Estates & Facilities 2018
Posted on Tuesday, January 23, 2018 by Venn Group — No comments
Grenfell Tower, budget cuts and Carillion Liquidation... What does this mean for public sector estates and facilities contractors?
The last 12 months has proved to be both challenging as well as devastating for the public sector when it comes to property management and fire-safety. With the country spending the entirety of 2017 on a high terror threat, we didn’t envisage the highest death toll coming from a council owned building in central London. This was followed by an autumn budget that didn’t meet public sector expectation and finally the start of 2018 saw the liquidation of Carillion, the second largest construction company in the country. This has resulted in the displacement of numerous staff and caused wide spread instability for those associated with their public sector contracts.
Grenfell exposed the effects that cost-cutting and short term thinking can have on the local community. The media has exposed that other buildings nationally and internationally have similar cladding with potential shortcuts in the fitting that could result in further disastrous consequences. With seventy-two dead and a devastated community, times have changed and a massive audit is required nationally to ensure that this is not repeated.
The most recent budget has pushed for more housing, increased maintenance and for the public sector bodies to sell off and develop excess property to help bolster the local economies. Although the funding for the NHS appears to be more than before, relatively, taking into account inflation and increase in costs, it is still not as high as in former years. With budgets becoming ever tighter it is paving the way for large scale property rationalisation and space relocation projects.
Already in 2018 there are a number mass refurbishments or new builds in process due to the ageing public sector property portfolio. At the heart of this is the House of Commons refurbishment at a cost somewhere north of £5 billion. Another recent example in the NHS would be the rebuild of Broadmoor, the high security Mental Health Prison owned by West London Mental Health.
Finally we have the news from Carillion in the last couple of weeks which was devastating for their 30,000 staff employed in the UK, a large chunk of which were employed on the PFI contracts they were responsible for. The uncertainty surrounding moving these contracts forward will put major pressure on organisations that use them and also put PFI contracts in general under the spotlight with questions being asked in parliament which could lead to contracts being brought back in house.
Unfortunately, I have not yet obtained the ability to look into the future, but having worked in contract recruitment through a number of major political changes, what I can say is that with uncertainty comes the reluctance to recruit permanently or commit to long-term workforce planning, bearing that in mind 2018 will be a busy year for Public Sector Estates and Facilities Contractors.