The Rt Hon Elizabeth Truss MP Brian Berry Stephen Phipson CBE - ACR
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
2020
INFRASTRUCTURE & DEVELOPMENT
FOREWORDS
The Rt Hon Elizabeth Truss MP
Brian Berry
Stephen Phipson CBE
G E N E R A L R E P R E S E N TAT I V E S
Eggleston Steel David Lock Associates
Quattro Plant DJE Construction
Creator Scaffold Designs & Temporary Wingnut
Works Consultants acr
F E AT U R E S
Commentary from Andrew Neil
The Parliamentary Review is wholly owned by Westminster Publications Ltd. (Company No. 08154359).
It is proudly independent of parliament and government. It is 100% funded by the representatives who write for it.
©2020 WESTMINSTE R PUB LI CATI O N S www.theparliamentaryreview.co.uk
Foreword
The Rt Hon
Elizabeth Truss MP
Secretary of State for International
Trade, President of the Board of Trade
and Minister for Women and Equalities
Even by the standards of the day – 2019 was one of the It is this excitement, optimism and ambition which I believe
most exciting and unpredictable years in British politics. will come to define this government.
The election we’ve just seen marks a huge moment in For too long now, we have been told Britain isn’t big
our country’s history. This government is taking a decisive or important enough to survive outside the EU – that
new direction, embracing the opportunities of Brexit and we have to accept a deal that reflects our reduced
preparing our country to flourish outside the EU. circumstances. I say that’s rubbish. With the right policies
in place, we can be the most competitive, free-thinking,
As international trade secretary, I’ll be driving forward
prosperous nation on Earth exporting to the world and
work on the free trade agreements that are going to
leading in new developments like AI.
be a priority for the government. Free trade isn’t just an
abstract concept bandied around by technocrats. It is To do that, we’ll give the brilliant next generation of
crucial for a strong economy and for the ability of families entrepreneurs the tools they need to succeed. Since
to make ends meet. Free trade benefits people in every 2015, there has been a staggering 85 per cent rise in
part of our country, as British firms export to new markets the number of businesses set up by 18 to 24 year olds –
and people doing the weekly shop have access to a wider twice the level set up by the same age group in France
choice of goods at lower prices. and germany. We’ll help them flourish by championing
enterprise, cutting taxes and making regulation flexible
The essence of free trade is in the title – freedom. It’s
and responsive to their needs.
about giving people the power to exchange their goods
without heavy government taxation or interference. As we do that, we’ll level up and unite all parts of the UK
Commerce and free exchange are the engine room of with great transport links, fibre to every home and proper
prosperity and social mobility. I’m determined to tackle school funding, so everyone shares in our country’s success.
the forces who want to hold that back.
2019 was a year of brewing economic and political
One of my priorities is agreeing an exciting new free revolution. 2020 will be the year when a revitalised
trade deal with the US, building on the great relationship Conservative government turbocharges the economy,
between our two countries and the Prime Minister and US boosts prospects for people across the country, and
President. But I’ll also be talking to other partners including catapults Britain back to the forefront of the world stage.
“
new Zealand, Australia and fast-growing Asian markets.
And with the EU too, we want a friendly and constructive
relationship, as constitutional equals, and as friends
With the right policies in
and partners in facing the challenges that lie ahead – a
relationship based on a deep free trade agreement.
Our country produces some of the world’s most successful
place, we can be the most
competitive, free-thinking,
“
exports, and the opportunity to bring these to the rest of prosperous nation on Earth
the world should make us all excited about the future.
FOREWORD | 1
Foreword
Brian Berry
Chief Executive, Federation of Master
Builders
Quality has, quite rightly, been high on the agenda for However, it is still the case that anyone in the UK
both the construction industry and the government of can legally undertake construction work without any
late. While the industry has much to be proud of, its prior knowledge or skills. That is why we are calling
reputation unfortunately continues to be tarnished by for a mandatory licensing scheme to be introduced,
serious failures that should no longer be accepted. so that in order to obtain and renew a construction
license you would have demonstrate a certain level
This year marks the third anniversary of the tragedy of competency.
that was the grenfell fire. It is fair to say that this has
focused minds on the quality agenda, and the Hackitt The construction sector deal set out an ambitious vision
Review has given some clear direction for the future. for the industry, to make it the best in the world. A
I know that many in the industry have been working key part of this will be increasing competency and
hard to start to implement these recommendations so professionalism in the sector and we believe a licensing
something like this may never happen again. scheme could play a key part in achieving this.
The house building industry has been under the
spotlight recently, and over the past year, we have
seen the announcement of a new homes ombudsman
to ensure owners of new homes have a clear route to
redress when things go wrong.
We at the Federation of Master Builders believe that at
the heart of a high-quality building must be the ability
to ensure a minimum level of competence. The private
“
domestic sector has for too long been plagued by rogue
and incompetent builders.
This is one of the reasons why the FMB took the
Quality has, quite rightly,
decision in 2012 to only allow new members to join the been high on the agenda
FMB if they have been independently inspected by the
British Board of Agrément. A company failing to meet
our strict standards will not then be able to join.
for both the construction
industry and the
“
Indeed, last year, we were refusing up to 20 per cent of
company applications to join the FMB.
government of late
2 | FOREWORD
Foreword
Stephen Phipson CBE
Chief Executive, Make UK
Britain’s manufacturing sector has for centuries been a the four grand challenges which we as a society face.
proud contributor to the nation’s wealth, employment We all want to see the UK at the forefront of the industries
and future prosperity. of the future, ensuring that the UK takes advantage of
major global changes, improving people’s lives and the
To put this into context, manufacturing matters more than
country’s productivity and economic prosperity.
its ten per cent share of output which, notably, is still more
than financial services and construction. The sector employs That prosperity must be available and fairly shared
2.7 million people around the whole of the UK, delivers an throughout our nation ending the north-south divide. The
average earning of £32,467 and provides 45 per cent of all grand challenges are focused on the global trends which
UK exports totalling £275 billion. The sector also leads the will transform our future: artificial intelligence and data, an
way in R&D, contributing 69 per cent of the national total. ageing society, clean growth and the future of mobility.
