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Blog: Will Grenfell be a game changer for housing, bidding and contract management?

Image of the Grenfell Tower fire courtesy of Natalie Oxford via Twitter

Image of the Grenfell Tower fire courtesy of Natalie Oxford via Twitter

The social housing sector must make changes across all its platforms, says Andrew Morrison.

Most of us will remember waking up on Wednesday 14th June to the news of a major fire in progress at Grenfell Tower, North Kensington. Switching on our TV channels, we watched helplessly as firefighters worked tirelessly to try to extinguish the fire and save any lives they could in the process. As a housing and bidding professional who spent half of his childhood living in a social housing tower block, I realised immediately that this needed to be a huge wake-up call to the housing world and its suppliers.

What do I think may change in the months and years ahead for both bidding and contract management within the social housing world?

Technical Evaluation – Greater attention should be given to the technical elements at all stages e.g. in the specification of works and materials; the tender evaluation; and both the onsite supervision and post-inspections of contractor work. This will be a challenge for the many organisations who have cut back on professional technical staff.

Health & Safety – When this goes wrong, the consequences are deadly, so the priority given to this needs to be higher. Health & Safety is often evaluated at the pre-qualification stage; expect it to loom larger within the tender stage and be weighted accordingly.

Price vs Technical/Quality Evaluation – Of course clients need to get value for money with their limited resources. However, even since Grenfell, I have seen an opportunity for electric rewiring of social housing come to market with an 80% Pricing: 20% Quality/Technical Evaluation. This is unlikely to drive the attention to quality and safety that is needed.

Balance of Risk – Often clients seek to transfer most of the risk onto the contractor. However, Grenfell showed that when things go wrong, tenants go back to the ultimate property owner, in this case the council. It will be most illuminating to see where the public inquiry places the various liabilities for this disaster.

Bespoke Tender Questions – Many of the tender questions we see are generic and could apply anywhere. So, lack of time at the buyer end to create project specific tender questions can lead to suppliers replicating generic responses. Time spent at specification and bid response stages drilling into the detail will produce a much more satisfactory end result for all concerned. Of course, this takes time and resources which can be in short supply.

Resident Involvement – In some housing organisations, residents have involvement in interviewing contractors and evaluating bids. This is likely to increase as the people who have to live with the consequences of the decisions make their voices heard. This can continue with resident-led inspections of work – a feature of some of the more enlightened housing organisations.

Regulatory Oversight – The reach of the regulator has diminished in recent years. This may change in the coming years with housing organisations being asked to contribute directly towards the costs of increased regulation.

Informed and Proactive Leadership – The Lakenhal House fire in 2009 in London was an horrific harbinger of what can happen when health & safety is not prioritised in high rise dwellings. Since then, many industry experts, most notably Inside Housing, have consistently warned that fire safety in many tower blocks was inadequate and that another disaster was only a matter of time. The fact that the Met Police has announced that it is considering corporate manslaughter charges in the wake of Grenfell will likely concentrate the minds of all housing decision-makers.

In summary, Grenfell has important lessons for all those involved in social housing contracts – housing organisations and their procurement teams; council committees and housing association boards; main contractors, sub-contractors and suppliers; housing regulators and. crucially, the residents themselves need to make sure that their voices are listened to at all stages of the process.

  • Andrew Morrison MSC FCIH is managing director of Lothians-based AM Bid Services Ltd

Blog: Will the Scottish Government respond positively to support Scotland’s build-to-rent sector?

David Melhuish

David Melhuish

By Scottish Property Federation director David Melhuish

Recent news that the UK government is to introduce further proposals to support the development of bespoke build-to-rent (BTR) homes across England is to be welcomed, but it should also serve as a stark reminder that more action is required here in Scotland.

With the introduction of the mechanisms for Scottish local authorities to apply to establish Rent Pressure Zones (RPZs) at the end of this year, as well as the abolition of the tenancy term in favour of lifelong security of tenure, there is now a huge gulf between Scottish and English law as it relates to the Private Rented Sector.  Last year, during the passage of the Private Housing (Tenancies) Act, we argued robustly that the real issue for the private rented sector is supply and that build-to-rent is needed to boost, not just the quality of Scottish renting, but the quantity of homes available to let in the right place and of the right type.  We remain of this view.  We need an increase in housing supply across all tenures and this means making BTR work as well traditional house-building for private sale and affordable living.

