Tag Archive for: Business Insights

Gavel striking sound block near coins and legal papers.

Contractor’s £22,000 Levy Appeal Fails Amidst System Criticisms

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A Surrey-based contractor, MJL Construction Associates, has been ordered to pay nearly £22,000 after losing its appeal against the Construction Industry Training Board’s (CITB) levy system. The company disputed levies for 2021 and 2022, citing concerns over apprenticeship training quality and questioning the assessment of subcontractors.

Key Takeaways

  • MJL Construction Associates was ordered to pay £21,913.27 in CITB levies.
  • The contractor argued that subcontractors should be responsible for their own levy payments.
  • The tribunal ruled that the company was correctly assessed under current legislation.

The Legal Challenge

MJL Construction Associates took the CITB to an employment tribunal, arguing that the levy system was failing. Director Leslie Blay contended that there was a “lack of face-to-face apprenticeship training courses,” questioning their standard, distance, and perceived lack of support. He also disputed the assessment, believing that subcontractors, who were also registered with the CITB, should be liable for the levy themselves.

Blay acknowledged that his only legally viable ground for appeal was the CITB’s assessment of his firm. However, he expressed a desire to critique the broader system, which he felt was not functioning effectively. He claimed that knowledge of the levy was “patchy” and that some eligible companies were not paying, leading to a disproportionate burden on others.

CITB Levy Explained

All firms with employees spending more than half their time on construction activities are mandated to pay the CITB levy. This funding is crucial for developing training within the industry, particularly benefiting smaller enterprises. Contractors are also liable for the levy on payments made to “net paid” subcontractors.

Tribunal’s Verdict

Judge Samantha Moore stated that legislation clearly obliged MJL Construction Associates to pay the levy concerning net-paid bona fide contractors. She clarified that this was not a case of the appellant paying on behalf of others, as many subcontractors should also be liable for their own levies. While acknowledging Blay’s concerns about the system’s fairness, the judge ruled that such arguments held no legal standing in this jurisdiction. Consequently, the tribunal found MJL had been correctly assessed and ordered the payment of £21,913.27.

CITB’s Response

A CITB spokesperson confirmed that MJL Construction Associates had exercised its statutory right to appeal. The spokesperson reiterated that the law requires registered employers to declare and be assessed on all payments made to net CIS subcontractors, irrespective of the subcontractor’s own levy status. This can indeed lead to both parties being assessed on the same work, a practice deemed lawful.

Sources

Cityscape at dusk with illuminated skyscrapers

Higgins Group Surges Back to Profitability with Turnover Exceeding £300 Million

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Family-owned contractor Higgins has announced a significant return to profitability, with its annual turnover surpassing the £300 million mark. This marks a strong recovery after two years of losses, driven by a substantial increase in revenue and strategic management of legacy issues.

Key Takeaways

  • Higgins Group reported a pre-tax profit of just over £1 million for the year ending July 2025, a notable increase from £280,000 in the previous period.
  • Turnover surged by 51% to £315 million, exceeding the £300 million threshold.
  • The company allocated £7.3 million towards rectification works on older projects and set aside an additional £3.9 million for remaining repairs.
  • Despite market challenges, sales rates and values remained in line with expectations, demonstrating the desirability of their homes.
  • The firm’s financial health improved, with cash reserves rising to £25 million and debt reducing to £14.7 million.
  • Higgins Homes has entered a not guilty plea to corporate manslaughter charges related to a 2018 incident.

Financial Recovery and Growth

The Essex-based contractor has successfully navigated a challenging period, reporting a pre-tax profit of just over £1 million for the year ending July 2025. This figure represents a substantial improvement from the £280,000 profit recorded in the previous year. The company’s income experienced a significant boost, climbing by 51% to reach £315 million, comfortably surpassing the £300 million milestone.

Addressing Legacy Issues

Higgins acknowledged spending £7.3 million on “rectification works” for older schemes during the reporting year. Furthermore, the company has earmarked an additional £3.9 million to address remaining repair obligations. Despite these costs, the firm expressed confidence in the quality and desirability of its housing developments, noting that sales rates and values were broadly in line with expectations.

