Select Committee on Business and Enterprise Minutes of Evidence


Examination of Witnesses (Questions 380-399)

NSCC, SECG

10 DECEMBER 2007

  Q380  Mr Hoyle: Okay, it is consensus; so another 10 years on, are you still going to say "consensus" or are you going to actually say, "Well, to be honest with you, we believe it is ... "?

  Mr Hursthouse: The answer to that—no, no, another couple of weeks we will have it cracked, and then on the statute book!

  Q381  Mr Hoyle: But if you do not?

  Mr Hursthouse: If we do not, we will—

  Q382  Mr Hoyle: Do you blame the lawyers?

  Mr Hursthouse: No, no. We often do blame the lawyers, and we will! Look, as far as this thing is concerned, as I say, it is absolutely crucial. There are people who do say: "Let us have something that is nearly right and move on." There is no value in that; it does have to be something that is going to work. I take the view that however many years it is we have been in this review, if you assume the review had a purpose—and I believe it did—then surely it has to be seen through to a proper conclusion? That conclusion has to be something that delivers what we are trying to achieve or what BERR is trying to achieve. I believe it can do; I believe there is a willingness there. In fact we have a meeting with BERR on Thursday for that very purpose.

  Mr Wren: Can I add to it? I probably will get drawn into blame now! The central issue is that clearly contractors have a strong lobby, and it relates to cash flow. Those that do not want the cash to flow or to muddy the waters in terms of when that cash will flow clearly have an interest in not making it flow. If we are honest with ourselves, then it is the specialist group, lobbying for fair payment against the contractors' group, that wants to keep the thing muddy—which is what it is now.

  Mr Hursthouse: Five Ministers in four years does not help either.

  Q383  Mr Hoyle: So the strong lobby group continues. You are still using those old peers, are you, to lobby for you?

  Mr Hursthouse: Yes, very good they are too! I am not so sure about the old!

  Mr Hoyle: He has just woken up—we are all right!

  Chairman: We are not allowed to—

  Mr Hoyle: Can I just move you on to—

  Chairman: I think "old" is a bit unfair.

  Mr Hoyle: That is why I said it, Chairman!

  Q384  Chairman: Can I be clear? You are blaming the industry not the Government largely for the failure to make progress in this area. That is the important—

  Mr Wren: No.

  Q385  Chairman: Corporately.

  Mr Wren: Corporately, yes. The industry has got lots to answer for in terms of the way that we are structured and the way that cash does not flow. There is an opportunity for Government to clarify through this process. In trying to get consensus I think we are going to lose it. That is, in my view, the problem.

  Q386  Mr Hoyle: In the case of NSCC, they note that clients in the public and private sectors have committed to only using contractors that hold CSCS (Construction Skills Certification Scheme) carded workforces, but that is not actually happening. Why is it that many of the clients and contractors are still not delivering the commitment on both sides to use the CSCS carded workers?

  Mr Wren: I would probably disagree with you. Our experience is that most of the specialists operate a 100% carded workforce, and I think it is the same for SEC Group. There has been a lot of time and investment in making sure that we do go there. I think the main contractors group has a very strong commitment of only using 100% carded workforce on their sites, and clearly in terms of card number uptake it is very good this year and increasing. I think the issue is not the commitment the industry has in getting the carded workforce; in my opinion it is enforcement. When you turn up on site with a card and have spent time and money in getting that card, you want to make sure that that card is checked for your work on that site. Sometimes I think that is not happening.

  Mr Hoyle: What worries me is that in some of the evidence that has been provided—and it goes on to say in specialist skills; it says that clients have committed to using contractors with CSCS carded workforces, but this is not yet happening in practice; and this is a concern for those companies that have invested in qualifying their workforces. So they are saying that SMEs have not been able to invest because they are not quite sure where the next job is and where the next contract is coming from, and it is a lot of money to make sure everybody is carded.

  Chairman: For a point of clarity, Mr Hoyle has just summarised your own evidence to us, quoting your words to you.

  Q387  Mr Hoyle: So if you do not like your words, you should not put them down.

  Mr Wren: Well, I understand that. I can only tell you from my own experience and that within the NSCC. The complaints that come back to NSCC are: "I have invested in getting my CSCS card, but I am working on a site where other trades have not got CSCS cards: why should I invest in this card?"

  Q388  Mr Hoyle: You just said to me that that is not the case; now you are saying that is the case, but it depends which part of the contracts and which side they are on.

  Mr Wren: Well, you have got to view this as to whether—

  Q389  Mr Hoyle: It either is or it is not the case.

  Mr Wren: Look, it is a big issue in trying to get the whole of this industry moving towards—and it will take time. All I can tell you at the moment is that in terms of uptake and in terms of commitment from major contractors and from clients, they are saying: "We want to see a fully carded, 100% CSCS workforce."

  Q390  Mr Hoyle: I understand that, and I am not trying to corner you a little bit. They are delivering on their commitment but they are not delivering on the number of people who are holding the card—is that fair to say?

  Mr Wren: From my own experience there is a delivery on the commitment, and from nowhere it has—

  Q391  Mr Hoyle: We wish to see it. That is the objective.

