ACTIONS FOR RECOVERY An Essential Industry creating immediate solutions
INVESTMENT IN CONSTRUCTION ACTIVITIES CREATES UNIQUE AND IMMEDIATE ECONOMIC, SOCIAL AND ENVIRONMENTAL BENEFITS ACROSS THE COMMUNITY.
ACTIONS FOR RECOVERY The Construction Industry Group of Northern Ireland (CIGNI) recognises and congratulates the Assembly and Executive for the priority that has been given to the economy, infrastructure investment and employment within the Construction Industry and its supply chain. MLAs and Ministers have recognised the unique social and economic benefits that result from investment in construction work, whether new capital projects or through employment intensive maintenance activities. However, there is much work to be done. Urgent action and delivery is required if we are to prevent continuing job losses, further company closures, loss of our skilled young people and trades people and increasing negative social consequences being felt by communities across Northern Ireland. In this document CIGNI wishes to communicate some of the consequences of the current approach to investment delivery in key sectors, to identify what actions our politicians can take to improve the situation and to recognise the benefits to our economy and community if those actions are taken. We look forward to working with the Assembly and the Executive to ensure a growing sustainable economy that shows Northern Ireland is open for business and one which gives confidence to our young people that they do have a future here to live, work, play and raise a family in the land of their birth. Construction Industry Group Actions For Recovery 1
HEALTH INFRASTRUCTURE Background and Achievements so far Since the turn of the century there has been significant investment in Northern Ireland s health infrastructure following decades of underinvestment. The Department of Health, Social Services and Public Safety (DHSSPSNI) has an excellent track record of delivering its major building projects and has some of the best structures in place to ensure the efficient and timely procurement of minor works. However as people are living longer and medical treatments continue to develop the pressures on the health estate remain intense. The Health Minister in to be commended for the innovative steps his Department has already taken to attract alternative finance to supplement the public investment in our hospitals and other care centres. The Department should continue to engage positively with the construction industry to provide visibility of spending profiles and work programmes, to agree effective procurement processes that deliver jobs on the ground efficiently and to find new ways of increasing funding for infrastructure investment. 2 Construction Industry Group Actions For Recovery
WATER INFRASTRUCTURE Background and Achievements so far We take the supply of clean water and the treatment of our dirty water for granted but the infrastructure that makes it all possible is a vast network in constant need of investment. In recent years NI Water has been successful in ensuring that Northern Ireland avoids multi million pound fines from Europe for water pollution. However annual investment in water infrastructure has reduced significantly over the last few years. Consequences of the current approach to delivering investment in water and sewage infrastructure Risk to the water supply. Due to the age of the network there is significant risk of a repeat of the widespread loss of water supply as occurred during the big freeze of 2010. Costly leaks. There is still a considerable amount of water which is wasted through leaks in the network. Leaks cost. Pollution. We have pollution incidents / overflow discharges into our rivers and the sea due to the under capacity of treatment facilities. There is also an increased threat of multi million pound EU fines for pollution. Actions required by the NI Executive and Assembly to help address these problems Increase investment in short term. Increase the levels of investment in our water and sewage infrastructure over the next two years by reallocating funding to NI Water from other public bodies that have surrendered funds in- year and by re-allocating a proportion of the additional capital funding that the Executive received as a result of the Barnett consequentials from the autumn statement 2012 and Budget 2013. Reduce Bureaucracy. Increase the proportion of NI Waters funding that is spent on maintaining the network by reducing bureaucracy through reform of NI Water s status by the end of 2014. Currently NI Water has to comply with two regulatory regimes as it is neither a private organisation nor a Government Department. Introduce Water Charges. Increase investment in our water infrastructure in the long term through the introduction of water charges after the next election. Positive outcomes should these actions be taken Security of supply. The risk of disruption to the supply of fresh clean water will be reduced. Savings. The volume of clean water wasted through leaks will reduce, saving tax payers money. Better Environment. Pollution of our natural environment will be reduced for the benefit of all and Northern Ireland will continue to avoid paying multi-million EU fines for pollution. Construction Industry Group Actions For Recovery 3
