Lack of skilled workers risks major infrastructure projects going over budget, PAC warns

Major projects in FE include the T Level roll out, Skills Bootcamps and the capital transformation programme

Major projects in FE include the T Level roll out, Skills Bootcamps and the capital transformation programme

Major government infrastructure projects risk going over budget due to a shortage of trained project managers and skilled workers, MPs have warned.

The government estimates that it needs to train about 16,000 civil servants at its major project leadership academy to deal with hundreds of publicly funded projects with an “unprecedented” total cost of about £800 billion.

However, a report published by the public accounts committee (PAC) has warned that the academy, which was set up 12 years ago, has only accredited about 1,000 government staff.

There is also a shortage in skilled professionals such as welders, electricians and bricklayers – all high-priority occupations that are eligible for the “skilled worker visa”.

Committee chair Meg Hillier said major infrastructure projects are at risk of being “poorly managed and delivered late and over budget” due to shortages in workers with essential skills.

The Infrastructure and Projects Authority (IPA) estimates the total whole life cost of the UK’s 244 major projects to be £805 billion, an increase of about £476 billion in the last four years.

In its recommendations, the committee has asked the Treasury and IPA to write an analysis of the risks the lack of skills poses to the government’s portfolio of infrastructure projects.

PAC’s report was based partly on concerns raised during a hearing earlier this year with Nick Smallwood the chief executive of the IPA.

Several major government projects related to FE have been assessed by the IPA, including the Lifelong Loan Entitlement, FE capital transformation, Skills Bootcamps and Free Courses for Jobs, and the T Level programme.

After five years of assessing the T Level programme, the IPA rated it ‘red’ in 2022/23, meaning that delivery of the project to time, cost and quality targets appeared “unachievable”. Government has already spent close to £1.8 billion on T Levels, which have been taken by only 30,000 students so far.

Smallwood said a lack of trained project managers in government creates a costly “overreliance” on consultants in the private sector.

In one example, he said competition with “massive investment” in infrastructure by Saudi Arabia resulted in “several hundred” designers leaving the UK market.

PAC and the National Audit Office (NAO) have both raised concerns about “acute” shortages in skilled workers in the UK.

In 2022, they highlighted the dramatic decline in the number of adults participating in government-funded education and skills training, which fell by half to 1.6 million in the ten years up to 2020/21.

In March, PAC published a list of essential government spending that should not be put off called ‘The Big Nasties’.

One of these spending areas is a “severe shortages of skills” in government, which cost an estimated £980 million in 2018 through the use of management consultancies.

PAC said: “Many projects and programmes across government are afflicted by delays, inefficiencies and budgetary overruns, often due to a lack of specialist skills amongst officials.

“The lack of skills must be addressed otherwise there will be huge risks to delivery of major capital projects.”

A government spokesperson said: “This government delivers some of the most challenging, ambitious and innovative projects the UK has ever seen.

“Speeding up delivery, while ensuring projects are effectively managed and deliver value for money, is a priority.

“Upskilling staff is a key part of this and we recently published a new framework to enable civil servants working on public projects to utilise AI to improve the effectiveness and efficiency of their delivery.

“We are on target to meet our long term ambition to accredit 16,000 civil servants as government project delivery professionals.”

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2 Comments

  1. There will always be occasions when specific skills will need to be planned into large government owned projects but all too often we continue to bumble along with the ‘slinky effect’ model of skills development that invariably leaves us short of skills, costs more in overrun and leaves us competing with other countries for the skilled labour we need.
    Quite rightly, skills development at a local level should be managed around the needs of employers but we must also proactively plan on a national level for skills development, particularly when we know what infrastructure programmes are coming down the track, to avoid both a skills deficit and an expensive, avoidable delay to the completion of these projects.
    All too often we fail to cohesively plan for the necessary skills we need as a country and all too often we fail to recognise the importance of trade skills, until we’re stood on the site of an unfinished project, scratching our heads pontificating the need to have skilled people in this country.
    This is getting boring, as a sector we can provide the solutions. Just talk to us!

  2. Martin Lovell

    The shortage of staff able to coach and assess in a professional, forward thinking manner just adds to the problem. Ask an average assessor for thier “Assessment Plan” for a learner and standby to be amazed.