Official Report: Minutes of Evidence

The Chairperson (Mrs Erskine): I welcome Mr Gordon Best, regional director of the Mineral Products Association Northern Ireland (MPANI); Mr David Chambers, chairman of the highway maintenance and construction group for the Mineral Products Association Northern Ireland; and Mr Mark Quigley, member of the highway maintenance and construction group for the Mineral Products Association Northern Ireland.

I seek agreement from members that the evidence session is reported by Hansard.

Thank you for joining the Committee this morning. We appreciate your time to talk to us on this important matter. We have substantial written evidence from you, so, as is usual with evidence sessions, I will give you five minutes to brief the Committee. I am keen that we get to members' questions, because there are things that we would like to tease out from the written evidence that you provided. I will let you introduce yourselves. You have five minutes in which to talk to the topic.

Mr Gordon Best (Mineral Products Association Northern Ireland): Thank you, Chair. I am Gordon Best, regional director of the Mineral Products Association (MPA).

Mr Mark Quigley (Mineral Products Association Northern Ireland): Thanks, everybody. I am Mark Quigley, contracts director with Breedon and a member of the MPA highway maintenance group.

Mr David Chambers (Mineral Products Association Northern Ireland): I am David Chambers, commercial director at Gibson Bros and a member of the MPA.

Mr Best: As you said, Chair, the Committee has received our written introduction. I will read through some of it, and we can cover anything that I do not cover in my briefing, particularly on planning reform, decarbonisation and NI Water issues, during the Q&A.

On behalf of the panel and our MPA members, I extend thanks to the Chair, Deborah, to the Deputy Chair, John, and to Committee members for affording us the opportunity to inform you about the crisis facing the sector, which, I reckon, is the biggest funding crisis that we have faced in over 25 years. The current budgetary and human resource issues are impacting negatively on our ability as an industry to deliver work to maintain our valuable road network, which is now estimated by the Department for Infrastructure to be worth in the region of £40 billion. It is the largest infrastructure network managed by the public sector in Northern Ireland.

As an industry, we are only too aware of the budgetary challenges that face the Executive, but it is incumbent on us all to work collaboratively to ensure that, even with the challenges that we currently face, we can deliver the necessary essential maintenance, quality and value for money for the Northern Ireland taxpayer. You will forgive me for having a strong feeling of déjà vu: a number of you will know that our association has come to the Committee in previous years to highlight exactly the same need for additional in-year funding to ensure the continued maintenance of our roads. It would not be an exaggeration to say that it is a now a funding crisis. The fact that the majority of contractors are represented in the Public Gallery is a measure of that crisis.

As in previous years, the fact that we depend on getting money that other Departments cannot spend is not a sustainable situation. It costs more in the long term, because reactive maintenance eventually turns into expensive reconstruction. The long-term objective is to achieve multi-year Budgets that will result in more certainty and better work planning, and we know that the Executive aspire to achieve those longer-term Budgets. At present, however, the fact is that the initial allocation that was issued in April and the £12 million received for capital roads maintenance in the June monitoring round have all but been allocated and spent, meaning that we need to see a strong, successful bid for additional funding in the autumn monitoring round and that funding being received. If that does not happen, the contracting industry will grind to a halt over the next six to eight weeks.

There must also be recognition and understanding of the impact that increased materials and wage inflation have had since 2021, effectively meaning that every £1 spent on the ground does not cover the same amount of work as it did in previous years. Our association carried out an assessment of the inflationary impact from 2021 across energy use, haulage, labour, material and plant, and it concluded that there has been an increase in the region of 30%. That means that, if we were to see the same structural maintenance spend as we did in 2022, which was £126 million, we would need a spend of around £164 million in 2024-25. That supports the Department's estimate that the 2019 Barton report's estimate of £143 million for the annual structural maintenance funding plan now stands at a staggering £190 million. That is just to keep our 27,000-kilometre road network in a safe and quality condition.

Approximately 950 men and women are employed in the administration, manufacture, delivery and operational sides of the road maintenance sector in Northern Ireland. We are here on those people's behalf to ask that everything possible be done to ensure that we have the funding to do what we do best, which is maintaining our vital road network. If future maintenance funding is not forthcoming in October, many of those 950 employees will not have a job. We estimate that as many as a quarter of them will have to be laid off. Given that we have almost full employment and many employees are skilled in what they do, the industry is likely to have difficulty in getting them back if and when funding levels are greater.

