More sites to restart as 73% of big jobs back

Major contractors are now working on 73% of sites as the government renewed its call for construction to restart across the country.

An update from trade body Build UK yesterday revealed the number of operational sites for its contractor members – up from 69% last week.

Build UK’s membership includes most of the industry’s biggest names like Balfour Beatty, Laing O’Rourke, Kier, McAlpine, Skanska, Bouygues, Bam, Vinci, Wates, Mace and Morgan Sindall.

Over 80% of member’s infrastructure and construction sites are now running with 55% of housing jobs working.

The latest numbers came as Secretary of State for Housing, Communities and Local Government Robert Jenrick restated the government’s position on construction as one of the sectors leading the economy out of lockdown.

He said: “We want infrastructure and construction work to begin again wherever it is safe to do so.

“We cannot, and will not, let this pandemic halt our work to improve connectivity, to provide vital social and cultural infrastructure and to boost economic growth across the regions.

“That’s is how we will begin to rebuild and recover from this national emergency.”

Build UK also reported that productivity is improving on reopened sites.

Productivity on infrastructure and construction sites is averaging 71%, up from 67% last week.

But sites in London remain a challenge although output has improved from 56% to 63% in the last week.

Article courtesy of ‘Construction Enquirer’

IR35 legislation deferred until 2021

The government has postponed the introduction of the planned changes to the controversial IR35 legislation, which implements heavier tax burdens on freelancers and the self-employed. The new rules will now come into force on 6 April 2021, as opposed to the same date in 2020.

Speaking to the House of Commons on the evening of 17 March, chief secretary to the Treasury Steve Barclay (pictured) said: “The government is postponing the reforms to the off-payroll working rules, IR35, from 6 April 2020 to 6 April 2021.”

Addressing the Commons, Barclay said the suspension is in response to the ongoing spread of Covid19 to help businesses and individuals. He said: “This is a deferral, not a cancellation, and the government remains committed to reintroducing this policy to ensure people working like employees but through their own limited company, pay broadly the same tax as those employed directly,” he added.

Andy Chamberlain, director of policy at the Association of Independent Professionals and the Self-Employed (IPSE) said the government has done “the sensible thing” by delaying the changes to IR35 in the private sector.

In a statement released late Tuesday evening, Chamberlain said: “These changes have already undermined the incomes of many self-employed businesses across the UK. However, they would have done even more serious damage if they had gone ahead as planned.

“It is right and responsible to delay the changes to IR35 for at least a year during the coronavirus [Covid19] crisis, to reduce the strain and income loss for self-employed businesses.

However, Chamberlain has reaffirmed that more needs to be done to support self-employed businesses and has called for an emergency Income Protection Fund. He said: “This is a sensible step to limit the damage to self-employed businesses in this grave and unprecedented situation, but we also urge the government to do more. It must create an emergency Income Protection Fund to keep the UK’s crucial self-employed businesses afloat.”

Nuttall and Ferrovial to replace Carillion on HS2 work

BAM Nuttall and Ferrovial Agroman have been drafted in to strengthen the Kier and Eiffage joint venture preparing to start work on two civils packages worth nearly £2.5bn in the first phase of HS2.

C2 and C3 contracts will cover an 80km stretch of the central HS2 section
C2 and C3 contracts will cover an 80km stretch of the central HS2 section

The two firms will replace Carillion, which was the third partner in the original consortium to secure C2 and C3 contracts in the central section of the project.

Lot C2 will see the construction of the north portal Chiltern tunnels to Brackley, while Lot C3 is for the Brackley to Long Itchington Wood Green tunnel south portal.

Since the two contracts were let the combined value has soared from £1.34bn to £2.48bn.

The new team of contractors will deliver an 80km stretch of HS2 through the countryside, from Wendover in the Chilterns to Leamington Spa.

The route includes 42 km of cuttings up to 30m deep and 27 km of embankments up to 13m high. The firms will also build 70 over-bridges, 15 viaducts, 15 under-bridges and three Green Tunnels with a total length of about 6.5km.

