The impact of Brexit on Facilities Management

Today marks a historic day, the prime minister, Theresa May has triggered article 50, beginning a two year process that will result in the UK leaving the European Union, an institution we have been part of for 44 years. There has been much discussion about what this means, politically and socially, for the UK, but what does it mean for facilities management? We’ve undertaken some detective work to find out for you.

Money

Most experts and analysists agree, the initial financial impact of a ‘hard’ Brexit is likely to be tough, with some experts predicting that the UK may face losses of around £4.5 billion per year. Brexit may result in a reduction in business investment within the UK, so we may see fewer available facilities management projects, or more financially restrained ones.

Pre-existing projects may face a renegotiation of contracts or a readjustment of costs and funding. This may result in a pushback or build-up of projects, whilst the logistics are hammered out and fine-tuned.

 

Of course, some politicians argue that leaving the EU will be beneficial financially for the UK, as they state it will allow us greater negotiation power with non EU countries such as China and America. However, around 50% of the UK’s exports go to EU countries, and we do risk losing our negotiating power with these countries, especially as the costs of tariffs look set to rise.

Labour

A hot topic of debate during the Brexit vote was free movement of labour. In 2016, there were 2.2 million EU workers in the UK, many of them working within facilities and the construction industry. If the government pursue a ‘hard Brexit’, the movement of free labour between the UK and EU countries may be stopped or limited. This may result in a lack of available labour, wage inflation, and increased costs within facilities management.

 The environment

In recent years, facilities managers have become increasingly concerned about the environment, and the impact that our projects have upon it. In the UK today, many of our legislations and rules surrounding environmental protection and conservation originate from EU directions. This has allowed harmonisation of compliance frameworks across the EU. The EU’s environmental legislation addresses issues such as; acid rain, the thinning of the ozone layer, air quality, waste and water pollution, noise pollution, and sustainable energy. The Institute for European Environmental Policy estimates the body of EU environmental law amounts to well over 500 directives, regulations and decisions.

There are concerns that once we have left the EU, the UK government may adjust or reduce these items of legislation, which will have a knock on effect on construction and maintenance.

 The future

Nobody knows exactly what Brexit will mean for facilities management, or indeed, for the country. However, we will watch closely over the coming months and years, and seek to react accordingly.