President’s Column – February 2023
At the time of writing this article, 16th January, I read an article on the BBC quoting Anders Opedal (Chief Executive) of Equinor one of Europe’s biggest energy companies, who stated that windfall taxes on energy firms were affecting investments in projects in the UK. “Poor you”, I thought, it must be terrible making pre-tax profits of $24.3bn between July and September compared to $9.7bn in the same period the year before. He was further quoted as saying that he didn’t expect gas and electric bills to return to the levels they were before COVID-19. I’m left wondering how many companies have had to reduce or delay investments due in part to the large increases in energy prices. I think we are all hoping that steelwork contractors will be eligible for the higher level of support suggested in the Energy Bill Discounts Scheme (EBDS). I’m sure the BCSA will be doing everything it can to lobby the Department for Business, Energy & Industrial Strategy (BEIS) on your behalf.
The BCSA is constantly liaising with BEIS and MPs to lobby on the behalf of BCSA members, to inform them what we do and how important we all are in the construction chain, continually delivering a fantastic product to the end client. I understand there is a new Procurement Bill on the horizon. The BCSA and Professor Rudi Klein in collaboration with Debbie Abrahams MP for Oldham East and Saddleworth will be laying an amendment to the bill, which requires contracting authorities to use project bank accounts (PBAs) on their projects where the net value of the contract is over £2 million, ringfenced in a trust arrangement, and ensure that sub-contractors’ retention monies are protected either in the PBA or in a separate deposit account, also held under a trust arrangement. Even taking a cash retention at all means a reduction in cash or a reduction in the amount a company can borrow which hampers all Tier 2 sub-contractors, but at the very least, if retentions are taken these monies need to be protected from the risk of upstream insolvency. It is estimated that approximately £800m of subcontractors’ retentions were lost in the Carillion collapse alone.
The introduction of the Buildings Safety Bill will gather pace in 2023, with the emphasis on proving competence, where we will see the launch in April 2023 of the Industry Competence Committee. On the face of it, our industry is highly competent, so we won’t have too much trouble proving competence, once again the BCSA will be able to provide help with this regard, running refresher training courses and through RQSC for Buildings (which members are already awarded). I’ve never really found incompetence to be the real problem with the steelwork construction industry, it’s more the unseemly rush to get started on a project, the endless drive to squeeze every penny out, and then pressure to complete the works, such that no one party has enough time or money to be able to do their jobs properly, and that is the real villain. A blame culture also effects genuine collaboration, with more thought being how not to be responsible for something rather than the right people getting on with the issue at hand.