Construction industry’s ‘rotten culture’ faces reckoning after Grenfell report

After the damning findings of the public inquiry into the Grenfell Tower fire and with the threat of criminal proceedings hanging over key players, the construction industry is facing a moment of reckoning.

The 2017 fire that killed 72 people stemmed from a “rotten culture in the construction industry”, where multiple failures occurred across the supply chain, according to Dame Judith Hackitt, an engineer who led a review on building safety after Grenfell.

She said the inquiry report, published on Wednesday, which chronicled multiple failures in the construction industry, the council, regulators and central government, “provides all of the evidence and more to reinforce the messages that I gave about the state of that culture in the industry back in 2017”.

She added: “This whole issue is about much more than cladding and insulation. It is about an industry that does not assure quality in the building of homes for people to live in in the way that it should.”

The 1,700-page report by Sir Martin Moore-Bick, the chair of the public inquiry into the disaster, found a chain of failures over decades that ultimately contributed to the fire, including “systematic dishonesty” on the part of the makers of the cladding panels and insulation products, Arconic, Kingspan and Celotex. The architects Studio E, the builders Rydon and Harley Facades, and the Royal Borough of Kensington and Chelsea’s building control department all bore some responsibility for the blaze, the report said.

The findings laid bare some of the deeper structural problems at the heart of the construction industry – not least its highly fragmented, intensely competitive and blame-shifting nature. Operating on wafer-thin margins, contractors and subcontractors are interdependent while also trying to squeeze out their slice of the profits.

The number of subcontractors on building sites has steadily risen since the 1980s, although specialist work has always been subcontracted to expert companies.

In her 2018 report, Building a Safer Future, Hackitt wrote of a “system failure” and condemned “the primary motivation … to do things as quickly and cheaply as possible” in an industry driven by profit rather than safety. She also blamed confusion about the roles and responsibilities at each stage.

The construction analyst Stephen Rawlinson, at Applied Value, said: “Always in the construction industry, you’ve got everybody looking at the other guy, saying: ‘It’s his fault, right?’ In the case of Grenfell, there seem to be some problems all the way along the line.

“A lot of it goes back to the fact that people want a building as cheap as possible.” Construction companies work on small operating margins (the ratio of operating profit to revenue) – about 2% to 3% in contracting – which can influence behaviour.

“There is a remarkable lack of skills and knowledge in the industry since the 1980s as funding has been cut from industry training boards and training schemes,” Rawlinson said. He also pointed to a wave of deregulation since the mid-1990s, and said of the measures recommended by the inquiry report to make buildings safer: “All this existed in the 1980s.”

Moore-Bick’s report condemned David Cameron’s “bonfire of red tape” deregulation drive. As for the regulators, the British Board of Agrément, which certificates construction products as safe, was described as “incompetent”.

The Building Research Establishment, a former government national laboratory set up in 1921, tested products and issued safety certificates, but was privatised in 1997 and the government limited the advice it was asked to provide on fire safety matters. Rawlinson said testing was “now more of a self-regulating environment”.

The cladding materials and insulation in the walls of Grenfell Tower proved to be highly flammable. The inquiry report said the key companies involved – Arconic, Celotex, and Kingspan – had engaged in “deliberate and sustained strategies to manipulate the testing processes, misrepresent test data and mislead the market”. The companies pushed back against this.

The architect, main contractor and cladding contractor also came under heavy criticism in the report. Studio E, a now defunct architectural practice, “demonstrated a cavalier attitude to the regulations affecting fire safety” and did not recognise that the cladding was combustible.

The Grenfell disaster was one of a series of tower block fires, and by far the deadliest, coming after the 2009 Lakanal House fire, in which six people died, and the 1991 fire at Knowsley Heights in Liverpool.

The government set up a building safety fund in 2020, and housebuilders were asked to pay into it to fix fire safety problems with external cladding in high-rise towers taller than 18 metres (59ft) across England.

Last year, a new crisis broke out over aerated concrete, a widely used material that was liable to sudden collapse. The government ordered more than 100 schools in England to immediately shut buildings made with the light concrete that was used in the construction of schools between the 1950s and 1990s.

There have been many scandals in the industry, such as the 2008 blacklist controversy, whereby construction site workers were singled out for being union activists who spoke out over health and safety concerns.

The construction industry was also embroiled in a series of scandals around private finance initiative (PFI) projects. PFI, launched in the early 1990s, was ditched in 2018 after bitter disputes about the high costs of the schemes, and their design and structural problems.

Hackitt said cutting corners “still remains the prevailing attitude in many places, and until our procurement processes change to call for quality … that will continue to exist”.

She said there were some promising signs of change, driven by the Building Safety Act 2022, adding: “We are starting to see some of the big players certainly take the lead.” But, she said, “Far too many [people in the industry] are still dragging their feet.

“We need to be able to raise the bar and raise standards by recognising those who are doing the right thing whilst at the same time naming and shaming those who don’t.”

With the Labour government keen to kickstart a wave of housebuilding, and demands to make existing homes more energy-efficient and less carbon-intensive, that drive to improve standards is all the more pressing.

The Construction Products Association, a trade body, said: “Whilst we recognise the very worst of the culture and practices reflected in the Grenfell tragedy, we see an industry that over the past seven years has been changing and has a desire to demonstrate that it can be trusted to deliver safe and high-quality buildings for those who live and work in them.”

The industry body has developed a code for construction product information to ensure products are marketed appropriately. It also noted that a formal British standard to improve the competence of those procuring, designing, constructing and inspecting buildings was nearing completion.

As a result of Hackitt’s 2018 review, two regulators were introduced: the building safety regulator and the Office for Product Safety and Standards. Now there are calls for an overall regulator to ensure greater accountability.

Rico Wojtulewicz, the head of policy and market insight at the National Federation of Builders, said: “When you read the Grenfell report, it’s obvious that there is a mismatch between building control, designers, contractors and others; what we really need to do is ensure that everybody knows who is accountable for what, and that is something that really needs to be firmed up.”