Committee members will also be well informed that the budgetary challenges that we face are made worse by the high vacancy levels in key areas of delivery in the Department's transport and road asset management (TRAM) unit. We are aware of and support the efforts being made by the Department to address the skills and experience deficit by recruiting apprentices and graduates. We have offered support and collaboration from the huge resource of industry expertise and experience to assist in making the delivery of road maintenance schemes quicker and more efficient. We would also be willing to assist with the induction and training of the new DFI apprentices and graduates. We have identified apparent duplication between industry and DFI in areas such as utility searches, site supervision, inspection and testing. All our members and contractors working for DFI have third-party accredited quality schemes and CE marking for all our products and management processes that are used for delivering our activities. Is there really any need for the level of DFI supervision on-site?

The Chairperson (Mrs Erskine): Sorry. If you do not mind, I will cut in there for the sake of time. I am keen to come to members' questions to tease out some of the issues. We appreciate the written evidence that you gave us, and we were able to read it in detail before today's meeting. Thank you for that. I will go straight to questions, if you do not mind.

We are aware that there is a shortfall in the transport and road asset management group's budget allocation. The assessed need for 2024-25 was £246 million. The subsequent budget allocation was £155·3 million, with a further allocation made in the June monitoring round. The group is obviously operating a limited service. We appreciate that some road projects have been brought on, such as the A5 and the Enniskillen bypass, which you are aware of — I heard you talk about them on the media this morning — but I am keen to understand the pipeline of your contracted work for the remainder of the financial year.

Mr Best: I will hand over to my colleagues, who operate on the ground.

Mr Quigley: In his written notes, Gordon mentioned that there are 23 interim term contracts for asphalt resurfacing (ITCAR) from DFI. They involve most of the guys who are sitting behind me. From a survey that we did, we reckon that all the funding will be spent by about the end of November, barring some dribs and drabs of funding that will come through. A couple of one-off schemes are happening — the Sydenham bypass and McKinstry Road — that are timelined over a specific period, but those sit separately. We reckon that most of the ITCARs will be out of funding by the end of November. That will leave us sitting for four or probably five months with a large number of staff and people and nothing to do.

The Chairperson (Mrs Erskine): OK. What impact might that have on capacity to meet the timescales of programmes for responding to requests for urgent repairs on roads?

Mr Chambers: For urgent repairs, the reality is that, come the end of November, our resources will not be there. We will be laying people off. You cannot expect us to sit about doing nothing, waiting for a phone call. As far as I can see, there are two elements: short-term and long-term. In the short term, there will be immediate job losses. We have apprentices, and we stick to the social clauses in the conditions of contract, but we will have to get rid of all that. We cannot keep apprentices and everyone employed with no work.

The Chairperson (Mrs Erskine): What has been your engagement with DFI officials from a finance perspective?

Mr Best: We deal directly with the TRAM unit headed by Colin Woods, David Porter and Colin Sykes. We have regular quarterly liaison with the Department. It covers the likes of road worker safety, public liability claims levels and procurement. Obviously, as an organisation and a trade body, we lobby to ensure that we have adequate support. The funding is not for us. We are a service industry. Our members have invested tens of millions of pounds in production plants and skills. We have a skilled workforce, and, as the guys said, we cannot just switch that on and off like a tap. If the money is not forthcoming in the October monitoring round to see us through to January — to the next monitoring round — those skilled workers, who have families and mortgages to pay, can see what is coming down the road. Some of them may already have jumped ship. Certainly, in the industry, it would be fair to say that most of the subcontractors are already laid off. We have highlighted that to the Department.

I want to be fair to the Department. I listened to Colin Woods, Colin Sykes and Sian Kerr's presentation to you at the end of February or early March, and most of that presentation was taken up with discussing the resources that they have. You are right, Chair. When you look at any of the reports to councils or any of the further reports to the Committee, you see that one of the big things in that is the resource level and being able to offer only a limited emergency service. However, we cannot ignore the fact that the asset that we have, which is worth £40 billion, as mentioned, has to be maintained. You heard my comments on the radio this morning. The situation is akin to putting an extension on your house when the roof is caving in.

The Chairperson (Mrs Erskine): I am keen to understand when the latest engagement that you had with them was and what they said to you. Did they give you any indication of what funding would be allocated?

Mr Best: Our last liaison meeting was in early September, and, at that stage, it was very much doom and gloom. The comment was made to me that the resource had been "run ragged". They said that a bid would be going in, but they did not know whether it would be successful, given the state of the Executive's finances.

The Chairperson (Mrs Erskine): Did they provide figures?

