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Construction Parliamentary Update - 7 January 2011

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

PPP/PFI

Cheshire West & Chester and Cheshire East councils have announced legal action against the government’s decision to stop their PFI funding. The two councils had been in line for £100 million in PFI credits until the environment department announced the funding was being cut as part of October’s spending review. The councils were among seven schemes to see their funding withdrawn (5 January).

CONSTRUCTION

The latest Construction Market Survey from the Royal Institution of Chartered Surveyors (RICS) shows that 59 per cent of chartered surveyors reported no movement in construction workloads during Q3 2010. The RICS say this is a result of the government spending cuts and continued concerns in the construction industry over access to finance (5 January).

The Civil Engineering Contractors Association has announced that national director Rosemary Beales will step down in March 2011 (4 January).

Glasgow City Council has appointed construction firm Bovis Land Lease to build the Scottish National Arena with building work to begin in February. The £125 million Scottish National Arena will feature capacity for 12,000 when it opens in 2013, ahead of the Commonwealth Games the following year (4 January).

Infrastructure UK has published a report of its investigation into how to reduce the costs of delivery of civil engineering works for major infrastructure projects. The report identified a number of drivers for the higher cost of construction in the UK compared with other EU countries and concluded that higher costs for UK infrastructure are mainly generated in the early project formulation and pre-construction phases. The report stated that efficiency improvements could lower the costs of delivery and realise potential benefits of £2-3 billion per annum (21 December).

The Federation of Master Builders has warned that 11,400 jobs will be lost in the construction sector over the next decade as a result of the VAT rise to 20 per cent (20 December).

New research by the Department of Civil Engineering at Bristol University suggests the use of advanced composite materials for traffic bridges could be the answer to building bridges in half the time, dramatically reducing costs and traffic flow disruption. Glass and/or carbon fibre reinforced polymer have been used in the construction of bridges in the US and Spain. The research team suggests that fresh strategies are needed to find ways of using composites in cost-effective civil engineering applications in the UK (20 December).

According to the latest survey by the Scottish Building Federation, the majority of Scottish construction firms expect their workload to decline next year. A quarterly survey of the Federation’s membership of more than 700 individual construction firms, showed overall confidence within the sector has declined for the fifth consecutive quarter. More than 60 per cent of firms responding to the survey report a reduced order book compared with the same time last year, while 80 per cent predict that industry activity will decline over the course of 2011. As a consequence, more than 60 per cent of firms expect that they will have to reduce the size of their workforce next year (20 December).

REGENERATION

The cap on government grants to restore historic buildings in Northern Ireland has been cut by 80 per cent. The maximum state aid payment for repairing and maintaining listed buildings is dropping from £250,000 to £50,000 due to high demand and a smaller funding pot. New applications are also being suspended until the Northern Ireland Environment Agency assesses the financial implications of the bids still in the system. The reduction to the grant aid cap will apply to applications received after July 5, 2010 which have not yet been issued a letter of offer. The suspension on new applications will be reviewed in April (17 December).

HOUSING

Housing minister Grant Shapps has called on self-builders to build their own homes and commit to a ‘housebuilding revolution’ in 2011. According to the Department for Communities and Local Government, self-builders are already Britain’s largest housebuilder and account for one-fifth of Britain’s new homes each year. However, the government believes that ordinary people have been “thwarted by barriers and red tape” when wanting to build their own homes (5 January).

Housing minister Grant Shapps has confirmed the government’s commitment to turn greener homes into a reality, setting out the next steps to new homes being zero carbon from 2016, including allowing councils to use funds from the Community Infrastructure Levy to fund local renewable energy generation schemes (20 December).

The Homes and Communities Agency has agreed a £250 million housing redevelopment deal for the construction of a housing project on the site of a former RAF base. A 300-acre business park and up to 1,000 new homes have been proposed at the former RAF base at Edzell, near Brechin in north-east Scotland (16 December).

EDUCATION

Lewisham Council has reached financial close on the fourth phase of the £71 million Building School’s for the Future programme. Work will begin on a brand new special school for pupils with autistic spectrum disorder, Prendergast Vale College, a new all-age school, and the rebuilding of two secondary schools, Bonus Pastor Catholic College and Prendergast Hilly Fields College. Three of the schools costing around £53 million will be built under PFI (5 January).

Financial close has been reached on the £75 million Building Schools for the Future scheme in Camden which will see building and refurbishment of three schools. A new partnership company has been formed between Camden Council and BAM to provide a new Academy sponsored by the University College London, a new special educational needs school for children aged between 3-19 years, and a part new-build/part refurbishment of the existing South Camden Community Secondary School. Construction work will commence this month with the first new school opening in June 2012 (22 December).

Final contracts have been signed for a major schoolbuilding scheme in Ealing. Construction work on the complete rebuilding of Dormers Wells High School, Southall, and the major refurbishment and partial rebuild of Cardinal Wiseman School, Greenford, is expected to start in January (17 December).

TRANSPORT

Local transport minister Norman Baker has confirmed that the government has approved plans for Surrey County Council to go ahead with the £32.3 million Walton Bridge scheme. Construction work is expected to start early this year and the new bridge is planned for completion by summer 2013, with the existing temporary bridge being removed and final landscaping works completed in spring 2014 (4 January).

Transport secretary Phillip Hammond has revealed that the proposed route for the new high-speed rail network has been significantly redrawn to incorporate changes to over half its length. The changes to the planned route were made following protests about the impact on homes and the countryside (20 December).

 

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