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Public sector 'crucial' to construction's future

The latest Construction Products Association forecasts highlight the construction industry’s increasing reliance on the public sector.

Construction output is set to fall by 8.5 per cent in 2009 and a further 4 per cent in 2010 – a greater fall than at any time since the early 1980s, with no recovery predicted until 2012.

But education output is forecast to grow by 28 per cent over the next two years while infrastructure is set for a 15 per cent growth.

Construction Products Association chief executive Michael Ankers said: “The only sectors where construction output is forecast to increase are linked to public spending.

“The Building Schools for the Future programme has finally got off the ground and spending on education projects is expected to grow by 28 per cent over the next two years.

“The key message from these forecasts is that the construction industry is heavily reliant on public sector spending to sustain even these reduced levels of activity.

“Spending on construction projects does create more employment than many other sectors of the economy and is more likely to draw on goods manufactured in the UK.

“It also provides the infrastructure and education facilities key to ensuring we have a productive and competitive economy as we move out of recession.

“We are still concerned, however, that the political rhetoric is not being matched by efficient delivery of these projects on the ground.

“The Government’s priority at this time must be to improve credit availability and the mechanisms for delivering public sector projects.”

Further reading:

Construction industry set for three year decline – click here

Construction Products Association credit insurance talks – click here