A BUSY YEAR AHEAD

January saw the staging of the postponed MPA Health and Safety Awards and Conference in London when the latest innovations and good practices helping to keep workers in the UK mineral products industry safe and well were showcased – and it is congratulations to Kilwaughter Minerals on their success as winners of ‘Safer Through Improvements in Health & Wellbeing’ category. Details of all the entries for the MPA Health & Safety Awards will be added to SafeQuarry. com, the free-to-access mineral products global hub for health and safety. Videos of the finalists and winning entries can be viewed on the MPA YouTube channel which also features a film of the whole of the 2022 awards event as well as previous years. Meanwhile, MPANI and HSENI have begun making preparations to host the All Island Safety Conference in October at the Armagh City Hotel. More on the arrangements will be published soon. On the economic front nationally the UK economy saw a meaningful loss of momentum in the second half of last year and is expected to suffer a shallow recession in 2023 and contract by 0.9%, before a modest return to growth in 2024 (+1.4%).

As well as developments on global energy markets, chronically-weak business investment, structural issues in the labour market and public sector pay disputes threaten to hold back the economy’s progress over the next couple of years. The Construction Products Association’s (CPA) new winter forecast outlined a 4.7% decline in construction output in 2023 and only a modest 0.6% recovery in 2024. Locally, the latest Construction Employers Federation survey and Ulster Bank monthly PMI report paint a fairly pessimistic picture, at least in the short to medium term, for the local construction industry. The CEF Construction Survey reflects a local construction sector that remains busy in terms of current workloads, but also a sector where immediate to medium term cost pressures prevail alongside a growing pessimism about market opportunities over the coming year.

The survey, which collected data from NI-headquartered firms which have a collective annual turnover of approximately £2.5bn, covers the last six months of 2022 and reflects on many of the key challenges that contractors, civil engineers and homebuilders are currently facing. The main findings included:

• Looking at 2022, 50% said their profit margins had worsened or significantly worsened in comparison to 2021. Over the same period, 20% had seen an improvement in profit margins.

• 62% of respondents do not expect their annual turnover to increase in 2023. Indeed, some 43% are looking to consolidate their business over the coming 12 months –with 27% looking to increase profitability.

• 67% of firms said they were either at full or almost full capacity. Only 7% currently had capacity for significant levels of new work.

• Materials availability challenges have receded – 80% saying any issues are now manageable.

• Inflationary issues remain – 63% of respondents said these were continuing to pose serious financial concerns and 85% said they expect material costs to continue to rise.

The Ulster Bank PMI highlighted that Northern Ireland’s private sector started last year in expansion mode as the post-pandemic economic recovery gathered pace. Last January, businesses were optimistic for the year ahead with the expectation that growth would continue. This proved not to be the case. Largely as a result of the Russian invasion of Ukraine, which added fuel to the cost-of-living crisis, growth petered out and confidence ebbed away. Northern Ireland’s private sector therefore ended the year on a much more negative note. December saw output and orders fall for the eighth successive month. The contraction in output was the steepest in a decade outside of lockdowns. All four sectors posted declines in output and orders although retail, services and construction firms did increase their staffing levels.

The good news is that inflationary pressures moderated with firms reporting the weakest rise in input costs in 22 months. As a result, firms raised their prices at their slowest pace in almost two years. But these price rises still exceed anything that occurred in the pre-pandemic era. This time last year, firms were braced for a challenging year, but it turned out much worse than anticipated. December’s report suggests that negative sentiment is receding and that we may have passed peak pessimism. This year, expectations for the 12-months ahead are low but we could see the converse of last year with expectations being exceeded this time around.

