Construction industry needs to see Budget investment now, not later, says ACE

22 April 2009

Leading construction industry business association, the Association for Consultancy and Engineering (ACE) has given a cautious welcome to today’s Budget statement but says the government must give much clearer details of its spending plans if it is to tackle the serious challenges facing a construction sector reeling from the current recession.

Green issues figured prominently in Alistair Darling’s Budget, with £525 million pledged towards offshore wind projects and £435 million support for energy efficiency schemes. Announcing the government’s plans for the UK to grow, rather than cut its way out of recession, Darling said he was presenting the world’s first ever carbon Budget, which committed Britain to cutting carbon emissions by 34% by 2020. Darling said that his plans would “give industry the certainty needed to develop and use low-carbon technology-cutting emissions and create new business and jobs”.

ACE particularly welcomed the following Budget measures targeted at business: -

• A £750 million Strategic Investment Fund for advanced industrial projects – one third of which will be earmarked for low-carbon projects;
• £600 million for building new homes on dormant sites;
• A further £600 million to increase housing supply;
• £4 billion of European Investment Bank funding for renewable and energy projects to help remove blockages in project financing;
• A top-up scheme for trade credit insurance.

ACE chief executive Nelson Ogunshakin applauded the government’s green intentions but added that the devil of the chancellor’s Budget could lie in the detail. “It is clear that sustainability is near the top of Mr Darling’s list of priorities and that’s a good sign,” Ogunshakin said. “But we need to see how these plans will be implemented before we can judge their effect on our industry and the wider economy.

“The government needs to be much clearer about its intentions,” said Ogunshakin. “When it says investment in combined heat and power will be brought forward, the industry needs to know where from. With the funding measures to build more homes, spending £400 million on unlocking thousands of dormant sites, how will that unfold? We appreciate that such measures are in the pipeline but our industry needs increased investment now, not later, if we are to tackle the severe challenges facing us in a recession.”

Commenting on the efficiency agenda, where the government plans to save up to £5 billion through value for money savings, Ogunshakin said: “The mooted additional efficiencies in procurement must be worked through systematically. How are we going to achieve these efficiencies? ACE supports the concept of getting better value for money but the chancellor’s plans have to be delivered quickly and without compromising quality of delivery.

“ACE looks forward to meeting with the relevant government departments to discuss the more specific points of this Budget and how the consultancy and engineering sector can help them to target their investment wisely, with prudence and for the benefit of the UK economy as well as our industry.”

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