Each of these is focusing on a specific problem, bringing
However, the challenge that faces us in the coming months
government, businesses and organisations across the
is a hard one. For many British manufacturing companies,
country together to make a real difference to people’s lives.
trade with the EU is the only trading environment they
have ever known. We must also remember the issue of skills; it is of crucial
importance to all Make UK members and manufacturers.
Manufacturing has been going through a renaissance
We are all focused on how we develop our future talent
in recent years. We are the ninth-largest manufacturing
pipeline from all of society by encouraging women to
nation in the world, but our latest figures from Q2 2019,
become engineers and creating opportunities for those
in a period of increasing uncertainty, show domestic and
from every social and ethnic background.
international orders continuing to weaken as the boost
from artificial stockpiling unwinds while export orders By developing role models from all sections of the
remain at their weakest levels since the referendum. community we ensure we create the very best makers,
creators and innovators of the future.
“
We continue to work closely with government to make
sure manufacturing retains what it needs to be able to
thrive – that is zero tariffs in trading with our European By developing role models from
partners, regulatory alignment and a sensible transition
period allowing businesses the time to adapt to any new all sections of the community
trading environment.
To aid this innovative spirit, we continue to support
government’s work on the Industrial Strategy, which
we ensure we create the very
best makers, creators and
“
contains many positive individual measures and an innovators of the future
emphasis on the role of manufacturing in tackling
FOREWORD | 3
Andrew neil
British politics turned upside-down
It was a watershed election, up infrastructure, most of it designated relationship with the EU and until
there with the Attlee Labour for the Midlands and the north. that is clear business investment,
landslide of 1945 and the dawn of domestic and foreign, will not
These are not traditional Tory policies.
Thatcherism in 1979 as a general return in huge strength. But 2020
The Labour party likes to paint Boris
election that changes the course of should be a more appealing climate
Johnson and his government as
British politics. The trends had been for UK businesses, big and small.
hard-right Brexiteers. But when the
apparent for some time – and I’ve
dust settles on its leadership contest, government ministers speak
alluded to them in previous pieces
it may discover that Mr Johnson privately about a wall of money
for The Parliamentary Review – but
has parked his tanks not just on ready to come into Britain now that
the general election of December
the centre-ground of British politics the Brexit and Corbyn uncertainties
2019 saw them come to fruition.
but on the centre-left too, leaving have been resolved. But much of
For the first time ever, the the new Labour leader with room this will be hot money going into
Conservatives became the party not to be distinctive only on the further existing assets, whether property
just of the non-metropolitan working left. Broadly, Corbynism without or equities. It can leave as easily as
class but of the poorest voters, among Mr Corbyn, as one Labour shadow it enters. Real investment in new
whom it enjoyed a double-digit lead, minister said to me. machines, plant and capacity will
while Labour became the party of the grow only gradually until it sees the
For business, the election has removed shape of future UK-EU relations.
well-off and the well-educated. Thus
two major uncertainties: Brexit and
was British politics stood on its head.
a Corbyn government. The first is The talks will be rocky. The UK
This is of more than psephological happening, the second will not. So wants trade to remain friction-free.
significance. It has huge import for the there will be a modest economic The EU will say, fine, as long as
course of Conservative policy. Those bounce in 2020 as confidence returns. you remained aligned to EU rules
who think the Johnson government The UK economy ended 2019 limping and regulations. This, the Johnson
heralds a new Age of Thatcherism along at one per cent growth; Brexit government is making clear, is not
for the 21st century are mistaken. uncertainty had taken its toll. now acceptable. When I asked a senior
Those who pine for a return to limited even the IMF, congenitally gloomy minister how the government
government, tax cuts and free market about Brexit Britain, expects 2020 UK would deal with this friction-free/
economics will be disappointed. The growth to be closer to 1.5 per cent, continued alignment trade off, he
Tories need policies that will cement faster than the Eurozone and slower answered without hesitation – we
their new provincial voter-base with only than the US and Canada among would rather have more friction
a blue-collar conservatism. the g7 advanced economies. than remain aligned with Brussels.
So instead of tax cuts for the I say “modest” bounce because, of The government knows the private
affluent, we will have low-earners course, all the uncertainty has not sector remains wary, which is why
taken out of national insurance. gone away. The UK it will use its own balance sheet to
Instead of the free market, we now has to boost the economy in 2020 until
will have the highest national negotiate remaining uncertainties are resolved
minimum wage in Europe covering its future and business investment returns in
25 per cent of the labour force (that volume and with confidence.
would have given Mrs Thatcher This should be a good year for
the vapours!). Instead of cuts in business: major uncertainties
government spending there will be resolved, continued cheap money
more money for schools, hospitals as far as the eye can see, expansive
and the police. Instead of bearing fiscal policy, increased growth, a
down on the national debt and new appetite for investment. And if
the budget deficit, there will be the government screws it up, it will
a borrowing binge to finance have nobody to blame but itself.
£100 billion investment in
neil believes that the Conservatives will appeal to their
new voter base through “blue-collar conservatism”
4 | ANDREW NEIL
Review of the Year
Driving forward after Brexit?
Alan Tovey, industry editor, The Daily Telegraph
were factors but not the cause of the
shutdown scheduled for next year. The
plant is in decline, running at about
half capacity, and Honda is selling
insufficient cars in Europe to make its
continuance worthwhile. It also needs
money to invest in electric vehicles.
nissan’s decision not to build the
X-Trail 4x4 at its Sunderland plant was
another blow. A Japan–EU free trade
deal meant the company is able to
centralise production in its home nation
without penalty, making its British
foothold in Europe unnecessary. A
Both Honda and Jaguar
Land Rover announced global rationalisation of Ford’s portfolio
significant cutbacks last The vaunted renaissance of Britain’s saw it announce the cull of its Welsh
year, resulting in 8,000 automotive industry completely skidded engine plant. For both, Brexit concerns
job losses
off the road in 2019. made the decisions easier.
