21 Apr 2016

FMB and Unite agree pay rise for SME workers over the next two years

SME builders are in line for a pay increase after the Federation of Master Builders and Unite agreed a deal that will see wages rise by more than 5 per cent over the next two years.

Under the terms of the deal, workers will see their wages rise by 2.5 per cent this year and a further 2.5 per cent in 2017.

The Building and Allied Trades Joint Industrial Council agreement was struck after the successful conclusion of negotiations between the FMB, on behalf of SME construction employers, and Unite, on behalf of workers.

The rise will cover all workers, with the exception of the lower paid general operatives, who will see their hourly rates rise by 4 per cent this year and 2.5 per cent in 2017.

The agreement will also be “inflation-proofed”, meaning that if inflation is higher than 2.5 per cent in 2017, then the pay rise will match this up to a limit of 3 per cent.

FMB chief executive Brian Berry said: “This is a good deal, which provides certainty and reassurance to employers and employees alike.

“It strikes the right balance between on the one hand recognising the importance of boosting pay in line with solid growth and positive future expectations, and on the other hand accepting that margins continue to be tight and the economic outlook continues to be clouded by a number of uncertainties.”

Unite’s national construction officer John Allott said: “The higher increase to the lowest paid was needed, as many operatives’ living standards took a knock during the economic downturn.

“The inflation-proofing of the second year’s rise provides some further reassurance that living standards will receive protection against a jump in inflation.”

09 Apr 2016

Scape faces criticism from SME group Construction Alliance Northeast over new £5.5bn national framework

Scape’s new £5.5bn framework plans have been criticised by an SME group for failing to allow small businesses to win a place.

Construction Alliance Northeast, a group representing more than 500 contractors and engineers with a combined turnover of £3bn, hit out at a minimum turnover threshold requirement in Scape’s £5.5bn national framework.

CAN secretary Douglas Kell said: “It would seem with five lots covering such large regions as UK-wide, Scotland and Ireland that either Scape is deliberately trying to restrict the number of contractors able to apply or is assuming that large, national contractors will qualify because their supply chain can be located at a reasonable distance from their bases.

“This means SMEs will only be able to aspire to the role of tier two contractors or otherwise Scape has a lack of understanding of construction logistics.”

SMEs have criticised recent national frameworks including the Education Funding Agency’s £5bn Regional Framework for freezing out contractors who don’t meet minimum turnover thresholds.In response, the EFA has indicated it will limit the number of lots contractors can win on the revised framework, due to come into force next year.

CAN has turned its attention to the new Scape framework, which will replace the £1.25bn major works framework for which Willmott Dixon is the sole contractor.

That framework has also attracted criticism in the past, as Willmott Dixon has been the sole contractor since its inception in 2005.

But Scape’s strategic procurement manager said the lead entity turnover required was in “no way a barrier to SME involvement” and that SMEs could bid for the national construction framework in collaboration.

John Simons said: “SMEs can collaborate and bid as in a joint venture or consortia arrangement, ensuring that an organisation of an appropriate scale, skill and scope is appointed to deliver the volume of projects facilitated by this framework – a point which will be emphasised in our upcoming framework market awareness sessions.

“In addition, SMEs can reap numerous benefits by operating as part of the supply chain, in terms of business growth, expanding senior team knowledge and industry contacts through innovative project exposure.”

Mr Simons said that since Scape Group’s inception 10 years ago it had worked with 36,900 SMEs and had spent more than £1.3bn within 20 miles and more than £2bn within 40 miles of project sites.

He added: “The National Construction framework, as with all of our frameworks, is designed to include micro, small and medium-sized enterprises at all stages and our track record of extensive SME engagement is proven.

“We, together with our partners, continuously engage SMEs throughout the process and since Scape Group’s inception 10 years ago we have worked with 36,900 SMEs. Local procurement is also extremely important to us.

“We not only require our partners to engage with SMEs; they must commit to a high percentage of SME supply chain spend across their subcontractors – we proactively measure our success in this regard, which is one of our key performance indicators on every single project and across the whole framework.”