The SEC Group, an alliance of subcontractor associations, has identified the issues of procurement, payment and professionalism as key to improving growth and productivity in the construction industry.
In spite of countless reports and initiatives the industry’s procurement and delivery processes remain as adversarial and non-collaborative as ever with billions of pounds lost through process waste such as needless re-work, the SEC Group said. It will therefore be calling on public and private sector construction procurers to submit new projects for piloting alliancing arrangements underwritten by integrated project insurance with the aim of achieving up to 20% savings.
Late payment continues to be a major issue too. Several large construction companies are in financial distress and spreading their pain, with payments to SMEs taking longer and longer. SEC Group will be inviting both public and private sector clients to use project bank accounts to quicken the flow of cash to the supply chain. SEC Group is also promoting a private member’s bill in the House of Commons this month to protect cash retentions.
Construction industry professionalism was exposed in 2017 as hugely lacking, with high profile failures in design and construction exposed by the Cole Report into the Edinburgh schools’ failures and Dame Judith Hackett’s interim report on the review of the building regulations, prompted by the Grenfell Tower fire.
SEC Group will be pressing the government this year to consider a statutory regime for corporate competence similar to construction licensing schemes in the USA and Australia. A licensing scheme, based upon current trade association schemes, will help to professionalise the industry, it believes.
SEC represents the British Constructional Steelwork Association, the Building Engineering Services Association, the Electrical Contractors Association, the Lift & Escalator Industry Association, the Electrical Contractors Association of Scotland (Select) and the Scottish & Northern Ireland Plumbing Employers’ Federation.
SEC Group chief executive Rudi Klein said: “We are in desperate need of a new and re-vitalised impetus to help make the industry leaner and fitter to meet many challenges ahead especially investment in digital and manufacturing technologies.”