Property managers should not be subject to more formal regulations by the government but there needs to be more transparency and communication in the leasehold market, it is claimed. The Competition and Markets Authority (CMA) has, however, made a number of recommendations as a result of its market study into the residential property management services sector in England and Wales. It had consulted extensively with consumer groups, leaseholders, the industry and government during the course of the study and found that overall while the market works well for many leaseholders, some have experienced significant problems in a sector where total annual service charges are estimated at £2.5 to £3.5 billion. The issues identified include leaseholder frustration at a lack of control over the appointment of property managers, high charges for services arranged by property managers or poor standards of service. It also found leaseholders suffered unexpected costs and were being charged for works they consider unnecessary, poor communication and transparency between property managers and leaseholders, and difficulties in getting redress. The CMA has also identified some concerns about prospective purchasers’ understanding of leasehold, and their obligations and service charge liabilities for leasehold flats. In light of its findings and on-going developments in the market, the CMA has made a number of detailed recommendations aimed at improving prospective purchasers’ awareness of leaseholders’ obligations. It also wants to improve disclosure, transparency and communication between property managers and leaseholders and leaseholders’ access to appropriate forms of redress. It says that these recommendations will make leaseholders better informed about the responsibilities and performance of property managers, while greater transparency will increase pressures on property managers and landlords to take account of leaseholder interests. They will also provide improved mechanisms for dispute resolution, should issues arise that require action. The CMA is also recommending changes to legislation affecting rights of consultation relating to major works, as well as supplementing the existing Right to Manage legislation to enable leaseholders, where there is a majority in favour, to require the landlord to re-tender the property management of their block. The CMA is not recommending that property managers should be subject to more formal regulation by government. It says that for many the market works reasonably well, and satisfaction levels are particularly high where leaseholders have exercised their Right to Manage. It adds that existing legislation provides significant protections for many leaseholders, and the sector has engaged constructively with the CMA during the course of its study, recognising that there are improvements to be made and showing a willingness to address the issues that have been identified. ‘Many property managers provide a good service to leaseholders, but protection against the worst failures by property managers is vital because when problems do occur they have a major impact on leaseholders,’ said Rachel Merelie, the senior director at the CMA who led the study. ‘We are pleased that within the sector there is a consensus that change is needed and a genuine willingness to be part of that change. This is evidenced by the new and revised self-regulatory codes of practice and the enthusiasm of key players, including property managers, to improve how this market functions,’ she explained. ‘The CMA intends to work with the sector and government to implement its recommendations. However, should these not prove to be effective in addressing the issues identified, the CMA may choose to re-examine the market in due course,’ she concluded.

Exclusive: Developers of gas-fired plant that could power 2.2 million homes admit project is behind schedule and yet to secure investors The Government’s plans to keep the lights on have suffered a fresh setback after it emerged the only new large gas power station due to be built in coming years is now in doubt. Energy firm Carlton Power was awarded a subsidy contract by the Department of Energy and Climate Change last year to build a new 1.9 gigawatt plant at Trafford in Greater Manchester – big enough to supply power to 2.2 million homes. The £800 million plant was due to start generating in October 2018, but Carlton Power told the Telegraph it could no longer meet that date – and had so far failed to secure financial backers for the project to go ahead at all. Mike Benson, Carlton Power’s business development director, said securing investment had proved “more difficult than we would have hoped” due to a combination of long-term policy decisions that had skewed the market, and uncertainty caused by recent cuts to wind and solar subsidies. The Trafford plant had been supposed to begin construction this summer after getting a subsidy contract through the Government’s ‘capacity market’. The scheme is designed to ensure there will be enough power plants to keep the lights on by paying their owners to guarantee they will be available. arlton Power signed up to build the Trafford plant in return for subsidies of more than £30 million each year for 15 years. On top of the ‘retainer’-style payment, it would then get revenues from selling electricity into the wholesale market. Mr Benson said long-term political intervention through “continuing direct subsidies for low carbon technologies such as wind, nuclear and solar” skewed the wholesale power market, making the price artificially low and making it harder to invest in gas plants. “Despite the widespread acceptance of the need for new gas fired generation, there is no market signal to support that investment,” he said. He added: “The recent changes in government support for renewables is an issue that concerns the investors we are talking to, as this demonstrates an increase in political intervention and uncertainty over the long term structure of the UK market.” If Carlton Power fails to secure investment for the Trafford plant by next summer its subsidy contract will lapse and it will face an £8 million penalty. Ministers would then be left to make up any shortfall in electricity supplies for 2018 by offering subsidies to other plants, such as old mothballed coal or gas plants, or diesel generators.  

