黑洞社区

The man who until two months ago was the government鈥檚 chief construction adviser, Peter Hansford, has reached some uncompromising conclusions about the state of an industry that he says is unsustainably fragmented, and what that means about what it can expect from the new administration.

鈥淕overnment has put money into those industries [that have] come up with a compelling investment case, and that鈥檚 what construction needs to do.鈥� Has it done it? 鈥淣ot yet,鈥� he says.

While Hansford鈥檚 stark analysis might well be a tough message for the sector, he may likewise find there are those in the industry forming their own opinions of his tenure as the industry鈥檚 leader in Whitehall, a role he describes as the 鈥済lue鈥� connecting government with the sector. Because, unfortunately for the industry, that glue has come spectacularly unstuck, the role being canned by the government out of the blue last year amid a wholesale rethinking of the government鈥檚 relationship with business. Former RIBA president Jack Pringle - writing in this magazine - described the move as a 鈥渄isaster鈥�.

There is no reason to think that decision was reflection of Hansford鈥檚 abilities. The 61-year-old former Institution of Civil Engineers president was due to step down in September whatever happened. But with the original creation of the chief construction adviser (CCA) job in 2009 seen by the industry as a major victory, could he have done anything to prevent its axing? How does he think his contribution as chief construction advisor will ultimately be assessed? And with Hansford in a more relaxed mood since leaving the post, will this naturally diplomatic man break his silence to say what he really thinks of the decision?

Hansford took up the construction advisor job from QS Paul Morrell, a former Davis Langdon senior partner, in the autumn of 2012. Where Morrell had focused on sustainable construction, government procurement and BIM during his tenure, Hansford鈥檚 primary preoccupation was the sector鈥檚 industrial strategy, Construction 2025.

Commissioned by then business secretary Vince Cable, Hansford drew up the industry/government joint document in consultation with the sector in just six short months, and topped it with eye-catching targets to lower construction costs, cut the time taken to build, improve exports and reduce carbon emissions. The aim was the creation of a high-tech world-beating construction industry in little over a decade, and delivery was to be taken forward by a newly-formed Construction Leadership Council (CLC) with a delivery group sitting under it. 鈥淚鈥檓 really proud of the way the industry has come together over Construction 2025,鈥� he says.

However, acclaim for the strategy hasn鈥檛 been universal. Some have questioned how achievable and credible its round-number aims are, with Hansford鈥檚 predecessor telling 黑洞社区 in December he wanted to see 鈥渘o more damn fool targets which are there presumably just to catch the eye of politicians and the media鈥�. The most common criticism, however, has been that it is a strategy without an implementation plan.

Hansford, a former civil engineering project manager on the construction of the Docklands Light Railway, clearly has sympathies with this view - in fact he admits now that an implementation plan for the strategy was drawn up but never published - but he says ultimately the criticism is based on a misunderstanding of how government works.

No apologies

鈥淚 started thinking we needed a detailed plan for this - when are we going to do this bit, when are we going to do that bit and who鈥檚 going to do that? And it鈥檚 not quite like that,鈥� Hansford says. 鈥淚 would have needed - in my old world - a project management office, a reporting structure, and an army of 30 people, centrally, to make this happen. But you can鈥檛 do that in such a complex industry and frankly I didn鈥檛 have the resources for it either.

鈥淎ctually [it is done by] setting a direction, getting hearts and minds buy-in, and getting commitment of key people to make it happen. Then to some extent you鈥檙e entrusting it, relying on the collective goodwill of industry and government to take it forward. I had to become a bit more relaxed about it. I鈥檓 not apologising for it.鈥�

He isn鈥檛 apologising for the strategy鈥檚 targets either. 鈥淵es there was an element of - I鈥檒l confess now - I wanted some round numbers,鈥� he admits. 鈥淣o one would have remembered [targets of] 32 and 54 and 49. The amount of science behind those numbers is maybe questionable, but the direction is right. Should it be 33% or 32 or 36? I鈥檓 not going to argue about that, I don鈥檛 care. The point is, they鈥檙e not unrealistic, and nobody鈥檚 told me they鈥檙e unrealistic. People who are criticising the actual number are being pedantic.鈥�

Hansford says the crucial test of the strategy鈥檚 success is not these questions, but whether it is still defining the agenda for those looking to reform the industry. 鈥淚 worried that it might be a flash in the pan. That鈥檚 not my view [now]. I think things are changing. I think if somebody was to write the construction future agenda today I don鈥檛 think it would look very different - which means I think we got it about right.鈥�

The other thing Hansford is proud of is the body set up to deliver the strategy, the CLC. He isn鈥檛 at all perturbed by the fact it was slashed in size last year, from the original 30-strong format, to just 12 members. Far from it - he says the change was a 鈥渉appy coincidence鈥� of his own thinking coinciding with ministers鈥� views that the previous incarnation had always been 鈥渕uch bigger than I wanted it to be鈥�.

Many of those shut out of the top table in this new slimmed-down form have voiced concerns the new body is contractor-heavy, with Bouygues鈥� Madani Sow, Laing O鈥橰ourke鈥檚 Anna Stewart and Mike Putnam of Skanska all appointed.

