 |
 |
||||||
[June 2002]
Best UK Construction Prospects for 40 Years
UK construction output growth is set to outperform the general economy for four consecutive years for the first time in 40 years, according to the Construction Products Association's latest construction industry forecasts.Commenting on the forecast findings, the CPA's Economics Director Allan Wilen said: "The construction industry is poised to build on last year's strong growth, enjoying a sustained rise in output over the next three years with growth averaging 3.5% per annum. This should begin to address the UK's historic under investment which has seen the country languishing at the bottom of the European league for the quality of its built environment.
"However, the rise hinges upon the delivery of the Government's plans for greater investment in social housing, schools, hospitals and transport, with public sector growth averaging 7.6% a year over the forecast period. This contrasts with private sector growth of only 1.5%, a reflection of slower UK and world GDP growth.
"It is vital that the Government presses ahead with its spending commitments and that these are rolled forward in next month's Comprehensive Spending Review. Government progress over the last 12 months has been positive, but a number of areas of concern remain over the Government's ability to deliver.
"While we should see a significant increase in education and health related work as a number of both PFI and traditionally funded projects move forward, and increased transport investment should drive infrastructure output higher over the next three years, progress towards the Government's objectives for improving the social housing stock has been disappointing.
"Local authorities have been slow to respond to the increased funding provision under the CSR, and only a small fraction of the transfers council homes programmed for 2001/02 were completed by April. Accordingly little progress is anticipated during the current year and the growth in public housing RM&I output forecast for 2003 and 2004 is dependent upon local authorities deploying the increased funding and the delivery of a more effective transfer programme."
ENDS