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FMB chief: 'Government must get serious about SMEs'

The Federation of Master Builder’s chief executive could be forgiven for having a gloomy outlook on the industry given the dozens of companies going bust each month, the negative publicity generated by cowboy builders and a lack of public knowledge about the forthcoming Green Deal.

Brian Berry is trying to steady the ship eight months after the FMB’s director general Richard Diment left following a row with senior figures at the organisation. He insists its 10,000-strong membership has grounds to be optimistic about the future.

The federation has published a five-year plan to try and ensure long-term growth (see below), while CN has revealed its plans to create new regional hubs and move to a new London headquarters.

The FMB is now looking to government to start fulfilling promises and return the UK to economic growth by placing construction and its small and medium-sized enterprises at the heart of the recovery.

Walking the walk

“The government has always talked a good talk about SMEs,” says Mr Berry. “Now they have been in government for two and a half years we need to see a serious commitment about what SMEs can do in the construction sector.

“We keep in good contact with the Labour Party and also the Lib Dems because we know the coalition could break up after the election and we want to maintain access to all parties – because you never know what the future will hold.”

As well as lobbying the main political parties and the incoming chief construction adviser Peter Hansford, Mr Berry is continuing to shout about the need for Green Deal incentives and cuts to VAT for home improvement work.

The FMB’s members, particularly larger building contractors, are also keen that it can prove its influence with the government and that they can be differentiated from the ‘cowboy builders’ that give the industry a bad name.

The FMB has started to combat bad practice on the ground, including introducing a compulsory site inspection for companies wishing to join the federation. It is considering the introduction of a three-year regular inspection of companies to ensure they adhere to its code.

But with cowboy builders continuing to generate headlines and fears that the Green Deal’s launch next month is turning into something of a damp squib, the FMB’s voice will need to be heard more than ever.

“Work is an important issue, particularly with small companies,” adds Mr Berry. “But others are looking for a differentiation between non-member companies.

“They’re looking for that badge that says they are professional builders, they adhere to a professional standard.

“Because that doesn’t exist at the moment, it needs to be underpinned by a commitment to quality.

“It’s not just a case of pay your money and get your badge. We’re looking at the idea of renewing that inspection every three years, so once you’re in it’s not the case you’re [automatically] in for the rest of your life.”

FMB Strategic Plan 2012-2017: Pathway to Professionalism

The document sets out the scale of the challenge being faced by the FMB, which had 20,000 members 30 years ago and now has half that total.

It sets out strategic priorities such as: restructuring senior management; aiming for membership of 15,000 by 2017; reviewing and developing FMB services and governance; and becoming a competent person scheme operator.

The plan states that all FMB services need to become more business focused with an emphasis on income generation; new directors will be tasked with generating income from non-subscriptions including events, conferences and venue hire.

It will also consider creating a separate company to handle commercial activities and states that the FMB needs to “become much better at internal communication”, offer regular training and offer a pay and reward structure matched to staff performance.

Mr Berry said: “We have developed a five-year strategic plan which sets out a series of objectives we want to carry out. Mission is to transform itself to become a professional trade association - underpinning our commitment to professional standards.

“We want a one-stop shot for SMEs. We want the offer to be so attractive that an SME wouldn’t need to go anywhere else. We’re doing that through a whole range on initiatives the biggest one is the introduction of FMB certification.”

The federation is setting up four regional hubs to oversee its work in the eight English regions – a move that will cut costs and will, Mr Berry hopes, put regions at the heart of the organisation.

It is also hoped the hubs will help to defuse tension that exists within the organisation over the differences between the economy of London, where the FMB has its headquarters, and the rest of the UK.

“[Members] can resent the London and South-east region because things are done differently here, the economy is much stronger and that causes tensions in any organisation that’s UK-wide,” Mr Berry says.

“By creating regional hubs we will be able to understand members within their locality who share ideas and information in a region that has its own problems.”

The FMB currently has a consultation out on the proposals, with staff being asked to apply for new senior roles created within the hubs.

Mr Berry says his step-up to the role of chief executive was a “natural progression”. He has been in the role for six months, since being one of several staff asked to bring stability in the interim period after Mr Diment went on leave in November 2011.

“I’m loving the challenge,” he says. “It’s really good to be in a position where I can influence and make decisions. Getting consensus [among members] so far hasn’t been as difficult as I thought it would.

“It’s down to communication. I spend a lot of time explaining to members why we are making changes. You need to engage with them at a local level.

“That’s why I think I’ve won the support of members, by getting out of London and getting to know them in their locality.

“They know they are suffering, changing their work practises and there is a recognition that the FMB needs to do the same.”

He adds: “I had been at the FMB for four years so I was well known in the organisation and hopefully within the sector. It was a natural progression.

“I think that helped in terms of stabilising the FMB and I was able to build on that work going forward as the chief executive.”

Stable footing

In the current economic climate companies are going to the wall every day, and it’s a situation that trade bodies are not immune from – something Mr Berry acknowledges – but he is adamant that the FMB’s property portfolio sets it apart when it comes to financial stability.

The FMB is in the process of selling its London headquarters at 14/15 Great James Street and has found a buyer for the property at around £5 million. It hopes to spend around £3m on a new property at Ely Place in London’s EC1, with negotiations ongoing.

Mr Berry has told CN the extra cash may go on new properties in what is a buyer’s market, but says the FMB does not need the money.

“The FMB is on solid ground,” he adds. “We’re really fortunate we have an extensive property portfolio worth many millions of pounds; it puts us in a secure position and gives us an opportunity to invest in new things we want to do going forward.

“Our portfolio is based on owning our own freehold portfolios. We own nearly all our offices around the UK. We don’t need the money. We can rationalise our office [at Great James St] and that releases more money to invest elsewhere.”

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