Civil engineers are entering a new era of government policy where the case for investing in infrastructure has been won.
Now the challenge to the sector is to improve delivery.
With the end of 2017 producing a raft of policy announcements impacting the engineering profession, the government has laid out what it wants to see the sector deliver. The overall aim is to drive an increase in productivity to improve the economy.
The policies coming out of the Budget, the Industrial Strategy, the Department for Transport’s (DfT’s) Transport and Infrastructure Efficiency Strategy and the Infrastructure & Projects Authority’s (IPA’s) policy paper Transforming Infrastructure Performance, are all aligned with the outcomes these bodies want to achieve, and how they want them to be achieved. They range from bringing better developed projects forward for funding, to a drive towards offsite construction.
A £600bn pipeline of projects has been laid out, showcasing what civil engineers will deliver over the next decade.
So how should the civil engineering industry respond to the 2017 Budget and the productivity challenge? How should infrastructure modernise to meet the productivity challenge? And is the industry in the right shape to deliver?
That was what key industry figures discussed at the New Civil Engineer Elevating Infrastructure: Leaders’ Summit event in London recently.
“What do we want for that £60bn per year?” asked Infrastructure & Projects Authority senior advisor Keith Waller. “It’s not just about new infrastructure projects, it’s also about getting more out of our existing networks and systems.”
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“It’s a change that moves away from: ‘how do we build things cheaper?’ to how do we build this with a better whole life performance for that asset?”
An important aspect of realising the new vision for infrastructure project delivery is skills.
This was addressed when the construction industry agreed one of the government’s new sector deals announced in the Budget. These are partnerships between the government and industry and are intended to tackle sector-specific issues with the aim of boosting productivity, employment, innovation and skills.
Business secretary Greg Clark has committed £170M of government funding towards construction’s sector deal over three years through the Industrial Strategy Challenge Fund.
Construction firms will add £250M to the government’s contribution in a deal brokered by the Construction Leadership Council (CLC).
It’s not just about new infrastructure projects, it’s also about getting more out of our existing networks and systems
The fund will focus on modernising construction practices through new digital and manufacturing techniques, and on boosting the number of skilled workers through a £64M investment in construction skills training.
Simon Rawlinson is a member of the CLC responsible for strategy, communication and thought leadership.
He is also a partner and head of the strategic research and insight team at consultant Arcadis.
At the time of the debate, details of the sector deal had not been published, but Rawlinson said there had to be a halt in the flatlining productivity growth in construction and that the productivity gap between construction and the wider economy had to narrow.
Focus on digital manufacturing
He says the deal will focus on digital, manufacturing such as offsite construction and smart components and better procurement.
And key will be skills, particularly in the context of Brexit, as well as getting the right deals for the future.
The panel agreed that there was more the industry could do.
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“Industry does spend quite a lot on research and development at the moment, and it does that in quite an uncoordinated way,” said Rawlinson. “There’s a lot of potential in research and development that could be focused.”
Civil Engineering Contractors Association chief executive Alasdair Reisner said the sector wants to embrace the change demanded by the government but has to balance this with a drive to raise margins.
“They need to be able to see that return on investment,” he said.
We really need to do things do things differently and not just talk about it
Linking what the government has said it wants the infrastructure sector to deliver with efforts to make firms operate in a more efficient way and become more financially slick and therefore profitable, has been one of the main backbones of collaboration initiative Project 13.
Hannah vickers crop
Project 13 comes from the ICE’s Infrastructure Client Group (ICG). Its aim is to get the industry to operate on a more collaborative, long-term basis to become more productive and innovative, while developing more consistency and reliability.
Shift to business model
The ICG describes it as moving from a transactional to an enterprise business model. Under the transactional business model which prevails in construction, a project’s supply chain has its relationship defined by the transaction – the amount it is paid in exchange for the service it delivers.
This, according to those behind Project 13, means that keeping costs down is the overriding delivery factor rather than what is best for a project’s lifetime and outcomes. It is argued that if a supply chain works as an enterprise – everyone collectively working together as one business towards the project’s outcomes – the project will be more efficient, more innovative and more productive.
There are more sensors on a Boeing plane than the rail network
This drive for change was met with enthusiasm from key construction suppliers.
Foundation Piling business development manager Paul Hodgson said: “We [the sector] really need to do things differently and not just talk about it.”
It is here where the sector was encouraged to look at other sectors for improvement. ICE head of policy and external affairs Hannah Vickers said that aviation was one example. “There are more sensors on a Boeing plane than the rail network,” she said.
Wavin product manager Martin Lambley said that his company had linked up with vacuum cleaner firm Dyson to share engineering expertise.
So with a drive to do better identified in the industry, and the government committing to invest in the sector via the sector deal and by being a better client, it looks like 2018 could see the start of some long lasting change in the sector.
- Read more about how the engineering industry is ready to respond to the challenge in New Civil Engineer’s Elevating Infrastructure issue, published in December 2017, also available online at newcivilengineer.com
This report is based on a panel discussion that took place in London in December 2017.
The participants were:
Keith Waller senior advisor, Infrastructure & Projects Authority
Simon Rawlinson partner and head of strategic research and insight team, Arcadis
Hannah Vickers policy director, ICE
Alasdair Reisner chief executive Civil Engineering Contractors Association
Gary McGuire head of research and development, Siemens
Davide Stronati global head of sustainability, Mott MacDonald
David Smith chief strategy officer, Stantec
Martin Lambley product manager – water management, Wavin
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