Crisis funding has had little effect

Apr 10 2009 Douglas Kell, director, Civil Engineering Contractors Association (North East)

THE Government has pledged an economic reignition yet it is reducing and halting public funding even among communities maybe worst hit.

Builders and civil contractors take issue, because their job is to construct and uphold infrastructures that give communities a sustainability and quality of life.

Multi-million-pound rebuilds for Scotswood and elsewhere in Newcastle’s West End are jeopardised, with nearly 2,000 promised homes going into limbo.

Walker and Cruddas Park revivals are threatened because Whitehall has, again, failed to meet its agreed contribution. Where 210 new homes were promised, only 63 stand.

On road priorities and investments, the Government looks to 2014.

How many of us will be in business then? Public investment is vital now. The Highways Agency says more spending will be evident throughout England in all key areas for 2009-10.

Funny, the North East doesn’t feature in its main list...

Plenty for the South, though. Why is North East civil engineering and the great North East public in a wilderness, the only region without a full motorway?

How much “asset renewal works”, even, are there for this region, compared with other parts? I’ll bet it’s less. I’d love to be proved wrong.

The North East Assembly, which was the statutory planning framework for developing transport here (and a secretariat for the Interim Regional Transport Board putting North East proposals to government), will soon be no more.

Its final newsletter says it has appraised new schemes and identified provisional priorities – “but there is no funding commitment at this stage.” Another negative, then.

Often maligned supermarket groups don’t let recession deter them. If proposals for two supermarkets are approved at Consett and Morpeth, the region will get £48m of investment, 550 jobs and work for construction and civil industry.

If supermarkets can invest in the North East, why not central Government?

And why doesn’t it ensure its help to banks gets fed on into business?

Wrekin Construction, successful for four decades and with a healthy order book (according to Contract Journal) has been driven into administration. It wanted to borrow £2m, repayable with interest.

At a crisis meeting, a Wrekin executive says, RBS bankers played pass the parcel, unwilling to act positively.

Costs to the Treasury over two years of 600 lost jobs could now be £10m. Had the employees been kept in work the Treasury could have expected a £400,000 PAYE income stream instead.

Government crisis funding set up last November has had three changes of name, but apparently little improvement in effectiveness.

Other “Wrekins” we know of are being met with blank looks or refusals when they ask banks about the now ironically named Capital Enterprise Fund.

We urge the Chancellor to immediately extend the help available through these schemes to all businesses in need of short to medium term cash flow support, by improving the understanding of these schemes, and simplifying the current complexities in obtaining assistance.

For more information please contact regional director Catriona Lingwood, on (0191) 383-7435 or catriona@constructingexcellence-ne.org.uk.