum’s Partnering Against Corruption Index, while just 10% were implementing its best practice guidance, and 35% were aware but not participating.
Survey reveals depth of industry’s dissatisfaction with procurement
A CIOB survey into construction procurement reveals a broad range of concerns with current practice in the public and private sectors, with 77% of the 525 respondents stating that clients are not sufficiently knowledgeable about procurement in the industry.
Overall, 93% of respondents had been involved in projects that overran in terms of cost, and 57% of this group believe the chosen procurement method was a contributory factor to the cost overruns.
Meanwhile, 94% had been involved in projects that overshot their programme, with 49% of this group believing that an inappropriate choice of procurement route was partly to blame.
The survey comes as the government and chief construction adviser Paul Morrell tackle the issue of efficiency in construction and achieving better value for money for the public purse.
Asked about the biggest problems that arise during the procurement process (see figure 1, above left), the answers most frequently selected by respondents were: lack of communication; alterations to clients’ requirements; and issues over responsibility. The type of contract chosen was the least-selected answer.
When the respondents were asked to nominate ideas that should be prioritised in public sector procurement (see figure 2, above right), the most popular answers were increasing standardisation and reducing the cost of procurement. Sustainability emerged as the third most popular answer, while public accountability and cost transparency was fourth.
But two areas being flagged up as a route to a more efficient industry — off-site manufacture and Building Information Modelling — received less support.
Given the complexity of today’s construction projects and the wide choice of procurement routes, CIOB deputy chief executive Michael Brown said that the level of dissatisfaction with procurement outcomes was unsurprising. But he warned that the industry shouldn’t side-step its responsibilities by blaming clients.
“If the industry had an efficient, reliable way of procuring buildings to promote, maybe we wouldn’t see these results. Shouldn’t we be making life as easy as possible for the client? That’s how it works in other industries,” he argued.
“My feeling is the industry needs to think about its own offer and promote it to clients,” he added.
Brown agreed that public accountability and transparency were moving rapidly up the national agenda, but also warned of possible “unintended consequences”.
“Transparency and accountability are absolutely key for public authorities, but if you’re not careful it could drive clients back to accepting the lowest-cost tender and traditional procurement.”
The new PAS 91 pre-qualification questionnaire (see news page 5) could be seen as a partial answer to respondents’ call to reduce the cost of procurement.
But Brown echoed others’ doubts about the effectiveness of the form. “Mandating it is a good idea, but as it hasn’t been mandated for local authorities, does it go far enough?”
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