Key focus in recent weeks has been the Chancellor’s Autumn Statement. Most of the content was pre-announced so no real surprises to the industry which has been busy lobbying over recent months. General response from the construction industry has been positive; the industry received more attention than is usual and there are initiatives with the pension funds to bring new investment into construction. But there was also disappointment as most of the shovel-ready projects promised to kick start the economy are more than a year away and as the Construction Products Association points out they do little to reverse the fall in public sector capital spending from £62bn in 2010/11 to £45bn in 2013/14. This is reinforced by the latest Office of National Statistics figures which show that new orders fell by 2.5% in October 2011 compared with the month before and were down 2.7% compared with a year earlier. The largest increase was in infrastructure and the largest fall in public non housing.
However the government’s infrastructure plan has been published and it is important to remember that infrastructure does not mean just civil engineering. For example, EDF make the point that during construction of each of their new nuclear power stations they will be building many facilities including offices and, accommodation, with employment for about 4,500 construction people at the peak.
On a more positive note, RICS latest housing market survey shows that demand rose in November for the third month in a row. Housebuilder Berkeley Group announced a 64% increase in pre-tax profits and a 20% increase in revenue. Travis Perkins also announced its preliminary end of year results with group turnover up 5.5%.