Memorandum submitted by the Building Services
Research and Information Association (BSRIA)
INTRODUCTION TO
BSRIA
BSRIA is a private sector, non-profit distributing
Association of some 650 member companies. It primarily serves
the technical and information needs of the specialist engineering
disciplines covering heating, ventilation, air-conditioning and
many other aspects of comfort in the built environment.
BSRIA is primarily funded through private sector
consultancy and trading activities and has a turnover approaching
£10 million per annum.
This response has concentrated on delivering
evidence to the committee on three of the nominated topics:
1. Construction sector performance (specifically
key performance indicators and productivity).
2. Encouraging sustainability (specifically
the role of BREEAM, the role of the energy utilities, ways to
improve the performance of new and existing buildings, and government
policy on renewable forms of energy).
3. Construction research and development.
Key conclusions and recommendations are highlighted
in bold text.
1. Construction sector performancekey
performance indicators
1. BSRIA carries out on-going research into
the performance of the UK building services industry on behalf
of the DTI. The headline key performance indicators (KPIs) include
data on delivery of design, installation and service, reduction
of defects, and predictability of time and cost. Metrics on productivity
and safety are also obtained.
2. The 2006 KPIs revealed a trend away from
procurement on a lowest price basis (31% in 2001 to 16% in 2006)
and greater evidence of negotiated contracts (from 22% in 2001
to 36% in 2006). This reflects the government's desire to see
a greater emphasis on quality rather than lowest price.
3. However, price remains the dominant selection
criterion in 64% of cases. In 2006, 48% of clients selected a
building services contractor on a price or quality basis. This
suggests that price remains the dominant selection criterion.
4. Even so, BSRIA has clear evidence that
levels of client satisfaction with service in projects procured
on a price-only basis are far compared with those that are negotiated.
5. The prevailing practice of selecting
on lowest price militates against the government's commitment
to carbon-dioxide reduction strategies and life-cycle costing.
A constrained capital budget cannot easily accommodate the additional
design effort and/or carbon-dioxide reduction technology that
is required, such as solar power or greywater recovery. It is
also very common for capital items that are considered non-critical,
such as computerised controls, to be sacrificed on grounds of
cost, when other advanced technologies in the building depend
upon them. Hence procurement on the lowest price presents a major
barrier to the government's ambitions for new buildings to become
carbon-neutral.
6. Despite the efforts in the 1990s by Sir
Michael Latham and Sir John Egan to eradicate the retentions and
pay-when-paid, these practices are still rife in the UK building
services industry. Such financial malpractice is damaging. It
creates instability in the sector by compromising performance,
growth, efficiency and employment.
7. The 2006 KPI data reveal that 82% of
clients had assigned retentions. In 2005, only 7% of building
services contractors reported satisfaction scores of eight or
more with respect to retentions. 37% of building services contractors
awarded a score of just one out of 10the worst possible
score for satisfaction with timely release of retention monies.
Note that retention monies are very difficult to collect. Clients
very rarely pay retention money voluntarily. It has to be continually
chased, which wastes time and money and diverts effort. It also
contributes to adversarial relationships.
8. BSRIA believes that the practice
of assigning retentions is unfair and a financial burden that
harms the industry and frustrates progress. Constructing Excellence
and Accelerating Change challenged the industry to get closer
to construction clients, to benchmark performance, and to raise
standards. BSRIA believes that clients must improve payment terms
to consequently improve the performance of the UK construction
industry. If clients are unwilling to do this voluntarily, then
the government should consider additional legislation and punitive
measures for non-compliance.
2. Construction sector performancesite
productivity
9. The issue of site productivity was the
subject of centrally-funded speculative research first commissioned
in the early 1990's through a programme then managed by the Department
of the Environment. The establishment of baseline data and more
importantly a pool of appropriate expertise has been the basis
of the more active interest in this subject in the latter decade.
10. BSRIA estimates that 20% of the average
working day on a UK building site is lost solely due workforce
organisation issues. This is a £6 billion per year problem
for the UK construction industry. BSRIA research has shown that
modern methods of construction can produce build rates that are
more than 10 times quicker than traditional techniques. Constructing
Excellence data also shows that three out of 10 projects have
unsatisfactory quality standards at handover.
11. The government needs to do more
to support integrated logistics initiatives that will reduce the
number of vehicle movements to and from construction projects,
and help improve the certainty of material delivery and distribution
on site.