Jaguar Land Rover announced ten per Other manufacturers with UK
cent of its staff would be axed – some operations have similarly shuffled
4,500 jobs – as growing pressures production to prepare for Brexit.
finally became too much to bear. Vauxhall says it wants to build cars
at Port Ellesmere but won’t if it looks
Widening losses caused by a toxic uneconomic. BMW will make the
cocktail of diesel’s “demonisation” electric Mini in Oxford but only because
after the Volkswagen scandal, worries it has sunk so much into the plant,
over Brexit’s impact on JLR’s finely writing it off would be foolish.
tuned supply chain and weakening
consumer confidence combined with Sir Richard Dyson – who moved his
a wider global economic slowdown company’s headquarters to Singapore
and the brewing US–China trade war. in January – also abandoned plans for
It was too much for the country’s an electric car, much of which was
largest car maker to withstand in its being developed at his Wiltshire base.
current form. Britain leaving the EU was not to blame
though: the technological challenges
Such troubles were constant themes were simply too great. However,
across the sector throughout the year. there was some positive news for
In February, Honda revealed plans to the car sector. Fellow billionaire Sir
close its Swindon plant with the loss of Jim Ratcliffe said his new 4x4 is to be
3,500 jobs. Several times that number built in the UK, while Toyota started
will go in companies dependent on the production of a new model at its
Japanese giant. British plant.
Brexit worries including trade tariffs Meanwhile, the automotive industry
and hold-ups to imported components trade body calls ever louder for a
REVIEW OF THE YEAR | 5
THE PARLIAMENTARY REVIEW
Review of the Year
Brexit deal as “free and frictionless”
as the current set-up. Oddly for an
industry responsible for 14 per cent of
UK goods exports – the bulk of them
to Europe – and which supports one
million jobs, government seems deaf to
the demands.
Five years ago, Sajid Javid, who
was business secretary at the time,
proudly described UK automotive as
“the brightest shining star” in British
industry. Today, civil servants murmur
that the sector is “lost”.
Ownership of the country’s strategic The automotive sector
businesses came into focus last year. has repeatedly called
Protectionism was also on the agenda. for a Brexit deal which
In May, British Steel collapsed into
First came the £4.5 billion sale of maintains “free and
insolvency when private equity owner frictionless” trade
greybull was refused a £30 million satellite communications company
state bailout. Inmarsat to a private equity consortium
which included foreign buyers. The
Rather than liquidate the Scunthorpe- deal went through despite national
based business, a taxpayer-funded security concerns. But it set the stage
indemnity was used to bankroll British for heavier resistance in July when US
Steel while a buyer was sought. private equity firm Advent bid £4 billion
Turkey’s military pension fund was for aerospace and defence technology
lined up to take it on, but negotiations company Cobham.
collapsed amid political wrangling
in Ankara. The sale of Dorset-based Cobham,
famed as a pioneer of in-flight
China’s Jingye has since entered refuelling, was a political battleground.
exclusive talks with promises of £1.2 Critics said selling to a foreign owner
billion of investment in British Steel. would erode the country’s industrial
The deadline for a deal is early spring base and endanger UK secrets, despite
2020 but questions remain over the buyer being based in Britain’s
whether the UK – which produces closest ally.
just eight million tonnes of steel a
year – can remain a viable player. Supporters – including former Defence
globally, 1.6 billion tonnes of steel Secretary Sir Michael Fallon – pointed
is produced annually. Half of this is to Cobham booking just five per cent
from China, where often state-backed of sales from the Ministry of Defence.
mills face lower labour costs and lax US ownership, they said, would allow
environmental regulation compared to the company to win more lucrative US
their British rivals. contracts. Shareholders voted with their
wallets: 93 per cent backed the deal.
Faced with such foreign goliaths,
Britain must ask itself if it needs – Having consulted security chiefs,
and will therefore probably have to Andrea Leadsom, the then business
subsidise – an indigenous steel industry. secretary, allowed the transaction. She
And in the meantime, UK taxpayers required controls including Advent
continue to underwrite British Steel, notifying ministers of plans to sell
which is understood to be losing £1 Cobham, and guaranteeing supplies of
million per day. key equipment to the MoD.
6 | REVIEW OF THE YEAR
INFRASTRUCTURE & DEVELOPMENT
Boris Johnson, the prime minister, a regular flow of funds for new R&D,
defended the sale, saying it was equipment, processes and skills which
“important we have an open and deliver incremental improvements that
dynamic market economy”. Investment keep British industry competitive on the
bankers saw it as a green light: they global stage have lagged.
are now seeking other UK businesses
“British industry is great at finding
previously seen as too hot to
solutions to bloody difficult problems,”
handle that they can now market to
confided the chief executive of a top
overseas buyers.
British industrial business ahead of the
But the one theme which election. “The problem is we don’t
overshadowed all discussions last year know what the bloody problem is.”
was Brexit. Uncertainty, rather than the
Perhaps the biggest event for British
event itself, is the fear. There are too
industry in 2019 was the size of the
many unknowns to develop strategies
majority the electorate delivered for the
to tackle the fallout from this seismic
Conservative government. The certainty
event in British history.
that companies craved is coming –
As a result, companies have held back though it may not be in the form they
investment, hobbling industry. Without wished for.
British Steel
required £75 million in financial
support to prevent it going into
administration. The government
continues to fund the £1 million a day
losses, according to The guardian.
There has been a decline in sales since
2016, which The guardian attributes
to the ongoing Brexit process. The fall
in the value of the pound sterling since
the EU referendum in 2016 and the
growing trade war between China and
the United States exacerbated pre-
existing issues.
