The Economy

Overview of webmeet

‘The Economy and the Covid 19 Pandemic’

We are pleased to be joined today by Noble Francis, Economics Director at the CPA and Professor of Construction Economics at The Bartlett, University College London.

Noble will largely be looking to cover how the year has started for construction, how it has been most recently and where it could be going over the course of this year. Clearly the potential evolution of COVID-19 (Coronavirus) and policy makers’ reaction to it will be key to this, as will the impacts on the wider UK Economy so I will delve into these areas as well.

The main areas of interest are, however, likely to be how all of these impact on construction more specifically; effects on demand, effects on different parts of the supply chain and impacts on different construction supply chain.

Noble will also talk about what a lockdown situation may mean for the construction industry.

Questions brought up in discussion

• We are clearly heading into a major recession. What shape do you think it will take? U? V?
• How can we limit the impact on our supply systems so that they are able to bounce back after the pandemic is over?
• There are significant differences in the responses of Main Contractors in relation to their sites. Some closing down. Others keeping sites open to help sustain their supply chains. Why do you think we are seeing the different strategies? Is it that some MCs have more confidence in their site management teams to enforce the guidlines coupled with a greater focus on the needs of their supply chain partners?
• Based on the worldwide pandemic do you believe it to be irresponsible of the major contractors to “insist” on continuing to work for economical reasons which if they do not have the correct measures in place could impact the health and wellbeing of many.
• How long do you think it will take from the restart date to getting back up to 100% productivity?
• Could we loose people from construction for ever as a result of this?
• In the past money has flowed to the public sector to build homes for rent and buy standing stock. Are you seeing this ‘bounce back’ as being too short to warrant such intervention? Paul
• Do you see that government stimulus after the outbreak subsides will increase to fund infrastructure projects or Local Authority housing development schemes or do you see that the private sector will be seen as the main vehicle to recovery in activity?
• Is not the Coronvirus exposing the significant weaknesses in construction’s traditional operating system and business models?
• I am a school governor and our main contractor has withdrawn, this now presents a legionella problem etc- bearing in mind we have to stay open to key worker children. What options do we have ?
• Do you think that the voices of opposition parties, Sadiq Khan and others as well as social media shaming will lead to a forced shutdown?
• Should Clients suspend all works? Should they show better leadership?
• There are already companies either asking for or just stating that payments will be delayed. It appears that the larger the company the more pro-active they are in pursuing this strategy. What do you think we be the consequences for the SME’s and self employed and what effect will it have on the sectors ability to recover ?
• What can we learn from the current crisis to improve the performance of the industry when the pandemic is over. To coin a phrase, never waste a crisis.
• Could we be about to see significant inflation as industry starts again after the shut down.
• Do you not think that the supply of traditional materials will be in huge demand and purchased/stored by those with spare capital in order to stockpile to ensure continuity of supply to pick up loss productivity during this down time?
• Main Contractors should not be insisting that their suppliers work on site. Surely they should be working collaboratively and creatively with their suppliers to look at mutually advantageous ways to keep sites going and sustain supply systems.
• Should Hinkley be kept open to keep the economy going locally or should it be closed due to the virus ? whats your opinion
• Could MMC/Offsite finally gain some traction in terms of contributing to a speedier recovery?
• How do you feel the credit insurance industry will respond?
• What legal position would a main contractor hold with the client in relation to contract financial penalties for late deliveries caused due to the drop of productivity ultimately impacting the delivery programme.
• Doesn’t the crisis show that the UK government doesn’t understand construction? What can CESW and other representative groups do to help government better understand the industry?
• Deja vue all over again. How many times have we said we need to change?
• Will the effective short term shut down of the residential property market have a negative pressure on property prices? Do you see this recovering quickly afterwards and what impact do you see this having on housing delivery such as scheme viability within the private sector?
• Should not Main Contractots be having grown up sensible conversations with their clients as well as with suppliers before reaching for the contracts and lawyers?
• The support from the Government for employed, and now self-employed workers, is obviously welcome but it strikes me that it is impossible to know how many workers will need to access this support. Do you have any feel for how many workers (employed and self-employed) within the construction sector may need this support or what assumptions the Government has made when calculating the cost of this for the wider economy?
• Do you think the Help to Buy scheme will be extended beyond the currently notified end date to support recovery?