12. Data from the Health and Safety Executive
shows that health and safety performance in the construction industry
is not improving. After a number of years of improvement, the
accident statistics for construction are now getting worse. Provisional
figures announced in April 2007 show fatalities for 2006-07 at
78, up from 59 in 2005-06.
13. The government should use existing
independent research on construction project performance to challenge
project costs, project programmes, safety and quality in public
sector supply chains. The government should then use the independent
organisations behind this research to work with its construction
supply chain to help apply key recommendations, study project
performance and help to improve industry practices.
14. The construction industry has an ageing
workforce. Many workers are leaving the industry, while an inadequate
quantity of young people with the right skills is entering. This
applies to professional personnel as well as site workers.
15. BSRIA believes that the government
should support initiatives to integrate good quality non-UK workers
into the industry. This will involve selecting people with the
right skills, helping them clearly understand the safety, quality
and technical standards required on UK projects, supporting their
development of the skills outlined above, and assisting them with
English language development. The withdrawal of funding of English
courses for non-English speaking workers must be reversed, as
this is a vital mechanism for improving the productivity of a
UK construction industry increasingly dependent on migrant labour.
16. Government should instigate an R&D
programme to fully identify the scope for improvements in site
productivity, focusing on the nature of delays measuring the performance
of the UK construction industry independently and properly, covering:
safety, quality, productivity and environmental actions.
17. Conventional thinking requires that
desired capacity is met though the creation of additional labour
resources through training. However, additional capacity can be
released for productive work simply by removing the present inefficiencies
of current workingeven without the added benefits from
offsite manufacture. To do this however, requires a re-orientation
of resources from conventional trade skills support to a more
focused development of higher-level skills. This is outside the
target zones of Sector Skills.
18. Government needs to develop integration
skills to cross the traditional (institutional) boundaries of
architecture, mechanical and structural design and contracting.
It is the elimination of waste at these interfaces that will release
time and resources in construction activities. This will challenge
current models of higher education courses, which are usually
accredited by the institutions themselves.
3. Encouraging sustainability
19. BSRIA believes that the design and construction
industry is committed to improving the environmental performance
of new and refurbished buildings. However, more needs to be done
to ensure that measures to improve sustainability are delivering
the expected benefits. In particular, BSRIA believes that government
policy has focused too much on technology, and not enough on ensuring
that buildings are designed to easy to operate, manage and maintain
after handover, with systems that can default to off, rather than
default to on.
20. BSRIA is concerned that there is a widespread
failure to meet targets for sustainable construction and refurbishment.
In many cases, claims of low energy, sustainable performanceparticularly
through the application of renewables technologiesare not
being borne out in practice. Such technology is leading to difficulties
in management and maintenance, particularly where there is insufficient
expertise in the end-user organisation to manage the technology.
BSRIA believes that complicated engineering solutions should be
a choice of last resort. Much more should be achieved through
passive design, such as increased insulation, daylighting, and
earth-coupled ventilation, before designers reach for innovative,
risky and complex technologies.
21. Hence BSRIA believes that the renewable
energy obligations, required and enforced by local authorities,
should be re-defined and made more flexible. Government policy
should not force building designers to specify renewables in contexts
where they are not appropriate, and particularly not in cases
where the budget could be more effectively spent on simpler, more
robust (and preferably passive) carbon-dioxide reduction measures
that will have a greater chance of success.
22. BSRIA strongly supports the findings
in the recent NAO report Building for the Future: Sustainable
Construction and Refurbishment on the Government Estate, specifically
those comments relating to the practice of relying on BREEAM ratings
as a proxy for actual improvements in a building's environmental
performance. BSRIA also agrees that government departments should
conduct post-occupancy evaluations to assess whether completed
construction and refurbishment projects have delivered the specified
level of performance.
23. Given that very few public domain, independent
and detailed post-occupancy studies of buildings have been carried
out since 2001, BSRIA is concerned that the construction design
community is still failing to close the loop between aspiration
and reality. The majority of post-occupation studies regularly
reveal energy consumption (and thereby carbon dioxide emissions)
in excess of the design target. Occupant satisfaction with thermal
comfort, lighting, indoor air quality, noise, and health are also
often lower than the designers anticipate. A recent DFES investigation
into the performance of recent ostensibly sustainable schools
shows that energy use in new schools is rising despite attempts
to reduce it.
