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7 December 2012
Although the Autumn Statement predicts an extended period of low economic growth and high public borrowing and deficits, the transfer of funding from current account revenue budgets to capital investment in construction represents a net positive for the construction and mineral products industries.
MPA's pre-Autumn Statement representations called for a focus on additional and early investment in transport projects, notably road schemes and road maintenance work, which can be implemented quickly and the Autumn Statement announced an extra £1.4 billion of spending on local and national roads starting in 2013. Taking account of additional local infrastructure investment to support housing and other development projects, significant new investment for schools and colleges and confirmation of initiatives to encourage new house building and improved flood defences, the overall package is beneficial for the economy and for our industry provided cash intentions convert into short term delivery on the ground.
Nigel Jackson, Chief Executive MPA, said, “The Autumn Statement is a positive response to industry calls for more investment as well as cancellation of the planned January fuel duty increase and further action on unnecessary regulatory costs and burdens. The construction boost is modest when compared with the industry decline suffered during 2012, but it a step in the right direction. We also welcome the raising of the threshold on capital allowances. We do, however, remain concerned at the slow progress being made in getting new privately funded infrastructure projects underway. A real focus on early delivery is required here. We hope that the proposed changes to the PFI model make a difference and soon. The Government has listened and has tried to shift things in the right direction but the focus has to be about urgent delivery particularly on housing, new energy and transport infrastructure and road maintenance.”