Mr Best: No.

Mr Chambers: No. There was a comment that, if more money came, there was still a deficit that had to be covered from the previous year.

Mr Quigley: That is another issue for us as well.

Mr Best: Of the £89 million that we have highlighted, £26 million was an overcommitment, and the £12 million that was received in the June monitoring round was used to pay off that £26 million. The Department is still running with a £14 million overdraft.

Mr Quigley: It is our understanding that, whatever moneys become available in the October monitoring round, the first thing that will happen is that the £14 million overdraft will have to be paid off. That is another issue that we need to address with the DFI. The officials did not commit to any figures with us when we last met. It was all very much, "Look, we will put in a bid, see what we get and take it from there".

Mr Best: We have made the case, obviously, that, in other years, they have run with an overcommitment throughout the year, because it is vital to sustain those jobs and the maintenance of the network.

The Chairperson (Mrs Erskine): I will now open the meeting to questions from other members.

Mr Stewart: Gordon, David and Mark, thank you very much for coming along today, and we thank everybody in your network and everyone whom you represent for all the hard work that they do.

You paint a stark picture. I will ask, first, about the exact finance amounts. What is the base-level figure that, you think, is the minimum required to get through to the end of the financial year? Gordon, I accept and totally agree with your point: multi-year Budgets are needed so that we can avoid cliff edges year after year, because it is totally unsustainable.

Mr Best: In the paper, I highlight 2022 as one of the better years, to be honest, with £126 million. That was across the board for all structural maintenance. However, it was still well below the £143 million that is recommended in the Barton report. I mentioned the inflationary pressures of 30%. If we were to stand still, with the 2022 figure for this year, we would need £164 million. We are realistic about the likelihood of getting that. If you worked it out pro rata, you would see that we would need probably an additional £40 million in this monitoring round and an additional £40 million in the January monitoring round just to stand still.

Mr Stewart: The Chair asked about the impact that that will have on urgent repairs, and you talked about it ending in November. What impact will that have on the ground in terms of road safety and urgent repairs post November?

Mr Chambers: It will have a serious impact on road safety, because the resources will not be there to do the repairs and maintain the highways.

Mr Stewart: Absolutely.

Mr Best: We had a good meeting recently with the roads claims unit (RCU) and Declan Coleman. We discussed the processing of claims, looking after the interests of a claimant and, if one of our members is affected, how quickly DFI can get that claim information. I have the figures for claims over the past number of years. Already in 2024-25, as at 16 September, 2,359 claims had been received by RCU. That compares with 5,689 in the previous year and 3,500 in 2022-23. The average referral time is 103 days, compared with 74 days in 2022-23. That illustrates the issue of resources in the Department. It also highlights the clear correlation — I have said this before at the Committee — over the years between the lack of maintenance and increased vehicle damage claims and public liability claims. That is the reality. That is highlighted in the two independent reports as well.

Mr Stewart: There was so much in the presentation that I could ask probably 20 questions. I know how important the financial aspect is, but I will turn quickly to planning and water impacts. Will you talk us through the impact that the capacity issues and the planning system are having on the sector? What changes you would like to see?

Mr Best: There was a lot of rationale for changing the planning system and moving planning to the councils. We were one of the organisations that said, "Well, where you have key specific sectors such as minerals and waste, they need to be held in an expert service". We used to have the minerals unit in the old Department of the Environment (DOE) and then the Department for Regional Development (DRD). We have been making the case that we need a shared service for minerals and waste. As I said, there is an acquired skill set on mineral planning and waste planning. It is similar to how Mid and East Antrim Borough Council, for example, deals with the environmental issues for government and the councils. We would like to see that in planning for minerals and waste. Having talked to planners, I believe that we are getting some traction in that regard. The resource issues also affect the councils. We have made that case.

You could paper the walls of this room with the reports that have been written about the planning system in Northern Ireland. If we implemented the recommendations of the two that have been done most recently — the Northern Ireland Chamber of Commerce and Industry report, which was done in partnership with Turley, and John Irvine's 2019 report on statutory consultees — never mind those in the Audit Office reports that have been done, we could sort out planning in a couple of years. The NI Water issue is a major one. The road maintenance issue has gone under the radar because of the high profile of the NI Water issue. It is impacting on us, as a sector, already. There is a constraint on almost 20,000 homes. That is 1·2 million tons of aggregates and over 100 million concrete blocks, never mind the effect that it has on other suppliers, such as builders' merchants. That is having a massive impact on Northern Ireland's GDP.