24. In some cases, POE studies reveal that
some new buildings are performing much better than the typical
building stock. However, the reasons for this improved performance
needs to be highlighted and communicated to the construction community
and its clients to enable good practice to be replicated.
25. BSRIA therefore believes that government
should do more to support the use of design assessment and feedback
tools. The last proper research into building performance (that
strongly influenced the development of airtightness regulations
in the UK, and popularised post-occupancy evaluation and feedback)
was the DTI-funded PROBE studies (Post-occupancy Review Of Buildings
and their Engineering) carried out in the late 1990s. This research
work urgently requires updating. Much post-occupancy is not in
the public domain, and where it is, it is often not independently
verified, does not use benchmarked methods of assessment, and
is of varying quality.
26. As a matter of urgency, BSRIA believes
that the government should commission a new investigation into
the in-use performance of a range of building types using the
same robust methods of energy assessment and occupant satisfaction
surveys as applied in the original PROBE studies.
27. BSRIA also believes that far more should
be done to ensure that buildings are subject to proper commissioning
and fine-tuning in the early stages of occupation. It is a chronic
shortcoming in UK construction that clients inherit poorly commissioned
buildings. These buildings are often handed over to their users
in a perfunctory manner, with the minimum of familiarisation training
and professional aftercare. Rarely is enough time given to fine-tuning
the building for the occupiers' needs. Education in the use of
complex systems such as lighting controls and building energy
management systems is also lacking.
28. BSRIA strongly supports moves by various
industry bodies, such as the UK Green Building Council and the
Usable Buildings Trust, for at least 1% of the contract value
to be set aside for a "soft landings" approach to handover.
This should include post-occupancy analysis, fine-tuning and energy
labelling during the first two years of occupation.
29. A Soft Landings process should set out
the expectations for a project in a way that can be checked and
verified afterwards. Being explicit about the expectations also
enables a building's design to be reality-checked as the design
progresses. Changes can be reflected in a project's targets in
a way that is visible to all. Soft Landings should also include
a plan for the occupant migration process from an existing building
to a new building in a way that occupiers understand what they
are going to get, for example in terms of comfort conditions and
controls interfaces. The handover and fine-tuning period should
then be followed up by a period of professional aftercare by the
designers for at least the first year. This should include energy
assessments and occupant surveys to check that assumptions are
being followed achieved in reality.
30. BSRIA believes that Government should
take the lead and introduce a Soft Landings policy for all public
sector procurement, to the extent that it has championed the environmental
assessment method, BREEAM. BSRIA also believes that government
should set aside research funding to create a robust suite of
tools and procedures to enable this to happen. This would lend
strong support to forthcoming legislation on energy certification
for public sector buildings. This should also become mandatory
in PFI and PPP procedures. (Note that this will require an improved
service from the energy utilities as discussed in paragraphs 33
and 34).
31. BSRIA believes that government should
be doing more to place an obligation on energy suppliers to deliver
accurate energy consumption data. The onus is on the consumer
to force the utility to deliver accurate energy readings, rather
than on the utility. When an actual reading reveals overpayment,
the utility automatically issues a credit note rather than refunding
the consumer, enabling the utility to earn interest on the overpayment
at the expense of the consumer.
32. The practice of estimated readings rewards
over-billing and hampers attempts at managing energy efficiency.
For example, the energy savings of using compact fluorescent lamps
rather than traditional light bulbs can be swamped by variations
in the estimated reading. Consumers will not know whether they
are benefiting or not. This makes budgeting difficult, and cost-benefit
analysis highly inaccurate.
33. There is a sound argument for requiring
improved information attached to utilities billing that allows
users to evaluate their own energy and consumption in relation
to wider benchmarks. This is analogous to the requirements imposed
on credit card companies to display interest rates and charges
in a standard form. Historical normalised trending and use of
comparative benchmarks could greatly assist in this process.
34. As part of the above process there should
be pressure for utilities to adopt technologies permitting actual
meter readings as opposed to the current practice of relying on
estimated readings. Smart metering should become the norm for
new build and meter replacement.
4. Construction research and development
(R&D)
35. Construction R&D is frequently considered
as being disconnected from the conventional description of capacity
in the construction process. In reality, the presence of a vibrant,
sustained and well-managed long-term R&D base is a principal
means of developing high-level skills needed to meet emerging
markets. It encourages transfer of skills from other industries,
and provides a steady stream of well-rounded and engineering thinking
and process skills into industry. It also up-skills staff in private
companies through collaborative projects.
