£30bn Government Mega Framework Winners:
A raft of big-name contractors have been awarded places on the latest £9bn Procure23 NHS construction framework and a separate £21bn central Government major projects framework. Local contractors include Farrans, McLaughlin & Harvey, Henry Brothers, and GRAHAM.
Update on R&D Tax Credits:
There are still many companies that are not claiming R&D Tax Credits. As a reminder, if your company is Limited, based in the UK, spending money on improving a product/service or overcoming challenges, then you should be claiming R&D tax relief. The benefit can be taken as cash or future tax relief. Updates which are relevant to construction companies are:
1. If you are working at achieving Passivhaus or a BREEAM environmental accreditation on a project, then part of the associated time can be claimed.
2. Cloud computing for the purposes of R&D is to be included as claimable costs from next year. This is an expansion of the original guidelines and is good news for companies.
3. Time spent against tendering should also be considered from an R&D perspective, activities such as value engineering, plans and designs for out of the ordinary temporary works and the outline of additional methods for reducing carbon footprint can all demonstrate an element of R&D.
More consultations and changes are likely to come towards Autumn.
Challenges in the Republic of Ireland:
There are many challenges in the Irish construction industry. Two examples include:
There is increasing pressure on RoI-based contractors because of inflation and the material price rises. I have been told of examples where first and second place bidders have declined tenders while third, fourth and even fifth placed bidders have been approached to see if they could stand over their price and take on a project. The Procurement Advisory Note (PAN 01/21) was introduced relatively quickly in Northern Ireland. Credit must go to those who initiated this as although there have been problems, overall, it has provided a mechanism to compensate contractors for the unforeseen price rises on public sector projects. Our RoI-based counterparts don’t have such a facility and are currently on site working on many projects whilst exposed to fixed price tenders they submitted months ago.
Labour rates for all trades have become extremely high in Dublin. This is inevitably attracting subcontractors from Northern Ireland, which is reducing the labour availability on local projects, thus disrupting local rates.
Construction Industry Dinners:
I had the pleasure of attending the very successful Construction Employers Federation (CEF) President’s dinner event at the Culloden Estate & Spa on 31st March. This was the first face-to-face event that many attendees had been at in over two years. Mark Spence and John Tracey spoke about the key challenges facing the construction industry including the removal of the red diesel rebate. It is good to see more events are planned. For example, the Chartered Institute of Building (CIOB) is hosting its annual dinner event in the Crowne Plaza Hotel in Belfast on the 20th May. Over 250 people are already booked to attend.
News:
Other news includes:
Digital: I see CITB NI is continuing to offer courses around digital marketing. There seems to be a continual demand for this. Nowadays you need to know your SEO performance, your Google Analytics status, and your LinkedIn post impressions. If you don’t, you could get left behind!
Refurbishment: I have noticed some substantial office refurbishment tenders have been postponed as companies are questioning how much office space they will need in the future due to the success of homeworking.
Heritage: The Department for Communities has introduced a range of support options available to owners and groups to repair, and regenerate historic buildings, historic monuments, and the wider historic environment. I see the Historic Environment Division has support available of up to £200,000 per project. There are many organisations and funders involved in the heritage sector. I think it is going to be a sector which will offer increasingly more opportunities to contractors experienced in conservation work.
Schools: On 21st March, The Education Minister announced £794m of major capital works projects. Any such announcement about new projects is ultimately welcome news, but it is unclear exactly when the projects will move forward. Clarification is needed on this.
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