In recent years Jersey has had a thriving construction sector evidenced by the delivery of high-profile developments such as Horizon, IFC6 and La Collette Low Rise. However, the Island now finds itself at a Crossroads. The recent demise of Camerons and JP Mauger and delays in the planning process for large projects have emerged as a significant challenge, leaving a profound impact on the construction sector.
Stifling Economic Growth
Delays in the planning process can lead to a stagnation of economic growth. Large construction projects are often viewed as catalysts for economic development, providing a boost to employment, local businesses, and property values. Bearing in mind that construction currently employs around 6,000 people and contributes 7.5% towards the Island GDP, when projects such as Les Sablons, South Hill and The Waterfront Masterplan stall, the anticipated economic benefits are put on hold, affecting the overall prosperity of the community.
Escalating Costs
Time is money, especially in the construction sector. Delays result in increased costs, both directly and indirectly. Jersey, like everywhere else, is currently seeing eyewatering build cost inflation. This is reported to have been up to 43% in the UK since 2020. This coupled with a fall in values will have a significant negative impact on the viability of construction projects.
Resource Allocation Challenges
Construction projects require precise coordination of professional teams, manpower, materials, and equipment. Delays in planning disrupt this delicate balance, leading to inefficient resource allocation. Idle workers, unused materials, and underutilised equipment not only contribute to financial losses but can also lead to reduced productivity among the workforces. The knock-on impact to small local sub-contractors cannot be understated. With the demise of Camerons, Jersey is faced with a significantly reduced capacity for larger projects and without ongoing work this could be further reduced. Once the capacity is gone, it is very difficult to replace. Who will actually build the proposed new Hospital? Furthermore, lack of competition in the sector will further fuel cost inflation.
Skills and Innovation
The Island has been very successful in promoting education and skills in the construction sector but with larger projects being delayed, opportunities will diminish, and workers will inevitably look elsewhere, leading to a shortage of well-trained workers in the future.
Legal and Regulatory Complications
Prolonged delays in planning may inadvertently result in non-compliance with new evolving building codes and regulations. For example, Jersey’s emerging JEPA legislation. This could lead to costly redesigns or retrofits. A smooth planning process ensures that all legal and regulatory requirements are met from the outset, mitigating potential complications down the line.
Reputational Damage
Delays in the planning process, or lack of understanding when Ministers deviate from Planning Inspectors recommendations, can severely undermine the confidence of developers and contractors. Anecdotally we are aware of a number of large developers who are reluctant to invest in large scale development projects in Jersey given the current perception of Planning risk.
Conclusion
Efficient and timely planning is the cornerstone of successful development projects. In Jersey, as in any thriving community, it is necessary to address the challenges posed by delays in the planning process. Perhaps before we start conversations about building bridges to France our elected representatives would be better served to look closer to home. By streamlining the process, adopting a forward-looking approach, and enhancing collaboration between stakeholders, the States of Jersey should be seeking to unlock the full potential of its construction sector and start a new era of sustainable growth and development.