Market Challenges and Future Outlook

While celebrating its financial turnaround, Higgins highlighted ongoing challenges within the construction sector. The company noted that regulatory requirements from the Building Safety Regulator, coupled with a complex planning system, have led to project start delays, particularly in London. Nevertheless, the firm’s financial position has strengthened, with cash reserves increasing by over £15 million to £25 million and total debt decreasing from £20 million to £14.7 million.

Legal Proceedings

In a separate development, Higgins Homes has entered a plea of not guilty to charges of corporate manslaughter. The charges stem from a fatal accident that occurred on a Higgins Homes construction site nearly eight years ago, involving the death of 28-year-old pedestrian Michaela Boor. The company stated that its directors believe there is a strong defence. A trial is anticipated to commence later this year.

Higgins was ranked 93rd in Building’s Top 150 Contractors & Housebuilders list last year, marking a rise of 28 places from the previous year.

Sources

Empty office space with reduced staff.

Hawkins Brown Faces Significant Profit Slump, Implements Staff Reductions

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Architectural firm Hawkins Brown has announced significant staff cuts following an alarming 80% drop in pre-tax profits for the year ending March 31, 2025. The firm’s financial performance has seen a notable decline, prompting these measures to address the challenging economic climate.

Key Takeaways

  • Pre-tax profit plummeted by 79%, from £1.3m to £267,000.
  • Turnover decreased by 16%, falling from £35.3m to £29.5m.
  • The average number of employees was reduced by 49, a 15% decrease.
  • The firm’s wage bill saw a reduction from £17m to £15.2m.

Financial Performance Decline

Hawkins Brown reported a substantial decrease in its financial standing for the fiscal year 2024-2025. Turnover experienced a 16% fall, dropping to £29.5m from £35.3m in the previous year. More critically, pre-tax profit saw a dramatic slump of 79%, reducing from £1.3m to just £267,000. This significant downturn in profitability has directly led to operational adjustments within the practice.

Staff Reductions and Cost Savings

In response to the financial pressures, Hawkins Brown has reduced its workforce. The average number of employees decreased by 49, representing a 15% reduction from 318 to 269 individuals over the reporting period. These staff cuts have contributed to a decrease in the firm’s wage bill, which fell from £17m in 2024 to £15.2m in 2025, indicating a strategic effort to manage costs effectively.

Market Performance

The firm’s income from its primary market, the UK, also saw a decline, falling from £33.3m to £28m. International revenue also slid from £2m to £1.4m, reflecting a broader challenge across its operational territories. This reduction in income underscores the difficult market conditions the practice has been navigating.

Notable Projects

Despite the financial challenges, Hawkins Brown has been involved in several significant projects. The firm was responsible for the design of Manchester Metropolitan University’s All Saints Library, though plans had to be substantially revised due to escalating construction costs. Other projects undertaken during the accounting period include a refurbishment of the grade II*-listed Norwich City Hall and a major redevelopment of London’s Victoria Station in collaboration with Acme for Network Rail.

Sources

London skyline with construction cranes and unfinished buildings.

London’s Housing Crisis Deepens Amidst Critical Construction Skills Shortage

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London is grappling with a severe housing crisis, exacerbated by a significant shortage of skilled construction workers. This deficit is not only delaying new home builds but also prompting potential buyers to opt for older properties, further straining the market. The situation highlights a critical need for workforce development in the capital’s building sector.

Key Takeaways

  • Over 10% of Londoners face waits exceeding a year for essential tradespeople like handymen and electricians.
  • A similar percentage of prospective buyers have delayed moving into new builds due to construction delays caused by a lack of tradespeople.
  • Many are choosing older homes over new builds because of projected longer construction timelines.
  • A tenth of potential buyers have abandoned purchases entirely due to mortgage offer expirations caused by building delays.

The Scale Of The Skills Gap

New data reveals the stark reality of London’s construction labour shortage. Polling indicates that more than one in ten London residents have endured waits of over a year for services from handymen or electricians. The situation is equally dire for other trades, with less than five percent of residents able to secure a roofer within a month, and only three percent finding a bricklayer in the same timeframe.

