Industry wins government backing for productivity boost

Construction has been included in government plans to land a sector deal to spend on innovation, research and development.

Business secretary Greg Clark confirmed the deal, worth up to £250m to the industry, under the government’s Industrial Strategy plan.

The deal contains commitments between the government and construction industry to work collaboratively in three key areas: procuring for value, industry-led innovation and skills for the future.

In a statement, the government said: “The deal will substantially boost the sector’s productivity, through greater investment in innovation and skills, creating new and well-paid jobs and maximising its export potential. This will also reduce the environmental impact, improve the efficiency and reduce whole life cost of new projects and buildings to help build the houses, schools, hospitals and major transport projects we need.”

In order to develop skills for the future, the construction industry is set to benefit from both the Industrial Strategy Challenge Fund (ISCF) and National Retraining Scheme.

As announced in last week’s budget, the government has committed to investing a further £725m over the next three years in the ISCF, including £170m to transform the construction sector. It also pledged £64m to digital and construction training as part of the National Retraining Scheme.

Mark Farmer, the author of last year’s report into the construction industry, said: “The UK’s productivity puzzle is at the core of the Industrial Strategy and I am particularly pleased to see that government has recognised the specific importance of the construction industry within this.

“More strategic investment for modernising construction technologies and associated skills and training programmes is most welcome. When combined with the recent autumn Budget announcement regarding the government moving towards a presumption of using modern methods of construction for many of its programmes, this represents the single biggest and coordinated set of measures attacking construction industry modernisation since the publication of the Farmer Review last year.”

Last week, the government said a number of government departments, including the Ministry of Defence and the Department of Health, would prioritise modern methods of construction, such as off-site, from 2019 across suitabvle capital programmes.

Suzannah Nichol, chief executive of Build UK said the commitment to a construction sector deal “demonstrates the strength of partnership we have developed with the government and Build UK looks forward to working…to develop an effective and efficient industry capable of delivering the much needed infrastructure and housing across the UK”.

David Whysall, head of infrastructure south and UK commercial services at Turner & Townsend said the construction sector deal was a major milestone.

“We see the deal as a call to action for the whole industry. It sets a clear agenda for change – under the aegis of the Construction Leadership Council – which focuses on digital technology, increased use of manufacturing, and improving the whole-life performance of assets,” he said.

The other successful sectors in this morning’s announcement were life sciences, artificial intelligence and automotive.