36. There are abundant examples of this
in practice. In the early 1980's the post of Energy Manager emerged
from the availability of skills from the public utilities and
Department of Energy-funded R&D that preceded the energy crisis
in the late 1970's. Latterly, the inclusion of airtightness in
Part L of the Building Regulations has been possible on a large
scale due to R&D activity that began in the early 1970s. Without
research-derived skills, it is unlikely that capacity would have
existed to meet the short timescales demanded by legislators.
37. BSRIA would encourage the inquiry to
reconsider the findings of the report undertaken by Sir John Fairclough:
Rethinking Construction Innovation & Research, commissioned
by DTI and published in February 2002. Although much of the R&D
capacity analysis in Annex C is now significantly overstated (due
to the withdrawal of sector-based funding schemes), the main conclusions
and supporting arguments remain sound and achievable. Acting upon
them would also add substantially to both the efficiency and sustainability
of the supply side of construction.
38. Unlike much R&D that supports the
development of new technologies and products, R&D in the construction
sector frequently supports open processes that are used within
changing project teams. This R&D therefore has little opportunity
to develop intellectual property that can be used to generate
revenue to support further R&D.
39. Historically, much of this effort was
carried out within former nationalised industries (for example,
CEGB, British Gas,) as well as the central government procurement
agencies such as NHS Estates, Property Services Agencies and the
former government laboratories such as BRE and TRL. These latter
agencies were particularly important in providing evidence-based
research underpinning legislation.
40. All these mechanisms have now been dismantled
in favour of reliance on the private sector funding R&D against
additional grant aid through the DTI innovation products. New
investment in technology-based R&D is now almost exclusively
carried out in university research departments. However, this
does not benefit the open protocol knowledge, nor does it support
the standards-making activities referred to earlier.
41. Welcome though the new DTI innovation
funding programmes are, they may not be ideally matched to the
new sustainability challenges that face those that supply goods
and services though the construction industry's supply chain.
42. BSRIA understands that government wishes
to use the necessarily limited innovation funding to create new
products and services that can increase productivity and national
competitiveness. To this end BSRIA applauds the reduction in the
number and complexity of support schemes.
43. Unlike much of UK industry (though not
uniquely), the construction sector has no significant market leaders
able to create a dominant pull on reforming technologies or processes.
The largest company in construction (Balfour Beatty) has less
than a 3.5% market share. It is also very much a project-driven
industry rather than a serial manufacturer.
44. The current DTI support products have,
at their root, the premise that a single company can take direct
benefit from IPR exploitation (and development) from a partner.
It has difficulty in recognising the benefits that can flow from
advances that create advantage for a large number of players,
none of which could, or should, be exploited exclusively for individual
gain. The development of standards on collaborative working is
an example.
45. BSRIA recognises that there are many
single-issue NGOs that address some of the areas covered above.
Carbon Trust, WRAP, EST and CABE for example, all derive funds
from the public purse in some form, but do not have a mandate
to drive the wider sustainability agenda as it affects construction.
46. Elsewhere in Europe it is the norm for
construction R&D supporting strategic initiatives to be seen
as a national asset both to ensure internal cost efficiencies
and to place national companies at a trading advantage, particularly
for exports. For example Denmark is now an acknowledged leader
in the supply of wind turbine technology where this has been derived
from a combination of R&D, home market transformation process
and legislative activity.
47. Within the European context, the UK
National Platform has been established to represent UK interests.
It is unique in publishing a national strategic programme. However,
unlike most mainland European countries, the UK does not have
a national construction research programme through which large-scale
projects can be quickly formulated. It is a lack of extant national
projects (with their associated networks) that makes access to
the large scale EU funding possible. Based on the ECTP meeting
held in January this year, it was clear that the UK is poorly
prepared in comparison to others.
48. In order to make the National Platform
have any value it is necessary for it to have some vehicle by
which it can turn good intent into action. We believe that a newly
formulated DTI funding product, designed from the outset to be
directed at truly collaborative demonstration and deployment projects,
would both provide the means to satisfy this need for construction
as well as other sectors of industry.
49. The levels of funding required to have
a profound effect are not large in comparison to sums expended
overall, and indeed could quite properly be derived from some
form of top-slicing from existing programmes such as those mentioned
earlier. Since much of the revenue is already derived from construction-based
work (for example. from landfill tax, which takes approximately
half its funds from construction waste), this would go some way
to restoring equity of application.
May 2007
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