Impact On New Builds And Homebuyers

The consequences for the new build sector are significant. Thirteen percent of survey respondents reported delays in moving into their new homes because construction was not completed on schedule, directly attributed to a shortage of skilled workers. Furthermore, the same proportion opted to purchase older properties instead of new builds, citing concerns about significantly extended construction periods. Alarmingly, one in ten individuals were forced to withdraw from purchasing a home altogether when their mortgage offers expired due to these persistent building delays.

Challenges For Tradespeople And The Wider Economy

Clive Holland of Fix Radio highlighted that the demand for construction work consistently outstrips the available workforce, a gap that has been widening. He noted that working in London has become increasingly challenging due to factors such as high daily charges, elevated operating costs, the risk of tool and van theft, and general safety concerns. These pressures are leading many tradespeople to relocate to areas like the Midlands or Bristol, where the day-to-day pressures are more manageable.

Government Targets And The Reality On The Ground

The Mayor of London is tasked with delivering 88,000 new homes annually for the next decade. However, last year saw the completion of only 11,600 new properties. The Deputy Mayor for Housing, Tom Copley, has acknowledged a “crisis” in construction skills, expressing concerns about the insufficient number of trained workers and a lack of educators to train the next generation. This shortage impacts not only the quantity but also the quality of new homes, with an increase in snagging and remedial work suggesting a decline in build quality.

Proposed Solutions And Future Outlook

Calls are being made to make London a more viable place for tradespeople, including suggestions to scrap ULEZ and congestion charges for them and to strengthen enforcement against tool theft. While the government has pledged significant funding to create more skilled construction workers by 2029, the immediate impact on London’s ambitious housing targets remains to be seen. The complexity of the issue extends to attracting talent to teach in further education colleges, with current pay scales being insufficient to draw experienced professionals from lucrative building sites.

Sources

Thurston Group building, securing jobs for over 200 employees.

Jobs Secured: Thurston Group Acquired Out of Administration, Safeguarding Over 200 Roles

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Wakefield-based modular building manufacturer, Thurston Group, has been successfully acquired out of administration, securing the future of over 200 jobs. The deal, finalised on December 23rd, 2025, sees the company purchased by privately owned industrial firm GCH Corporation Ltd, preventing significant redundancies.

Key Takeaways

  • Over 200 jobs saved at Thurston Group.
  • GCH Corporation Ltd has acquired the modular building specialist.
  • Thurston Group faced “several business challenges” leading to administration.
  • The new owners are committed to stabilising and investing in the business.

Administration and Acquisition

Thurston Group, a manufacturer of modular and offsite buildings for sectors including healthcare, education, commercial, and industrial, had filed a notice to appoint administrators in late November 2025. The company, which employed 275 people at the time, appointed restructuring specialists Leonard Curtis to manage the administration process and identify a potential buyer. The sale to GCH Corporation Ltd was completed swiftly, with administrators confirming that the deal successfully protected over 200 jobs, although some redundancies were unavoidable.

New Ownership and Future Outlook

GCH Corporation Ltd, a London-based industrial manufacturing and distribution firm, acquired Thurston Group for an undisclosed sum. Cassie Hutchings, CEO of GCH Corporation, expressed enthusiasm for the acquisition, stating, “Thurston is a respected UK manufacturer of modular buildings with a strong heritage and deep sector expertise. As a long-term, privately owned industrial group, GCH is committed to stabilising and investing in the business. We are excited to welcome Thurston into the GCH family and look forward to supporting its next phase of growth.”

Business Challenges and Strategic Position

Thurston Group’s most recent annual results, for the year ending October 31, 2024, showed a revenue of £46.5m and a pre-tax profit of £2.5m. However, the company had warned of “numerous external pressures” impacting the construction industry, including decreased client spending, cost inflation, and labour shortages. Despite these challenges, Thurston Group holds positions on several significant public-sector frameworks, such as LHC Procurement Group’s £265m modular buildings framework and the £3bn Major Works Education Framework in London. The company had also made strategic acquisitions in the past year, including Storplan Racking Ltd and Alsim System Building, and had set ambitious turnover targets for 2027.