Whilst we do not believe that local authorities should seek to establish RPZs where the market is functioning (for example Aberdeen, where average rents for 2-bedroom properties are 12.5% below Q2 2012 according to CityLets Q2 report), there are also several measures that the Scottish Government can implement now to support BTR investment to unlock build-to-rent opportunities in Scotland over the course of the next few years.  There is an urgent need for these measures. Currently little more than 1% of UK build-to-rent PRS investment is being directed to Scotland. This is simply not good enough given the gap between demand and supply across the country. A failure to act now could mean that hundreds of millions of pounds could bypass Scotland as investors see England as a more attractive proposition.

In Scotland, we have some important advantages. We welcome the Scottish Government’s decision to exempt large scale private rented sector transactions of six or more properties from the 3% additional dwelling supplement. This measure can offer a positive differentiation to investors in UK real estate from the Scottish perspective. We are also encouraged that the Scottish Government is at an advanced stage of proposing a Rental Income Guarantee Scheme, which will send a positive signal to the markets of the government’s intent to build a BTR sector.

Yet there are some outstanding issues that must be resolved if we are to see BTR become a real asset class in Scotland. A key area where the Scottish Government can be supportive to the BTR sector is to provide a supportive planning environment and we hope to see some positive steps forward in this area soon. Last year our members engaged in the BTR sector provided comprehensive and detailed commentary to the Scottish Government on how to amend planning policy guidance to support BTR developments. This guidance is critical because, as a new market sector in Scotland, there is relatively little understanding of BTR among local planning authorities who tend to relate it to conventional house-building.  For example, we provided the government with a detailed explanation of the differences in valuation treatment and development viability between a BTR and a traditional private sale-led development. It is critical that the government and local authorities understand these differences between BTR and traditional house-building and adapt their policies to allow BTR the chance to thrive.

Scotland urgently needs its government to follow up on some of the promising noises which have emanated from Ministers and officials. Without action, I fear Scotland will continue to be left behind in the creation of this new and exciting residential market.

Blog: Statutory notices and duties of solicitors – the £600,000 Blandfield bill

Gillian Craig

Gillian Craig

Gillian Craig looks at the risk attaching to ownership in an imperfect registration system.

It’s not often that the Daily Mail reports on boundary issues in Edinburgh but the plight of homeowners, some of whom are on limited incomes, being landed with a £600,000 bill (or £6000 each), caught their attention.

The bill relates to the rebuilding or restoration of an old boundary wall next to a development in Blandfield

The situation is indeed a sorry one, with Edinburgh City Council exercising their statutory powers under the City of Edinburgh District Council Order Confirmation Act 1991 to require the owners of the wall to execute repairs, under pain of the council carrying out repairs themselves, and recouping the costs from the owners. The latter course has, as many of you will know, not been without controversy (see for example, BBC Scotland Investigates 2011 Scotland’s Property Scandal).

It would appear that, after some legal wrangling, it has been settled that the home- owners do indeed own the wall in question- much to their surprise (no-one told them, apparently).

Anyway, back to the Daily Mail article which is followed by a raft of readers’ comments as regards the importance of checking the extent of title and queries as regards why the conveyancing solicitors involved did not advise their clients of potential liability.

In a perfect world, both would be easy answers.

However, as regards the title, we have to deal with the inherent inaccuracy caused by the scale of the Land Register (generally being 1:1250 in urban areas).

Separately, however, we have to bear in mind the findings of Sheriff Principal Bowen in his 2015 report “Consumer Protections in Conveyancing Cases- A Report to the Council of the Law Society of Scotland” who concludes that whilst various safety net services as regards the extent of title in new developments were offered by the Keeper “thought needs to be given to clarifying the legal duty of a solicitor acting for a purchaser”.

Against that, arguably the profession cannot constitute a guarantee of title – the question therefore being one of proving negligence which, following Hunter v Hanley, is difficult when a large number of solicitors (presumably following the usual practice, and of ordinary skill, exercising ordinary care) make the same mistake.

It’s still a troubling point with no easy answers.

