Friday18 August 2017

Now it’s clear that the fee situation is out of control

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Sanctuary’s fee terms mark a low point in the value housing associations put on design

Amanda Baillieu

Amanda Baillieu — editor in chief

Architects interested in driving up the quality of new housing are wondering if the move to simplify the rules imposed on developers will bear fruit. It may do, but in the meantime there’s a more pressing concern that arguably has had as much impact on driving down standards — and that’s the fee levels offered by housing associations.

Social housing has never paid well. Typically fees on offer hover around 4.5%. Despite this, architects continue to produce interesting work — most recently Mae at New Islington and Haworth Tompkins’ Peabody housing in Pimlico. The bigger picture is less rosy. At last count, most schemes in the affordable sector were rated as “average”.

Why this continues to be the case is hotly debated. Bottom drawers are stuffed with reports on this subject. Yet, even before public expenditure cuts led to a seismic shift in the way housing associations operate, quality has always been in short supply.

But the finger of blame is never pointed at fees. In the absence of a mandatory fee scale and with the general lack of work it’s accepted that architects will work for almost nothing.

The situation is now out of control. Some might argue it has been for a long time. Nil fee bids are nothing new. But the terms offered by Sanctuary — one of the biggest housing associations — to pay architects nothing in the event a scheme doesn’t go ahead and just 1.9% if it does, suggest the situation is about to get a whole lot worse.

If other housing providers follow, more practices will go under. And the impact on housing quality will be palpable: even the saintliest professional will be unable to do other than settle for the cheapest, simplest solution.

Angela Brady is right that Sanctuary’s odious framework needs to be boycotted. But to make a difference, the RIBA needs to put fees — or lack of them — back on the agenda.


Readers' comments (6)

  • SomeoneStoleMyNick

    The best social housing was produced when local authorities had their own architects' departments and fee scales did not apply because the architects were employed. I think there's a correlation.

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  • They'll get the standard of housing they deserve because to do it for that fee, the work will be moved down the food chain to the tea boy. As usual, they just don't get the distinction between cost and value. I smell accountants!

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  • "But the finger of blame is never pointed at fees. In the absence of a mandatory fee scale and with the general lack of work it’s accepted that architects will work for almost nothing.

    The situation is now out of control."

    Is there actually a solution to this though? I thought that mandatory fee scales were abolished due to competition law?

    This makes for interesting reading:

    In particular this quote on page 8 is pretty damning.
    "Mandatory fee scales have generally been considered by the OFT and the Monopolies and Mergers Commission to be significant restrictions on competition that are manifestly contrary to the public interest. Advisory fee scales, where charges are objectively determined and reflect changing market conditions and the parties are free to negotiate, may in some circumstances be acceptable, but these conditions are hard to satisfy."

    I would argue that in the current market and especially in light of Sanctuary's fee terms that reintroducing minimum fee scales are in the publics best interest for certain types of work as I can't see how you could ever possibly provide a full professional service for 1.9%. However I'm only a new graduate and obviously biased.

    Is there anything other than reintroducing mandatory fee scales that could be done?

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  • Withholding service by reputable Architects is one other avenue.

    The RIBA and Arb could and should strike off practices who undertake work while not being properly able to possibly service these projects in a professional manner. From experience Architects are not easily replaced despite what all the quasi design crew project manager types often loudly say.

    The Architects involved must be treated with hard love for the sake of the profession as a whole. The profession must make a stand and I believe it has come to the point where there is no other option.

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  • I read the report Ezwatts pointed to, missed it before. As a whole it reflects the nature of the authors, as well as having a sub-text which I read as using the Building Trades model (no qualifications/skills necessary, only low prices) to dismantle professional services. It is old, but I doubt forgotten by those who "matter".

    I would prefer not to be bound by a rule that said I must charge a "realistic" rate - definitely unreasonable restraint of trade.

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  • Mike Duriez

    The problem is underpinned by just too many architects. Those fulfilling a traditional role are particularly squeezed.

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