The Merry Month : Who will do all this work?
Robert Merry, is an independent stone consultant and project manager who ran his own company for 17 years. He also acts as an expert witness. Here he presents his view of the stone industry this month.
18 June, the Guardian: Refurbishment of Parliament will cost £3billion. The 150-year-old ‘Mother of Parliaments’ has a few problems – asbestos, the cabling is outdated, the stone’s crumbling in places and it’s sinking.
18 June, BBC News website: To refurbish Parliament will cost £5.7billion and take 32 years if the MPs don’t move out; £3.5billion if they move out and run Parliament from Birmingham or across the road; £4.46billion if they move out and have a slightly higher specification. The highest conceivable cost, taking into consideration maximum risk, inflation, et al – £7.1billion.
Couple that with this headline in Building magazine a week earlier (12 June): “The Price is Wrong – why did QSs fail to predict the speed of construction cost rises?” It is followed by the comment that “failure of QSs has led to clients being faced with costs as much as 10% higher than tender forecasts”.
Mike Hussey, Almancatar Chief Executive, the developer behind Centre Point in central London, predicts real London construction inflation of 15-20% – three times the 6-7% generally predicted.
The client employs construction management companies to provide cost plans for their developments, with teams of quantity surveyors working out the costs before the client goes to market. Contractors’ tenders come back 10% higher than the cost plan and, naturally, the client is not best pleased.
So how much do we really think the refurbishment of the Houses of Parliament will eventually cost?
If they take the 32 year option, can anyone seriously sit down and predict the cost with any certainty? I suspect those currently working up the figures (like me) will have long ago substituted the hurley-burley of the construction industry for comfy slippers by the time the final bill is paid.
And who, exactly, is going to carry out the work? The Construction Industry Training Board (CITB) estimates that there will be 224,000 new jobs in construction over the next five years. That’s 45,000 a year, approximately. Last year a new low of just 9,306 completed construction apprenticeships, potentially leaving 35,000 jobs unfilled.
The government has pledged to increase the number of apprenticeships to 3million across all sectors. That works out at 210,000 for construction if you use construction’s current 7% share of the GDP as the calculator.
That’s a huge increase in construction apprenticeships and will take monumental organisation. Not to mention the fact that they have to complete the apprenticeships before they can start to make a significant contribution.
Skilled migrant labour might help to ease the pressure. Apparently it currently represents 10% of the construction labour force. But what impact will the government’s plans to cap immigration have on that source of labour?
David Cameron is trying to negotiate further restrictions on the freedom of movement from EU countries. What will happen if we leave the EU altogether? Architects Pringle Brandon Perkins + Will (for instance) have a London office with more than 40% of its staff from overseas. Will they lose them? It would be disastrous for any business.
The other major resource we have failed to attract to the industry in any significant numbers is the other (presuming you are not part of it) half of the population – women.
It is said that 99% of workers on building sites are men. The building site is notoriously sexist. Add on the dirt and dust and the general condition of most site toilets and it could be some significant number of years before that figure increases.
So we have rising costs we can’t predict for building work we don’t have the resources to carry out. Am I mad, or is it the rest of the world?
Please don’t answer that. Or if you do, build in a margin of error… say 10 to 15%?