Construction Industry (Employment)

– in the Scottish Parliament at 5:03 pm on 24th May 2000.

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Photo of Patricia Ferguson Patricia Ferguson Labour 5:03 pm, 24th May 2000

The final item of business today is a members' business debate on motion S1M-724, in the name of Johann Lamont, on jobs and training in the construction industry. The debate will be concluded after 30 minutes without any question being put. Those members who wish to speak in the debate should press their request-to-speak button as soon as possible.

Motion debated,

That the Parliament notes the increasing opportunities for construction work in Pollok, Glasgow and in Scotland as a whole; believes that the construction industry, working along with the construction unions and Construction Industry Training Board, should provide real training and apprenticeships for young men and women, work to improve safety and regulation in the construction industry and ensure, in conjunction with the Executive, local authorities, Social Inclusion Partnerships and other agencies, that those most excluded in society by poverty and disadvantage are provided with the opportunities to benefit from the jobs created by the boom in the construction industry, and further believes that the Executive should do everything within its power to support these aims.

Photo of Johann Lamont Johann Lamont Labour 5:11 pm, 24th May 2000

In my former life as a teacher, I never spoke to a noisy room, so I hope that everyone will be nice and quiet for me.

I am pleased to have the opportunity to introduce this debate on an important issue for my constituents and for people across Scotland. I would like to make it clear at the outset that I am not an expert in this area, and I am grateful for the information that was provided for me by a range of organisations in the construction industry, including the Construction Industry Training Board, Glasgow City Council building services department and the unions that are involved in this field.

I start by highlighting a situation with the construction industry that I believe creates a problem. Our awareness of the industry is often highlighted only when it intrudes in our everyday lives—when it creates traffic problems or when inconvenient scaffolding is put up. We tend to celebrate the designers of buildings, and the buildings themselves, but often we fail to celebrate the builders. We must recognise the importance of the process of construction to the economy, as well as the product of that construction work. Construction is a hugely important industry in Scotland, employing about 130,000 people and undertaking about £5,000 million of work a year.

We hear a lot about the virtual economy and e-commerce, but it is important that we recognise that many of our fellow citizens are involved in an economy that deals with real materials in real places. At times they battle in difficult circumstances, and many of them are put at risk because of a lack of regulation and safety. Sadly, there remains a significant number of fatalities in the industry; it is crucial that that is addressed. The Health and Safety Executive, according to its figures, was notified of 66 fatalities in the industry between April 1998 and March 1999. The unions have a crucial role to play in protecting the work force and I welcome the important steps forward that the Government has taken in recognising trade unions and their right to carry out that important job.

The motion acknowledges the likely growth in the industry, with its potential to create a lot of job opportunities. It is estimated that, in this part of the world, through the private-public partnership education initiative, the proposed investment in housing in Glasgow and the development of the Clyde village, there may be an investment of £2 billion over the coming six to 10 years. That represents a huge opportunity for the physical regeneration of significant areas of Glasgow. It also represents a huge opportunity for the economic regeneration of some of our most deprived communities.

It has been suggested that, sadly, there may be a significant skills shortage in this city. There is evidence of workers being brought in from places such as Liverpool and Newcastle. The Mackenzie Partnership report from May 2000 quotes the Construction Industry Training Board construction labour forecast in Scotland for 1999-2003. It reckons that there will be a need for an additional 32,000 workers in that period, 17,000 of whom will be skilled tradespersons. It notes that only some 1,400 apprentices are currently registered annually, although that does not take account of the new initiatives that I have identified.

It is crucial that we address the skills gap, to ensure that people in our communities benefit. After all, if workers from local communities get work, they will spend the money in their communities and offer greater hope for regeneration. The importance of targeting training cannot be underestimated in ensuring that that job dividend comes to our communities.

Perhaps too much is said in current political circles about learning from the private sector. Perhaps there is an overwillingness to imply that the private sector model is always the best. We can learn a lot from the work that is being driven forward by the public sector. Glasgow City Council building services department offers an excellent model for innovation and partnership, as it recognises its social role as well as its economic role. Since the early 1980s, it has offered a sustained commitment to apprenticeships. It emphasises encouraging young women into the construction industry; currently 85 per cent of those employed in the industry are men. It offers work experience to school students, has developed partnerships and funding opportunities in a range of areas and has shown a willingness to meet the needs of the young and the long-term unemployed. Moreover, it has provided an accredited training facility to the private sector.

