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2017 news review of the year

2017 covers

As the New Civil Engineer news desk wraps up its coverage for 2017, we look back at some of the year’s biggest stories.

This year saw seismic shifts in company ownership, what big clients want the profession to deliver and how engineering holds itself accountable.

It was also a year when what did not happen made the headlines as much as what did. 2017 was the year we said goodbye to the Garden Bridge, the ill-fated idea for a botanic bridge across the River Thames. Crossrail 2 has still to get the big go-ahead it is waiting for from the government, and Heathrow’s expansion plans are again caught up in consultation.

In fact, in a year that could be characterised by a significant amount of stagnation, it was up to our friends across the pond to shake up the world of engineering. Enter SNC Lavalin. Who? Its swift takeover of Atkins rocked the sector and meant we quickly got to know the Canadian giants. But just as things were calming down, Jacobs got the same idea. Its £2.15bn snap up of rival CH2M in August saw its staff grow by an estimated 20,000 to 74,000, and made it one of the world’s largest engineering consultants.

But while the US and Canadian firms were splashing the cash, in a year when the Office of Budget Responsibility had downgraded Britain’s forecast 2017 gross domestic product (GDP) by 0.5% to 1.5%, UK engineering firms were not immune to a combination of economic headwinds and a sector which works on tight margins.

Carillion struggled through profit warnings and its half year financial results in July revealed a £1.15bn loss and a £200M writedown.

The firm was given a huge boost mid-way through the year after it won big in the massive £6.6bn civil engineering contracts awarded to build High Speed 2. It won the C2 lot – North Portal Chiltern Tunnels to Brackley as part of the CEK JV (Carillion Construction, Eiffage Genie Civil, Kier Infrastructure and Overseas).

And project promoter HS2 Ltd’s contract awards kept it at the top of the news agenda for other reasons too, particularly the sticky case of the £170M Phase 2b development partner contract.

In February HS2 Ltd awarded the contract to CH2M. However, the American company subsequently pulled out of the role because of questions of potential conflicts of interest raised by rival bidder Mace. The questions, which were put to HS2 Ltd, concerned its procurement process. The previous HS2 Ltd interim chief executive Roy Hill and now permanent chief executive Mark Thurston had both been recruited from CH2M.

While Labour said in Parliament the staff movements between project promoter HS2 Ltd and CH2M “stinks”, transport secretary Chris Grayling dismissed the reason CH2M pulled out as “not a massive issue” and ignored calls from several MPs for an independent inquiry into the “goings on” at HS2 Ltd. Throughout, HS2 Ltd stood up for the integrity of its procurement process.

With the cash to build HS2 committed, other major projects were looking at different ways to finance themselves and therefore 2017 saw the return of the private finance model. Highways England’s big challenge for 2018 will not just be finding a firm brave enough to tunnel through a World Heritage Site as part of the A303 Stonehenge Tunnel plans: it also needs to drum up investment in some major projects such as the A303 and the Lower Thames Crossing.

Politically it was a somewhat frustrating year, with an election most people would rather forget and Brexit negotiations that were lengthy and complicated. It only picked up at the end with the publication of the Industrial Strategy and budget policies.

From the November Budget onwards, the government swamped the profession with policies and reports. They all boiled down to the fact that the government, as a client, wants to procure better, drive innovation and increase its engagement with the industry so that when a project starts, the desired outcomes are delivered. It all strongly echoed the philosophy of ICE’s Project 13, so with a consensus all round, it looks like 2018 could see the sector finally putting some of its long-standing issues around margins and delivery to bed.

On a more sombre note, 2017 was the year when those working in the built environment were forced to take a difficult look at their own working practices, following the Grenfell Tower fire tragedy.

In the initial aftermath, much focus was on the tower’s refurbishment. However, as the inquiries into the tragedy start to publish their initial findings, it is clear that the repercussions will go deep into the roots of how the sector works. A review led by Dame Hackitt has already concluded that the regulatory systems for designing, constructing and managing high rise buildings are “not fit for purpose”.

These reviews will continue to impact the sector in 2018, but the consensus that working practices must be examined and evaluated in the light of day will hopefully set a precedent for change that will help ensure a tragedy like this never happens again.

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