The Week That Was - 22 September 2023
Welcome to The Week That Was, a round-up of key events in the construction sector over the last seven days.
HS2 Manchester leg could be scrapped
Contractors have warned of the UK becoming an "international laughing stock" if the northern leg of HS2 is scrapped.
According to an Independent report, which focused on a photograph of a leaked document, Rishi Sunak and Jeremy Hunt are considering scrapping the project's second stage. This could save £35bn in tax cuts ahead of the next general election. Downing Street's failure to promise that HS2 will operate as planned to Manchester further fuelled these rumours.
The construction industry has been quick to react. Alasdair Reisner of the Civil Engineering Contractors Association warned that that the move would undermine the UK net zero goal for 2050, and stated that “No British Government has made such a short-sighted and self-harming decision since Harold Wilson’s administration stopped work on the Channel Tunnel in the mid-1970s."
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House of Lords block pollution reforms
Orders from the Government agency, Natural England, have led to over 60 local authorities restricting housing development in certain areas. These orders are aimed at controlling phosphate and nitrate pollution of rivers.
A previous plan to relax these rules has now been blocked, with the House of Lords voting to reject a Government amendment to the Levelling-up and Regeneration Bill.
The Home Builders Federation (the HBF) commented that "despite the fact that new homes make a negligible contribution to the nutrients issue, around 150,000 homes across the country remain on hold" following the Lords' vote and “whilst doing nothing to reduce the disgraceful pollution of our rivers the ban is deepening our housing crisis, reducing economic activity and costing jobs."
New research by the HBF indicates that one billion pounds in cash contributions have been provided by developers to water companies, to support upgrades to water provision and wastewater treatment.
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UK's top contractors return to pre-pandemic performance
The 2023 CN100 list shows that pre-tax profit, turnover and margin have risen above pre-pandemic levels for the UK’s top contractors. The aggregate revenue of companies in the 2023 list reached £71bn, while average pre-tax profit rose by 25%. There was a year-on-year increase of over 50% for average profit margin. 55 of the firms in this year’s table saw pre-tax profit grow, and 46 were able to broaden their margins.
However, in the cash-in-hand and net cash categories, the aggregate figures were marginally lower than last year. That being said, the figures give the overall impression that the sector is recovering from the challenges of the last few years.
More information can be found here.
Building Safety Act 2022 (BSA): A reminder of the provisions coming into force on 1 October 2023
The Building Safety Act 2022 (Commencement No 5 and Transitional Provisions) Regulations 2023 (SI 2023/993) come into force on 1 October 2023. These regulations implement various sections of the BSA, which will bring into effect a new building safety regime overseen by the Building Safety Regulator. They will also bring into force the statutory requirement for existing higher-risk buildings to be registered by 1 October 2023. More information can be found here.
The Building Act 1984 (Commencement No 3) (England) Order 2023 (SI 2023/992), which applies only to England, also comes into force on 1 October 2023. The Order brings into force section 33 of the Building Act 1984, as amended by the BSA 2022. Section 33 gives building authorities the power to test and sample work. It replaces and extends existing powers afforded by regulations 45 and 46 of the Building Regulations 2010.
More information can be found here.
Second edition whole life carbon assessment standard published by RICS
RICS have published an updated version of its Whole Life Carbon Assessment for the Built Environment (WLCA). First published in 2017, the guidance – which is produced by world leading experts on decarbonisation - mandates a whole life approach to reducing carbon emissions within the built environment. The WLCA is intended to enable an assessor to estimate the amount of carbon emitted throughout the life cycle of a constructed asset. It is hoped that this degree of visibility will help manage carbon budgets and, ultimately, deliver a net – zero future.
Containing extensive revisions, the new edition is intended for use by a wide range of professionals, from investors and lenders through to contractors and developers. According to Charlotte Neal, RICS director of surveying standards: “The built environment has been crying out for tools to measure its impact on climate change, which is crucial for developing mitigating practices to significantly reduce the industry's carbon output. By providing a consistent methodology to assess the carbon output of buildings throughout their entire lifecycle, the second edition of WLCA will significantly improve the industry's ability to measure and manage its impact on climate.”
For more information, please see here.
Vinci to redevelop St Helens town centre
Vinci Building have been appointed to lead construction of the £90m first-phase regeneration of St Helens town centre. The project will include a new market hall, with a mixed-use area and a 120-bedroom globally branded hotel. The plans also provide for 64 new homes, a 11,000 sq ft modern retail space, and sustainable public spaces.
The existing bus station will be replaced with a new modern multi-modal interchange, together with active travel improvements across the wider town centre. Works are intended to start in 2024, subject to a more detailed planning application that is being submitted shortly.
John Roberts, Managing Director of VINCI Building said: “This is a fantastic opportunity for VINCI Building to showcase our technical expertise in town centre regeneration. This project allows us to increase our social value commitments and add value within the borough and surrounding Liverpool City Region."
For more information, please see here.
Authors for this week's edition: Hannah McDonagh, Ella Crawley-Till, Harry Langford-Collins and Nazia Mohammed
Disclaimer: The information in this publication is for guidance purposes only and does not constitute legal advice. We attempt to ensure that the content is current as at the date of publication, but we do not guarantee that it remains up to date. You should seek legal or other professional advice before acting or relying on any of the content.