The company was put into liquidation
in late May, risking 5,000 jobs and
British Steel went into
liquidation in May, threatening a further 20,000 in the
putting 5,000 jobs at Following a loan of £100 million supply chain. British Steel employs
risk and threatening a 4,000 people in the UK, with 3,000
from the government to pay off an
further 20,000 in the
supply chain EU carbon bill, British Steel entered based at its site in Scunthorpe and
into talks to keep the company afloat another 800 located in Teesside
in May 2019. The firm, owned by and the north East. At this time, the
greybull Capital, revealed that it government’s Official Receiver took
required further funding amid “Brexit- control of the company.
related issues”.
Following British Steel entering into
British Steel was the second-largest administration, greg Clark, who
producer of steel in the UK and was business secretary at the time,
REVIEW OF THE YEAR | 7
THE PARLIAMENTARY REVIEW
Review of the Year
said “the government has worked A failure to agree upon the terms
tirelessly with British Steel, its owner of the takeover led to Ataer walking
and lenders to explore all potential away. After this, the Official Receiver
options to secure a solution for granted permission for other firms to
British Steel. bid on the company. They disclosed
that their first priority was to conclude
“We have shown our willingness
a sale as swiftly as possible.
to act, having already provided the
company with a £120 million bridging The company was to be bought by Jingye
facility to enable it to meet its in november 2019. The Chinese group
emissions trading compliance costs.” employs 23,500 people and is active in
the hospitality, chemical and property
The company was part of a rescue
sectors as well as having its own stakes
deal from Ataer Holding, a Turkish
in steelmaking. The sales agreement
investment group, who are owned by
was signed in early november.
the country’s military pension fund.
The group also owns almost 50 per The national Trade Union Steel Co-
cent of Erdemir, Turkey’s largest steel ordinating Committee have voiced
producer. A provisional agreement concerns that the acquisition would
was made in August for the takeover. lead to considerable job loss.
Heathrow expansion plans published
The long-running saga surrounding
the construction of a third runway at
Heathrow Airport was finally met with
some more cheerful news in 2019, with
the publication of its masterplan.
Plans for the major infrastructure
project would see the first phase of the
works complete by 2026, with a final
completion deadline of 2050.
The overall works will include diverting
rivers, moving roads and rerouting the
M25 tunnel under the new runway.
The first phase of works will include
the new runway, with the rest of the Under the proposals set
forward in the master
infrastructure works including new homes, plus 25 per cent for housing plan, rivers will need to
terminals and access to follow. be diverted and the M25
in the compulsory purchase zone as
tunnel will be redirected
Included in the plan is Heathrow well as some of the homes in the under the new runway
Airport’s proposed compensation surrounding areas.
scheme for the people who will have
The project has faced fierce opposition
their homes demolished to make way
over the years, with local residents
for the expansion. In total, 761 homes
and environmental groups arguing
are expected to be demolished, which
against the expansion. This included a
includes the entire village of Longford.
High Court challenge by five councils,
Compensation for the properties residents, environmental charities and
covers the full market value of the Sadiq Khan, the mayor of London.
8 | REVIEW OF THE YEARINFRASTRUCTURE & DEVELOPMENT
Local authority areas of Hillingdon, to the taxpayer and within our
Wandsworth, Richmond, Hammersmith environmental obligations.
& Fulham and Windsor & Maidenhead
“I now call on all public bodies not to
made up the council opposition.
waste any more taxpayers’ money or
greenpeace and Friends of the Earth
seek to further delay this vital project.”
were some of the environmental
groups involved. Opposing the ruling, greenpeace
UK Executive Director John Sauven
The campaigners said the runway would
said: “This verdict will not reduce the
essentially result in a “new airport” and
impact on local communities from
have a “severe” impact on Londoners.
increased noise and air pollution, nor
They believed that the government’s
will it resolve Heathrow Ltd’s financial
national Policy Statement, which sets out
difficulties or the economic weakness
its support for the project, did not fully
in their expansion plans.”
account for the impact on air quality,
climate change, noise and congestion. The ruling means the government will
not have to create a new nPS and put
Chris grayling, who was transport
it to another vote in parliament.
secretary at the time, said the
expansion was “vital”. He added: The final decision will be made by
“[Heathrow] will provide a massive grant Shapps, the transport secretary,
economic boost to businesses and in the autumn, as he deliberates
communities across the length and whether to grant the proposals a
breadth of Britain, all at no cost Development Consent Order.
UK manufacturing sector output valued
at £192 billion
Facts”, exports to the EU were double
the value of those to the USA. Make
UK noted the importance of the deal
between the EU and UK being one
which facilitates trade, as opposed to
creating barriers to it.
The United States topped the list of
countries the UK exported to, followed
by germany and the netherlands.
France and Ireland were next on the
list. The USA accounted for £118.2
billion pounds worth of trade, while
the top seven EU markets accounted
for £236.5 billion worth.
In terms of total trade,
the UK exported £118.2
Further broken down, this indicated
billion worth of goods Manufacturer’s organisation Make UK
to the US and £236.5 that the UK was the tenth-largest
valued the UK’s manufacturing sector
billion to the top seven exporter in the world and the seventh
markets in the EU at £192 billion – the ninth-largest in
largest for trade. With regard to pay,
the world.
income from manufacturing was higher
According to the annual report of than the service economy, at £33,592
“UK Manufacturing: 2019/20 The on average.
REVIEW OF THE YEAR | 9THE PARLIAMENTARY REVIEW
Review of the Year
Of the UK’s research and development, which Make UK attribute to the
manufacturing accounted for two continued growth of the aerospace
thirds of the total, and 15 per cent of industry. The second-fastest growing
the overall business investment. export is food and drink, which has
seen an increase of 5.4 per cent
According to the study, the transport
between 2008 and 2018.
sector accounts for over one quarter
of exports, while pharmaceuticals The report considers geography as a
and chemicals follow at almost 18 factor, with the north West responsible
per cent. The transport sector also for £28.5 billion worth of trade, while
demonstrated the greatest signs of London and the South East follow with
growth, increasing by 7.4 per cent, £28.1 billion worth.
