In a statement following the CSR, PwC construction global leader Jonathan Hook found both positive and negative sides to today’s review.
Mr Hook said: “The Government has done a good job of managing our expectations, and to a large extent the cuts announced today are what we expected. That doesn’t detract from the fact that the construction sector will be hard hit. Our economic forecasts suggest that around 100,000 jobs in the sector may go and construction output will fall by around 5 per cent. That said we need to put this in the perspective of unprecedented growth in the first decade of this century.”
Commenting on the government’s target to finance the construction of 150,000 affordable homes over the forecast period and highlighting the fact that this still represents a cut in the number of houses which could be built, Mr Hook said: “The cuts in social housing are as expected very significant, but the cuts only take us back to the 2004-07 levels. There will be opportunities for the private rental market to pick up the slack and grants can be used to stimulate this market further in conjunction with the government’s flexible tenancy proposals.”
Mr Hook also said: “It is good to hear that various transport infrastructure schemes, especially in rail, have been confirmed, but we will know a lot more next week when Philip Hammond confirms the details of the transport plan.”
The Green Investment Bank is viewed as positive, but the timing of its delivery less so. “I think the announcement that £1billion will be invested in the Green Investment Bank in 2013/14 is good news, but it is three years away, so it will take a while for the industry to see any tangible benefits. However this initiative and also initiatives such as the Tax Increment Financing scheme signal the government’s desire to find new ways of attracting private sector skills and finance to get major projects moving.”