Advancing already planned construction and infrastructure projects will help to counter the sharp drop in activity in the construction sector.
Government statistics show that the number of people working in the construction industry fell by 17,000, or almost 1 per cent, between June 2007 and June 2008.
However, RICS estimates that construction employment could fall by around 14 per cent peak to trough - around 300,000 job losses - unless some action is taken.
With the threat of redundancies looming there is a serious risk that vital skills will be lost to the industry in the long term.
After the 1990s downturn, it took until 2001 for construction output to return to pre-recession levels.
RICS says the Chancellor must use the Pre-Budget Report to announce additional funding for major projects to help retain skilled workers in the construction industry.
It says priorities must be:
* Bringing forward future phases of the Building Schools for the Future scheme to renovate schools in England.
* Additional funding to bring Network Rail for forward station upgrade schemes, civil engineering projects and track work proposed for the railways.
* Housing Associations should be encouraged and funded to act as lead developers on housebuilding projects.
* Additional funding should be made available for the construction of new hospitals and the refurbishment and replacement of other health facilities.
* The Government should reconsider shelved transport schemes in cities including Leeds and Liverpool.
RICS chief economist Simon Rubinsohn said: “As the UK enters a recession it is essential that skills are not lost to the construction sector as people leave and retrain to take up other jobs.”
In a letter to the Chancellor earlier this year, the RICS set out a range of short term measures for inclusion in the Pre-Budget Report.
Here is a summary of the key recommendations:
This budget year - convert the current stamp duty holiday into long term reform of residential stamp duty land tax, replacing the ‘slab’ structure of the tax with a ‘marginal’ structure.
Future years - introduce a mortgage saving scheme to enable first time buyers to save sensibly for a deposit.
This budget year - reduce the rate of VAT to 5 per cent on building work covering the repair, maintenance and improvement of housing and historic buildings.
Exclude from rateability plant and machinery installed solely or mainly for the purposes of reducing pollution or complying with environmental standards
Future years- simplify and promote the Enhanced Capital Allowance scheme to encourage uptake and reduce carbon emissions of businesses.
This budget year/future years - increase Government funding to address skills shortages amongst planning, project management and construction professionals.
Allocate funds to keep the construction industry active during the downturn.
This budget year - double void periods to six and 12 months to reflect the time needed to assemble sites and enable regeneration and re-letting of buildings.
Future years - review the Business Premise Renovation Allowance to increase its application.