Bam Nuttall and Ferrovial were previously part of the Fusion consortium with Morgan Sindall, which unsuccessfully bid for the northern and southern sections of HS2 phase one.

HS2 avoided going out to public tender again, because EU procurement rules allow for replacement to be appointed in the event of insolvency.

Chiefs at HS2 also argued that re-procurement would also be unfair to surviving partners Kier and Eiffage.

Skanska rail and highways maintenance for sale

Skanska is pulling out of the rail, highways and lighting maintenance markets to concentrate on core building and infrastructure construction.

It has now begun the process of marketing its infrastructure services operations to potential buyers.

Skanska said it would only consider bids that protect contract delivery and teams.

Gregor Craig, president and CEO of Skanska UK, said: “We have a strong platform for the future as a result of our financial resilience, selective work winning and disciplined management.

“We have decided to streamline our UK operations to focus more on our core infrastructure and building markets and create greater alignment between Skanska’s UK activities and its approach in global markets.”

Skanska said it would remain fully committed to the delivery of all current contracts throughout the sale process, and would do all it could to minimise any impact and ensure a seamless transition once a buyer is identified.

 

It is the second time the UK arm of the Swedish construction giant has sought to sell part of its business.

Nearly two years ago piling arm Skanska Cementation was marketed with a price tag north of £50m. But after failing to agree on a price with prospective buyer concrete contractor Morrisroe, the foundation firm was retained.

The government has launched a review of freelance tax rule changes due to come into force in April

Looming changes to IR35 rules are causing widespread concern in construction.

HMRC rules are due to change from April 6 making contractors liable for determining the tax status of off-payroll professionals.

Major contractors have been auditing freelancers employed via personal service companies as thousands of professionals are braced for a move back to PAYE.

The government is now calling for evidence from affected individuals and businesses to ensure “smooth implementation of the reforms.”

Financial Secretary to the Treasury Jesse Norman said: “We recognise that concerns have been raised about the forthcoming reforms to the off-payroll working rules.

“The purpose of this consultation is to make sure that the implementation of these changes in April is as smooth as possible.”

Current rules allow workers to be employed via a personal service company (PSC) which determines whether IR35 tax rules should apply.

That responsibility is due to shift from April to contractors who will determine employment status.

Freelance workers fear they will lose out through higher tax payments while contractors will also face bigger bills from direct employment.

The government is also reviewing its Check Employment Status for Tax (CEST) online tool which has attracted widespread criticism.

Chancellor Pledges Review of IR35 Changes

Chancellor Sajid Javid is promising to review looming freelance tax rule changes which are causing widespread concern in construction.

HMRC IR35 rules are due to change next April making contractors liable for determining the tax status of off-payroll professionals.

Major contractors have been auditing freelancers employed via personal service companies as thousands of professionals are braced for a move back to PAYE.

But Javid told the BBC Radio 4’s Money Box programme “We’ve already said that we’re on the side of self-employed people.

‘We will be having a review and I think it makes sense to include IR35 in that review.”

Current rules allow workers to be employed via a personal service company (PSC) which determines whether IR35 tax rules should apply.

That responsibility is due to shift from April to contractors who will determine employment status.

Freelance workers fear they will lose out through higher tax payments while contractors will also face bigger bills from direct employment.

One industry expert said: “They are desperate for any vote they can get so alienating a million freelancers is not a good idea.”

HS2 review ‘could axe part of northern route’

HS2-High-Speed-2-train-track-design-CGI-_660-620x330.jpg

The northern leg of HS2 could be scaled back, it has been reported.

The Financial Times said that the Oakervee review is examining the possibility of axing phase 2b of the route from the East Midlands to Leeds and Sheffield.

The review is assessing factors including whether the project should continue, what its cost will be and the route it should take.

Leeds City Council leader Judith Blake said: “There will be grave long-term consequences for the economy of the north and east of the UK if the eastern leg of HS2 isn’t delivered in full.”

The FT also reported that the panel is also looking at cutting the speed of the trains by 40mph in an attempt to save £10bn, and looking at starting the line at Old Oak Common rather than Euston.

