‘The construction sector in the UK does not speak with one voice, and fails to lobby effectively in the run up to both the Budget and the Autumn Statement.’ This was said in confidence by a senior HM Treasury official to me and others this week.
The construction sector is responsible for 8% of UK GDP and employment. Yet too often we see housebuilders pitched against product manufacturers (eg expensive window frames), architects pitched against housebuilders (eg poor design standards), clients pitched against architects (eg low collaboration skills), and product manufacturers pitched against clients (eg inability to plan orders beyond next week). Not a happy circle. I exaggerate, but not so much.

A Lobby Is Needed
There is clearly a major political battle underway within the UK government leading up to the Budget on 20 March on whether to restore or even increase public sector capital budgets for economic and social infrastructure (eg flood defences, social housing) which would be funded by extra borrowing through government bonds.
Whatever the reasons are for the reported failure of the construction sector to lobby effectively so far, it is not due in my view to any shortage of the various national construction bodies, boards, councils, associations and suchlike.
But frankly speaking, maybe some big and prickly egos have to just stand together now and speak with one voice for the greater good.

The writer of this book is a practising psychologist, and I found his reflections on the various recent ‘popular myths’ in the busy world of self-help and personal development to be a breath of fresh air.
It may seem a paradox: a paperback on psychology having a pop at all the other popular paperbacks on self-development. But bear with him, as I think he has a very healthy and grounded approach to life. He reminds us of the need for compassion, forgiveness and mindfulness when some of the strident writers are just piling on the pressure.
Each fashionable myth is covered in a short chapter, 23 in all, covering all the current pressures, from “whatever the problem, CBT is the answer” to NLP’s “there is no failure, only feedback”, to “think positive and be a winner”.
Clearly there is hunger for self-development and spiritual growth, and this book I find is a useful antidote to some of the quick-fix books which actually can make matters worse. Reference:
Psychobabble: exploring the myths of the self-help generation. Dr Stephen Briers (2012) Pearson Education Ltd.

The built environment is causing one-third of the problem in climate change. There is a plan to reduce this figure, and this is summarised today (5 March) by a report by the Green Construction Board showing how the built environment needs to do far more than it is currently if the UK as a whole can hope to meet the target of 80% less carbon emissions by 2050.

The report is called a Low Carbon ‘Routemap’ for the Built Environment. In short, they conclude that,

“It is technically possible to deliver the government’s target of an 80% reduction in carbon emissions in the built environment [by 2050] … however, this would require maximum uptake of technically viable solutions in all sectors, including implementation of technologies that at present do not have a financial return on investment over their lifetime. Delivering this [outcome] is dependent on improving the economic viability of technical solutions and addressing market failures.” (p84, emphasis added)

The report also assumes a ‘slow but steady’ decline in emissions from now to 2050, however many critics now say that ‘urgent and large’ drops in emissions are needed soon if there is any chance to avoid a 4C average global warming this century.

The energy used by people within buildings, at home, work and play, accounts for 36% of all the UK’s carbon emissions. It is more than transport, and is more than the amount used by industry. Most of the energy is used for heating buildings, then hot water, then lighting, and finally for cooling and ventilation. The exception is found in shops, where more energy is used for lighting than for heating.

Details:

The development of the Routemap was managed by WRAP, with Arup and the Climate Centre to provide technical support. Their analysis shows the UK Built Environment was responsible for almost 210 MtCO2e of emissions in 1990 and just over 190 MtCO2e in 2010. One MtCO2e is one mega or million tonnes of carbon dioxide equivalent. The “e” at the end means that other greenhouse gases (such as methane) are included with their equivalent greenhouse strength. One tonne of methane gas released into the atmosphere, for example, is as bad as roughly 40 tonnes of CO2 emissions.

Link to GCS Resources page:

http://www.greenconstructionboard.org/index.php/resources/routemap

Link to Routemap report (77 Pages):

http://www.greenconstructionboard.org/otherdocs/Routemap%20final%20report%2005032013.pdf

“Governments talk, cities act” said New York Mayor Michael Bloomberg, quoted with approval by Sir Richard Leese, Leader, Manchester City Council yesterday at the MACF event yesterday.