Tory housing pledges
During this year’s election campaign,
the Conservative Party made a number
of pledges to boost the construction
and housing sectors.
In november, during a speech in
Manchester, Sajid Javid, the then
Chancellor of the Exchequer,
announced a pledge to spend £20
billion more every year on capital
infrastructure projects including roads,
rail and other infrastructure.
In order to finance this, Mr Javid
proposed shifting and amending
the government’s own fiscal rules.
This would involve increasing the
amount of annual economic output Boris Johnson pledged
the government could spend on to build one million
infrastructure to three per cent, higher majority government in 2020 we more homes over the
next five years
than its usual average of 1.8 per cent. can and will do even more to ensure
everyone can get on and realise their
Mr Javid justified this shift by arguing dream of owning a home.”
that low borrowing costs meant it
was a responsible time to invest. Mr Johnson stated that these new
Following on from this, he stated homes would be delivered by tackling
that if debt servicing costs did rise, inefficiencies in the planning sector
the government would reassess their and finding new ways to support
spending plans. home ownership.
In the same month, Boris Johnson Reaction from the industry was mixed,
announced Conservative plans to build however, with Polly neate, the chief
a million more homes over the next five executive of the housing charity
years. Announcing this new pledge, Shelter, criticising the million homes
Mr Johnson said: “The Conservatives as insufficient. She argued: “The
have always been the party of home commitment to only build 200,000
ownership, but under a Conservative a year when the government’s own
10 | REVIEW OF THE YEARINFRASTRUCTURE & DEVELOPMENT
target is in fact 300,000 shows that long-term, fixed-rate mortgages which
even the Conservatives don’t think require deposits of only five per cent.
they’d be able to achieve this goal. This would be supplemented by a
further pledge to offer 30 per cent
“The missing piece in their plan
discounts for local, first-time buyers.
is any investment in new social
house building – without this the
Finally, Mr Johnson announced the
housing emergency will continue to
introduction of “Lifetime Rental
get worse.”
Deposits.” This would allow individuals
Alongside this flagship commitment, to transfer their down payments from
Mr Johnson also announced new one property to the next, even before
initiatives to help renters buy their the deposit from the original property
homes including the introduction of was fully repaid.
Cobham takeover
a £500 million bailout following the
acquisition of Aeroflex.
Rules on foreign takeovers, particularly
those which impact national security,
have become increasingly stringent.
Professor at Warwick Business
School John Colley said the Cobham
takeover “will serve as a first test for
the government when we will find
out how protectionist they will be. At
present the new government is such an
unknown that it is almost impossible
to know how they will jump. However,
they certainly have the powers to
Defence supplier
Cobham was first stop the deal now as a matter of
founded in 1934, as On July 25, 2019, UK aerospace and defence security.”
Flight Refuelling Ltd, by
defence supplier Cobham agreed to be
Sir Alan Cobham In november 2019, the acquisition
bought by Advent, a US private equity
of Cobham was delayed following a
firm. The deal was valued at £4 billion
statement from Andrea Leadsom, the
and, according to The guardian,
business secretary, demanding more
indicated “the new government’s
time to give “further full and proper
tolerance of foreign takeovers”. The
consideration of the issues”. The
announcement saw shares in the
decision further prolonged the takeover
company rise by 35 per cent.
until after the general election on
Founded in 1934 by Sir Alan Cobham December 12.
as Flight Refuelling Ltd, the company
Mrs Leadsom continued: “the full
now employs 2,000 people in the UK,
legal process will continue to be
and around 10,000 across the world in
followed throughout the general
over 100 countries.
election period.” The decision was
The company’s turbulent history saw not given a deadline, which meant
it receive five profit warnings between it could continue for as long as was
2015 and 2017. Shareholders provided deemed reasonable.
REVIEW OF THE YEAR | 11THE PARLIAMENTARY REVIEW
Review of the Year
The prime minister had planned to Mrs Leadsom announced that the risks
accelerate the acquisition of Cobham had been considered and mitigated
with the understanding that Advent “to an acceptable level” and that
strengthened security around sensitive the decision had been “meticulously
sites. This followed a three-week thought over”. She received advice on
examination as to the consequences the decision from both the defence
of such a decision. The decision also secretary and the deputy national
included the caveat that were Advent security adviser.
ever to sell Cobham, the government
Lady Cobham, the daughter-in-law
would have to be informed.
of the late Sir Alan Cobham, voiced
The government approved the deal her concern, stating: “in Cobham
late on December 20, a time which the we stand to lose yet another great
Cobham family suggested was chosen British defence manufacturer to
to “avoid scrutiny”. foreign ownership.”
Interserve goes into administration
One of Britain’s biggest contractors,
Interserve, fell into administration at
the start of 2019.
In March, the group’s largest
shareholder, US hedge fund
Coltrane, led a rebellion against
financial rescue plans drawn up by
Interserve’s lenders.
The management was trying to push
through a debt-for-equity swap in
an effort to reduce its £650-million
debt pile, in a move that would have
enabled shareholders to retain five per
cent of the company’s equity.
However, Coltrane, which owned
27 per cent of the company, voted
against the deal and threatened to
sue Interserve’s directors and advisors
for mismanaging the refinancing and The contracting giant
failing to consult shareholders. went into administration
The company insisted the pre-pack after Coltrane, the
company’s largest
The move meant that thousands agreement would enable Interserve
shareholder, voted
of small shareholders lost their to continue trading, while protecting, against a financial rescue
investment, with Interserve instead in the short-term, 45,000 jobs and package
being sold to hedge funds and banks avoiding a Carillion-style collapse.
via a pre-pack administration.
Interserve ran into trouble on a series
Hedge funds Emerald, Cerberus and of lossmaking contracts, including a
Angelo gordon along with lenders disastrous move into the energy-from-
including RBS have now taken control waste sector and slow payments on
of the company. projects in the Middle East.