Labour peer and former head of the National Infrastructure Commission Lord Andrew Adonis said he would try to ask about the reported change in the House of Lords this afternoon.

He said: “I’m hoping to ask in the House of Lords today about the front page suggesting that the eastern leg of HS2 to Leeds, Sheffield, Nottingham & Derby might be cancelled. This is a really terrible idea even by Johnson’s standards.”

A report by Midlands Connect last month said that 73 stations, including 54 with no direct HS2 service, are set to benefit from the project if it is completed in full.

At the time, Sir John Peace said: “It is the capacity released by the line, not just its speed, that will give the whole network a desperately needed overhaul.”

HS2 confirmed last week that it has halted the felling of 11 ancient woodland sites until the Oakervee-led review has concluded.

The panel is expected to conclude its report later this month.

A spokesperson for the Department for Transport said: “We are not going to pre-empt or prejudice this work with a running commentary on the review’s progress.”

HS2 has been contacted for comment.

Skanska prepares for world record pipe-jacking task

A Skanska-led joint venture is starting to prepare the way for a record-breaking pipeline push 30m below the River Humber for National Grid.

Eight 610m sections of concrete cased pipes will be pushed through Humber River tunnel
The firm has just completed the 18-month first stage tunnel drive for the £100m gas transportation project slightly behind programme.

Now preparation work is getting underway to attempt the challenging pipe-jacking feat.

This will involve painstakingly pushing eight, 610m sections of pipe at about one metre a minute through the 5km tunnel.

Before the two hydraulic thrust machines start the epic task next spring, the team must first dismantle the 3.65m diameter TBM Mary.

Steve Ellison, lead project manager of Capital Delivery at National Grid, said: “It’s the first time a tunnel has been constructed beneath the River Humber and a fantastic achievement for everyone involved.

“Over the next few weeks we’ll be dismantling the tunnel boring machine and lifting her out of the ground in sections, ready to be transported back to Germany, where as much as possible will be refurbished and renewed to get her ready for her next tunnelling job.

“The next steps for us here under the Humber involve clearing the pipes, cables and ancillary equipment that has been servicing the tunnel boring machine and preparing for the world record-breaking pipeline installation early next year.”

Hydraulic thrusters will be installed at the Goxhill site on south side of river for the epic pipeline push

The 850-tonne sections of pipe will be pushed on rollers into the new tunnel from Goxhill on the south side. To aid installation the tunnel will be flooded with water.

When one pipe section has been installed, the next will be moved into position, welded to the one in front, and the push will continue until all of the pipeline is installed beneath the river.

When complete it will be the longest hydraulically inserted pipe in the world.

Counter Offers: To Stay or Not to Stay?

For those unfamiliar with the basic definition; the counter offer is a last-minute bid by a company to retain an employee who has handed in a notice of resignation.

Over the years we have seen many a counter offer put on the table from frantic employers and in this article, we are going to cover both the positives and negatives of accepting; whilst shining some light on the subject.

And In the famous words of The Clash, “Should I stay or should I go now?”

What is a Counter Offer?

A counter offer is an attempt to entice an employee to stay with their employer after they have received an offer for another job position. The counter offer can consist of a raise to salary, an increased benefits package (company car, bonus, etc.), a promotion or new role within the company or just a few words of reassurance and promises of a brighter future. This is done in the hope that this increased ‘deal’ will change the employee’s mind and get them to stay.

Pros of Accepting a Counter Offer

  • The straightest forward counter offer is financial and this tends to benefit employees who are generally happy with their job but feel they are being financially undervalued. This can be resolved by their employer increasing the employee’s annual salary or some of the other financial benefits.
  • If the dissatisfaction runs deeper and is widely felt then a benefit of a long-term, highly regarded employee resigning their post is that it can give a wakeup call to their employer which can lead to change that, not only benefits the individual, but also the overall team. Whilst no one person is bigger than a company, losing key staff can be very disruptive and costly so making a few changes to improve the general feeling can be a benefit to both employer and the team.
  • Where the issue goes beyond finance and self-worth then the employee may be looking for more responsibility and a new challenge. When recruiting, the natural tendency for many employers is to look outside whilst overlooking existing staff who may have transferable skills. A resignation could, therefore, start talks regarding a step up or it could open doors to new responsibilities whilst putting plans in place for further career progression. This can leave the employee in a better position, knowing that their aspirations are being considered and that there is potential to progress within the company.

