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Cannibalism must end if sector deal is to succeed

Rob Driscoll

The government’s publication of its much-anticipated construction sector deal has been a long time in the making.

The Electrical Contractors’ Association and partners contributed towards the deal’s development and stand ready to play a major role in delivering some of the opportunities it presents.

Given that the engineering services sector accounts for some 40 per cent of construction and a major part of facilities management, we have a pivotal role to play in making the sector deal a success. 

No SME left behind

It will be crucial to work with government and the Construction Leadership Council to translate the sector deal’s focus on whole-life procurement into practical improvements. The same is true of the development of digitalisation, offsite construction and highly skilled apprenticeships.

The government’s small business commissioner Paul Uppal also told me that the challenge for the industry in terms of offsite and digitisation “will be to take SMEs on the journey and not leave them behind”.

The construction sector deal also recognises the need for solutions to the industry’s ongoing contractual and payment issues, and gives the government a chance to show leadership in these areas.

“There may be a role for the small business commissioner in ensuring everyone is singing from the same hymn sheet”

High-profile collapses such as Carillion’s have confirmed the cannibalistic nature of construction business models. These have had a severe impact on the industry’s capacity to deliver the government’s infrastructure and housing pipelines, as well as leading devastating consequences for many SMEs.

The same hymn sheet

Several initiatives have emerged to address poor payment, such as ‘mystery shopper’ and the duty to report on payment, as well as the ongoing Aldous Bill on holding retentions in trust. It may be that there is a role for the small business commissioner in integrating some of these initiatives, and ensuring everyone is singing from the same hymn sheet.

I asked Mr Uppal how we as an industry can make the sector deal successful, to which he pointed out “the next layer of initiatives” and that government should “enlist the knowledge and experience of those working with SMEs to ensure these priorities do not get lost or forgotten”.

The commitments within the sector deal to fairer payment practices, as well as digitalisation and skills in the construction industry, are extremely welcome.

However, we need to make it absolutely clear that lasting change will not happen unless government steps up and delivers quicker, tougher action to protect the supply chain from the huge risks it continues to face.

Rob Driscoll is deputy director of business policy and practice at the Electrical Contractors’ Association and a business adviser to the Cabinet Office

Readers' comments (1)

  • The sooner we change our vocabulary the sooner things will start to improve. We’ve seen all the initiatives before M4I, Latham before that. Now this! then that then the other yeah yeah pigs might fly! Let’s stop using the word supply chain for a start. It’s a metaphor that describes a chain something One used to use for flushing the toilet! Again sub contractor or sub sub contractor and tier 1 tier 2 tier 3 la la la! These phrases describe something below, beneath, under. Something subservient, something that can be lorded over, something that can wait for its money as we are tier 1 we are main or prime and they are sub! So my challenge is to you right down alternative descriptions - the word customer or client are not allowed ( these have been tried already) and when you come up with new words for describing our trading structure. Write down how how ridiculous our late payment culture.
    So what’s your view on these words I hear you retort. Well you know, as the world goes through change due to advances in technology, we and that includes the trades that build our buildings need to accumulate asset they need to become investors and indeed they are investors in our buildings, they invest their time, money and expertise. So the sooner we start identifying them as investors rather than subbies, tier 2,3,4, someone to dump risk on. And the sooner they see themselves as investors, we will see a culture change and the tools to ensure our investors are treated as such.

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