Persimmon blames labour and material costs for 10% drop in completions

Persimmon, one of Britain’s biggest housebuilders, said shortages of materials and labour contributed to a 10% drop in the number of homes built in the first half of the year.

Julia Kollewe 

The company completed 6,652 homes in the first six months of 2022, down from 7,406 a year earlier. It blamed further delays in the planning system, as well as material and labour shortages. Customer inquiry levels were healthy and cancellation rates low, Persimmon said.

Prices for key materials such as timber and steel have rocketed since Russia invaded Ukraine in late February. Bricks and blocks have been in short supply, along with windows and boilers at times, according to Dean Finch, the Persimmon chief executive, while labour shortages – for example plasterers – have had a bigger effect, forcing the company to pay workers more.

Soaring raw material prices, shipping and energy costs, coupled with higher wages, have hit builders across the sector, in particular smaller firms. More than 3,400 smaller construction businesses, many of which are family-run, went into administration in the year to April, the highest number since the financial crisis, according to the Office for National Statistics.

Persimmon shares fell 5.5% on Thursday morning, making it the second biggest faller on the FTSE 100.

Total revenues in the first half fell 8% to £1.7bn, while forward sales were slightly higher than this time last year at £1.87bn.

The housebuilder, which has sought to rebuild its reputation after a damaging scandal over poorly built homes and a public backlash against its former boss Jeff Fairburn’s £75m bonus, expects to complete 14,500 to 15,000 homes in 2022, compared with 14,551 last year.

The firm said first-half profits would be slightly higher than expected because house price inflation has offset rises in build costs. Its average selling price increased by 4% year on year to £245,600 in the first half, reflecting strong demand and a reduction in the proportion of homes sold to its housing association partners.

The UK housing market has defied expectations of a slowdown so far, with prices rising at the fastest annual rate in 18 years last month, according to Halifax, one of the country’s biggest mortgage lenders. Experts are expecting the market to cool in coming months, however, as the cost of living squeeze and higher interest rates affect people’s ability to buy.

Finch said: “Delays in the planning system, disruption in material supply chains and challenges in securing labour have impacted completions in the period. We anticipate, however, profit at the half year to be modestly above our expectations reflecting strong demand and positive pricing conditions. Our forward sales position is robust.”

UK housebuilding declined in June for the first time in two years, an industry survey showed this week. The housing market has been surprisingly strong throughout the Covid-19 pandemic, fuelled by the government’s temporary stamp duty cut and people’s desire to move to larger homes and greener surroundings amid a rise in home working.

What we have all been thinking…

From a correspondent (including the suggested editorial comment):

Of all the guilty men and women in the dismal reign of Boris Johnson, the British right-wing press bears heavy responsibility for what the country has become. From the self-lacerating Brexit referendum to the elevation of a man they knew to be unfit, they set the pace, at the behest of extreme Brexiteer press barons – MurdochRothermereBarclay foghorns still dominate the political landscape. In this sleazy Johnson era, so often the Guardian [and East Devon’s Owl – ed.] has been foremost among those puncturing this mendacity.

“Levelling-up” the Johnson way

The full extent of the notorious Wallpapergate scandal seen by some as heralding the start of Boris Johnson’s downfall has been laid bare.

Will the next Conservative choice of Prime Minister live with the decor or will the long suffering taxpayer have to fork out for yet another refurbishment? (Some of the likely candidates are rich enough to pay for a refurbishment on this scale out of small change) – Owl

Estimate for PM’s renovation plan included £7k rug and £3,675 trolley

Simon Walters 

The Independent has obtained a leaked copy of the estimate for the renovation of the prime minister’s Downing Street flat which totals more than £200,000.

Items suggested for Mr Johnson and wife Carrie by upmarket interior designer Lulu Lytle include a £3,675 drinks trolley said to be like the one owned in Paris by ballet dancer Rudolph Nureyev and £2,260 worth of the “gold” wallpaper that Mr Johnson privately complained his wife had purchased.

Two sofas were priced at more than £15,000; £3,000 was considered for a “paint effect” for the flat hallway; and the cheapest item is a £500 kitchen table cloth.

The estimate for building works, which involved sanding the floorboards, painting and decorating, and installing new furnishings and fittings came to £30,000.

The leak from the Cabinet Office will reopen the long-running controversy over the Johnsons’ luxury refurbishment of their flat over at 11 Downing Street.

The £208,104 estimate was sent to the Cabinet Office in early 2020, which has a £30,000 annual budget to renovate the PM’s official Downing St flat, in the early stages of the work.

In fact, the rest of the cost was secretly funded by Lord Brownlow and the Conservative Party until the scandal was uncovered and Mr Johnson was told to pay it from his own funds.

The leaked bill shows that the Johnsons ordered a £3,675 “Nureyev Trolley” said to be “inspired by a French 1940s drinks trolley owned by ballet dancer Rudolph Nureyev”.

