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Levelling out the playing field

LAW

Despite the industry's poor safety record, there is no legislation that requires firms to be qualified under a statutory scheme.

Rudi Klein looks at how a stringent national qualification scheme could weed out the cowboys from reputable firms

ALMOST 10 years ago, Sir Michael Latham's report Constructing the Team recommended a national qualification scheme for consultants and contractors in the UK construction industry. It recommended that the public sector should take a lead in promoting the old Contractor Management Information System (CMIS) and the Consultants Register (ConReg) as the basis of such scheme. A further recommendation was that public-sector clients should require first-line contractors to engage sub-contractors that were registered on these lists.

These recommendations have never been implemented. Instead, the government launched Constructionline in 1998 as a public/private partnership with Capita. The idea was that public-sector clients could use the register rather than their own lists. But the government was not prepared to grant Constructionline a monopoly position, nor was it keen to require first-line contractors to use Constructionline-registered sub-contractors.

The upshot is that, in addition to registering with Constructionline, the industry is still faced with a bewildering array of qualification lists. Many publicsector clients, especially local authorities, insist on using their own lists.

Within the private sector there are also dozens of charlatans vying with each other for their own lists to be accepted as pre-eminent. The industry is wasting millions of pounds on having to register with these multifarious lists, which do not provide any guarantee to the clients who use them that the firms are competent.

The government has failed to offer any leadership in this context. Its philosophy is that the free market in construction should remain and so any firm can enter the industry describing itself as a builder, plumber or roofer without having to show that it is qualified to do the work.

The assumption is that this free market enhances competition. On the contrary, there can only be healthy competition when there is a level playingfield; it cannot exist where reputable firms are competing against cowboys.

The industry's poor health-and-safety track record has now given added prominence to the issue of qualification. The theme of the government-sponsored Health and Safety Summit in October 2001 was 'qualified employers and qualified employees'. With regard to the latter, progress has been made with the insistence by the major contractors that those entering sites should have a Construction Skills Certification Scheme card.

The next phase is to require that firms are also qualified. There is little point in requiring that employees have a CSCS card unless the firm that employs them has shown that it is equipped to provide the necessary training and resources.

This is to ensure that its employees have a continuing ability to perform, not only the work that they do, but also in a way that reduces health-and-safety risks.

The basic principle is that construction work should only be carried out by firms which are properly resourced, have the technical ability to carry out the work and a sound health-and-safety record.

It is strange that other free enterprise economies have legislation requiring that firms working in construction should be qualified. This is so in many states in Australia and the US. For example, California has a statutory licensing system requiring contractors working on public-sector projects to be licensed.

How can we achieve this in the UK?

The ideal vehicle is the Construction, Design and Management Regulations 1994. CDM already requires that designers and constructors are competent - but the word 'competent' in this context is unhelpful. Firstly, what does it actually refer to? Is it the designer or constructor that must be competent or is it the firm? Does competence apply to all levels of designer or constructor?

Secondly, competence does not lend itself to enforcement. Can you imagine an inspector coming onto the site and asking an architect or engineer whether he is competent? This provision in CDM must be made meaningful and effective.

So I propose that CDM be amended to require that firms are qualified. The notion of competence must embrace the notion of qualification.

But what do we mean by qualified?

The industry does not need yet another qualification scheme. However, some of the better schemes are now being set up by the industry through the trade associations. They are independently audited and the work of the firms qualified under the schemes is regularly inspected.

The CDM Regulations should be amended to require that all firms providing design and/or construction services are registered under a qualification scheme that satisfies certain criteria laid down by the Regulations. Such criteria would require that the relevant scheme has been independently approved and audited with stringent health-and-safety requirements. The Secretary of State at the Department of Work and Pensions (responsible for health and safety) should regulate these qualification schemes.

As a result all schemes would have to satisfy the necessary criteria. Then, if a firm belongs to an approved scheme, that would be sufficient for satisfying the requirements of the CDM Regulations as well as showing that it has the requisite resources to carry out the work.

A final word on competence. Within our legal system, competence becomes relevant when there has been an accident.

It is linked with proving that the accident resulted from the negligence of the defendant. A defendant is only able to escape the allegation if he has evidence to rebut a claim that he failed to act competently. In other words, the issue of competence generally arises as part of an ex-post facto inquiry into whether or not negligence has been committed.

Key points

Sir Michael Latham's recommendation for a national qualification scheme for consultants and contractors was never implemented.

In 1998 the Government set up Constructionline, a public sector registration scheme.

There has since been many qualification lists, without any guarantee that the firms on the list can deliver the requisite quality.

To rectify this, the CDM regulations should be amended to require that firms are qualified, not merely 'competent'.