  • Gillian Craig is a Partner at MacRoberts

Blog: Building design must be considered to fully support those with dementia

Unconsidered design without dementia - a standard healthcare setting design from the point of view of someone without dementia. Notice the signage appears at eye level which is often difficult to see for someone who has poor neck muscles and doesn’t understand they need to look up. The bedside light is not easily recognisable as a light.Architects, contractors and building commissioners must consider the design of new buildings if Scotland is to fully support those with dementia, writes Lesley Palmer.

People living with dementia often struggle to understand and navigate their built environment due to the sensory, mobility or cognitive impairments synonymous with the condition.

Design principles to support people with dementia have existed in the UK for more than 15 years. However, it is only in the last five years that architects, contractors and building commissioners have started to apply these principles to properties outside of the conventional care environment.

Thanks to policy change and increased public awareness, we are now seeing offices, GP surgeries, supermarkets and public buildings being adapted to the needs of the older generation, and specifically for those living with dementia.

Scotland is world-renowned for both its progressive dementia policy and its innovative work around dementia design – with our international partners looking to us for guidance, leadership and support. With a multi-disciplinary approach to design and care, the University of Stirling’s Dementia Services Development Centre (DSDC) has become a world-leading authority on dementia design.

Scotland’s third National Dementia Strategy was recently released with an acknowledged focus – which I personally welcome – on data, information and research.

This, in my opinion, is the best approach to tackling some of the toughest challenges posed by dementia.

3. dementia-friendly design_without dementiaHousing policy is also integral to the strategy and, as Chief Architect at the DSDC, I see the impact that property design can have on the dignity and independence of our senior population. We must consider the design of our housing if we are to fully support those with dementia.

In 2001, the University published 11 research-based principles on dementia design and, by 2008, the DSDC published its first version of the Dementia Design Audit Tool. Today, we are able to see the enormous benefits of the work, ultimately enabling people with dementia to remain living in their homes for longer.

However, there is still work to be done. Since the launch of our first audit tool, there have been many developments; research design methods have progressed, our understanding of the built environment has improved, and the construction industry has evolved.

On 21 September, World Alzheimer’s Day, the University of Stirling will launch IRIDIS – a suite of mobile apps that digitises our research on dementia design principles. Simply put, the pioneering app will allow users to assess how suitable a home or workplace is for people with dementia – and then recommend improvements.

We hope to improve the world’s understanding of dementia-friendly building and enable construction professionals to eradicate the risks facing our ageing population.

  • Lesley Palmer is Chief Architect at the Dementia Services Development Centre, University of Stirling.

This article was provided courtesy of the University of Stirling and first appeared in The Scotsman.

Case review: Did you mean to give notice?

Partner David Anderson and senior associate Sian Jefferies

Partner David Anderson and senior associate Sian Jefferies

Law firm Shepherd and Wedderburn outlines that a recent case demonstrates that a payee to a construction contract may not always require to show that it was their intention to give notice under the Housing Grants, Construction and Regeneration Act 1996 when serving a payment notice.

Factual Background

In the Scottish  case of Trilogy Services Scotland Limited v Windsor Residential [2017] SAC (Civ) 2, the Court was asked to determine whether or not letters sent by the contractor’s solicitor to the employer were intended to be a default payment notice for the purposes of section 110B(2) of the 1996 Act.

The dispute related to a fixed price contract for the execution of certain works in Burtisland. The contract was relatively short and provided for payment in four instalments. The contract also provided for a ‘payment due date’, which was to be within seven days of receipt of the contractor’s invoice. There was no dispute that the contractor had carried out and completed the works in respect of the first three instalments. However, a dispute arose after Trilogy issued an invoice on 16 July 2015 in respect of the fourth and final payment, which was not paid.

The parties’ contract did not make provision for the issuing of payment notices.  Therefore, in terms of section 110(5) of the 1996 Act, the relevant provisions of the Scheme for Construction Contracts (Scotland) Regulations 1998 (the Scheme) applied.

In accordance with the Scheme, the employer, Windsor Residential, should have issued a payment notice to the contractor within five days after the payment due date specifying the amount that they considered to be due to the contractor.  In this instance, however, this was not done.  In terms of section 110A(3) of the 1996 Act, in circumstances where the payer has not issued a payment notice, the payee may issue its own notice to the payer (often referred to as a default payment notice). Such a notice can be given any time after the date on which the payer ought to have given their notice.