We would be happy to come back to talk to you about what we are doing on decarbonisation. We are the key sector in Northern Ireland, certainly for the Department for Infrastructure, in terms of materials and transport, to reduce the carbon footprint of the built environment.

Mr Stewart: You are right. There are so many issues that we could tease out. I will come back if there is time at the end, Chair.

Mr K Buchanan: Thanks, gentlemen, for coming along, and I appreciate the attendance of your colleagues behind you.

I have a few questions. The paper refers to duplication between DFI and industry on sites with utility searches and so on. How big an issue is that, and what is the saving if, collectively, you were part of that and maybe DFI was not? Give me some broad examples.

Mr Quigley: The examples are the scoping and the planning of works. At the minute, you have two sets of individuals who are going to scope and plan works. They meet on site, and they measure up. They decide what they will do and how they will spend the money. That definitely could be rationalised and streamlined at that point.

On the supervision of the works when they are being completed, as Gordon mentioned, all the contractors are CE-marked. We all run independent quality systems. In our view, the contracts are oversupervised at times, and there is no need for the level of supervision. Those resources could be deployed elsewhere on scoping works and getting works ready should money become available.

There is testing and inspection as well. Again, all the contractors go through a rigorous process of testing and inspection. All of those records are readily and easily available and can be made available to DFI at any time, so there is duplication there that could be saved. You are talking about at least a 20% or 30% saving on labour with DFI on resource management.

Mr K Buchanan: How much money does a 20% to 30% saving equate to?

Mr Quigley: You are talking about individuals. It is hard to say a figure. Gordon?

Mr Best: I could not guess a figure, to be honest.

Mr Quigley: It is difficult because we do not really know what DFI costs are.

Mr K Buchanan: In your paper, you touch on areas in the Department that are fit to spend the money. If a bit of money were to come in in October or November, they should be fit to spend it. You are saying that there is a reduction in staff already. Could that be reduced more by you doing more planning of it? Do you know where I am coming from?

Mr Quigley: Yes, I do.

Mr K Buchanan: You have two issues there.

Mr Chambers: Yes, but the issue seems to be at a higher level. I am sure that the paperwork process could be streamlined. It is a very slow process. I will go as far as saying that our receiving payment is way behind and is in breach of contract, in certain areas, every month.

Mr K Buchanan: Have you raised that?

Mr Best: Yes, we have.

Mr Chambers: We have to fill in our subcontractor payment report forms every month to show that we are sticking to the contract and paying on time, but there are times when we are not being paid on time. With the paperwork involved in getting a works order out, it is a slow process.

Mr K Buchanan: Would you say that the Department is not efficient?

Mr Best: In some areas.

Mr Chambers: In some areas, yes.

Mr Quigley: It is difficult to comment directly on that, because we do not know what happens once the information goes into the Department to produce the works order and get that work on the ground. We are not aware of that documentation QA process. The feedback that we get from the guys on the ground is that it is onerous, slow and difficult and could be streamlined, so I imagine that that needs to be looked at, if that helps to answer your question.

Mr Best: There are solutions that we probably do not have the time to go into today. I know that the structure in DFI is being looked at, including the consultancy/client split. It almost now seems that you are dealing with different agencies in the one Department. All of that needs to be looked at. There are the funding models and the amendments to contracts that have needed to be made to help agree it. We are heading towards frameworks in a short time. There will be greater partnership and collaboration there. I have been fortunate enough to judge the Construction Employers Federation (CEF) construction awards over the past number of years. The partnership that NI Water has with its contracts in delivering new water treatment plants and new sewerage schemes is absolutely brilliant. We need to learn from those good practices in government.

Mr K Buchanan: You referred to the pound and the cost increases of 30%: what was £1 in 2022 is now 70p, theoretically. How accurate is that, and can you give me some examples of that — say, for a mile of motorway — that Joe Public can understand? It is a bit like your house analogy

Mr Best: I will let my two colleagues answer, because they will have better knowledge than me. When we did the analysis across energy, plant, wages and materials, the figure was coming in at around 30%.

At our last liaison meeting, David Porter quoted the Barton figure. It was £143 million in 2019-2020. It is now sitting at £190 million.

Mr K Buchanan: Has David said that that is where it needs to be?

Mr Best: Yes. It is in the minutes of our liaison meeting. That is what the Barton figure is now.

Mr K Buchanan: Does he agree with the 30% argument?

Mr Best: He is using that figure of £143 million, with 30% added to it. That is around £190 million. We are fairly confident, and we have finance people in the industry who check those figures.

