Hot Topics 2024 Flashcards
Please explain your understanding of the recent updates to RICS
Professional Indemnity Insurance Cover around Fire Safety?
- During 2019 fire safety insurance cover was removed from the professional indemnity insurance market following the Grenfell Disaster;
- This followed an increase in insurance claims with insurers applying blanket fire safety exclusions;
- Many surveying firms were unable to obtain fire safety cover leaving them exposed on previously completed instructions and non protected for future work;
- During 2020/21 the RICS worked with insurers to restrict blanket fire safety exclusions;
- The RICS agreed with insurers in May 2021 that fire safety exclusions could be used however these would not apply to work on properties with four or fewer storeys above ground level;
- This is contained in the agreement that all insurers sign if they want to participate in the RICS insurance market;
- Cover for completion of EWS1 forms remains excluded from RICS’ policy wording;
- There is limited protection for professionals completing EWS1 assessments on a case-by-case basis at insurers’ commercial discretion.
What are your views on the Pro’s and Con’s of Hybrid Working?
Advantages:
- Improved work-life balance;
- Greater ability to focus with fewer distractions;
- Saved commuting time and cost;
- Savings on office space;
- Higher levels of employee satisfaction.
Disadvantages:
- Loss of social connection;
- Reduced collaboration;
- Productivity can be dependent on quality of workspace;
- Less recognition;
- Risk of burnout.
What is the RICS doing to improve Diversity & Inclusion?
- The RICS has setup ‘Diversity & Inclusion leadership’ which is a knowledge hub allowing the RICS to share ideas on how and why diversity & inclusion is so important to the RICS.
- This has included initiatives such as:
- International Women’s Days celebrating the achievement of Women in our profession;
- Pride 2023: LGBTQ+ equality pledge focusing on the importance of LGBTQ+
representation in the profession; - The McGregor-Smith Review – aiming to develop black and ethnic minority talent
within the profession.
Please explain your understanding of how the RICS define Professional Standards vs. Practice Information?
- Following the Bichard Review and its recommendations the RICS have introduced two new definitions for Professional guidance which are now split into Professional Standards and Practice Information;
- These supersede the former definitions including Professional Statements, Guidance Notes and Codes of Practice etc;
- Professional Standards - set out requirements or expectations for RICS members and regulated firms with a focus on baseline expectations for competence and ethical behaviour. They contain mandatory requirements that surveyors must follow, where the word ‘must’ is used with best practice that surveyors should follow, where the word ‘should’ is used;
- Practice Information – set out supporting guidance to advise surveyors in delivering specific services or working in specific areas of practice. The guidance is not mandatory and does not provide explicit recommendations. Practice Information can refer to processes, toolkits, checklists, insights, research and technical information or advice.
How has Brexit effected the UK Property & Construction industry?
Movement of Personnel;
- Movement of people is now restricted with free movement having ended on 31st December 2020 and from 1st January 2021 the UK has a new global immigration system;
- Employers are now required to register as sponsors in order to recruit from abroad;
- To employ someone from outside the UK the individual must meet job, salary and language requirements;
- With the supply of labour being more restricted this has led to labour cost increases and a reduction in the availability of labour.
Movement of materials:
- Under the UK’s new trade agreement with the EU, most traders will not have to pay tariffs when moving goods between across borders but will have to meet relevant Rules of Origin for their products;
- The price of goods moving across the border is expected to increase due to the additional border checks and administrative work;
- The implementation of this agreement has lead to material shortages and price increases but is not expected to have a long-term effect.
Material Cost Increases:
- Despite cross border tariffs not being introduced, the additional administrative work and checks in my experience are slowing down the supply of labour and materials;
- This has subsequently resulted in cost increases and availability issues in particular in the cost of:-
- Steel;
- Plastic components;
- Cement;
- Plasterboard;
- Skilled and non-skilled labour.
Are you aware of any RICS guidance notes on Brexit?
- The RICS has provided a number of position statements highlighting its concerns and issues with Brexit on a sector-by-sector basis;
- This also outline what the RICS think the UK government should be doing to make Brexit work for a post-EU UK;
- The position statement highlights:
- Encouragement of growth and diversity of the construction workforce as potential loss of non UK works could create significant issues as this currently account for 12.6% of workers;
- EU membership provides access to a number of EU funding streams such as the European Investment Bank (EIB). The loss of EU led funding streams could have a significant impact on project delivery in the UK;
- The RICS is calling for the UK Government to act to keep EIB funding or introduce a new lending mechanism, to plug the gap which could result in a lack of infrastructure investment.
What is COP26?
- COP26 is the most recent annual UN climate change conference. COP stands for Conference of the Parties, and the summit was attended by the countries that signed the United Nations Framework Convention on Climate Change (UNFCCC) – a treaty that came into force in 1994;
- The two-week meeting was seen as a critical moment for commitments and action after richer nations had failed to raise the $100bn annual climate funding they had promised to vulnerable countries and the gap to staying below 1.5C loomed large.
- Explicit plan to reduce use of coal which is responsible for 40% of annual CO2 emissions.
- Agreement pledged to increase money to help developing countries cope with effects of climate change and switch to clean energy.
Please explain your understanding of happened at COP27?
- COP27 took place in Sharm El Sheikh, Egypt and highlighted the countries mostly affected by ‘loss and damage’ of extreme weather;
- A new loss and damage fund was agreed for the first time where richer countries that have still not delivered on previously agreed targets will be required to provide $100bn per year to the countries most in need;
- There was a large focus on paying for the damage caused by climate change however many delegates thought that not enough emphasis on mitigation strategies were discussed;
- Key targets such as ensuring that carbon emissions peak before 2025 and the phasedown of fossil fuels did not form part of the agreed text which was seen by many leaders as a failure.
What affect has the conflict in Ukraine had on the UK Property &
Construction industry?
- Due to the high dependency that Europe has on Russian gas and oil, the conflict in Ukraine has resulted in significant energy price increases;
- This means the cost of production of building products that require high energy input have also increased including:-
- Steel;
- Bricks;
- Plastics;
- Ceramics.
- In summary the conflict in Ukraine has intensified an already turbulent market that was previously effected by Brexit, Covid-19, Industrial strike action, rising energy and fuel costs and inflationary pressures;
- Impacts may also include delay and disruption caused by materials and goods shortages affecting deliveries, cost overruns and possible arguments around the triggering of suspension or even termination rights.
What is the RICS current business plan for 2024?
- Governing council discussed the 2024 business plan and implementing the new RICS strategy;
- Focus on improving candidate experience and doing more research on ‘sleeper’ candidates;
- Focus on top 20 global employers and on establishing the Matrics network;
- Focus on public sector, SMEs and recruiting assessors in the UK and Ireland;
- New commercial strategy to drive more investment into services for members;
- Technology roadmap report to set out costs and benefits of a proposed transformation plan that will reduce costs from 2025 as well as delivering improvements to the member experience from first quarter 2024;
- Improving APC candidate experience as priority;
- 2024 budget is approved.