On 9 October 2016 the contractor’s solicitor sent a letter to Windsor Residential explaining that the payment was outstanding despite the fact that the work had been carried out in accordance with the Contract. The solicitor included with their letter a copy of the outstanding invoice and threatened to raise proceedings in the event that payment was not made.

The Court was asked to consider whether or not the letter issued by the contractor’s solicitor, accompanied by the outstanding invoice, could constitute a notice under section 110A(3) of the 1996 Act.

Court’s Decision

The employer argued that the letters from the contractor’s solicitor should not be regarded as a payment notice, as it could not have been the intention of the author of the letters that they be a payment notice for the purposes of the 1996 Act. The employer also argued that there needed to be a considerable degree of clarity on what had been done and that the letter lacked such clarity. The employer relied upon the decision in Henia Investments Inc v Beck Interiors Ltd [2015] EWHC 2433 in which the court considered whether the document relied upon constituted an interim application. The court held that the relevant document could not be an interim application as it was not in substance, form and intent an interim application.

Whilst the courts have identified intent as relevant to establishing the validity of a notice, in this instance the Sheriff clarified that there was no need to import ’a requirement of intention’ into each and every case. The Court highlighted the clarity of the factual context and stated that there could be no doubt as to the contractor’s intention – they wished to be paid for the amount they had first claimed. The Court was firmly of the view that the letters constituted a valid notice under the 1996 Act.

This case highlights that there may not be a requirement in each and every case to show that the intention was to give notice under the 1996 Act, as long as it is clear that a party intended to request payment in those circumstances. The court did highlight, however, that the contractual and factual context will be decisive in determining the issue.

Blog: Evolving Edinburgh – how has the capital changed since 2007?

Keith Aitken

Keith Aitken

GVA’s Keith Aitken on how Edinburgh’s commercial property makeup has changed since he took up his current role ten years ago.

A decade is a long time in any game. When I joined GVA ten years ago, all areas of property except for industrial were on the up in Scotland.

Things were going great guns but then the first signs of a financial crisis appeared towards the end of 2007. Everyone knows what happened in 2008, but almost ten years on the country’s commercial property industry has not fully shaken off the post-crash hangover. Attempts to recover have been compounded by rising construction costs, occupier failures and a tumultuous political landscape.

In Edinburgh, some sectors have blossomed whilst others are under pressure and market failure has occurred. Hotels and tourism, residential and student accommodation have exceeded expectations.

The mantra of risk vs. reward is at the heart of real estate development but the legacy of the 2008 crash is that risk aversion is now the norm. Contrary to popular opinion, property developers are not all about profit but their need to satisfy shareholders and funders who were bruised by the economic downturn means that less risk, less reward is standard.

Edinburgh is unlike any other major city in the UK. Its world heritage status means planning conditions are complex. Bids for vacant sites must reflect the most viable use of these spaces to secure funding approval whilst the abolition of empty rates relief means developers can’t afford to hold an unoccupied asset.

The Local Development Plan correctly allows for a variety of urban uses in Edinburgh’s centre and this means that sectors such as retail, residential, student accommodation, restaurant and hotel developments have been able to flourish and are in immediate proximity to each other.

These are all key to a vibrant and successful city, but so is the humble office worker. Office development has lost out recently as this race for space quickens. Whenever sites suitable for offices become available in the city centre they are much sought after by alternative uses that drive greater value and have less risk. In addition there has been a jump in costs per sq. ft. to build a Grade A office space in the city. Today, it costs approximately £200 per sq. ft. to build. This is a substantial increase from 2007 when the average cost was 125-£150 per sq. ft.

Examples of assets that could have been used for offices but have not include the Premier Inn at York Place, Tune Hotels at Haymarket, serviced apartments at Lismore House, George Street and the University of Edinburgh at Lauriston Place.

EDI Group plans to create a new, mixed use, canalside quarter at India Quay

EDI Group plans to create a new, mixed use, canalside quarter at India Quay

India Quay, Fountainbridge is an example of where development has stalled. GVA was involved in the sale of this property just before the crash and the sum would have covered a large chunk of Cristiano Ronaldo’s annual salary.

