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Construction Parliamentary Update - 11 March 2011

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


The House of Commons Treasury Select Committee has launched a new inquiry into the future use of Private Finance Initiatives (PFI). The inquiry will take evidence from ministers and officials, trade/representative bodies, individual companies and opponents of PFI. The committee has called for all written evidence to be submitted by 28 April (8 March).

Scottish information commissioner Kevin Dunion has called on the Scottish Government to extend Freedom of Information laws to include private organisations that spend “millions of pounds of public money”. The Scottish Government opted not to extend Freedom of Information laws to organisations such as contractors who build and maintain hospitals but the newly published Commissioner’s 2010 Annual Report warns that the decision not to extend the rules “went against the intension” of the FOI Act (8 March).

Frank Field MP has added his name to the list of MPs pledging their support for the PFI Rebate campaign. Mr Field said that “our local authority was taken for a ride” when they agreed to take on the new Academy in Birkenhead and he accused PFI schemes of being a “one-sided arrangement” where taxpayers lose out to private firms (7 March).


The Royal Institution of Chartered Surveyors has published its report The Status of the Planning and Development Sector and presented it to communities secretary Eric Pickles. Mr Pickles welcomed the report and confirmed that a central part of the Budget would include a fundamental shift in the planning system to encourage growth and development (9 March).


The UK Contractors Group (UKCG) has warned of another wave of job cuts next year unless Chancellor George Osborne takes action to boost the industry in the Budget. In a letter to the Chancellor, UKCG chairman James Wates said that “the outlook for 2012/13 looks much bleaker because of substantial cutbacks in public sector capital spending and the fragility of the private sector… the result is likely to be significant contraction and job losses in the industry” (7 March).

The Cabinet Office has announced that CITB-ConstructionSkills will be retained in the public sector and will continue to report to ministers at the Department for Business, Innovation and Skills. The decision came after months of speculation about the future of the Industry Training Board and the Levy system after leaks about the wider Public Bodies Review were published in the Daily Telegraph (7 March).

Speaking at the Conservative Party Spring Forum, Prime Minister David Cameron vowed to give more construction contracts to small and medium-sized firms. Mr Cameron said “we are taking on the enemies of enterprise” by cutting the amount of bureaucracy and making “it easier for small businesses to grow, to invest, to take people on” (6 March).

The Office of National Statistics has released figures showing that new orders in the construction industry for the fourth quarter of 2010 rose by 18 per cent compared with the third quarter of 2010 (4 March).


Housing minister Grant Shapps has unveiled a new retrofit programme in Manchester that will test the key features of the government’s Green Deal scheduled to begin next year. The project could create more than 1,800 jobs and bring a £100 million boost to local businesses carrying out the home improvements (8 March).


Home Builders Federation executive chairman Stewart Baseley has called on the government to focus on policies that allow developers to deliver the homes the country needs and finalise changes to the planning system “to ensure enough land in the right places becomes available”. He also asked the government to cut the “regulation and bureaucracy that currently makes too many potential housing sites non-viable” (9 March).


Both sides of the Edinburgh tram dispute have met to try to break the deadlock that brought work on the £545 million project to a virtual standstill. The contractual dispute between the tram company Tie and contractors Bilfinger Berger has pushed the project over budget and behind schedule. Details of the mediation process have not been released but it is understood that representatives from Transport Scotland will be present (8 March).


The International Olympic Committee has been asked to settle an escalating row over finance between the British Olympic Association (BOA) and the London Organising Committee (Locog). The BOA, which is also looking to fill a gap in its budget ahead of the Games, feels it deserves a bigger cut of any surplus once the 2012 showpiece ends. But Locog disagrees, saying the deal it struck with the BOA in 2004 is “fair” (9 March).

Speaking at the MIPIM property conference, mayor of London Boris Johnson confirmed that the first legacy housebuilding contract on the Olympic Park will go to the market next month. He said that “the capital is far advanced in delivering its 2012 legacy with a huge range of major investment opportunities already arising in the Olympic Park and across east London, including the historic Royal Docks. Over the coming months London will be proudly showing what it has to offer to investors from around the globe” (8 March).



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