Perhaps the most over-used adage the past year is the perfect storm which has been rolled out to describe almost every aspect of business, civic and personal life in 2021. There has been such a convergence of challenges visited upon our industry that, in truth, there is no single response or strategy to manage all the implications. Construction has had to adapt to the impact of the global disruption of materials manufacturing, the calamitous logistical melt down of the shipping freight routes, the everyday impact of Covid isolations and restrictions, and the NI Protocol.
The unpalatable truth for much of this year for many local contractors has been the delivery of public works at a loss for clients fearful of reproach for not enforcing inflexible contracts written for ‘normal’ times. For much of the year, our focus at the Construction Employers Federation (CEF) has been on working with the Executive to ameliorate this crisis and while we have undoubtedly made some progress in the shape of the procurement advisory note on materials, it is beyond doubt that these challenges will persist well into the year ahead.
As ever, we are indebted to our members for their time in working with us to come up with solutions to the many issues that have arisen across the last twelve months. Much of this has been achieved within our three new member taskforces to specifically focus on key areas of concern across our membership: CO2nstructZero, People and Skills, Risk and Procurement and these truly are the themes where the future of the industry will be decided.
In the upcoming election year, we will be focused on the new investment strategy, planning reform, water funding, streamlining procurement, and generally a better deal for construction. Our job, as ever, in 2022 will be to bring home to our politicians that it is only with a thriving, vibrant local construction industry that Northern Ireland can see sustained economic growth in the years ahead.
To some, construction conjures up images of early starts, muddy boots and wet trenches. To others, it means virtual reality headsets, precision engineering and innovative carbon reduction techniques. In truth, construction is all of these things and more.
With an annual spend of around £3bn, a workforce of around 65,000 and public sector capital budget of around £1bn a year, construction represents around 10% of NI’s GVA calculation. Every aspect of civic and public life from homes to transport, to schools and hospitals is reliant upon construction, so it is obvious we are not a sector that can be neatly parcelled up under any one Executive department; rather we seek to engage with all stakeholders in government. Perhaps it is from the experience of this very broad engagement that highlights the all-too-familiar observation that we are over governed but under served by our local government systems.
The recent Ministerial Advisory Panel on Infrastructure, led by the IoD’s Kirsty McManus and strongly supported by the CEF and every other representative body, recognised that, in a constrained economic landscape, the importance of prioritised investment must transcend the structural politically driven silos of a mandatory coalition system. Investment should be driven instead by objective assessment of the relative merits for the entire economy and community.
Northern Ireland contractors can be rightly commended for the quality of finish and pride in the job which is recognised as superior to most construction work in these islands. Indeed, many notable local firms, having realised they can replicate this offering in other regions, have established themselves in new markets in GB to a point where they have been assimilated. In so doing, they discovered that compared with NI, the procurement processes in GB are more streamlined and the clients more inclined to work in partnership rather than defaulting to the suspicious and adversarial stance which is sadly still all too common among our local public sector.
Wherever our local contractors are working, like any successful business they require many skills including finance, people skills and technology, over and above the core building trades. Local contractors are re-imagining their businesses and implementing elements of so-called modern methods of construction, to meet the constantly evolving context of energy efficiency, virtual modelling and integrated supply chain quality. New skills sets, amongst both direct and subcontracted staff and investment in digital systems are high on the agenda of every business owner.
So while private investment by the industry is ensuring we are fit to effectively deliver the demands of the future built environment, obstacles continue to arise from the public sector’s failure to engage collectively with the industry in the big conversations of the day, namely skills shortages and carbon reduction. These are topics of a scale and complexity that will only be advanced in a meaningful way by open and honest engagement with all stakeholders at every stage and not in a salami slicing manner across a tiny jurisdiction. With an Assembly election approaching us in coming months, it is timely to remind those we elect to serve us, that local employers and their workforces are constituents for more than a few months once every four years.
Mark Spence is managing director of the Construction Employers Federation (CEF)