MACF is Manchester: A Certain Future and brings together an effective change-based partnership of people from a mix of politics, business, community, arts, education, faith and public bodies to develop and enact changes within Manchester that will urgently push down the city’s CO2 emissions.

The event yesterday was a stock-take on progress since 2009 and workshops to explore the “next big things” that the city can achieve together.

One area where the city does need to make further progress, and quickly, is in reducing the energy use of our commercial buildings. In the discussions it was noted that the energy costs are a small fraction of occupation costs, especially in the city centre where rent plus all charges may be up to £50 per square foot, whereas the energy costs may be less than £2 of this.

The downside is that it is sometimes hard to make a financial case on such a small margin, was the feeling of the key property people present.

However, a possible upside is that the risks of financial loss are therefore also small. If this was a costed PR project rather than a costed energy-saving project, the cost/benefits would be highly attractive when compared with other PR options.

The trick could well be to obtain the PR return on investment as a result, and one approach here is to have a DEC – display energy certificate – in the lobby or even better in the front window, to show competitors and attract responsible customers.

Having good evidence is key to making city-change work to its best effect. New York Mayor Michael Bloomberg has also said that, “On the US dollar note it says ‘In God we trust’, however everybody else has to bring data.”

This week has seen four of the UK’s major housebuilding companies publish their annual reports and accounts. One has just been sold to a USA hedge fund. The business press has been kind to the companies, mostly because they have returned to profit and can pay a dividend again.
But at a price. 2012 was the third-lowest year for building new houses in the UK since 1947. All the companies have massively scaled back their volume of work in the UK, though some are still strong in the Arab states. Mostly the companies have shed many staff, are now building mainly small numbers of higher-value properties and then only south of Cambridge. To remain profitable the companies have had to become smaller niche builders.
This is bad news for the UK economy and for growing families. If this collapse continues we risk housebuilding going the same way as the manufacturing sector – local decline followed by growing imports.
To date the idea of importing new houses has seemed too daft to seriously consider. However, with modern methods of construction including 2D panels and 3D modules made by offsite manufacturing, as is already commonplace in Germany and elsewhere, it will only seem a daft business idea until the new profits start to roll in. Singapore could well become the UK’s volume housebuilder.

Following the 2008 crisis in banking and finance, one of the solutions taken was to separate out the toxic assets such as sub-prime mortgages and place them in a new ‘bad’ bank, leaving the existing banks cleansed and able to continue functioning.
The UK housing market is in failure, not least because it is over-valued. So, similar to the banking sector, maybe the housing market should be split into two markets. The first market would be for the over-valued homes which are not selling and will continue to slowly reduce in seller asking prices until the market starts to function properly again. The second market would include new building for rent and purchase at affordable levels, and it would function straight away. The risk is that this second affordable market would overheat because of the first over-valued market, because of the potential for hoarding and for intoxification.
Intoxification, and its super-profits, can be dampened by taxation. For example, any affordable home sold for more than three-times average earnings could have the excess charged as capital gains tax or repaid through covenants. Hoarding is harder to counteract. In the housing market there are laws which deal with hoarding, such as compulsory purchase and indirectly planning permission, but these are not straight-forward to apply. An extra rate (such as Council Tax) on hoarding empty buildings or land is easier to apply on a large scale.
The politics of ‘the art of the possible’ means that canvassing candidates don’t want to knock on doors asking for someone’s vote and then say, ‘of course, you know this house is only worth £160,000’. But when the number of voters excluded from the housing market starts to match or exceed the number currently included, then tenants rights and affordable housing become big enough vote winners to provide a platform for gainning power.
The ‘bad’, over-valued, detox market will then be in effect ring-fenced, slowly correcting itself over the years as more sellers slowly adjust their prices back towards more affordable levels. The danger is of waiting too long so that a future rise in interest rates will precipitate a further crisis in what is still an over-valued and over-mortgaged housing market.