Mr Dunne: Thank you, gentlemen, for your presentation. Constraints on waste water infrastructure are huge issues that affect the Province now and will affect it even more in the future. I am keen to tease out what contribution the wider construction sector and industry can make to ultimately deliver on solutions to the current constraints.

Mr Best: As you know, the Construction Employers Federation (CEF) very much leads on that. We have supported it by providing information on industry figures and how it affects our sector. It is a bit like what we are talking about here today. We have kicked the can down the road. In 2001, Dermot Nesbitt, as Minister of the Environment, put a moratorium on housebuilding. Where have we come since then? We have made no progress.

Leaving aside the funding issue, the Government and the construction and development industry need to work together to sort it out, because the social, economic and environmental implications for society and the economy are huge. Failure is not an option. We have to sort it out.

Mr Dunne: I agree with your assessment of that. Linked to that, do you feel that the Department and the Minister recognise the scale of the challenge and the impact of what is coming down the tracks?

Mr Best: On the basis of the correspondence that I have been involved in and discussions that we have had at the all-party group on construction, I think that the Minister is well aware of it. We — I mean the industry and others — may not agree with the Minister on the way forward in many cases, but, when I listened to his speech at the CEF excellence awards, I detected something that was very much about the need to take a partnership approach between government, the Minister, the Department, NI Water and the industry to sort it out. As I said, we are a supplier, and it will have massive implications for us.

Mr Dunne: I turn to road maintenance, which is another important issue. A total of £30 million was spent on road claims over the past five years alone, which backs up the concern about the need for ongoing maintenance as well as for new roads. The intervention level was changed to 50 millimetres from 20 millimetres a number of years ago, which was a limited service. What impact would reverting to an intervention level of 20 millimetres have?

Mr Quigley: I will go back to what David said. Over double the amount of resources would be required to deal with that. We need certainty about the funding to make sure that we have the resources in place so that we can deal with that. Unfortunately, if that happens, it will probably be a matter of getting a phone call or email overnight to say, "We are changing our service level". That will be difficult. Unless we can maintain the level of resource that we have at the moment through the next six or eight months, it will be difficult to just switch things on to manage that.

Mr Dunne: I appreciate that. Your tap analogy was pretty accurate.

Finally, I turn to the impact of the A5 scheme, which will cost over £2 billion. The officials were at the Committee last week. What impact will the cost of that scheme have on your sector?

Mr Best: I am a close friend of Stephen Kelly. Most of you know Stephen. He lost his father on the A5, and there are people in the industry whose relatives have lost their life on that road. The scheme is long overdue. We certainly welcome it. However, I made the point on the radio this morning that we need to ensure that we manage and maintain the existing network.

We do not have time for this discussion today, but we need to look at the funding models. How can we be expected to take a big project like that or like the Enniskillen bypass out of the block Budget? It is the same as the issue with NI Water. If each of us in the room is going to buy a house, we will get a mortgage and pay that mortgage on it. We need to think outside the box about how we fund road maintenance. Do we introduce road tolls? We have all travelled to Dublin and have gone through two or three road tolls when doing so. There are congestion charges. That all has to be on the table. I do not support any particular measure, but we have to open up the wider discussion about how we fund road maintenance; that is clear. We have the reputation in this place of not being able to build anything, and now we are getting the reputation of not being able to maintain anything. If we are to support our economy and encourage inward investors into this place that we all call "home", we need to start making difficult decisions.

Mr Dunne: OK. Thank you.

Mr McReynolds: Thank you, gentlemen, for coming in today. You have just touched on the question that I was going to ask. Multi-annual budgeting was meant to come in, but, unfortunately, the Assembly collapsed. You acknowledged that the Executive have a desire to put that back on the table and get it introduced. What are the solutions until then? Do we just hope that we will get more money from the Minister? What creative solutions do you guys bring to the table?

Mr Best: That is a good question, Peter. I wish that the decision on funding was in our gift, but it is not. It is not even in the gift of the Committee. At the end of the day, we have to identify the main priorities. We certainly see the maintenance of our largest asset as a key priority. This is our message to the Executive, particularly the Department of Finance: ensure that we get adequate funding. That might not be along the lines of what Barton suggested, but we need the funding that is necessary to keep the roads network in a safe and high-quality condition. At the end of the day, we will just kick the can down the road, and there will be higher costs and more pressure on public finances.