Heathrow Airports Holdings Ltd has begun the tendering process for work on its £17.6bn third runway, despite the government having not yet given the project the green light. The airport has called for expressions of interest from firms in four areas of work ahead of main construction getting under way. These are programme management, information management, construction advice, and design and technical advice. Interested firms have until Friday (16 October) to respond, after which Heathrow will compile a shortlist and invite these companies to tender in November. A decision on preferred bidders is expected to be made in the early part of 2016. The news comes a week after transport secretary Patrick McLoughlin announced that the government would make a decision on Heathrow expansion before the end of the year. Speaking at the Conservative Party conference in Manchester last week, Mr McLoughlin said: “People have strong views, rightly, but Sir Howard Davies’ commission has produced a powerful report. And we will respond by the end of the year.” Be in the room with McLoughlin The transport secretary will be among the speakers at this year’s Construction News Summit on 3-4 Nov – book now to get in the room with leading infrastructure figures. In July, the Airports Commission recommended Heathrow ahead of Gatwick as the preferred location for airport expansion in the South-east. The decision was met with strong opposition from some politicians as well as Gatwick Airport, which has questioned Sir Howard’s recommendation on the grounds of air pollution and “complexities in construction” not being fully considered. It is understood that the decision to begin tendering early has been taken so that Heathrow’s supply chain is ready to begin work as soon as a decision is made by the government. In July, Heathrow chief executive John Holland-Kaye announced that the airport would begin tendering for work in December. Speaking at a London First event on airport expansion, Mr Holland-Kaye said: “From the supply chain point of view, we will have a conference in September to outline our plans to the industry and we will be going out to tender probably December or January to get the supply chain ready.” He added: “We need an early decision from the government and an early vote in parliament to cement that decision.” Currently, Heathrow is aiming to have spades in the ground by 2020 with a completion set for 2025.

Construction unions have claimed victory in their long-running industrial dispute at the Sellafield nuclear plant after subcontractors agreed to install a full-time health and safety convener on the site. The deal was secured after meetings between union officials and the 14-strong group of Sellafield subcontractors earlier this week, with the unions now confirming a “full withdrawal of all industrial action”. The new convener will investigate workers’ welfare and health and safety issues, as well as acting as a link between the unions and subcontractors. The deal will also see the formation of a health and safety committee spanning all Sellafield subcontractors. The subcontractors include Cape Industrial Services, Focus Scaffolding, Hertel UK, Interserve Industrial Services, Jacobs Stobbarts, Meldrum, Mitie Facilities Services and PPS Electrical. Amec Foster Wheeler, Balfour Beatty Engineering Construction Services, Doosan Babcock, Nuvia, MW Hargreaves and PC Richardson & Co make up the remaining subcontractors. The agreement comes after nearly six months of action by union members who had raised health and safety concerns. This has led to more than 16,000 hours of work being lost at the site. On 5 August, more than 1,200 workers stopped working for two-and-a-half hours in protest at the absence of a full-time convener. This was followed by a second strike on the 19 August, which saw more than 1,000 workers walk out for two-and-a-half hours. Four more strikes followed in September, including a 24-hour walkout on 23 September. A work-to-rule and overtime ban was also put in place by the unions on 31 July. Unite senior shop steward at Sellafield Ryan Armstrong says: “Common sense has prevailed, unions are there to help and support their workers and this news means the workers have a voice now. “Now that we have an individual and group that will be investigating any problems with health and safety and workers’ welfare, it means we have a channel now to the subcontractors’ representatives. “We have achieved the two main things we were going for and this can only help the site going forward – it will nip problems in the bud at source.” Unite regional secretary for the North-west Mick Whitley said: “A healthy workplace is a more productive workplace. “The creation of a new senior shop steward on maximum facility time at Sellafield will help make the site safer, reduce accidents and enable workforce issues to be dealt with speedily.” A Sellafield Ltd spokeswoman explained “We welcome the fact that the contracting companies and their employees involved in this dispute have reached an agreement, and can now focus on delivering progress at the site. “Sellafield Ltd and our employees are not directly involved in the dispute, which is in no way related to the safety of the Sellafield site. The dispute concerned the nature of union representation for the contractor community.” The NAECI Sellafield contractor group would not comment on the news.