Sources

Kier Group contract for new Darlington Government Hub building.

Kier Group Secures Major Contract for New Darlington Government Hub

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Kier Group has been awarded a significant contract by the Government Property Agency (GPA) to construct a new civil service office in Darlington. This development marks a key milestone in the Government Hubs Programme, aiming to decentralise government functions and boost regional economies. The project is set to create a modern, collaborative workspace for over 1,500 civil servants.

Key Takeaways

  • Kier Group will lead the construction of a new government hub in Darlington.
  • The hub will house over 1,500 civil servants from multiple government departments.
  • Construction is scheduled to begin in early 2026, with completion expected in the first quarter of 2028.
  • The project is part of the wider Darlington Economic Campus initiative.

Project Overview

The new government hub, located on Brunswick Street, will be a state-of-the-art facility designed to foster collaboration and smarter working practices among civil servants. It is part of the Government Hubs Programme, which aims to establish modern, efficient, and sustainable workplaces across the UK, moving jobs away from London and supporting the government’s ‘levelling up’ agenda.

The project involves the construction of a five-storey building on the site of a former car park. Kier’s initial involvement included preliminary ground remediation works, such as clearing debris and removing remnants of previous structures. These early works, which began in September and are expected to conclude in December, have helped to de-risk the project and prepare the site for main construction.

Timeline and Occupation

Main construction works are slated to commence in early 2026 and are anticipated to last approximately two years. The hub is projected to be ready for occupation in the first quarter of 2028. This timeline ensures the project aligns with the broader development of the Darlington Economic Campus (DEC), which already includes Feethams House and Bishopsgate House.

Departments and Impact

Staff from seven government departments will eventually be based at the new hub. These include HM Treasury, the Office for National Statistics (ONS), and the Department for Culture, Media and Sport (DCMS). The relocation of these roles is seen as a significant boost for the North East, contributing to economic growth and creating new job opportunities within the region. Darlington already hosts a substantial number of civil service roles, with ten major government departments represented in the town.

Collaboration and Future Growth

The Government Property Agency (GPA) is leading the development, working closely with Kier Group. This partnership aims to deliver a high-quality, inclusive, and digitally-enabled workspace. The project is expected to create substantial regional economic benefits and contribute to a more representative Civil Service workforce.

Planning permission for the five-storey building was approved in August 2024, following archaeological surveys. The development is a key component of the DEC, reinforcing Darlington’s position as a significant hub for central government operations outside of London.

Sources

Henry Group Holdings liquidation: creditor claims and financial distress.

Henry Group Holdings Faces £141 Million in Creditor Claims Amidst Liquidation

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Administrators for Henry Group Holdings (HGH) have reported receiving claims totalling £141.15 million from unsecured creditors. The London-headquartered company, established in 2016 and solely owned by Mark Henry, entered liquidation on August 18, 2023. HGH is the parent company of Henry Construction Projects, which is also currently in administration.

Key Takeaways

  • Unsecured creditors have lodged claims amounting to £141.15 million against Henry Group Holdings.
  • The parent company, HGH, entered liquidation in August 2023.
  • Its subsidiary, Henry Construction Projects, is also under administration.
  • Administrators are working to assign some claims to the subsidiary’s administration process.
  • A separate £31 million High Court claim has been filed against former directors of Henry Construction.

Claims Against Henry Group Holdings

Joint liquidators Kevin Coates and Robert Starkins from Grant Thornton UK Advisory are managing the winding-up progress for HGH. Their report indicates efforts are underway to assign certain claims to the administrators of Henry Construction Projects Ltd. The primary remaining tasks involve monitoring the progress of these assigned claims, which includes seeking advice from their legal team. Future realisations are currently uncertain and will depend on the successful pursuit of these claims.

Legal Action Against Henry Construction

Meanwhile, the administration of Henry Construction is being handled by FRP Advisory. This firm has initiated a £31 million High Court claim against six family members and former directors of Henry Construction, including Mark Henry. The claim alleges unlawful payments were made from the firm for a family home and relatives’ tax bills, with administrators seeking repayment. A defence document filed with the court asserts that the parties deny all accusations of wrongdoing and argue that the payments were part of a legitimate intercompany arrangement.

