News from the Regions

LONDON AND SOUTH EAST

Mike Lloyd, LTC Scaffolding Limited

The last 12 months have been well documented by others and I am sure will be adequately covered by my fellow regional chairs, but to sum up we have had a year of continual adjustment to the changes in the economic and social environment, whether due to Covid-19 and the various lockdowns we have been subjected to or the realisation of the ramifications of Brexit. Initial fears of an economic meltdown were not realised by our sector as most of us ended up having a pretty good year aided by the Central Government push to keep construction going.

What about the challenges ahead:

1. We need more of the same from Central Government as we forge into 2021. Economic forecasts from the Bank of England look promising, however early signs are of a slowdown in some areas of public sector expenditure, but we must as a body exert pressure and influence to avert that slowdown which could have a negative impact on the construction industry, and thereby the whole economy if allowed to come to fruition.

2. The roll out of the Covid-19 vaccine seems to be the foundation from which our hope springs but this will need to be supported by successful treatments for the symptoms as the length of immunity seems unsure at the moment. We must be alert and respectful to our clients’ concerns and requirements regarding Covid-19 but also be respectfully mindful of over eager safety officers adding to risk.

3. The end of the furlough scheme seems imminent. This might have an impact on the short-term economic outlook, and we must be live to any impact to the economy as a whole, but recovery and re-employment should follow.

4. Covid-19 and the measures introduced have served to increase our costs on multiple fronts:

- Reduced productivity as we seek to adhere to social distancing. - Increase in costs and amount of PPE.

- The increase in congestion charge and the introduction of the ULEZ scheme amount to no more than a tax on our businesses. - We now have the onset of increased import charges resulting in the cost of our materials rising by as much as 15% in a short period of time. - All have served to increase our costs whilst the rates being charged have been suppressed, thus eroding our margins. 5. In light of the recent case of The FSA v Hiscox and RSA, it might be worth checking your business interruption insurance with reference to notable diseases, the government having inferred Covid-19 to be a notable disease. This could be an avenue for bona fide loss recovery as a result of the impact of Covid-19.

6. The exploitation and manipulation of self employment by non NASC members is a challenge we have to overcome. The onset of IR35 will hopefully serve to close that avenue and level the playing field thus enabling NASC members to differentiate solely by the quality of their service and work. IR35 will place the construction industry under greater scrutiny by HMRC.

NASC members should fare well, as this is one of the variables we are audited on.

7. Reverse Charge VAT has been introduced to weed out VAT fraud from the construction industry. The initial impact on our businesses will be to cash flow as we will not have the benefit of relying on VAT funds. This will work its way through very quickly for those exercising sensible financial planning and management.

8. Recruitment and training will continue to be key to the development of our industry, as we look to recruit fresh and enthusiastic individuals to strengthen our image and reputation.

I urge all members to take advantage of the recruitment facility now incorporated into our NASC website and to spread the word about its existence especially with regard to opportunities for new entrants into the industry and apprenticeships, especially those of a more traditional route. Please post your apprenticeships adverts on the website as we will look to expand its exposure to other careers forums.

9. The next few months will offer more than the usual challenges. Nurturing existing client relationships will be essential as we strive to give customer focused service at all times.

There is much great guidance and advice offered through the NASC so please take full advantage of what is available.

MIDLANDS

Phil Heffernan, Scaffold Erection Services Ltd

The country entered its third lockdown during the first quarter of 2021 but thankfully the scaffolding and access sector within the construction industry continues to perform with construction a key industry for the economy of the UK.

The Midlands region appears to mirror the continuance in the UK and almost all the region’s scaffold companies remain busy.

The Job Retention Scheme remains in place during this quarter and some member companies continue to use this facility. This may well continue beyond March 2021.

It is unknown when this lockdown will be eased or if indeed further lockdowns will be required throughout the year. We do though rely upon and forecast construction activity remaining at reasonably busy levels throughout the year.

