Sector given chance to have its say
The industry has been given an opportunity to influence the way the UK construction industry is administered by the Government in the future. The chance presented itself when the Trade and Industry Select Committee (TISC) announced (March 29) that it was holding a “wide-ranging inquiry” or Parliamentary review into the UK construction industry. Parliamentary reviews are designed to inspect, on behalf of the House of Commons, the expenditure, administration and policy of a Government body on an aspect of the public sector. A cross-party group of MPs defines the scope of the review, gathers and scrutinises the evidence submitted by stakeholders, and writes a report, setting out the views of the Committee. The report contains the Committee’s recommendations for improvement. This is then presented to the Government, which has two months to respond. Explaining the significance of the inquiry a committee spokesman said: “This inquiry gives the industry an opportunity to influence both the agenda and the way the Department of Trade and Industry administers the sector in the future.” Commenting on the announcement Rudi Klein, Specialist Engineering and Contractors’ Group chief executive, said: “This [is] a major event, as it is the first time Parliament is investigating the construction industry’s practices and performance. It couldn’t come at a better time as we are now engaged in the highest level of [construction] activity since the 19th century.” Mr Klein said current procurement practices and the delivery agenda needed to undergo reform. “Procurement and delivery in the industry are wasteful. Our overheads are high, with money wasted on poor practices and poor payment processes,” he explained. “It is necessary for the industry to be collaborative and to integrate processes in order to be more efficient. There are silly margins in the industry – 2.5 per cent. We must create more profit for the industry by cutting out wasteful practices.” He said a 2005 SEC Group survey revealed that 57 per cent of m&e contractors experienced poor payment practice in Government contracts. He argued that many m&e contractors were not involved on the design team, when they should be. “We want the committee to say they must be involved at an earlier stage. We want the committee to make recommendations to tackle these issues, and see the inquiry as acting as a catalyst to prioritise reform of the construction industry over the next few years. “We will lobby to determine what these recommendations are – we want to see project insurance and project bank accounts becoming much more widespread,” he concluded. Rod Pettigrew, commercial and legal head at the HVCA, said: “We very much welcome the Committee’s inquiry and we think it provides an excellent opportunity to review what’s going on within the construction industry. “The scope of the inquiry seems to be very wide, but appropriate. Ultimately, we would like the UK construction industry become world class, and we would like the inquiry put forward recommendations that could achieve that aim.” Peter Thom, Green Heat managing director, issued a note of caution on the inquiry’s usefulness. “We welcome this inquiry. However, I think inquiries are only meaningful when Select Committees takes on board the views of the industry and when the recommendations they put forward are considered properly by the Government,” he said. “Hopefully, this will become a meaningful exercise. We get an awful lot of requests from Government to respond to inquiries, reviews and consultations. The Government is aware of the issues the industry faces daily and we’re at the stage now where what we need is Government action.” Written evidence must be submitted to the Select Committee by May 4.