Mr McReynolds: I agree with that point, and that leads on nicely to my next question. Maybe there is not a recognition of the importance of our major asset, which is the roads. People sometimes forget about that. Over the past number of weeks and months, we have all been discussing Northern Ireland Water and the impact that its lack of capacity has on homes — "no drains, no cranes" — businesses, education and care homes, with the ageing population. The impact that it has on your members has not been considered or talked about as widely. Is there anything that you want to get on the record today about the impact that Northern Ireland Water's lack of capacity for connections has on your members specifically?

Mr Best: On the NI Water issue?

Mr McReynolds: Yes.

Mr Best: As I said, we have submitted evidence on the effect on materials production, whether that be of concrete roof tiles, ready-mixed concrete for foundations, concrete blocks or aggregates etc. It is absolutely huge. The other thing, which, I think, Seamus Leheny of the Northern Ireland Federation of Housing Associations highlighted, is that we need to learn the lessons of Dublin. With the housing constraint, we will create housing pressure, which will put prices up and create a problem for young, first-time buyers in getting mortgages. That means that the people whom we expect to go out at weekends and spend money on hospitality etc will not have the money to do that because they will be paying higher mortgages.

We are now sitting with 32 towns around the country that are constrained in planning development for housing. The ripple effect of that on not just our construction materials sector — I mean the likes of CEF members — but the wider economy is absolutely enormous.

Mr McReynolds: As a brief supplementary — this just came into my head — the Minister recently made an announcement about developers' contributions. Do you guys have any thoughts on that approach?

Mr Best: We are not developers. Anything that meets the need for social housing — our members are very aware of the people on housing waiting lists — and addresses that is a good thing for wider society.

Mr McMurray: Thank you for coming along. I noticed that your briefing paper refers to the circular economy and decarbonisation, so I will ask two questions about that. First, how circular is the mineral products industry?

Mr Best: I will give you a few examples. At the minute, we are involved in a number of collaborative networks. We are partners in the Industrial Decarbonisation for Northern Ireland (IDNI) project, which is funded by Innovate UK and led by Invest NI. We are also involved in a collaborative network with Queen's University Belfast (QUB) and the Agri-Food and Biosciences Institute (AFBI) food science lab in Hillsborough that is looking at the use of biochar and concrete. The results of that are very positive. Biochar is the ash that is left after the biomass process. We are also involved in a biomethane collaborative network in mid-Ulster between Cemcore, Tobermore concrete and the farmers' cooperative Dale Farm.

The biomethane question is absolutely enormous for our sector; in fact, we have chatted to DFI about it. We have 24 asphalt plants in Northern Ireland. About three quarters or two thirds of those are connected to the gas network. By introducing biomethane or, in the even longer term, hydrogen gas into the network we could immediately decarbonise the production of asphalt and the materials that we supply to DFI.

As for our sites, we are the largest landowner outside agriculture. There is a huge resource of wind and water. The electrolyser technology and the energy storage technology are moving at a quick pace. We have the potential to become off-grid and generate our own renewable energy, either through solar or green hydrogen, that we can use in the manufacture of our products and in transport. We are the largest transport sector by weight in the economy. We move something like 80,000 tons a day. We have huge potential.

On the circular economy, the likes of CDE Global in mid-Ulster has developed, through the technology, washing and screening. We are now washing dust, which was previously viewed as waste in the industry, in order to create a sand that can be used in concrete, negating the need for more applications for sand and gravel sites. Those are just some of the examples.

Mr Chambers: Just on that, Gordon, all those budget problems take investment. How can we invest when we have no work? It has a knock-on effect on all that. You are looking at a business model. At the minute, we have no work come November. Yet we are being expected to invest to decarbonise all that sort of stuff.

Mr Best: It is important to recognise the roads issue. My electric car runs on the road. Cyclists also use the roads. That is why I made the point about active travel. It will all have a knock-on effect. It will affect some of the Executive's Programme for Government objectives on active travel. I received an email last night from a cyclist. I cannot read it out, because he made some strong comments about the Department, but I am happy to share it privately with a number of you. It is a real concern. Anybody in the room who is a cyclist knows that, if you divert around a pothole, you risk being hit by oncoming traffic. That is a real, live concern out there.

The Chairperson (Mrs Erskine): Is that OK?

Mr McMurray: Yes, you covered both questions. Thank you very much.

The Chairperson (Mrs Erskine): The Committee got evidence from the likes of the Motorcycle Action Group (MAG), which mentioned those facts. All of us in the room are not immune; we all travel on the roads.

