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Good start, Chancellor, but more can be done

The Chancellor’s autumn statement contained more about construction and infrastructure than we’ve heard from a government in a long time.

But, after all the hints from ministers before the statement about using ‘shovel-ready’ projects to kick-start the economy, most of the schemes that have been backed as a priority are at least a year away - and sometimes much more. In other words, not as shovel-ready as all that.

Medium to longer-term visibility of the work that will be up for grabs, at least in the public sector, is much improved. The construction and infrastructure pipelines are very welcome.

Yes, they will need to be kept up to date, embellished and extended, but they provide a great deal more certainty than existed before. Most significantly, they allow firms to plan ahead, to see where the work will be and to deploy their resources accordingly.

Some businesses may even decide to adjust their business strategy to bid for work in sectors where they have not traditionally been active, such as Wates looking at whether it might move into rail.

Before the publication of the pipeline, weighing up the options to make that kind of decision would have been much more difficult.

But it’s the short term that is making people nervous, which is why the Strategic Forum for Construction has already gone back to the government to ask if there is more that can be done to help the industry here and now.

This isn’t about more investment, it’s about using existing frameworks to speed up work, or bringing forward the procurement of schemes that have planning permission and are ready to go, particularly in those areas that most need an economic boost.

Smaller and regional contractors are worried they will get squeezed out, which is why they are starting to talk about forming consortia to make sure they have an equal shot at that pipeline work.

It was four weeks ago that Construction News revealed that more than half of specialist contractors do not know where their work will come from after three months.

If the majority of work does not come on stream until 2013, those further down the supply chain will suffer, potentially bringing further consolidation and job losses.

The Chancellor’s speech may be over, but it’s essential the industry’s dialogue with government continues.

 

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