Scotland’s Private Rented Sector (PRS) Champion Gerry More has broadly welcomed the further clarity given by today’s publication of the Private Housing (Tenancies) Bill but emphasised the importance of balancing the needs of tenants, landlords and investors if the Scottish Government is to achieve its objective of significantly expanding capacity in this fast growing sector. Having been tasked with attracting long-term institutional investment to enable the development of professionally managed purpose-built private rented housing at scale, Mr More said: “There is much to be welcomed in today’s announcement on updating the tenancy regime with initial rents continuing to be market-led. “However, we now need to work through the detail, particularly in relation to the use of rental caps and how student tenancies are ended, in order to ensure Scotland remains competitive relative to other countries. “The Scottish Government is working with the sector on a cohesive range of measures including exploring the development of a rental income guarantee mechanism and the Chief Planner has also this week sent a letter to Local Authority heads of planning encouraging them to consider the role new build PRS homes can play in meeting housing need and demand in their areas. “Scotland needs a modernised system which helps increase the supply of much needed housing. I therefore look forward to continuing positive discussions with the Scottish Government on how this can be achieved.”

G4S Facilities Management, the FM business of global security company G4S, has appointed Peter Jones as its managing director for UK, Ireland, the Channel Islands, and the Isle of Man. Jones, who joins the company on 8 October, will be responsible for leading the FM business that employs more than 7,200 staff across these regions. G4S FM delivers integrated facilities management, security, front of house, hard FM, cleaning, catering and service desk services in the corporate, healthcare, education and central government sectors. He has more than 23 years’ experience in the property, FM and engineering sector at national and international level, and was most recently MD of CBRE’s integrated facilities management business across EMEA. Before that he held several leadership roles in his eight years at Carillion, with responsibilities including infrastructure services, property services and FM. In his earlier career, Jones worked for Barclays Bank, where he led the FM strategy, and at Johnson Controls, delivering FM across EMEA. He has expertise in business leadership, market growth and acquisition, client relationship management, major outsourcing and real estate and facilities change. Jones said: “At G4S I will have the opportunity to grow our FM business in the UK and Ireland, and help to develop our overall FM offering in other key markets, as clients are increasingly looking for us to provide additional integrated solutions. “With security and FM services accounting for 59 per cent of group revenue globally, G4S has an unrivalled platform to respond to our customers’ increasingly complex requirements.” G4S regional president, UK & Ireland, Peter Neden, added: “I would like to welcome Peter to G4S. The FM business has been identified as one of the key growth opportunities, both within the UK and the broader G4S Group.” –

Much has been made of the Conservative government’s attempt to take advantage of the enfeebled state of the Labour opposition by moving to plant its flag in the centre ground of British politics. And no policy embodies this more than the introduction of a ‘living wage’. The summer Budget saw George Osborne introduce plans to ramp up the minimum wage for over-25s to a living wage with the first increase from the current £6.70 to £7.20 an hour in April, planned to be a staging post on the way to £9 an hour by the end of this Parliament in 2020. There are many reasons for doing this, partly to improve the lot of the worst-paid, but also to make working more attractive to those whose benefits are being squeezed. But for businesses whose operations are labour-intensive, the living wage threatens to pose significant challenges. Some argue that it will create more loyal workforces and reduce turnover of staff, but it will also pose challenges to profit margins as wage bills look set to soar. Indeed, business groups such as the Confederation of British Industry have described the move as a ‘gamble’ that could harm the UK employment market with those offering care services in particular likely to have to pass on costs to government clients. And recruitment company Manpower waded into the debate earlier this month by saying the move was likely to hamper job creation. With a 7.5 per cent wage rise for those on the lowest wages baked in for 2015, companies are going to have to look hard at areas of their businesses where they can make commensurate savings, or look to pass on the additional cost to their own customers. Interserve reckons it will see its wage bill rise by between £10 million and £15 million next year – the news sent its shares tumbling recently. The company reckons 10,000 of the 15,000 it employs in the UK will see their wages leap, and margins will suffer as a result. Mears Group estimates its extra costs at £5 million, or 10 per cent of profits. The problem for many FM firms is that such is the rivalry in the sector they could struggle to pass on such costs to customers and will have to take a margin hit. Outside the FM sector, Whitbread, which runs coffee shops, hotels and restaurants, also admitted it will take a significant hit from the living wage – but it vowed to pass on costs to customers. Retailer Next devoted a significant portion of its results to discussing the effect that the living wage could have on its business and margins. With the dual effect of wages rising sharply ahead of the prevailing rate of inflation and prices also potentially rising to cover such costs, the government’s initiative could have the effect of reawakening inflation. Coupled with the fact that commodity prices, oil in particular, cannot stay this low, we could see inflation creeping back, which may allow FMs with inflation-linked contracts to recoup some of the extra costs. It could also pave the way for the Bank of England to set in train interest rate ‘normalisation’, although what that really means now after six years of near-zero interest rates is difficult to quantify. Essentially, while the living wage is to be welcomed, it will bring big challenges for the FM sector for several years to come.