Age Profiling

MPANI has recently launched its 2023 Age Profiling Survey. The success and long term sustainability of any industry is dictated both by the quality of the people within it and its ability to attract qualified, enthusiastic young people with the right work ethic. The Association last carried out an age profiling assessment back in early 2020 that again highlighted the ongoing reality that we have an ageing workforce. MPANI will use the results to inform members and relevant industry stakeholders of the critical succession, skills and recruitment issues facing the industry with a view to formulating and implementing an industry wide plan to address these worrying trends. Meanwhile, MPANI are currently drafting its response to the Department for the Economy Consultation on the Circular Economy. This draft strategy sets out a vision that by 2050, Northern Ireland will have an innovative, inclusive and competitive economy where business, people and planet flourish, with responsible production and consumption at its core. Construction material suppliers will have a key role to play in achieving many of the targets. Once again however I fear this is the public sector telling the private sector what to do! At the same time the reality is most of the private sector are already innovating in terms of decarbonising, automating, energy efficiency and recycling. As many of you know and have direct experience of it, the public sector does not lend itself to quick decisions and risk taking. One just has to look at the adoption of renewable energy on the government estate and the roll out of electric vehicle charging infrastructure.

Competition And Mergers Authority

I recently attended the opening of the new Competition and Mergers Authority (CMA) Office in Erskine House Belfast along with other business representatives. In a very engaging questions and answers session a number of us asked how the CMA might help in ensuring that Government procurement policy and energy policy can act in a way that enhances competition here in NI and protects businesses, particularly those exporting materials and products. I highlighted the current uncompetitive, and in many ways discriminating, policy that means rural businesses have to pay huge fees if they wish to connect to the electricity grid. While in GB, because there is greater competition in the energy market, the supplier will bring the energy grid to your gate and then you pay for the connection. This policy is holding back the decarbonising and energy efficiency of many rural business, it’s unfair, needs addressed at the earliest opportunity and if not will hold back NI PLC journey to the target of Net Zero by 2050.

Annual General Meeting

In other news, arrangements are well advanced for our Annual General Meeting on March 9th in the Dunsilly Hotel, Antrim. This year we are continuing our expert panel “Question Time” session.

worked in Strategic Planning and Policy with Belfast City Council and played a key role in supporting the Council’s Brexit Committee. Outside of work, Claire is Chair of Brain Injury Matters, the regional charity supporting, promoting and empowering people living beyond acquired brain injury.

oil and gas into renewables 30 years ago to form the B9 Energy group of companies.

B9 has developed 10 onshore and two offshore wind farm projects, provided O&M services on 49 wind farms, developed industrial scale anaerobic digestion, 6 x landfill gas power stations, and is now focussed on green Power-to-X projects to provide balancing load for otherwise curtailed wind farms. The hydrogen produced will be supplied to the heat, power and transport sectors and the oxygen used for secondary sewage treatment in the water industry and for Oxygen Enhanced Combustion at base load thermal plants.

Also on the panel is Kirsty McManus, who is National Director for the Institute of Directors in Northern Ireland. The Institute supports 1,000 Northern Irish business leaders through unparalleled access to information, advice, peer networks and learning opportunities. Kirsty has over 20 years’ experience working in markets such as the United States and Europe. She was appointed Chair of the Ministerial Advisory Panel on Infrastructure by Minister Mallon in August 2020 and is a founding member of the Northern Ireland Business Brexit working group.

This year’s panel includes Claire SullivanCBI, Head of Policy, Northern Ireland. The CBI is regarded as the ‘voice of business’ both locally and nationally. It represents around 70 per cent of the Top 100 companies in NI as well as many small firms across the region. Claire recently joined the CBI as Head of Policy, Northern Ireland (July 2022). With over 20 years of experience in strategic public policy and research, she previously

Joining

He is joined on the panel by David Sterling, former head of the NI Civil Service, where he spent his career working in a variety of roles before being promoted Head of the NICS in June 2017. In that role he faced the challenge of delivering public services in the absence of ministers, preparing for Brexit, facilitating the resumption of devolved government in early January 2020 and dealing with the Covid-19 Pandemic. He retired from the NICS in August 2020 and is currently the Chair of Northern Ireland Screen, the Chief Executives’ Forum and is a board member of a number of charities: Ulster Wildlife, the Cancer Fund for Children, the Centre for Cross Border Studies and Women in Business NI.

In Our Thoughts

Alas, we end this month’s round-up of news on a very sad note. A number of our members lost loved ones in 2022. Our thoughts and prayers remain with the family and friends of Pat O’Connor, Will Chambers Snr, Henry Ardis, Christopher Scurfield and Imelda Quinn (daughter of Cormac McDonnell Snr). www.mpani.org