The vital role that the construction sector plays in supporting the country is clear to see, it represents over 6% of all GDP and 7% of the UK’s total workforce which is spread right across the country. You only have to look at the COVID-19 crisis to see the importance of our infrastructure and construction in the wellbeing and prosperity of citizens right across the country.
Despite the important role that the construction industry plays, it is not living up to its full potential. It remains the least productive industry in the UK economy, at more than 20 percentage points below the average output per hour for the whole economy in 2017 and many building sites in the UK would be recognisable to our Victorian forebears.
It has never been more urgent to transform and modernise the construction sector. The government has made it clear that it will utilise infrastructure and construction to rebuild Britain and fuel economic recovery across the UK. This will mean building back better, greener, and faster, as recently set out in the National Infrastructure Strategy.
Principle number seven; “be an intelligent client”
As I set out in my previous blog, the recently published eight principles for project success are designed to be core principles that underpin successful project delivery in government. Principle number seven; “be an intelligent client”, concisely sets out the role government has in establishing and encouraging the behaviours that will transform the construction sector and the delivery of our major projects.
To be an intelligent client we must be clear in what we expect, work with the whole supply chain and industry, and most importantly, build trust-based relationships with the supply chain and partner organisations.
As the construction sector's biggest client, the government is in a unique position to support the transformation and modernisation of the sector. Government must ensure the way we buy construction services is fit for the future. That means being clear about the behaviours and outcomes we expect from suppliers and contracts and making innovation a core requirement. Government holds considerable influence over the sector, with over 30% of new construction contracts over the last decade coming from the public sector. By unleashing its full potential, government can support the sector to ultimately deliver the ambitions that will benefit every corner of the country.
But the government does not have all the answers. In exchange for taking a longer view and providing stability to invest, we will expect demonstrable results on our projects. To deliver economic renewal we need the industry to emerge from this crisis stronger than ever. This is the opportunity for them to rise to that challenge. This means a commitment to prioritise reforms that will improve resilience and encourage more innovation.
In line with that ambition, the government published the Construction Playbook this week.
We have built on the great collaboration that has taken place following COVID-19 by developing the Construction Playbook through extensive engagement with industry and the public sector at every stage of development through over 1000 hours of engagement.
The Construction Playbook is designed to transform the way in which we assess, procure and deliver public works projects and programmes. It introduces key policy reforms and guidance for central government departments and their arms length bodies and sets out what is expected from industry.
For example, the government will incentivise industry to innovate by setting clear and appropriate outcome-based contract specifications, and we will support industry to invest by providing greater certainty of demand with longer term contracting across portfolios.
Finally, and most importantly, the Construction Playbook will also support in developing a consistent and mutually beneficial relationship with industry, and contract management which will deliver continuous improvement over time.
Moving towards a bright future
With everything considered, it is clear that both the government and the construction sector need to step up collaboratively to transform and modernise. Government has a vital role to play as the construction sector’s biggest client and the construction sector must respond positively to what is expected in return.
Great strides have been made recently and the response to COVID-19 is testament to what can be achieved if we work collaboratively. However, there is much more to do if we are to fully unleash the true potential of the construction sector and ultimately support the vital rebuilding of the country.