12 | REVIEW OF THE YEARINFRASTRUCTURE & DEVELOPMENT
One particularly bad EfW job saw Viridor issued a notice of termination
Interserve face a £72 million claim from in november that year after Interserve
waste firm Viridor due to delays and failed to complete the job on time or
problems associated with the building on budget.
of its £155-million glasgow waste-to-
The claim by Viridor was to Interserve’s
energy plant.
construction division, which remained
Interserve was originally expected to solvent while its parent company went
complete the project in 2016, but into administration.
The automotive sector: JLR, Honda, Ford
and nissan
years’ time, at the expense of 3,500
jobs. The company had produced
160,000 Honda Civics from the plant
prior to this.
In the same month, nissan confirmed
intentions to build their new X-Trail
factory in Japan as opposed to in
their Sunderland plant, citing Brexit
complicating their ability to “plan for
the future”.
June saw Ford announce plans to close
plants in Europe, at the expense of
12,000 jobs. The company planned
to reduce the number of plants from
24 to 18 by the close of 2020. In the
UK, the job loss amounted to over
3,000 positions.
In December 2019
alone, Automotive news According to The guardian, in 17 of
Europe reported that In January 2019, Jaguar Land Rover the past 18 months, car production
output from the UK car confirmed plans to cut 4,500 jobs, the has fallen in the UK, with a decline of
industry decreased by 17
per cent majority of which would come from almost 15 per cent between January
its UK 40,000-strong workforce. The and november.
redundancies followed an additional
JLR made a profit of £90 million in
1,500 from the previous year. The
the three months prior to September
firm attributed a range of factors to
2019, while they made a profit of
the decline, including a sales slump
£385 million the year before. Chief
in China and uncertainty caused by
executive of JLR Ralf Speth said:
Brexit. At present, 80 per cent of cars
“We are taking decisive action to
made in the UK are exported, with
help deliver long-term growth, in
the EU the market for more than half
the face of multiple geopolitical
of these.
and regulatory disruptions as well
Late February saw Honda confirm plans as technology challenges facing the
to close their Swindon plant in two automotive industry.”
REVIEW OF THE YEAR | 13THE PARLIAMENTARY REVIEW
Review of the Year
Remembering Britain’s first professor of
manufacturing
Professor Lord Kumar Bhattacharyya,
Britain’s first professor of
manufacturing, passed away in March
2019, after a short illness. Professor
Lord Bhattacharyya founded WMg in
1980, a company that intended to help
businesses innovate and to work with
university researchers; he then went on
to play a key role in encouraging Tata
to invest in Britain’s manufacturing.
Born in June 1940, Professor Lord
Bhattacharyya studied mechanical
engineering at the Indian Institute
of Technology in Kharagpur. One
year after graduating, in 1961, he
moved to the UK, where he took up Professor Lord Kumar
Bhattacharyya was made
an apprenticeship at Lucas Industries. Regius Professor of
the UK, most notably in his work with
This was soon followed by a move the Manufacturing in 2016,
Tata. Through taking Mr Ratan Tata
University of Birmingham, where he becoming the first person
on a tour of the Midlands automotive to hold the position
read for both a master’s and PhD in
suppliers, he was able to persuade him
engineering production, the latter of
to invest in British manufacturing. This
which he received in 1970.
investment created partnerships in
His work saw him move to the University both training and research for Jaguar
of Birmingham, where he was awarded a Land Rover and WMg, in addition to
Lucas Fellowship. Following this, Professor overseeing the creation of the Tata
Lord Bhattacharyya moved to the Motors European Technical Centre on
University of Warwick in 1980, where he Warwick campus in 2005.
founded Warwick Manufacturing group.
greg Clark, the former business
Professor Lord Bhattacharyya’s work secretary, said “through the WMg –
impressed Mrs Thatcher’s industry Warwick Manufacturing group – ...
secretary, Sir Keith Joseph, whose and through his extraordinary energy
introduction to the prime minister was and tenacity Kumar encouraged many
met with the line “Kumar, we have just firms to locate and expand in Britain.
been in a Cabinet meeting discussing
“Hundreds of thousands of people in
your work”.
Britain owe their livelihoods to Kumar
For the following four decades, Bhattacharyya.”
Professor Lord Bhattacharyya’s opinion
As The Parliamentary Review goes to
on technology and manufacturing was
print, City AM have reported that the
sought from industry ministers and prime
UK manufacturing sector has reached a
ministers alike, irrespective of party. He
nine-month high. One would imagine
also provided advice for leaders across
that in spite of a tumultuous few years,
the world, including India and China.
Professor Lord Bhattacharyya would be
Professor Lord Bhattacharyya was also pleased to see British industry on the
a figurehead in internal investment in rise once again.
14 | REVIEW OF THE YEARINFRASTRUCTURE & DEVELOPMENT
Eggleston Steel
Site on Alfreton Road,
Derby
Managing Director Richard Hewitt
W
ith more than 200 years’ experience as a steel
stockholder, Derby-based Eggleston Steel supplies the
construction, fabrication, engineering and automotive
sectors. Managing Director Richard Hewitt tells The Parliamentary
Review that the company truly had to prove itself during the
recession in the 2000s. He explains that intelligent investment has
proven to be the most important part of the last two decades.
FACTS ABOUT
Eggleston Steel
In 2003, with 20 staff and a turnover of £1.7 million, we relocated to our sixth premises »» Managing Director:
with the sole aim of expansion. These new premises provided the opportunity Richard Hewitt
to operate more efficiently and hold higher stock levels following increased
»» Established in 1809
purchasing power. This provided enough additional storage for us to diversify and we
installed our first high-definition plasma machine in late 2007. This allowed us to cut »» Based in Derby
holes in steel plate up to 50mm thick, to any shape our customers required. »» Services: Steel stockholders
and related processing services
This new service was a game changer for the company as it provided an additional
»» No. of employees: 55
process that not all stockholders offered. We became a “one stop shop” for
new and existing customers and we saw the beginning of rapid growth for the »» Accredited to ISO 9001 and
company. Up to this point, like most steel stockholders, we only offered sawn and ISO 14001
guillotine processing services. »» www.egglestonsteel.co.uk
The impact of investment
When the recession hit the nation in 2008, it was the plasma machine growth that
delayed the impact on our sales for eight months and the redundancy of four staff.