EDUCATION INFRASTRUCTURE Background and Achievements so far Education infrastructure in Northern Ireland is going through a period of significant change. Many schools are closing down and many school buildings are in need of urgent renewal or replacement. The Executive has committed to improving community relations through the creation of shared education campuses. The commitment to the Lisanelly campus by the Executive is a positive step in this direction. Consequences of the current approach to delivering investment in education infrastructure Underachievement. Pupils unable to reach their full potential due to inadequate facilities. Uncomfortable learning environment. Many classes still being held in portable accommodation. Money Wasted. Considerable sums of money wasted on heating thermally inefficient schools. Delay after Delay. Constant and unreasonable delays in getting new school building projects to site. Actions required by the NI Executive and Assembly to help address these problems Make ESA happen. Ensure that the Educational and Skills Authority (ESA) is operational by the end of March 2014 to bring strategic overview to the needs of the education estate. Hold to account. Introduce regular and detailed public monitoring of the timeliness of delivery of the new school building programme by the Assembly s Committee for Education. Forward plan. By the end of 2013, identify the education projects that will benefit from a share of the additional 100 million in capital borrowing powers granted to the Executive for 2014/15 and 2015/16 under the Building a Prosperous and United Community pact and a plan to address the 400m backlog in schools maintenance in the medium term. This plan should identify the costs, the source of funding and the timetable for its delivery. Positive outcomes should these actions be taken Improved educational experience. Fewer school children will be educated in unfit facilities and more children will be given a better chance of achieving their full potential. Quicker delivery. New schools will be delivered more quickly. Delivery of a shared Education. Community relations will be improved through the timely delivery of shared education projects. 4 Construction Industry Group Actions For Recovery
TRANSPORT INFRASTRUCTURE Background and Achievements so far Adequate transport is essential for economic growth. It enables access to work and business, education, health services and social interaction, all key factors in our well-being. CIGNI welcomes the recent significant investment in our Key Transport Corridors but more must be delivered if we are to avoid the consequences of underinvestment. Consequences of the current approach to delivering investment in transport infrastructure Increasing levels of pollution in towns. Failure to address specific congestion points on key strategic routes. Decreasing performance of NI s largest asset its road network. NI a less attractive place to invest. Actions required by the NI Executive and Assembly to help address these problems Prioritise construction of bypasses around a number of our major towns. Five main priorities York Street, Interchange, A6 schemes, A5, Sprucefield bypass. We wish to see these delivered faster than currently planned. The delivery of these schemes will significantly enhance the connectivity, and shorten the duration of travel, between Belfast and Londonderry (and, consequently, Dublin) and can be shown therefore to have clear economic worth. Early completion of Integrated Transport Hub at Great Victoria Street and delivery of Belfast Rapid Transit scheme. Introduce 3 year budget for roads maintenance to make spending more predictable and better work planning. Positive outcomes should these actions be taken Reduction in road deaths through improved safety. Improved air quality as a result of reduced traffic congestion in our towns. Increased inward economic investment as road infrastructure improves. Decreased journey times. Construction Industry Group Actions For Recovery 5
HOUSING INFRASTRUCTURE Background and Achievements so far The Regional Development Strategy 2035 indicates a need for 11,000 new housing units in Northern Ireland per year. However there are only around 7,000 units a year being built. This is a huge shortfall which is growing annually. The Executive should be praised for its delivery in meeting social housing new build targets, the investment in the Co-ownership scheme and its review of the NI Housing Executive. However there are major issues facing the housing sector such as lack of mortgage finance for purchasers, lack of development finance, planning, regulation and onerous procurement which need to be addressed. Consequences of the current approach to delivering investment in Housing A shortfall of 4,000 housing units built annually. Increased waiting lists and homelessness in the NI- there are currently 37,000 applicants registered on the social housing waiting list and 9,021 currently accepted by the NI Housing Executive as statutorily homeless in the NI. Poor quality of the existing Housing stock contributes to around 300,000 households in Northern Ireland living in fuel poverty. Even though funding for the building and maintenance of social housing has reduced there are still underspends. Actions required by the NI Executive and Assembly to help address these problems Make use of Financial Transactions Capital to support house builders unable to access development capital from the banks. Implement the Empty Homes Strategy and introduce a holistic Energy Efficiency Strategy across the entire housing stock by 2014. Elements should include grant funding, a loans scheme, and rate relief incentives. Produce timely and accurate housing market statistics which are directly comparable with GB data. Set specific housing targets for each council area when transfer of planning occurs so there can be accountability. Positive outcomes should these actions be taken Create an adequate supply of homes for NI residents. Reduce housing waiting list and homelessness in the NI. Reduction in fuel poverty and illness related to poor living conditions. Create an boost in employment and sustaining skills across a number of business sectors. 6 Construction Industry Group Actions For Recovery