  Mr Wren: Absolutely, yes.

  Q392  Mr Hoyle: The problem is they cannot put the ball in the net because they have not got the ball!

  Mr Wren: Yes, and I think also there is a question of it being mandatory on sites, and it is a question of the client again. It is not all the client; the client is assuming that if he has employed a good contractor and a good set of contractors and specialists, they will all be CSCS. It is not perhaps the right analogy, but if you are not a Corgi registered engineer you cannot go working on gas—it is illegal.

  Q393  Mr Hoyle: It does not stop them.

  Mr Wren: I know, but can you ever? So they get prosecuted and—

  Chairman: We are running a bit short of time. I do not want to flog this to death but there is one point. Can you reflect on what your evidence said to us, and the particular thing at the NSCC here, but can you just clarify—

  Mr Hoyle: I would say, please, if you would clarify; but also, is there any help and support that is needed to make sure that everybody carries the card?

  Chairman: A supplementary note would be very helpful on those points.

  Q394  Miss Kirkbride: The SEC Group has suggested some core criteria for assessing the competency of construction firms. Can you outline what they would be?

  Mr Hursthouse: Certainly in terms of health and safety they have been incorporated into the CDM Regulations. I am not going to trawl through all of that or try to list them. The principle, where they are coming from, is that what currently happens is that there is a plethora of qualification schemes which qualify businesses to carry out work on various projects, whether they are Government schemes where you go through a pre-qualification process for a health sector project or a school sector project—just anywhere—just qualifying schemes all over the place. Some of them are sub-contracted to the private sector to gather this information together. Very often there are costs, often not insubstantial, in qualifying and getting accreditation—"unless you have this accreditation you cannot work on the project"—and if you go into another section you need that accreditation. The view is: "Just a minute, competence evidence on construction projects—there is an element of it which is just universal; if you cannot behave properly when it comes to health and safety, you should not be allowed on the site." That applies to everybody. The thinking is that there should be some arrangement where there are core competences and there are schemes where you can qualify and those schemes relate to each other. If I were to get into this scheme it has some sort of accreditation to it; then I would get into that scheme and that scheme and that scheme, and I would not have to qualify for half a dozen schemes. There are very good schemes being run by trade associations, which are undoubtedly very thorough and very effective, but again I can qualify for one here and one here and qualify for one there—so core competence for assessment would save an awful lot of trouble and be a level playing field in terms of what competence really means.

  Q395  Miss Kirkbride: Do you see at present any difference between the public sector and the private sector with regard to this plethora of competences?

  Mr Hursthouse: To be blunt, no. I have got one contractor telling me I have got to qualify for him; I have another one telling me I have to qualify for him. The answer is "no". As I said earlier, there are within the CDM Regulations some core competence criteria, which is a good place to start, and it is something that should be developed if there is work to be done.

  Q396  Miss Kirkbride: Because they are effective. So what is your view on the effectiveness of Constructionline, BERR's own database for construction firms?

  Mr Hursthouse: It is a self-certifying paper exercise, and it has not delivered.

  Mr Wren: If it does not have third-party accreditation, it is not worth it.

  Q397  Miss Kirkbride: It is a waste of time?

  Mr Hursthouse: You might be able to recover it, but as far as what it delivers now—probably, yes. That is perhaps overstating it, but it is not what we are looking for in the industry.

  Q398  Miss Kirkbride: If there is a particular issue that you would like us to raise with regard to the Olympic Delivery Authority when we see them in the New Year, your chance is now!

  Mr Wren: I would say all the things that we said before. Choose your supply chain, choose it early and choose it wisely. It is the specialist sector that is going to build the Olympics, let us be clear. We have much to offer. Get in early and there is value engineering and innovation to be done. If the ODA adopts a hands-off approach and stops at its tier 1, which is the major contractors, and relies on them to do what they are going to do, nothing will change. Projects will be let on price rather than best value. Risks will be sub-contracted down the line. It does not matter where you sub-contract a risk—if it happens it will be to the detriment of the Olympics, and the best thing to do is understand the risk and manage it. Make sure cash flows through the supply chain. If you do not do that, you will end up with the experience of a fairly major national stadium not too many miles from here, rather than the experience of the Emirates Stadium, which we shared, which we both worked on. That was good practice in terms of supply chain integration. The 2012 construction commitments which were developed for the Olympics—it is important that they do not just stop at the contractor; but that the contractor operates those construction commitments through the supply chain. We need to see evidence that that is happening currently.

  Q399  Miss Kirkbride: You drew the analogy with the Dome: is the Olympics going to be ready on time?

  Mr Wren: It will.

  Mr Hursthouse: It certainly cannot be late. This is absolutely true: before we were here, as you might imagine, we consulted and we were aware this might come up, and so Graham just told you what he told you, and I can tell you categorically that I have very little to add to that—in fact nothing to add to that: I would agree with him entirely. As he said, we both did work on the Emirates, and the question is: do you want an Emirates or do you want a Wembley? I know which one I prefer!

  Chairman: The question answered itself.



 
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