Mr Baker: Thank you for your presentation and the information that you provided in your paper. It is very informative. Most of what I was going to ask has been covered.

I would like to go back to the concerns about people losing their jobs. Are there options for members to diversify to ensure that their jobs remain viable? If so, what challenges will that bring?

Mr Chambers: This is our bread and butter: that is the best way to put it. If we do not have our bread and butter, I do not see how diversifying can be a long-term thing. There are short-term and long-term issues to consider. Short term, we are on the edge of a cliff and we have a couple of months to go. In the long term, that will affect our ability to even attract anybody into the industry. The parents of young people at home will say, "Why would you want to go into that industry? There is no consistency there. It's unpredictable. You want to go down a different path". You are talking about decarbonisation. The long-term effect of the situation is as critical as the short-term effect.

Mr Best: In the road maintenance sector, we have 30 to 35 apprentices. The value of the longer-term three-year Budget is that the funding is in place to take the apprentice through the scheme, with better planning and delivery of work and more focus on health and safety. Hopefully, you received a copy of our industry journal, 'Diversity, Decarbonisation, Digitisation'. On the diversity piece, our sector traditionally had an all-male workforce, but we are making positive strides with our women in minerals group. We are doing a lot of things, but, as the guys said, it will all take sustainable work and funding.

Mr Durkan: Thank you for coming, gents. As the Chair said, you have given a stark picture, and I will go further and say that it is a scary one. Things are clearly bad now, but the forecast is even worse. There seems to be a perfect storm brewing, with huge negative implications for your industry, for the wider economy and for society as a whole.

Every Department and sector would like there to be multi-annual budgets, so would even an annual budget be a big improvement for you guys because of the reliance that DFI Roads in particular has had on monitoring rounds over the years? If you had more certainty at the start of each financial year, would that help?

Mr Best: Yes, 100%. The Department has always acknowledged the benefit of front-loading the budget and of getting an indicative budget that is as high as possible in April. The money can be allocated and the work done through the summer when there are longer days and better light, which gives a higher level of health and safety and a better job.

When I worked in the industry, it was the time of the mad days from January to March, when all the accrued money that Departments had not spent was released and there was a big influx into roads and you were putting your life in your hands because of traffic management. Nowadays, it is much better. Thankfully, that is not the case now, but, for a number of years, things were starting to make progress. I highlighted the fact that there was £126 million in 2022, and that was a fairly good year.

This subject just goes round and round. We need to grasp the nettle. One of the ways that we can do that is through multi-year budgets, but, again, that comes down to comprehensive spending reviews in London etc.

Mr Quigley: One of the points to note is that, when we tender for the schemes, we are required to hit a minimum level of resource to tender and subsequently be awarded those projects, schemes or contracts. We have to carry that resource and expect a phone call without the certainty of budgets every year. That is a difficult thing for us to do. Over the past two or three years, it has been very difficult. We are going for long periods in-year with no funding.

You talked about finding innovative solutions to diversify, but we are already doing that because we have to: we have been forced into doing it. We are now at the point where we have nowhere to go. If we do not get some certainty about funding going forward, there will almost certainly be job losses in November and coming up to Christmas. I cannot overemphasise that.

Mr Durkan: How is the industry bearing up in other jurisdictions? Are the challenges here particularly pronounced? The Northern Ireland Water issue is more specific to here, but the streets seem to be paved with gold in the South at the minute. Across the water, has the industry faced similar challenges?

Mr Best: There has been growth in construction across the water. One fortunate thing that we had — it saw us through the recession in 2011-12 — was the importance of our precast concrete. The three largest precast concrete manufacturers in the UK are based in Northern Ireland. We all know that the south-east of England never really experienced the recession, so those companies helped to keep the small family-run businesses and the sand and gravel quarries in the likes of mid-Ulster and other places across the Province going.

At the minute, anyone who is public sector-facing is in difficulty. The economy is doing well here — our sector, as a supply sector, is steady — but that certainly does not apply to the fears that have been articulated here today.

Mr Durkan: We are exporting not just the product but the workers, especially if there is no certainty.

Mr Best: Exactly. As you said, Mark, the South has a €10 billion surplus. We work closely with the Irish Concrete Federation, and things are fairly buoyant down there.

Mr Durkan: You outlined how you engage in regular conversations with officials. Have you had direct contact with the Minister or sat down with him on the issue?

