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Cautious optimism for £420M construction sector deal

construction site

The industry has broadly welcomed the long-awaited £420M Construction Sector Deal, although some have warned its ambition must be matched by action.

Originally due in January, the deal will push the construction industry towards better efficiency with offsite manufacturing and digital design taking top spots on the agenda.

As well as focusing on better efficiency, the deal pledges to steer the industry towards designing more efficient buildings in line with the government’s Clean Growth Grand Challenge mission to halve the energy use of new builds by 2030.

The £420M is made up of £250M of funding from construction firms and £170M of government funding. Sector deals were revealed as a key part of the government’s Industrial strategy, published in November last year.

The Construction Leadership Council (CLC), which played a key role in shaping the deal, said its publication “marks the start of a partnership between Government and the Construction Sector that will accelerate the drive towards modern methods of construction”.

CLC chair Andrew Wolstenholme said: “By bringing together government construction programmes, pooled R&D funding and a shared commitment to improve business models and skills, the Construction Sector Deal announced today [Thursday] represents a huge opportunity for our industry to come together to invest in our future. This is an opportunity that we cannot afford to pass up.”

The Institution of Civil Engineers (ICE) said it was pleased the government had recognised its work on Project 13.

ICE director General Nick Baveystock said: “We welcome, in particular, the focus on creating a new sustainable business model for construction, which the report recognises is in line with the work we have been doing on Project 13.

“This industry-led initiative has created a model that will boost certainty and productivity in delivery, improve whole life outcomes in operation and support a more sustainable, innovative, highly skilled industry; all things the Sector Deal has emphasised are needed.”

However, several experts were cautious in their responses. ACE chief executive Nelson Ogunshakin OBE cautioned that the deal’s ambitions had not yet been proven.

He said: “Of course reducing new build delivery times by 50% is a welcome announcement, but time will tell whether this is an aspirational target, or a realistic deliverable.

Law firm Ashurst construction partner Ben Patton agreed with Ogunshakin, and added the industry has “some way to go” before that goals set out in the deal are realised.

Patton said: “Post-Carillion and in light of the issues with the industry’s depleting workforce, it’s imperative that the ambition behind the much anticipated £420m Construction Sector Deal is matched with results in order to meet the needs of the industry and drive the necessary transformation in productivity. In practice, I think we still have some way to go.”

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