Yet nine years on and other than a than a high school, an arts hub and a proposed hotel the site remains practically vacant. City of Edinburgh Council took advantage of the weak market conditions to snap it up on a competitive basis and build the school, but development has stalled. The question is why?

There’s no joined up strategic plan in place, no plans for offices and not enough dialogue between private and public sector to get things moving. India Quay had been touted as Edinburgh’s answer to Brindley Place in Birmingham. If any hope of this being the case is to be resurrected then stakeholders from across the public and private spectrum must band together to create a sustainable vision.

Conversely, New Waverley has made massive strides in the same time with office content due to welcome a major occupier to sit along three new hotels.

Office accommodation is expensive to build but must be considered for new developments.

It may not always be suitable due to cost but sites such as India Quay should bring public and private bodies together to allow true urban development to take place. In certain cases, public sector intervention will be required.

Scotland’s capital has earned plaudits as a financial powerhouse second only to London in the UK and as an excellent incubator for tech companies. But Edinburgh’s reputation as a place to do business will be at risk if the public and private sectors do not come together to boost office development.

  • Keith Aitken is regional senior director for GVA in Scotland

Interview: Emerging Architect Award winner Neil Taylor

Neil Taylor

Neil Taylor

The inaugural RIAS/Saint-Gobain Emerging Architect Award recognises the crucial role architects play in delivering a better world and encourages the great architects of the future at the outset of their careers.

This year, the award went to TAP Architecture, recognising two innovative and technically challenging projects: the Aerial Adventures, East Kilbride, and the Scottish National Waterski Centre, Dunfermline.

SCN speaks to Neil Taylor, managing director at TAP Architecture, to find out a bit more about the awarded projects and his role at TAP Architecture.

What were your first thoughts when you were announced the winner of the Saint-Gobain Emerging Architect Award?

2016 was a hugely busy and challenging year of work for the practice. I was delighted that our efforts were being acknowledged and rewarded.

You’ve seen some of your projects awarded in the past – i.e. the Castle MacLellan Foods, winner of an RIAS building of the year award 2016. Were you somehow expecting another distinction this year?

The 2016 RIAS award was the first that the practice had received since I took over as Managing Director of the practice in 2012. It was a huge moment for us and although we had two projects shortlisted this year, I was trying hard not to expect too much. Given the strength of the other nominees, winning the Emerging Architect Award was a lovely surprise at the end of the evening.

In one word, how would you describe your architectural style?

Emerging.

The Aerial Adventures project in East Kilbride. Image by David Barbour

The Aerial Adventures project in East Kilbride. Image by David Barbour

You’ve seen two projects distinguished with the Emerging Architects Award: The Scottish Waterski Centre, in Dunfermline, and the Aerial Adventures, in East Kilbride. What was your inspiration for the these projects?

The two projects have very different briefs and circumstances. The Scottish Waterski Centre was to provide a space from which people would be able to appreciate the spectacle of the water sports. To do this we created a dynamic, glazed pavilion, on the water’s edge.

The Aerial Adventures project was a one-off; a climbing wall and assault course suspended over an ice rink. We wanted these elements to appear to be crystalline and translucent, with smooth surfaces that hug the contours of the existing building.

Was any of them particularly challenging? What would you highlight in each of them?

The Aerial Adventures project was very demanding, due to the geometrical complexity of the design that was developed. Also, because we had to ensure that the proposals worked within the constraints within the existing ice rink arena and the wider shopping mall. We then had only a narrow window of opportunity for our contractors to carry out the installation, as the building was undergoing a major reconstruction at the same time; reaching completion only a few hours before the official opening event began.

Scottish National Waterski Centre, Dunfermline. Image by David Barbour

Scottish National Waterski Centre, Dunfermline. Image by David Barbour

How has the design impacted the comfort and well- being for the end users?

The original Waterski Centre building was not a comfortable place to spend time in – there was no insulation, the heating was insufficient, there were bare blockwork walls and no outlook to the Loch. We installed insulated ceiling and wall linings, as well as new and efficient heating and lighting systems throughout, providing warm spaces for the skiers and the spectators to wait and watch the activities on the water. We also improved the accessibility of the facility with level access to and from the waterside. Both this and the Aerial Adventures project promote challenging, sporting activities.