The defence document further states that the defendants deny liability on all fronts. The administrators’ claim highlights a “pattern of conduct by Mark Henry” to transfer sums from his companies to “connected persons shortly before they entered insolvency”.

Financial Performance and Insolvency

Henry Construction Projects previously reported a turnover of £402.2 million and a pre-tax profit of £14 million in its financial accounts for the year ending June 30, 2021. However, the firm appointed administrators in June 2023, at which point it owed more than £40 million to suppliers. The next report to creditors from HGH’s liquidators is expected by December 25, 2026.

Sources

Pomona Island development with new homes and public access.

Manchester Waters Masterplan Advances: 2,600 Homes and Public Access for Pomona Island

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Peel Waters has submitted a significant outline planning application to Trafford Council for the next phases of its £800 million Manchester Waters masterplan. This proposal aims to transform approximately 25 acres of brownfield land on Pomona Island into a vibrant new neighbourhood, offering extensive public access and amenities for the first time in decades.

Key Takeaways

  • An outline planning application has been submitted for the next phases of the Manchester Waters masterplan.
  • The development will regenerate 25 acres of brownfield land on Pomona Island.
  • Plans include approximately 2,600 new homes across various tenures.
  • Over half of the site will be dedicated to public and green spaces, including a five-acre park.
  • The masterplan aims to open Pomona Island to the public for the first time in many years.

A New Waterfront Neighbourhood

The comprehensive masterplan for Manchester Waters includes proposals for around 2,600 new homes, encompassing affordable housing, build-to-rent options, homes for sale, student accommodation, and facilities for older people. Beyond residential units, the development will feature a hotel, flexible workspaces, retail premises, leisure facilities, and spaces for hospitality businesses.

A key aspect of the plan is the significant allocation of land for public and green spaces. More than half of the 25-acre site is earmarked for these areas, including a substantial five-acre park situated by the water. The design also incorporates new routes for walking and cycling, intended to seamlessly connect the site to central Manchester, MediaCity, and Trafford Wharfside, further promoting sustainable travel alongside existing tram links.

Community Engagement and Future Vision

Prior to submitting the application, Peel Waters conducted a thorough public consultation. This engagement involved an online survey and a webinar, attracting around 100 participants. The company reports that 78% of respondents expressed support for the neighbourhood’s development. Feedback primarily focused on green space provision, ground-floor uses, and improvements to cycling infrastructure. Peel Waters has stated that all feedback was considered in refining the submission, and they are now collaborating with local residents on potential names for new public areas and parks.

Leigh Thomas, Development Director at Peel Waters, highlighted the significance of this step, stating, “This masterplan will open up Pomona Island to the public for the first time in decades, creating a unique ‘island’ neighbourhood with parks and recreation space for future visitors, residents and workers to enjoy, whilst ensuring there is a housing option for all incomes and ages.” He added that over 1,000 new homes could be completed within the next five years, a prospect he described as “exciting.”

Building on Previous Success

The Manchester Waters project builds upon earlier phases of development. Nearly 600 homes have already been delivered in partnership with X1 Developments and Hestia, with an additional 500 homes scheduled to commence construction in 2026. Furthermore, at Cornbrook, Peel Waters has facilitated projects with Glenbrook and Forshaw Group, resulting in 280 homes and a convenience store, with another phase of 237 residences, an aparthotel, and a café planned. This latest application represents a crucial step in Peel Waters’ broader strategy of regenerating waterfront locations across the UK.

Sources

New housing estate development in London with apartment buildings.

London Set for Major Housing Boost as 1,000-Home Estate Regenerations Get Green Light

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Two significant estate regeneration projects in London, set to deliver nearly 2,000 new homes, have received planning approval. These developments, spearheaded by housing associations and developers, aim to transform existing estates into vibrant communities with a substantial proportion of affordable housing and improved public amenities.

Key Takeaways

  • Two major London housing developments, totalling almost 2,000 homes, have secured planning permission.
  • Both projects emphasize a significant commitment to affordable housing, including social and London Affordable rent.
  • The schemes will introduce new public green spaces, community facilities, and improved amenities for residents.

