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Construction Parliamentary Update - 27 August 2010

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


Editor of Partnerships Bulletin Paul Jarvis has criticised the lack of balance in the debate surrounding the costs and value of PFI schemes and called on the government to recognise the benefits of PFI. Jarvis argued that the figures regularly reported in the media do not take into account the funding the public sector clients provide to ensure the building is maintained and he criticised headlines that overlooked the fact that PFI hospitals, schools and other buildings will “almost certainly be in better shape than any other public building of the same age” (24 August).


The Campaign to Protect Rural England and the Environmental Law Foundation have called on ministers not to pull a u-turn on the proposals to rebalance rights of appeal in the planning process. CPRE and ELF called for a new, limited public right of appeal against bad decisions, stating that this would be a vital right if local people were to have a bigger role in the planning decisions that affect them, without the huge risk of having to go to court (19 August).


The Federation of Master Builders has said that plans for a new Green Deal for households and businesses could be a positive sign for the construction industry. Deputy prime minister Nick Clegg outlined the government’s “quiet green revolution” to create jobs and protect the environment, including plans for 26 million homes in the UK to be retrofitted to make them more energy efficient (21 August).

The Construction News quarterly Tender Price Consensus indicates tender prices will drop more than previously expected. The latest price prediction survey shows the outlook for tender prices has worsened during 2010, with average expectations for a reduction of 3.7 per cent compared with previous expectations of a reduction of 3.5 per cent (19 August).


The £180 million Rathbone Market redevelopment scheme in East London has been granted the final £13 million in funding from the Home and Communities Agency. The redevelopment will provide a total of 650 new homes in the area as well as new shops and cafes, a revitalised market and community facilities, with work expected to start in Autumn 2010 (20 August).


The Homes and Communities Agency has confirmed up to £20 million in funding to provide over 750 new homes in Yorkshire and the Humber. The homes are being funded through the National Affordable Housing Programme and will be built by local authorities and registered providers of social housing (23 August).


Education secretary Michael Gove has “cast doubt” over the exclusivity clauses in local education partnerships (LEPs). It is now believed the government will insist that any new LEPs created by the sample scheme projects should not include exclusivity clauses. These clauses give an LEP the right to build any new schools funded by the local authority over the course of the contract. Because the question of long-term partnering forms an important part of a council’s considerations when deciding which company to choose, projects that have reached preferred bidder stage could have to be re-tendered (25 August).

Lewisham Council has become the first council to sign a deal for a new Building Schools for the Future project since the government decided to cut the programme. The London borough reached financial close on the third phase of its BSF scheme, which will see Deptford Green secondary school rebuilt by the local education partnership (23 August).

According to the Financial Times, new schools will face a tight timetable to open in 2011. With the capital budget for free schools limited to £50 million this year, schools aiming to open by September 2011 will have to “overcome considerable obstacles”. The FT reports that many locations proposed for new schools require substantial building work and government plans to cut building costs by easing planning requirements affecting free schools have not yet been carried through. Several high-profile projects, like the proposed Bolingbroke Academy in Wandsworth and the West London Free School, which had planned to begin taking students next year, are now facing delays (22 August).


A joint venture of Northern Irish firms will build the £85 million mental health patient facilities scheme in Merseyside. Farrans and Heron Brothers will take on the four-year Mersey Care Development Programme for Mersey Care NHS Trust and Liverpool and Sefton Health Partnership (25 August).


Gatwick Airport has announced two new supplier framework agreements for the provision of architectural and civil engineering services as part of its near-£1 billion capital investment programme to modernise the airport. Over the course of the four-year agreement, the suppliers will tender for prime design contractor roles on projects, with civil engineering services to be provided by Arup, Halcrow, Jacobs, Scott Wilson and TPS (23 August).

Labour leadership candidate Diane Abbott MP has written an article in the Daily Express criticising “successive governments’ chaotic policies towards the railways” and called on the government to “take the railways back into public ownership” (22 August).

The government has announced plans to set up an independent panel to look at applications from homeowners who urgently need to sell their property but cannot because of the proposed London Birmingham high speed rail line. Homeowners who live on or very near the proposed route will be able to apply to the Exceptional Hardship Scheme for compensation from the government. The plans were criticised by chief officer of the Chilterns Conservation Board Steve Rodrick, who predicted that the compensation bill for houses affected by the project will far exceed the scheme’s £50 million estimate. The proposed route runs through Buckinghamshire, Northamptonshire and Warwickshire, including picture-postcard villages in the Chilterns Area of Outstanding Natural Beauty (20 August).


The Olympic Delivery Authority has unveiled plans for thousands of new trees, parks, play areas and open spaces to support the new homes being delivered in the Athletes’ Village site. More than three-quarters of the residential plots in the Village are now structurally complete, and a landscaping and public realm project will be delivered by spring 2012. In legacy, it will provide 2,818 homes, of which 1,379 will be affordable, owned and managed by Triathlon Homes (24 August).