Building and investing for the future

Andrew Millard

The New Statesman hosted a group of experts to discuss the challenges and opportunities associated with the UK construction sector.

Viewing the construction industry purely through the lens of the housing sector, a New Statesman fringe event concluded during the Conservative party conference last month, misses the point. A roundtable discussion that brought together parliamentarians, policymakers and industry professionals alike saw the group deliberate over issues concerning the United Kingdom’s industrial strategy, construction’s role socially, the skills gap in the context of Brexit, and even how buildings affect health-care spending.

John Penrose, the MP for Weston-super-Mare, got the ball rolling and his opening remarks addressed the scope of how we define “value” when reflecting on the building process, from concept right through to construction. Bemoaning the “difficulty of acquiring land at a sensible price”, he pointed out that “land speculation and appreciation” had supplanted the honest aims of building something new, fit for purpose and with potential.

He said: “We need to work out how we deal with the fact that value creation is not actually created any more, but is really just appreciation. We have a problem with land supply. If we can get the real value, in designing, building and creating liveable spaces, then that becomes the main game in town. I would suggest that part of the answer is in making use of the fact we are a remarkably open environment, compared to other parts of the world.” Alluding to too much red tape in the planning process, Penrose suggested, “If we can genuinely facilitate building up, not out, then we have an opportunity to add something like 40 to 60 per cent of more buildings on existing sites.”

Eddie Hughes, the MP for Walsall North, joked that it was uncharacteristic of Conservatives “to be so interventionist” but said that the government would be foolish not to see the benefits of expanding the construction industry’s brief beyond building alone, and into place-making. A balance between regeneration and new developments, he recommended, should form a pillar of any local economy. “Whether it’s housing or office space, a new building can boost an economy. It can attract new investment and employment to an area. If you make a place, with things for people to move to – jobs or facilities – then it’s more likely that they will.”

The UK’s decision to leave the European Union has undoubtedly thrown a curve ball across the country’s political and economic landscape. A major study into migration from the Construction Industry Training Board (CITB) found that a third of UK firms employ migrant workers. That Brexit injects fresh impetus to plug the UK skills gap, then, was not lost on the roundtable. Hughes added, “The problem we’ve got is in answering: who’s going to do all this building? We’ve also got an ageing construction sector and face the problem, possibly, with the repatriation of some of those builders going back to plying their trades in their own countries. So we have a collective responsibility, as government and industry, to make the construction sector more attractive over here. They need to know that they can make a perfectly good living as a plumber, a bricklayer or plasterer and that their country needs them.”

While he agreed that Brexit might have renewed the focus on the need for better technical skills in the UK, the editor of Construction News, Tom Fitzpatrick, was keen to stress that this is an issue that has endured for many years now, largely owing to persisting problems with the industry’s perception in the wider public. “The skills crisis was being talked about in the 1990s. I guess you can say that Brexit has exacerbated the skills gap, but when people think about construction, they’re thinking about hard hats and muddy boots. The perception needs to shift away from the conditions you experience on site.”

Professor Charles Egbu, the dean of the School of Built Environment and Architecture at London South Bank University and vice-president of the Chartered Institute of Building (CIOB), proposed that the best way to improve uptake in construction courses was to convey a better message about the industry’s potential to enact social or political change. And the CIOB, in partnership with several universities, has put together a growing body of research unearthing previously unrecognised links between the built environment and health, social inequality, education and employment rates.

Egbu said: “The CIOB argues that the value proposition lies in how construction supports wellbeing, and how through construction we might address issues of inequality and education. Moreover, the issue of technical skills competency also relates to social mobility and helping people to find work.” Concordantly, the CIOB has been working with other construction-related professional bodies to provide an information resource to help improve investment decisions in the industry. If policymakers recognise the difference the built environment can make, Egbu argued, they are more likely to develop it.

Dr Paul Chan, the editor of Construction Management and Economics, meanwhile, noted that there “needs to be a clearer distinction between further education and higher education”. He added that industry needs must be factored into the syllabi of courses in advance, to allow for a greater synergy with academia sooner in the pipeline. “The skills shortages often occur because there is a mismatch of what the industry is producing when it might need something else. The classic example is the flux of bricklayers back when the Channel Tunnel was being built.”

When it comes to the housing crisis, which has been a thorn in the side for successive governments, there is, as the economist Brian Green suggested, a bit of a misunderstanding regarding quantity over quality. That the UK needs to build more houses is an accepted reality, but what good are more houses if they are not built well? In the haste to build more houses, there can be a dereliction of duty to build more homes. Green observed that where someone lives has an immediate effect on their physical health. He said: “There is, as [Health Secretary] Jeremy Hunt has made clear, a correlation between damp homes and the cost that causes to the health service. What you get is a case of doctors prescribing new boilers!”

While the requirements for housing in both the public and private sectors have changed over the years, the Greater Manchester Local Enterprise Partnership’s Michael Oglesby highlighted, approaches to architecture have not. While maintenance, management and allocation policies have played their part, design remains central to whether housing can be considered successful. More recently, developer-built city centre flats, aimed at an investment economy, have come under fire for their small size and limited storage facilities; while more suburban schemes are criticised for failing to deliver public space, sufficiently sized rooms or nearby infrastructure. Oglesby said: “I look around building sites today and very little has changed from 60 years ago. We are still building houses in the same way.”

Ultimately, as Mace’s director for the North and Scotland, Steve Gillingham, put it, the construction industry must not be dealt with in silos and “cross-party collaboration” is necessary. He summed up: “There is a need for confidence in long-term investment from government, to keep the construction industry well equipped. There must be a clear industrial strategy sooner rather than later, because the pipelines need to be full and the right levels of throughput must meet manufacturing’s demands.”

Andrew Millard