Mr Best: I said in my paper that, over the past couple of years, two permanent secretaries have visited a couple of our plants and sites. They have seen for themselves the tens of millions of pounds that go into resources, the quality control and the skills that we, as an industry, have to deliver for DFI. We had the Minister out on the M2 Ballymena bypass a number of months ago, where he saw for himself the investment in rollers, spreaders and quality control. He got talking to a couple of apprentices who were on that job.

We extend an invitation to the Committee to visit one of our sites at a time that is convenient so that you see for yourselves and appreciate the investment that is being made. We are not pleading for our money; we are a service industry. We do it for the Department, for the taxpayer and for us all to maintain our road network.

The Chairperson (Mrs Erskine): Thank you. Mark, are you content?

Mr Durkan: I do not want —

The Chairperson (Mrs Erskine): Very briefly.

Mr Durkan: — to teach my granny how to suck eggs, but I am sure that it is not just the Department for Infrastructure or the Minister for Infrastructure that is in your sights, given the huge ramifications for wider society.

Mr Best: It is across the board and includes Economy and Finance.

The Chairperson (Mrs Erskine): I will pick up on a point that came up during Keith's questioning: the duplication in inspection and testing regimes. What procedural or legislative requirements are there for DFI to specifically carry out such searches, supervision, inspections or testing? What if you were to do away with that, for example?

Mr Quigley: I do not believe that there are any legislative requirements for site inspections or testing. Once the system generates the works orders and gets the works on to the ground, they have to go through a design and evaluation process. That is where the legislative and statutory processes sit. We are not party to that at the moment, so we cannot really comment on what savings could be made in that area, but, on the ground, there is significant overlap in supervision, testing, inspection etc.

The Chairperson (Mrs Erskine): Deputy Chair, do you want to ask one brief question?

Mr Stewart: Yes, briefly. It is quite niche. It is about potential frustrations due to the different approaches of divisional areas in DFI. Are there cases where you see something working in one division but not in another? Are there discrepancies or variations, and are there frustrations with that approach? If so, what are they?

Mr Chambers: There are differences. There are certain areas that have spent very little money, and there are other areas that have said, "We're not taking any more money". However, those are two different things. It comes down to resource. One of our biggest concerns is that there does not seem to be a concern from the DFI staff. There does not seem to be an urgency with them. We have not come across that before. That is concerning.

Mr Quigley: It is very concerning.

Mr Stewart: So that is a change in attitude. Why do you sense that?

Mr Chambers: I do not know whether they feel that they are overworked or whether they are closing ranks. I cannot answer that question; I do not know, but that is the way in which it comes across.

Mr Quigley: Our feeling was that their processes and procedures were slow and laborious, which is a source of frustration for them. They know what they want to do, but getting from A to B and getting that work to us to complete is a slow and laborious process. It is frustrating for some of them. That is the feedback that we get.

Mr Stewart: That and David's point are concerning. Do you get a sense that the staff in those divisions grasp the severity of the issue that is coming down the road at the end of November — the cliff edge for road maintenance funding?

Mr Chambers: They definitely do, but there does not seem to be any concern. We have sat down at our monthly meetings, as I am sure everybody has, to try to come up with solutions, but you are faced with them saying, "No, this is the way that we are doing it", and that is it.

Mr Stewart: Thank you.

The Chairperson (Mrs Erskine): Do you think that, even if we had all that money, with the best will in the world we might not have the people and the boots on the ground to do the work? The rate of vacancies in road asset management in DFI sits at 28%. Is that part of their consideration?

Mr Best: I have said on a number of occasions and to various people, including MLAs, that, 10 to 15 years ago, roads was viewed as being the area into which the unspent money could be jettisoned. That was because we could spend money quickly, particularly in the last period of the financial year. That is no longer the case. People used to question the capacity of the industry. There is no industry capacity issue. The capacity issue and concern now is that, if we get the required investment, the Department will not have the resources to deliver.

Mr Chambers: As an example, the minor works contracts have not run for some time, but there are teams dedicated to them. We have asked, "What are those staff doing? Why can you not pull them across to resurfacing?" — I think that Mark has made the same suggestion — and the answer has been, "Oh, they wouldn't want to come across". That would not wash in the private sector.

Mr Quigley: Some contracts have spent their budget and others have not. We have asked repeatedly whether staff could be moved around the Province to address the staffing shortfall in some areas and get those budgets spent, and we have got the same response. In private industry, it would be done overnight.

The Chairperson (Mrs Erskine): OK. Thank you for giving evidence to the Committee; we appreciate it. It is timely, because next we will be taking evidence from departmental officials on the Budget and the October monitoring round. We appreciate you giving your time.