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Construction Parliamentary Update - 25 February 2011

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

PPP/PFI

The Scottish Futures Trust has shortlisted three bidders for the £150 million eastern region hub project as part of the community PPP programme. The three selected bidders are Alba consortium, Amber Blue consortium and inspiredspaces. The scheme is expected to deliver community infrastructure improvements over the next ten years with a flexible supply chain offering opportunities for SME contractors and designers to become involved in building high-quality public sector buildings in their local area. The Scottish East Central Hub Territory Board will select its preferred private sector partner by the end of 2011 (22 February).

CONSTRUCTION

The Civil Engineering Contractors Association (CECA) has published the first quarterly workload trends survey of CECA members for 2011, which showed that conditions for civil engineering are stabilising but civil engineering firms continue to report negative workload balances. Despite an improvement in expectations for new orders over the next 12 months, employment continued to decline in the year to January 2011 (24 February).

Tarmac and Lafarge Cement UK has announced that they will merge to combine their cement, aggregates, ready-mixed concrete, asphalt and contracting businesses to form a new construction materials firm in the UK. The new firm will combine Lafarge Cement UK, Lafarge Aggregates and Concrete UK and Tarmac Quarry Materials, with the deal expected to save £60 million per year (18 February).

HOUSING

The Scottish Government has published the latest Scottish housing statistics which showed that there were 8% more houses completed in the latest quarter (2010 Q3) than in the same quarter last year. However the latest four quarters together show there were 16,688 completions, a 9% reduction compared with the same quarters the previous year. The Scottish Government also announced that it is investing £100 million to reverse the decline in council house building which will support the construction of almost 4,000 new council homes across Scotland (23 February).

The latest Housing Pipeline report from the Home Builders Federation (HBF) has shown that Local Authority planning permissions for house building continues to head downwards in Q4 of 2010. Across Great Britain, just 33,000 homes were approved for construction in the last three months of 2010 - 9% down on the previous quarter and 22% down on a year ago (21 February).

The Department for Communities and Local Government (DCLG) published the summary responses for its consultation on proposals for the New Homes Bonus scheme and announced that the DCLG will be implementing the scheme immediately. Through the New Homes Bonus the Government will match the council tax raised from new homes for the first six years. Housing Minster Grant Schapps MP also explained in the foreword to the consultation document that house building levels have dropped to their lowest in England and Wales in peace-time since 1923-24. The number of new homes completed in 2010 was 102,570, down 13 per cent on 2009 (18 February).

EDUCATION

Partnerships for Schools (PfS) are reported to have approved £800 million of academy jobs, with contractors expecting £200 million academy projects to be approved in the forthcoming financial year. It is thought that the jobs will become available over the four years of the forthcoming spending review period with 20 jobs worth £10 million each going through the framework in 2011/12 (18 February).

HEALTH

John Bacon CB has been appointed chairman of Community Health Partnerships the company that looks after the UK National Health Service’s Local Improvement Finance Trust (LIFT) programme. He replaces Peter Coates who was acting as interim chair after Richard Baldwin stepped down. Bacon is taking on the role alongside his existing position as non-executive chair of Sussex Partnership NHS Foundation Trust (18 February).

TRANSPORT

The Scottish Government’s Public Accounts Committee has taken evidence from executives responsible for the Edinburgh tram project who admitted to the committee that they had not ruled out asking the Scottish Government for more public money to complete the Edinburgh City tram project. Edinburgh Council director of finance Donald McGougan said that while government money “was not part of the contingency plan at the moment”, they would “explore any avenue” if more cash was required (23 February).

The Department for Transport has announced that councils in England will be given more than £100 million of extra funding to spend on repairing potholes. The funding is in addition to the £831 million provided to councils for road maintenance this year and the £3 billion the Government has pledged over the next four years (23 February).

POLICE, FIRE AND CRIMINAL JUSTICE

The UK fire service’s largest PPP project to date, the £48 million North West Fire and Rescue Services PFI scheme, has reached financial close with preferred bidder Balfour Beatty. The 25-year concession will involve the design, construction, funding and provision of facilities management for 16 community fire stations, of which seven are in Merseyside, five in Cumbria, and four in Lancashire. Construction of five of the fire stations will begin in February 2011, with all construction work to be completed by 2013 (24 February).

 

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