WHEN you have to walk a financial tightrope daily, 2013 might just as well be a century away. That’s how many struggling contractors feel amid rose-tinted forecasts of construction output picking up two years hence.
Even that’s just a maybe, and hopes don’t fill pay packets.
By then many good firms in construction and civil engineering, especially smaller ones, may have joined those already having had to shut shop over the past two years, paying off skilled workers and foreclosing on careers for apprentices.
Civils is one of the worst, if not the worst- hit activities in today’s economy, as further regrettable administrations illustrate. The North East is one of two regions worst affected.
Not even the millions going to enlarge the Tyne Tunnel and upgrade the Tyne and Wear Metro are changing that.
The construction sector needs a regular diet of public projects and access to funding capital for these. In the North East it’s getting neither.
We’ve had enough feedback already about policies behind the £1.4bn Regional Growth Fund to conclude that, for construction, this will be more a regional stagnation fund.
Given that Government attitude, banks in the main consider construction a bad risk now. So even private-sector alternatives dry up.
Many roads are dangerously in neglect, yet every £1 invested in a highway promises financially a near fivefold return, much of which goes back to the Treasury.
Despite that, businesses already subjected to higher taxes are also being told that if they want the commercially crucial A19 put right they’ll have to find £70m themselves.
Roadworking reduces costs of unemploy- ment. Yet even from 2014-24 the Government, for as long as empowered, says road approvals for state funding will remain provisional for anything over £5m, despite seven major programmes urgently required in this region.
The Government has announced extra money for repairs to potholes, which is excellent, but the amount available for the entire country is £100m – less than £100,000 for each authority.
That’s just enough to patch some holes, and not enough to undertake a full, lasting repair.
The Secretary of State is quoted as saying: “I am determined to see the winter damage to our roads fixed as quickly as possible, and we will be working with councils to make sure that happens.”
Not with £100m he can’t. Nor can the councils with the cuts to their local transport plans. Come on Secretary of State, add at least another zero to the pledge. This will help to make meaningful repairs.
For more information on Constructing Excellence in the North East, please contact chief executive Catriona Lingwood on 0191-3740233 or catriona@cene.org.uk
Douglas Kell, director of the Civil Engineering Contractors Association (North East)