I have written many times about the luminosity of Mark Farmer (see blogs 5 November 2015, 9 February 2016, 26 April 2016) but he really is a Top Man. He is also very busy. He has just published the Farmer Review, an independent study commissioned by two government departments on the construction skills deficit. In this authoritative piece of work he methodically points out that Britain’s construction industry faces an “inexorable decline” unless radical steps are taken to address its longstanding problems.
The Farmer Review of the UK Construction Labour Model highlights construction’s dysfunctional training model, its lack of innovation and collaboration as well as its non-existent research and development culture. Low productivity continues to hamper the sector, while recent high levels of cost inflation, driven by a shortage of workers, and an ageing workforce has stalled numerous housing schemes as they have become too expensive to build.
We all know the problems. Mark’s plea to the industry is to “modernise or die” and he looks to a 10 point plan to reform which includes creating a platform to address the deep-seated and systemic failures. This includes building more prefabricated homes and building a new “sector within a sector”, building homes in a factory. Well, the construction industry hasn’t raised its game in decades and we urgently need to explore ways to make the work less labour intensive. The obvious answer is through offsite construction. We continue to bang the drum.
So far so good. But a slightly more controversial recommendation set out in the Farmer Review for the medium term is a “carrier bag charge” style behavioural deterrent scheme. This would levy a tax on businesses which buy construction work in a way that doesn’t support industry innovation or skills development. Clients could face paying a suggested levy equal to 0.5 per cent of a scheme’s construction cost but would have the ability to avoid paying this tax completely by commissioning construction in a more responsible way. Mark Farmer says the industry needs to be far more joined-up with its clients in how it approaches R&D and skills. Let’s see if the industry wears it.
But most important of all the recommendations, in my view is that he wants key government ministers to directly intervene in certain areas to ensure many of the issues identified are rectified, for example using the residential development sector as a pilot programme to drive forward the large scale use of pre-manufactured construction, for example, through off-site built or modular housing. This is a powerful play into the zeitgeist of the housing crisis.
Now… we are about to run headlong into the three day extravaganza that is MIPIM UK at Olympia, where the property industry gets together (in something of a mash up) to explore new opportunities, particularly on the investment side, and to debate issues affecting the sector. A number of the exhibitors will be queuing up to become acquainted with our new housing minister, Gavin Barwell. Now, I would imagine that savvy combined authorities or city regions will be ready to put their hands up to implement the Farmer Review in their patch; after all, if you are looking to accommodate thousands of new homes in an urban extension to your town or city, why wouldn’t you stipulate that underpinning that growth should be an off-site construction factory, along with jobs and training opportunities for your local residents?
Thus far Mark Farmer has done an admirable job of carrying a number of government departments, both at ministerial and civil servant level, as well as the majority of the construction and property industry, with him on the journey. We all need to welly in our support to deliver it. Let’s see where we can collectively land this for the good of the economy and the country.