The good news about vaccine development and deployment has been offset by the emergence of a new, more transmissible, strain of the virus. There is significant positive news from the Scientists that variants in relation to the Vaccine will not limit its effectiveness, and we hope for the vaccine rollout to escalate and some normality return later in the year.

After a couple of postponements HMRC are committed to introducing Reverse Charge VAT from March 1 2021. The main purpose of this is to combat fraud in the construction industry whereby some dubious suppliers of construction services were charging VAT on their invoices but not paying this across to HMRC. Organised crime is believed to be involved in this.

The legislation seeks to stop this by making the customer pay HMRC direct rather than the supplier. NASC member companies are generally net VAT payers as most customers are charged VAT and the largest proportion of cost is PAYE labour.

This legislation will adversely affect our cash flow (previously received cash from customer for VAT which is then paid over later to HMRC on a quarterly VAT return), create another administration burden to manage and accounting software will need to be updated including invoices being redesigned.

HMRC are keen to go ahead despite the difficulties of the present pandemic and Brexit so hopefully all of our member companies are now ready for this major change.

NORTHERN AND N. WALES

Darren Maratty, Interlink Scaffolding Ltd

Well, who would have thought back in September when I penned our autumn report, that the country would go into another full lockdown? Here we are starting 2021 the same way we left 2020. But I suppose we can see light at the end of the tunnel, even though it’s small, it’s getting brighter, especially now that the vaccine is being rolled out (very successfully I may add) and the numbers are starting to decrease. Another plus sign to come out of lockdown is that we almost have full teams on Friday and Monday mornings. Long may that continue, but somehow I doubt it once the pubs are back open!

We have probably all had our fair share of Covid-19 cases within our companies and January was a high level within ISL, at one point 12 of our employees either isolating or testing positive. This in itself creating problems, as all these cases are that out of the blue phone call “tested positive” or partner has “tested positive” amongst other reasons we have all probably received.

This means we are short on staff that needs to be filled quickly. It’s a problem that is not easily solved as there isn’t enough time or enough labour and certainly not anybody willing to start for a weeks work at very short notice. Fortunately though, our main clients are having the same problems so understand the issue, but that still doesn’t stop them having a go at us.

A lot of companies’ office staff are still working from home and to a certain extent “it works”, all the work that needs to be done gets done. Most scaffolding companies are built upon the closeness and camaraderie of their staff. A lot of business owners and senior managers are very family friendly and when you’re working from home, we all miss that office friendship and banter that is created when we are all as one. So even though the working from home works, deep down I think we all long for the days back in the office with the full team around you. Once this happens we know we are on the way back to the sort of normality that we are used too.

As mentioned back in my autumn report in regards a mini boom. This doesn’t seem to be slacking in any way, but what is noticeable is a lot of uncertainty has crept into the market with the prices getting tightened not loosened, even though we all have tighter Covid-19 restrictions put upon us. But I suppose the ones who are still here and have made it through the toughest time of our business lives will prosper. “Things can only get better” - that song will probably be stuck in your head all day now.

Now that we are slowly heading back to some type of normality. We have to start to worry about the normal run-of-the-mill company issues like Reverse Charge VAT, enough materials, enough labour and many more issues that go with the day to day issues of running a scaffolding company. But I also think we have to worry about what issues we will have further down the line. I don’t want it to sound like it’s all doom and gloom as hopefully it’s not. But recession, mini depression, economy wrecked and Brexit are all topics that have been mentioned in the MSM Media in recent months. And unfortunately these are all topics that we must consider and overcome to the best of our abilities.

But for now, let’s all look forward to what we have hopefully coming up within our region and hopefully the rest of the regions. Lockdown finished, brighter and longer days, more work in the pipeline and most of all our own, our family’s and our employees’ physical and mental health. And hopefully that the Covid-19 legacy is left well and truly behind us. So stay safe everyone and think of the good times ahead. And a big thank you to the NASC team for the Covid-19 updates.

It’s been a really tough 2020 for the industry where we have all faced unprecedented challenges due to Covid-19, be it home working, doing Zoom/Teams calls even for Council meetings as well as our own NASC AGM. To say we are all glad to see the back of 2020 would be an understatement. What was nice to see during the early part of this pandemic was how people pulled together to help each other as well as our own industry.