Steve Lewis, the CEO of Living PlanIT, says that over 50% of global wealth is based in just 25 cities. Is this growing level of inequality sustainable, and if not, can we change it?
Political theorists like Ralph Miliband have observed that the essential driver within capitalism is that of Capital Accummulation. This driver creates the instability: the relentless growing bubble, the collapse, and then the next cycle starts. Karl Marx was an optimist when he said these cycles would eventually end with a paradigm shift (revolution) of fairness for everyone. A pessimist might wonder if instead there is no end to these cycles, no revolution, just repeated cycles of unstable accummulation.
In which case, will it be that the richest cities just keep getting even richer still, while the rest of the urbanised world gets left behind?
The answer to relentless Capital Accummulation is usually in the regulations, laws and taxes that chip away and partially constrain this growing capital, for example through anti-monopoly laws. But how could we regulate the growth of the richest cities, other than by pricing people out of these cities? Most capital controls are place-blind, and price pressures without regulation lead to issues such as overcrowding and slum housing. One alternative approach is being tried in China, where citizens who are authorised to live in a city receive additional civil rights when compared with workers who have migrated without authorisation from rural areas to find work. Whether this dual approach will rebalance the different growth rates of various Chinese cities remains to be seen, and at what personal costs.
And even if price pressures do become strong enough in Western cities to eventually limit the remorseless growth of the richest of the cities, it will be key workers in sectors such as mass transit / public transport, health care, education, security, that will be having to survuve under the most pressure, adding to the unsustainability of these elite cities.
Previously, one of the methods which acted as a safety valve was mass emigration such as that from Europe to the ‘new world’. However, with over six billion people living on the planet now, there are no more new worlds out there to take the strain. We have still to learn how One Planet Living will pan out for us, and this must surely include our learning how best to regulate the richest of the world’s cities for all our sakes.

Link:
What if … you could design a city? Jane Wakefield, BBC technology reporter. http://m.bbc.co.uk/news/technology-21032725

An American blog has an interesting discussion on urban trees. The writer generally applauds the compilation of the list of the top ten cities for urban trees, including New York and Seattle. However, they query the criteria used and suggest the additional items of the minimum soil volume allowed and the shape of the roots container.
Some cities apparently still allow 5′ x 5′ (1.5m x 1.5m) box cells, and not larger cells and trenches etc, and the lower standards limit the range and development of tree types.
Urban trees offer a range of benefits including shading, air cooling via water transpiration, noise reduction, air quality improvements; as well as aesthetic and wellbeing benefits. A good Green Infrastructure policy for a town or city will give strong support for urban tree cover. Link:
sustainablecitiescollective.com/node/125471?utm_source=feedburner&utm_medium=twitter&utm_campaign=Feed%3A+SustainableCitiesCollective-TwitterHandleFeed+%28Sustainable+Cities+Collective+-+Twitter+Handle+Feed%29

Writing in The Observer newspaper today, Will Hutton is right to focus on the problems in the housing market, and especially on the lack of affordable new homes both to rent and to buy. A major housebuilding programme has long been promised but even the modest government targets have been missed by over 100,000 new homes, not counting the backlog of under-building in previous years.
We need a grown-up approach to new housebuilding – which is therefore not about a blame game, is not about favouring one sector only at the expense of the others, and is not only about land supply pressures in London and the south east of England.

Link:
http://www.guardian.co.uk/commentisfree/2013/feb/24/affordable-new-homes-britain-future

The Bank of England has injected £375 billion through Quantitative Easing, but mostly this has been injected into the City of London. Whereas the USA federal government has used its QE programme in a more targeted manner into the ‘real economy’ by linking it to more jobs as well as lowering inflation.

There is talk of more QE still being needed in the UK because of subdued growth. This should happen, but QE or something similar needs to be targeted into government-backed infrastructure works and social house building throughout Britain.

A social entrepreneurship is leading the way here by showing government how this can be done, bottom up. Mencap along with Golden Lane Housing and the Triodos Bank are offering a 5-year fixed term bond at 4pc interest to finance social housing, building small group homes, each one for up to four learning disabled residents. The majority of British councils are reporting a shortage of housing for learning disabled people locally. The minimum investment is £2,000 and the bond issue seeks to raise £10 million by the end of April.

QE is sometimes referred to as monetary policy (crudely, what the Bank of England does) whereas infrastructure spending is covered by fiscal policy (crudely, what government can do).

The UK Budget on 20 March is a golden opportunity to scale up exactly this type of responsible and sustainable investment in the economy and in communities. Maybe even for council house building programmes.

Link:
http://www.mencap.org.uk/news/article/10-million-charity-housing-and-mencap

(updated, 24 February 2013)