Looking back now, this machine probably prevented us becoming a statistic of
the recession.
EGGLESTON STEEL | 15THE PARLIAMENTARY REVIEW
Highlighting best practice
The recession caused many customers In 2017, my daughter, having achieved
to reduce their workforce, which in her degree in business management,
turn resulted in greater expectations joined the team to specialise in human
from across their supply chain. We resources, health and safety and
therefore found ourselves looking at quality assurance. We are proud that
ways to provide additional services and this fifth generation has chosen to
add value to our products. A larger become involved.
plasma machine was acquired in 2011
In 1996, we obtained certification
and a CO2 laser followed shortly after.
“
to ISO 9001. This accreditation
This laser gave greater accuracy and
confirmed that our business and
Our customers shorter lead times, and thus provided
an edge over our competition.
quality management system met the
require us to We have a customer base of 1,000
internationally recognised standard.
Following the decision to reduce our
be reliable, companies and 700 active monthly environmental impact, we achieved
reactive and accounts, all within a 45-mile radius of
Derby. Our customers require us to be
the international standard ISO 14001
in 2016, which demonstrated our
flexible in
meeting their
“ reliable, reactive, flexible and to supply
orders that the larger stockholders
tend to avoid. We will supply orders
commitment to the environment. All
our waste is recycled, while 288 solar
panels and LED lighting throughout
needs from £100 to £100,000 as all orders
are equally important to us.
our buildings help reduce our
electricity consumption.
Our heritage Investing for the future
We are proud of our family heritage, In the 16 years we’ve been at our
with my wife, father, mother, brother current location, we have increased
and aunt all working as directors and to 55 staff with a turnover of over
involved with the decision-making. My £8 million. Recent years have seen a
son joined in 2014 and, as I did before significant reduction in the availability
him, began in the warehouse to obtain of skilled labour across all aspects of
an understanding of the products and our industrial sector as many subjects
services we sell, while completing an relating to steel and fabrication are
HND in business management. in decline in schools and colleges.
Over two centuries of
strength in steel
16 | EGGLESTON STEELINFRASTRUCTURE & DEVELOPMENT
Profile department, with
state-of-the-art steel
Our operations director, John Ready, offering options to drill, tap and processing machinery
has recently formed ties with a countersink holes prior to cutting any
local training centre, customers, a shape via plasma arc. Both companies
local councillor and an MP, with a are family run and our similar values
mission to introduce young people meant our partnerships started with a
to manufacturing as a vocation. As strong connection.
a nation, we have had a long history
With the current political turmoil,
in manufacturing high-quality goods,
Brexit is hard to avoid. As a company,
“
and every effort should be made to
75 per cent of our stock is UK sourced,
maintain this heritage.
Within our industry, we are a relatively
but the remainder is not produced
by UK mills and is therefore procured
To remain
small steel stockholder, so to remain from EU countries. With many competitive,
competitive we continually invest commercial connections to the EU, we
in technology and machinery. In naturally enquired as to their view on we continually
the last 18 months, we have sent
a management team to various
European countries to find our next
Brexit. The opinion was generally the
same: just get it done and move on.
All our EU partners wish to continue
trading with the UK and see no reason
invest in
technology
“
generation of processing equipment.
for continued uncertainty. Like many, and machinery
In 2019, we acquired a new we have been frustrated with what
flatbed fibre laser, guillotine and seems to be hidden political agendas
220-tonne, four-metre pressbrake, and a resistance to follow the will of
all with interactive LCD displays, from the people.
Belgium-based manufacturer LVD.
In November, we completed our As we move forward, we will continue
investment plan with a new machine to support our customers, regardless
from the Netherlands, purchased of political intervention, as we have for
from Voortman Steel Machinery. the last 210 years.
This machine will process plate while
EGGLESTON STEEL | 17THE PARLIAMENTARY REVIEW
Highlighting best practice
Quattro Plant
An engaged and highly trained workforce across
the UK helps keep Quattro Group on track
Managing Director John Murphy
Q
uattro Plant, part of the Quattro Group, is one of the
leading plant hire organisations in the UK. Managing
Director John Murphy tells The Parliamentary Review
that it supplies an unrivalled fleet of plant and equipment to
the rail, construction and transport markets. John explains that
the firm has a reputation for innovation, something which has
FACTS ABOUT come about in no small part thanks to its relationship with
Quattro Plant
Network Rail.
»» Managing Director:
John Murphy
»» Founded in 1989 We enjoy close relationships with core organisations within a variety of exciting
sectors. Working on the front line, our nationwide teams continually deliver a safe
»» Based across the UK, with a
and efficient network for passengers across the UK.
head office in London
»» Services: Plant hire In 2018, Quattro Group acquired AB2000, a Scottish plant hire firm. AB2000’s
»» No. of employees: 850 Glasgow, Aberdeen and Inverness-based teams, depots and fleets supplemented
the existing organisation, and additional trading divisions were added – mobile
»» www.quattroplant.co.uk
crane hire, Phoenix Weights, Phoenix Marine and quarrying.
Safety and reliability are cornerstones of our organisation. With 850 team members
based at 15 depots around the country, an in-house training provision was created
in order to guarantee that everyone received the same level of training and could
deliver to the same standard to customers.
Five Quattro Occupational Training Academies – or QOTA – deliver state-of-the-art
training to operators, while management staff receive classroom-based health and
safety modules.
18 | QUATTRO PLANTINFRASTRUCTURE & DEVELOPMENT
Anyone who has travelled on a train within the group, with a Let’s Talk
regularly will appreciate that the poster campaign and the promotion
railways are getting busier. In order of the Quattro Group Mental Health
to ensure that the network always First Aiders.