Are you working on any exciting projects at the moment? Is that a chance that you will submit them to next year’s RIAS Awards?

We have several interesting projects on site at the moment: two new-build houses in rural settings and another ambitious project for Aerial Adventures. Hopefully, they will be worthy of submission to next year’s Awards.

  • More on Neil Taylor and TAP Architecture can be found here.

Blog: Finding a different pathway to my successful career in construction

Elaine Perratt

Elaine Perratt

Elaine Perratt of Cruden Buildings and Renewals, on how she’s progressed up the career ladder as a women in construction.

When I was at school, I wasn’t academic; the thought of going to university had never crossed my mind. I applied for a nursery nursing course and was accepted, so I was looking forward to a leisurely summer before starting the course in September.

My mum, however, had other ideas! She took me job-hunting, and we found a vacancy on what was then known as a YTS scheme, for an office junior with housebuilder and construction company, Cruden Buildings & Renewals Ltd.  I thought it would be a perfect way to get some experience and money over the summer, and it turned out that I loved working in an office.

When September approached, I told Cruden that although I was enjoying my job, I was due to start my college course, and my position with them was only temporary.

Cruden, as an employer, prides itself on finding a pathway to a career for all of their staff.  They offered me a full-time role as an office junior where I would have the opportunity to progress and develop in the company. I jumped at the chance, and what teenager wouldn’t welcome the full time salary?

A dizzy 33 years later, I am still with Cruden. Over the years I have worked in many roles and departments, including accounts and estimating, working with suppliers and helping with tenders. Then, a position came up as an administration manager in the health and safety department, where I initially typed up reports that the health and safety manager was carrying out on site. My manager then suggested it would be easier if I came out on site with him, so I could see what he did behind the scenes.

Once out on site, my manager could see how interested I was in what he was doing, and suggested I sit my NEBOSH general certificate, which is a globally recognised health and safety qualification. I attended a 16-week course on day release at Motherwell College, which Cruden paid for. At the end of the course I sat two exams and successfully gained my qualification.

It was after this that my manager suggested I consider a degree in health and safety. Never in my wildest dreams had I ever imagined getting a degree, but I had really enjoyed my NEBOSH general certificate, so I was delighted to give it a try. My managing director was extremely supportive, explaining that Cruden would help me in any way they could, including giving me time off for studying. My diploma also allowed me to fast track straight into second year of the course.

I attended university for one day a week. At the same time, I was promoted to health and safety assistant, a role which involved carrying out site inspections, checking signage and carrying out risk assessments. I really enjoyed the combination of classroom learning and on-site experience. After three years, I gained my BSc in Occupational Safety and Health, which was a very proud moment.

Even after all these years, I still love working in construction. My favourite part of my job is knowing that I’m getting everyone home safely. It’s good to get people to look at the bigger picture – cutting corners might save someone ten minutes, but an injury could keep them off work for weeks, or even months.

Statistics show that at a typical health and safety seminar or event, in a room full of 100 people, only five will be women. I’ve been lucky that I’ve never experienced any problems with being a woman in construction. Part of that is down to the culture within Cruden – from the top down, everyone supports each other. We are like a big family. Cruden already has an all-female purchasing department, which is quite rare within the construction industry.

There is still work to be done in addressing the sometimes negative perception of the industry. For example, we often visit primary schools to talk about the safety aspect of construction sites, but I feel that more could be done to encourage children into careers in construction at the same time.

I would encourage anyone, male or female, who is considering a career in construction to go for it. My experience has shown that in this industry, even if you don’t start out with qualifications, with the right attitude and a supportive employer you can still have a long-lasting, fulfilling and varied career.

  • Elaine Perratt is an assistant health and safety manager at Cruden Buildings & Renewals Ltd

Blog: How CITB will change under my leadership

Sarah Beale

Sarah Beale

Sarah Beale on her appointment as CEO of CITB on a permanent basis.

We all know our industry faces significant challenges to deliver its pipeline of work and raise its performance.

Crucial to this is attracting, developing and retraining skilled people. This will get harder with an ageing workforce and the likely change in approach to migrant workers as part of Brexit.

But we are focused on solutions and I want to outline how a reformed CITB will work hand in glove with construction and with government to deliver them.