We now enter 2021 faced with similar challenges but with a vaccine now getting rolled out hopefully a return to normal shouldn’t be that far off. Our focus still needs to remain on following the guidance issued to our industry where we have demonstrated we can continue to work safely with the tighter restrictions. The focus on health, safety and wellbeing of our colleagues needs to be of high importance.

Following the Scottish Government’s announcement earlier this year, Scotland’s construction sector can remain open but the situation remains under review.

There still remains confidence in the industry that there could be a bit of bounce back in 2021 which we all hope is the case.

SOUTH WEST AND S. WALES

David Anderson , Allen & Foxworthy Ltd

As Chairman of our region I have had a number of conversations with various directors and managers since my last update in the Autumn 2020 edition of this magazine.

It seems it’s been a very hit and miss time for most during this awful coronavirus pandemic.

Some companies are reporting a steady flow of work during these difficult times depending on the scale and size of contracts. Others are experiencing slower turnaround on larger projects and is affecting labour numbers required on programmed works. There seems to be a large increase in numbers on smaller domestic property works such as extension and home repairs, spending intended holiday savings, I guess.

Furlough has continued to be a godsend to fill the gaps between the peaks of current work situations for a lot of companies, it would be foolish not to take advantage of it going forward until it ends in a few months’ time. Administering this seems to be a lot easier with time and companies can organise their work loads around this very good and helpful scheme the Government has established for the majority of nation’s workforce. However, it will come to an end and we all should start to prepare to stand on our own feet in the future.

The need to be aware of the mental health and wellbeing of our staff has become very evident during this period as I have been informed of pressures from outside our normal workplace affecting some staff members’ performance and normal attitudes.

Please encourage your teams to discuss problems they may have at home and at work, who knows we all may be able to help them going forward. Also remember the Lighthouse Charity that can give fantastic support and advice to our industries operatives.

Covid-19 isolating \ positive test has been an added bug bear for organising staff on projects but of course nothing like the distress caused by families that are sadly being put through the wringer with illness and deaths of loved ones.

On the positive side vaccinations should help us all in the long run and sincerely hope our members and colleges can look forward to a brighter future. If anybody within our region has any issues or things they would like raised in future publications or our regional meetings please feel free to contact me or call NASC Head office for assistance.

The far South West region has continued to work well, following the latest NASC and CLC guidelines, and there has not been much of a downturn for the area. Many new opportunities have arisen, with businesses suffering from the enforced shutdown carrying out maintenance and renovations they may have been previously unable to do. There are lots of places which require additional space and temporary scaffolding extensions are popping up on warehouses and essential stores.

There appears to be a solid pipeline of work coming through with enquiries still strong and a lot of long-term projects in the offing. If these carry on through the prospects for 2021 are even better than they were at this point in 2020, and although there is no immediate ending in sight – at least we all know a bit better what we are doing now, and how to handle the current situation

Wales in Focus

Like other nations in the UK, the scaffolding industry in Wales has continued to make a valued contribution to the wider construction sector and has assisted in the recovery of the economy during the pandemic.

Despite a promising summer, Wales faced tighter restrictions during the second half of 2020, entering 2021 in a Tier 4 lockdown, but cases continued to rise. Those working in construction have not had the option of working from home or being furloughed but have still been expected to continue working under Covid-19 guidelines from the CLC and the NASC. Many have the added stress of bouts of self-isolation and the immense loss of loved ones. With no absolute end in sight, and the realisation that things will not return to what they were before, it is hard to keep spirits up.

The impact of Brexit is yet to come and after speaking with one of the main suppliers of scaffolding and access equipment in Wales, it appears that Brexit will not really affect the supply or pricing of goods in the long term. Many distributers have taken the precaution of ordering in anticipation of problems, but these goods have not materialised yet. The wider issues around global logistics, steel prices and the exchange rate may see availability and prices of all scaffolding equipment in the UK increase significantly in the first six months of this year.