Thursday 20 November 2014

BWF calls for decisive action by Chancellor

Joinery manufacturing and woodworking firms across the UK are calling on the Chancellor to do more to meet the housing shortfall, to recognise the value of apprenticeships and to reform business rates to avoid penalising manufacturers.

In the British Woodworking Federation’s (BWF) latest submission to the Chancellor of the Exchequer George Osborne in advance of the Autumn Statement on 3 December, the BWF chief executive Iain McIlwee has outlined the industry’s requests, born from concerns that the economic recovery may yet fizzle out for more than 5,000 firms operating at the heart of the UK’s construction sector.

The BWF’s letter focuses on a number of objectives such as encouraging investment, tackling the skills gap, delivering the UK from housing crisis and reducing the squeeze on businesses. The BWF has also expressed its recommendations to shadow construction minister Iain Wright MP and business secretary Vince Cable MP.

Iain McIlwee said: 
“Our latest State of Trade survey indicates that joinery workshops are becoming busier. Two thirds of our survey respondents report they saw an increase in sales in the summer, and more than half said they are operating at over 80% capacity for the first time since the end of 2012. This is welcome news, but economic concerns remain, material costs are high, and margins are thin.

“This year’s Autumn Statement should be about much more than popularity, pints and petrol. Our members are rebuilding in uncertain times and we need policies that encourage much needed investment in plant, machinery and a skilled workforce.”
The housing market remains central to the fortunes of the UK joinery industry, explained Iain McIlwee: 
“The BWF has been at meetings with MPs and policy makers from all parties, including the communities minister Stephen Williams and shadow housing minister Emma Reynolds. What has become really clear from these meetings is that building more homes is a critical part of all election strategies. Increases of a third are being mentioned and even the prospect of doubling the current build rate is beginning to be touted.

“But given that we’re still unlikely to get much beyond 150,000 new home starts this year, these proposed levels of housebuilding are a tall order without fundamental change. Housing is key to our industry’s growth, so we want to see a renewed focus on incentives for custom and self-build, as well as action to release sites from local authorities and greater investment from affordable housing providers to help meet the likely shortfall.

“We also want action taken to acknowledge the importance of timber products of all types within the Government’s environmental targets for homes. Otherwise, low embodied carbon, a fundamental strength of timber and a crucial asset when addressing the amount of energy spent making new buildings, is at risk of being overlooked. What is critical is that we don't just build houses, but high quality, sustainable homes. This is where joinery firms come in. With impeccable green credentials and significant opportunities for driving efficiencies – both on and off site – their products have a huge role to play.”

Additional points made in the BWF’s submission include:

  • The BWF applauds efforts from both the Construction Leadership Council and Government in highlighting deep rooted payment issues through initiatives such as the Construction Supply Chain Payment Charter and its 11 ‘fair payment commitments’, but is calling on more companies to sign up to and meet the Charter payment commitments or sanctions must be applied.

  • To improve confidence, R&D Tax Credits should be extended to £500,000 until the end of 2015 with fuel duties cut with immediate effect.

  • Government must look at ways of removing manufacturing plant and machinery from business rate assessments to encourage investment.

  • A belt and braces review of the Green Deal is desperately needed and should encourage new activity in the home improvement, repair and maintenance market.

  • The Allowable Solutions framework should be used to help cut carbon emissions by addressing the 30-50% of a building’s lifetime emissions that are accounted for even before the building is occupied.

The BWF has also raised concerns that recent proposals on apprenticeships could drive up costs and increase the bureaucratic burden on many SMEs in the industry. Iain McIlwee said: 
“The chairman of the Woodworking Industry Training (WIT) Forum, the training arm of the BWF, recently addressed the Apprenticeship Commission. Our sector has a proud heritage of being apprentice-led, and we boast the highest ratio of apprentices in the specialist construction sector. In recent months there has been significant work undertaken to evolve the architectural joinery qualification and to reintroduce a woodworking apprenticeship.

“However, the changes derived from the Richards Review, together with recent announcements from Vince Cable on intentions to hike up the national minimum wage for apprentices, are likely to be counterproductive. We want the Chancellor to look again at the options available so that this industry can hire more apprentices, not fewer.”
Read the full letter to the Chancellor at the BWF website:
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