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Construction Parliamentary Update - 11 November 2011

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


Ministers unveil £500m Growing Places fund allocations

Communities secretary Eric Pickles has announced the regional allocations for the government’s £500 million Growing Places Fund designed to unlock stalled developments by funding local infrastructure projects. Local Enterprise Partnerships are being invited to apply for the money, which is expected to stimulate massive private sector investment by improving the viability of residential, commercial and retail schemes across the regions. (7 November)

Public sector property revolution could unlock £8bn

Rationalisation of the public sector property portfolio could help unlock £8 billion a year according to a new report. Leaner and Greener II: Putting Buildings to Work suggests that better use of the government owned estate would improve the productivity of its workforce between five and 15 per cent. Produced by the Westminster Sustainable Business Forum after an eight month parliamentary enquiry chaired by Matthew Hancock MP, the report was formally launched by Communities Secretary Eric Pickles. (7 November)


‘Change of use’ policy could be watered down

Civil servants are trying to block Chancellor George Osborne’s policy to make it easier for developers to convert offices into flats, the FT has reported. Ministers are said to be having second thoughts about the policy - included in the government’s plan for growth last spring - after meeting severe resistance from communities department civil servants. The government had planned to implement the policy in secondary legislation, with the aim of producing thousands of extra homes each year.
But the FT reports that Whitehall is now discussing incorporating the ‘change of use’ measure in the national planning policy framework - a proposal put forward by the Local Government Association and Planning Officers Society. The dispute puts the communities department at loggerheads with the Treasury, Downing Street and the business department, which back the original plan. (10 November)


‘Spend £1bn on construction for 32,000 jobs’, new research reveals

The Chancellor has been told ‘shovel-ready’ projects would bring quick wins as regional analysis quantifies benefit.s
The construction industry has stepped up its case for investment with the first region-by-region analysis of the economic benefits it brings. Research commissioned by the UK Contractors Group shows local economies retain on average about 90 per cent of the economic benefit from construction. (10 November)

Boost for construction graduates

Job prospects for construction graduates improved last year, research has revealed. The Higher Education Careers Services Unit found 73 per cent of building and architecture graduates found employment within six months of leaving university last year - up from 68 per cent in 2009. Meanwhile civil engineering graduate employment increased from 68 per cent to 69 per cent. Electrical and electronic engineering graduate employment rose from 64 per cent to 70 per cent, while for mechanical engineering the proportion rose from 66 per cent to 70 per cent. (4 November)


Housing market in October bounces back

The housing market rebounded in October according to the latest data from the RICS, with 8% more surveyors reporting a rise in sales than a fall. The RICS’s monthly housing survey found that the number of sales per surveyor rose to 15 over the last three months, the highest figure since April, while the balance of surveyors reporting an increase in new buyer enquiries also rose, to +7% from +4%. The only weakening data from the survey was on house prices - with 24% more surveyors reporting price falls than increases, up from 23% last month. (8 November)


£13bn of viable road jobs ‘shelved’

Road schemes worth £12.8bn that are ready to be built and will deliver a huge payback to the Treasury are sitting on the shelf because of lack of funding. An analysis by Arup, conducted on behalf of the RAC Foundation, found that 96 road schemes with a high cost/benefit ratio agreed by officials are simply waiting for government cash to proceed. The Highways Agency, which would normally fund the bulk of the schemes, has just £2.3bn to spend over the next four years, rather than the £12.8bn needed. All of the schemes have been assessed as returning more than £5 of benefit for every pound spent, with the top ten scheme providing a six-fold return to the Treasury. Top ten schemes include the £117m dualling of the A21 at Tonbridge and the £146m A5-M1 link around Dunstable. (8 November)

CBI calls on Chancellor to progress more than 20 road projects

The CBI has called for roads spending to be prioritised in the upcoming Autumn statement including bringing 10 publicly-funded projects forward and reinstating a further 14 delayed in the 2010 spending review. In an appeal to the Chancellor to consider measures to kick-start growth, the CBI stated that projects on the M25, M1 and M60 should be brought forward to ease congestion in transport networks, while M1, M6 and A38 schemes should be among the delayed to be reinstated. (9 November)


Gove announces £500m schools allocations but rejects BSF challenge

Education secretary Michael Gove has today allocated £500 million of funding to more than 100 local authorities to address the shortage of pupil places this year. Mr Gove announced the additional basic needs funding in July and today released details of how much each authority would receive under the programme. The funding has come from efficiencies achieved on existing Building Schools for the Future projects, he said. The money is intended to help those authorities with the greatest pressure on school places. (3 November)


Councils urge Chris Huhne to rethink solar tariff cut

The Local Government Association (LGA) has written to energy secretary Chris Huhne urging him to delay plans to halve to the rate of Feed-in tTariffs (FiTs). The organisation warned that by reducing the subsidy earlier than planned, the government will force councils to pull the plug on thousands of solar panel installations, potentially costing them hundreds of millions of pounds. It is calling on the government to extend the deadline for the existing rate of subsidy until March 2012, the end of the financial year. At least four local authorities have already put solar power projects on hold, saying the funding cut renders them financially unviable. Those affected include Leeds City Council, Reading Council, Waltham Forest Council and Torbay Council. According to the LGA, many councils have been working flat-out to get solar panels installed before March 2012, in order to take advantage of the full FiT incentives. (10 November)


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