Cons of Accepting a Counter Offer

  • Financial gain tends to be short-lived once the shine of an increased salary wears off and the extra money has been absorbed into our daily living. Once this happens the other reasons for our dissatisfaction starts to resurface and it’s only a matter of time before we are scrolling through the job advertisements again. Statistically, over 70% of people who accept a financial counter offer start looking for a new job within six months either because of their renewed unease or (in recessionary times) an unexpected redundancy notice.
  • However well regarded an employee is, they are rarely viewed the same by an employer after a counter offer, who may now feel let-down at having been put in that position; and who may forever question the employee’s loyalty. This often shows up when salary reviews, bonus payments and promotions come up; or when cut backs in the company occur.
  • Beware the promise of a brighter future that comes in the form of a promotion or new role ‘in six months’ time’ or ‘once your current project completes’. Talk is cheap and often the promise of change simply buys the employer time to plan for the employee’s departure and line up a replacement.
  • Even if a pay increase or promotion IS forthcoming then consider why it has only been offered in a last-minute bid to stop you from leaving rather than in authentic and planned recognition of your value to them. If your employer knew about your concerns or wanted to improve your circumstances then why did they leave it to such a late stage, and will it take another resignation to get that next increase? Similarly, how will your colleagues feel towards you knowing that you strong-armed your position?
  • For me, the biggest downside is often overlooked. To get to the resignation stage, it’s likely that you invested time in finding and interviewing for a position that you wanted, with a company that you liked; and to whom you suggested (at least verbally) that you would be accepting their offer. Companies rarely enjoy feeling as though their offers have been used and often disregard future applications from those that have ‘let them down’.

There are always pros and cons to decisions and sometimes a counter offer can occasionally be a great opportunity for change while often it’s a quick fix for 6 months before the original feelings return even stronger and it’s back to square one.

If you’re considering new opportunities then head over to our jobs page where you will find an extensive list of current available vacancies, alternatively call either our London or Midlands offices, we’d be pleased to hear from you.

 

Amey to pay £215m to exit Birmingham highways PFI

Amey is close to striking a deal that could see it stump up £215m to walk away from its troubled Birmingham highways maintenance PFI contract.

Birmingham City Council chiefs are understood to have agreed a proposal with the highways maintenance contractor, which will be formally ratified next month.

It is understood that Amey could pay £130m in cash up front, with a further £85m in staged payments over five years.

Also Birmingham City Council would hold £85m of deductions and penalties imposed on Amey, which have been subject to legal disputes between the two.

Together this would amount to a £300m divorce settlement for the council from Amey’s Spanish parent Ferrovial.

Amey has been locked in a five-year legal battle with the council over performance on its £2.7bn PFI deal. This has already seen Amey Highways suffer serious losses.

The Spanish infrastructure group is aiming to sell-off its UK support services business Amey but the 25-year PFI contract has proved a major obstacle.

A council spokesman would not confirm leaks to Sky News of the proposed deal but said:  “It is now generally accepted by all parties to the contract that in order to move forward Amey must be replaced with a new subcontractor.

“This will require a managed release and handover to a new provider along with an appropriate settlement to rectify the liabilities Amey proposes to leave behind.

“While the terms of this settlement are yet to be agreed and would be subject to further agreement by the Council’s Cabinet, talks in recent days have established how an acceptable settlement could be reached and we will continue to work with all those involved to achieve an acceptable solution.”

An Amey spokesman said: “We are encouraged by recent progress and appear to be arriving at a deliverable solution guaranteed by Amey.

“The next few days are critical to finally concluding this issue.”