The UK’s leading vacant property and security specialist, VPS and their sister company VPS Site Security, have uniquely been shortlisted in two categories this year for Security Excellence honours, following on from their selection for the British Construction Industry Awards. “We’re delighted to have won through to the SecurityEx finals twice over.” Says Anthony Owen, Managing Director of VPS. “VPS Site Security is shortlisted for Security Project of the Year, for its innovative design combining the latest technologies with mobile patrols to protect a Costain highways construction project in South Wales.” “VPS itself is in the Large Security Installer category, with an entry that included securing 51 CityLink depots stretching from Aberdeen to Southampton, all on New Year’s Eve. I’m very proud that our staff’s expertise and hard work continues to gain recognition, and ensures VPS remains the leader in the field by a country mile. No other specialist in our sector has been shortlisted once, let alone twice.” In their seventeenth year, the Security Excellence Awards have consistently broken new ground in highlighting the very best people, projects and processes the UK’s security sector has to offer. The high calibre Judging Panel – including representatives from all areas of security & fire, the world of academia and the policing sector – will determine this year’s Winners, who will be announced at the Awards ceremony at the London Hilton on Park Lane on November 25th. Last week, VPS Site Security issued a case study on the £150 million Costain construction site along 14 kilometres of highway. The ‘Heads of Valleys’ road in South Wales is undergoing major improvements. It presents significant engineering and environmental challenges for safe traffic management and the protection of equipment. VPS Site Security developed an innovative connectivity network, using wireless fluid-mesh communications linking 18 of its award-winning JCB Smart Towers®, supported by a mobile monitoring station. It provides not only early alerts to traffic flow problems – allowing any vehicle breakdown to be responded to immediately – but also protects the materials and equipment along the site. Last New Year’s Eve, administrators Ernst and Young (EY) called VPS after a major parcel courier company collapsed, leaving unprotected 1.6 million square feet of space, over 30,000 undelivered parcels and 51 depots around the UK. VPS secured and alarmed the City Link depots within 24 hours of receiving the instruction from EY. Earlier this year, VPS Site Security was also shortlisted for the British Construction Industry Awards for product Innovation for the Building sector.

The Water Industry Commission for Scotland (Wics) has raised concerns over delays in Scottish Water’s investment programme in its five year regulatory period report. The regulator said that delays in implementing improvements to water treatment works and wastewater discharges have resulted in delays to customer and environmental benefits. Some of these delays have been as a result of Scottish Water assessing the scope for efficiency savings, although Wics adds other issues arose around design and delivery. However, Scottish Water has acknowledged the delays and has provided assurance that the remaining projects will be delivered as soon as possible and that measures have been put in place to improve asset management mechanisms for 2015-21. The Wics report does highlight that Scottish Water has invested £2.5 billion since 2010 in maintaining its assets, with £1 billion of that going on improving water quality. This has helped create the “significant improvement” in both drinking water quality standards – up from 98.43 per cent in 2009/10 up to 99.74 per cent in 2014/15 – and wastewater pollution incidents – down from 804 in 2009/10 to 249 in 2014/15. Over the 2014/15 regulatory period, Scottish Water also recorded £122 million of outperformance, which resulted in household bills being kept 5 per cent lower than previously expected. Wics chief executive Alan Sutherland said: “Scottish Water’s performance is encouraging and suggests that the clear incentive framework that is in place to regulate the public sector water industry has served the interests of customers well. “However, this does not mean that we can be complacent, and we must continue to ensure that the industry is properly equipped to meet the challenges that lie ahead.” Scottish water chief executive Douglas Millican the performance over the last five years represented a “major step forward” for the company, but he admitted “we cannot afford to be complacent”. He said there is a “constant drive” for the company to deliver further improvements to drinking water quality, customer service, and environmental performance.

The Open Water programme moved into the next phase as CGI was awarded a five year, £15 million contract to design, build and operate the central IT system for the English water market. The company will build the central IT infrastructure by adapting a system that has been used in the Dutch and Danish electricity markets for use in the non-domestic water market in England, which opens in April 2017. CGI has formed a strategic partnership with Bridgeall, which was involved in the opening of the market in Scotland, to develop the billing system that will calculate usage charges and allocate them to the relevant wholesalers and retailers. The design phase of the central IT system is due to be completed in November this year, with a functioning system built by April 2016, ahead of testing and shadow operation later that year. MOSL chief executive Ben Jeffs said: “Introducing competition in England by April 2017 is a major challenge, both in terms of timescales and complexity. “The central market operating system will be at the heart of the new market, so we are delighted to appoint such an experienced team to work alongside us in this critical role.” CGI vice president for energy and utilities in the UK Tara McGeehan added: “We have a very tight timescale to design, build and implement the system, but by working in partnership with all the key stakeholders and leveraging our central market systems experience, we will develop a system that will make competition work for the water industry.” MOSL, which currently has 26 water companies in the UK as members, is working with Defra and Ofwat to deliver the Open Water programme that aims to offer 1.4 million businesses, charities and other organisations in England a choice of water retailer for the first time from April 2017.