With the next water sector investment period due to start in less than a year, recruitment is well under way, as
Jon Masters reports.
The water sector’s supply chain has one year until the start of the next investment period, AMP6, but preparations are already well under way.
There is a shift in emphasis within the business plans for AMP6, towards greater consideration of “totex” (total expenditure) and long term efficiency. Regulator Ofwat has made clear it will be looking for a focus on value for money for consumers when determining what the water companies can invest between 2015 and 2020.
Early appointment of framework suppliers is part of this shifting regime, and this should have a knock on effect on recruitment by smoothing out the cyclical nature of water sector work.
Jacobs, MWH and Atkins have been working for Severn Trent Water since August last year through a 10 year consultancy framework that spans AMP6 and AMP7.
We are looking for technical skills at all levels, but also those that are naturally collaborative
Thames Water also announced a “super-alliance” last year, consisting of two design and build suppliers, programme manager MWH and technology provider IBM.
United Utilities (UU) is the latest of the big water companies to confirm procurement of its AMP6 framework contractors and consultants, announcing that it will be working with four design and build construction delivery partners and a single engineering service provider on an anticipated £3.4bn AMP6 programme.
Potentially, places on the UU framework could last 12 years, although this depends on whether the company hits its corporate targets, says UU engineering director Helen Samuels. The decision about whether to extend the deal will be taken deep into the AMP6 period.
“I know from experience the difficulties caused by this industry’s cyclical nature. We’re looking to smooth the cycle to soften the blow for the supply chain,” Samuels says. “With greater emphasis on totex we’re looking more long term. UU is financing a transitional piece of investment prior to the AMP6 determination to get some projects kicked off early.”
The skills required are changing, says Samuels. There will always be capital investment, she says, but the balance of spend is shifting towards reducing costs, energy efficiency and “getting under the skin” of the unit cost for treatment.
“Our need for professional services partners is reducing because design is going to a D&B [design and build] model, but we need more high-end strategic support and technical governance of the way we maintain and operate our assets. I’m restructuring my engineering department for this,” Samuels says.
In terms of current needs, for MWH at least, the changes do not mean the firm is recruiting massively at present, says MWH strategy director David Smith.
“We’re working with clients on a more planned build-up. I wouldn’t say we’ve smoothed out the cycle yet, but the move to ECI [early contractor involvement] is having a big effect.”
“The plan is to ramp up recruitment over the next 12 months, and when recruiting we’re looking for technical skills at all levels, but also those that are naturally collaborative or can show experience of working this way.”
But what about competition from other sectors? Will water as an industry lose recruits to attractive packages offered by road and rail?
“There is a big new dynamic to this coming AMP6, with challenges of resilience, ageing infrastructure, population growth and finding new and better ways of managing assets. This has got to be done as a balance, which is exciting and invigorating for the industry,” says Smith.
“Engineers thrive on challenges, so this sector will be an exciting and attractive place to be. I don’t see competition from other sectors being much of a problem.”