I wish particularly to highlight the important work being done by the council in tackling the issue of pre-vocational training. It is recognised that some of our citizens need extra support and encouragement. Through the pre-vocational training process, in partnership with the council's education service, that support is now being offered. I call on the minister to study that initiative and to work with those involved to see how we might get matched funding, which would allow the initiative to be expanded. That is perhaps an opportunity for active intervention by the Executive.

I wish above all to emphasise how important it is that all involved—the unions, the local authorities, social inclusion partnerships, enterprise bodies, the Executive and the private sector—grasp the importance of the construction industry's social responsibilities and work in partnership to maximise its benefits. I hope that, in the coming period, when contracts are being developed, a willingness to address the social dimension will be given proper credit and will help to define what is best value when those contracts are granted.

There is a huge opportunity ahead of us. With real joined-up thinking across sectors, departments, agencies and unions, we can ensure that high-quality training and real jobs in a safe construction industry will benefit all in our communities.

Photo of Kenneth Gibson Kenneth Gibson Scottish National Party 5:17 pm, 24th May 2000

I congratulate Johann Lamont on bringing this, her second members' business debate, to the chamber. It is important that she touched so much on the reality of what is happening in the construction industry and how important it is that we do not always get diverted into talking about e-commerce and the knowledge economy. I appreciate that that is important, but what is also important is that work is developed that people can see and can touch with their own hands in daily life.

The Deloitte & Touche "Scottish Chambers Business Survey" for the first quarter of 2000 showed that the construction industry in Scotland is in good health, with some 85.7 per cent of companies in that sector working to full capacity. However, 60 per cent also reported difficulties in recruiting staff, particularly skilled manual workers. An obvious reason is that, as Johann Lamont has just highlighted, the number of apprentices who have completed training in construction-related trades is low. In the public and private sectors combined, no more than 543 people completed training in construction-related trades in Glasgow in the past four years, including only 26 bricklayers, 16 slaters and nine plasterers, the vast majority of whom, one assumes, are already in employment.

Given the Executive's hope to create 1,400 jobs for tradespeople from the 3,000 jobs expected to come about following the housing stock transfer, the schools programme that Johann Lamont alluded to and the Clyde village project, my concern is that any investment will be either delayed or carried out by jobbing tradespeople from outwith Glasgow. Indeed, in his winding-up speech in the regeneration debate last week, the Deputy Minister for Local Government stated that

"we are in a city whose social development resulted from economic migration—people came here to build much of our infrastructure."—[Official Report, 17 May 2000; Vol 6, c 752.]

That is true. I am a descendant of such people, as are many people here. Given Glasgow's high levels of unemployment, we need these jobs to go to Glaswegians, particularly in constituencies such as Pollok, where the claimant count is three times higher than the Scottish average—the highest in Scotland—where health is the fourth worst out of 641 constituencies in the UK and where half the children live in poverty.

Training programmes must be stepped up now if we are to ensure that we have a skilled work force to cope with the increased investment in construction from the public and private sectors. I am pleased that Johann Lamont talked about that in her speech. We must support the partnership approach that Johann talked about. Equally, we must ensure that the safety of the work force is paramount as we undertake a programme of development at breakneck speed.

The public sector does a first-class job. I—and a number of other members, I expect—have visited the training programmes in Glasgow and have been impressed by the work that is being done. Glasgow has a tremendous opportunity, but we have to ensure that the construction jobs are made available to Glaswegians. Training must be a priority to ensure that the high levels of unemployment, particularly in our peripheral estates, become a thing of the past in the not-too-distant future.

Photo of Robert Brown Robert Brown Liberal Democrat 5:22 pm, 24th May 2000

I congratulate Johann Lamont on bringing this important matter before the Parliament. The Social Inclusion, Housing and Voluntary Sector Committee happened upon the issue while considering the housing stock transfer. We received a lot of evidence telling us that there was a skills shortage problem and, at the same time, an economic opportunity that has to be grasped.

Like others, I have no expertise in this area, although I once worked on a distillery warehouse construction site when I was a student—I do not know whether that counts as relevant experience. The issue of planning is important. The stock transfer alone has the potential to create something like 3,000 additional jobs in construction. Assuming that a large portion of that number will be skilled tradespeople not labourers, it will take three or four years to train them. It will be a while before the stock transfer gets off the ground, but we can clearly see that there is a time lag problem.

It is important that we get together the various interest groups, such as the council, the Scottish Executive and the colleges. Johann Lamont did not mention the colleges much, but I will mention that South Lanarkshire College has a specialism in construction and has had to lay off staff in the past year as a result of a lack of demand for their services. That is a ludicrous situation and we must deal with it.