ENERGY INFRASTRUCTURE Background and Achievements so far The Executive s target of 40% of electricity demand being provided from renewable sources by 2020 will require significant infrastructure investment in the future both because the current grid is aging and because a greater investment in wind farms is likely to require reinforcement of the infrastructure and of distribution lines in particular. The recent Utility Regulator report confirms that Large Energy Users IN Northern Ireland, including construction material suppliers, are paying some of the highest electricity prices in Europe. Compared to our two nearest markets (in Great Britain and Ireland) prices are typically 20-25% higher in Northern Ireland. The cost pressures on business in the current economic climate are unprecedented. Consequences of the current approach to delivering investment in energy infrastructure Not achieving the Executive s target of 40% of electricity demand being provided from renewable sources by 2020. Maintaining high energy prices. Increasing already high levels of fuel poverty. Potential energy shortages and introduction of power rationing. Actions required by the NI Executive to help address these problems There must be strong cross-party political support for major infrastructure projects which will benefit all consumers an explicit statement of support and timetable for the second north-south interconnector should be issued by the Executive by the end of 2013. Prioritise construction of the North South Interconnector and deliver it by the end of 2015. Restoration of the Moyle interconnector to full capacity by the end of 2015. The extension of the gas network to the west needs to be pursued with urgency with a deadline of completion by the end of 2015. Positive outcomes should these actions be taken Lower energy prices thus reducing levels of fuel poverty. Improved competitiveness of local business thus sustaining and creating jobs. Lower cost base for companies thus attracting more inward investment and jobs. Long term energy security. Construction Industry Group Actions For Recovery 7
CONCLUSION In every country the Construction Industry is a key driver for economic development and this equally applies to Northern Ireland. As has been outlined, Northern Ireland needs an unprecedented amount of investment not only to develop both the physical and human infrastructure, but to enable us to compete in the global marketplace. As our message indicates there are significant benefits to infrastructure prioritisation and delivery as a means to enhance Northern Ireland s competitiveness, connectivity and attractiveness as a region in which to live and raise a family, do business and invest. Infrastructure prioritisation and delivery must now be raised to the top of both the Executives and the Assembly s agendas. In doing so we will ensure that we create a world class Northern Ireland for our children and future generations. The recent CBI Infrastructure Report, which we in the Construction Industry Group NI fully support and endorse, sets out the strategic steps that need to be taken by Government to create a world class Northern Ireland. We require a plan to take us to that world class Northern Ireland and we in the Construction Industry are prepared and willing to play our part in developing and implementing that plan for the benefit of our society now and in the future. 8 Construction Industry Group Actions For Recovery
Construction Industry Group Engagement with Government NI Executive Construction Industry Forum NI Assembly All Party Construction Group Construction Industry Group NI Government Construction Clients Group Trade Unions Professional Council Contractors Specialist Engineering Contractors Suppliers
CIGNI Aims & Objectives The CIGNI was formed in 1998 with the aim of representing the construction industry in Northern Ireland. Its objectives include: Promoting the interests of the construction industry in Northern Ireland Promoting efficiency Developing, promoting and monitoring good practice within the industry Securing and improving the industry s workload Exerting influence on Government policy Creating awareness of both the industry and the quality of the built environment The Group is currently composed of four industry groupings: The Contractors Construction Employers Federation Federation of Master Builders The Suppliers The Professionals Council The Specialist Sub Contractors Quarry Products Association NI Hire Association Europe Wood NI Glass and Glazing Federation Royal Society of Ulster Architects Institution of Civil Engineers Association for Consultancy and Engineering A number of other professional bodies Confederation of Associations of Specialist Engineering Contractors (heating, electrical, plumbing, steel, piling) Since the re-introduction of devolution in 2007 CIGNI has grown in strength and influence to the point where the Northern Ireland Executive and Assembly Politicians of all shades of opinion consider the CIGNI to be the voice of the construction industry in the Province. The CIGNI are regularly asked to meet, provide briefings and consult with both the various Ministers and Assembly sub-committees. In partnership with the Assembly MLAs we have jointly established the Northern Ireland Assembly Working Group on Construction which meets three times a year to provide a forum for MLAs from all political parties to meet with representatives of the construction industry to discuss current issues relating to the industry. An Essential Industry creating immediate solutions