2nd Quarter 2002 - Current Issues Around a fifth of all respondents, the same proportion as in the first quarter survey, used the 'scribble pad' on the back of the questionnaire to comment on the state of trade, or on issues which they feel the FMB should be addressing on behalf of its members. There were very few comments this time on the state of trade. They were equally divided between those supporting the overall conclusion of the survey, that the trend in workload of small and medium-sized building firms remains strong, and those from firms that are very clearly not benefiting from this overall trend. Where issues are concerned, these are mostly familiar from previous surveys, including the rate of VAT on home improvements and repairs, and what several respondents describe as a "continual increase" in bureaucracy and 'red tape'. FMB members continue to call for a cut in VAT on housing RMI work, and also - albeit without much hope - for a turn in the rising tide of 'red tape'. Both of these topics are linked directly with that of distortion of competition, particularly in the private housing repair, maintenance and improvement segment of the market, by 'cowboy builders' not charging VAT but working for cash in hand, and not complying with new legislation and regulations or incurring the costs of compliance. It is again clear that a significant number of FMB survey respondents are very sceptical of the value of the measures that the Government has taken and is proposing to try to drive out 'cowboy builders'. There is particular concern over the balance of costs and benefits to legitimate building SMEs of various registration schemes, with several firms complaining that few consumers appear to pay any regard to whether firms are registered, and others saying that, if they try to pass on the costs of registration, that only further widens the gap between their prices and those quoted by 'cowboys', increasing the probability that they will lose out in the competition for work. There is also in this survey a rise in complaints about what some firms describe as 'cowboy clients', which is a term used variously to describe those who pay late or not at all, and those who waste the time of builders registered for VAT by soliciting estimates that they use only as benchmarks with which to compare the deals offered by others working for cash in hand. By comparison, there is a further fall in expressions of concern over the organisation and effects of the Construction Industry Scheme for the taxation of sub-contractors in the industry. There is still no comment suggesting that the claimed improvements to the CIS are producing any beneficial results. As has been the case since the middle of last year, however, comments on these highlighted issues are all outnumbered by expressions of concern over skill shortages, and the failure of the industry to attract and train sufficient new entrants to cure them. As last time, most of those who have written in on this issue, whilst not denying the responsibility of the building industry to improve its image and promote careers in the industry more robustly, consider that levels of recruitment and skill training will not be improved without more active support from the Government, involving financial support for on-site training in construction skills. Further Information For further information, please contact: Federation of Master Builders Gordon Fisher House 14-15 Great James Street Holborn London WC1N 3DP Tel: 020 7242 7583 Fax: 020 7404 0296 First posted: 14 August 2002. Last modified: 16 August 2002.