We have to get a programme in place, monitor it and identify recruits from the areas in need. As work will be done on the houses in those areas, it seems reasonable that local people should benefit most. The construction industry is noted for the ebbs and flows of its business—at times there is an excess of work; at other times people are laid off. We have to create a situation in which the flow of work is steadier. When the big boost caused by the stock transfer ebbs away, there should be something to replace it.

My final point concerns the issue of safety. As all members are aware, the construction industry employs a significant number of non-employees, by which I mean technically self-employed people who are not protected to the same extent by employment legislation and, for example, do not get paid if there is no work for them. We must encourage ways of maintaining employment conditions—the unionisation of the work force is important in that respect. As for the industry's safety record, members have rightly touched not just on the number of fatalities but on the number of injuries. Although, in my former life, I progressed accident claims of that kind, I would be delighted if better safety standards in these industries resulted in a much safer environment for people to work in.

We have to get this major economic opportunity for Glasgow right; it will happen only once in this generation and we will have only ourselves to blame if we miss it. Let us put all hands on deck and make it work.

Photo of David Davidson David Davidson Conservative 5:25 pm, 24th May 2000

I congratulate Johann Lamont on securing this debate, and I agree with many of her comments, particularly on training and safety issues. Scottish construction has always been a tremendously important sector of our industry, with major companies that have lasted for generations. At the moment, 130,000 people work for 43,000 firms, so there is a large network that requires support.

Although construction hardly ever rates a mention, and the industries that feed the sector are rarely considered, between them they provide many jobs in Scotland. From 1990 to 1996, the gross domestic product of Scottish construction rose by 10 per cent; however, because of technology, the numbers directly employed in the sector have fallen by 10 per cent. Imports from the rest of the UK total £1 billion and our exports total £550 million, which presents a huge opportunity for Scottish industry. However, it will need support and encouragement from the Executive to invest.

If we are to boost the number of sustainable jobs in construction, we will need to engage in essential work on the infrastructure to give the Scottish economy the proper basis for growth. I am pleased that, in the north-east of Scotland, it was announced today that Transco will build a pipeline which will provide 400 jobs, most of which will be local. We need more and more of those projects.

We must encourage road improvements and the construction of new strategic routes. Members will have heard me talking about the Aberdeen by-pass before now. However, we must also consider new railway links and the reconstruction of lines that have fallen into disrepair. Furthermore, if we are to continue to expand, we must improve harbour facilities. Such infrastructure work will provide employment, some of which will be very long term.

Reducing unemployment will release public funds, and various members have mentioned the need for the public and private sectors to be involved in partnerships. If we can create employment through the construction industry, we might be able to release funds to assist the public sector in participating more fully in such projects. As a result, I urge the Executive to assist people to get into major projects such as the Transco pipeline.

Today, craft working and working in building are not seen as sexy, and are not encouraged enough in schools or by society in general. However, the industry becomes more technical day by day and, as has already been mentioned, a huge skills gap is developing. The further education colleges that Robert Brown talked about should be encouraged to participate in filling that gap. In their drive to put bottoms on seats, to gain the funding that they need, they have failed to grasp the opportunity.

Some of the blame for that skills gap must fall on the Executive, unless the minister can give us some good news in his summing-up speech. For example, there is only one wood machinist course in Glasgow, and only one in Edinburgh. That is just not enough to support the industry and the opportunity that exists. Such courses are expensive to set up, and the funding comes, in the main, from the local enterprise company, but experience shows that the LECs tend to support IT rather than some of the basic skills that we need in building.

It is important that we also address the issue of housing, which has been mentioned. If we are to move on and support the industry and those who work in it, there must be full training and we must ensure the development of safety aspects in the industry. Scotland needs a modern infrastructure and housing fit for the new century.

Photo of Mike Watson Mike Watson Labour 5:30 pm, 24th May 2000

Johann Lamont has done the Parliament, Scotland and Glasgow a service in highlighting the issues in this debate, and I am glad to have the opportunity to speak. I will be brief.

Johann Lamont mentioned the construction industry's contribution to the economy, its significance in providing jobs, the safety issues that are involved and the role of the unions, all of which are important. I want to highlight one of the issues that is mentioned in the motion—training—as it is extremely important to ensure that the construction industry provides the skills base for our young people in Scotland.