“
operates safely and reliably for millions
Sitting within the innovation sector is
of passengers and freight vehicles, it
is vital that ongoing maintenance is
one of our most ambitious projects, Sitting within
the launch of a Knowledge Transfer
delivered on time.
Partnership scheme with Exeter the innovation
As an organisation, the Quattro Group University, which sees the team
working with experts to develop the
sector is one
is passionate about development, both
internally and within the industries world’s first fully hybrid vehicle for use of our most
we serve. We appreciate that the
industries we work in never stand
on the railway.
ambitious
still, so we think it is essential to Derailing development projects, the
keep moving forwards, and continue
changing for the better. However, there is one challenge launch of a
that threatens to derail our plans for
ongoing development. The current
Knowledge
30@30
five-year Network Rail funding period Transfer
In July 2019 we celebrated our 30th has had a very slow start, with the
year in business. We couldn’t let such recently released Department for Partnership
a milestone pass by unmarked and
wanted to honour our birthday with
a plan that showed our appreciation
Transport Rail Network Enhancement
Pipeline publication detailing very
few committed projects available
for England and Wales. Projects in
scheme with
Exeter
“
of everyone who has helped the
organisation get this far. Scotland are more promising, although University
there are concerns that work will not
We chose six topics to focus on, with start trickling down until 2021.
30 tasks to complete by July 3, 2020,
our 31st birthday. Each element is Unfortunately, despite this there are
designed to improve the way we still huge financial requirements that
do business in some way, bringing suppliers must adhere to in order to
supply compliant machines to work on A varied fleet of tracked
benefits to our staff, customers and
machinery makes
wider industries. the nation’s infrastructure. Suppliers
Quattro Group one of
such as Quattro Plant hold a large the largest providers of
The 30@30 plan focuses on the vehicles to the UK rail
following: industry
»» Environment and sustainability
»» Charity
»» Innovation
»» Investing in people
»» Safety
»» Community.
The 30@30 initiatives explore different
elements of the business: sustainability
projects such as investment in a new
range of environmentally friendly
sweepers, while Investing in people
sees an expansion of the mental
health support services offering
QUATTRO PLANT | 19THE PARLIAMENTARY REVIEW
Highlighting best practice
Innovative and cutting-
edge systems are
designed to promote kit supply, over 350 core machines, our machines will continue to be
safe working practices and must ensure that compliant overhauled to the very highest
in this safety-critical
industry kit is always available to service specifications, making sure they are
required works. in prime working condition. However,
until Network Rail’s signal turns green,
Before it can clock up its first
there is very little room for progression
working hour, each machine has as a plant organisation.
to be converted to work on the UK
rail network, at a conversion cost of We initiated a lobbying of Parliament
“
around £250,000. Some of these in England, Scotland and Wales to
make the Rail Transport Committee
We see our machines may only work one shift a
week. Despite this, every machine has understand this issue that On Track
future as one to undergo a complete overhaul of Plant operators are facing and consider
an overhaul. However, this issue will
the specifically tailored rail elements
of innovation every seven years, at a cost of around not go away until at least 2021. By
and hope to £100,000 each time. this stage, there is a very real danger
that we, and our peers, may have
continue to Despite a lack of planned works in the
pipeline, this annual rolling overhaul
lost talent to other sectors, and sister
organisations who simply cannot
provide a maintenance cost of around £4 million afford to continue will be lost from the
steady flow of
work for our
“ must be found in order to ensure
that Quattro Group’s key machines
are available to service the needs of
the network.
industry forever.
We see our future as one of
innovation and hope to continue to
employees provide a steady flow of work for
our employees. We are working to
Being held at a red signal
innovate more and are looking at
As a business committed to continual both the engineering and design sides
innovation and internal development, of our industry. The opening of our
being stuck at a red signal is research development centre near
frustrating. We will continue to push Newton Abbot and close to Exeter
forwards with plans to deliver exciting University promises us a future that
projects that benefit our hardworking lives up to our past.
staff and valued customers, and
20 | QUATTRO PLANTINFRASTRUCTURE & DEVELOPMENT
Creator Scaffold Designs &
Temporary Works Consultants
Detail by design
Managing Director Ryan Berry
C
reator celebrated its fifth birthday last year, and
Managing Director Ryan Berry tells The Parliamentary
Review that it was creative engineering expertise and
an uncompromising focus on customer satisfaction that drove
them to that milestone. Ryan says that consistency, quality,
value for money and reliability are the four pillars of Creator’s
business. He discusses the firm’s history, ethos and vision. FACTS ABOUT
CREATOR SCAFFOLD DESIGNS
& TEMPORARY WORKS
My brother and I founded the company in 2014 and since then we have achieved CONSULTANTS
significant year-on-year growth with the company now turning over £950,000 »» Founder and Managing
a year. Although our area is structural engineering, we focus specifically on Director: Ryan Berry
temporary structures and work with a wide variety of clients, including English
»» Established in 2014
Heritage and Sellafield Nuclear Decommissioning. We have 18 members of staff
»» Based in Sheffield
with a diverse range of skillsets, from technicians to graduates studying for master’s
degrees in structural engineering, with some seeking full professional accreditation, »» Services: Design of temporary
which is rare in our field of expertise. structures, specifically
scaffolding and temporary
Our diverse range of clients leads to a diverse range of projects. Although we are works
based in Sheffield, we work across the entire country. For instance, we are currently »» No. of employees: 18
working on a ten-year project to support the re-roofing of St Paul’s Cathedral in
»» creator-scaffolddesigns.co.uk
London. We have also worked overseas on a number of projects. We have gained
all of these clients through word of mouth and we have never advertised beyond
our website and social media presence, which is a testament to the quality of the
projects we deliver.
The temporary structure sector can be quite archaic, often still adhering to
permissible stress design models, but we see ourselves as leaders and innovators,
CREATOR SCAFFOLD DESIGNS & TEMPORARY WORKS CONSULTANTS | 21You can also read