Hitting the accelerator

The review being led by Paul Morell has indicated that the CITB should be retained but needs significant reform. As its new chief executive, I agree with this and have my foot down hard on the accelerator to make this happen. We still have to secure industry’s agreement to continue with the levy, but we are working hard to secure it this summer.

If we achieve this, we will have the launchpad to really make a difference. But more importantly, construction is now talking more seriously about modernisation and I will ensure that the CITB is a key part of that conversation.

This week at the Construction Leadership Council, with Mark Farmer’s vision of a modernised construction industry under debate, we will look at how to deliver it.

I also shared our vision with the CLC for how a new CITB can work closely with our industry to help it to achieve its goals.

The first part of this is behaving differently. We will be much more transparent and accountable, working with employers to agree the outcomes we are targeting and the yardsticks to judge our success.

We will also be more responsive. To give you one example: for a much larger part of the funding we provide, we will work with industry to agree the outcomes and then commission bids to deliver them.

More to come

We are also reforming what we do and how we do it. We will now have a much sharper focus under the three headings of careers, standards and qualifications, and training and development. We will only intervene where we are best placed to make a difference. Last month’s sale of our awarding body – Cskills Awards – was a demonstration of this, but there will be more changes to come.

We will be more forward-looking and evidence-based in how we agree what needs to be done and how to go about it. For example, our report on offsite construction identified the skills and actions needed to realise its opportunities, while our migration research will give industry and government the evidence base to address this complex issue.

This isn’t the first time construction has discussed modernisation and I am not the CITB’s first leader to promise reform. But the prize for success and the risks from failure are now so great that we must act now.

Blog: Invest in the market-facing business while maintaining a strong core

Simon Phillips

Simon Phillips

Simon Phillips, regional managing director of Esh Border Construction, discusses the recent economy growth figures for Scotland.

Last weekend I jumped on the bathroom scales and found I had put on a pound. It came as a bit of shock as I’d been sticking to my health kick. Thankfully though the reading had corrected itself by the following day and I was back where I should be.

Whether it was faulty scales or water retention, it was enough to make me take notice, and it reminded me that we should each have a proactive approach and take responsibility for our personal and business health.

The news that the economy has grown this quarter is clearly welcome, and while the business world can perhaps now sit back and enjoy the summer with the comfort of the 0.8% growth, the reality is that the health of the economy, whether undergoing a 0.2% decline or enjoying a 0.8% increase, is a little delicate.

We have factors we control and factors we can influence, and yes there are factors that are outside our immediate control – for Scotland, clearly one is the revenue from oil.

There is some uncertainty on the economic outlook for Scotland, the UK, Europe, and the world. What I am unsure of is how these fluctuations in growth or decline should affect business strategy in the short-term. The swings in GDP are relatively small and surely we should look at our businesses based upon the opportunities we see rather than with an overtly strong focus on the macro economy indicators.

We don’t weigh ourselves on the bathroom scales as a family – we get on the scales as individuals, and businesses are individual. We need to look behind the weight, or the GDP, and look at our health.

Our view is that there are growth opportunities. Growth in a mature market should be driven by a business being different – offering more and delivering more, and more doesn’t always mean costing more.

Value is what it all comes down to, and it includes how we interact and our delivery, it includes a sense of socially responsibility. If we respect the built environment we believe we can grow.

We can’t build something for half the price; building something for half the price is not a sustainable model for us. It may benefit the client in the short term, but lasting and mutually fruitful relationships with clients aren’t pinned on cost alone.

Whether we are in a boom or the doldrums we need to ensure our businesses are set to grow. Right now, we are investing in the client and market-facing side of our business and watching our back-office costs.

Our business administration is the core of the apple and our client side is the flesh. If you cut an apple through the centre you will get some core, and our job is to make the core as small as possible, but recognise that the administration of the business is like the seeds within the core – absolutely critical. We want great seeds, but a small core.

We are focusing on the market, as that is revenue creation. We will grow our corporate social responsibility, we will grow our business development and bid management, we will grow our design support, we will grow our delivery and through all this we hope we can grow our business.

So, whether the GDP is 0.2% negative or 0.8% positive, it makes little difference to our strategy – our focus in on our long term health, not that extra pound on the scale.