Robert Brown referred to the Social Inclusion, Housing and Voluntary Sector Committee, which received evidence from the Union of Construction, Allied Trades and Technicians. Alan Ritchie attended one of our meetings and highlighted some of the concerns that are pertinent to the proposed housing stock transfer—not least in relation to the skills base of craftsmen and women in the work force. He cited an example that stuck in my mind.

A Scottish Homes direct labour organisation employed, on average, 100 apprentices a year. Following the sell-off to Mowlem Construction, however, no apprentices have been taken on by that company. That is a serious issue. The role that is allocated to direct labour organisations by Glasgow City Council—which guarantees 70 apprenticeships a year for boys and girls—is something that we want to protect, as are the unique training facilities at Queenslie.

The role of direct labour organisations in urban regeneration is important as well. As part of the new housing partnership, the Castlemilk Economic Development Agency is working to ensure that local labour clauses are inserted in the contracts of the contractors—currently Miller Homes. We have heard that those sorts of relationships cannot be formalised, but they can. One of those clauses states:

"It is an implicit condition of this contract that apprenticeships are offered to young people residing in the G45 postcode. The contractor is to select the applicants in association with Castlemilk Economic Development Agency and is to fully indenture them for the requisite period governed by Scottish Building Apprenticeship Scheme Rules and Regulations."

That is a clear example of Castlemilk Economic Development Agency working to secure employment and training for local young people. That action is not unique to the construction industry, and shows what can be done if the will exists.

In areas such as Castlemilk and Pollok, it is extremely important that the jobs go to local people. My example is taken from Glasgow, but the problem is Scotland-wide. Wherever the new housing partnerships and other construction projects are under way, I hope that companies are at least encouraged, if not forced, to ensure that, as far as possible, the jobs are allocated locally.

There is a caveat, however. If the skills base is not there, the jobs cannot be allocated locally. Robert Brown was right to highlight the fact that, if the housing stock transfer in Glasgow goes ahead, it will require many jobs over a number of years. The apprenticeships must begin now, to prepare for that and other construction projects in Glasgow.

Photo of Allan Wilson Allan Wilson Labour 5:33 pm, 24th May 2000

I will be brief. I thank Johann Lamont for lodging the motion. I identify myself with her comments on the failure of the private sector to invest in our young people.

Economic boom and bust traditionally manifests itself first in the construction industry. The period of bust that occurred a few years ago saw construction firms reducing or dispensing with not only apprenticeships, but time-served tradesmen.

There has been an absence of a proper apprenticeship scheme for a number of years and the result is that we have an aging skilled work force. Skills that should have been passed down to properly trained apprentices are passing into obscurity as tradesmen retire. I was interested to hear Kenny Gibson's example about the 16 slaters in Glasgow. That is the best example I have heard—16 trained slaters in Glasgow would constitute almost half the total in apprenticeships in Scotland. If an apprenticeship lasts four years, only between seven and nine people will qualify to replace retiring tradesmen in Scotland in any given year.

In Scotland, few national construction companies have apprenticeship policies and, left to their own devices, they would have no intention of introducing them. Management agents are now involved in most major new construction projects, including, I understand, the Parliament building. I have asked the Presiding Officer how many apprentices are employed or are likely to be employed on that project. I will be interested to hear the answer, because there would normally be few, if any, on projects on which management agents are being used.

Another vestige of the boom-and-bust period is the 714 certification that Robert Brown referred to. Many tradesmen of my acquaintance have to pay 26 per cent or more of their earnings, which is deducted at source, to pay their backlog of unpaid tax. Their situation is critical and demands Government intervention, or our ability to compete worldwide for major construction projects will diminish. Opportunities for productive and rewarding employment for a generation of young people will diminish as a consequence of that. I am concerned about that and I know that it concerns Johann Lamont and everybody else here.

I am also concerned about the disparity between the amounts spent by local enterprise companies on 18-plus apprenticeship training, which David Davidson referred to. I support the call in the motion that the Executive do everything in its power to address that.

Photo of Alasdair Morrison Alasdair Morrison Labour 5:36 pm, 24th May 2000

I thank members for their speeches and join them in congratulating Johann Lamont on securing the debate and raising a number of issues relating to employment and training opportunities in the construction industry, especially in Glasgow.

The construction industry is undoubtedly doing well. Scottish construction industry output grew by 2.6 per cent in 1999, which is very good news after a number of lean years. However, that growth was broadly the same as the growth in the Scottish economy as a whole last year. The figures do not suggest a boom, but steady and welcome growth.

Recent business survey evidence from the Scottish chambers of commerce is also encouraging, but it too does not point to a construction boom. In fact, a boom is not necessarily what we want. Longer-term prosperity and job security in the industry will be better served by a measured approach to investment.

