Industry responds to Chancellor’s Spending Review

Latest News Thu, Nov 26, 2020 9:15 AM

Delivering the Spending Review, Chancellor Rishi Sunak said his immediate priority was to protect people’s lives and livelihoods as the country continues to battle the outbreak - allocating £55 billion to tackle the virus next year.

He also set out how the government would deliver stronger public services – honouring the promises it made to the British people with core day-to-day departmental spending growing by £14.8 billion in cash terms next year compared to 2020/21. From 2019/20 levels, that is an average growth of 3.8% a year, the fastest rate in 15 years.

The Chancellor also announced how the government would deliver the next stages of its record investment plans in infrastructure to drive the UK’s recovery and level up for a greener, stronger future with £100 billion of capital spending next year and a £4 billion Levelling Up Fund.

Construction Products Association’s Economics Director, Professor Noble Francis, said: “As expected, the focus of this Spending Review has primarily been on aiding the recovery from the virus and furthering support for public services.

“Compared to strong statements from government earlier in the year around “build, build, build”, we have much less to go on today. That said, with our forecasts showing that infrastructure will be one of the few bright spots for UK construction in the coming year, we are pleased to finally see that government has listened to the CPA and that the National Infrastructure Strategy has some of the detail we’ve long been calling for around the government’s project plans, funding and the path to net-zero.

“Together with the spring 2021 launch of a new National Infrastructure Bank, we have reason to be encouraged that government is taking real steps, beyond simple headlines, in delivering an infrastructure sector that truly underpins UK construction and the wider economy.”

RIBA President, Alan Jones, said the economic and employment forecasts make for stark reading. Medium-term support for individuals and businesses struggling with the impact of the pandemic and a long-term investment plan to keep the country building are essential.

“The government’s financial support packages have been, and continue to be, critical for our sector,” he continued. “It’s therefore reassuring to see the Chancellor allocate significant sums of money to continue provisions.

“The National Infrastructure Strategy must also be welcomed as a long-overdue framework that should kick-start the development of sustainable transport links across the UK.

“While the Chancellor’s comments on increasing ‘pride’ within neighbourhoods and the allocation of £7.1bn to roll out a national home building plan might show some commitment to tackle our housing crisis, the funding fundamentally falls short of what’s required. Local Authorities need adequate money and resource so they can deliver the council houses we need, and those currently facing huge fees for the remediation of flammable cladding need more than the £1bn already pledged.

“Finally, wherever the government spends money over the coming year, we urge the Treasury to undertake Post Occupancy Evaluation to ensure maximum value for money. To make the most of government funds and reach net zero by 2025, the government must understand how new buildings and infrastructure actually perform.”

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