Northwick Park Regeneration Moves Forward

Housing association Network Homes has been granted approval for a scheme comprising nearly 1,000 homes on land adjacent to Northwick Park Hospital in north-west London. This project is the second phase of a larger £450 million development that will ultimately deliver 1,600 homes. The overall development, designed by PRP, will feature 19 buildings and include student facilities, commercial spaces, and a nursery. A key feature of this phase is the commitment to 40% affordable homes.

The first phase of this development, which included 654 homes, received approval last year. The partnership behind this regeneration includes Network Homes, London North West Hospitals NHS Trust, Brent Council, and the University of Westminster. This collaboration has also secured £500,000 from the One Public Estate programme to optimize land use.

Friary Park Estate Transformation

In west London, Ealing council has given the go-ahead for a 990-home regeneration of the Friary Park estate. This project is a collaboration between housing association Catalyst and developer Mount Anvil. Subject to the signing of section 106 agreements, construction is expected to commence next year.

The scheme, designed by Levitt Bernstein, will introduce four new tower blocks, with heights ranging from 14 to 24 floors. A significant aspect of the plans is the commitment to delivering 45% genuinely affordable housing, which includes 237 social rent homes and 28 London Affordable rent homes. Beyond housing, the regeneration will significantly enhance green spaces, offering residents private balconies and terraces, podium gardens, play trails, and a new community centre with an improved multi-use games area.

Sources

Empty train carriage on a railway track.

Babcock Rail Plunges to £5m Loss Amidst Rail Framework Slowdown

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Babcock Rail has reported a significant pre-tax loss of £5.2 million for the year ending March 31, 2025, a stark contrast to the £4.8 million profit recorded in the previous year. The downturn is attributed to a slowdown in work across several major rail frameworks and reduced client budgets, leading to a substantial drop in turnover.

Key Takeaways

  • Babcock Rail experienced a pre-tax loss of £5.2m in the year to 31 March 2025.
  • Turnover fell by a third, from £171m to £116.3m.
  • Reasons cited include a slowdown on major frameworks and reduced budgets from clients like Translink.
  • The company incurred £2.7m in restructuring costs.
  • Provisions for future costs increased significantly, including a £5.2m legal provision.

Financial Performance and Contributing Factors

The company’s financial performance was heavily impacted by a confluence of factors. Turnover at Babcock Rail decreased by approximately 32%, falling from £171 million to £116.3 million. This reduction in revenue is linked to the completion of projects on multiple frameworks and a general transition to a new control period within the rail industry. Daniel Hall, finance director at Babcock International, explained that trading reflected “underlying market conditions” leading to revenue reductions during this transition phase.

Specific project impacts include a significant reduction in revenue from Northern Ireland’s Translink, following the completion of major projects and a decrease in the client’s annual funding. Furthermore, revenue from the Medium Signalling Framework in Scotland more than halved, dropping from £20.4 million to £7.2 million, as existing projects concluded.

Restructuring and Provisions

In response to the dip in activity, Babcock Rail undertook restructuring activities costing £2.7 million. The business is now organised around two primary delivery streams: Rail Systems Alliance Scotland and Rail Systems. The company also reported an increase in provisions for future costs, rising from £1.5 million to £8.5 million. This includes a substantial £5.2 million legal provision related to late payment interest charges and penalties stemming from potential compliance errors concerning supplier payments, specifically linked to the Construction Industry Scheme and Domestic Reverse Charge VAT. An additional £2.4 million provision was made for dilapidation costs and contractual obligations on infrastructure.

Future Outlook

Despite the recent losses, Babcock Rail remains optimistic about its future prospects. The company has an order book valued at £16.7 million and sees potential in market opportunities and its position on several zero-valued frameworks. The decline in employee numbers, from 745 to 676, and a corresponding reduction in the wages bill, from £55.9 million to £48.7 million, reflect the company’s adjustments to the current market conditions. The challenges faced by Babcock Rail echo sentiments from other industry players who have also cited delays in Network Rail projects as a reason for reduced profit forecasts.

Sources

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