Having sounded that note of caution, I can say that the transfer of Glasgow's council housing into community ownership has major significance for the city. Robert Brown highlighted the fact that the transfer offers empowerment to local communities throughout Glasgow. The transfer will offer investment of £1.6 billion—one tenth of the Scottish Parliament's entire annual budget—in the city's housing within 10 years. It therefore offers the prospect of new opportunities for employment and training in the city.

It is estimated that more than 3,000 new jobs will be created by the investment: about 1,700 of them in the construction industry and another 1,400 with associated suppliers. The challenge to us all is to ensure that the people of Glasgow—in Pollok and elsewhere—benefit from the creation of good quality jobs in the construction industry. That point was made ably by many colleagues.

We know that disadvantaged young people and long-term unemployed adults in Glasgow have great difficulty getting into the new jobs that are being created by a number of sectors in Glasgow. I noted carefully what Johann Lamont said about the city council and the important issue of pre-vocational training. As members will recall, the Beattie committee report that was published in September 1999 made a number of recommendations about the expansion of pre-vocational training. The setting up of an action group was announced earlier this month and there should be an action plan on that issue shortly.

The Scottish Executive funds and supports Scottish Enterprise and other public agencies to tackle these problems through a range of programmes, including Glasgow works, skillseekers, training for work and the Glasgow employment zone. I have highlighted those initiatives, but we all accept that more needs to be done.

Glasgow City Council and Scottish Enterprise Glasgow are now working closely together to ensure that the opportunities arising from the housing transfer make a difference to Glasgow's employment problems. Glasgow City Council is committed to the provision of 1,000 construction-based accredited training places in the current financial year. Johann Lamont was right to highlight the council's pioneering work in that important area.

Planning is already under way through Glasgow City Council, Scottish Enterprise Glasgow, the Scottish colleges of further education, the new deal programme, the European social fund, the Construction Industry Training Board and private sector construction companies to co-ordinate training programmes with the proposed housing improvement works programme to identify skill requirements and to align training activity and funding with any identified skills shortages. Those points were highlighted by Kenny Gibson, among others.

The Executive has given an additional £300 million to the modern apprenticeship programme. In 2000-01, the Wise Group will provide work and training opportunities to 750 long-term unemployed Glasgow residents. A majority of those people will work on housing-related activities such as energy conservation, safety and security and landscaping.

Members have singled out the training needs of young men and women. The Executive places great importance on increasing the level of skills and qualifications among young people. This year the youth training budget will be £87.5 million. We place particular emphasis on increasing the number of young people in modern apprenticeships, which support young people training at craft and technician level.

The construction industry currently has nearly 4,000 modern apprentices in training, with 1,800 entrants in the current year. I am also pleased to note that Scottish Enterprise Glasgow is now having greater success in recruiting young people from Johann Lamont's constituency, from Easterhouse and from other deprived areas into the wider skillseekers programme and into modern apprenticeships. I have no doubt that, with the council and other partners, it will seek to increase the number of opportunities for those young people among the projected new jobs.

Finally, I come to the important issue of safety, on which members were right to dwell. The Executive supports the construction industry's initiatives to work towards improved safety and regulatory standards. I am pleased to say that our construction industry in Scotland has been active in that area for some time. That is encouraging.

The Scottish Construction Operatives Register Executive—shortened to SCORE—was launched by the Scottish industry in 1995 to maintain a register of construction operatives who have achieved agreed standards of training. Those standards include tuition in practical safety awareness and are intended to encourage operatives to think about possible risks in the construction environment. Sadly, we know that it is a dangerous and hazardous environment.

The standards of training in safety and other areas required by SCORE are significantly higher than those specified by the construction skills certification scheme, which is intended to be UK-wide but now finds favour mainly south of the border. In an important development, the construction skills certification scheme has recently been extended to include a short computer-based multiple-choice test of knowledge of health and safety issues. It can be carried out at many centres throughout the United Kingdom and is designed to show up areas of weakness in operatives' knowledge of the relevant safety regulations to help identify training needs. SCORE complements that scheme with a more pragmatic approach.

The construction industry in Scotland clearly understands the need to improve regulation and safety issues. The industry deserves our support and encouragement in its efforts to deal with the problem and in applying a sound practical approach. The construction industry is well placed to take advantage of the new opportunities in Glasgow, and the Executive will work with all the agencies in Glasgow to ensure maximum benefit to the city's residents.

Meeting closed at 17:43.