The leaked estimate in full:

(The Independent)

(The Independent)

(The Independent)

The Johnsons were invited to spend £15,120 on two sofas (with another £2,880 for fabric to upholster them); £11,280 on eight dining chairs; £7,000 on a rug; £4,200 on a “double wingback chair”; £3,800 on an antique mirror for the hall and £1,000 for a kitchen TV table.

The leaked estimate from Ms Lytle’s Soane Britain company lists a drawing-room lamp for £6,000 with an extra £2,500 for the lamp shade.

Despite being known as Wallpapergate, in fact, the fabrics would have cost far more than the wall hangings.

On the wallpaper front, the single most expensive item was £2,260 for 10 rolls of “Espalier Square design” for the entrance hall.

According to the Soane Britain website Ms Lytle “imagines this gives the all-encompassing effect of fruit trees to form tunnels and pergolas in a 19th-century kitchen garden”.

Although described as “emerald and stone linen” in colour the “Espalier” wallpaper can appear to be gold in a certain light and is said to have inspired Mr Johnson’s frustrated remark that his wife was “spending thousands on gold wallpaper”.

The estimate for upholstery and curtains came to £21,280, including £3,200 for “32m of sorolla red scrolling fern” for dining room curtains.

It is not known which items the Johnsons ultimately chose for their home.

Mr Johnson was then forced to apologise in January for failing to disclose to his former Whitehall ethics adviser Lord Geidt messages between himself and Lord Brownlow, who contributed more than £50,000 towards the flat makeover.

In his report into the flat refurbishment in May 2021, Lord Geidt said Johnson told him he did not know Lord Brownlow paid the money before media reports earlier that year.

However, a separate inquiry by the Electoral Commission watchdog found out that Mr Johnson had in fact messaged Lord Brownlow over WhatsApp about the revamp in November 2020.

Lord Geidt, who resigned from his post last month, rebuked the prime minister for failing to disclose the texts, but did not change his initial verdict that Mr Johnson did not break the ministerial code.

In 2021 it emerged that the cost of the refurbishment was met by the Cabinet Office and recharged to the Conservative Party. After the scandal was revealed the money was returned to Tory HQ and Mr Johnson agreed to pick up the bill, though it is not clear where he obtained the necessary balance once the Cabinet Office paid its £30,000 share.

Chris Pincher: Councillor ‘told to hold grope allegation’

A councillor who says he was groped by former deputy chief whip Chris Pincher, says he was told by a colleague to hold off talking about it after instruction from Conservative headquarters.

“The wall of silence” – Owl

BBC News 

Daniel Cook said Mr Pincher, MP for Tamworth in Staffordshire, groped him in 2005 and 2006 which the BBC understands he denies.

But Mr Cook said the instruction led him to speak out about what happened.

The BBC has contacted national and local Conservative parties.

Tamworth Conservative Association and Conservative Campaign Headquarters (CCHQ) was contacted on Friday afternoon and has yet to respond.

The BBC understands Mr Pincher strongly denies any such conduct relating to Mr Cook.

Prime Minister Boris Johnson then faced questions from his party about what he knew and his handling of the allegations. which led to him apologising for appointing him, admitting he had been made aware of a complaint in 2019.

Mr Pincher is facing a string of claims of inappropriate behaviour stretching back several years, which he has denied.

He has now spoken to BBC West Midlands political editor Elizabeth Glinka, again waiving his right to anonymity.

He said the incidents happened at his home when Mr Pincher, drunk on both occasions, knocked at his door.

Mr Pincher “groped his penis and said have you got any good porn”, Mr Cook said, and on the second occasion he “grabbed my backside and tried to cup my penis again”.

After laughing the first incident off as a “badly timed drunken joke”, the second time, Mr Cook reacted angrily and threw him out of his home and did not take any further action.

“In the morning when I had calmed down I genuinely thought, he’s a lonely, gay man who was seeking some company for want of a better term, trying it on,” he said.

Chris Pincher and Daniel Cook, here pictured in 2010, joined forces on several local issues in Tamworth

“I chose to forget about it. We never ever discussed it. I moved on… I’ve never felt like a victim. I was able to defend myself.”

After allegations emerged about Mr Pincher allegedly groping the two men in the private members club, Mr Cook said local Conservatives in Tamworth were contacted by CCHQ telling them “everybody needs to shut up”.

He told the colleague that informed him of that instruction that he could potentially be defined as one of Mr Pincher’s victims and that it seemed like he was being told “to be quiet”.

“We need to be very careful how we approach this because this is what you’re doing to me now – you’re telling me to be quiet,” Mr Cook said he told his colleague.

“There was a wall of silence from Conservative councillors until I said something… we were told under no uncertain circumstances not to say a word – that’s what finally pushed me to come forward and actually say something.”