Is it dominated by contractors? 鈥淚t鈥檚 not,鈥� Hansford says. 鈥淭here鈥檚 some great people from the design side, people like [BDP chairman] David Cash, we鈥檝e been very cognisant of having the right voices there. But, yeah, inevitably there are a number of contractors [on the board]. Why is that? Hey, they鈥檙e some of the leading players who are going to make things happen in this industry, like it or not. I wouldn鈥檛 apologise for that.鈥�

Hansford seems oddly detached over the outcome of another of his major initiatives, the industry payment charter, launched with fanfare in 2013 as a bold bid to solve the poor payment practices which have dogged the industry for decades, but to which the government seemed to initially struggle to get traction with major contractors. Critics at the time said the charter would have little impact without monitoring or enforcement of its provisions built in - something which the government said it was working on. So have these provisions been settled and who has now signed on the dotted line? Hansford says he is confident the charter is being taken forward, but that I should ask the business department for the detail. 鈥淭his is one of the workstreams being taken forward by Madani Sow, but it鈥檚 not close on my radar really,鈥� he says.

Industry woes

Happily, being out of government seems to have freed Hansford to speak his mind more. There is no doubt he is passionate about reforming how the industry works, and losing the job title means he can be more critical. He says the sector has both too many individual firms, and too many trade bodies representing it. Industries such as automotive and aerospace have had more success in recent years by consolidating into large systems integrators powered by structured, organised supply chains.

鈥淢y view is that we have too many players,鈥� he says. 鈥淲e waste so much money in this industry in our interfaces. If you were to design an industry you wouldn鈥檛 design it the way we鈥檝e got it. It鈥檚 a personal view but I think, if we鈥檙e really going to change construction, we need less players.

鈥淗is view is this sector鈥檚 structure doesn鈥檛 generate enough profit to allow firms to invest in innovation, with 黑洞社区鈥檚 top 150 contractors generating an average pre-tax margin of just 1.2% last year. 鈥淚 don鈥檛 think it鈥檚 sustainable. I think it鈥檚 resulting in an unhealthy, sub-optimal industry. Procurement is only part of it. It鈥檚 chicken and egg really: You procure the way you do because the industry model is the way it is. It鈥檚 how you break that circle that鈥檚 interesting.鈥�

This fragmentation clearly made Hansford鈥檚 job much harder. His initial idea was that Construction 2025 would effectively be rolled out by the industry鈥檚 trade bodies, who manned the 鈥渄elivery group鈥�. However, the body made little progress and was eventually disbanded. 鈥淚t was never, in hindsight, going to be the vehicle to deliver C25. I thought it was,鈥� he admits. 鈥淏ut I was wrong. Their role in life is to represent their members. I suppose we were asking them to do something they weren鈥檛 set up or equipped to do.鈥�

Hansford says the decision to cancel the 拢125k a-year CCA role was influenced by the politics of continuing spending austerity, though he admits that ultimately this wasn鈥檛 the deciding factor, as industry trade bodies offered to fund the salary.

I wanted round numbers. No one would have remembered [targets of] 32 and 54 and 49. The amount of science behind those numbers is maybe questionable, but the direction is right

More, he says, it was an expression of a change in government thinking after the election, that Hansford understands and accepts. 鈥淚 think a fundamental change in philosophy of the government we elected last May is that it wants industry to lead itself, and it wants it to not be funded by the public purse. This is about industry putting its money where its mouth is. Therefore the resource should be coming from industry. For me 鈥� politics doesn鈥檛 come into this,鈥� he says.

But does this necessarily mean it was right to scrap his job? 鈥淚 was surprised when the role was removed. I understood the need to make a change, and I made clear my views about whether or not that was the best way to do it. At the end of the day, ministers decide.鈥�

While he will not be critical of the government, it鈥檚 pretty clear he disagreed with the decision because he thought the CCA role still had value. 鈥淚 wouldn鈥檛 have done it if it had no value. Of course it had value. That鈥檚 not in question. [In September] I talked about how it was important that the baton wasn鈥檛 dropped, and I was going to ensure any gaps created by the loss of the role were filled in an appropriate way. By then I鈥檇 reached the conclusion that some things you can fight, some things you can鈥檛; you have to accept that this change is going to happen.鈥�

Despite this evident disappointment, however, he does remain positive overall about the changes made by the new government. 鈥淭he point in question is will the absence of the role impede the changes that need to happen? Construction 2025 is not a series of discrete projects, it鈥檚 a series of interlinked initiatives, and the risk is they won鈥檛 be properly interlinked. But I think that鈥檚 recognised, and I think that Andrew Wolstenholme in his role [as CLC co-chair for the industy] sees that. If they need to fix it in some way in the future, then I鈥檓 sure they will.鈥�

Hansford is making a good job of minimising the problems created by abolishing the role - and in some ways he鈥檚 damned if he does, and damned if he doesn鈥檛. If he鈥檚 right that the role won鈥檛 be missed, then there鈥檚 an implication his work didn鈥檛 have much value in the first place. Unfortunately, the best construction can do is hope he鈥檚 right that his agenda will continue to be taken forward more collectively.