The Construction Sector Deal – investment in “bytes and mortar”

On 5 July 2018, the Government announced its Construction Sector Deal worth £420 million to transform the UK construction industry by improving productivity through greater investment in innovation and skills.  A copy of the Construction Sector Deal is available here:

The Construction Sector Deal is part of the Government’s Industrial Strategy and is an ambitious partnership with the construction industry, through the Construction Leadership Council.  The construction sector, including the supply chain and professional services, had a turnover of £370 billion in 2016 and employed around 3.1 million workers, or around 9% of the UK workforce. The sector also exported over £8 billion of products and services.  However, it is widely recognised that the potential of the sector has been held back by its productivity especially as compared to other sectors.  The Farmer Review in 2016 recommended that transforming the industry would need shared leadership by the industry, clients and the Government.  The Construction Sector Deal is intended to achieve this goal and also build on ‘Construction 2025’ published in 2013.

 The Construction Sector Deal will deliver:

• £420 million investment in what it calls “bytes and mortar smart construction” through use of digital building design, new manufacturing technologies and offsite manufacturing helping cut the time taken to deliver new build by 50%. Industry will be contributing up to £250 million with a £170 million injection from Government through the Industrial Strategy Challenge Fund
• Support for the objective in the Clean Growth Grand Challenge to at least halve the energy use of new buildings by 2030, helping families to save money and making the UK a leader in clean, green sustainable construction
• Commitment to 25,000 construction apprenticeship starts and 1,000 Construction T Level placements by 2020 – with £34 millon to scale up innovative training models across the country
• Improved access to a $2.5 trillion global export infrastructure market

The Construction Leadership Council will lead on the implementation of the Deal and publish an annual report.  The Construction Leadership Council, government and various subgroups will also work on a delivery plan.

Comment 

This is an ambitious programme so will it deliver?

The Construction Sector Deal is the biggest investment in the industry in a decade and it is thought that digital techniques and offsite manufacturing will revolutionise construction and address the productivity issue.  The commitment to innovation and improvement is also intended to help industry respond to the recommendations in the Independent Review of Building Regulations and Fire Safety published in May 2018 to improve the sector’s health and safety culture to deliver high quality, safe buildings.

The investment is significant.  However, the Deal recognises that the construction industry itself  needs to move to new business models based on collaboration and more efficient and better integrated supply chains to achieve its goals.