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Construction Downturn: Community and Amenity

The large increases in Government spending on health and education seem to have come at the expense of spending on community and amenity projects.

Glenigan estimates the community and amenity sector will contract 14 per cent in 2008.

Much of the spending this year is on building or redeveloping prison facilities. Several council buildings have also contributed to construction starts this year. However, spending on Government administration and defence buildings has been subdued.

The outlook for the sector is not likely to improve in the near term. The Government will continue to focus its spending priorities on other areas, which means there will be fewer projects coming forward in the community and amenity sector.

The sector has endured a large decline in planning approvals this year; between January and July 2008 approvals were down 39 per cent compared to the same period last year. The decline in planning approvals will mean a slow start for the sector in 2009.