Federation of Master Builders
7 min read11 October 2017
In advance of today’s construction industry roundtable event in the House of Lords, chaired by the Rt Hon Lord Stunell and organised by the Federation of Master Builders, PoliticsHome interviewed Lib Dem Peer Lord Stunell regarding how the Government and industry might mitigate the impact of Brexit on the skills shortage.
A rare consensus has broken out in British politics: we are simply not building enough homes. And while arguments over how to resolve the issue still prevail, industry figures agree that Brexit poses an added dimension to the crisis.
Andrew Stunell, the Liberal Democrat peer, is one of these who’s well attuned to the implications of leaving the EU on the construction industry. The former DCLG minister is a member of the All Party Parliamentary Group for Excellence in the Built Environment, who in July produced a report into the impact of Brexit on the sector.
His main concern over Brexit relates to retaining access to EU workers, who comprise 9% of the UK’s construction workforce (rising to 50% in London). With the free movement of people set to end as the UK leaves the single market, and ministers planning on prioritising high-skilled workers after Brexit, Stunell fears a significant reduction in numbers. At the same time, ministers still plan to build a million new homes by the end of the decade.
“That means the Government’s got two diametrically opposed policies, one of which shrinks the industry, and of which requires it to increase its capacity dramatically,” he says. “It is the workforce problem which is the overwhelming one.” To illustrate his point, Stunell says that, even as things stand, the industry needs to increase its capacity by 35% to meet infrastructure and housebuilding needs. In May, it emerged 147,960 homes were built in 2016/17 – a 10-year high, but still well short of the 200,000-a-year target.
So, how to avoid a significant reduction in the size of the construction workforce? Stunell says ministers must give a “complete assurance” to EU workers currently here that they would be welcome to stay after Brexit. Secondly, he calls for a long-term transition deal (while would ideally be “permanent”, he quips), to preserve existing arrangements. While this takes place, the Government should invest in upskilling UK workers with the skills they need for the future to bolster the domestic workforce.
“We need a lengthy transition deal which understands the needs of the industry. But also, there needs to be a huge investment by the Government and the industry in getting apprenticeships and other training schemes for people needed in the building industry under way,” he says.
And he warns: “The scale of what’s needed is so far beyond what people have been talking about, that I think the Government’s really got to intervene in quite a substantial financial way to make things really happen.”
While leaving the European Union grants a renewed opportunity to encourage UK workers to enter the construction industry, it will take time for them to become fully trained, Stunell says. Perhaps more notably, he queries just how much of an appetite there is among young people to enter the sector.
That’s not to say Stunell, who served as a minister in DCLG from 2010-2012, sees the onus as solely being on the Government. If the construction industry is going to attract the workers it desperately needs in the future, then it must redress its perception among the public. “The fact is that many of the jobs in the construction sector are not valued either by the construction sector itself, nor by UK parents and grandparents,” he says.
Part of the solution, Stunell argues, is for the construction sector to find the self-confidence to declare itself a key part of the “British industrial fabric”. That way, ministers would see the industry as central to ensuring an export-led strategy post leaving the European Union. “The problem the industry has had for years and years, is it’s seen itself as a victim of other people doing things to it. It’s never really been able to convey the visionary aspect.”
He adds: “We are more strategic than the car industry, we are more strategic than aerospace. You can always buy airplanes and you can always buy cars from someone else. But houses, you’ve got to actually build them here. There’s no substitute for a vibrant industry that can deliver the infrastructure and the housing that we need. We need to be much more ambitious about that.”
Stunell also wants answers over future arrangements regarding customs checks, standards and mutual recognition of qualifications for those in the profession with the UK’s EU counterparts. For firms who export services overseas, Stunell would like to see sufficient flexibility allow them to continue to move their workforce around. He would also like to see frictionless movement of goods.
“Is it just going to be a case of driving across the border with a lorry full of whatever it is, with somebody just waving them through? Or is it going to be loads of paperwork, is there going to be a tariff, is there going to be customs to be gone through or not? Every answer that says it’s going to be more work and more hassle and possibly more money, means it becomes more difficult,” he says.
While ensuring minimal disruption to the construction industry from Brexit, Stunell would also like to see a countercyclical approach from government on housing. Rather than reactionary policies formed after the publication of housebuilding numbers, the fruits of which are only felt months after they have been announced, the Lib Dem peer believes the Government should use the independent National Infrastructure Commission to take a broader look at the country’s long-term needs. This would also give small and medium sized firms the oversight and security necessary to make investment decisions on apprenticeships and alike.
“It’s such a short-term and fragmented and dysfunctional set up that we have in the building industry, there’s very little incentive for a small company to invest in long-term training, because you don’t know for sure that you’re going to have jobs to put these people on,” he says.
All this feeds into Lord Stunell’s overarching narrative, that the Government must change how it views the construction sector. Last week, the Tories announced plans to create 5,000 extra nurse training places in the NHS. “Okay, well what are they doing about the massive shortage of quantity surveyors?” he asks. “What are they doing about the massive shortage of architects? What are they doing about the massive shortage of the number of other skills and professional groups in the construction industry, because there won’t be any hospitals for the nurses to work in unless there is a construction industry that can deliver them.”
Indeed, with other sectors such as financial services receiving particular ministerial attention, the Lib Dem peer does not want the housing industry to lose out in any bespoke Brexit deal.
“The first step is for the Government to acknowledge that construction is a strategic industry. We’ve heard in the margins that they’re making strenuous efforts to get the aerospace industry going. We’ve heard it in the margins that they’re doing the same in the car industry with the deal that they have or haven’t offered to Nissan. We’ve heard the same about banking,” he says.
“In other words, the Government does understand that some industries are vital as they need to pay particular attention to them. We haven’t heard a single word to suggest that they get that as far as the construction sector is concerned.
“And yet, to have an export-led boom, you need to have more warehouses, more ports, more laboratories, more offices, more factories, and who’s actually going to put those up? It’s the construction sector. If you don’t have the capacity to deliver that, then you’ve shot yourself in the foot on all the other objectives you set yourself.”
Today, Rt Hon Lord Stunell hosts a construction industry roundtable event organised by the Federation of Master Builders (15:30-17:00, Home Room, House of Lords)