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Construction Parliamentary Update - 10 September 2010

A round-up of all the construction news from Westminster this week, brought to you by the Madano Partnership

CONSTRUCTION

The Confederation of British Industry has warned the government that it is in danger of repeating past mistakes with the Comprehensive Spending Review if it fails to give the necessary priority to investment in infrastructure. CBI deputy director-general John Cridland urged the government to make some “smart choices”, return capital spending to 2.25 percent of GDP as soon as possible and “appreciate the consequences of not giving infrastructure the attention it deserves” (9 September).

The Office of Fair Trading has launched a market study into the UK aggregates sector to assess whether taxpayers are getting a fair deal from suppliers of sand, gravel and broken rocks to road and house builders (7 September).

According to the latest Construction Products Association industry forecasts, the UK construction industry is heading for a double dip recession. Despite strong growth in the spring and early summer, the forecasts show output will fall in the remaining months of 2010 and the decline will continue into the first part of 2011 (6 September).

The Office of National Statistics latest data on new orders in the construction industry showed that the total volume of new construction orders in the second quarter of 2010 fell by 14 per cent compared with the first quarter of 2010, and fell by 9 per cent compared with the same period in 2009. The only sector showing a growth in new orders was private industrial (3 September).

REGENERATION

Local Government minister Bob Neil has announced that as part of the government’s localism plans Thurrock Borough Council will absorb the Thurrock Thames Gateway Development Corporation from 1 April 2012. TTGDC will move into the council’s premises by March 2011 to work more closely with the council (8 September).

Scarborough Borough Council has announced that it is looking to appoint a contractor to build a new £22 million leisure village including the construction of a community football ground (7 September).

Glasgow City Council has announced that it is seeking to procure a development partner for the £450 million Laurieston regeneration project, which will include 200 new affordable homes (2 September).

HOUSING

The Homes and Communities Agency has confirmed that over half the 165 uncommitted Kickstart and Local Authority New Build (LANB) schemes under review have now secured funding (7 September).

Bristol City Council is looking to set up a delivery panel, worth up to £250 million, covering the development of affordable housing for four local authorities in the West of England. The delivery panel will develop and deliver schemes across Bath and North-east Somerset, North Somerset and South Gloucestershire as well as in Bristol. The panel will operate for four years with a review after two years (7 September).

HCA chief executive Sir Bob Kerslake will step down at the end of the month to become permanent secretary of the Department for Communities and Local Government (6 September).

Detailed plans have been published for the proposed ‘eco-town’ in north Oxfordshire. The proposal will see 5,000 zero-carbon homes built in Bicester over the next 20 years. The latest ideas on the first phase include 400 to 450 homes, including 30 per cent classed as affordable, retail units, a care home and a community centre (5 September).

The Berkeley Group has signed a landmark deal with the HCA to establish a Private Rental Fund. Under the terms of the innovative agreement, approximately 555 new homes constructed by the Berkeley Group over the next two years will be purchased by the Fund, a wholly owned subsidiary of the Berkeley Group, and will retain the properties for rent on the open market. The deal represents the first private rental initiative to be completed with the HCA (3 September).

A report by the National Housing Federation seen by Channel 4 News shows that councils have pulled plans for around 100,000 new homes since the government wrote to councils in July telling them to ignore previous government homebuilding targets. The figures include: 9,600 homes cut by Bristol City Council, 3,000 cut by Exeter, 10,750 by North Somerset, and 9,200 by North Hertfordshire and Stevenage (2 September).

EDUCATION

A group of Welsh councils has advertised a £400 million schools building framework. The South East Wales Schools and Public Buildings Contractor Framework will include refurbishment and new-build work across several local authorities west of the border (8 September).

The government has announced that 149 further education institutions across England will benefit from £50 million emergency capital funding and building work is expected to start on sites across the country immediately (8 September).

Construction News has reported that a senior Whitehall source has suggested that contractors winning sample school deals from the previous Building Schools for the Future programme will be first in line for work that comes up under the replacement schools capital system (6 September).

Education secretary Michael Gove has announced that the first 16 of the government’s free school proposals will open in September 2011 (6 September).

Conservative councillor Elaine Costigan of Sandwell Council has announced that she would be joining the Labour party as a result of Michael Gove’s decision to withdraw funding for the Building Schools for the Future programme. Ms Costigan said “nine schools in Sandwell were told they would receive refurbishment money, only to be informed a day later the projects were being scrapped. This community has been treated with utter contempt by the government” (4 September).

TRANSPORT

The Welsh Assembly deputy first minister Ieuan Wyn Jones has approved a multi-million pound investment to complete the second phase of a major transport route in Neath Port Talbot. The £107 million of funding will provide a 4.8 km link to the M4 at junction 38 into Port Talbot and the docks, serving as a vital link to West Wales, the UK motorway network, the trunk road network and mainland Europe. It is predicted that the scheme will create up to 600 jobs during the 33-month construction phase (6 September).

Crossrail has announced the seven firms and consortia shortlisted for two tunnel refurb and construction projects - the Connaught Tunnel and the Pudding Mill Lane Tunnel Portal (2 September).

WASTE AND UTILITIES

The government plans to rule out public funding for the £20 billion tidal energy construction project proposed for the Severn Estuary. In a report to be published this month, ministers will recommend that further feasibility studies be carried out for one of four much smaller projects, which would cost about £3 billion; however, there is no guarantee that the selected option will go ahead (5 September).